Hi, is there any restriction on private limited company on giving unsecured loan to its Directors friends by cheque
Menu
Loan By Company
Replies (4)
Loan to director is governed by section 295. But the same section is not applicable to a purely private company. So you may go ahead. However recording of the same transaction in board minutes is necessary. As dir is interested so disclosure of interest from dir u/s 299 is required. Further he can not vote u/s 300.
Agree with the above view. However, Deemed dividend : Sec 2(22)(e) of the Income Tax Act, could be attracted in case the Director holds more than 10% voting right in the Company and the transaction satisfies other conditions given in the section.
As per my interpretation In case of purely private company interested director can participate in discussion and vote as per section 300(2).
| Originally posted by : HARDIK | ||
 |
As per my interpretation In case of purely private company interested director can participate in discussion and vote as per section 300(2). |
 |
Agree with the learned member.
Recent Threads
- Exemptions under New Tax Regime
- ITR-2 Payment Made but Status Not Updated
- Need help for ITR filing
- ITR Updated returns. Time limit for filing
- ITR 2 Processed and Refund Credited to Bank
- Freelancer or Salaried
- LTCG Tax and Indexation on Debt Mutual Funds Sold
- Section 45(5A) and 194IC with carry forward of tds
- Paid tax amount, CIN generated and challan downloa
- INTRADAY INCOME PRESUMPTIVE INCOME
CAclubindia
