A pvt company wants loan from Bank against shares held as an investment. However bank does not give loan to the company against shares and therefore the shares are transferred to the Demat accounts of directors; took a loan against those shares in the name of director and the same loan was transferred to company. The company has shown secured loan from Bank. The repayment is through director only. Whether the above modus operandi to accquire loan correct? Accounting treatment in the books - correct? What should be the qualification in the report / a simple disclosure will do?
Menu
Loan from Bank Through Director
Replies (2)
Accounting Treatment is wrong.. Company has not shown loan from Bank.This is a loan from Director.Because company is not liable to pay the loan to the Bank.Director is the responsible person only.
Dear Ankur,
I agree with argument realted to wrong accounting entry done herewith.
You need to check the provisions of Sec.58A of Companies Act also. According to me, the transaction is not exempt in Rule 2(ix) of said provision. It seems violation of Provisions of Sec.58A applicable to Private Co.
Recent Topics :
- FAI & FAST-DS 2026 query
- Is GST registration mandatory in this case
- Buying a residential flat in Goa: should my wife b
- Income tax filling
- Applicability of RCM in the case of import of serv
- Confusion in gst registration for service category
- Itc claimed from return defaulters
- Gst input credit
- CAN PARTNERSHIP FIRM SIGN SERVICE AGGREMENT WITH A
- E-waybill
Related Topics :
CAclubindia
