Loan from Directors

 Yes. Section 299 r.w. section 300 has to be complied with i.e., disclosure at board meeting regarding interest has to be made and entries to be made in the register maintained u/s 301. Pass resolution at Board meeting u/s 292 (1)(c). Obtain declaration from the director in terms of section 58A. 

In my opinion it will be treated as deposits and section 58A and Acceptance of Deposit Rules, 1975 should be complied with. Limits are also therein.

yes, i m also agree that the unsecured loan shall be treated as deposit u/s 58A. As per RULE 3(1)(a) i.e Min. & Max time limit for acceptance of deposit Min 6 months Max 36 months in tthe following cases a company may accept deposit for a period of less than 6 months but not less than 3 months:- 1) Deposit against unsecured debentures 2) Deposit raised from its shareholders by a company other than Pvt. Co. 3) Deposit, of which the repayment is guaranteed by the directors of company. Rule 3(1)(b) Ceiling on depsosit In case of Govt. Company upto 35% of its paid up capital and free reserve In case of other companies Upto 10% of its paid up capital and free reserves in case of three type of deposits above Upto 25% of its paid up capital and free reserves, in case of other deposits. My question is that whether the unsecured loan from director is covered under 25% of its paid up capital and free reserves? Whether it is compulsory to pay interest on unsecured loan taken from director of the company? Whether it is compulsory to repay the unsecured loan taken from the director within 36 months from the date of acceptance?

 I would like to draw the attention to rule 2(b)(ix) of the Companies (Acceptance of Deposits) Rules which, inter alia, excludes "amount received from director of a company" from the definuition of deposit. In my view, the same do not come within the purview of deposit. the same has been clarified by MCA vide circular no 1/1/80 - CLV/7/33/78-CLX dated 3.5.80.

 

 

Dear Pawan,

 

It is a exempted deposit. Deposit obtained from the director is a exempted deposit.

yes it is an exempted deposit

Originally posted by :Khushboo Maheshwari
"	Can a public limited company take loan from its directors, if yes is there any restriction regarding amount of loan or interest to be paid. Please clarify its urgent	"

 

Can a public limited company(Listed) take unsecured loan from its shareholders ?

Kindly reply me.....

Any one have format of declaration from the directors of a pvt. ltd. com. for unsecured loan under the companies act, 1956.

Please provide.

Amit Trivedi

atrivedi13 @ yahoo.co.in

Yes I agree with Mr. Pavan