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Loan from relative by Private Company

Aanshi Jain (41 Points)

01 July 2020

Can a private company take loan from its relatives?
if yes under what conditions?

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Priyanka Jhanwar (140 Points)
Replied 01 July 2020

A private company can take loan from directors and relatives of director. Provided a declaration is given by director and relative of directors as the case may be.

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Aanshi Jain (41 Points)
Replied 01 July 2020

Please quote the section

Priyanka Jhanwar (140 Points)
Replied 01 July 2020

Unsecured loan accepted by private company from directors/ relative of directors are covered under the EXEMPTED DEPOSITS under rule 2 of companies (Acceptance of Deposit) Rules, 2014.

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