loan from shareholders

Of corse, yes. Please refer to section 58A and 58AA of Companies Act 1956.

That is if by a shareholder loan agreement, a shareholder gives a loan to the company (interest free), is it deemed a deposit as under Section 58A  and the deposit rules etc.

Please advice..

Yes please.

Srinivas Ji,

I need some clarification wrt the issue related to interest free loan from shareholders: -

A company "ABC Ltd" is shareholder (holding 10% shares) of company "XYZ Pvt Ltd". Can "ABC" give interest free loan to company "XYZ".

As far as I think from income tax point of view we can not give.

Need clarification.

Thanking you 

Originally posted by : S.Srinivasaraghavan
	Of corse, yes. Please refer to section 58A and 58AA of Companies Act 1956.

Dhiraj Sir,

Provisions of Intercorporate loan will attract also check section 295 of the Companies Act, which provide fro loan to directors and private compnaies in which director of ABC Ltd are director.

Regards

Jaideep Pandya

Is there any restriction in income tax act? 

Shareholder being a company can give loan to the company, tax implications may/may not arise, but company being shareholder can give loan. Tax implications may follow. But i doubt any tax implication in this regard/.

If company gives loan to shareholder, then if conditions mentioned u/s 2(22) are satisfied, then tax implications may follow. 

please correct me if am wrong.