Can a Public ltd. co. give loan to a Private co. if in that Pvt co., the director of the lending public co. is not interested either as a director or member ??
Sunaina Jain (Job) (92 Points)
15 September 2014Can a Public ltd. co. give loan to a Private co. if in that Pvt co., the director of the lending public co. is not interested either as a director or member ??
P C Agrawal
(Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad)
(8229 Points)
Replied 15 September 2014
- Inter-corporate deposit is not a public deposit as per Companies (Acceptance of Deposits) Rules 2014.
- Sec.185 will not apply in this case.
- Lending co. has to ensure compliance of Sec.186; pass board resolution & file MGT.14
- Borrowing co. has to ensure compliance of Sec.180; pass Board resolution & file MGT.14.
Sunaina Jain
(Job)
(92 Points)
Replied 15 September 2014
Thank u Sir for the reply.
Sir, I have one more query regarding this. Will there be any contravention of the Act ,if the private co. to which loan is to be given is a shareholder in the Lending Public Co. ?
Sunaina Jain
(Job)
(92 Points)
Replied 15 September 2014
Thank u Sir for the reply.
Sir, I have one more query regarding this. Will there be any contravention of the Act ,if the private co. to which loan is to be given is a shareholder in the Lending Public Co. ?
Sunaina Jain
(Job)
(92 Points)
Replied 15 September 2014
Will the Deemed Dividend provisions of The Income Tax Act, will get attracted in this case, when the pvt co. is a shareholder in the Lending Public co.??
P C Agrawal
(Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad)
(8229 Points)
Replied 17 September 2014
Provisions of deemed dividend will apply only iff the conditions of Section 2(22)(e) of IT Act are attracted. Pl check the same.
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