Loan to director from pvt ltd co

Hi,

In case of Loan to director previous approval of Central Govt. is required u/s 295. But this section is applicable to a public company only.

So in your case section 295 is not applicable and company can give loan to you just by passing a board resolution at the prevailing rate of interest.

Thanks

CHECK CONDITIONS SECTION 2(22)(e) OF INCOME TAX ACT... PERHAPS THE SAME WILL BE CONSIDERED AS DEEMED DIVIDEND AND TAXED IF YOU HAVE SUBSTANTIAL INTEREST IN THE COMAPNY

REGARDS

Agreed with Ankur Sir & Virenderji

Yes,I think Sec.2(22)(e) is quite a dangerous Section to consider here.

The Directors will not be prohibited by the Companies Act, but the I.T.O will add the whole amount in the personal file of the Directors if they meet the Deemed Dividend criterias.

Be very careful while using/suggesting this Section to others,especially your Directors - it may cost you your job. 

Consider sec 2 (22) (e), TDS on the loan taken is to be deducted u/s 194 @ 10% also.....

Thank you all!

From what I understand, it is not avisible to take loan from company, not for company but for me as director, it will create lot of problem in my IT returns.

Thanks again