Go AD-Free with CAclubindia Pro and Daily Mobile Updates. Subscribe Now!

loan to MD and WTD

Supraj Devadiga (20 Points)

22 July 2019

can a private company give loan to its managing director and whole time director???if yes, what is the procedure??

Reply
Follow
Share

2 Replies

Shivam RC (Student) (23683 Points)
Replied 24 August 2019

Yes they can give Loan

CS Vasudev Sharma (Service) (405 Points)
Replied 30 August 2019

Yes the Company is allowed to given loans to its WTD and MD under a loan scheme which is allowed for each and every employee of the orgainisation and dose not limited only to the WTD and MD only.

Sub section 3(a) of section 185 states that

a) giving of any loan to a managing or whole-time director – (i) as a part of the conditions of service extended by the company to all its employees; or (ii) pursuant to any scheme approved by way of special resolution;