Loans and Guarantee

Rule 11. Loan and investment by a company under section 186 of the Act.

Where a loan or guarantee is given or where a security has been provided by a company to its wholly owned subsidiary company or a joint venture company, or acquisition is  made by a holding company, by way of subscripttion, purchase or otherwise of, the securities of its wholly owned subsidiary company, the requirement of sub- section (3) of section 186 shall not apply: Provided that the company shall disclose the details of such loans or guarantee or security or acquisition in the financial statement as provided under sub-section (4) of section 186.

In view of the above, you can pass a board resolution to give a guarantee to WOS and the details of the which shall be stated in Financial Statements.