A Private Company has taken unsecured Loans from Director and his relative which is exempt from the defination of deposits. But if the Director resigns and the said Loan continues,are the loans still exempt?
Please advice
shristi (executive) (96 Points)
02 January 2013A Private Company has taken unsecured Loans from Director and his relative which is exempt from the defination of deposits. But if the Director resigns and the said Loan continues,are the loans still exempt?
Please advice
Dipjyoti Majumdar
(CA in service & CS. dipmaj@ rediffmail.com )
(3468 Points)
Replied 03 January 2013
Yes it is still exempt as on date of taking loan from Directors the condition had been complied with.
Tanveer Md Masood
(Indispensable)
(361 Points)
Replied 04 January 2013
section 295 makesit crystal clear that a public or private company cannot issue loan to its director with out btainig prior approval of th central government.
Dipjyoti Majumdar
(CA in service & CS. dipmaj@ rediffmail.com )
(3468 Points)
Replied 07 January 2013
Mr. Tanveer
Thanks for your observation. Perhaps you have read the issue in haste and therefore the answer was not too appropriate.
Here the matter was that the Company received the loan from Directors and did not give the loan to Director -- thereby not attracting section 295.
Regards,
CAclubindia
