Now even private companies cannot give loans to directors?

Yes, I agree with your view. At least private companies should have been given exemption as before. Further what about the private companies which have already given loan to its directors in accordance with the Companies Act, 1956 before applicability of this section ??

Existing loans given by private companies as per Companies Act 1956 will not be affected by the new provision.  Only new loans will be governed by the new provisions.

 

 

The new Act has not come into force except section 1.

Section 185 relating to loan to directors has been notified  w.e.f. 12-09-2013 and as such no company cannot give any loan to directors or other entities in which director/s is/are interested. According to it no loan is now possible between holding/subsidiary/group companies.

The new section 185 of Companies Act 2013 has been specifically introduced for the said purpose which makes it now not possible for loan even to subsidiary forget Director, not sure whether it is a drafting error or intentional. The subsequent section 186 defines the limit for eligible Companies but private ltd Companies are now not eligible where as earlier the exemption from intercompany loan section 295 was only for private companies.

private company sanctions a loan to a director in april 13 Board meeting

the amount is disbursed in March 14

will it be covered under old provisions

also what about old loans given in 2010 to directors