Sec 295, Companies Act, 1956.

Kindly check the example below:

If company A is advancing loan to company B then in that case company A is the lending company. Here company A cannot provide loan to its director (Lending Company’s director) through company B or through other associates as mentioned in section 295.

hi kitty

Section 295 of the Companies Act regulates grant of loans by a public company (and its subsidiaries), barring exempted categories, to its directors, their relatives and the firms and companies in which they are interested, as mentioned in the said section. Therefore, the section provides that a company cannot make a loan, give guarantee or provide security in connection with such a loan without obtaining the previous approval of the central government.

this section is applicaple to only directors of company and their relatives and the firms and companies in which they are interested,

hope this will solve your query :)

take care

Yes...agreed with Sanjay..

please provide me board resolution and all other resolution and explanatory statement for section 372A AND 295

Regards

kamakshi

please provide me board resolution and all other resolution and explanatory statement for section 372A AND 295

Regards

kamakshi

Find attached herewith a useful file containing 4 different companies 372A resolutions with Explanatory statements.