Dear All,
1) can unsecured loan taken from director cum promotors will get exemption under section 58A
2) if he is exempted, then what if he resign as director but remain as promotor of a public company will the exemption continues under 58A.
kindly answer my query with any supporting provision it would be helpful to me.
Reply to your questions is given in Rule 2(b)(ix) of Companies (Acceptance of Deposits) Rules 1975 which excludes from definition of deposits:
"(ix) any amount received from a person who, at the time of the receipt of the amount, was a director of the company or any amount received from a relative of a director or its member by a private company:
Provided that the director, relative of a director or member, as the case may be, from whom money is received, furnishes to the company at the time of giving the money, a declaration in writing to the effect that the amount is not being given out of funds acquired by him by borrowing or accepting from others;"
Under Acceptance of Deposit Rules, 1975, deposit from director is an exempted deposit. In case the director ceased to be a director, then also such deposit shall continue to be exempted deposit till the period of maturity. Because on the date of appeptance of such deposit the person is the director. After that period such exemption will not be also be ceased.
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