Security for working capital

first see whether the three conditions as provided in the exemption notification are satisfied or not if statisfied then this transaction is valid.

Dear Prasanth,

As per section 185 of the  Companies Act, 2013. Security provided by a holding company in respect of loan made by any bank or financial institution to its subsidiary company is exempted from the requirements of section 185.

Creating security on property of group company, there is no restriction in CA, 2013 but if other company is not holding company or limited company to private company, they should not give security to your private company, it is prohibited under section 185(1) of the Companies Act, 2013.