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Share issue in exchange of directors loan
can a company issue equity share capital in exchange of loan taken from directors ??
Replies (4)
No a company can not convert loan into share capital.
first the company has to return loan to directors and after that he accept the amount from directors in a share application bank account then u can issue share to a director.
is there any section regarding the same ?
you can find it in section 42 of the Companies Act, 2013
nope cannot convert it's against the interest of members bound by moa and AOA
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