Share issue in exchange of directors loan
VIKASH KAPURIYA (3 Points)
26 February 2019
can a company issue equity share capital in exchange of loan taken from directors ??
4 Replies
Naveen Jain
(Company Secretary)
(154 Points)
Replied 28 February 2019
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.
Naveen Jain
(Company Secretary)
(154 Points)
Replied 28 February 2019
you can find it in section 42 of the Companies Act, 2013
Priya Kashyap
(Student)
(7053 Points)
Replied 16 March 2019
nope cannot convert it's against the interest of members bound by moa and AOA
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