Yes, Bank can recover loan from B Ltd.
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Urgent Query - Holding company and 100% subsidiary company
I ALSO AGREE WITH ABOVE REPLIES
YES THEY CAN RECOVER LOAN FROM B LTD.
There is no logic to recover a loan from its Holding Co. ...
Unless there is a contract, HOLING CO. shall not be liable...
agreed with these answers....
based on the seperately legal entity concept bank has no right to recover from holding company., bcz there is no guarantee given by holding company for the purpose of the loan.
only if B ltd had provided guarantee to bank on behalf of A ltd.
No Bank can not recover such laon from B.
only if B provide a guarantee for A than bank can recover it .
PL TELL ME WHAT IS THE COST OF AQUISITION OF GOODWILL OF A PROFESSION
| Originally posted by :CA Rakesh Somaiya | ||
| " | If holding company has given the gurantee then bank can. otherwise.. As per the separate entity concept, Bank can not recove the loan from holding company. If one has use subsidiary to make such a planned fraud then court may lift the veil and recover the loan from victims. |
" |
Nice Answer...and I agree...
If Corporate Guarnatee provided or if the Holding company is the befeciary of the funds taken as loan (corporate loan etc) - then recoverable by B
Else cannot be recovered by "B" - B is a seperate legal entity.
In a Court - more data would be required as to the business of both the enttities...what was the loan used for... why did A defualt and why did B not help....etc..etc.
Do remember...if B defaults all the Directors get reported to "Defaulters List" and i presume A & B would have some common Directors... this will make life harder for B company
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