Directors formed a Pvt. Ltd. company but during pre-incorporation period and initially during post-incorporation period directors made payments in cash for various expenses for an amount exceeding Rs. 20,000 in a year but not exceeding Rs. 20,000 through single payments for and on behalf of company. Whether any violation is done by the company U/s 269SS? If not then how to account it in the books of accounts and under which head. Please Suggest.
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Whether 269ss applicable for payments made by directors?
Replies (4)
I am not treating these payments as unsecured loans but as expenses payable to directors. Then what will be the position? Also note that client has already taken this amount back from company in cheque.
Amount in cheque was taken by the directors after spending the same for the company.
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