One of our group company (purely pvt. company) provide bank guarantee to govt. organisation for successfully completion of bids and no loan amount associated with this trabsaction. Furthe the same amount of bank guarnatee secured as corporate gaurnatee by Public company.
Now will section 372A attract and also calrify that whether Sec. 372A cover any the inter corporate guarantee or securities provided by public company for performance of any specific work (for performance guarantee)
06 June 2012
Section 372A uses the term ‘guarantee in connection with loan made’ - making it amply clear that the provisions of section 372A will be applicable in case of guarantee in connection with loan made.
As you have mentioned that there is no loan involved in your case, therefore to my understanding section 372A will not be involved.
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