Section 185 & section 186

This query is : Resolved

Pooja Panvelkar (Querist)
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09 July 2015 One of our Company's director has applied for a loan from a bank where he has shown the company as a Co-applicant for the same. request you to resolve my queries given below:

1) Can a Company be Co-Applicant for a loan applied by its Director?

2)can a Company be shown as a guarantor for the loan availed?

3)Will this trigger the Provisions of Section 185 & section 186 of the Companies

4) If company is a Co-applicant then will it be registered as a charge on MCA?

Ankur Garg

Ankur Garg (Expert)
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09 July 2015 As per my opinion status of company as co-applicant is equal to loan to director by the company which is a violation of section 185.

Thanks