18 September 2012
If wholly owned subsidiary company gives loan to its Holding company, then will this transaction attract the provisions of section 295 of Companies Act, 1956 or not.? and also give the violations of this section
18 September 2012
As far as my knowledge is concerned, exemption is given only when HOLDING gives loan to subsidiary.. if subsidiary company is giving loan to holding, it does attract section 295.. still let other experts answer..
18 September 2012
According Sub-section (2), following transactions are exempted from the restrictions of sub-section (1) i) Any loan made, guarantee given or security provided – by a private company which is not a subsidiary of a public company, ii) Any loan made – by a holding company to its subsidiary, iii) Any guarantee given or security provided – by a holding company in respect of a loan made to its subsidiary.
So Reverse Case is Missing in This Section.
It Means Loan From Subsidiary to Holding is Not Exempted u/s 295.
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