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Acceptance of Loans by Company from Directors

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(Querist)
29 March 2011 Can a private limited company take loans from its directors, as Section 372A only specifies for making loans, giving Guarantees etc.
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Jayashree S Iyer

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Jayashree S Iyer (Expert)
29 March 2011 A company can accept loan from Members, Directors and their relatives. Any loan taken from others will be treated as Deposits which would attract provisions of Section 58A of the Companies Act, 1956.

Intercorporate loans are permitted subject however to the provisions contained in Section 372A of the Companies Act, 1956.
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Pravin Gupta CS

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Pravin Gupta CS (Expert)
15 April 2011 I agree with Jayshree mam... and added one thing..

This loan shall be deemed as unsecured loan.
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