14 May 2009
My company is a private company and one of director of my company is having partnership in its sister concern so in that case whether section 297 & 299 will be applicable and why?
Can a private company accept unsecured loan from their director , if yes then any resolution will be passed for this and will it be termed as a deposit
Yes. A private company can accept unsecured loan from Directors.
U can see the following extract from the definition of DEPOSIT: (b)"deposit" means any deposit of money with, and includes any amount borrowed by, a company, but does not include-
(ix)any amount received by a private company from a person who, at the time of the receipt of the amount, was a director, relative of director or member: Provided that the director or member, as the case may be, from whom money is received, furnishes to the company at the time of giving the money, a declaration in writing to the effect that the amount is not being given out of funds acquired by him by borrowing or accepting from others;
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