Borrowing of money in the ordinary course of business
Querist : Anonymous
I would be highly obliged if anyone can clear my doubt on whether borrowing of money by a company is in the ordinary course of its business.
Thanks
Querist : Anonymous
Specific section cannot be referred here, its just a general query. Otherwise Section 179 of CA 2013 can be taken into consideration.
My question is, is borrowing of money by a company be considered as an activity in its ordinary course of business.
Thanks
Querist : Anonymous
Specific section cannot be referred here, its just a general query. Otherwise Section 179 of CA 2013 can be taken into consideration.
My question is, is borrowing of money by a company be considered as an activity in its ordinary course of business.
Thanks
Querist : Anonymous
Querist : Anonymous
If you see Section 180(1)(c), here you can say that borrowing of temporary loan can be considered as ordinary course of business.
It does not specify if a company borrow money from another entity/person (not from bank), will it be treated as ordinary course of business or not?
It differs from context to context, because it is not defined in Companies Act.
Querist : Anonymous
But in my view , a company in its day to day running of business frequently requires funds to meet its obligations, and in order to meet those obligations, approach lenders which could be an NBFC, bank or other entity to borrow for a short period say for a year and which might trigger Section 188( Related party transactions).
I believe that such borrowings would also be considered as a transaction in its ordinary course of business .
thanks
Querist : Anonymous
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