Deemed Dividend
This query is : Resolved
29 March 2010
Dear All,
Good Day,
Pvt. Ltd. Company gives a Unsecured Loan to it Sister Concern Ltd Company Rs. 20.00 Lac Directors or Share Holders are same in the both Company. Two Shares Holders having >20% shares in both also.
Whether the payment of Unsecured Loan will be Deemed Dividend or not.
Is any other consequences will arise against the same.
Please advise
Good Day,
Pvt. Ltd. Company gives a Unsecured Loan to it Sister Concern Ltd Company Rs. 20.00 Lac Directors or Share Holders are same in the both Company. Two Shares Holders having >20% shares in both also.
Whether the payment of Unsecured Loan will be Deemed Dividend or not.
Is any other consequences will arise against the same.
Please advise
29 March 2010
If the transaction is between 2 private limited companies then deemed dividend concept will not be attracted. Provided you pass proper resolutions and charge interest for loan and proper documentation.
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