Director loan

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

23 June 2015 Respected Sir

I want to know that can a pvt. ltd. company can give loan to any director or his relative as per new com. act 2013?

What to do if company has already given loan to his directors before said section come into existance???

Ankur Garg

Ankur Garg (Expert)
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24 June 2015 Hi,

After 05.06.2015 section 185 of companies act, 2013 is not applicable on a private company:

(a) in whose share capital no other body corporate has invested any money;

(b) if the borrowings of such a company from banks or financial institutions or any body corporate is less than twice of its paid up share capital or fifty crore rupees, whichever is lower; and

(c) such a company has no default in repayment of such borrowings subsisting at the time of making transactions under this section.

Thanks