Filing of form mgt 14

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Querist : Anonymous

Querist : Anonymous (Querist)

26 September 2014 Dear All

Is it necessary for an NBFC to file form MGT-14 pursuant to Section 179(3) each time it gives loan.

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Ankur Garg

Ankur Garg (Expert)
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27 September 2014 As per my opinion Yes. Keeping in view the language of Section 179 it is required by every company to file form MGT.14 every time it gives loan.

Section does not make any distinction between NBFC or NBNFC. However you should seek professional advise in this matter.

Thanks

Ankur Garg

Ankur Garg (Expert)
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27 September 2014 Law related to filing of form MGT.14 under Companies Act, 2013 (22 July)

Filing of form MGT.14 is mandated by section 117 of the Companies Act, 2013. Section 117(2), prescribe the penalty for non-filing of form MGT.14.

As per Section 117(2), if a company fails to file the resolution or the agreement under sub-section (1) before the expiry of the period specified under section 403 with additional fee, the company shall be punishable with fine which shall not be less than five lakh rupees but which may extend to twenty-five lakh rupees and every officer of the company who is in default, including liquidator of the company, if any, shall be punishable with fine which shall not be less than one lakh rupees but which may extend to five lakh rupees.

For more clarity about form MGT.14 read my article available at the link mentioned below:

https://www.caclubindia.com/articles/list-of-resolutions-to-be-filed-with-roc-in-form-mgt-14-20664.asp#.U8O57KM27cs

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Querist : Anonymous

Querist : Anonymous (Querist)

29 September 2014 But Sir, sub section 1 of section 179 also states that "in exercising such power or doing such act or thing, the Board shall be subject to the provisions contained in this behalf in this Act.....".

Section 185 and 186 also exempts an NBFC wrt lending and investment beyond the limits specified provided they fulfil the condition of the relevant section. If lending is the ordinary course of business of an NBFC, then it shall be very inconveneint for an nbfc to hold a Board meeting everytime it lends and file MGT 14 all the time.

In anticipation of your view.

thanks

Querist : Anonymous

Querist : Anonymous (Querist)