Loan to director of pvt company roc compliance

This query is : Resolved

Rahim (Querist)
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06 November 2018 Sir

Please let me know the process ( ie, meeting, resolutions etc) to give loan to director of Pvt Company, All 3 conditions are satisfied, viz 1 No Body Corporate invested in Share Capital of Pvt Co, 2. No Borrowings from Banks & FI Etc.

Also reply Remarks to be made in Auditors Report if any

CA Suresh Jain

CA Suresh Jain (Expert)
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07 November 2018 Section 185 of the Companies Act 2013 prohibits company to give Loans to the Directors except to the Managing or Whole time directors as a part of service contracts extended to all its employees.

The provisions of deemed dividend under section 2(22) (e) of Income Tax act may also be applicable.