Section 180 of companies act 2013

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

10 June 2014 Earlier section 180 of Companies Act, 2013 was not applicable to Private Companies.

In private Companies, Shall we have to pass special resolution for borrowings exceeding paid up capital & free reserves for borrowings taken before applicabiltiy of this section.

Thanks.

Mandar Karnik

Mandar Karnik (Expert)
Follow

10 June 2014 Section 180 is a brand new provision of the Companies Act 2013. In it there is no distinction between Public and Private Company hence the provisions are applicable for a private company as well.According to a Circular dated 25/3/2014 no. 04/2014 it was provided that a resolution u/s 293 of the Old Act given prior to 12/9/2013 will be applicable for a period of one year. However this Section 293 was applicable to public companies and private cos which were subsidiaries of public companies. So it is quite clear that private companies will have to file Special Resolutions in EGM.

If borrowings were taken before applicability of this section by a private company then we need to call an EGM for giving approval to the terms and conditions of the existing loans taken according to the provisions of Section 180 of the Companies Act 2013.

So in this case you will have to call an EGM for approval of borrowing powers by a private company within 1 year of the applicability of the said provisions.

Message likes : 1 times

Querist : Anonymous

Querist : Anonymous (Querist)

11 June 2014 Thanks thanka alot sir

Upgrade to CAclubindia Pro. Subscribe Now!