Go AD-Free with CAclubindia Pro and get a FREE CCI Coffee Mug. Subscribe Now!

Advance against Salary to Director

Naveen teli (Student) (149 Points)

26 July 2018

Can a Private company give advance against salary to any director???

Reply
Follow
Share

7 Replies

CA Sunil Kumar (Chartered Accountant) (4524 Points)
Replied 28 July 2018

The proviso of section185(1) provide that 185(1) shall not apply on loan to a Managing or Whole time Director as part of conditions of service extended by the company to all its employees, (same condition on which company gives loan to all its employees) or according to scheme approved by the members by passing special resolution.

1 Like

Upgrade to CAclubindia Pro. Subscribe Now!

Naveen teli (Student) (149 Points)
Replied 28 July 2018

My query is for Directors other than MD and WTD

CA Sunil Kumar (Chartered Accountant) (4524 Points)
Replied 28 July 2018

same rule is also applicable on directors .

1 Like

Vinod Babu (24196 Points)
Replied 29 July 2018

In accordance with provisions of sub-section (1) of section 185, Save as otherwise provided in this Act, a Company shall not, directly or indirectly, advance any loan, including any loan represented by a book debt, to any of its directors or to any other person in whom the director is interested or give any guarantee or provide any security in connection with any loan taken by him or such other person.

RAJA P M ("Do the Right Thing...!!!") (128101 Points)
Replied 29 July 2018

Originally posted by : Vinod Babu
	In accordance with provisions of sub-section (1) of section 185, Save as otherwise provided in this Act, a Company shall not, directly or indirectly, advance any loan, including any loan represented by a book debt, to any of its directors or to any other person in whom the director is interested or give any guarantee or provide any security in connection with any loan taken by him or such other person.