karthikeyan.v (Chartered Accountant) (523 Points)
06 March 2010Dear learned friends
1)I would like to have a specimen of a Board resolution for borrowing in exess of the paid up capital of the comany,
2) A specimen Copy of the Board Resolution for borrowing in excess of the Authorised Capital of the comaany
Thanks a lot
karthi
Rasesh
(CS CWA MBA (Fin) B.Com LL.B (Spl))
(6501 Points)
Replied 11 March 2010
There is no such limit as stated in point no. 2. As regards 1: the limits under Sec 293(1)(d) is aggregate of paid up capital and free reserves and this would require approval from the members by way or Ordinary. A draft of the resolution to be passed at the members meeting is as under:
“RESOLVED THAT pursuant to the provisions of Section 293(1)(d) and other applicable provisions, if any, of the Companies Act, 1956 (including any statutory modifications or re-enactments thereof), the Company hereby accords its consent to the Board of Directors for borrowing any sum or sums of money from time to time from any one or more of the Company’s bankers and/ or from any one or more other persons, firms, bodies corporate or financial institutions, whether in India or abroad, and whether by way of cash credit, advance or deposits, loans or bills discounting, issue of debentures or other securities or otherwise and whether unsecured or secured by mortgage, charge, hypothecation or lien or pledge of the Company’s assets, licenses and properties, whether immoveable or moveable or stock-in-trade and work-in-progress notwithstanding that the moneys to be borrowed together with money already borrowed by the Company (apart from temporary loans obtained from the Company’s bankers in the ordinary course of business) will or may exceed the aggregate of the paid up capital and free reserves of the Company, that is to say, reserves not set apart for any specific purpose, so that the total amount upto which the moneys may be borrowed by the Board of Directors and outstanding at any time shall not exceed the sum of Rs. 50,00,00,000/- (Rupees Fifty Crores only) and the Board of Directors (including any of committee/s thereof) are hereby authorised to execute such debenture trust deeds or mortgage, charge, hypothecation, lien, promissory notes, deposit receipts and other deeds and instruments or writings containing such conditions and covenants as the Directors may deem fit.”
CAclubindia
