ABC Private Limited intends to give Corporate Guarantee to XYZ Private Limited. However, XYZ Private Limited is a wholly owned subsidiary of a Overseas Foriegn Body Corporate DFG Pte. Ltd.
Query:
Sec 186 is not applicable to a w holly owned subsidiary so a ho holding company can give loan or guarantee to 100% subsidiary
As per the company act a holdi company can give loan or guarantee without following the procedure mentioned in sec 185 but since xyz is not the subsidiary of ABC and if the guarantee given to xyz exceeds the threshold limit u/s 185 then ABC guarantee must be approved by a special resolution in agm
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