loan from director's relative

In what ways u are seeing loan taken from director's relative as a service?

In Ramaiya under Section 297 services are deemed to include financial, Banking services. Our Auditor is insisting for a CG approval as the paid up capital of the Company is above 5 crore.

Preeti Gandhi

A single loan taken from director's relative cannot be considered as a service provided by director's relative. Hence outside the preview of section 297. Service is something done on a regular basis.

Wait for other opinions. Thanks

Completely agree with Ankur Sir,

My point of view is- if director's relative is individual and providing loan is not his business it will not amount to loan but if it has been taken from a NBFC run by a Director's relative then it will mount to service.

Regards

I agree.

Taking a Loan from Director's Relative will not tentamount to any kind of services, unless the director's relative carries out such operations of financial assistance on regular basis.

A one off transaction will not attract 297.

Rgds,

Ashish

Section 297 talks about the board approval in certain contracts in which particular director are interested,contracts for purchase, sale or services, but one time loan given by director s orr their relatives are not covered under the head services, unless untill its their business to provide loans and financial assistance orr its a finance Co, in which director orr their relative are partners

Loan taken by the listed co. from its director's relative is goverened by which section and what is the limit?