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Loan from Directors

Akash V.R. (Student) (23 Points)

12 March 2020

Since a private company has a very low CIBIL score, the bank is agreeing to give loan in the name of a director based on the company's performance. Can this loan be recorded in the company's name? Please guide me with reference to deposit rules.

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CS Rashi Jain (Practicing Company Secretary @ RASHI JAIN & ASSOCIATES) (1295 Points)
Replied 19 March 2020

A company can take loan from its director but the director has not borrowed that money from anywhere.
And in that case Director will submit a declaration with the Company that amount is not being given out of funds acquired by him by borrowing or accepting loans or deposits from others.

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Agnes Walker (AW) (22 Points)
Replied 08 April 2020

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