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loan from society to private limited

CA Ruchir Kaushik (SR. Analyst) (31 Points)

15 May 2018

can a society whose members are also directors in a Pvt Ltd can give loan to that private limited

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CA Sunil Kumar (Chartered Accountant) (4524 Points)
Replied 15 May 2018

Companies Act 2013 has brought a major change in the borrowing provisions for private companies and removed shareholders and relatives of directors from the list of lenders. Going forward the private companies can borrow only from directors apart from banks and financial institutions provided the director gives a declaration that the amount that he is giving is not out of borrowed funds.