Dear All
A listed public company (A) is holding more than 80 % share in a pvt. co.(B). Now A wants to make loan to B. What wud b the applicable provisions. If in case anybody have a draft resolution pls attach.
Thanks & Regards,
Amisha (Asst. Company Secretary) (205 Points)
24 March 2011Dear All
A listed public company (A) is holding more than 80 % share in a pvt. co.(B). Now A wants to make loan to B. What wud b the applicable provisions. If in case anybody have a draft resolution pls attach.
Thanks & Regards,
SANTOSH SHAH
(Company Secretary)
(754 Points)
Replied 24 March 2011
Originally posted by : Amisha | ||
Dear All A listed public company (A) is holding more than 80 % share in a pvt. co.(B). Now A wants to make loan to B. What wud b the applicable provisions. If in case anybody have a draft resolution pls attach. Thanks & Regards, |
Hi Amisha
Please refer the provisions of Section 372 A of companies act.
Its case of Inter-Corporate Loan, the loan made is subject to the limits as per section 372A.
It should not exceed 60% of Paid up sharecapital + free reserves or 100% of its free reserves which ever is higher.
Other views welcome.
regards
Santosh Shah
Jayashree S Iyer
(Company Secretary)
(3224 Points)
Replied 24 March 2011
I would like to add further that any loan exceeding the limits specified as above shall be made subject to previous authorisation by a special resolution passed in a general meeting.
Amisha
(Asst. Company Secretary)
(205 Points)
Replied 24 March 2011
Hi
Thanks Santosh & Thanks Jayshree.
Regards,
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