Harish Naidu (Job) (193 Points)
23 March 2011Hi, I am a Director in Private Limited company and I have 10000 shares. Can I pledge some of the shares to company and avail a loan from company. If I can pledge, please help me out with provisions of pledge of shares with maximum and minimum limits. Authorised capital of the company is 65,00,000.
Jaideep
(Service)
(1368 Points)
Replied 23 March 2011
Hi Harsih Sir,
Such pledging is not allowed. As private compnay, section 295 is not applicable and you can avail loan directly form the Compnay without pledging or providing any security.
Regards
Jaideep Pandya
Harish Naidu
(Job)
(193 Points)
Replied 23 March 2011
Thanks for the reply Jaideep, please check the below link, a member said there is a chance, but he has not replied after that. Please check and let me know,
/experts/pledging-of-shares-610570.asp
Jaideep
(Service)
(1368 Points)
Replied 23 March 2011
As per section 77 of the Compnaies Act, No company limited by shares, and no company, shall have power to buy its own shares, unless the consequent reduction of capital is effected.
Accordingly, Pledging of shares is not allowed with the same compnay.
Regards
Jaideep Pandya
Live class on PF & ESI Enrollment & Returns Filing(with recording)
CAclubindia
