query regarding sec 295 (Loans to Directors)

Amisha (Asst. Company Secretary)   (205 Points)

25 March 2010  

Hi friends.. I have the following query.. pls advise

There is one Listed Company "A" Ltd and one closely held Public Company "B" Ltd.
Now A ltd has taken a Loan from bank and B ltd on behalf of A ltd given a Gurantee to Bank for the said loan.
One of the Director in A and B ltd is common. He act as chairman in B ltd and is an independent Director of A ltd.

Also the Holding of Director in Both the company is between 1 - 2 %

 Now my Question is whether Sec 295(Loans to Directors) is attracted or not

 

Thanks in Advance

Amisha