Sec 295 of Co.s Act

Please clarify the situation how Section 295 is applicable in ur co. from ur problem it seems the case of 372A.

A pvt ltd gave corporate guarantee on 21.07.10 for B pvt ltd in which Mr. X is a common director. Since A was a pvt co. sec 295 was not applicable. on 18.07.2011 A pvt. ltd. converted to A Ltd. Till this time the guarantee still prevailed. Now does A require to fulfil sec 295 conditions?

I think u r problem is common director but loan taken by B Ltd for its own benefit and such loan not taken by Director. I m right ?

yes loan has been taken by the co., not director. but sec 295(1)c provides loan/guarantee given to any pvt co. of which such director is a director. so by that provision sec 295 becomes applicable once A converts into public ltd co.

Dear Anny jain

As per sec-295 if any exempted company ia later converted into ltd company in such case sec will not apply