The document provides information on the MCA notification dated 12th September 2013 notifying 98 new sections under the Companies Act 2013. Key points include:
- The MCA notification brought 98 new sections of the Companies Act 2013 into force from 12th September 2013.
- The notification clarifies that corresponding provisions of the Companies Act 1956 for these 98 sections notified under the new act will cease to apply from 12th September 2013.
- Some of the sections notified include those relating to loans to directors and related parties, inter-corporate loans and investments, and borrowings.
- The document provides details on the meaning and implications of these new sections.
The document defines a company according to Indian law and outlines some key features:
1) A company is an artificial person created by law with a separate legal entity and perpetual succession.
2) Key features of a company include that it is an artificial person, has separate legal entity, perpetual succession, separate property, common seal, and limited liability.
3) The corporate veil can be lifted by courts to identify individuals responsible for fraud.
The document provides information on key aspects of the Companies Act, 2013 and draft rules relating to types of companies, private companies, public companies, one person companies, and requirements for company names and memorandums. Some of the key points summarized:
- It introduces the concept of a One Person Company for the first time, with requirements that it must have one natural person as a member who is an Indian citizen.
- Private companies must restrict share transfers and limit members to 50, while public companies must have a minimum paid-up capital of Rs. 5 lakhs and no restriction on members.
- The memorandum must state the company name and objects, liability, share capital details, and in case of
The document summarizes key provisions around independent directors, women directors, related party transactions, corporate social responsibility committees, and other committees under the Companies Act 2013 in India. It outlines requirements for independent directors, qualifications for independent directors, their term and appointment process. It also discusses provisions around having a woman director, defining related parties and transactions with them, and mandatory committees around corporate social responsibility, audits, nominations and remuneration, and stakeholders' relationship.
Section 185 of the Companies Act 2013 places restrictions on companies providing loans, guarantees or security to directors and other persons in whom a director has an interest. It prohibits such transactions directly or indirectly, with some exceptions. These include loans to directors as part of service conditions approved by shareholders, or loans provided in the ordinary course of business at an interest rate of at least the bank rate. The document discusses the scope of persons covered under "interest of a director" and provides examples to illustrate its application. It also notes the penalties for non-compliance and a clarification that section 185 will not apply to guarantees provided by holding companies to subsidiaries for loans taken before the section was notified.
Section 185,186,188 of companies act, 2013arpit1314
The document discusses related party transactions, loans to directors, and loans/investments by companies under the Companies Act 2013. It defines related parties and key managerial personnel. It outlines the limits and approval processes for related party transactions involving sale/purchase of goods, property transactions, service contracts, and appointments. It also discusses the provisions around loans to directors and other persons in whom a director is interested, and the penalties for non-compliance. Finally, it covers the limits, approvals and disclosures required for loans and investments made by companies.
The document defines a company according to Indian law and outlines some key features:
1) A company is an artificial person created by law with a separate legal entity and perpetual succession.
2) Key features of a company include that it is an artificial person, has separate legal entity, perpetual succession, separate property, common seal, and limited liability.
3) The corporate veil can be lifted by courts to identify individuals responsible for fraud.
The document provides information on key aspects of the Companies Act, 2013 and draft rules relating to types of companies, private companies, public companies, one person companies, and requirements for company names and memorandums. Some of the key points summarized:
- It introduces the concept of a One Person Company for the first time, with requirements that it must have one natural person as a member who is an Indian citizen.
- Private companies must restrict share transfers and limit members to 50, while public companies must have a minimum paid-up capital of Rs. 5 lakhs and no restriction on members.
- The memorandum must state the company name and objects, liability, share capital details, and in case of
The document summarizes key provisions around independent directors, women directors, related party transactions, corporate social responsibility committees, and other committees under the Companies Act 2013 in India. It outlines requirements for independent directors, qualifications for independent directors, their term and appointment process. It also discusses provisions around having a woman director, defining related parties and transactions with them, and mandatory committees around corporate social responsibility, audits, nominations and remuneration, and stakeholders' relationship.
Section 185 of the Companies Act 2013 places restrictions on companies providing loans, guarantees or security to directors and other persons in whom a director has an interest. It prohibits such transactions directly or indirectly, with some exceptions. These include loans to directors as part of service conditions approved by shareholders, or loans provided in the ordinary course of business at an interest rate of at least the bank rate. The document discusses the scope of persons covered under "interest of a director" and provides examples to illustrate its application. It also notes the penalties for non-compliance and a clarification that section 185 will not apply to guarantees provided by holding companies to subsidiaries for loans taken before the section was notified.
Section 185,186,188 of companies act, 2013arpit1314
The document discusses related party transactions, loans to directors, and loans/investments by companies under the Companies Act 2013. It defines related parties and key managerial personnel. It outlines the limits and approval processes for related party transactions involving sale/purchase of goods, property transactions, service contracts, and appointments. It also discusses the provisions around loans to directors and other persons in whom a director is interested, and the penalties for non-compliance. Finally, it covers the limits, approvals and disclosures required for loans and investments made by companies.
The document discusses sources of company law in Malaysia and the classification of companies. It covers the main legislation governing companies, types of companies based on liability of members (limited by shares, limited by guarantee, unlimited), status (private, public), relationship to other companies (holding, subsidiary), and place of incorporation (local, foreign). It also discusses promoters, pre-registration contracts, and how a company can ratify or disclaim such contracts after incorporation.
This document is a circular to shareholders regarding proposed renewals and new mandates for recurrent related party transactions of a revenue or trading nature by Pos Malaysia Berhad. It provides details on the principal activities of Pos Malaysia Group, classes of related parties, nature and terms of the recurrent related party transactions, review procedures, rationale and benefits. Shareholders' approval is sought for the proposed renewals and new mandates at the upcoming AGM to authorize such related party transactions during the proposed mandate period, subject to renewal annually.
This document defines and describes 13 different types of companies under Indian law:
1) Private and public companies based on share capital, membership, and invitation to the public.
2) Statutory companies formed by special acts of Parliament or state legislatures.
3) Registered companies incorporated under the Companies Act.
4) Limited liability companies that are limited by shares or guarantee.
5) Unlimited companies with no limit on member liability.
6) Government companies with majority government shareholding.
7) Foreign companies conducting business in India.
8) Holding and subsidiary company relationships based on shareholding and control.
9) Investment companies that primarily acquire shares and securities.
10) Public financial institutions
The document discusses various aspects related to directors of a company under Indian law. It defines a director and outlines the minimum and maximum number of directors a company can have. It discusses the types of directors like independent, nominee, and alternate directors. It covers the appointment, tenure, duties, and removal of directors. The key ways directors can be appointed include by shareholders, board of directors, third parties, and the central government.
Section 185 and 186 - Loans and Investments by CompanySaurabh Dugar
Investments by company - Section 185 and 186 of Companies Act, 2013
Procedural Aspects, carve outs, implication of violations, etc.
Have included the probe of the proposed changes of Companies (Amendment) Bill, 2016.
The document discusses various sources and classifications of company law in Malaysia. It covers the main legislation governing companies, classification of companies according to liability of members (limited by shares, limited by guarantee, unlimited), status (private, public), relationship to other companies (holding, subsidiary), and type of business. It also summarizes incorporation of companies, who promoters are and their fiduciary duties, and treatment of pre-registration contracts under common law and the Companies Act 1965.
2018 was an interesting year for legal changes in corporate, finance and technology sector and the “Way of Doing Business” in India which dominated the headlines and we can expect 2019 to continue in the same way. Our article- Key Legal Developments in 2018 highlights some of the key legal changes of 2018 that you should take the time to understand and be prepared for. It’s important for any business owner to be aware of the changes affecting their business & put in place suitable safeguards. Failing to be prepared is often costly in terms of money, resource & time.
Forest Glade Estate - Draft Memorandum of IncorporationAdriaan Gie
This document is a memorandum of incorporation for The One Hundred and Three Home Owners Association NPC. It outlines the association's name, objectives, powers, membership, financial obligations of members, and governance structure including directors and meetings. The key points are:
- The association promotes and manages the collective interests of its members regarding their common property and determines and collects levies.
- Membership is limited to owners of private erven, who have financial obligations to the association including contribution to assets and payment of levies.
- Governance includes a board of directors, annual general meetings, notice procedures, quorum rules, and voting procedures. The directors are responsible for the association's functions and powers.
Define the term “principal officer” in the Companies Act - Dr S. ChandrasekaranD Murali ☆
Define the term “principal officer” in the Companies Act - Dr S. Chandrasekaran - Article published in Business Advisor, dated February 25, 2017 - http://www.magzter.com/IN/Shrinikethan/Business-Advisor/Business/
Companies act, 2013 related party transactionsRama Krishna
The document discusses key aspects of related party transactions under the Companies Act 2013. It provides definitions of related parties and related party transactions. It covers the rules around loans to directors and other persons. It also discusses the provisions around inter-corporate loans and investments including approval requirements, limits, exceptions and penalties. Key highlights include expanded definition of related parties, prohibition on loans to directors except in certain cases, limits on inter-corporate investments up to 60% of net worth without shareholder approval and maintaining a register of loans and investments.
The document discusses related party transactions under the Companies Act 2013. It defines related parties and related party transactions. Key points include:
- Related parties include directors, KMPs, relatives, firms/companies where a director/KMP is interested.
- Strict restrictions on companies providing loans, guarantees or security to directors and other related parties without approval.
- Exceptions provided for loans to MD/WTD as part of service conditions and loans between holding and subsidiary companies.
- Approval and disclosure requirements for related party transactions.
Companies amendment bill 2014 (highlights)Mayur Buha
The document summarizes key proposed amendments to the Companies Act 2013 based on the Companies (Amendment) Bill 2014 passed by the Lok Sabha. Some key points include:
- Removing the minimum paid-up capital requirement for public and private companies.
- Making common seals optional for companies.
- Introducing specific penalties for violations of deposit acceptance provisions.
- Certain board resolutions will no longer be publicly available for inspection.
- Requiring companies to set off previous losses and depreciation before declaring dividends.
- Introducing thresholds for auditor reporting of fraud to the central government.
- Providing additional exemptions to restrictions on loans to directors under section 185.
- Replacing the requirement for
Memorandum of incorporation approved 26 11 13Adriaan Gie
The memorandum of incorporation is for The One Hundred and Three Home Owners Association NPC. It establishes the association to manage collective interests for its members regarding common property. Key details include:
- Membership is limited to owners of the 206 cluster and garage erven.
- The association has powers to collect levies from members and maintain common areas.
- Directors are appointed to manage the association and collect funds.
- General meetings allow members to vote on important issues like levies.
- Rules govern members' use of common areas and obligations to the association.
The memorandum of incorporation is for The One Hundred and Three Home Owners Association NPC. It establishes the association to manage collective interests for its members regarding common property. Key details include:
- Membership is limited to owners of the 206 cluster and garage erven.
- The association has powers to collect levies from members and maintain common areas.
- Directors are appointed to manage the association and collect funds.
- General meetings allow members to vote on important issues like levies.
- Rules govern members' use of common areas and obligations to the association.
The SEBI has notified new listing regulations that consolidate existing listing rules and align them with the Companies Act of 2013. The regulations replace all previous listing agreements and will be effective 90 days after publication. Two provisions regarding related party transactions and reclassification of promoters will apply immediately. The regulations divide content into substantive provisions and procedural schedules. Listed companies must sign a new shortened listing agreement within six months and the regulations apply to all listed securities on stock exchanges.
1 impact of companies act, 2013 on private companiesLokesh Sharma
The document compares key provisions relating to private companies under the Companies Act of 1956 and the new Companies Act of 2013. It finds that the 2013 Act has significantly reduced exemptions and increased compliance requirements for private companies. Notable changes include restricting the maximum number of members to 200, prohibiting acceptance of unsecured loans from relatives of directors, and mandating appointment of key managerial personnel for companies with paid-up capital over Rs. 5 crores. Overall, private companies now have to comply with many provisions that previously only applied to public companies.
The document summarizes some of the key changes introduced in the Companies Act 2013 relating to incorporation, board meetings, share capital, directors, charges, and annual general meetings. Some notable changes include the introduction of one person companies, increased requirements for women directors and independent directors, stricter rules for board meetings, and greater disclosure requirements. Penalties for non-compliance have also been increased substantially under the new Act.
COMPARATIVE STATEMENT OF PRIVATE LIMITED COMPANY AND A SIGLE MEMBER COMPANY IN PAKISTAN
In Pakistan Companies could be form in many ways; for running a business registered under the federal statue, there are two popular ways to incorporate a company where liabilities are limited to its shares; one way is to form a Private Limited company; other way is to form Single Member Company and both are convertible into other kind (upward or downward as case may be) referring to Section 47 of the Companies Act, 2017 hereafter called as Act;
This document summarizes Section 185 of the Companies Act, 2013 regarding loans to directors. It discusses the restrictions placed on companies from advancing loans or providing security to directors. It outlines two exceptions for loans to managing/whole-time directors or loans provided in the ordinary course of business. It also clarifies the meaning of "person in whom director is interested." Finally, it summarizes a circular clarifying that Section 372A exemptions still apply regarding guarantees by holding companies for subsidiaries until Section 186 is notified.
The hotel unit introduced several new technologies and systems to improve the guest and customer experience. QR code based scanner menus were placed in rooms for easier access to entertainment options. A coupon system was implemented at the bar to reduce cash transactions and crowds, especially on weekends. Finally, the unit started using system-generated electronic KOTs through their POS system instead of manual paper KOTs across all outlets, with KOTs now attached to invoices.
The document discusses three adjudication orders issued by Registrars of Companies (ROCs) for non-compliance with the Companies Act, 2013 by various companies.
The first order imposed penalties on ERIS HEALTHCARE PRIVATE LIMITED and its directors for failing to file Form MGT-14 with the ROC regarding a resolution passed to provide loan to a subsidiary, violating Section 117 read with Section 185.
The second order imposed penalties on GSHP MUTUAL BENEFIT INDIA LIMITED for defaulting on filing its financial statements for FY 2019-20 as required under Section 137.
The third order imposed penalties on JAGDISH SILK MILLS PRIVATE LIMITED for not
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3) Registered companies incorporated under the Companies Act.
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The document discusses various aspects related to directors of a company under Indian law. It defines a director and outlines the minimum and maximum number of directors a company can have. It discusses the types of directors like independent, nominee, and alternate directors. It covers the appointment, tenure, duties, and removal of directors. The key ways directors can be appointed include by shareholders, board of directors, third parties, and the central government.
Section 185 and 186 - Loans and Investments by CompanySaurabh Dugar
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The document discusses various sources and classifications of company law in Malaysia. It covers the main legislation governing companies, classification of companies according to liability of members (limited by shares, limited by guarantee, unlimited), status (private, public), relationship to other companies (holding, subsidiary), and type of business. It also summarizes incorporation of companies, who promoters are and their fiduciary duties, and treatment of pre-registration contracts under common law and the Companies Act 1965.
2018 was an interesting year for legal changes in corporate, finance and technology sector and the “Way of Doing Business” in India which dominated the headlines and we can expect 2019 to continue in the same way. Our article- Key Legal Developments in 2018 highlights some of the key legal changes of 2018 that you should take the time to understand and be prepared for. It’s important for any business owner to be aware of the changes affecting their business & put in place suitable safeguards. Failing to be prepared is often costly in terms of money, resource & time.
Forest Glade Estate - Draft Memorandum of IncorporationAdriaan Gie
This document is a memorandum of incorporation for The One Hundred and Three Home Owners Association NPC. It outlines the association's name, objectives, powers, membership, financial obligations of members, and governance structure including directors and meetings. The key points are:
- The association promotes and manages the collective interests of its members regarding their common property and determines and collects levies.
- Membership is limited to owners of private erven, who have financial obligations to the association including contribution to assets and payment of levies.
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The document discusses related party transactions under the Companies Act 2013. It defines related parties and related party transactions. Key points include:
- Related parties include directors, KMPs, relatives, firms/companies where a director/KMP is interested.
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The document summarizes key proposed amendments to the Companies Act 2013 based on the Companies (Amendment) Bill 2014 passed by the Lok Sabha. Some key points include:
- Removing the minimum paid-up capital requirement for public and private companies.
- Making common seals optional for companies.
- Introducing specific penalties for violations of deposit acceptance provisions.
- Certain board resolutions will no longer be publicly available for inspection.
- Requiring companies to set off previous losses and depreciation before declaring dividends.
- Introducing thresholds for auditor reporting of fraud to the central government.
- Providing additional exemptions to restrictions on loans to directors under section 185.
- Replacing the requirement for
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The memorandum of incorporation is for The One Hundred and Three Home Owners Association NPC. It establishes the association to manage collective interests for its members regarding common property. Key details include:
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- The association has powers to collect levies from members and maintain common areas.
- Directors are appointed to manage the association and collect funds.
- General meetings allow members to vote on important issues like levies.
- Rules govern members' use of common areas and obligations to the association.
The memorandum of incorporation is for The One Hundred and Three Home Owners Association NPC. It establishes the association to manage collective interests for its members regarding common property. Key details include:
- Membership is limited to owners of the 206 cluster and garage erven.
- The association has powers to collect levies from members and maintain common areas.
- Directors are appointed to manage the association and collect funds.
- General meetings allow members to vote on important issues like levies.
- Rules govern members' use of common areas and obligations to the association.
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In Pakistan Companies could be form in many ways; for running a business registered under the federal statue, there are two popular ways to incorporate a company where liabilities are limited to its shares; one way is to form a Private Limited company; other way is to form Single Member Company and both are convertible into other kind (upward or downward as case may be) referring to Section 47 of the Companies Act, 2017 hereafter called as Act;
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The hotel unit introduced several new technologies and systems to improve the guest and customer experience. QR code based scanner menus were placed in rooms for easier access to entertainment options. A coupon system was implemented at the bar to reduce cash transactions and crowds, especially on weekends. Finally, the unit started using system-generated electronic KOTs through their POS system instead of manual paper KOTs across all outlets, with KOTs now attached to invoices.
The document discusses three adjudication orders issued by Registrars of Companies (ROCs) for non-compliance with the Companies Act, 2013 by various companies.
The first order imposed penalties on ERIS HEALTHCARE PRIVATE LIMITED and its directors for failing to file Form MGT-14 with the ROC regarding a resolution passed to provide loan to a subsidiary, violating Section 117 read with Section 185.
The second order imposed penalties on GSHP MUTUAL BENEFIT INDIA LIMITED for defaulting on filing its financial statements for FY 2019-20 as required under Section 137.
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Denis is a dynamic and results-driven Chief Information Officer (CIO) with a distinguished career spanning information systems analysis and technical project management. With a proven track record of spearheading the design and delivery of cutting-edge Information Management solutions, he has consistently elevated business operations, streamlined reporting functions, and maximized process efficiency.
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Date: May 29, 2024
Tags: Information Security, ISO/IEC 27001, ISO/IEC 42001, Artificial Intelligence, GDPR
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LAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UPRAHUL
This Dissertation explores the particular circumstances of Mirzapur, a region located in the
core of India. Mirzapur, with its varied terrains and abundant biodiversity, offers an optimal
environment for investigating the changes in vegetation cover dynamics. Our study utilizes
advanced technologies such as GIS (Geographic Information Systems) and Remote sensing to
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of extensive research and worry. As the global community grapples with swift urbanization,
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The utilization of land is impacted by human needs and environmental factors. In countries
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diverse human activities.
Accurate understanding of land use and cover is imperative for the development planning
of any area. Consequently, a wide range of professionals, including earth system scientists, land
and water managers, and urban planners, are interested in obtaining data on land use and cover
changes, conversion trends, and other related patterns. The spatial dimensions of land use and
cover support policymakers and scientists in making well-informed decisions, as alterations in
these patterns indicate shifts in economic and social conditions. Monitoring such changes with the
help of Advanced technologies like Remote Sensing and Geographic Information Systems is
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Remote Sensing and Geographic Information Systems
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Changes in vegetation cover refer to variations in the distribution, composition, and overall
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Chapter wise All Notes of First year Basic Civil Engineering.pptxDenish Jangid
Chapter wise All Notes of First year Basic Civil Engineering
Syllabus
Chapter-1
Introduction to objective, scope and outcome the subject
Chapter 2
Introduction: Scope and Specialization of Civil Engineering, Role of civil Engineer in Society, Impact of infrastructural development on economy of country.
Chapter 3
Surveying: Object Principles & Types of Surveying; Site Plans, Plans & Maps; Scales & Unit of different Measurements.
Linear Measurements: Instruments used. Linear Measurement by Tape, Ranging out Survey Lines and overcoming Obstructions; Measurements on sloping ground; Tape corrections, conventional symbols. Angular Measurements: Instruments used; Introduction to Compass Surveying, Bearings and Longitude & Latitude of a Line, Introduction to total station.
Levelling: Instrument used Object of levelling, Methods of levelling in brief, and Contour maps.
Chapter 4
Buildings: Selection of site for Buildings, Layout of Building Plan, Types of buildings, Plinth area, carpet area, floor space index, Introduction to building byelaws, concept of sun light & ventilation. Components of Buildings & their functions, Basic concept of R.C.C., Introduction to types of foundation
Chapter 5
Transportation: Introduction to Transportation Engineering; Traffic and Road Safety: Types and Characteristics of Various Modes of Transportation; Various Road Traffic Signs, Causes of Accidents and Road Safety Measures.
Chapter 6
Environmental Engineering: Environmental Pollution, Environmental Acts and Regulations, Functional Concepts of Ecology, Basics of Species, Biodiversity, Ecosystem, Hydrological Cycle; Chemical Cycles: Carbon, Nitrogen & Phosphorus; Energy Flow in Ecosystems.
Water Pollution: Water Quality standards, Introduction to Treatment & Disposal of Waste Water. Reuse and Saving of Water, Rain Water Harvesting. Solid Waste Management: Classification of Solid Waste, Collection, Transportation and Disposal of Solid. Recycling of Solid Waste: Energy Recovery, Sanitary Landfill, On-Site Sanitation. Air & Noise Pollution: Primary and Secondary air pollutants, Harmful effects of Air Pollution, Control of Air Pollution. . Noise Pollution Harmful Effects of noise pollution, control of noise pollution, Global warming & Climate Change, Ozone depletion, Greenhouse effect
Text Books:
1. Palancharmy, Basic Civil Engineering, McGraw Hill publishers.
2. Satheesh Gopi, Basic Civil Engineering, Pearson Publishers.
3. Ketki Rangwala Dalal, Essentials of Civil Engineering, Charotar Publishing House.
4. BCP, Surveying volume 1
2. Contents
MCA notification notifying 98 new sections under CA 2013
Sections relating to loans
Loans to directors & related parties
Inter-corporate loans & investments
Borrowings
Practical questions
3. MCA Notification dated 12.9.2013
In exercise of the powers conferred by sub-section (3) of
section 1 of the Companies Act 2013 (18 of 2013), the Central
Government hereby appoints the 12th day of September
2013 as the date on which the following provisions of the
said Act shall come into force, namely:
…..
….
Sd/-
RENUKA KUMAR
Joint Secretary to the Government of India
4. MCA circular dated 18.9.2013
on notification of 98 new sections
This Ministry had issued a notification on 12.09.2013 bringing into
force to 98 sections or part thereof of the Companies Act 2013.
The said notification is available on Ministry’s website. This
Ministry has been receiving requests for clarification as to
whether the provisions of the Companies Act 1956 corresponding
to such 98 sections would continue to apply or not.
It is hereby clarified that with effect from 12.09.2013, the relevant
provisions of the Companies Act 1956, which correspond to
provisions of 98 sections of the Companies Act 2013 brought into
force on 12.09.2013 cease to have effect from that date.
This issues with the approval of the competent authority.
5. Sections relating to loans
CA 1956 CA 2013 Date of
notification
Loans to directors etc. 295, 296 12/9/2013
Definitions
a) Body corporate
b) Relatives
2(7),
2(41)
--do—
--do--
Restrictions on powers
of Board
293 --do--
Powers of Board 179 Yet to be notified
Inter-corporate loans &
investments
186 --do--
Acceptance of deposits 2(31), 73, 74 --do--
6. Sections 295/296 of CA 1956
(upto 11.9.2013)
Sec. 185 of CA
2013
Specified
related
parties
(SRPs)
1. Any director of the lending co. or of a co. which
is its holding co.
2. Any partner or relative of any such director
3. Any firm in which any such director or relative
is a partner
4. Any private company of which any such director
is a director or member
5. Any body corporate at a general meeting of
which not less than 25% of total voting power
may be exercised or controlled by any such
director or by 2 or more such directors together
6. Any body corporate, the Board, MD or Manager
whereof is accustomed to act in accordance with
the directors or instructions of the Board or of
any director(s) of lending company
No change.
Loans to directors & related parties
7. Sections 295/296 of CA 1956
(upto 11.9.2013)
Sec. 185 of CA 2013
Applicability 1. Direct or indirect loans (including
loans represented by book debts) to
specified related parties (SRPs)
2. Guarantee/security in connection with
loan made by any other person to SRPs
3. Guarantee/security in connection with
loan to any other person by SRPs
Nos. 1 and 2 are
same. But No.3
deleted.
Procedure Approval of Central Govt. required.
E-Form 24-AB to be filed.
Sec.292: Power to make loan can be
exercised only at Board meeting (and not
by circulation)
a) If covered in
exemptions:
Board resolution.
2) If not covered in
exemptions:
Strictly prohibited.
No provision for CG
approval.
Loans to directors & related parties
8. Sections 295/296 of CA 1956
(upto 11.9.2013)
Sec. 185 of CA 2013
Exemption a) Loan made or
guarantee/security given:
i. By Private companies
(unless subsidiary of public co.)
ii. By banking companies
b) Loan by holding co. to
subsidiary
c) Guarantee/security by holding
co. for loan to subsidiary co.
[As per Notification No.GSR 729 dated
24.5.1978 not applicable to Govt companies
if approval of concerned Ministry is
obtained.]
a) Loan to MD or WTD
i. As a part of conditions of service
extended by co. to all its
employees, or
ii. Pursuant to any scheme approved
by members by special resolution
b) A company which in the
ordinary course of business
provides loans or gives
guarantee/ security for due
repayment of loan and interest
is charged at not less than
bank rate declared by RBI.
Loans to directors & related parties
9. Sections 295/296 of CA 1956
(upto 11.9.2013)
Sec. 185 of CA 2013
Penal
provisions
1. Fine upto Rs.50,000 or simple
imprisonment upto 6 months
[Sec.295(4)]. Exemption from
imprisonment in case loan has
been repaid.
2. Office of the director
concerned will become vacant u/s
283(1)(h).
Imprisonment upto 6 months
or fine not less than Rs.5 lacs
but may extend to Rs.25 lacs or
with both.
No provision for exemption
from imprisonment even if loan
has been repaid.
Loans to directors & related parties
10. Mere inclusion in the Objects Clause of Memorandum is not sufficient
Lending by a banking company or an NBFC could be in the ordinary course
of business (but not in case of purely an investment company)
If the company lends not only to SRPs but also to unrelated parties on arms’
length basis, this could be considered as ‘in the regular course of business’.
Regularity and frequency of transactions could be an important criteria
Meaning of ‘in the ordinary course of business’
in Section 185 of CA 2013
11. Meaning of ‘Save as otherwise provided in this Act’
in Section 185 of CA 2013
Only other Section dealing with loans in CA 2013 is Section 186 which is yet
to be notified. Its corresponding Section 372A in CA 1956 is in force.
Both Sections 372A of CA 1956 and 186 of CA 2013 do not deal with specified
related parties and hence conflict of interest may or may not be there.
Since Section 185 deals with cases where conflict of interest is there, it will
prevail over provisions of Sec.372A of CA 1956.
Hence it may be said that there is no impact of the term ‘Save as otherwise
provided in this Act’ in Section 185 of CA 2013.
12. Definition of ‘body corporate’
Section 2(7) of 1956 Act:
“body corporate” or ‘corporation’
includes a company incorporated
outside India but does not include—
a) A corporation sole;
b) A cooperative society registered
under any law relating to
cooperative societies; and
c) Any other body corporate (not
being a company as defined in
this Act) which the Central
Govt. may by notification in the
Official Gazette, specify in that
behalf.
Section 2(11) of 2013 Act:
Same
[except that (a) – a corporation sole
deleted]
General characteristics:
- Incorporated under some law
- Perpetual succession
- Common seal
- Legal entity apart from the
members
13. Definition of ‘body corporate’
Examples of ‘body corporates’:
1. All companies registered under
Indian Companies Act
2. All companies registered under
any Act outside India
3. Any Corporation registered under
any special law in India or abroad
4. Public financial institutions u/s
4A of Companies Act 1956
5. Nationalised banks incorporated
under Banking Companies
(Acquisition & Transfer of
Undertakings) Act 1970
6. LLPs
These are not bodies corporates:
1. Proprietorship concerns
2. Partnership firms (other than
LLPs)
3. HUFs
4. Societies registered under
Societies Registration Act
5. Mutual funds managed by
trustees (except UTI)
14. Definition of ‘relatives’
under CA 1956
Section 2(41):
“relative” means, with reference to any
person, any one who is related to such
person in any of the ways specified in
section 6, and no others.
Section 6:
A person shall be deemed to be a relative of
another if, land only if, --
a) They are members of a Hindu
undivided family; or
b) They are husband and wife; or
c) The one is related to the other in the
manner indicated in Schedule 1A.
Schedule 1A [See Section 6(c)]
LIST OF RELATIVES
1. Father
2. Mother (including step-mother)
3. Son (including step son)
4. Son’s wife
5. Daughter (including step daughter)
6. Father’s father
7. Father’s mother
8. Mother’s mother
9. Mother’s father
10. Son’s son
11. Son’s son’s wife
12. Son’s daughter
13. Son’s daughter’s husband
14. Daughter’s husband
15. Daughter’s son
16. Daughter’s sons’s wife
17. Daughter’s daughter
18. Daughter’s daughter’s husband
19. Brother (including step-brother)
20. Brother’s wife
21. Sister (ioncluding step sister)
22. Sister’s husband
15. Definition of ‘relatives’
under CA 2013
Section 2(77):
“relative” with reference to any person,
means any one who is related to another,
if—
a) They are members of a Hindu
undivided family; or
b) They are husband and wife; or
c) One person is related to the other in
such manner as may be prescribed.
Thus it will be noticed that the following are proposed to be omitted
from list of relatives:
1. Son’s son’s wife
2. Son’s daughter’s husband
3. Daughter’s son
4. Daughter’s son’s wife
5. Daughter’s daughter
6. Daughter’s daughter’s husband
7. Brother’s wife
8. Sister’s husband
Draft Rule 1.4 (yet to be notified)
LIST OF RELATIVES
For the purpose of sub-clause (iii) of sub-section (77) of
Section 2, a person shall be deemed to be the relative of
another, if he or she is related to another in the following
manner:
1. Spouse
2. Father (including step father)
3. Father’s father
4. Father’s mother
5. Mother (including step-mother)
6. Mother’s mother
7. Mother’s father
8. Son (including step-son)
9. Son’s wife
10. Son’s son
11. Son’s daughter
12. Daughter (including step daughter)
13. Daughter’s husband
14. Brother (including step brother)
15. Sister (including step sister)
16. Meaning of ‘control’
Section 2(27) of Companies Act 2013:
“control” shall include the right to appoint majority of the
directors or to control the management or policy
decisions exercisable by a person or persons acting
individually or in concert, directly or indirectly, including
by virtue of their shareholding or management rights or
shareholders agreement or voting agreements or in any
other manner.”
17. Meaning of ‘Loans’
Loans vs. Deposits:
Loan is lending of money with absolute promise to repay. There is a difference between loan and deposit. However, courts have held
that for the purposes of Sec.295 of CA 1956 the difference is immaterial and the Section cannot be evaded by describing monies of a
company advanced to a director as deposits. Sec.372A of CA 1956 specifically provides that loan includes deposits. However, there is
no such mention in CA 2013.
Loans vs. advance:
There is a difference between loan and advance also. Loan is repayable whereas advance is to be adjusted
against supply of goods or services. Salary advance is an example. Advance is not covered under
restrictive provisions of Companies Act.
Whether subscription of debentures is a loan?
Subscription of debentures is not a loan u/s 185 of CA 2013. However, Sec.372A of CA 1956 specifically provides
that loan includes debentures.
Whether book debts could be loans?
If book debt is prolonged beyond usual credit period, it could be considered as a loan.
19. Section 462 of CA 2013
Power to exempt class or classes of companies from provisions of
this Act.
(1) The Central Government may in the public interest, by notification
direct that any of the provisions of this Act, --
(a) Shall not apply to such class or classes of companies; or
(b) Shall apply to the class or classes of companies with such exceptions,
modifications and adaptations as may be specified in the notification.
(2) …..”
Note: No exemption notification has been issued by MCA so far under Section 462
of CA 2013.
20. Section 2(22)(e) of Income Tax Act
relating to deemed dividend
Loan given to shareholder holding more than 10% of voting power could be deemed to be
dividend. Section 2(22)(e) of IT Act reads as under:
2. “In this Act, unless the context otherwise requires—
3. (22) ‘dividend’ includes:
(e) any payment by a company, not being a company in which the public are substantially
interested, of any sum (whether as representing a part of the assets of the company or
otherwise) [made after the 31st day of May, 1987, by way of advance or loan to a
shareholder, being a person who is the beneficial owner of shares (not being shares entitled
to a fixed rate of dividend whether with or without a right to participate in profits) holding
not less than ten per cent of the voting power, or to any concern in which such shareholder
is a member or a partner and in which he has a substantial interest (hereafter in this
clause referred to as the said concern)] or any payment by any such company on behalf, or
for the individual benefit, of any such shareholder, to the extent to which the company in
either case possesses accumulated profits ;
21. Section 2(22)(e) of Income Tax Act
relating to deemed dividend
but "dividend" does not include—
(i) a distribution made in accordance with sub-clause (c) or sub-clause (d) in respect of any share issued
for full cash consideration, where the holder of the share is not entitled in the event of liquidation to
participate in the surplus assets ;
(ia) a distribution made in accordance with sub-clause (c) or sub-clause (d) in so far as such distribution is
attributable to the capitalised profits of the company representing bonus shares allotted to its equity
shareholders after the 31st day of March, 1964, and before the 1st day of April, 1965 ;
(ii) any advance or loan made to a shareholder or the said concern by a company in the ordinary course of
its business, where the lending of money is a substantial part of the business of the company ;
(iii) any dividend paid by a company which is set off by the company against the whole or any part of any
sum previously paid by it and treated as a dividend within the meaning of sub-clause (e), to the extent to
which it is so set off;
[(iv) any payment made by a company on purchase of its own shares from a shareholder in accordance
with the provisions of section 77A5 of the Companies Act, 1956 (1 of 1956);
(v) any distribution of shares pursuant to a demerger by the resulting company to the shareholders of the
demerged company (whether or not there is a reduction of capital in the demerged company).
22. Section 2(22)(e) of Income Tax Act
relating to deemed dividend
Explanation 1.—The expression "accumulated profits", wherever it occurs in this clause, shall
not include capital gains arising before the 1st day of April, 1946, or after the 31st day of
March, 1948, and before the 1st day of April, 1956.
Explanation 2.—The expression "accumulated profits" in sub-clauses (a), (b), (d) and (e),
shall include all profits of the company up to the date of distribution or payment referred to in
those sub-clauses, and in sub-clause (c) shall include all profits of the company up to the date
of liquidation, 6[but shall not, where the liquidation is consequent on the compulsory
acquisition of its undertaking by the Government or a corporation owned or controlled by the
Government under any law for the time being in force, include any profits of the company
prior to three successive previous years immediately preceding the previous year in which
such acquisition took place.
Explanation 3.—For the purposes of this clause,—
(a) "concern" means a Hindu undivided family, or a firm or an association of persons or a
body of individuals or a company ;
(b) a person shall be deemed to have a substantial interest in a concern, other than a
company, if he is, at any time during the previous year, beneficially entitled to not less than
twenty per cent of the income of such concern ;
23. Extracts from RBI Act relating to
NBFC
Section 45-I:
(c) ‘financial institution’ means any non-banking institution which carries on as its business
or part of its business any of the following activities, namely ---
(i) the financing, whether by way of making loans or advances or otherwise, of any activity
other than its own;
(ii) the acquisition of shares, stocks, bonds, debentures or securities issued by a Government
or local authority or other marketable securities of a like nature;
(iii) …..
……..
but does not include any institution, which carries on as its principal business, ----
……
(b) Industrial activity, or
……
(f) ‘non-banking financial company’ means ---
(i) a financial institution which is a company; or
(ii) ……
24. Extracts from RBI Act relating to
NBFC
RBI Press Release dated 8.4.1999
The Reserve Bank of India on 8.4.1999 announced that in order to identify a particular
company as a NBFC, it will consider both, the assets and the income pattern as evidenced by
the last audited balance sheet of the company to decide its principal business. The
company will be treated as NBFC if its financial assets are more than 50 percent of
its total assets (netted off by intangible assets) and income from financial assets
should be more than 50 percent of the gross income. Both these tests are required to
be satisfied as the determinant factor for principal business of a company.
Section 45-IA:
(1) Notwithstanding anything contained in this Chapter or in any other law for the time
being in force, no non-banking financial company shall commence or carry on any business
of a non-banking financial institution without ---
a) Obtaining a certificate of registration issued under this Chapter; and
b) Having the net owned fund of twenty-five lakh rupees or such other amount, not
exceeding two hundred lakh rupees, as the Bank may, by notification in the official
gazette, specify.
25. Other points relating to loans/
guarantees
Loans may or may not carry interest
Excess remuneration paid could be treated as a loan
Sale on credit is not loan [Bombay High Court in Fredie Ardeshir Mehta v.
Union of India (1991)]
Whether letter of comfort is a guarantee?
Letter of comfort may involve moral obligation but not contractual obligation
and is not a guarantee and hence not covered under restrictive provisions of
the Act.
Government had issued guidelines on 12.11.1976 for loans to
directors for house building without approval of CG.
26.
27. Inter-corporate loans & investments
(Sec.372A)
Applicability 1. Loan to any other body corporate
2. Guarantee/security in connection with loan made by
any other person to any body corporate
3. Guarantee/security in connection with loan made to
any other person by any body corporate
4. Acquisition by way of subscription, purchase or
otherwise the securities of any other body corporate
Pre-condition No default u/s 58A
Ceiling
applicable
Without approval of members:
Upto 60% of paid-up share capital and free reserves of lending
company, or 100% of free reserves, whichever is more.
With approval of members:
Such limit as may be specified in the special resolution.
Restriction Co. cannot give loan for purchase of its own shares [Sec.77(2)]
28. Inter-corporate loans & investments
(Sec.372A) Contd…
Procedure a) Unanimous resolution of Board members present
b) Special resolution of shareholders (if applicable)
c) Prior approval of public financial institution u/s 4A
(if term loan is subsisting and there is default in
repayment of loan or payment of interest)
d) Entry in register of loans & investments within 7 days
Rate of interest Not lower than prevailing Bank rate prescribed by RBI
Exemption 1. Banking/insurance/housing finance co. in ordinary course
of business or a co. established with the object of financing
industrial enterprises, or of providing infrastructural
facilities
2. Co., whose principal business is acquisition of shares,
stock, debentures or other securities
3. Private co., unless it is subsidiary of a public co.
4. Investment made in pursuance of shares allotted u/s
81(1)(a) Contd…
29. Inter-corporate loans & investments
(Sec.372A) Contd…
Exemption 5. Loan by a holding co. to its wholly owned subsidiary
co.
6. Guarantee/security by holding co. in respect of loan
to its wholly owned subsidiary
7. Acquisition by holding co. the securities of its wholly
owned subsidiary
Penal provisions Imprisonment upto 2 years or fine upto Rs.50,000/-
(Rs.5,000 in case of default in connection with register of loans & investments +
Rs.5,000 per day in case of continuing default).
30. MCA circular dated 19.11.2013 on
Sec.372A
This Ministry has received number of representations
consequent upon notifying Section 185 of the Companies
Act 2013 dealing with loans to directors which is
corresponding to Section 295 of the Companies Act 1956.
Section 186 of the Companies Act 2013 is yet to be notified.
It is clarified that Section 372A of the Companies Act 1956
dealing with inter-corporate loans continue to remain in
force till section 186 of the Companies Act 2013 is notified.
This issues with the approval of competent authority.
31. MCA Valentine Day circular
dated 14.2.2014 on Sec.185 of CA 2013
This Ministry has received number of representations on the applicability of Section
185 of the Companies Act 2013 with reference to loans made, guarantee given or
security provided under Section 372A of the Companies Act 1956. The issue has been
examined with reference to applicability of Section 372A of the Companies Act 1956
vis-à-vis Section 185 of the Companies Act 2013. Section 372A of the Companies Act
1956 specifically exempts any loans made, any guarantee given or security provided
or any investment made by a holding company to its wholly owned subsidiary.
Whereas, Section 185 of the Companies Act 2013 prohibits guarantee given or any
security provided by a holding company in respect of any loan taken by its
subsidiary company except in the ordinary course of business.
2. In order to maintain harmony with regard to applicability of Section 372A of the
Companies Act 1956 till the same is repealed and Section 185 of the Companies Act
2013 is notified, it is hereby clarified that any guarantee given or security provided by
a holding company in respect of loans made by a bank or financial institution to its
subsidiary company, exemption as provided in clause (d) of sub-section (8) of
Section 372A of the Companies Act 1956 shall be applicable till Section 186 of the
Companies Act 2013 is notified. This clarification will, however, be applicable to
cases where loans so obtained are exclusively utilised by the subsidiary for its
principal business activities.
32. MCA circular dated 4.6.1999 on
section 372A
The provisions in the Companies Act, 1956, relating to inter-corporate investments, loans and
guarantees have been recently liberalised by the Government through Companies
(Amendment) Act, 1999. However, apprehensions have been expressed in some quarters with
regard to possible misuse of these provisions by companies. I shall, therefore, be grateful if the
chambers could draw the attention of their constituents to the following:
(i) The companies are expected to obtain the approval for making
investments into securities or grant of loan to other companies of amounts which are linked
with company’s available financial resources and the resolution, for investment much beyond
the networth should not be passed by the companies.
(ii) The companies should specifically indicate in the explanatory statement
to the resolution, the specific securities in which it is proposed to invest the amount. En bloc
approval should normally be avoided (except in the case of guarantee where the resolution
can indicate an amount on annual basis).
2. If the above broad parameters are not complied with, the Government will be constrained
to take suitable action against those who contravene these.
Circular : No. 8 of 1999, dated 4-6-1999.
33.
34. Borrowing
Ceiling on
borrowing
Without members approval:
Aggregate of paid-up capital and free reserves (apart from
temporary loans from bankers in ordinary course of business)
With members approval:
As specified in members resolution
[Ordinary resolution u/s 292(1)(c) of CA 1956 upto 11.9.2013 and special
resolution u/s 180(1)(c) of CA 2013 w.e.f. 12.9.2013 – applicable to private co.
also]
Care to be taken 1. Board resolution at Board meeting only (& not by circulation)
[Sec.292(1)(c) of CA 1956]
2. Check applicability of Section 58A read with Companies
(Acceptance of Deposits) Rules 1975 --
3. Co. cannot give loan for purchase of its own shares
4. Check applicability of Sec.14A of IT Act – disallowance of
interest on loan
5. Check Object clause of Memorandum
6. Check applicability of provisions of RBI Act for NBFC
7. Check RBI regulations in case of borrowing from foreign
company
8. Check position of current ratio & net worth
35. CBDT circular dated 11.2.2014
on disallowance u/s 14A of IT Act
Section 14A of the Income-tax Act 1961 (‘Act’) provides for disallowance of expenditure in
relation to income not ‘includible’ in total income.
2. A controversy has arisen in certain cases as to whether disallowance can be made by
invoking section 14A of the Act even in those cases where no income has been earned by
an assessee which has been claimed as exempt during the financial year.
3. The matter has been examined in the Board. It is pertinent to mention that section 14A
of the Act was introduced by the Finance Act 2001 with retrospective effect from
01.04.1962. The purpose for introduction of section 14A with retrospective effect since
inception of the Act was clarified vide Circular No.14 of 2001 as under:
“Certain incomes are not includible while computing the total income, as these are exempt under various provisions of the
Act. There have been cases where deductions have been claimed in respect of such exempt income. This in effect means that
the tas incentive given by way of exemptions to certain categories of income is being used to reduce aslo the tax payable on
the non-exempt income by debiting the exepenses incurred to earn the exempt income against taxable income. This is
against the basic principles of taxation whereby only the net income, i.e. gross income minus the expenditure, is taxed. On
the same analogy, the exemption is also in respect of the net income. Expenses incurred can be allowed only to the extent
they are relatable to the earning of such taxable income”.
36. Thus, legislative intent is to allow only that expenditure which is relatable to earning of
income and it therefore follows that the expenses which are relatable to earning of exempt
income have to be considered for disallowance, irrespective of the fact whether any such
income has been earned during the financial year or not.
4. The above position is further clarified by the usage of term ‘includible’ in the Heading to
section 14A of the Act and also the Heading to Rule 8D of I.T. Rules, 1962 which
indicates that it is not necessary that exempt income should necessarily be included in
a particular year’s income, for disallowance to be triggered. Also, section 14A of the Act
does not use the word ‘income of the year’ but ‘income under the Act’. This also
indicates that for invoking disallowance under section 14A, it is not material that
assessee should have earned such exempt income during the financial year under
consideration.
5. The above position is further substantiated by the language used in Rule 8D(2)(ii) &
8D(2)(iii) of I.T. Rules which are extracted below:
“(ii) in a case where the assessee has incurred expenditure by way of interest during the previous year which is not directly
attributable to any particular income or receipt an amount computed in accordance with the following formula, namely:
A*B/C
37. Where….
B= the average of value of investment, ;income from which does not or shallnot form part of
the total income as appearing the in the balance sheet of the assessee, on the first day and the
last day of the previous year;
……
(iii) An amount equal to one-half percent of the average of the value of investment, ;income
from which does not or shalll not form part of the total income, as appearing in the balance-
sheet of the assessee, on the first day and the last day of the previous year.”
(Emphasis added)
6. Thus in light of above, Central Board of Direct Taxes, in
exercise of its powers under section 119 of the Act hereby
clarifies that Rule 8D read with section 14A of the Act provides
for disallowance of the expenditure even where taxpayer in a
particular year has not earned any exempt income.
6. This may be brought to the notice of all concerned.
6. Hindi version to follow.
38. Rule 2(b)(ix)
of Companies (Acceptance of Deposits) Rules 1975
2. “In these rules, unless the context otherwise requires, ----
(a)….
(b) “deposit” means any deposit of money with, and includes any amount
borrowed by, a company, but does not include ----
……
(ix) Any amount received from a person who, at the time of receipt of the
amount, was a director of the company or any amount received from a
relative of a director or its member by a private company ----
Provided that the director, relative of a director or a member, as the case
may be, from whom money is received, furnishes to the company at the
time of giving the money, a declaration in writing to the effect that the
amount is not being given out of funds acquired by him by borrowing or
accepting from others;”
40. Q.1
Can ABC Ltd accept loan from:
a) Mr A, Director of the company
b) Mr B, Shareholder of the company
c) Mr C, Director & shareholder of the company
d) Mr E, son of MD of the company
41. Q.2
ABC Pvt Ltd granted loan to its employee Mr A on 1.10.2013 .
Subsequently, Mr A was appointed as a director of the
company. Is there any contravention?
42. Q.3
ABC Ltd gives loan to XYX Ltd. Mr A is a director in
both companies. Subsequently, XYZ Ltd is
converted into private limited company. Is there any
contravention of company law?
43. Q.4
Can ABC Ltd give corporate guarantee to bank for
giving loans to its wholly owned subsidiary abroad?
44. Q.5
ABC Private Ltd proposes to give loan to Mr A who is
sister’s husband of a director of the company. Is it
permitted u/s 185 of CA 2013?
45. Q.6
ABC Ltd proposes to give loan to a private limited company
incorporated in Germany. Mr A is a director in both
companies, but no director of ABC Ltd is holding any shares
of Germany company. Is it permitted u/s 185 of CA 2013?
46. Q.7
Mr A is a member of ABC Pvt Ltd and XYZ Pvt Ltd.
XYZ Pvt Ltd gives loan to Mr X. Can ABC Pvt Ltd
give guarantee for the loan?
47. Q.8
Mr A, who is director of ABC Ltd, is also a trustee of a public
charitable trust. The Trust requests the company to give
some loan. Can the company give loan to the Trust?
48. Q.9
Paid-up capital & free reserves of ABC Ltd are to the extent
of Rs.10 crores. However, ordinary resolution u/s 293(1)(d)
of CA 1956 has been passed permitting borrowing upto
Rs.15 crores. Accordingly, company borrowed by way of
term loan of Rs.12 crores on 1.9.2013. Repayment of term
loan will start from 1.4.2014. Is there any contravention?
49. Q.10:
In the above case, the company took a second term loan
of Rs.3 crores on 1.10.2013 by just passing Board
resolution. Is there any contravention?
50. Q.11
Paid-up capital and free reserves of ABC Ltd as on 31.3.2013
were to the tune of Rs.10 crores. Profit after tax of the
company for 9 months period ended 31.12.2013 was Rs.2
crores. Company wants to take term loan of Rs.12 crores in
February 2014. Can it do so by passing Board resolution?
51. Q.12
In the above example, can the company take Cash Credit
limit of Rs.12 crores from SBI instead of term loan of
Rs.12 crores by passing Board resolution?
52. Q.13
Paid-up capital and free reserves of ABC Ltd as on
31.3.2013 were to the tune of Rs.10 crores. Company had
taken term loan of Rs.10 crores in the year 2010 and
outstanding as on 31.3.2013 was Rs.2 crores. Now the
company wants to take new term loan of Rs.8 crores and
cash credit limit of Rs.5 crores in February 2014. Can it
do so by passing Board resolution?
53. Paid-up capital and free reserve of ABC
Ltd is Rs.10 crores. It has invested Rs.10
crores in Reliance Mutual Fund. Is
there any contravention?
Q.14: