What is Section 185?
Section 185 of the Companies Act, 2013 which has been notified on 12th September 2013 corresponds to section 295 of the Companies Act, 1956 which deals in loan to directors. This section is more restrictive than that of old Companies Act, 1956.
Section 185 prohibits any company from giving loans, guarantees and securities in favor of its directors or to any other person in whom the director is interested in.
Bare – Act:
Save as otherwise provided in this Act, no company shall, directly or indirectly, advance any loan, including any loan represented by a book debt, to any of its directors or to any other person in whom the director is interested or give any guarantee or provide any security in connection with any loan taken by him or such other person:
Solutions of Sec 185:
Say , A Pvt Ltd want to grant loan to B Pvt Ltd:
i) Find out “total number of family members & other persons , who can be appointed as director of A Pvt Ltd”, say, total 10 persons (who can be appointed as director of A Pvt Ltd)
ii) Find out who are shareholders (say 6 persons) & directors (say 2 persons) of B Pvt Ltd i.e. total 8 persons
iii) Appoint other 2 persons as director of A Pvt Ltd.
2) IT: CBDT extends the last date of filing Income Tax return in Gujarat only. Earlier the last date was 31st August, now 7 September 2015.
3)IT: Sum received for permitting installation of Telecom Tower on terrace is taxable as income from house property- Niagara Hotels & Builders (P.) Ltd. 60 taxmann.com 83 (Delhi).
Solutions of Sec 185 of Companies Act
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