Interest Free Loan by a Holding Company to a WOS

[Maharshi Ganatra]

Dear All,

Can a Holding Company give an Interest -free loan to a Wholly-Owned Subsidiary if it is within the limits mentioned in Section 186?

If, yes what are the Compliances required to be done.

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Regards,

Maharshi Ganatra

Mumbai

Mob:- +91-7208193776

          +91-9930692152

[sitansh magia]

The exemption is taken away in the companies act, 2013. However, if there holding company is engaged in infrastructure development as specified in schedule V, it is exempted from giving interest free loan and guarantee to ANY company.....

[sitansh magia]

[sitansh magia]

[Maharshi Ganatra]

Thank You for your answer sir.

There is a conflict with Section 186 and Section 185, so which shall prevail  is the question as Section 185 permits Holding Company to grant loan to a WOS irrespective of Rate of Interest.

As you say the exemption is removed, then will passing of Special Resolution be sufficient Compliance or there are any other Compliances required.

On Sat, Jul 19, 2014 at 1:00 PM, sitansh magia <sitans...@gmail.com> wrote:

The exemption is taken away in the companies act, 2013. However, if there holding company is engaged in infrastructure development as specified in schedule V, it is exempted from giving interest free loan and guarantee to ANY company.....

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