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A holding company given loan to its wholly owned subsidiary under old Act, but as per the provisions of Companies Act, 2013, holding company can give loan to its wholly owned subsidiary and that loan shall be utilized only for principal business activities, unfortunately the loan is not utilized for principal activities and subsidiary is short funds to repay back the loan amount, suggest what option do company have in present?

Section 185- Loan to directors, etc.

Posted By: Akansha 10 year(s) ago

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Hemang Mehta

You may connvert the laon into share application money and subscribe further share capital of your WOS as per the provisions of the new Act. Alternatively, you may opt for amalgamation of WOS into Holding Company.

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