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Hi everyone, Please Clarify -"A"Private limited has taken loan from "B"Private limited which is not related to"A"Private limited. And Now "A"Private limited want to invest in the equity shares of "C" Private company which is related to "A"Private limited i.e. one of the director is common in both private companies -"A" &"C". Can "A"Private limited invest in "C"Private limited? If yes, than upto what limit? Is there any upper limit for authorization by passing SR?

Section 186- Loan and investment by company.

Posted By: Dhavneesh gupta 9 year(s) ago

This question has been closed if you want to answer,you have to re-open.


    DHAVNEESH GUPTA

But Section 185 deals with loan or security for loan taken by director or director interest. It doesn't deal with investment. Section 186 deals with Investment by company. I want to know whether "A" can invest in "C" which is related private company. And If yes, than upto what limit with Board Resolution and upto what limit with Special resolution?.......Pl. clarify?????

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    Akansha

A cannot invest in B (another private company) as they have one common director and it is strictly prohibited under explanation (c) to sec 185 (1).

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