27/08/2022
IMP INTERPRETATION OF C A 2013: *Part 1*
A. While *interpreting/applying any section/rule of CA 2013*, *LLP is not a Body Corporate*.
B. *P&L Cr Balance* itself is *not a reserve* as nothing is appropriated to Reserves. It should be *transferred to General Reserve A/c* to consider as a “Reserve”.
C. For Sec 186, *every proposal* for *Investment, providing Securities, give Guarantee or Loan* in excess of prescribed limits shall be specifically approved at the *GM*.
D. Company *cannot give Interest free loans* as min interest rate should be equal to Govt Sec.
E. HUF is not a living person. Hence, *HUF is not a relative of Director* as per the CA 2013.
F. The terms *“Deposits” & “Loan” may not be mutually exclusive*, but nonetheless, in each case, *intention of parties & circumstances* must be considered.
G. In case *FY ending on 31st Dec,* data for *Deposit Return* i.e. Form DPT - 3 is to be *filed as on 31st March.*
H. In case of *default in repayment of Deposits,* Company *could not proceed* with *Dividend*, *providing loans/securities/guarantees or make an acquisition or buyback of shares* as well as all Directors become *Disqualified to act as a director.*
I. *Non-filing of charge* does not mean that the Debt cannot be recovered.
J. U/s 185, *Loan to Director* or its relative of Subsidiary Company or Relative of Director’s Partner in Firm is allowed.
K. U/s 184, *Directors’ interest disclosure* required in the First BM only when his *intention is to control or to invest or do business or having interest* with those Companies. However, *no disclosure required if it is for trading purpose.*
Regards,
*CS Kuldip*
M. 9898823040
