Applicability of Section 295(1)(e) of Companies Act 1956
Querist :
Anonymous
(Querist) 26 March 2010
This query is : Resolved
Dear Sir/ma'am
The Facts are as follows:
Company A (Indian Company) is subsidiary of B Company (Foreign Company).
A co. has many Companies as group Companies.
B Co has appointed a delegate in India to supervise A Company and A Company's group Companies ( Entire Indian operations). That delegate is appointed as the Chairman for A Company and its group Companies. All the Companies are Public companies.
Query:
1) A Company wants to lend money to its group companies. Will the Section 295(1)(e) of Companies Act 1956 be applicable in this situation?? please help me with case laws.
Thank You.
Regards
Heaven 2011
(Expert) 29 March 2010
Merely because Company A is subsidiary of B company (foreign company)it is not that that section 295 wilp not come into play. If the group have the common dirctors or any director(s) in accordance with whose directions the other company is accustomed to act the the provision will definitely be applicable. For case study you may refer Ramya's Companies Act.
Rgds,
Querist :
Anonymous
(Querist) 29 March 2010
Thanks a lot Ashish
