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    Does "Body Corporate" includes Partnership Firm under Section 186 Inbo

    Posted By : damini / Published on : 05-Dec-2019 12:04 PM / View : 1903 / Comment : 1

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    Dear Respected Members,

    A Company invested some amount in Partnership Firm.

    I have two query in that regard.
    1. Will that invested amount come within the calculation of Section 186?

    2. Is there any violation under the Co. Act to invest amount in Partnership Firm?
    Read more on : under section inbo firm partnership body corporate includes does

    • No, a Partnership Firm is not considered a "Body Corporate" under Section 186 of the Companies Act, 2013.

      As per the definition provided in Section 2(11) of the Companies Act, 2013, a "Body Corporate" means a company as defined in Section 2(20) of the Act, a limited liability partnership, a registered society, or any other entity incorporated under any other law for the time being in force.

      Therefore, a Partnership Firm, which is not incorporated under any law, does not fall under the definition of a "Body Corporate" and hence is not covered under Section 186 of the Companies Act, 2013.

      However, it is important to note that a private company making investments in a Partnership Firm or providing loans, guarantees or securities to a Partnership Firm would still need to comply with the applicable provisions of the Companies Act, 2013 and the rules made thereunder. For example, the private company may need to comply with the provisions relating to related party transactions as per Section 188 of the Companies Act, 2013.

      19-04-2023 / 10:46:58 AM
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