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    Query Under section 185/186

    Posted By : Kamal / Published on : 21-Jun-2021 05:55 PM / View : 277 / Comment : 1

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    Dear All,

    I have one query if a company has passed Special Resolution under section 185/186 of Companies Act 2013. with a specific limit. Query is till what date the Resolution is Valid ? up to the Limit is not crossed or till 1year from the Resolution passed ?
    Read more on : section under query

    • As per the provisions of the Companies Act, 2013, the validity of a Special Resolution passed by a company under Section 185/186 will depend on the specific terms and conditions mentioned in the resolution itself.

      If the Special Resolution specifies a specific limit for the loan, guarantee, or security to be provided, then the validity of the resolution will be up to the limit mentioned in the resolution. Once the limit specified in the resolution is reached, a new resolution will be required to be passed by the company if it wants to provide further loans, guarantees, or securities.

      However, if the Special Resolution does not mention any specific limit, then the validity of the resolution will be for a period of one year from the date of passing the resolution. This means that the company can provide loans, guarantees, or securities up to the limit specified in the resolution or for a period of one year from the date of passing the resolution, whichever is earlier.

      It is important to note that even if a company has passed a Special Resolution, it must still comply with all the other provisions of the Companies Act, 2013 and the rules made thereunder relating to the transaction. The transaction must also be in the best interest of the company and its shareholders.

      19-04-2023 / 10:48:30 AM
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