Company Law
What are the procedures to sign the loan documents in a bank or financial institutions by a PVT LTD company? Minimum how many directors are necessary to sign? Is metalic seal of the company is compulsory? If so what is procedure to affix the common seal of the company and in the presence of who all it can be?
Need to know about the law as to mortgage of company property as security to the bank loan and it's procedures.. and also as to affixing of common seal.
By  RAMESH N  |  27 Oct 2016  |  Upvotes: 0  | 

1 Answer(s)

Tanushree Sharma
Advocate

The procedure depends on the following agendas :

  • articles of the company
  • requisition by the bank
  • board resolution of the company

If the articles do not mention any requisition on taking a loan from a bank or financial minimum and the the bank or financial institution also dosen't put any kind of requisition, the board resolution must determine the procedure of takng such a loan, minimum two directors are required to sign the document which can be altered in the board resolution. Mettallic seal is compulsory in certain documents in presence of two directors and of secretary or such other person as the board may appoint for the purpose; and those two directors and secretary or other person aforesaid shall sign every instrument to which the seal of the company is so affixed in their presence. And especially on loan documents it is needed but the companies act does not provide any provisions which says that the deal has to be metallic, it can be rubber as well.

 

Upvotes: 0  |  Downvotes: 0  |  Comments  | 
Login to comment