Provision of Sec 295(1):
Sec 295 shall not apply to-
(a) any loan made, guarantee given or security provided-
(i) by a private company unless it is a subsidiary of a public company, or
(ii) by a banking company;
(b) any loan made by a holding company to its subsidiary company.
(c) any guarantee given or security provided by a holding company in respect of any loan made to its subsidiary company.
Putting in a simple way:-
What are the Lending companies :-
1. Public Company
2. Private company, which is a subsidiary of Public company.
What are NOT the lending companies:-
1. Private company
2. Banking company
3. Holding ------> Subsidiary [ Loan or Guarantee ]
Coming to NBFC:
There are 3 types of NBFC's :-
(i) NBFC's accepting public deposit (NBFCs-D)
(ii) NBFC's not accepting/holding public deposit (NBFCs-ND).
(iii) Residuary Non-Banking Companies(RNBCs)
Hence, check the Memorandum whether the NBFC is a Public company or not.
If so, The provisions of Sec 295 applies.
Please correct me if i am wrong.