According to section 186 of Companies Act, the section is not applicable on loan granted by Infrastructure company.
However if a company engaged in infrastructure projects is to obtain loan from its group companies would it still not be applicable?
In response to your query,
Non-applicability of Section 186 With respect to loans, guarantee or security
- A banking company in the ordinary course of its business
- An insurance company in the ordinary course of its business
- A housing finance company in the ordinary course of its business
- A company engaged in the business of financing of companies or of providing infrastructural facilities.
Hence the answer is no the company you mention cannot get a loan from even its own group companies. But here are some other ways to finance infrastructural companies which you can check-
- Public Finance.
- Supra National Financial Institutions.
- Private Finance.
- Public-Private Partnership.
Regards,
Aryan Raj
