Wrong credit of loan

[DR.MARIAPPAN GOVINDARAJAN]

The directors of one Nidhi company approached their bank for getting personal loan mortgaging their own properties. In the same company is also maintaining its account. The bank wrongly credited the entire loan amount in the accounts of the company and distributed the said amount to the directors. The said fact came to be known when the company accounts is audited by the auditor. How it could be rectified.

AI Summary

Nidhi Company Directors Must Repay Miscredited Loan; Reapply for Personal Loans Post Bank Error Acknowledgment The directors of a Nidhi company sought personal loans using their properties as collateral. The bank mistakenly credited the loan amount to the company's account instead of the directors', and the funds were distributed to the directors. This error was discovered during an audit. To rectify this, the company should repay the loan with interest and close the loan account, after which the directors should reapply for the loan. Additionally, obtaining a confirmation letter from the bank acknowledging the error can help address any discrepancies in the company's financial records.