Pledge of shares for business purposes in favour NBFCs

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....(DIR Series) Circular No. 57 dated May 2, 2011, in terms of which shares of an Indian company held by the non-resident investor can be pledged in favour of a bank in India to secure the credit facilities being extended to the resident investee company for bonafide business purposes subject to the conditions stipulated therein. 2. With a view to further rationalising the process and reducing the t....

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....013 as amended from time to time; * (i) The AD may obtain a board resolution 'ex ante', passed by the Board of Directors of the investee company, that the loan proceeds received consequent to pledge of shares will be utilised by the investee company for the declared purpose; (ii) The AD may also obtain a certificate 'ex post', from the statutory auditor of investee company, that the loan proceed....