Deep Sea Trawlers Limited, a public listed company has given the following information for the FY ended 31st March, 2024 : Particulars ₹ in crores Paid-up Equity share capital 12 Preference share capital 4 General Reserv

According to the provisions of Section 180(1)(c) of the Companies Act, 2013, pertaining to restrictions on powers of the Board of Directors (BOD), the BOD shall exercise only with the consent of the company by a special resolution, inter alia, the power to borrow money, where the money to be borrowed, together with the money already borrowed by the company will exceed aggregate of its paid-up share capital, free reserves and security premium, apart from temporary loans obtained from the company's bankers in the ordinary course of business. In the given scenario the aggregate of paid up share capital ₹ 16 crore (12+4), GR i.e. FR ₹ 40 crore and Securities Premium A/c ₹ 24 crore that comes to ₹ 80 crore. The outstanding term loans of the company, excluding temporary short-term loan, is ₹ 65 crores. Hence, the company can borrow further loan up to ₹ 15 crore under the exclusive authority of the Board of directors. However, the proposed further loan is ₹ 25 crore which is beyond the authority of the Board and hence the approval of the shareholders in a general meeting by way of a special resolution would be required. Accordingly, in this case the proposed further loan can be obtained under the authority of a special resolution to be passed in the general meeting of the shareholders.