XYZ Ltd., took a loan of ₹ 50 lakh from a bank for its growth and expansion plans . The company was unable to repay the loan amount because of heavy losses incurred in the business on a continuous basis .
The management of the company asked its shareholders to contribute towards repayment of the loan .
But the shareholders refused as they had already paid the full amount due on their shares . The bank filled a case against XYZ Ltd. in the court . The court held that the shareholders of the company were not liable to repay the loan as they had not unpaid amount on shares .
(a) Is the court's decision justified ? Give reason in support of your answer .
(b) Which characteristic of the company form of organisation protected the shareholders ? Explain .

ABC Ltd. Took a loan of Rs. 50 lac from a Bank its growth and expansion plans. The company was unable to repay because of heavy losses. The company asked its shareholders to come forward and contribute towards repayment of loan. The shareholders to come forward and contribute towards repayment of loan. The shareholders refused as they had already paid the full amount due on their shares. Bank filed a case against ABC Ltd. The court said that company could not call shareholders to repay loan as they have no unpaid amount of shares. It was the duty of ABC Ltd. to use company's assets to repay loan. (a) In the above case what kind of liability is enjoyed by the shareholders of ABC Ltd.? (b) Which feature of company protected shareholders, i.e., owner of business not to pay?

The asset or assets that a borrower pledges in order to guarantee repayment of a loan is called as

A person took a loan of R. 25220 from a bank under this condition that the would repay the loan b three equal instalments. If the rate of compound interest of the bank be 5% per annum, then find the amount of money in each instalment.

Gopal Sharma and Balram Sharma are two brothers , who inherited some ancestral property . They decided to form a Hindu Undivided Family (HUF) business consisting of four male members . Gopal Sharma is the elder brother . So he became 'Karta' . The business took a loan of ₹ 20 lakh from Punjab National Bank having maturity period of 5 years . Due to poor financial position of the business , they were unable to repay the loan . They sold the ancestral property for ₹ 10 lakh and paid the same to Punjab National Bank . They could not pay the balance amount of loan with interest . The bank filed a case for recovery of the balance amount . Gopal Sharma pleaded the court that the loan was taken for the purpose of business , therefore , all the members of the business were liable to repay the loan . The court held that all other members were responsible only to the extent of their share in business , and the business property was already sold . However , Gopal Sharma , being 'Karta' would have to repay the balance amount even by selling his personal properties . Gopal Sharma had to sell some of his personal assets to repay the balance amount to bank loan . (a) Is the court's decision justified ? Give reasons in support of your answer . (b) State any three other feartures of HUF businesses .