law: Companies Act, 2013 
  67.
  
    Restrictions
  
  on purchase by company or giving of loans by it for purchase of its shares.
  1.      No company limited by
  
  shares or by guarantee and having a share capital shall have power to buy its
  
  own shares unless the consequent reduction of share capital is effected under
  
  the provisions of this Act.
  2.      No public company
  
  shall give, whether directly or indirectly and whether by means of a loan,
  
  guarantee, the provision of security or otherwise, any financial assistance for
  
  the purpose of, or in connection with, a purchase or subscription made or to be
  
  made, by any person of or for any shares in the company or in its holding
  
  company.
  3.      Nothing in
  
  sub-section (2 ) shall apply toŚ
  a.     
  
    the
  
  lending of money by a banking company in the ordinary course of its business;
  b.    
  
    the
  
  provision by a company of money in accordance with any scheme approved by
  
  company through special resolution and in accordance with such requirements as
  
  may be prescribed, for the purchase of, or subscription for, fully paid up
  
  shares in the company or its holding company, if the purchase of, or the
  
  subscription for, the shares held by trustees for the benefit of the employees
  
  or such shares held by the employee of the company;
  c.     
  
    the
  
  giving of loans by a company to persons in the employment of the company other than
  
  its directors or key managerial personnel, for an amount not exceeding their
  
  salary or wages for a period of six months with a view to enabling them to
  
  
  
  purchase or subscribe for fully paid-up shares in the company or its holding
  
  company to be held by them by way of beneficial ownership:
  Provided
  
  that disclosures in respect of voting rights not exercised directly by the
  
  employees in respect of shares to which the scheme relates shall be made in the
  
  Board's report in such manner as may be prescribed.
  1.     
  2.     
  3.     
  4.      Nothing in this
  
  section shall affect the right of a company to redeem any preference shares
  
  issued by it under this Act or under any previous company law.
  5.      If a company
  
  contravenes the provisions of this section, it shall be punishable with fine
  
  which shall not be less than one lakh rupees but which may extend to
  
  twenty-five lakh rupees and every officer of the company who is in default
  
  shall be punishable with imprisonment for a term which may extend to three
  
  years and with fine which shall not be less than one lakh rupees but which may
  
  extend to twenty-five lakh rupees.