The lender providing the loan outside the rights of the company does not have the right to sue the company, but the lender can get the following remedies
(1) Right of injunction – If the amount given as loan to the company has not yet been spent by the company, then the lender can get an injunction to stop the expenditure of this amount.
(2) Taking the place of creditors – If the company has paid the amount of debt taken out of rights from any lender to its creditors, then this creditor can take the place of that creditor i.e. get all the rights of that creditor. Will take
(3) Receipt of property on recognition – The lender has the right if given by him. If any property taken out of the loan taken is recognizable, he can take it back from the company.
(4) Proceedings against directors – A lender giving a loan out of rights may lay claim to those operators who have taken a loan outside the limits of rights.
(5) Right to get compensation- If it is not clear from the memorandum and Articles of Association of the company whether the directors have the right to take loan or not, then the lender can claim compensation from the operators.