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The Tax Publishers Acceptance of Deposits and Filing of Return Pragya Lalwani This write up provides for the basic requirements to be taken care of by the companies at the time of accepting deposits in the light of rules 3 and 16 of the Companies (Acceptance of Deposits) Rules, 2014 as amended from time to time. 1. Introduction Apart from issuing equities and debentures, companies can also raise funds by accepting deposits to fulfil their requirements. The Companies Act, 2013 has introduced various terms and conditions for acceptance of deposits by companies viz., threshold limits of accepting deposits for different type of a company, filing of return to Registrar, obtaining credit rating, etc. so as to protect the interest of depositors. Such terms and conditions have been provided under section 73(2) of the Companies Act, 2013 and rules 3 and 16 of the Companies (Acceptance of Deposits) Rules, 2014 as amended from time to time, being discussed hereunder. 2. Acceptance of deposits by companies Every company except those specified under proviso to section 73(1) is prohibited to invite, accept or renew deposits from the public. However, companies can accept deposits from members pursuant to section 73(2), subject to passing of a resolution in general meeting and certain conditions as follows: (a) Issuance of a circular to its members including therein a statement showing financial position of the company, credit rating obtained, total number of depositors and the amount due towards deposits accepted earlier. SUBSCRIBE FOR FULL CONTENT

The Tax Publishers

Acceptance of Deposits and Filing of Return

Pragya Lalwani

This write up provides for the basic requirements to be taken care of by the companies at the time of accepting deposits in the light of rules 3 and 16 of the Companies (Acceptance of Deposits) Rules, 2014 as amended from time to time.

1. Introduction

Apart from issuing equities and debentures, companies can also raise funds by accepting deposits to fulfil their requirements. The Companies Act, 2013 has introduced various terms and conditions for acceptance of deposits by companies viz., threshold limits of accepting deposits for different type of a company, filing of return to Registrar, obtaining credit rating, etc. so as to protect the interest of depositors. Such terms and conditions have been provided under section 73(2) of the Companies Act, 2013 and rules 3 and 16 of the Companies (Acceptance of Deposits) Rules, 2014 as amended from time to time, being discussed hereunder.

2. Acceptance of deposits by companies

Every company except those specified under proviso to section 73(1) is prohibited to invite, accept or renew deposits from the public. However, companies can accept deposits from members pursuant to section 73(2), subject to passing of a resolution in general meeting and certain conditions as follows:

(a) Issuance of a circular to its members including therein a statement showing financial position of the company, credit rating obtained, total number of depositors and the amount due towards deposits accepted earlier.