NBFCs – RBI's Master Circular dated 1-7-2011 on Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998

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NOTIFICATION AS AMENDED UP TO JUNE 30, 2011 – “NON-BANKING FINANCIAL COMPANIES ACCEPTANCE OF PUBLIC DEPOSITS (RESERVE BANK) DIRECTIONS, 1998”

CIRCULAR NO. DNBS (PD) CC NO. 223/03.02.001/2011-12, DATED 1-7-2011

As you are aware, in order to have all current instructions on the subject at one place, the Reserve Bank of India issues updated Circulars/notifications. The instructions contained in the Notification No.DFC.118/DG (SPT)-98, dated January 31, 1998 updated as on June 30, 2011 are reproduced below (Annexure). The updated Notification has also been placed on the RBI web-site (http://www.rbi.org.in).

Annexure

NBFCs : “Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998”

Notification No.DFC.118/DG (SPT)-98, dated 31-1-1998 updated as on 30-6-2011

The Reserve Bank of India having considered it necessary in the public interest and being satisfied that for the purpose of enabling the Bank to regulate the credit system to the advantage of the country, it is necessary to give the directions set out below, hereby, in exercise of the powers conferred by sections 45J, 45K, 45L and 45MA of the Reserve Bank of India Act, 1934 (2 of 1934) and of all the powers enabling it in this behalf, and in supersession of the earlier directions contained in Notification No.DFC.114/DG(SPT)-98, dated January 2, 1998 gives to every non-banking financial company the directions hereinafter specified.

PART I – PRELIMINARY

Short title and commencement of the directions

1. These directions shall be known as the “Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998”. They shall come into force with effect from January 31, 1998 and any reference in these directions to the date of commencement thereof shall be deemed to be a reference to that date.

Definitions

2. (1) For the purpose of these directions, unless the context otherwise requires, –

(ia) “Asset Finance Company” means any company which is a financial institution carrying on as its principal business the financing of physical assets supporting productive/economic activity, such as automobiles, tractors, lathe machines, generator sets, earth moving and material handling equipments, moving on own power and general purpose industrial machines.¹

(i) “depositor” means any person who has made a deposit with a company; or a heir, legal representative, administrator or assignee of the depositor;

(ii) Deleted ²

(iii) “free reserves” means the aggregate of the balance in the share premium account, capital and debenture redemption reserves and any other reserve shown or published in the balance sheet of a company and created through an allocation of profits not being a reserve created for repayment of any future liability or for depreciation in assets or for bad debts or a reserve created by revaluation of the assets of the company;

(iv) Deleted ³

(v) “insurance company” means any company registered under section 3 of the Insurance Act, 1938 (4 of 1938);

(vi) “investment company” means any company which is a financial institution carrying on as its principal business the acquisition of securities;

(vii) “lending public financial institution” means –

(a) a public financial institution specified in or under section 4A of the Companies Act, 1956 (1 of 1956); or

(b) a State Financial, Industrial or Investment Corporation; or

(d) the General Insurance Corporation of India established in pursuance of the provisions of section 9 of the General Insurance Business (Nationalisation) Act, 1972 (57 of 1972); or

(e) any other Institution which the Reserve Bank of India may, by notification, specify in this behalf;

(viii)”loan company” means any company which is a financial institution carrying on as its principal business the providing of finance whether by making loans or advances or otherwise for any activity other than its own but does not include an Asset Finance Company⁴.

(ix) “mutual benefit financial company” means any company which is a financial institution notified by the Central Government under section 620A of the Companies Act, 1956 (1 of 1956);

⁵[(ixa) “mutual benefit company” means a company not notified under section 620A of the Companies Act, 1956 (1 of 1956) and carrying on the business of a non-banking financial institution, –

(a) on 9th January 1997; and

(b) having the aggregate of net owned funds and preferential share capital of not less than ten lakhs of rupees; and

(d) is complying with the requirements contained in the relevant provisions of the Directions issued under Section 637A of the Companies Act, 1956 to Nidhi Companies by the Central Government];

(x) ‘net owned fund’ means net owned fund as defined under section 45-IA of the Reserve Bank of India Act, 1934 (2 of 1934) including the paid up preference shares which are compulsorily convertible into equity;

(xi) “non-banking financial company” means only the non-banking institution which is a loan company or an investment company or an asset finance company⁶ or a mutual benefit financial company;

(xii) ‘public deposit’, means a deposit as defined under section 45-I(bb) of the Reserve Bank of India Act, 1934 (2 of 1934) excluding the following :

(a) any amount received from the Central Government or a State Government or any amount received from any other source and whose repayment is guaranteed by the Central Government or a State Government or any amount received from a local authority or a foreign Government or any other foreign citizen, authority or person;

(b) any amount received from the Industrial Development Bank of India established under the Industrial Development Bank of India Act, 1964 (18 of 1964), or the Life Insurance Corporation of India established under the Life Insurance Corporation Act, 1956 (31 of 1956), or the General Insurance Corporation of India and its subsidiaries established in pursuance of the provisions of section 9 of the General Insurance Business (Nationalisation) Act, 1972 (57 of 1972), or the Small Industries Development Bank of India established under the Small Industries Development Bank of India Act, 1989 (39 of 1989), or the Unit Trust of India established under the Unit Trust of India Act, 1963 (52 of 1963), or National Bank for Agriculture and Rural Development established under the National Bank for Agriculture and Rural Development Act, 1982, or an Electricity Board constituted under the Electricity (Supply) Act, 1948, or the Tamil Nadu Industrial Investment Corporation Ltd., or the National Industrial Development Corporation of India Ltd., or the Rehabilitation Industries Corporation of India Ltd., or the Industrial Credit & Investment Corporation of India Ltd., or the Industrial Finance Corporation of India Ltd., or the Industrial Investment Bank of India Ltd., or the State Trading Corporation of India Ltd., or the Rural Electrification Corporation Ltd., or the Minerals and Metals Trading Corporation of India Ltd., or the Agricultural Finance Corporation Ltd., or the State Industrial and Investment Corporation of Maharashtra Ltd., or the Gujarat Industrial Investment Corporation Ltd., or Asian Development Bank or International Finance Corporation or any other institution that may be specified by the Reserve Bank of India in this behalf ;

(d) any amount received by way of subscriptions to any shares, stock, bonds or debentures pending the allotment of the said shares, stock, bonds or debentures and any amount received by way of calls-in-advance on shares, in accordance with the Articles of Association of the company so long as such amount is not repayable to the members under the Articles of Association of the company;

(e) any amount received from a person who at the time of receipt of the amount was a director of the company or any amount received from its shareholders by a private company or by a private company which has become a public company under section 43A of the Companies Act, 1956 and continues to include in its Articles of Association provisions relating to the matters specified in clause (iii) of sub-section (1) of section 3 of the Companies Act, 1956 (1 of 1956):

Provided that the director or shareholder, as the case may be, from whom the money is received furnishes to the company at the time of giving the money, a declaration in writing to the effect that the amount is not being given out of funds acquired by him by borrowing or accepting from others;

⁷[provided further, that in the case of joint shareholders of a private company, monies received from or in the name of the joint shareholders except the first named shareholder shall not be eligible to be treated as the receipt of money from the shareholder of the company ;]

(f) any amount raised by the issue of bonds or debentures secured by the mortgage of any immovable property of the company; or by any other asset or with an option to convert them into shares in the company provided that in the case of such bonds or debentures secured by the mortgage of any immovable property or secured by other assets, the amount of such bonds or debentures shall not exceed the market value of such immovable property/other assets;

(g) any amount brought in by the promoters by way of unsecured loan in pursuance of stipulations of lending institutions subject to the fulfilment of the following conditions, namely:-

(i) the loan is brought in pursuance of the stipulation imposed by the lending public financial institution in fulfilment of the obligation of the promoters to contribute such finance,

(ii) the loan is provided by the promoters themselves and/or by their relatives, and not from their friends and business associates, and

(iii) the exemption under this sub-clause shall be available only till the loan of financial institution is repaid and not thereafter;

⁸[(h) any amount received from a Mutual Fund which is governed by the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996; ]

⁹[(i) any amount received as hybrid debt or subordinated debt the minimum maturity period of which is not less than sixty months;]

¹⁰[(j)any amount received from a relative of a director of an NBFC

Note : The deposit shall be accepted only on an application made by the depositor containing therein that as on the date of deposit, he is related to the specific director in the capacity of a relative as defined under Companies Act, 1956 (1 of 1956).]

¹¹[(k) any amount received by issuance of commercial paper, in accordance with the guidelines issued by the Bank, vide Circular No. IECD.3/08.15.01/2000-2001 dated October 10, 2000];

¹²(l) any amount received by a Systemically important non-deposit taking non-banking financial company by issuance of ‘perpetual debt instruments’ in accordance with Company Circular DNBS (PD) CC. No.131/03.05.002/2008-2009 dated October 29, 2008 as amended from time to time ;

“(m) any amount raised by the issue of infrastructure bonds by an Infrastructure Finance Company, as specified in the notification issued from time to time by the Central Government under section 80CCF of the Income Tax Act, 1961.”¹³

(xiii)”securities” means securities as defined in section 2(h) of the Securities Contracts (Regulation) Act, 1956 (42 of 1956);

(xiv) “stock broking company” means a company doing the business of a stock-broker or sub-broker holding a valid certificate of registration obtained under section 12 of the Securities and Exchange Board of India Act, 1992 (15 of 1992); and

xv) “stock exchange” means a company recognised as a stock exchange under section 4 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956).

(2) Words or expressions used but not defined herein and defined in the Reserve Bank of India Act, 1934 (2 of 1934) or in the Companies Act, 1956 (Act No.1 of 1956) ¹⁴ [or Non-Banking Financial Companies Prudential Norms (Reserve Bank) Directions, 1998 or the Residuary Non-Banking Companies (Reserve Bank) Directions, 1987] shall have the same meaning as assigned to them in those Acts.

(3) (i) If any question arises as to whether a company is a financial institution or not, such question shall be decided by the Reserve Bank of India in consultation with the Central Government and such decision shall be final and be binding on all the parties concerned.

(ii) If any question arises as to whether a company which is a financial institution is a loan company or an investment company or an asset finance company¹⁵ such question shall be decided by the Reserve Bank of India, having regard to the principal business of the company and other relevant factors and such decision shall be final and be binding on all the parties concerned.

NOTE : Deleted ¹⁶

PART II – ACCEPTANCE OF PUBLIC DEPOSITS

Restrictions on acceptance of public deposits by mutual benefit financial companies

3. (1) [deleted ]¹⁷

(2) [The provisions contained in these directions shall not apply to a Mutual Benefit Financial Company or a Mutual Benefit Company;

Provided that the application of Mutual Benefit Company is not rejected by Government of India under the provisions of the Companies Act, 1956 (Act 1 of 1956).]¹⁸

Restrictions on acceptance of public deposits by non-banking financial companies

4. Minimum Credit Rating

(1) On and from January 31, 1998, –

(i) no non-banking financial company having Net Owned Fund (hereinafter referred to as ‘NOF’) of twenty five lakh of rupees and above shall accept public deposit unless it has obtained minimum investment grade or other specified credit rating for fixed deposits from any one of the approved credit rating agencies at least once a year and a copy of the rating is sent to the Reserve Bank of India along with return on prudential norms :

¹⁹[ Provided that this clause shall not apply to an Asset Finance Company referred to in clause (a) of sub-paragraph (4) hereunder;].

(ii) in the event of upgrading or downgrading of credit rating of any non-banking financial company to any level from the level previously held by the non-banking financial company, it shall within fifteen working days of its being so rated inform, in writing, of such upgrading/downgrading to the Reserve Bank of India.

Approved Credit Rating Agencies and Minimum Investment Grade Credit Rating

The names of approved credit rating agencies and the minimum credit rating shall be as follows:-

Name of the agency	Minimum investment Grade Rating
(a) The Credit Rating Information Services of India Ltd. (CRISIL)	FA- (FA Minus)
(b) ICRA Ltd.	MA- (MA Minus)
(c) Credit Analysis & Research Ltd. (CARE)	CARE BBB(FD)
(d) ²¹[Fitch Ratings India Private Ltd.]	²²[tA-(ind)(FD) ]

Prohibition from accepting demand deposit

(2) On and from January 31, 1998, no non-banking financial company shall accept or renew any public deposit whether accepted before or after January 31, 1998, which is repayable on demand.

Period of Public Deposit

(3) On and from January 31, 1998, no non-banking financial company shall accept or renew any public deposit whether accepted before or after January 31, 1998 unless such deposit is repayable after a period of twelve months but not later than sixty months from the date of acceptance or renewal thereof.

(4) Ceiling on quantum of deposit

Asset Finance Company (AFC)

Loan Company (LC) and Investment Company (IC) –

Acceptance of public deposit

No asset finance company ²⁴or loan company or investment company shall, accept or renew public deposit except as provided hereunder -*

AFC²⁵

(a) An asset finance company²⁶ –

(i) having NOF of twenty five lakh of rupees or more; and

(ii) complying with all the prudential norms with capital adequacy ratio of not less than fifteen per cent as per last audited balance-sheet,

may, accept or renew public deposit, together with the amounts remaining outstanding in the books of the company as on the date of acceptance or renewal of such deposit, not exceeding one and one-half times of its NOF or public deposit up to ten crore of rupees, whichever is lower.

(b) An asset finance company,²⁷–

(i) having NOF of twenty five lakh of rupees or more;

(ii) complying with all the prudential norms; and

(iii) having minimum investment grade credit rating,

LC/IC

(i) having NOF of twenty five lakh of rupees or more;

(ii) having minimum investment grade credit rating; and

(iii) complying with all the prudential norms with capital adequacy ratio of not less than fifteen per cent as per last audited balance-sheet,

Provided that a loan company or an investment company which is complying with all the above conditions and having, as on the date of its coming into force of these directions, AAA (triple A) grade credit rating but not having capital adequacy ratio of fifteen per cent may, so long it continues to maintain the same position of its credit rating, accept or renew public deposit only up to the extent of not exceeding the amount outstanding as at the close of business on December 18, 1998 or one and one-half time of its NOF, whichever is more, and shall bring down its public deposit to the level as specified in paragraph 4(6) of the directions and also attain the capital adequacy ratio of fifteen per cent before March 31, 2000.

(d) A loan company or an investment company which complies with all the prudential norms and having, as on the date of coming into force of these directions –

(i) NOF of twenty five lakh of rupees or more; and

(ii) AA (double A) grade credit rating; but not having capital adequacy ratio of fifteen per cent or above as per last audited balance-sheet,

may, so long it continues to maintain the same position of its credit rating, accept or renew the public deposit together with the amounts outstanding in the books of the company on the date of acceptance or renewal of such deposit, not exceeding an amount equivalent to its NOF until it attains the capital adequacy ratio of fifteen percent but not later than March 31, 2000 (as per audited balance-sheet) with other stipulations remaining the same.

(e) A loan company or an investment company which complies with all the prudential norms and having, as on the date of coming into force of these directions –

(i) NOF of twenty five lakh of rupees or more; and

(ii) A (single A) grade credit rating but not having capital adequacy ratio of fifteen per cent or above as per last audited balance-sheet,

may, so long it continues to maintain the same position of its credit rating, accept or renew the public deposit, together with the amounts outstanding in the books of the company as on the date of acceptance or renewal of such deposit not exceeding an amount equivalent to one-half of its NOF until it attains the capital adequacy ratio of fifteen per cent but not later than March 31, 2000

(as per audited balance-sheet) with other stipulations remaining the same.

Downgrading of Credit Rating

(5) In the event of downgrading of credit rating below the minimum specified investment grade as provided for in paragraph 4(4), a non-banking financial company shall regularise the excess deposit as provided hereunder :

AFC²⁸

(i) An asset finance company shall,²⁹–

(a) with immediate effect, stop accepting public deposit, if it is already holding public deposit to the extent permissible under sub-clause (b) of paragraph 4(4) above;

(b) report the position within fifteen working days to the Reserve Bank of India; and

(c) reduce, within three years from the date of such downgrading of credit rating, the amount of excess public deposit to nil or the appropriate extent permissible under sub-clause (a) of paragraph 4(4) above as the case may be, to which it is entitled to accept, by repayment as and when such deposit falls due or otherwise.

LC/IC

(ii) A loan company or an investment company shall,

(a) with immediate effect, stop accepting public deposit;

(b) report the position within fifteen working days to the Reserve Bank of India; and

(c) reduce, within three years from the date of such downgrading of credit rating, the amount of excess public deposit to nil by repayment as and when such deposit falls due or otherwise.

Regularisation of the public deposits accepted earlier and held in excess of the permissible extent

(6) Where an asset finance company³⁰ or a loan company or an investment company holds, at the close of business on December 18, 1998 public deposit in excess of the appropriate extent to which it is entitled to accept under the above provisions of these directions, it shall, –

(i) stop accepting public deposit; and

(ii) reduce, before December 31, 2001, the amount of excess public deposit to nil or the appropriate extent permissible under sub-clause (d) or (e) of paragraph 4(4) above as the case may be, by repayment as and when such deposit falls due or otherwise.

Note :

In the event of excess public deposits arising out of the regulatory ceiling or downgrading of credit rating, the NBFC may renew the maturing public deposit subject to the compliance of the repayment stipulations contained in sub-paragraphs (5) and (6) of paragraph 4 and other provisions of these directions. It is to clarify that no matured public deposit shall be renewed without the express and voluntary consent of the depositor.

Ceiling on the rate of interest

³¹[((7) On and from April 24, 2007, no non-banking financial company shall invite or accept or renew public deposit at a rate of interest exceeding twelve and half per cent per annum. Interest may be paid or compounded at rests which shall not be shorter than monthly rests.]

³²[(7A) On and from September 18, 2003, no non-banking financial company shall invite or accept or renew repatriable deposits from Non-Resident Indians in terms of Notification No. FEMA.5/2000-RB dated May 3, 2000 under Non-Resident (External) Account Scheme at a rate exceeding the rate specified by the Reserve Bank of India for such deposits with scheduled commercial banks.

Explanation

The period of above deposits shall be not less than one year and not more than three years.]

Payment of brokerage

(8) On and from January 31, 1998 no non-banking financial company shall pay to any broker on public deposit collected by or through him, –

(i) brokerage, commission, incentive or any other benefit by whatever name called, in excess of two per cent of the deposit so collected; and

(ii) expenses by way of reimbursement on the basis of relative vouchers/bills produced by him, in excess of 0.5 per cent of the deposit so collected.

³³[Intimation of maturity of deposits to depositors

(8A) It shall be the obligation of the non-banking financial company to intimate the details of maturity of the deposit to the depositor at least two months before the date of maturity of the deposit.” ]

Renewal of public deposit

(9) Where a non-banking financial company permits an existing depositor to renew the deposit before maturity for availing of the benefit of higher rate of interest, such company shall pay the depositor the increase in the rate of interest provided that, –

(i) the deposit is renewed in accordance with the other provisions of these directions and for a period longer than the remaining period of the original contract; and

(ii) the interest on the expired period of the deposit is reduced by one percentage point from the rate which the company would have ordinarily paid, had the deposit been accepted for the period for which such deposit had run; any interest paid earlier in excess of such reduced rate is recovered/adjusted.

Payment of interest on overdue public deposits

(10) A non-banking financial company may, at its discretion, allow interest on an overdue public deposit or a portion of the said overdue deposit from the date of maturity of the deposit subject to the conditions that:

(i) total amount of overdue deposit or the part thereof is renewed in accordance with other relevant provisions of these directions, from the date of its maturity till some future date; and

(ii) the interest allowed shall be at the appropriate rate operative on the date of maturity of such overdue deposit which shall be payable only on the amount of deposit so renewed :

Provided that where a non-banking financial company fails to repay the deposit along with interest on maturity on the claim made by the depositor, the non-banking financial company shall be liable to pay interest from the date of claim till the date of repayment at the rate as applicable to the deposit.

Joint deposit

(11) Where so desired, deposits may be accepted in joint names with or without any of the clauses, namely, “Either or Survivor”, “Number One or Survivor/s”, “Anyone or Survivor/s”.

Particulars to be specified in application form soliciting public deposits

(12) (i) On and from January 31, 1998, no non-banking financial company shall accept or renew any public deposit except on a written application from the depositor in the form to be supplied by the company, which form shall contain all the particulars specified in the Non-Banking Financial Companies and Miscellaneous Non-Banking Companies (Advertisement) Rules, 1977, made under section 58A of the Companies Act, 1956 (1 of 1956) and also contain the specific category of the depositor, i.e. whether the depositor is a shareholder or a director or a promoter of the company or a member of public.

(ii) The application form should also contain the following :-

(a) the credit rating assigned for its fixed deposit and the name of the credit rating agency which rated the company or a statement from the management if it is an asset finance company³⁴ that, the quantum of public deposit held by it is not exceeding one and one-half times of its NOF or not exceeding rupees ten crore whichever is less;

(b) in case of non-repayment of the deposit or part thereof as per the terms and conditions of such deposit, the depositor may approach the Eastern/Western/Northern/Southern (delete which are inapplicable) Bench of Company Law Board whose full address is given hereunder:

Give here the full address of the Bench of the Company Law Board under whose jurisdiction the registered office of the company is located;

(c) in case of any deficiency of the company in servicing its deposit, the depositor may approach the National Consumers Disputes Redressal Forum, the State Level Consumers Disputes Redressal Forum or the District Level Consumers Disputes Redressal Forum for relief;

(d) a statement that the financial position of the company as disclosed and the representations made in the application form are true and correct and that the company and its Board of Directors are responsible for the correctness and veracity thereof;

(e) the financial activities of the company are regulated by the Reserve Bank of India. It must, however, be distinctly understood that Reserve Bank of India does not undertake any responsibility for the financial soundness of the company or for the correctness of any of the statements or the representations made or opinions expressed by the company; and for repayment of deposit/discharge of liabilities by the company;

(f) at the end of application form but before the signature of the depositor, the following verification clause by the depositor should be appended:

“I have gone through the financials and other statements/particulars/representations furnished/made by the company and after careful consideration I am making the deposit with the company at my own risk and volition”.

³⁵[(g) the information relating to and the aggregate dues from the facilities, both fund and non-fund based, extended to, and the aggregate dues from companies in the same group or other entities or business ventures in which the directors and/or the non-banking financial company are holding substantial interest and the total amount of exposure to such entities.]

³⁶[(iii) Every non-banking financial company shall obtain proper introduction of the new depositors before opening their accounts and accepting the deposits and keep on its record the evidence which it has relied upon for the purpose of such introduction.]

Advertisement and statement in lieu of advertisement:

(13) (i) Every non-banking financial company soliciting public deposit shall comply with the provisions of the Non-Banking Financial Companies and Miscellaneous Non-Banking Companies (Advertisement) Rules, 1977 and shall also specify in every advertisement to be issued thereunder, the following :-

(a) the actual rate of return by way of interest, premium, bonus other advantage to the depositor;

(b) the mode of repayment of deposit;

(d) the interest payable on deposit;

(e) the rate of interest which will be payable to the depositor in case the depositor withdraws the deposit prematurely;

(f) the terms and conditions subject to which a deposit will be renewed;

(g) any other special features relating to the terms and conditions subject to which the deposit is accepted/renewed;

³⁷[(h) the information, relating to the aggregate dues (including the non-fund based facilities provided to) from companies in the same group or other entities or business ventures in which, the directors and/or the NBFC are holding substantial interest and the total amount of exposure to such entities; and]

³⁸[(i) that the deposits solicited by it are not insured. ]

³⁹[13(i) (A) Where an NBFC displays any advertisement in electronic media such as TV, even without soliciting deposits, it should incorporate a caption/band in such advertisements indicating the following:

As regards deposit taking activity of the company, the viewers may refer to the advertisement in the newspaper/information furnished in the application form for soliciting public deposits;

The company is having a valid Certificate of Registration dated ………….. issued by the Reserve Bank of India under section 45-IA of the Reserve Bank of India Act, 1934. However, the Reserve Bank of India does not accept any responsibility or guarantee about the present position as to the financial soundness of the company or for the correctness of any of the statements or representations made or opinions expressed by the company and for repayment of deposits/discharge of the liabilities by the company.]

(ii) Where a non-banking financial company intends to accept public deposit without inviting or allowing or causing any other person to invite such deposit, it shall, before accepting such deposit, deliver to the Reserve Bank of India for record, a statement in lieu of advertisement containing all the particulars required to be included in the advertisement pursuant to the Non-Banking Financial Companies and Miscellaneous Non-Banking Companies (Advertisement) Rules, 1977 as also the particulars stated in clause (i) hereinabove, duly signed in the manner provided in the aforesaid Rules.

(iii) A statement delivered under clause (ii) above shall be valid till the expiry of six months from the date of closure of the financial year in which it is so delivered or until the date on which the balance sheet is laid before the company in general meeting or where the annual general meeting for any year has not been held, the latest day on which that meeting should have been held in accordance with the provisions of the Companies Act, 1956 (1 of 1956), whichever is earlier, and a fresh statement shall be delivered after the expiry of the validity of the statement, in each succeeding financial year before accepting public deposit in that financial year.

General provisions regarding repayment of public deposit

⁴⁰[On and from October 5, 2004

Minimum lock- in period and Repayment in the event of death of the depositor

(14)(i) No non-banking financial company shall grant any loan against a public deposit or make premature repayment of a public deposit within a period of three months (lock-in period) from the date of its acceptance:

Provided that in the event of death of a depositor, a non-banking financial company may repay the public deposit prematurely, even within the lock – in period, to the surviving depositor/s in the case of joint holding with survivor clause, or to the nominee or the legal heir/s of the deceased depositor, on the request of the surviving depositor/s/nominee/legal heir, and only against submission of proof of death, to the satisfaction of the company.

Repayment of public deposits by a non-banking financial company not being a problem non-banking financial company

(ii) Subject to the provisions contained in sub-paragraph (i), a non-banking financial company not being a problem Non-Banking Financial Company may,

(a) with effect from October 5, 2004, permit premature repayment of a public deposit at its sole discretion:

Provided that in the case of a deposit accepted prior to the aforesaid date, such non-banking financial company may, if so permitted by the terms and conditions of acceptance of such deposit, repay it prematurely at the request of the depositor, after the expiry of three months from the date of deposit;

(b) grant a loan up to seventy-five per cent of the amount of public deposit to a depositor after the expiry of three months from the date of deposit at a rate of interest two percentage points above the interest rate payable on the deposit.

Repayment of public deposits by a problem non-banking financial company

(iii) Subject to the provisions contained in sub-paragraph (i), in order to enable a depositor to meet expenses of an emergent nature, a problem non-banking financial company may make premature repayment of, or grant a loan against, a public deposit in the following cases only, namely:

(a) repay a tiny deposit in entirety or repay any other public deposit up to an amount not exceeding Rs. 10,000; or

(b) grant a loan against a tiny deposit or up to an amount not exceeding Rs. 10,000 against any other deposit, at a rate of interest two percentage points above the interest rate payable on the deposit.

⁴¹[Clubbing of deposits by a problem non-banking financial company

(iv) All deposit accounts standing to the credit of sole/first named depositor in the same capacity shall be clubbed and treated as one deposit account for the purpose of premature repayment or grant of loan by a problem non-banking financial company;

Provided that this clause shall not apply to premature repayment in the event of death of depositor as provided in sub-paragraph (i).]

Rate of interest on premature repayment of public deposits

(v) Where a non-banking financial company, whether at its sole discretion or at the request of the depositor, as the case may be, repays a public deposit after three months from the date of its acceptance, but before its maturity (including premature repayment in the case of death of the depositor), it shall pay interest at the following rates:

After 3 months but before 6 months	No interest
After 6 months but before the date of maturity	The interest payable shall be 2 per cent lower than the interest rate applicable to a public deposit for the period for which the public deposit has run or if no rate has been specified for that period, then 3 per cent lower than the minimum rate at which public deposits are accepted by the non-banking financial company.

Explanation: For the purpose of this paragraph,

(a) ‘problem non-banking financial company’ means a non-banking financial company which –

(i) has refused or failed to meet within five working days any lawful demand for repayment of the matured public deposits ; or

(ii) intimates the CLB under section 58AA of the Companies Act, 1956, about its default to a small depositor in repayment of any public deposit or part thereof or any interest thereupon; or

(iii) approaches the Bank for withdrawal of the liquid asset securities to meet its deposit obligations; or

(iv) approaches the Bank for any relief or relaxation or exemption from the provisions of Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998 or from that of Prudential Norms for avoiding default in meeting public deposit or other obligations; or

(v) has been identified by the Bank to be a problem non-banking financial company either suo motu or based on the complaints from the depositors about non-repayment of public deposits or on complaints from the company’s lenders about non-payment of dues.

(b) ‘tiny deposit’ means the aggregate amount of public deposits not exceeding Rs. 10,000 standing in the name of the sole or the first named depositor in the same capacity in all the branches of the non-banking financial company.”]

Furnishing of receipt to depositor

(15)(i) Every non-banking financial company shall furnish to every depositor or his agent or group of joint depositors, a receipt for every amount received by the company by way of deposit.

(ii) The said receipt shall be duly signed by an officer authorised by the company in that behalf and shall state the date of deposit, the name of the depositor, the amount in words and figures received by the company by way of deposit, rate of interest payable thereon and the date on which the deposit is repayable :

Provided that, if such receipts pertain to instalments subsequent to the first instalment of a recurring deposit it may contain only name of the depositor and date and amount of deposit.

Register of deposit

(16)(i) Every non-banking financial company shall keep one or more registers in respect of all deposits in which shall be entered separately in the case of each depositor the following particulars, namely –

(a) name and address of the depositor,

(b) date and amount of each deposit,

(d) date and amount of accrued interest or premium on each deposit,

(e) date of claim made by the depositor,

(f) date and amount of each repayment, whether of principal, interest or premium,

(g) the reasons for delay in repayment beyond five working days and

(h) any other particulars relating to the deposit.

(ii) The register or registers aforesaid shall be kept at each branch in respect of the deposit accounts opened by that branch of the company and a consolidated register for all the branches taken together at the registered office of the company and shall be preserved in good order for a period of not less than eight calendar years following the financial year in which the latest entry is made of the repayment or renewal of any deposit of which particulars are contained in the register:

Provided that, if the company keeps the books of account referred to in subsection (1) of section 209 of the Companies Act, 1956 (1 of 1956) at any place other than its registered office in accordance with the proviso to that sub-section, it shall be deemed to be sufficient compliance with this clause if the register aforesaid is kept at such other place, subject to the condition that the company delivers to the Reserve Bank of India a copy of the notice filed with the Registrar of Companies under the proviso to the said sub-section within seven days of such filing.

⁴²[4A. Branches and appointment of agents to collect deposits

On and from January 13, 2000, no non-banking financial company shall open its branch or appoint agents to collect deposits except as provided hereunder :

(i) a non-banking financial company having the certificate of registration issued under section 45-IA of the Reserve Bank of India Act, 1934 (2 of 1934) and otherwise entitled to accept public deposits as per paragraph 4(4) of these Directions, may open its branch or appoint agents if its

(a)	NOF is up to Rs. 50 crore	Within the State where its registered office is situated; and
(b)	NOF is more than Rs. 50 crore and its credit rating is AA or above	Anywhere in India

(ii)(a) for the purpose of opening a branch, a non-banking financial company shall notify to the Reserve Bank of its intention to open the proposed branch;

(b) on receipt of such advice, the Reserve Bank may, on being satisfied that in the public interest or in the interest of the concerned non-banking financial company or for any other relevant reasons to be recorded, reject the proposal and communicate the same to the non-banking financial company;

(c) if no advice of rejection of the proposal under (b) above is communicated by the Reserve Bank within 30 days from the receipt of such advice, the non-banking financial company may proceed with its proposal.

4B. Closure of branches

No non-banking financial company shall close its branch/office without publishing such intention in any one national level newspaper and in one vernacular newspaper in circulation in the relevant place and without advising Reserve Bank of India, before ninety days of the proposed closure].

PART III – SPECIAL PROVISIONS

Information to be included in the Board’s report

5. (1) In every report of the Board of Directors laid before the company in a general meeting under sub-section (1) of section 217 of the Companies Act, 1956 (1 of 1956), there shall be included in the case of a non-banking financial company, the following particulars or information, namely :-

(i) the total number of accounts of public deposit of the company which have not been claimed by the depositors or not paid by the company after the date on which the deposit became due for repayment; and

(ii) the total amounts due under such accounts remaining unclaimed or unpaid beyond the dates referred to in clause (i) as aforesaid.

(2) The said particulars or information shall be furnished with reference to the position as on the last day of the financial year to which the report relates and if the amounts remaining unclaimed or undisbursed as referred to in clause (ii) of the preceding sub-paragraph exceed in the aggregate a sum of rupees five lakhs, there shall also be included in the report a statement on the steps taken or proposed to be taken by the Board of Directors for the repayment of the amounts due to the depositors remaining unclaimed or undisbursed.

Safe custody of approved securities

⁴³[6. (1) every non-banking financial company shall –

(i) open a Constituent’s Subsidiary General Ledger (CSGL) account with a scheduled commercial bank, or the Stock Holding Corporation of India Ltd. (SHCIL) or a dematerialized account with a depository through a depository participant registered with the Securities and Exchange Board of India and keep the unencumbered approved securities required to be maintained by it in pursuance of section 45-IB of the Reserve Bank of India Act, 1934 (2 of 1934) and the Notification No. DFC.121/ED(G)-98, dated January 31, 1998 in such CSGL account or dematerialised account;

(ii) designate one of the scheduled commercial banks, in the place where the registered office of the non-banking financial company is situated, as its designated banker and entrust, in physical form, to such bank or the SHCIL the unencumbered term deposits in any scheduled commercial bank maintained by it in pursuance of Notification No. DFC.121/ED(G)-98, dated January 31, 1998 and such unencumbered approved securities which have not been dematerialised;

and intimate the name and address of such scheduled commercial bank where it has opened its CSGL account or has held the securities in physical form, or the location of the SHCIL where it has opened its CSGL account or has held the securities in physical form or the depository (and the depository participant) where it has held its dematerialised account, in writing, to the Regional Office of the Reserve Bank of India under whose jurisdiction the registered office of the company is situated, as specified in Second Schedule hereto:

Provided that where a non-banking financial company intends to entrust the securities specified in clause (ii) above with the designated banker or SHCIL, at a place other than the place at which its registered office is located, it may do so with the prior approval, in writing, of the Regional Office of the Reserve Bank of India under whose jurisdiction the registered office of the company is situated, as specified in Second Schedule hereto:]

⁴⁴[Provided further that the government securities held in the said CSGL account or dematerialised account, shall not be traded, either by entering into ready forward contracts, including reverse ready forward contracts, or otherwise, except, by following the procedure and to the extent, as hereinafter specified.]

⁴⁵[(2) The securities mentioned in sub-paragraph (1) above shall continue to be kept as specified therein for the benefit of the depositors and shall not be withdrawn or encashed or otherwise dealt with by the non-banking financial company except for repayment to the depositors with the prior approval of Reserve Bank of India :

Provided that,

(i) a non-banking financial company may withdraw a portion of such securities in proportion to the reduction of its public deposits duly certified to that effect by its auditor;

(ii) where the non-banking financial company intends to substitute such securities kept in physical form, it may do so by entrusting securities of equal value to the designated bank or SHCIL before such withdrawal; and]

(iii) ⁴⁶[ the market value of these securities shall, at no point of time, be less than the percentage of public deposits as specified in Notification No.DFC.121/ED(G)-98, dated January 31, 1998.]

⁴⁷[(3) Where the non-banking financial company intends to trade, either by entering into ready forward contracts, including reverse ready forward contracts, or otherwise, in the government securities that are held in excess of the requirement under Section 45-IB of the Act and Notification No. DFC. 121/ED (G)-98, dated January 31, 1998, the same may be undertaken by opening a separate CSGL or dematerialised account for keeping such excess government securities.]

Employees Security Deposit

7. A non-banking financial company receiving any amount in the ordinary course of its business as security deposit from any of its employees for due performance of his duties shall keep such amount in an account with a scheduled commercial bank or in a post office in the joint names of the employee and the company on the conditions that –

(1) it shall not withdraw the amount without the consent in writing of the employee; and

(2) the amount shall be repayable to the employee along with interest payable on such deposit account unless such amount or any part thereof is liable to be appropriated by the company for the failure on the part of the employee for due performance of his duties.

Copies of balance sheet and accounts together with the Directors’ report, auditors’ report, notes on accounts and returns to be furnished to the Reserve Bank

8. (1) Every non-banking financial company accepting/holding public deposit shall deliver to the Reserve Bank of India an audited balance sheet as on the last date of each financial year and an audited profit and loss account in respect of that year as passed by the company in general meeting together with a copy of the report of the Board of Directors laid before the company in such meeting in terms of section 217(1) of the Companies Act, 1956 (1 of 1956) within fifteen days of such meeting as also a copy of the report and the notes on accounts furnished by its Auditor.

Provision for submitting Auditor’s Certificate

(2) Every non-banking financial company holding/accepting public deposits shall furnish to the Reserve Bank of India along with a copy of the audited balance sheet as provided in sub-paragraph (1) above, a copy of the Auditor’s report to the Board of Directors and a certificate from its auditor, to the effect that the full amount of liabilities to the depositors of the company, including interest payable thereon, are properly reflected in the balance sheet, and that the company is in a position to meet the amount of such liabilities to the depositors.

Returns to be submitted to the Reserve Bank of India

(3) Every non-banking financial company holding/accepting public deposits shall submit to the Reserve Bank of India a return furnishing the information specified in the First Schedule hereto, with reference to its financial position as on the date specified in the said Schedule.

(4) Every non-banking financial company shall, not later than one month from the occurrence of any change in the following matters, shall intimate to the Reserve Bank of India:

(i) the complete postal address, telephone number/s and fax number/s of the registered/corporate office;

(ii) the names and residential addresses of the directors of the company;

(iii) the names and the official designations of its principal officers;

(iv) the specimen signatures of the officers authorised to sign on behalf of the company; and

(v) the names and office address of the auditors of the company.

Balance sheet, returns, etc. to be submitted to the Department of Non-Banking Supervision

(5) Any balance sheets, returns or information or intimation or statement required to be submitted or furnished to the Reserve Bank of India in pursuance of these directions shall be submitted or furnished to the Regional Office of the Department of Non-Banking Supervision of the Reserve Bank of India within whose jurisdiction the registered office of the company is situated, as specified in the Second Schedule hereto.

Non-applicability of the Directions to certain types of non-banking financial companies

9. Nothing contained in paragraphs 4 to 8 of these directions shall be applicable to:

(1) an insurance company holding a valid certificate of registration issued under section 3 of the Insurance Act, 1938 (IV of 1938), or a stock exchange notified under section 4 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956), or a stock broking company defined in section 12 of the Securities and Exchange Board of India Act, 1992 (15 of 1992);

(2) a loan company, an investment company, an asset finance company ⁴⁸ not accepting/holding any public deposit:

Provided that the company passes in the meeting of its board of directors within thirty days of the issue of these directions and thereafter within thirty days of the commencement of the next financial year and each subsequent financial year, a resolution to the effect that the company has neither accepted public deposit nor would accept any public deposit during the year.

(3) an investment company,

(i) which has acquired shares/securities of its own group/holding/subsidiary companies only and such acquisition is not less than ninety per cent of its total assets at any point of time;

(ii) which does not trade in such shares/securities; and

(iii) which does not accept/hold any public deposit :

Provided that the company passes in the meeting of its board of directors within thirty days of the issue of these directions and thereafter within thirty days of the commencement of each subsequent financial year a resolution to the effect that the company has invested or would invest/hold its investments in the shares/securities of its group/holding/subsidiary companies of not less than 90 per cent of its assets and (name of each company to be specified), that it would not trade in such shares/securities and that it has neither accepted nor would accept any public deposit during the year.

⁴⁹[9A Nothing contained in paragraphs 4 to 7 shall apply to an NBFC being a Government company as defined under section 617 of the Companies Act, 1956 (1 of 1956). ]

Exemptions

10. The Reserve Bank of India may, if it considers necessary for avoiding any hardship or for any other just and sufficient reason, grant extension of time to comply with or exempt any company or class of companies from all or any of the provisions of these directions either generally or for any specified period subject to such conditions as the Reserve Bank of India may impose.

Saving of action taken or that may be taken for contravention of the Non-Banking Financial Companies (Reserve Bank) Directions, 1998

⁵⁰11. It is hereby clarified that the supersession of the Non-Banking Financial Companies (Reserve Bank) Directions, 1998 contained in Notification No.DFC.114/DG (SPT)-98, dated January 2, 1998 shall not in any way affect –

(i) any right, obligation or liability acquired, accrued or incurred thereunder;

(ii) any penalty, forfeiture or punishment incurred or suffered in respect of any contravention committed thereunder; and

(iii) any investigation, legal proceeding or action in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment taken or arising under the said directions,

and any such investigation, legal proceeding or action may be instituted, continued, or enforced and any such penalty, forfeiture or punishment may be imposed as if those directions had not been superseded.

Applicability of the directions to companies other than those mentioned in paragraph 2(1)

12. The provisions of these directions, as in force for the time being, shall apply to or in relation to every company which is a financial institution but does not belong to any of the categories of the companies mentioned in sub-paragraph (1) of paragraph 2 of these directions or is not a miscellaneous non-banking company within the meaning of the Miscellaneous Non-Banking Companies (Reserve Bank) Directions, 1977 or is not a residuary non-banking company within the meaning of Residuary Non-Banking Companies (Reserve Bank) Directions, 1987 as they apply to or in relation to a loan company.

Sd/-

(S.P. TALWAR)

DEPUTY GOVERNOR

Second Schedule

[Please see paragraph 6(1) of the Directions]

Area under the jurisdiction of each Regional Office of the

RESERVE BANK OF INDIA

	Name and address of the Office	Area under jurisdiction
1.	Ahmedabad Regional Office, La Gajjar Chambers, Ashram Road, Ahmedabad-380 009.	State of Gujarat and Union Territories of Daman and Diu and Dadra and Nagar Haveli
2.	Bangalore Regional Office, 10-3-8, Nrupathunga Road, Bangalore-560 002.	State of Karnataka.
3.	Bhopal Regional Office, Hoshangabad Road, Post Box No.32, Bhopal-462 011.	⁵¹ [States of Madhya Pradesh and Chhattisgarh ]
4.	Bhubaneswar Regional Office Pandit Jawaharlal Nehru Marg, Post Bag No.16, Bhubaneswar-751 001.	State of Orissa.
5.	⁵²[Kolkata] Regional Office, 15, Netaji Subhas Road, ⁵³[ Kolkata] 700 001.	States of Sikkim, and West Bengal and the Union Territory of Andaman and Nicobar Islands
6.	Chandigarh Regional Office, 11, Central Vista, New Office Building Opp. Telephone Bhavan, Sector 17, Chandigarh-160 017.	States of Himachal Pradesh, Punjab and the Union Territory of Chandigarh.
7.	Chennai Regional Office, Fort Glacis, Rajaji Salai, Chennai-600 001.	State of Tamil Nadu and Union Territory of Pondicherry.
8.	Guwahati Regional Office, Station Road, Pan Bazar, Post Box No.120, Guwahati-781 001.	States of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland and Tripura.
9.	Hyderabad Regional Office, 6-1-56, Secretariat Road, Saifabad, Hyderabad-500 004.	State of Andhra Pradesh.
10.	Jaipur Regional Office, Ram Bagh Circle, Tonk Road, P.B.No.12, Jaipur-302 004.	State of Rajasthan.
11.	Jammu Regional Office, Rail Head Complex, Post Bag No.1, Jammu-180 012.	State of Jammu and Kashmir.
⁵⁴[12.	Kanpur Regional Office Mahatma Gandhi Marg, Kanpur – 208 001 ]	²⁹[States of Uttar Pradesh and Uttaranchal]
13.	Mumbai Regional Office, Garment House, 4th Floor, Dr. Annie Besant Road, Worli, Mumbai-400 018.	States of Goa and Maharashtra
14.	New Delhi Regional Office, 6, Sansad Marg, New Delhi-110 001.	State of Haryana and National Capital Territory of Delhi.
15.	Patna Regional Office, South of Gandhi Maidan, Post Bag No.162, Patna-800 001.	²⁹ [States of Bihar and Jharkhand]
16.	Thiruvananthapuram Regional Office, Bakery Junction, Thiruvananthapuram-695 033	State of Kerala and Union Territory of Lakshadweep.

⁵⁵Form – NBS 1

Annual Return on Deposits as on 31 March, 20. . (To be submitted by all Non-Banking Financial Companies accepting/holding public deposits, and MNBCs – except Residuary Non-Banking Companies and MBFCs/MBCs⁵⁶

	File Number
	ID Number
	Nature of business
	District Code
	State Code
	(To be filled in by RBI)

Name of the Company: …………………………………..

Instructions for filling in the Return – General

1. This Return should be submitted by a Non-Banking Financial Company covered by Para 8(3) of Notification No.DFC.118/DG(SPT)-98, dated January 31, 1998 and by a Miscellaneous Non-Banking Company covered by para 11 of the Notification No.DNBC.39/DG (H)-77, dated June 20, 1977 to the Regional Office of Department of Non-Banking Supervision, Reserve Bank of India where its Registered Office is situated, once a year, after March 31 and latest by September 30, with reference to its position as on March 31, irrespective of the date of closing of the financial year of the Company concerned. A Certificate from the Auditors of the Company should be appended to the Return as per format furnished herewith. However, only in respect of Part-3, the information should be furnished as per the latest balance sheet but preceding the date of the return.

N.B. In terms of Notification No.DNBS.135/CGM(VSNM)-2000, dated 13-1-2000, NBFCs shall prepare their balance sheets and profit and loss accounts as on March 31, every year with effect from its accounting year ending with 31st March, 2001. Therefore with effect from accounting year ending 31st March, 2001, the information in Part 3 of the return shall be as on the date of current balance sheet thus coinciding with the date of return.

2. Submission of the Return should not be delayed for any reason such as the finalisation/completion of the Audit of the annual accounts. The compilation of the Return should be on the basis of the figures available in the books of account of the company and should be certified by its Statutory Auditors.

3. The number of accounts should be given in actual figures while the amounts of deposits should be shown in lakhs of rupees. The amount should be rounded off to the nearest lakh. Illustratively, an amount of Rs.4,56,100 should be shown as 5 and not as 4.6 or 5,00,000. Similarly, an amount of Rs.61,49,500 is to be shown as 61 and not as 61.5 or 61,00,000.

4. The Return should be signed by a Manager (as defined in section 2 of the Companies Act, 1956) and if there is no such Manager, by Managing Director or any official of the Company who has been duly authorised by the Board of Directors and whose Specimen Signature has been furnished to the Reserve Bank of India for the purpose. In case the Specimen Signature has not been furnished in the prescribed card, the Return must be signed by the authorised official and his Specimen Signature furnished separately.

5. In case there is nothing to report in any part/item of the Return, the relevant part/item may be marked ‘Nil’ in the column meant for “No. of accounts” and 00s may be indicated in the column meant for “Amount”.

6. ‘Subsidiaries’ and ‘Companies in the same group’ mentioned in this Return have the same meanings assigned to them in section 4 and section 372(11) respectively, of the Companies Act, 1956 as appearing prior to amendment to the Companies Act dated 31st October, 1998.

7. In case this return is being filed through electronic media (internet), to the specified Web Server, a hard-copy of the same may be submitted to the concerned Regional Office duly signed .

Company Profile

Name of the Company

Address of the Registered Office

Phone Nos.

Fax No.

e-mail address

Name of the State in which the company is registered

Address of the Corporate/ Head Office

Phone Nos

Fax No.

e-mail address

Date of Incorporation

Date of Commencement of Business

Name and Residential Address of :

(i) Chairman

(ii) Managing Director/ CEO

Is it a Government Company (Please tick)

Yes

Status of the company (Please tick):

(i) Public Ltd.

(ii) Deemed Public

(iii) Private Ltd.

(iv) Joint Venture

10.

Financial Year of the Company

11.

Nature of business

12.

Status of registration with RBI

(i) Number and Date of Certificate of Registration if issued by RBI

(ii) If not registered, indicate whether the application submitted for registration is rejected/ pending

13.

Classification of the Company (if given by Reserve Bank as HP/Leasing/Loan/Investment/ MBC etc. and reference number and date of such classification)

14.

Credit rating :

(i) Rating assigned

(ii) Date of rating

(iii) Name of the Rating Agency

(iv) Whether any change has occurred since the last rating (details)

15.

Number of Branches/Offices.

(Please enclose a list of names and addresses thereof in the format given below as per Note 1)

16.

If a subsidiary company, please indicate the name and address of the holding company

17.

If the company is having subsidiaries/associate companies, number thereof.

(Please enclose a list of names, addresses, Names of Directors and particulars of business activities thereof in the format given below as per Note 2)

18.

If a Joint Venture, name and address of the promoting institution(s)

19.

Name of the Company’s statutory auditors with address and phone numbers

20.

Name(s) of the company’s Bankers with addresses and phone numbers.

Note (1) : Format for furnishing details of branches:

Sl.No.	Name of the branch	Date of opening	Address	City	District	State	Amount of public deposit




	Total No. of Branches						Total Public Deposits of all the branches …..… (Amount)
							Total Public Deposits as per balance sheet dated …..(Amount)

Note (2) : Format for furnishing details of the subsidiaries:

Sl. No.	Name of the subsidiary	Address	Name of the Directors	Business Activity

Details of Assets and Liabilities (as on March 31, 200 …..)

Part – 1

Public Deposits

(Amount in lakhs of Rupees)

Item No.	Particulars	Item Code	Number of Accounts	Amount
1.	Deposits received from public in the form of Fixed Deposits, Recurring Deposits etc.	111
2.	(i) Deposits received from shareholders by a Public Limited Company.	112
	(ii) Deposits received from Joint shareholders other than the first named shareholder by a Private Limited Company.	113
3.	(i) Money received by issue of Non-convertible unsecured debentures (please see instruction No.1 given below)	114
	(ii) Any other type of public deposits (Please Specify)	115
4.	Total (111 to 115)	110
5.	Of the total Deposits at item 4 above, those repayable (i) within 1 year	121
	(ii) after 1 year but up to 2 years	122
	(iii) after 2 years but up to 3 years	123
	(iv) after 3 years but up to 5 years and	124
	(v) after 5 years	125
6.	Total (121 to 125)	120
7.	Break up of public deposits at item 4 above, as per rate of interest (excluding brokerage, if any) (i) Below 10%	131
	(ii) 10% or more but less than 12%	132
	(iii) 12% or more but less than 14%	133
	(iv) 14% or more but less than 16%	134
	(v) At 16%	135
	(vi) More than 16% but up to 18%	136
	(vii) More than 18%	137
8.	Total (131 to 137)	130
9.	Break-up of Public Deposits according to the size (i) Fixed deposits etc. received from public (vide item No. 1 above)
	(a) up to Rs.10,000	141
	(b) over Rs.10,000	142
	(ii) Deposits from shareholders in case of public limited companies (vide item No. 2 above)
	(a) up to Rs.10,000	143
	(b) over Rs.10,000	144
	(iii) Non-convertible unsecured debentures (vide item No.3 above)
	(a) up to Rs. 10,000	145
	(b) over Rs. 10,000	146
10.	Total of (141 to 146) [should tally with the amount shown against item 110 ]	140
11.	Of the deposits at item 4 above : (i) Those which have matured but not claimed.	151
	(ii) Those which have matured, claimed but not paid (please see instruction No. 2 given below) (a) From public (vide item No.1 above)	152 153
	(b) From shareholders (vide item No. 2 above)	154
	(c) From debenture holders (vide item No. 3 above) [Please furnish details of (a) (b) and (c) in Annexure No…..]	155
	(iii) Those shown against item (ii) above where CLB has passed the orders for repayment	156
12.	Public Deposits mobilised during the year by payment of brokerage	157
13.	Brokerage paid	158
14.	% of 13 to 12	159
15.	Public deposits matured but remaining unclaimed for 7 years including the year in which they have matured	160

Instructions:

1. In the case of partly convertible Debentures/Bonds, the convertible portion should be shown against item 9 of Part -2. The Non-convertible unsecured debentures should be included under this item.

2. The reasons for non-payment of each Deposit and the steps taken for repayment including compliance of CLB Order (if any) should be indicated in an Annexure.

Part – 2

Particulars of other borrowings

Item No.	Particulars	Item Code	Number of Accounts	Amount
1.	Money borrowed from the Central/State Government/Local Authority/others the repayment of which is guaranteed by the Central/ State Governments	221
2.	Money borrowed from: (i) Foreign Government	222
	(ii) Foreign Authority	223
	(iii) Foreign Citizen or person	224
	Total (222 to 224)	225
3.	Borrowings from : (i) Banks	226
3.	(ii) Other Specified Financial Institutions	227
4.	Money borrowed from any other Company	228
5.	Unsecured loans from Directors/Promoterss	229
6.	Money borrowed by a private Company from its shareholders	230
7.	Money received from employees of the Company by way of security deposit and kept in joint accounts in the name of the Company and the employees with a scheduled bank or a post office	231
8.	Money received by way of caution money, margin money from the borrowers, lessee, hirers or by way of security or advance from agents in the course of company’s business or advance received against orders for supply of goods or properties or for rendering of services	232
9.	Money received by issue of convertible or secured debentures/bonds (please see the instruction given below)	233
10.	Of the above, debentures subscribed by the banks/ other NBFCs.	234
11.	Money received by way of subscription to shares, bonds or debentures pending allotment or money received by way of calls in advance on shares (not due for refinance).	235
12.	Commercial Papers	236
13.	Deposits received from relatives of Directors	237
14.	Borrowings from Mutual Funds	238
15.	Any others (Not treated as public deposits – Please specify)	239
16.	Total (221 + 225 + 226 to 233+235 to 239)	250

Instruction:

In the case of Partly Convertible Debentures/Bonds, only the convertible portion should be shown against item 9 of Part -2 above.

Part – 3

Net Owned Fund

[Figures to be furnished as per the latest balance sheet preceding the date of the Return or as per balance sheet as on the date of return] [ Balance sheet as on ………… ]

Item No.	Particulars	Item Code	Amount
1.	Capital Funds : (i) Paid-up Equity Capital	311
	(ii) Paid-up preference shares which are compulsorily convertible to Equity	312
	(iii) Free Reserves (please see instruction No.1 given below)	313
2.	Total (311 +312 +313) = A	310
3.	(i) Accumulated balance of loss	321
	(ii) Balance of deferred revenue expenditure	322
	(iii) Other intangible assets (please specify)	323
4.	Total (321+322 +323) = B	320
5.	Owned Fund (A – B) i.e.(310-320) = C	330
6.	Book value of investments in shares of : (i) Subsidiaries of the Company	341
	(ii) Companies in the same group	342
	(iii) all other Non-Banking Financial Companies (Details in Annexure No……….)	343
7.	Book value of investments in debentures and bonds of : (i) Subsidiaries of the Company	344
7.	(ii) Companies in the same group (Details in Annexure No………)	345
8.	Outstanding loans and advances including bills purchased/ discounted, inter-corporate deposits, hire purchase and lease finance, CPs with: (i) Subsidiaries of the Company	346
8.	(ii) Companies in the same group (Details in Annexure No……..) [please see instruction No.2 given below]	347
9.	Total (341 to 347) = D	340
10.	D in excess of 10% of C (340 in excess of 10% of 330) = E	351
11.	Net Owned Fund (330 – 351) = (C – E)	350
12.	Paid-up preference Share Capital not compulsorily convertible, as per latest balance sheet	361
13.	Paid-up preference Share Capital not compulsorily convertible, as on the date of this Return	362
14.	Total liabilities as per the latest balance sheet preceding the date of Return	363
15.	Total liability as on the date of this Return	364

Instructions:

1. “Free Reserves” mentioned under item 1(iii) above shall include the balance in the Share Premium Account, Capital and Debenture Redemption Reserves and any other Reserve shown or published in the Balance Sheet and created through an allocation of Profits (including credit balance of Profit & Loss Account) but not being :

(i) a Reserve created for repayment of any future liability or for depreciation of assets or for provision against non-performing assets/bad debts; or

(ii) a Reserve created by Revaluation of the Assets of the Company.

2. Hire Purchase and Lease Finance mean :

(i) in the case of hire purchase asset, the amount of future instalments receivable reduced by the balance of the unmatured finance charges; and

(ii) in the case of lease assets, the depreciated book value of the lease asset plus/minus the balance in the lease adjustment account;

Amount due but not received should be added in both the cases.

Part – 4

Outstanding loans and advances, including Inter-Corporate Deposits/Commercial Papers

Item No.	Particulars	Item Code	Amount
1.	Loans and advances etc. in subsidiaries of the company	411
2.	Companies in the same group	412
3.	Companies, Firms and Proprietary Concerns where Directors of the Company hold substantial interest/are interested. (please see instruction No.1 given below). [Details in Annexure No……]	420
4.	Others: (i) Companies not in the same Group	431
	(ii) Directors/Promoters	432
	(iii) Shareholders	433
	(iv) Members of Staff	434
	(v) Depositors	435
	(vi) Others	436
5.	Total (411 +412 +420 +431 to 436)	400

Instructions:

(1) “Substantial interest” shall have the same meaning as assigned to it in Non-BankingFinancial Companies Prudential Norms (Reserve Bank) Directions, 1998.

(2) Sundry Debtors, Tax paid in advance and other Recoverable items not in the nature of loans and advances should not be shown in Part-4 above.

(3) Fixed Deposit with other companies should be included under items 1, 2, 3 and 4(i), as the case may be.

(4) Investment in unquoted debentures shall be treated as credit and not investment.

Part – 5 (i)

Investments (at book value)

Item No.	Particulars	Item Code	Amount
1.	Investments in –
	(i) Fixed deposits with banks/certificates of deposits issued by banks	541
	(ii) Balances in any other deposit accounts with bank(s)	542
	(iii) Securities of Central/State Govts. and bonds guaranteed by Central/State Govts.	543
	(iv) Units of Unit Trust of India	544
	(v) Others (Please specify………)	545
2.	Investments in shares: (i) Quoted	511
2.	(ii) Unquoted	512
3.	Investments in debentures and bonds	515
4.	Investments in shares of and debentures/bonds of companies where directors of the company hold substantial interest.(Please see the instruction No.1 of Part-4). (Details in Annexure No………..)	520
5.	Total [541 to 545 + 511 + 512 + 515 + 520]	500

Instructions:

(1) Details of shares, debentures and commercial papers held in investment account or by way of stock-in-trade should be included in this part.

(2) Fixed deposit with other companies should not be included here but should be shown in Part-4

(3) Investment in unquoted debentures/bonds shall be treated as credit and not investment.

Part – 5 (ii)

Quoted shares/debentures/bonds/commercial papers

Item No.		Particulars	Item Code	Amount
1.	Book value		551
2.	Market value		552

Part – 6

Hire Purchase Business

Item No.	Nature of goods on hire	Item Code	Number of Accounts	Amount
1.	Automobiles :
	(i) Heavy Commercial Vehicles	611
	(ii) Light Commercial Vehicles including two wheelers	612
	(iii) Others	613
2.	Total [611+612+613]	610
3.	Household durables	621
4.	Data processing/office automation equipment	622
5.	Agricultural implements (Tractors, Bulldozers, etc.)	623
6.	Industrial machinery or tools or equipment for use in industries	624
7.	All others	625
8.	Total [610+ 621 to 625]	600
9.	Of 8 above, dues from – Subsidiaries/Companies in the same group/Companies, firm and proprietary concerns where directors of the company hold substantial interest	691

Part – 7

Equipment Leasing business

Item No.	Nature of Equipment on Lease	Item Code	Gross Leased Assets	Accumulated depreciation +/-Lease Adjustment Account	Net Leased Assets plus amounts due but not received
1.	Plant & Machinery	701
2.	Data Processing/office equipment	702
3.	Vehicles	703
4.	Others	704
5.	Total (701+702+703+704)	700
6.	Of 5 above, dues from Subsidiaries/companies in the same group/companies, firms and proprietary concerns where directors of the company hold substantial interest/or are interested	791

Part – 8

Bills business

Item No.	Particulars	Item Code	Amount
1.	Bills purchased/discounted where the drawers, drawees or any endorsers are: (i) Subsidiaries of the company	801
	(ii) Companies in the same group	802
	(iii) Companies or firms in which any director of the company holds substantial interest or proprietary concerns owned by him	803
2.	Bills purchased/discounted other than 1 above	820
3.	Total (801 + 802 + 803 + 820)	800

Part – 9

Particulars about other fixed assets

Item No.	Particulars	Item Code	Amount
1.	Fixed assets (i) Land and Buildings for own use	901
	(ii) Land and Buildings – others	902
	(iii) Furniture and Fixtures	903
	(iv) Vehicles	904
2.	Other assets excluding intangibles	905
3	Total of other assets (901 + 902 + 903 + 904+905)	910
4.	Total assets [ excluding intangibles] (400 + 500 + 600 + 700 + 800 + 910]	900

Part – 10

Business statistics/information for the year ended 31 March, 200 …..

Item No.	Particulars	Item Code	Amount
1	I. Disbursements (Fund based activities) Equipment leasing:
	(a) Outstanding balances as on the date of the return	1001
	(b) Total disbursement during the year	1002
2	Hire purchase:
	(a) Outstanding balances as on the date of the return	1003
	(b) Total disbursement during the year	1004
3	Loans (a) Loans against shares to corporates:
	(i) Outstanding balances as on the date of the return	1005
	(ii) Total disbursement during the year	1006
	(b) Loans against shares to individuals:
	(i) Outstanding balances as on the date of the return	1007
	(ii) Total disbursement during the year	1008
	(c) Loans against shares to brokers:
	(i) Outstanding balances as on the date of the return	1009
	(ii) Total disbursement during the year	1010
	(d) Loans to finance Initial Public Offerings (IPOs):
	(i) Outstanding balances as on the date of the return	1011
	(ii) Total disbursement during the year	1012
	(e) Inter-corporate loans/deposits:
	(i) Outstanding balances as on the date of the return	1013
	(ii) Total disbursement during the year	1014
	(f) Others	1015
4	Bills Purchased/Discounted :
	(a) Outstanding balances as on the date of the return	1016
	(b) Total disbursement during the year	1017
5	Of 4, bills rediscounted :
	(a) Outstanding balances as on the date of the return	1018
	(b) Total volume during the year	1019
6	II. Trading in shares/securities (quoted other than SLR) Purchases/sales of shares/debentures/commercial papers: (a) Purchases	1020
6	(b) Sales	1021

7.	III. Fee based activities
	Guarantees issued for Capital Market Operations:
	(a) Outstanding balances as on the date of the return	1022
	(b) Total volume during the year	1023
8.	Guarantees issued for other purposes:
	(a) Outstanding balances as on the date of the return	1024
	(b) Total volume during the year	1025
9	Lease/Hire purchase syndicated during the year	1026
10.	Loan/ICDs syndicated during the year	1027
11	Bills syndicated during the year	1028
12	Underwriting :
	(a) Total amount underwritten	1029
	(b) Amount devolved	1030
	(c) Outstanding commitments	1031

Part – 10(A)

Status of overdues

Item No.	Particulars	Item Code	Amount
1.	Lease overdues more than 12 months	1041
2.	Lease overdues up to 12 months	1042
3.	Hire purchase overdues more than 12 months	1043
4.	Hire purchase overdues up to 12 months	1044
5.	Other overdues more than 6 months	1045
6.	Other overdues up to 6 months	1046
7.	Total (1041 to 1046)	1040

Part – 11

Particulars of selected Income and Expenditure

(Please see instructions given below).

1	Fund-based income : Gross lease income	1101
2	Less :Depreciation on Assets on Lease +/- Lease Equalisation	1102
3	Net lease income (1101-1102)	1103
4	Hire purchase income	1104
5	Bills discounting income	1105
6	Investment income (a) Dividend/interest	1106
6	(b) Profit/Loss (+/-) on sale of shares/debentures/commercial papers	1107
7	Interest income (a) Inter-corporate deposits/loans	1108
7	(b) Other loans and advances	1109
8	Other fund based income	1110
9	Total fund based income (1103 to 1110)	1111
10	Fee based income Income from merchant banking activities	1112
11	Underwriting commission	1113
12	Income from syndication of bills, loans, ICDs, lease & hire purchase	1114
13	Miscellaneous income	1115
14	Total fee-based income (1112 to 1115)	1116
15	Total Income (1111 + 1116)	1100
16	Interest and other financing costs Interest paid on fixed deposits	1117
17	Interest paid on ICDs	1118
18	Brokerage	1119
19	Reimbursement of expenses to brokers	1120
20	Other financing costs	1121
21	Bills rediscounting charges	1122
22	Total financing costs (1117 to 1122)	1123
23	Operating expenses Employee costs	1124
24	Other administrative costs	1125
25	Total operating costs (1124 + 1125)	1140
26	Depreciation on own assets	1126
27	Intangible assets amortised	1127
28	Provision for diminution in value of investments	1128
29	Provision against Non-Performing Assets	1129
30	Other Provisions if any	1130
31	Total expenses (1123 +1140 + 1126 to 1130)	1150
32	Profit before tax (1100 – 1150)	1160
33	Tax	1170
34	Profit after tax (1160 – 1170)	1180

Instructions :

(1) Particulars in this part should be for a full financial year. If the company closes its books on any date other than on 31st March, the date of closing of the books and the period should be indicated.

(2) “Gross lease income” includes lease rentals (net of rebate), lease management fees, lease service charges, up-front fees, profit on sale of leased assets and delayed/late payment charges relating to lease business (including interest/compensation charges on advance payment for purchase of assets in respect of lease agreements entered into/finalised).

(3) ‘Lease equalisation account’ has the same meaning as in the Guidance Note on Accounting for Lease (revised) issued by ICAI.

(4) ‘Hire purchase income’ includes finance charges (net of rebate), hire service charges, delayed/late payment charges, up-front fees and other income relating to hire purchase business (including interest earned on advance payment for acquisition of hire purchase assets for identified hirers)

CERTIFICATE

1. Certified that the directions contained in the Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998* (as amended from time to time)/Miscellaneous Non-Banking Companies (Reserve Bank) Directions, 1977*, as the case may be, are being complied with.

2. Further certified that the particulars/information furnished in this Return have been verified and found to be correct and complete in all respects.

(* Please delete whichever is not applicable)

Signature of Manager/Managing Director/Authorised Official

Date:

Place:

Auditor’s Report

We have examined the books of account and other records maintained by ………………. Company Ltd. in respect of the data furnished in this return and report that to the best of our knowledge and according to the information and explanations given to us and shown by the records examined by us, the data furnished in this return are correct.

Place:	Signature:
Date:	Name of the Chartered Accountants

Enclosures to the return :

1. The following documents should be submitted along with the return in case they have not already been sent. Please tick in the box against the item for the documents enclosed and state the date of submission in other cases.

(i) A copy of the audited balance sheet and profit and loss account dated nearest to the date of return.

(ii) Specimen signature card.

(iii) A copy of application form referred to in paragraph 4(12) of the Notification No.DFC.118/DG(SPT)-98, dated January 2, 1998 or paragraph 6 of the Notification No.DNBC.39/DG(H)-77, dated the 20th June, 1977.

2. A list of Principal officers and the names and addresses of directors in the form enclosed is to be sent with this return.

Part – 12

List of principal officers and directors of ……………………… Ltd.

I. Principal Officers

Sl. No.	Name	Designation	Address & Tel. No.	If director in any company/ies, name(s) of the company/ies

II. Directors

Sl.No.	Name	Address	% of equity shares of the company held by the director, his spouse and minor children	Names of other companies where he/she is a director

	Signature of Manager/Managing Director/ Authorised Official
Name : …………………………….
Designation : ………………………
Place: ……………………………..
Date : …………………………….

1. Inserted vide Notification No. 189, dated December 06, 2006

2. Deleted vide Notification No. 189, dated December 06, 2006

3. Deleted vide Notification No. 189, dated December 06, 2006

4. Substituted vide Notification No.189, dated December 06, 2006

5. Inserted, vide Notification No.134, dated January 13, 2000

6. Substituted vide Notification No.189, dated December 06, 2006

7. Inserted vide Notification No.134, dated January 13, 2000

8. Inserted, vide Notification No. 133, dated November 15, 1999

9. Inserted, vide Notification No. 134, dated January 13, 2000 and renumbered as (i) vide Notification No.141, dated June 30, 2000

10. Inserted, vide Notification No. 141, dated June 30, 2000

11. Inserted, vide Notification No. 148, dated June 27, 2001

12. Inserted, vide Notification No. 203, dated October 29, 2008

13. Inserted vide Notification No DNBS (PD) CC.No.203/03.10.001/2010-2011, dated October 22, 2010

14. Inserted, vide Notification No.127, dated December 18, 1998

15. Substituted vide Notification No.189, dated December 06, 2006

16. Deleted vide Notification No.189, dated December 06, 2006

17. Deleted, vide Notification No.197, dated November 22, 2007

18. Substituted, vide Notification No.197, dated November 22, 2007

19. Inserted, vide Notification No.134, dated January 13, 2000

20. Substituted vide, Notification No.189, dated December 06, 2006

21. Substituted vide, Notification No.148, dated June 27, 2001

22. Substituted vide, Notification No.159, dated October 1, 2002

23. Substituted vide, Notification No.189, dated December 06, 2006

24. Substituted vide, Notification No.189, dated December 06, 2006

*To ensure a measured movement towards strengthening the financials of all deposit taking NBFCs by increasing their NOF to a minimum of Rs. 200 lakh in a gradual, non-disruptive and non-discriminatory manner, vide Notification DNBS No.199 –CGM(PK)-2008 it was prescribed that:

(a) As a first step, NBFCs having minimum NOF of less than Rs. 200 lakh may freeze their deposits at the level currently held by them.

(b) Further, Asset Finance Companies (AFC) having minimum investment grade credit rating and CRAR of 12% may bring down public deposits to a level that is 1.5 times their NOF while all other companies may bring down their public deposits to a level equal to their NOF by March 31, 2009..

(c) Those companies which are presently eligible to accept public deposits up to a certain level, but have, for any reason, not accepted deposits up to that level will be permitted to accept public deposits up to the revised ceiling prescribed above.

(d) Companies on attaining the NOF of Rs.200 lakh may submit statutory auditor’s certificate certifying its NOF.

(e) The NBFCs failing to achieve the prescribed ceiling within the stipulated time period, may apply to the Reserve Bank for appropriate dispensation in this regard which may be considered on case to case basis.

25. Substituted vide, Notification No.189, dated December 06, 2006

26. Substituted vide, Notification No.189, dated December 06, 2006

27. Substituted vide, Notification No.189, dated December 06, 2006

28. Substituted vide, Notification No.189, dated December 06, 2006

29. Substituted vide, Notification No.189, dated December 06, 2006

30. Substituted vide, Notification No.189, dated December 06, 2006

31. Substituted, vide Notification No.195, dated April 24, 2007

32. Inserted, vide Notification No.174, dated September 17, 2003

33. Inserted, vide Notification No. 179, dated October 5, 2004

34. Substituted vide, Notification No. 189, dated December 06, 2006

35. Inserted, vide Notification No. 134, dated January 13, 2000

36. Inserted, vide Notification No. 134, dated January 13, 2000

37. Inserted, vide Notification No. 127, dated December 18, 1998

38. Inserted, vide Notification No. 159, dated October 1, 2002

39. Inserted, vide Notification No. 194, dated April 4, 2007

40. Substituted, vide Notification No. 179, dated October 5, 2004

41. Inserted vide Notification No. DNBS. 182/CGM (PK)-2005, dated December 9, 2005

42. Inserted, vide Notification No.134, dated January 13, 2000

43. Substituted, vide Notification No.159, dated October 1, 2002

44. Inserted, vide Notification No.170, dated July 31, 2003

45. Substituted, vide Notification No.159, dated October 1, 2002

46. Clause (iii) deleted and clause (iv) renumbered, vide Notification No. 170, dated July 31, 2003

47. Inserted, vide Notification No.170, dated July 31, 2003

48. Substituted vide Notification No.189, dated December 06, 2006

49. Inserted vide, Notification No. 134, dated January 13, 2000

50. Inserted vide Notification No. DNBS. 213/CGM(ASR)-2010, dated February 12, 2010

51. Substituted, vide Notification No. 148, dated June 27, 2001

52. Substituted, vide Notification No. 148, dated June 27, 2001

53. Substituted, vide Notification No. 148, dated June 27, 2001

54. Substituted, vide Notification No. 148, dated June 27, 2001

55. Substituted, vide Notification No.141 for NBFCs and 145 for MNBCs both dated June 30, 2000

56. Inserted vide Notification No. 191, dated January 4, 2007 [DNBS (PD) CC. No. 88/03.02.21/2006-07, dated January 04, 2007]

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NBFCs – RBI's Master Circular dated 1-7-2011 on Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998

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