CS Pankaj Kumar Singhal
Decoding of Deposits under Companies Act, 2013 with Rules Framed Thereunder
Deposits and/ or unsecured loans have been proved an essential and major source of financing in the corporate sector since the time of its recognitions. This is an essential tools of the growth of the private sector as well by reasons of least cost as well as controlling, The law maker had also taken the lenient view, while drafted the laws governing deposits/ unsecured loans prior to the formation/ implementation of the Companies Act, 2013.
However, this is also a truth that due to the least control and cost, some of the person/ corporate group has taken undue advantage and made fraud with the general public.
Under the Companies Act, 2013, law maker has taken due care for the controlling/ safety measures including the limits within which this source of funding may be availed/ utilized. Allowance of deposits has been made from members as well as from the general public, subject to some restrictions/ procedural aspects/ limits/ security etc.
The complete provisions relating to the deposits is covered under chapter V (Acceptance of deposits by Companies) covering section 73 to 76 read with Companies (Acceptance of Deposits) Rules, 2014.
Further, Deposits and/ or unsecured loans also has a small applicability of section 117(3)(g) ((Resolutions and Agreements to be filed) read with section 179(3) (Powers of Board) for the filing of resolutions with the Registrar with 30 days of the meeting of board of directors. It also has some relevance of section 185 (Loan to directors, etc.) along with section 186 (Loan and investment by company). The brief of the same can be understood as under:-
|Point No.||Base Point of Difference||Point of Difference based on the types of category|
|1||Status of Company||Private Company||Public company (Other than Eligible Company)||Public Company (Who has been treated as eligible Company within the meaning of Section 76 (1) i. e. Public Company having Net worth of Rs. 100 Crore or More or Turnover of Rs. 500 Crore or more (and has passed prior Special resolution and filed with ROC/ and has passed Ordinary Resolution, if the deposits to be accepted is within the limit specified under section 180(1)©|
|2||From Whom can take||From Directors and Members||From Directors and Members||From Directors/ Members and General Public|
|3||Conditions for Deposits to be taken from Directors||It is allowed to be taken without any Limit. However, Director has to furnish declaration at the time of money being given to the company that the amount is not being given out of the funds acquired by him by borrowing or accepting loans or deposits from others.||It is allowed to be taken without any Limit. However, Director has to furnish declaration at the time of money being given to the company that the amount is not being given out of the funds acquired by him by borrowing or accepting loans or deposits from others.||It is allowed to be taken without any Limit. However, Director has to furnish declaration at the time of money being given to the company that the amount is not being given out of the funds acquired by him by borrowing or accepting loans or deposits from others.|
|However, care here should be taken that the person giving loan is an interested director and should not participate and vote at the time while the resolutions for the same is discussed and passed within the meaning of section 117(3)(g) read with section 179(3) together with Section 174 of the Act.|
|3||From Shareholders||It is allowed to be taken subject to the limit of 25 % of the Paid up share capital and free reserves subject to compliance of provisions of section 73(2) of the Act.||It is allowed to be taken subject to the limit of 25 % of the Paid up share capital and free reserves subject to compliance of provisions of section 73(2) of the Act.||It is allowed to be taken subject to the limit of 10 % of the Paid up share capital and free reserves subject to compliance of provisions of section 73(2) and 76 of the Act.|
|Provided that at any point of time, deposit shall not exceed 25% of Paid up capital and free reserves.|
|From Public||Not Allowed to be taken||Not Allowed to be taken||It is allowed to be taken subject to the limit of 25 % of the Paid up share capital and free reserves.However, in case of Government company, who is eligible to accept deposits from public under section 76, It is allowed to be taken subject to the limit of 35 % of the Paid up share capital and free reserves.|
|Advertisement||Not Necessary||Not Necessary||Necessary|
|Credit Rating||Required to be taken before the submission of the circular to the registrar as is an essential disclosure of the said Circular.||Required to be taken before the submission of the circular to the registrar as is an essential disclosure of the said Circular.||Required to be taken (Including the rating of its net worth, liquidity and ability to pay its deposits on due date) before the submission of the circular to the registrar as is an essential disclosure of the said Circular.Further, the said rating shall also be obtained for every year during the tenure of deposits.|
|Display of Circular on Website||Optional||Optional||Mandatory, if any|
|Some other provisions, which are applicable on the same line of action has been combined herein under|
|Secured/ Unsecured||Both can be issued|
|Tenure||Period of deposits shall not be less than 6 months and not more than 36 Months. However, Deposits upto 10 % of the paid up capital and free reserves may be taken for a duration which shall not be less than 3 months.|
|Brokerage||It is allowed to be given to the broker appointed and authorized in writing and at the rate not exceeding the rate prescribed by the RBI for NBFC.|
|11||Joint Ownership||Not exceeding 3 person can hold the deposits in Joint name with or without any of the clauses namely “Jointly”, “Either or Survivor”, “First named or survivor” or “Anyone or Survivor”|
|Rate of Interest||It can be given at the rate not exceeding the rate prescribed by the RBI for NBFC|
|Deposit Insurance||An deposit insurance contract is required to be executed before the issue of the circular, which shall ensure the repayment of the deposits.(As per notification no. G.S.R. 386(E) dated 6th June, 2014 issued by the ministry of Corporate Affairs:- In rule 5, in sub-rule (1), the following proviso has been inserted, namely:-“Provided that the companies may accept the deposits without deposit insurance contract till the 31st March, 2015.”)|
|Declaration of Non borrowed fund||Application form for deposit shall contain a declaration that deposit is not being made out of the funds borrowed by him from any other person.|
|“Unsecured Deposits” to be quoted||Where the proposed deposits is unsecured or is secured partially, the deposits shall be termed as “unsecured deposits” and shall be quoted in every circular, form, advertisement or in any other document relating to invitation or acceptance of deposits.|
|Premature payment||In case of premature payment of deposits, 1% shall be reduced from the interest agreed to be paid.|
|Penal Interest||@18% per annum for overdue period.|
|Deposit repayment reserve account||On or before 30th April of each year a sum not less than 15% of the amount of deposits maturing in the current financial year and the next financial years shall be deposited in a scheduled bank in a separate account called deposit repayment reserve account which shall be free from charge or lien and the funds therein shall not be used by the company for any purpose other than repayment of deposits.|
While the government have consider the numerous complaint from a large number of public for non repayment of deposits from the deferent corporate as well as on been failure to assist in an effective manner to control the same and get the money revert to the depositor, government has taken hard informative, procedural and security measures, which ultimately will depressed the corporate world to utilize this effective source of funding and ultimately will affect its growth.
It is the observations of the author that while making rules and regulations, the government should have taken the lenient view for acceptance of deposits at least from the members and should had made rules and regulations to promote the deposits from members and close relatives which are the backbone funding source.
It appears to the author that while taking hard measures for deposits from the public, it has gone beyond the initial thinking of taking controlling measures and has hit the hammer on the backbone source of funding.
CONFUSION REGARDING DEPOSITS ACCEPTED EARLIER
It perhaps the most critical issue remained unclassified about the deposits taken prior to the implementation of the definitions of Private Company under The Company Act, 2013 as given under section 2(68) with exclusion of the permission of taking deposits from Members/ Director and their relatives.
The confusion continued due to the non specification about any kind of clarification as well as rules during the period covered from the implementation of the definitions and till the period of 31st March, 2013.
Moreover, after the implementation of Section 2(31) as well as Chapter V read with its rules, direct issue relating as to what kinds of measures should be taken to deal with the deposits/ unsecured loans from members/ Director or their relatives/ Body corporate has not been dealt with specifically.
There author here has tried his best efforts to clear the picture in relation to the same:-
1) Period prior to 12th September, 2013:-
Prior to the implementation of the definitions of Private Company in Section 2(68) of The Companies Act, 2013, Private Company was defined in Section 3(1)(iii) of The Companies Act, 1956 with sub clause (d) which is read as under:-
“prohibits any invitation or acceptance of deposits from persons other than its members, directors or their relatives”
Being deposits, here is also useful to understand some of the Rules in relation to deposits namely Companies (Acceptance of Deposits) Rules, 1975 made by the central government under section 58A read with Section 642 of The Companies Act, 1956.
Rule 2(b): “deposit” means any deposit of money with, and includes any amount borrowed by, a company, but does not include-
2(b)(iv): “any amount received by a Company from any other Company”
2(b)(vii): “any amount received by way of subscriptions to any shares, stock, bonds or debentures such bonds or debentures as are covered by sub-clause (x) 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”
2(b)(ix) “any amount received by a private company from a person who, at the time of the receipt of the amount, was a director, relative of director or member: Provided that the director or member, as the case may be, from whom 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”
2(b)(xi) any amount brought in by the promoters by way of unsecured loans in pursuance of stipulations of financial institutions subject to the fulfillment of the following conditions, namely:-
(a) the loans are brought in pursuance of the stipulation imposed by the financial institutions in fulfillment of the obligation of the promoters to contribute such finance ;
(b) the loans are provided by the promoters themselves and/or by their relatives, and not from their friends and business associates ; and
(c) the exemption under this sub-clause shall be available only till the loans of financial institutions are repaid and not thereafter.
Rule 2(c): “Depositor” includes any person who has given a loan to a company.
On going through the above, it can clearly understand that the deposits from Members/ Director and their relatives/ Other Company was exempt. There was no dilemma under The Companies Act, 1956.
It is also clear that unsecured loans as covered under Rules 2© is deposits within the meaning of Section 3(1)(iii) of The Companies Act, 1956 read with Companies (Acceptance of Deposits) Rules, 1975.
It should also be kept in mind that the provisions of section 205C do not get violated.
2) Period on or After 12th September, 2013 and upto 31st March, 2014
After the implementation of the definitions of Private Company in Section 2(68) of The Companies Act, 2013, although the definitions had been made effective, however, the following provisions under The Companies Act, 2013 could not be made effective due to non preparation of Rules:-
Section 2(31) Deposits: Definition of Deposits
Section 73 to 76 (Chapter V) – Acceptance of Deposits by Companies
Rules: Companies (Acceptance of Deposits) Rules, 2014
The lawmaker intentionally defers the implementation of all the above provisions. Therefore the period covered here comprises the following provisions:-
Section 2(68): Private Company
Section 58A Read with its Rules Companies (Acceptance of Deposits) Rules, 1975
Therefore the position here becomes clear that the rules namely Companies (Acceptance of Deposits) Rules, 1975 was effective during the period i. e. 12th September, 2013 and upto 31st March, 2014 and therefore deposits from other body corporate was also exempt under Rule 2(b)(iv). Further deposits from members/ director and their relatives was also exempt under Rule 2(b)(ix) provided that the director or member, as the case may be, from whom 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.
It should also be kept in mind that the provisions of section 205C do not get violated.
3) Period After 31st March, 2014
Now, on or after 1st of April, 2014, all the provisions of The Companies Act, 2013 i. e. Section 2(31) defining deposits as well as Chapter V read with Companies (Acceptance of Deposits) Rules, 2014 has been made effective (Other than Section 74(2) and (3) which have been made applicable from 06th June, 2014 vide circular no. S. O. 1459(E) dated 06.06.2014) in relation to deposits and all the liberties to take unsecured loans/ deposits is taken back with effect from 1st April, 2014.
In the opinion of the author, as there is no specific exemptions been provided under The Companies Act, 2013, all the Deposits from Exempted Categories earlier, becomes due for refund automatically together with the interest due thereon.
Section 74 (1), which has also been made effective is being reproduced here for clear understanding:-
74 (1): Where in respect of any deposit accepted by a company before the commencement of this Act, the amount of such deposit or part thereof or any interest due thereon remains unpaid on such commencement or becomes due at any time thereafter, the company shall—
(a) file, within a period of three months from such commencement or from the date on which such payments, are due, with the Registrar a statement of all the deposits accepted by the company and sums remaining unpaid on such amount with the interest payable thereon along with the arrangements made for such repayment, notwithstanding anything contained in any other law for the time being in force or under the terms and conditions subject to which the deposit was accepted or any scheme framed under any law; and
(b) repay within one year from such commencement or from the date on which such payments are due, whichever is earlier.
On plain reading of the above said Section, it is clear that the sum accepted prior to 1st April, 2014 is required to be repaid within the maximum period of one year (i. e. 31st April, 2015) from the date of commencement (i. e. 1st April, 2014)
It should also be kept in mind that there is a need to submit Form DPT-4 within the meaning of Section 74(1) upto the date of 30th June, 2014. The Ministry, vide General Circular 27/2014 dated 30th June, 2014, has granted extension for 2 months i.e. upto 31-08-2014 for filing of Form DPT4 without any additional fee.Online GST Certification Course by TaxGuru & MSME- Click here to Join
The procedure to accept the deposits can be summarized as under:-
1) Convene a meeting of the Board of Directors to consider and approve the business to propose and accept deposit from Director/Member/ Public. In the case of Eligible Companies, approval by means of Special/ Ordinary Resolutions from the members is also required.
Once the proposal is approved, Authority to directors to approach to the credit rating agency for the grant of rating, execution of deposit insurance contract (See notification no. G.S.R. 386(E) dated 6th June, 2014), Appointment of depositor trustee and Execution of trust deed, if the deposits are secured, Appointment of registered valuer, discussion and preparation of Circular for the issue of deposits may be given. Since the provisions of registered valuer have not been notified and as per clarification valuation should be done by Chartered Accountant having experience of 10 years or more or from Merchant Banker.
1) Submit form MGT 14 with the Registrar of Companies within 30 days of passing the resolution.
2) Submit the circular in the form DPT 1 with the ROC.
3) Submit form CHG 1 with ROC (Applicable in case of secured deposits) for assets other than intangible assets and for an amount which shall not be less than the amount remaining unsecured by the deposit insurance (See notification no. G.S.R. 386(E) dated 6th June, 2014). Secured deposits including interest thereon can in no case exceed the market value of the charged assets assessed by the registered valuer.
4) Submit form DPT 2 with ROC at least 7 days before the issue of Circular to the members.
5) After the expiry of 30 days of filing DPT 1, the Circular in form DPT 1 along with application form is sent to all members by registered post with acknowledgement due/ Speed post/ electronic mail. Take note that, in case of eligible companies proposed to accept deposit from public is also required to issue advertisement (One in English newspaper and one newspaper in vernacular language having wide circulation in the state in which the registered office of the company is situated.
Said Circular/ advertisement shall be valid till before the expiry of 6 months from the end of respective financial year in which it was issued or up to the date of Annual General Meeting (or last due date of AGM, if not held) wherein the financial statement is laid before members, whichever is earlier.
6) Upload the circular/ advertisement on the Company Website, if any.
7) Collect duly signed application form along with money.
8) Issue receipts of deposits within 21 days of the receipts of money/ realization of cheque.
9) Maintain register of deposits which shall contain the details as prescribed under rule 14 Companies (Acceptance of Deposits) Rules, 2014.
10) Pay interest at per the rate proposed on agreed terms.
11) Submit return of Deposits in form DPT 3 on or before 30th June each year for information as on 31st March of respective year.
12) Open “Deposit Repayment Reserve Account” with schedule bank and transfer at least 15% of the deposit maturing during the financial year and financial year next following.
Care should be taken that the so deposited shall not be utilized for any purpose other than for the repayment of deposits and the amount remaining deposited shall not at any time fall below fifteen per cent. of the amount of deposits maturing, until the end of the current financial year and the next financial year.
REPAYMENT OF DEPOSITS ACCEPTED ON OR BEFORE 31ST MARCH, 2014
a) All Companies having outstanding deposit or interest thereon shall be filed with ROC in form DPT 4 within 3 months from the Commencement of the Act (i. e. 30th June, 2014) or from the date on which such payment are due. The Ministry, vide General Circular 27/2014 dated 30th June, 2014, has granted extension for 2 months i.e. upto 31-08-2014 for filing of Form DPT4 without any additional fee.
b) Repay within one year from such commencement or from the date on which such payments are due, whichever is earlier.
NON APPLICABILITY OF THE RULES:-
These rules shall apply to a company other than –
(i) a banking company;
(ii) a non-banking financial company as defined in the Reserve Bank of India Act, 1934 (2 of 1934) registered with the Reserve Bank of India;
(iii) a housing finance company registered with the National Housing Bank established under the National Housing Bank Act, 1987 (53 of 1987); and
(iv) a company specified by the Central Government under the proviso to sub-section (1) of section 73 of the Act.
“Deposit” includes any receipt of money by way of deposit or loan or in any other form, by a company, but does not include –
(i) any amount received from the Central Government or a State Government, or any amount received from any other source whose repayment is guaranteed by the Central Government or a State Government, or any amount received from a local authority, or any amount received from a statutory authority constituted under an Act of Parliament or a State Legislature ;
(ii) any amount received from foreign Governments, foreign or international banks, multilateral financial institutions (including, but not limited to, International Finance Corporation, Asian Development Bank, Commonwealth Development Corporation and International Bank for Industrial and Financial Reconstruction), foreign Governments owned development financial institutions, foreign export credit agencies, foreign collaborators, foreign bodies corporate and foreign citizens, foreign authorities or persons resident outside India subject to the provisions of Foreign Exchange Management Act, 1999 (42 of 1999) and rules and regulations made there under;
(iii) any amount received as a loan or facility from any banking company or from the State Bank of India or any of its subsidiary banks or from a banking institution notified by the Central Government under section 51 of the Banking Regulation Act, 1949 (10 of 1949), or a corresponding new bank as defined in clause (d) of section 2 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of 1970) or in clause (b) of section (2) of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980), or from a co-operative bank as defined in clause (b-ii) of section 2 of the Reserve Bank of India Act, 1934 (2 of 1934);
(iv) any amount received as a loan or financial assistance from Public Financial Institutions notified by the Central Government in this behalf in consultation with the Reserve Bank of India or any regional financial institutions or Insurance Companies or Scheduled Banks as defined in the Reserve Bank of India Act, 1934 (2 of 1934);
(v) any amount received against issue of commercial paper or any other instruments issued in accordance with the guidelines or notification issued by the Reserve Bank of India;
(vi) any amount received by a company from any other company;
(vii) any amount received and held pursuant to an offer made in accordance with the provisions of the Act towards subscription to any securities, including share application money or advance towards allotment of securities pending allotment, so long as such amount is appropriated only against the amount due on allotment of the securities applied for;
Explanation. – – For the purposes of this sub-clause, it is hereby clarified that –
(a) Without prejudice to any other liability or action, if the securities for which application money or advance for such securities was received cannot be allotted within sixty days from the date of receipt of the application money or advance for such securities and such application money or advance is not refunded to the subscribers within fifteen days from the date of completion of sixty days, such amount shall be treated as a deposit under these rules.
(b) any adjustment of the amount for any other purpose shall not be treated as refund.
(viii) any amount received from a person who, at the time of the receipt of the amount, was a director of the company:
Provided that the director from whom 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 loans or deposits from others;
(ix) any amount raised by the issue of bonds or debentures secured by a first charge or a charge ranking pari passu with the first charge on any assets referred to in Schedule III of the Act excluding intangible assets of the company or bonds or debentures compulsorily convertible into shares of the company within five years:
Provided that if such bonds or debentures are secured by the charge of any assets referred to in Schedule III of the Act, excluding intangible assets, the amount of such bonds or debentures shall not exceed the market value of such assets as assessed by a registered valuer;
(x) any amount received from an employee of the company not exceeding his annual salary under a contract of employment with the company in the nature of non-interest bearing security deposit;
(xi) any non-interest bearing amount received or held in trust;
(xii) any amount received in the course of, or for the purposes of, the business of the company,-
(a) as an advance for the supply of goods or provision of services accounted for in any manner whatsoever provided that such advance is appropriated against supply of goods or provision of services within a period of three hundred and sixty five days from the date of acceptance of such advance:
Provided that in case of any advance which is subject matter of any legal proceedings before any court of law, the said time limit of three hundred and sixty five days shall not apply:
(b) as advance, accounted for in any manner whatsoever, received in connection with consideration for property under an agreement or arrangement , provided that such advance is adjusted against the property in accordance with the terms of agreement or arrangement;
(c) as security deposit for the performance of the contract for supply of goods or provision of services;
(d) as advance received under long term projects for supply of capital goods except those covered under item (b) above:
Provided that if the amount received under items (a), (b) and (d) above becomes refundable (with or without interest) due to the reasons that the company accepting the money does not have necessary permission or approval, wherever required, to deal in the goods or properties or services for which the money is taken, then the amount received shall be deemed to be a deposit under these rules:
Explanation.- For the purposes of this sub-clause the amount referred to in the first proviso shall be deemed to be deposits on the expiry of fifteen days from the date they become due for refund.
(xiii) any amount brought in by the promoters of the company by way of unsecured loan in pursuance of the stipulation of any lending financial institution or a bank subject to fulfillment of the following conditions, namely:-
(a) the loan is brought in pursuance of the stipulation imposed by the lending institutions on the promoters to contribute such finance;
(b) the loan is provided by the promoters themselves or by their relatives or by both; and
(c) the exemption under this sub-clause shall be available only till the loans of financial institution or bank are repaid and not thereafter;
(xiv) any amount accepted by a Nidhi company in accordance with the rules made under section 406 of the Act.
Explanation.- For the purposes of this clause, any amount.-
(a) received by the company, whether in the form of installments or otherwise, from a person with promise or offer to give returns, in cash or in kind, on completion of the period specified in the promise or offer, or earlier, accounted for in any manner whatsoever, or
(b) any additional contributions, over and above the amount under item (a) above, made by the company as part of such promise or offer,shall be treated as a deposit.
“Paid-up share Capital” or “Share capital paid-up” means such aggregate amount of money credited as paid-up as is equivalent to the amount received as paid-up in respect of shares issued and also include any amount credited as paid-up in respect of shares of the company, but does not include any other amount received in respect of such shares, by whatever name called.
“Free reserves” means such reserves which, as per the latest balance sheet of a company, are available for distribution as dividend:
(i) Any amount representing unrealized gains, notional gains or revaluation of assets, whether shown as a reserve or otherwise, or
(ii) Any change in carrying amount of an assets or of a liability recognized in equity, including surplus in profits and loss account on measurement of the assets or the liability at fair value,
shall not be treated as free reserves.
Punishment for contravention under Companies (Acceptance of Deposits) Rules, 2014–
If any company referred to in sub-section (2) of section 73 or any eligible company inviting deposits or any other person contravenes any provision of these rules for which no punishment is provided in the Act, the company and every officer of the company who is in default shall be punishable with fine which may extend to five thousand rupees and where the contravention is a continuing one, with a further fine which may extend to five hundred rupees for every day after the first day during which the contravention continues.
Penalty under Section 74(3) (Repayment of deposits, etc., accepted before commencement of this Act):-
If a company fails to repay the deposit or part thereof or any interest thereon within the time specified in sub-section (1) or such further time as may be allowed by the Tribunal under sub-section (2), the company shall, in addition to the payment of the amount of deposit or part thereof and the interest due, be punishable with fine which shall not be less than one crore rupees but which may extend to ten crore rupees and every officer of the company who is in default shall be punishable with imprisonment which may extend to seven years or with fine which shall not be less than twenty-five lakh rupees but which may extend to two crore rupees, or with both.
The overall provisions relating to deposits are much harder than the provisions of the previous Companies Act. The law maker have stringent the provisions keeping in view of the safety measures of the depositor and have made suffice provisions to get ensure the repayment of deposits taken either from members or from general public. The Corporate will have to thinks a lot to accept deposit from member/ public.
The author is of the view that the government, while making provisions, has overstepped to the enabling provisions to accept deposits and therefore has not left the space even to take breath. Under the present provisions, the backbone source of funding to the private sector even from members have been crushed by hit hammer by means of making provisions of Credit Rating, Deposit Insurance (See notification no. G.S.R. 386(E) dated 6th June, 2014) etc.. Under the present scenario, the Private Corporate world will prefer either to stop the business or to do the business merely by means of the status of “Partnership Firm” or “Proprietorship Concern”.
The author, therefore is of the view and request the government that it should reconsider the provisions and at least the acceptance of deposits from the members of the company be libraries.
Disclaimer: The entire contents of this document have been prepared on the basis of relevant provisions and as per the information existing at the time of the preparation. Though utmost efforts has made to provide authentic information, it is suggested to cross-check the relevant sections, rules under the Companies Act, 2013. The observations of the author are personal view and the author does not take responsibility of the same and this cannot be quoted before any authority.
(Author may be reached at singhalkap @ gmail.com)
(The post was first published on 11.05.2014 and republished with amendments on 09.08.2014.)