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Loan Received by private companies from members, directors or their relatives before 01.04.2014 is not deposit

Stakeholders have sought clarifications as to whether amounts received by private companies from their members, directors or their relatives prior to 1st April, 2014 shall be considered as deposits under the Companies Act, 2013 as such amounts were not treated as 'deposits' under section 58A of the Companies Act, 1956 and rules made thereunder.

General Circular No. 05/2015

Dated: 30th March, 2015

To

All Regional Directors,

All Registrars of Companies, All stakeholders.

Subject: Amounts received by private companies from their members, directors or their relatives before 1st April, 2014 – Clarification regarding applicability of Companies (Acceptance of Deposits) Rules, 2014

Sir,

Stakeholders have sought clarifications as to whether amounts received by private companies from their members, directors or their relatives prior to 1st April, 2014 shall be considered as deposits under the Companies Act, 2013 as such amounts were not treated as ‘deposits’ under section 58A of the Companies Act, 1956 and rules made thereunder.

2.The matter has been examined in consultation with RBI and it is clarified that such amounts received by private companies prior to 1st April, 2014 shall not be treated as ‘deposits’ under the Companies Act, 2013 and Companies (Acceptance of Deposits) Rules, 2014 subject to the condition that relevant private company shall disclose, in the notes to its financial statement for the financial year commencing on or after 1st April, 2014 the figure of such amounts and the accounting head in which such amounts have been shown in the financial statement.

3. Any renewal or acceptance of fresh deposits on or after 1st April, 2014 shall, however, be in accordance with the provisions of Companies Act, 2013 and rules made thereunder.

4.This issues with the approval of the competent authority.

F. No. 1/8/2013-CL-V

Yours faithfully,

(K.M.S. Narayanan)

Assistant Director (Policy)

Categories: Company Law

View Comments (8)

  • Dear Sir
    What Does means

    "3. Any renewal or acceptance of fresh deposits on or after 1st April, 2014 shall, however, be in accordance with the provisions of Companies Act, 2013 and rules made thereunder."

    Is it mean that amount accepted after 01/04/2015 will be treated as deposit?

  • It's a cheating, I followed all the norms and cleared all the deposits before 31st March, now it's a really big trouble for me to rum my business. It is beneficial for only those who didn't followed the rules and did not cleared their deposits and kept that with them. Government is giving benefit to those who does not follow the rules.. Feeling ashamed for such a dirty politics in laws also

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