No penal interest applicable on amount given prior to 1st April 2014 for share allotment

Nitin Rekhan Vs Union of India & Ors. (Delhi High Court) Held that as per Rule 2(b)(vii) of Companies (Acceptance of Deposits) Rules, 1975 read with General Circular No. 15/2015, the share application money given by the Petitioner for allotment of shares cannot be treated as “deposits”. Hence, penal interest not available to the petitioner. Facts- The Petitioner had paid Rs. 40,00,000/- to the Directors of Respondent Company for issuance of shares in the said company on 27th December 2010. The Respondent Company failed to allot the shares as promised and returned the money on 9th Febru...