*REQUIREMENTS OF SEC 74 & RULE 20*

*REQUIREMENTS OF SEC 74 & RULE 20*

*1)* *a)* As per sec 74 of Co Act, 2013 & Rule 20 of the Companies
(acceptance of deposit) Rules, 2014, *If deposit or any interest remains
unpaid on commencement of this Act**,* co. shall file, within 3 months
(i.e. 30th June, 2014), with ROC a statement in "Form DPT4"of all deposits
accepted & sums remaining unpaid and Co shall repay the dues on or before
31.03.2015 or on due date of repayment, whichever is earlier.

*b)* Tribunal may, on application made by co., allow further time to repay
the deposit.
*c) * *Penalties *-

 i)  To Company - shall pay deposit and interest along with fine Rs. 1
crore to Rs. 10 crores and

 ii) To officer in default - Imprisonment upto 7 years or fine Rs. 25 Lakhs
to Rs. 2 Crores, or both.

*YES,  LOAN CAN BE TREATED AS DEPOSITS*

*2)* Loan is covered under definition of deposits under Company Act, 2013
read with the Companies (acceptance of deposit) Rules, 2014.
*3)* Definition of the term "deposits" under Companies (acceptance of
deposit) Rules, 2014, states the following:

*a) *If loan is received from any other company by any co., it is not
covered as deposits.
*b) I*f loan is received by any company (both Public & Pvt) from directors,
it will not be covered as deposits provided director gives a declaration
that loan is out of own fund(not by taking loan) . However, if loan is
received from shareholders or director's relative by any Co, these will be
covered as deposits.
*c)* If loan is received from other individuals by any company (both Public
& Pvt), these will be covered as deposits.

*d) *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  will not be treated as deposits subject to
fulfillment of the following conditions, namely:-

(i) the loan is brought in pursuance of the stipulation imposed by the
lending institutions on the promoters to contribute such finance;

(ii) the loan is provided by the promoters themselves or by their relatives
or by both; and

(iii) the exemption under this sub-clause shall be available only till the
loans of financial institution or bank are repaid and not thereafter;

*4)* A question arises, if any loan is received by a Co. from shareholder
or director's relative under Co Act, 1956, should we include these as
deposit in Form DPT4 or not?
*Answer:* Yes, include these as deposits in Form DPT4.

*Reasons: *i) The meaning of the term "deposit" under sec 74 under Co Act,
2013 will be as per sec 2(34) of the Co Act, 2013. Hence, these will be
included as deposits in Form DPT4.
ii) The intention of introduction of sec 74 is to repay all old deposits
within one year time or extended time. MCA wants that all deposits accepted
have to follow new Act & New Rules.
iii) This view can also be supplemented by the fact that legislature is
giving enough time i.e. 1 year time to repay the deposits existing on 1st
April, 2014 to comply with new Act & New Rules.
iv) ROC is expected to take this view .