DPT-3 Return of Deposits

“Deposit” includes any receipt of money by way of deposit or loan or in any other form by a company, but does not include such categories of amount as may be prescribed in consultation with the Reserve Bank of India;”

Following Companies not covered under the provision of Deposits:

• Banking company;
• Non-Banking Financial Companies (NBFCs) as defined in the Reserve Bank of India Act1934 (2 of 1934) registered with the Reserve Bank of India;
• A company specified by the Central Government under the proviso to sub-section (1) of section 73 of the Act

• Provisions in respect to acceptance of deposits from members
  • Deposits can be accepted from persons, whose name appears on the Register of Members of the Company
  • The company should pass an ordinary resolution seeking authorization for acceptance of deposits;
  • Issuance of circular to members showing the financial position of the company, the credit ratings obtained, the total number of depositors and the amount due towards deposits in respect of any previous deposits accepted by the company and such other particulars in the Form DPT-1.
  • Filing a copy of the circular with the Registrar of Companies within 30 days before the date of issue of the circular;
  • Depositing, on or before the thirtieth day of April each year, such sum which shall not be lessthan twenty per cent. of the amount of its deposits maturing during the following financial year and kept in a scheduled bank in a separate bank account to be called deposit repayment reserve account
  • certifying that the company has not committed any default in the repayment of deposits accepted either before or after the commencement of this Act or payment of interest on such deposits and where a default had occurred, the company made good the default and a period of five years had lapsed since the date of making good the default
  • providing security, if any for the due repayment of the amount of deposit or the interest thereon including the creation of such charge on the property or assets of the company:
  • All the companies accepting deposits shall file the details of monies so accepted to the Registrar in Form DPT-3
  • No company shall accept or renew deposit whether, secured or unsecured, which is repayable on demand or upon receiving a notice within a period of less than 6 months or more than 36 months from the date of acceptance or renewal of such deposit.

However a company may for the purpose of meeting its short term requirements of funds accept or renew deposits whose repayment is before six months provided they do not exceed 10% of the aggregate of the paid up share capital, free reserves and securities premium account of the company and they are not repayable before 3 months from the date of deposits.

• Quantum of acceptance of deposit
  • Eligible companies can accept deposits from its members where the amount of deposits together with the amount of deposits outstanding as on the date of acceptance or renewal of such deposits is up to 10% of the paid-up share capital, free reserves and securities premium account.
    

    Where "Eligible Company" is the company which fulfilled all the following conditions:

    • Public company having a net worth of not less than one hundred crore rupees or Turnover of not less than five hundred crore rupees;
  • Other than eligible companies can accept deposits from its members where the amount of deposits together with the amount of deposits outstanding as on the date of acceptance or renewal of such deposits is up to 35% of the Paid-up share capital, free reserves and securities premium account.
    

    Provided that following private companies can accept deposits up to 100% of its paid-up share capital, free reserves and securities premium account if:

    • It is not an associate or subsidiary of any other company;
    • Borrowing of such company from banks or financial institution or body corporate is less than twice its paid-up share capital or ` 50 crores, whichever is less,
    • Such a company has not defaulted in repayment of money at the time of accepting deposit.
    • It is start up for ten years from the date of its incorporation.
    • IFSC public company and IFSC private company.

Note: Limit of paid up share capital, free reserve & Securities Premium should be calculated based on the last audited Financial Statements adopted by the members.

• Provisions in respect to acceptance of deposits from public
  • Complete prohibition on acceptance of “Deposits from public” by private limited Company.
  • Deposits from persons other than members can be accepted by "Eligible Companies" only.
  • "Eligible Company" is the company which fulfilled all the following conditions:
    •  Public company having a net worth of not less than one hundred crore rupees or Turnover of not less than five hundred crore rupees;
  • Has obtained the prior consent of the company in general meeting by means of a special resolution;
  • Filed the said resolution with the Registrar of Companies before making any invitation to the public for acceptance of deposits.
  • All the companies accepting deposits shall file the details of monies so accepted to the Registrar in Form DPT-3
  • No company shall accept or renew deposit whether, secured or unsecured, which is repayable on demand or upon receiving a notice within a period of less than 6 months or more than 36 months from the date of acceptance or renewal of such deposit.
    However a company may for the purpose of meeting its short term requirements of funds accept or renew deposits whose repayment is before six months provided they do not exceed 10% of the aggregate of the paid up share capital, free reserves and securities premium account of the company and they are not repayable before 3 months from the date of deposits.
• Quantum of acceptance of deposit:
  • In case of deposits from other persons (not being specifically to members):
    •  The proposed deposits including existing deposits (excluding deposits not accepted from members) are more than 25% Paid-up share capital, free Reserves and securities premium account.
    Therefore, in total an eligible Company can raise deposits up to 35% of the of Paid-up share capital, free Reserves and securities premium account.
    For Government eligible Company, it cannot accept or renew deposit when that proposed deposits including existing deposits are more than 35% Paid-up share capital, free Reserves and securities premium account.

• Ensure that the Circular which is to be issued for acceptance of deposits is sent either by electronic mail or registered post AD or by speed post to the members of the company only and not to public or other persons.
• Appoint Deposit Trustees for creating security for the secured deposits, if any by executing a Deposit Trust Deed in Form DPT-2 at least 7 days before issuing the Circular.
• Issue deposit receipts in the prescribed format and under the signature of an officer duly authorized by the Board within a period of twenty-one days from the date of receipt of money or realization of the cheque
• Make entries in the Register of Deposits within 7 days from the date of issuance of the deposit receipt and arrange to get such entries authenticated by a Director or Secretary of the Company or by any other officer authorized by the Board
• File the return of deposit in Form DPT-3 by furnishing the requisite information contained thereon as on 31st day of March each year duly audited by the Auditors before 30th June every year.