Public Deposits - Acceptance of ‑ Scope and provision of Companies (Acceptance of Deposits) Rules, 1975 - Companies Law - Letter : No. l/101/75‑CL‑XIV,

Letter : No. l/101/75 CL XIV, dated 21 10 1976. Subject:- Public Deposits - Acceptance of Scope and provision of Companies (Acceptance of Deposits) Rules, 1975 explained Rule 2(b)(ix) : WHETHER PRIVATE COMPANY, WHICH ACCEPTS DEPOSITS ONLY FROM ITS DIRECTORS AND SHAREHOLDERS, IS REQUIRED TO COMPLY WITH RULE 3 Query : As per rule 2(b)(ix), any amount received from a person who, at the time of receipt of the amount, was a director of the company or any amount received by a private company from its shareholders, shall not be treated as deposits for the purpose of section 58A. In view of doubts as to the exact scope and application of rule 3(2)(i), it may be clarified as to whether a private company which accepts deposits only from its directors and shareholders would have to comply with the limit of 15 per cent laid down in rule 3. Answer : The amounts received by a private company from its directors and shareholders are not deposits within the meaning of rule 2(b)(ix) and hence, not subject to the limits specified in rule 3.