Debenture redemption reserve

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SREENATH P. (Querist)
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15 September 2016 Sir/madam,
I have a doubt on creation of Debenture redemption reserve.
For the NBFCs, Companies share capital and debenture rule says that adequacy of DRR will be 25% of the value of debentures issued through public issue.

My question is whether the term issued means outstanding debenture plus redeemed debenture?or the requirement is only for outstanding debenture?

Thanks in advance

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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15 September 2016 The requirement is only for outstanding debentures.

SREENATH P.

SREENATH P. (Querist)
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17 September 2016 Thank you

Is it enough to create DRR in a financial year for the amount will be redeemed in the follwing financial year?because some of the NBFCs following DRR Creation like this.Since there is no specific guideline by RBI on this,is it viable under Companies Act?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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17 September 2016 Reserve has to be created yearly.

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