Deposit rule 2 (1) (c)

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Rahul Malhotra (Querist)

07 February 2015 Point No viii of Rule 2 (1) (c) of Deposit rule says that any amount received from a person who, at the time of receipt of the amount, was a director of the Company.

Provide that the director from whom the Money is received, furnish to the Company at the time of giving the money, a declaration in writing to the effect that the amount is not being given out of fund acquired by him by borrowing or accepting loans or deposit from others.

My question is X Company is receiving application money for further allotment and Mr. A is the Director or Member in the X company. So at the time of giving application money the director shall furnish the declaration in writing or not as per proviso of above mention point.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

07 February 2015 No. Because the proviso is for 'deposit' and not for 'share subscription money'.

Rahul Malhotra

Rahul Malhotra (Querist)

07 February 2015 Yes sir i agree it is for deposit.
but if i borrow money and invest that money as a share capital in the company. then that will be cover under deposit or not

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