Maximum limit

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Fenil Shah (Querist)
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07 July 2011 What is the maximum limit that a listed company can accept as deposits from public including shareholders and directors???

Guest

Guest (Expert)

07 July 2011 It is 30% of Paid-up capital and Free reserve

Saroja

Saroja (Expert)
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08 July 2011 can u tell me which section deals with this

Fenil Shah

Fenil Shah (Querist)
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11 July 2011 Sir isn't it 35% (10% + 25%)
it is sec 58A

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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03 August 2024 The regulation of public deposits by companies is primarily governed by the **Companies Act, 2013**, and the relevant provisions have been updated from the earlier Companies Act, 1956.

### **Maximum Limit for Public Deposits**

Under the Companies Act, 2013, and the **Companies (Acceptance of Deposits) Rules, 2014**, the following limits and conditions apply to the acceptance of deposits by companies:

#### **For Public Companies:**
1. **Maximum Amount:**
- A public company can accept deposits up to **25% of its paid-up share capital, free reserves, and securities premium account**.

2. **For Private Companies:**
- The rules for private companies differ, and they can accept deposits from their members (shareholders) up to **100% of their paid-up share capital**.

#### **Under Section 58A:**
Section 58A of the Companies Act, 1956, which was relevant before the Companies Act, 2013, specified that companies could accept deposits up to **25% of the paid-up share capital and free reserves**. This provision is now superseded by the Companies Act, 2013.

#### **Revised Limits:**
1. **For Listed Companies:**
- **Section 73 of the Companies Act, 2013:** Allows listed companies to accept deposits from the public up to 25% of their paid-up share capital and reserves. This limit applies to deposits from the general public and is subject to conditions and guidelines prescribed by the Securities and Exchange Board of India (SEBI).

2. **For Unlisted Companies:**
- **Section 73 of the Companies Act, 2013:** Unlisted public companies can accept deposits from the public up to 25% of their paid-up share capital and free reserves, while private companies can accept deposits from their members up to 100% of their paid-up share capital.

### **Additional Conditions:**
- Deposits from directors and shareholders are also regulated, and specific rules govern such acceptance to ensure compliance with the legal framework.

### **Example:**
If a listed company has a paid-up share capital of ₹10 crore and free reserves of ₹5 crore:
- **Maximum Deposits Acceptable:** ₹15 crore (25% of ₹15 crore = ₹3.75 crore).

### **Summary:**
- **Public Companies:** Up to 25% of paid-up capital and reserves.
- **Private Companies:** Up to 100% of paid-up capital from members.
- **Listed Companies:** Governed under Section 73 of the Companies Act, 2013.

Always check the latest legal provisions and guidelines issued by the Ministry of Corporate Affairs (MCA) or consult a legal expert for up-to-date and specific advice.

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