Unsecured loan from relative of director

This query is : Resolved

ravinder (Querist)
Follow

17 February 2015 Dear sir,
our company has taken loans from relatives of director before the commencement of the act 2013 says Rs. 100000/-, whether the company has to file DPT-4 as per section 74 of the companies act?

Chetan Patankar

Chetan Patankar (Expert)
Follow

17 February 2015 No. However, renewal is not possible.
If you file DPT 4 ( was required to be file by the end of first quarter) then you will have to repay deposit by 31/03/15

ravinder

ravinder (Querist)
Follow

21 February 2015 thanks sir, but as per section 74 this amount covered under deposits as it is loan any circular regarding the same.

Aashok Kumar Sharma online

Aashok Kumar Sharma online

(Expert)
Follow

02 August 2025 You're asking whether a **loan taken from a relative of a director before the commencement of the Companies Act, 2013** (i.e., before **01-April-2014**) requires filing of **Form DPT-4** under **Section 74**, and whether it is treated as a deposit.

Let me clarify with explanation and reference:

---

### ✅ **Position under Section 74 of the Companies Act, 2013:**

Section 74 required companies to **file Form DPT-4** for any **outstanding deposits** accepted **before 01-April-2014**, which continued as deposits as per the **Companies (Acceptance of Deposits) Rules, 2014**.

---

### 💡 **Key Clarification:**

Loans from **relatives of directors** were **exempt** from being treated as “deposits” under **Companies Act, 1956**, and continued to be **exempt** under **Rule 2(1)(c)(viii)** of the **Companies (Acceptance of Deposits) Rules, 2014**, *provided a declaration was taken from the lender*.

Therefore:

> 🔸 **If the company had taken a loan from a relative of a director before 01-Apr-2014**,
> 🔸 **And it complied with the old exemption (under Companies Act, 1956)** —
> 🔸 **It was not required to file DPT-4**, **because it was not treated as a “deposit”** under the new rules either.

---

### 📌 MCA Clarification:

The **MCA General Circular No. 05/2015 dated 30.03.2015** also clarified the position of certain exempted deposits, including from relatives of directors, and further emphasized that:

> **Such amounts not treated as deposit under the new rules do not require filing of DPT-4.**

---

### 🟡 BUT: Important Caveat

* While **fresh loans from relatives of directors** are still exempt under certain conditions,
* **Renewal of old loans after 01-Apr-2014** (even from exempt sources) might **convert it into a “deposit”**, hence subject to **Section 73** and related compliance.

---

### ✅ Summary:

| Scenario | DPT-4 Required? | Reason |
| ------------------------------------------------- | --------------- | ---------------------------------------------- |
| Loan from relative of director before 01-Apr-2014 | ❌ No | Not considered deposit under new rules |
| Loan renewed/extended after 01-Apr-2014 | ✅ Yes | Treated as fresh deposit if conditions not met |
| No declaration from lender (relative) | ✅ Possibly | Might not qualify for exemption |

---

If you need a **draft declaration format** from the relative or a **sample board resolution**, I can help with that too.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Summarize this with AI

ChatGPT Perplexity Claude Google AI Grok

Similar Resolved Queries

Unanswered Queries

Popular
Recent

Trending Online Classes

Direct Tax Laws & International Taxation May 26,Sept 26 & Jan 27

CA Arvind Tuli

Enroll Now
Audit Fast Track Recorded Batch For May 26,Sept 26 & Jan 27

CA Aarti Lahoti

Enroll Now
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English

CA Bhanwar Borana & CA Shubham Keswani

Enroll Now

view all classess

Meet our CAclubindia PRO Members

Vimlesh kumar

Shivchandra Jakhotia

Dhananjay Singh

cgagroshg cgagroshg

vinal

Subscribe Now

Unsecured loan from relative of director

Similar Resolved Queries

Trending Online Classes

Meet our CAclubindia PRO Members

Quick Links

Browse by Category

Latest Job Openings

CA Final

Article Assistant

Accountant

GST CONSULTANCY

GST CONSULTANT