Hello Members
Plz advice;
A pvt company ( having paid up cap of 100000/-) wants to take deposit from another pvt company ( assume it to be the member since sec3 (1)(iii)(d) prohibits pvt company from taking deposits from public) of RS. 5 CRORES.
Please quote your views and my queries are;
1. Is this possible???
2. Any limits on acceptance of deposits??
3.Are the deposit rules applicable ?
4. if any body has agreement on the same , plz forward.
plz resond as early as possible.
Regards
Neeta.
Sec 372A on Intercorporate loans will be applicable on the company providing the loan.
I think the payee company have no legal compliances in respect of the loan...
Wud like to share my understanding on the issue;
ICD by a pvt company from another pVT compay is quite possible without the application of Section 58A or rules made thereunder.
Section 3(1)(iii)(d) though prohibits pvt company from accepting public deposits(ie from any person other than director/relative or member) , the Term deposit isn't defined and as per the definition of DEPOSIT in deposit rules 1975. Rule 2(b)(iv) exempts the amount taken by a one company from another being a DEPOSIT.
hence, a pvt company can take ICD without any monitory limits ( this means a pvt company with paid up cap of 1 lac can take deposit of 5 crores even)or restriction on the maturity period or rate of interest.
Kindly confirm
Also plz enlighten on the agreement to be entered into. Any format plz forward
thanks in anticipation
CAclubindia
