Rely only on official gazette rules & not on mca website!

I have been advising to rely on  Rules published in Official Gazette only.  Here is another example of difference in the two versions:

 

Rule 18(7)(b) under Chapter IV – Companies (Share Capital & Debentures) Rules 2014

 

As per Rules on MCA website:

 

“(b) the company shall create Debenture Redemption Reserve equivalent to at least fifty percent of the amount raised through the debenture issue before debenture redemption commences.”

 

As per Official Gazette published now:

 

“(b) the company shall create Debenture Redemption Reserve (DRR) in accordance with following

conditions:-

 

(i) No DRR is required for debentures issued by All India Financial Institutions (AIFIs) regulated

by Reserve Bank of India and Banking Companies for both public as well as privately placed

debentures. For other Financial Institutions (FIs) within the meaning of clause (72) of section

2 of the Companies Act, 2013, DRR will be as applicable to NBFCs registered with RBI.

 

(ii) For NBFCs registered with the RBI under Section 45-IA of the RBI (Amendment) Act, 1997,

‘the adequacy’ of DRR will be 25% of the value of debentures issued through public issue as

per present SEBI (Issue and Listing of Debt Securities) Regulations, 2008, and no DRR is

required in the case of privately placed debentures.

 

(iii) For other companies including manufacturing and infrastructure companies, the adequacy of

DRR will be 25% of the value of debentures issued through public issue as per present SEBI

(Issue and Listing of Debt Securities), Regulations 2008 and also 25% DRR is required in the

case of privately placed debentures by listed companies. For unlisted companies issuing

debentures on private placement basis, the DRR will be 25% of the value of debentures.”

Replies (1)

great information sir.

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