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unsecured loans taken by the company

GOPAL KUMAR AGRAWAL (PARTNER) (205 Points)

13 June 2009

If the Company has accept the Deposits from the non corporate ( Individual) without giving the advertisement in the news paper in that case the deposit received by the Company it will attract u/s 58A & u/s 58 AA of the Companies Act ,1956. If it will not attract the u/s 58 A& u/s 58 AA of the Companies on what ground please send me in details.

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6 Replies

CA CS Bhumika Thakkar (CA,CS) (1618 Points)
Replied 13 June 2009

pvt. co. can accept..

n public co. if it has issued a statement in lieu of prospectus..

Anuraag Sharma (Sr Executive Finance) (845 Points)
Replied 17 June 2009

a private company can accept such deposits...

but in case of a pubilc copany where it intends to accept deposits without inviting such deposits, it shall be required to file with Registrar a statement called "Statement in Lieu of Advertisement". The staement shall contain all particulars required to be included in the advertisement and sahll be signed in the same manner as the advertisement for deposits.

It is similar to that iof staement in lieu of prospectus but you can't call "Statement in Lieu of Advertisement" as statement in lieu of prospectus...:)!!!

1 Like

Ankit (NA) (38 Points)
Replied 17 June 2009

Originally posted by :Anuraag Sharma
"	a private company can accept such deposits... but in case of a pubilc copany where it intends to accept deposits without inviting such deposits, it shall be required to file with Registrar a statement called "Statement in Lieu of Advertisement". The staement shall contain all particulars required to be included in the advertisement and sahll be signed in the same manner as the advertisement for deposits. It is similar to that iof staement in lieu of prospectus but you can't call "Statement in Lieu of Advertisement" as statement in lieu of prospectus...:)!!!	"

I agree

seshadri (salaried) (64 Points)
Replied 20 June 2009

In my view, private limited can accept deposits from members and directors only.

and public limited company has to comply with SEc 58 A

RAJU (LEARNER) (1089 Points)
Replied 22 June 2009

In addition the answers given above, a company can accept deposit from other company etc.,

Find below the link to Companies (Acceptance of Deposits) Rules which contains an exclusive definition w.r.t deposits;

https://www.mca.gov.in/MinistryWebsite/dca/actsbills/rules/CAoDR1975.pdf

Yogesh (Manager) (50 Points)
Replied 05 July 2009

Section 3(1)(iii)(c) of the Companies Act 1956, prohibits private compnay any invitation or acceptance of deposits from persons other than its members, directors or their relatives. Section 58A of the Companies Act read with Acceptance of Deposit rules, defines deposits which includes borrowings also. Clauses 2 of acceptance of deposit rules exempts various deposits to compliance of section 58A and acceptance of deposit rules. As per said clause borrowings from individuals, other than directors and relatives are not exempted, hence private compnay caanot borrow funds from individuals. For detail refere section 58A and acceptance of deposits rules.