Filing of e-Form DPT-3 under the new Deposit Rules

CA Mohit Bhuteria

A.C. Bhuteria & Co.

Chartered Accountants

2 India Exchange Place

Kolkata – 700001

Mobile :9331026475

Meaning of “Deposits” under Section2(31) of the Companies Act, 2013

“Deposit" includes:

-any receipt of money

-by way of deposit or loan or in any other form by a company, butdoes not include such categories of amount as may be prescribedin consultation with the Reserve Bank of India.

Categories of transactions notconsidered as deposits:➢ any amount received from the Central Government/ State

Government/ Local authority/ statutory authority constituted underan Act of Parliament or a State Legislature, or from any other sourcewhose repayment is guaranteed by the Central Government / StateGovernment

➢ any amount received from foreign Governments, foreign orinternational banks, multilateral financial institutions foreignGovernments owned development financial institutions, foreignexport credit agencies, foreign collaborators, foreign bodiescorporate and foreign citizens, foreign authorities or personsresident outside India subject to the provisions of FEMA;

➢ any amount received as a loan or facility from any banking company;

➢ any amount received as a loan or financial assistance from PublicFinancial Institutions or Insurance Companies or Scheduled Banks;

➢ any amount received against issue of commercial paper or otherinstruments as per RBI guidelines;

Categories of transactions notconsidered as deposits:➢ any amount received by a company from any other company;

➢ any amount received and held towards subscription to any securities,including share application money or advance towards allotment ofsecurities pending allotment, unless in case where the security is notallotted within sixty days from the date of receipt or the amount idnot refunded to the subscribers within fifteen days from the date ofcompletion of sixty days [any adjustment of the amount for anyother purpose shall not be treated as refund]

➢ any amount received from a director of the company or a relativeof the director of the Private company, provided he/ she furnishesto the company at the time of giving the money, a declaration inwriting to the effect that the amount is not being given out of fundsacquired by him by borrowing or accepting loans or deposits fromothers and the company shall disclose the details of money soaccepted in the Board's report;

Categories of transactions notconsidered as deposits:➢ any amount received from an issue of bonds or debentures secured

by charge or convertible into shares within 10 years

➢ any amount received from an issue of bonds or debentures notsecured by charge or non-convertible and listed on the stockexchange

➢ any amount received from an employee of the company notexceeding the annual salary as a non-interest security deposit;

➢ any non-interest bearing amount received and held in trust;

➢ any amount received in the course of, or for the purposes of, thebusiness of the company,-

(a) as an advance for the supply of goods or provision of servicesaccounted for in any manner:

- to be appropriated against supply of goods or provision of serviceswithin a period of 365 days from the date of acceptance of suchadvance (other than which is subject matter of any legal proceedingsbefore any court of law):

Categories of transactions notconsidered as deposits:➢ any amount received in the course of, or for the purposes of, the

business of the company,-

(b) as advance received in connection with consideration for animmovable property under an agreement or arrangement , providedthat such advance is adjusted against such property in accordancewith the terms of agreement or arrangement;

(c) as security deposit for the performance of the contract for supplyof goods or provision of services;

(d) as advance received under long term projects for supply of capitalgoods;

(e) as advance for providing future services in the form of warrantyor maintenance contract as per written agreement, if the period forproviding such services does not exceed the period prevalent as percommon business practice or 5 years, whichever is less;

Categories of transactions not considered as deposits:➢ any amount received in the course of, or for the purposes of, the

business of the company,-

(f) as an advance received and as allowed by any sectoral regulatoror in accordance with directions of Central or State Government;

(g) as an advance for subscription towards publication, whether inprint or in electronic to be adjusted against receipt of suchpublications;

Provided that if the amount received under items (a), (b) and (d)above becomes refundable (with or without interest) due to thereasons that the company accepting the money does not havenecessary permission or approval, wherever required, to deal in thegoods or properties or services for which the money is taken, thenthe amount received shall be deemed to be a deposit under theserules:

Categories of transactions not considered as deposits:➢ any amount brought in by the promoters of the company by way

of unsecured loan in pursuance of the stipulation of any lendingfinancial institution or a bank subject to fulfillment of thefollowing conditions, namely:-

• the loan is brought in pursuance of the stipulation imposedby the lending institutions on the promoters to contributesuch finance;

• the loan is provided by the promoters themselves or by theirrelatives or by both; and

• the exemption under this sub-clause shall be available onlytill the loans of financial institution or bank are repaid andnot thereafter;

➢ any amount accepted by a Nidhi company;

Categories of transactions not considered as deposits:➢ any amount received by way of subscription in respect of a chit

under the Chit Fund Act, 1982 (40 of 1982);

➢ any amount received by the company under any collectiveinvestment scheme in compliance with regulations framed by theSecurities and Exchange Board of India;

➢ an amount of twenty five lakh rupees or more received by a start-upcompany, by way of a convertible note (convertible into equityshares or repayable within a period not exceeding five years fromthe date of issue) in a single tranche, from a person.

➢ any amount received by a company from Alternate InvestmentFunds, Domestic Venture Capital Funds, Infrastructure InvestmentTrusts, Real Estate Investment Trusts (included vide MCAnotification dated 22.01.2019) and Mutual Funds registered withthe SEBI in accordance with regulations made by it.

Companies (Acceptance of Deposits) Amendment Rules 2019

Notification: Notification Gsr. 42 [F.No.1/8/2013-cl-v] dated22-1-2019

Text of Amendment:

➢ Insertion of Explanation in Rule 16

"Explanation.—It is hereby clarified that Form DPT-3 shall beused for filing return of deposit or particulars of transactionnot considered as deposit or both by every company otherthan Government company.".

Companies (Acceptance of Deposits) Amendment Rules 2019

Text of Amendment:

➢ Insertion of Rule 16A(3)

“Every company other than Government company shall file aonetime return of outstanding receipt of money or loan by acompany but not considered as deposits, in terms of clause (c)of sub-rule 1 of rule 2 from the 01st April, 2014 to 31st March,2019, as specified in Form DPT-3 within ninety days from 31st

March, 2019 along with fee as provided in the Companies(Registration Offices and Fees) Rules, 2014."

Companies (Acceptance of Deposits) Amendment Rules 2019

Applicability: to every company other than a Governmentcompany

Note: Rule 1(3) of the Companies (Acceptance ofDeposits) Rules, 2014 do not apply to:

- a banking company

- an NBFC registered with the RBI

- a housing finance company

- a company specified by the Central Govt. underproviso to Section 73(1) of the Companies Act,

2013

Companies (Acceptance of Deposits) Amendment Rules 2019

Background:

➢ MCA had constituted a Committee to review the offencesunder the Companies Act, 2013, which issued its report inAugust 2018.

➢ The Committee noted that certain companies had misusedthe provisions relating to acceptance of deposits from thepublic. Since the definition of deposit under Rule 2(c) ofthe Companies (Acceptance of Deposits) Rules, 2014 excludescertain transactions from the ambit of 'deposits', certaintransactions go unreported.

➢ The Committee noted that some of the exclusions, such asthe one relating to the appropriation of advance for supply ofgoods and services within a period of 365 days are beingexploited for following dubious trade practices.

Companies (Acceptance of Deposits) Amendment Rules 2019

Background:

➢ The Committee further noted that during the assessment ofthe Basel Core Principles under the Financial SectorAssessment Programme (FSAP) of India, IMF hasrecommended that deposit taking by institutions that are notregulated as banks should be prohibited, notwithstanding avery small volume of such deposits.

➢ Based on this background, the Committee recommendedthat an e-Form where all companies (public or private) maybe required to provide the details of transactions which areexcluded from the purview of 'deposit's under the Rules.

Filing of e-form DPT-3

Form to be filed Particulars and due date

Annual return of deposit[Rule 16 & Expln.]

On or before 30th June of every year and furnish theinformation contained therein as on the 31st day ofMarch of that year duly audited by the auditor ofthe company.

One- time return ofoutstanding receipt of moneyor loan by a company but notconsidered as deposits (underRule 16A(3))

Within 90 days from March 31, 2019 for amountoutstanding for the period between April 1, 2014 toMarch 31, 2019 along with fee as provided in theCompanies (Registration Offices and Fees) Rules,2014;

THANK YOU