[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINAR! PART II,SECT|ON t, suB_SECTION (i) |

Uovcrnment of IndidMinistry of Corporate Affairs

Notilication

New Delhi, dated, the 29t June,2016G.S.R. _ (E). - In exercise of the powers conferrecl by sections 73 and Z6 reacl with sub_

section (1) of section 469 of the Companies Act, 2013 (1g of 20-13), the Centual

Government hereby makes the following rules further to amend the Companies

(Acceptance of Deposits) Rules, 2014, namely:_ (1) These rules may be called the

Companies (Acceptance of Deposits) Amendment Rules, 2016.

(2) They shatl come into force on the date of theii publication in the Official Gazette.

2. ln thc Companies (Acceptance of Deposits) Rutes, 2014 (hereinafter rerered to as the

principal rules), in rule ] in sub_rule (1), in clause (c),_

(i) in sub-clause (ix), for the words,,five years,,the words,,ten years,,shall be

substituted;

(ii) after sub-clause (ix), the following sub_clause shall be inserted, namely,_

"(ixa) any amount raised by issuc of non_convertible debenture not constltuting a

charge on the assets of the company and listed on a recognised stock exchange as p€r

applicable regulations made by Securities and Exchange Board of India_,,,

(iii) for sub-clause (xi), the following sub.clause shall be subshtuted, namely:_

"(xi) any non-interest beadng amount received and held in trust;";

(iv) in sub-clause (xii),-

(A) after item (d) and before the proviso, the following items shall be inserted,

namely:-

"(e) as an advance towards consideration for providing future services

in the form of a warranty or maintenance contract as per written agreement or

arangement, if the period for providing such services does not exceed the period

prevalent as per common business practice or five years, from the date of

acccptancc of such service whichever is less;

(Q as an advance received and as allowed by any sectoral regulator

or in accordance with directions of Central or State Government;

(g) as an advance for subscription towards publication, whether in

p(int or in electronic to be adjusted against receipt of such publications; ".

(B) in the Explanation, the words "refelled to in the proviso" shall be omittcd;

(v) in the Explanation, aftcr sub-clause (xiv), for the words "shall be treated as

deposits", thc words "shall be considered as deposits unless specifically excluded under

this clause" shall be substituted;

(vi) after sub-clause (xiv), the following sub-clauses shall be inserted, namely:-

(xv) any amount received by way of subscription in respect of a chit under

the Chit Fund Act,1982 (40 of "1982\;

2

(xvi) any amount received by the company undcr any collective investmcnt

schcmc in compliancc with rcgulations framed by thc Sccuritics and

Erch.rng,e Boa rtJ of India,

(xvii) an amount of twenty five lakh rupces or more received by a start-up

company, by way of a convcrtiblc notc (convcrtiblc into equity sharcs or

repayablc within a pcriod not exceeding five years from the date of issue) in

a single tranche, from a pcrson.

Explanation.- For the purposes of this sub<lausc',-

L "start-up company" mcans a privatc company incorporated under the

Companics Act, 2013 or Conrpanics Act, 1956 and rccogniscd as such in accordance

with notificatiorl nunrbcr C.S.R. 180(E) datcd 17'h Fcbr'rary, 2016 issuecl by the

Dcpartmcnt of Industrial Policy and Pr('motion, Ministry of Commerce and lndustry;

II. "convcrtiblc notd' mcans an instrumL'nt evidencing receipt of moncy initially as a

debt, which is rcpayable at thc opti(r'r of drc holder, or which is convertiblc into such

number of equity shares of the start-up company upon occurrence of specificd cvcnts

and as per the other terms and conditions agreed to and indicatcd in thc instrument.

(xviii) any amount rcccived by a company from Alternate Investmcnt Funds,

Domestic Vcnture Capital Funds and Mutual Funds rcgistcred with the Securitics and

Exchangc Board of Inclia in accordance with rcgulations made by it.".

3. In Rulc 3 of thc Principal rulcs,-

(i) in sub-rule (3),-

(a) for the words "twenty five per cent.,,, the words,,thirty five per cent.,,

shall be substituted;

(b) the following proviso shall be inserted namely:

"Provided that a private company may accept from its members monies

not exceeding one hundred per cent of aggregate of the paid up share

capital, free reserves and securities premium account and such company

shall file the details of monies so accepted to the Registrar in such manner

as may be specified.".

(ii) for sub-rule (8), the following sub-rule shall be substituted, namely:_

"(8).- (a) Every eligible company shall obtairy at least once in a year, credit

rating for deposits accepted by it and a copy of the rating shall be sent to the

Rcgistrar of Companies alongwith the retum of deposits in Form DpT_3,

(b) The credit rating referred to in clause (a) shall not be below the mlntmum

investment grade rating or other specified credit rating Ior fixed deposits, from

any one of the approved credit rating agencies as specified for Non_Banking

Financial Companies in the Non-Banking Financial Companies Acceptance of

Public Deposits (Reserve Bank) Directions, 199g, issued by the Reserve Bank of

India, as amended from time to tim€ ,,

4. in rule 4 of the principal rules, for sub-rule (2), the following sub-rule shall be

substituted, namely:-

" (2) Every eligible company intending to invite deposits shall issue a circular in

the form of an advertisement in form DPT-1 for the purpose in English language

in an English newspaper having country wide circulation and in vetnacular

language in a vernacular newspaper having wide circulation in the State in which

the registered office of the company is situated, and shall also place such circular

on the website of the company, if any.".

5. in rule 5 of the principal rules, in sub-rule (1), for the proviso, the following proviso

shall be substituted, namely:-

"Providetl that the companies may

contract till the 31s March, 2017 or

product, whichever is earlier.".

accept deposits without deposit insurance

till the availability of a deposit insurance

6. after rule 16 of the principal rulcs, thc following rule shall be inserted, namely:-

"16A. Disclosures in the financial statement.- (1) Every company, other than a

private company, shall disclose in its financial statement, by way of notes, about

the money received from the director.

(2) Every private cornpany shall disclose in its financial statement, by way of

notes, about the money received from the directors, or relatives of directors.".

7. in the principal rulet in the Annexure, in Form DPT-I, the following para shall be

inserted, namely:-

"6. DISCLAIMER.- It is to be distinctly understood that filing of circular or

circular in the Form of advertisement with the Regishar should not in any way

be deemed or construed that the same has been cleared or approved by the

Registrar or Central Government. The Registrar or Central Governrnent does not

take any responsibility either for the financial soundness of any deposit scheme

Ior which the deposit is being accepted or invited or for the corectness of the

statements made or opinions expressed in the circular or circular in the Form of

advertisement. The depositors should exercise due diligence before investing in

the deposits schemes.".

Note. - The principal rules were published in the Gazette of India, Extraordinary, part

II, Section 3, sub-section (i) aide number G.S.R. 256(E), dated the 31"r March,2014 and

subsequently amended vide number G.S.R.386(E), dated the 6h June,2014, c.S.R-

241(E), dated the 31s' March, 2015 and G.S.R. 695(E), dated the lsrn September, 2015_

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