Ekta (Practicing CS) (423 Points)
02 July 2009Dear All,
I have one very big confusion about Section 58 A of Companies Act, 1956. is this section apply to Public Companies only?? and if deposits accepted from Corporate Sectors or companies by a Private Limited Company then is it violation of this rule?? and are the companies from which the deposits are accepted are covered in deposits from Public in case of Private Companies???
Ajay Mishra
(Company Secretary)
(74337 Points)
Replied 02 July 2009
Dear Ms. Ekta
Definition of private company as given under Section 3(1) (iii)(d) prohibit any invitation or acceptance of deposits from persons other than its members, directors or their relatives.
Best Regards
RAJU
(LEARNER)
(1089 Points)
Replied 02 July 2009
Hi,
1) Section 58A is applicable to Public as well as Private Companies,
2) Deposits accepted by a company from another company is outside the purview as the definition of `deposit` excludes it.
3) I didn't get this.
P C Agrawal
(Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad)
(8229 Points)
Replied 02 July 2009
Pl refer to Rule 2(b)(iv) of Companies (Acceptance of Deposits) Rules 1975 which excludes inter-company deposits from the definition of deposits.
Thanks
MAYANK GUGLANI
(CA )
(124 Points)
Replied 02 July 2009
I THINK SECTION 58A ALSO APPLIES TO PRIVATE COMPANIES
ONLY VIOLATION TO THIS SECTION IS FOR BANKUNG COMPANIES AND OTHER COMPANIES WHERE CG WITH CONSULTATION WITH RBI...
Ekta
(Practicing CS)
(423 Points)
Replied 02 July 2009
Thank you all for the reply, I get the point.
CS Ankur Srivastava
(Company Secretary & Compliance Officer)
(17853 Points)
Replied 03 July 2009
Section 58A applies to both Private as well as Public Companies. However in case of Private Companies deposit may only be accepted from its members, directors or their relatives.
Intercorporate deposits are not treated as deposit in terms of Rule 2(b)(iv).
CAclubindia
