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Deposits from directors

Corporate & Other Laws

If a private company cannot collect deposits from a director according to Acceptance of Deposits of Companies Rule, 2014 unless the director uses 3rd party's funds And there are no declarations , how can a company accept deposits with no limit as long as a declaration signed by the director is given(Rule 3)?

Sowmiya Paranan

CA Inter

★ 0

10-Jun-20 11:30

345

Answers (1)

Money from directors or relatives of directors does not come under definitions of deposits for the purpose of Sec 73, thus rule 3 does not affect monies received by the director. But, the condition for such exclusion is also given in sec 2(31) that defines deposits.