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What is the main objective of controlling companies which invite deposits?
What is the main objective of controlling companies which invite deposits?
- To reduce the regulations on accepting deposits
- To increase the number of companies accepting deposits
- To protect the interests of individuals offering deposits (correct)
- To maximize the profits of the corporate sector
Which section of the Companies Act deals with the prohibition on acceptance of deposits?
Which section of the Companies Act deals with the prohibition on acceptance of deposits?
- Section 76
- Section 76A
- Section 73 (correct)
- Section 74
What is the punishment for contravention of the provisions relating to acceptance of deposits by companies?
What is the punishment for contravention of the provisions relating to acceptance of deposits by companies?
- Section 73
- Section 76A (correct)
- Section 74
- Companies (Acceptance of Deposits) Rules, 2014
What concept does Chapter V of the Companies Act mainly address?
What concept does Chapter V of the Companies Act mainly address?
What does 'eligible companies' refer to in the context of accepting deposits from the public?
What does 'eligible companies' refer to in the context of accepting deposits from the public?
Which chapter of the Companies Act consists of sections 73 to 76A?
Which chapter of the Companies Act consists of sections 73 to 76A?
According to section 2 (31) of the Companies Act, 2013, the term 'deposit' includes which of the following?
According to section 2 (31) of the Companies Act, 2013, the term 'deposit' includes which of the following?
Which of the following is NOT a feature of the definition of 'deposit' as per section 2 (31) of the Companies Act, 2013?
Which of the following is NOT a feature of the definition of 'deposit' as per section 2 (31) of the Companies Act, 2013?
What types of deposits are explained in the given text?
What types of deposits are explained in the given text?
Which of the following is NOT considered as a deposit according to Rule 2 (1) (c)?
Which of the following is NOT considered as a deposit according to Rule 2 (1) (c)?
As per the Companies Act, 2013, who can accept deposits from its members only?
As per the Companies Act, 2013, who can accept deposits from its members only?
What is the maximum number of persons in joint names that can accept a deposit according to the Companies Act, 2013?
What is the maximum number of persons in joint names that can accept a deposit according to the Companies Act, 2013?
Which of the following entities can guarantee repayment and hence are not considered as deposit according to Rule 2 (1) (c)?
Which of the following entities can guarantee repayment and hence are not considered as deposit according to Rule 2 (1) (c)?
Which of the following is true about repayment of every deposit accepted by the company?
Which of the following is true about repayment of every deposit accepted by the company?
'Premature repayment' of a deposit can be made by which type of company?
'Premature repayment' of a deposit can be made by which type of company?
'Unsecured deposits' are explained as having what kind of security available?
'Unsecured deposits' are explained as having what kind of security available?
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Study Notes
Objective of Controlling Deposit-Inviting Companies
- To safeguard the interests of depositors and maintain financial stability within the market.
Prohibition on Acceptance of Deposits
- Section 73 of the Companies Act addresses the prohibition on accepting deposits from the public.
Punishment for Contraventions
- Companies contravening deposit acceptance provisions may face penalties, including fines or imprisonment for responsible officers.
Chapter V of the Companies Act
- Focuses primarily on the regulation of deposits and related provisions.
Eligible Companies
- Refers to companies that meet specific criteria outlined by the Companies Act for accepting deposits from the public.
Relevant Sections of the Companies Act
- Chapter V consists of sections 73 to 76A, governing the acceptance of deposits.
Definition of Deposit
- According to Section 2(31), the term 'deposit' includes money received by a company for a specified period with an assurance of repayment.
Features Excluded from Deposit Definition
- An advance or loan made by members is not classified as a deposit under the definition in Section 2(31).
Types of Deposits
- Various deposit types include secured, unsecured, and specific classifications related to the nature of the company and terms.
Exclusions from Deposit According to Rule 2(1)(c)
- Any advance payment made for the supply of goods or services that is refundable is not classified as a deposit.
Accepting Deposits from Members
- Only specific entities, such as private companies, can accept deposits solely from their members.
Maximum Number of Joint Depositors
- The Companies Act limits the maximum number of joint names for depositors to two.
Guaranteeing Entities
- Entities that provide a guarantee for repayment do not classify the funds as deposits under Rule 2(1)(c).
Repayment of Deposits
- Every company must ensure the timely repayment of deposits accepted, as per legal obligations.
Premature Repayment of Deposits
- Only companies that have adhered to specific regulations can offer premature repayment of deposits to their depositors.
Unsecured Deposits
- Unsecured deposits are characterized by the absence of collateral or security, meaning they carry a higher risk for the depositor.
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