Whether a shareholder in a company can give loan to

the company.
Under Section 73 of the Companies Act, 2013 no public or private
company can accept a deposit from anybody without complying with
the provisions of Section 73.
Deposits as defined in Section 2(31) of the Companies Act,2013
includes receipt of money by loan.
Under Section 73(2) a company can accept deposits from its members
after passing of a resolution in general meeting and subject to the
Companies (Acceptance of Deposit) Rules, 2014. The company can
accept deposits on such term and conditions, including provision of
security, repayment with interest as agreed upon by the company and
its members.
Under Section 73(2) following conditions have to be fulfilled:
a.
Issuing a circular to its members including a statement showing
the financial position of the company, the credit rating obtained, the
total number of depositors and the amount due towards any
b. File a copy of the circular along with such statement with the
Registrar within thirty days before the date of issue of the circular;
c.
depositing such sum which shall not be less than fifteen per cent.
of the amount of its deposits maturing during a financial year and the
financial year next following, and kept in a scheduled bank in a
separate bank account to be called as deposit repayment reserve
account;
d. providing such deposit insurance in such manner and to such
extent as may be prescribed;
e.
certifying that the company has not committed any default in the
repayment of deposits accepted either before or after the
commencement of this Act or payment of interest on such deposits;
and
f.
providing security, if any for the due repayment of the amount of
deposit or the interest thereon including the creation of such charge on
the property or assets of the company:
If the company does not secure the deposits or secures them partially,
then the same shall be termed as unsecured deposits and shall be so
quoted in every circular, form, advertisement or any other related
document.

 Under the Companies (Acceptance of Deposits) Rules, 2014 any

amount received from a Director also any amount raised by the issue
of bonds or debentures secured by a first charge or a charge ranking
pari passu with the first charge on any assets referred to in Schedule III
of the Act excluding intangible assets of the company or bonds or
debentures compulsorily convertible into shares of the company within
five years is not included within the definition of a deposit [Rule 2(viii)
and (ix)]
Rules Regarding Acceptance of Deposits- Companies (Acceptance
of Deposit) Rules, 2014
The deposit should not be repayable on demand or on notice within a
period of less than six months or more than 36 months from the date of
acceptance of such deposit, however subject to the conditions in Rule
3(1) a company may accept a deposit for repayment earlier than six
months.
The deposits may be accepted in joint names not exceeding three (Rule
3(2))
The new deposits along with other deposits of the company should not
exceed 25 percent of the aggregate of the paid-up share capital and
free reserves of the company (Rule 3(3)).
For an eligible company the limit is 10 percent for deposits from
members. (Rule 3(4))
The rate of interest should not be more than the maximum rate of
interest or brokerage prescribed by the RBI for acceptance of deposits
by NBFC (Rule 3(6))
Atleast 30 days before issue of Circular/Form of Advertisement enter
into a contract providing for deposit insurance to cover both principal
and interest thereon Rule 5(1)
If the deposit amount is less than Rs. 25,000 the insurance coverage
will be full amount of the deposit if it is more than 25,000 then
minimum coverage cannot be less than 25,000. Rule 5(2)
Cost of insurance premium to be borne by the company Rule 5(3)
If the insurance contract becomes ineffective then the company shall
take fresh insurance coverage within 30 days. Rule 5(4)
The company if providing secured deposits shall provide for security by
way of a charge on its assets as referred to in Schedule III of the Act
excluding intangible assets and the market value of assets must be
assessed by a registered valuer. Rule 6(1)

 The total value of the security either by way of deposit insurance or by

way of charge or by both on companys assets shall not be less than
the amount of deposits accepted and the interest payable thereon.
Rule 6(1)
The security for deposits shall be created in favor of a trustee for
deposit holders. Rule 6(2)
Before issue of Circular/Form of Advertisement, the company should
appoint one or more deposit trustees for creating security for the
deposits. Rule 7(1)
The Company shall execute a deposit trst deed in form DPT-2 atleast 7
dayes before issuing the circular.
The trustee should satisfy the conditions under Rule 3(3)
No trustee should be removed after issue of circular/advertisement and
before the expiry of the term except with the consent of a;; the
directors present at a meeting of the board.
Rule 8 lays down the duties of a trustee and Rule 9 lays down the
procedure for calling a meeting of depositors
A company has to create a deposit repayment reserve account and
deposit a sum not less than 15% of the deposit amount matured during
the current financial year with any schedule bank. The amount shall not
be at any time fall below 15 percent of the amount of deposits
maturing until the current financial year and the next financial year.
Rule 13 (1)
The amount in deposit repayment reserve account shall not be utilized
for any other purpose other than for the repayment of deposits. Rule
13(2)
Under Rule 14, every company shall maintain at its registered office
one or more separate registers for deposits accepted and renewed with
the following particulars against each depositor
name, address and PAN of the depositor/s;
particulars of guardian, in case of a minor;
particulars of the nominee;
deposit receipt number;
date and the amount of each deposit;
duration of the deposit and the date on which each deposit is
repayable;
rate of interest or such deposits to be payable to the depositor;
due date for payment of interest;

 mandate and instructions for payment of interest and for nondeduction of tax at source, if any;
date or dates on which the payment of interest shall be made;
details of deposit insurance including extent of deposit insurance;
particulars of security or charge created for repayment of deposits;
any other relevant particulars;
File a deposit return in Form no.3 by furnishing information therein as
on 31st March duly audited by auditors before 30th June of every year.
Rule 16