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Clarification on repayment of deposits accepted by companies before the commencement of Companies Act, 2013 under Section 74 of the said Act.

MCA on Saturday vide General Circular No. 9/2015 dated 18th June, 2015; with regards to the representations received by it, clarified the following:

Stakeholders asked clarity regarding processing of the deposits related complaints received from investors under
section 74 of the Companies Act, 2013 (the said Act) in respect of defaults made by companies in repayment of deposits accepted by them before the commencement of the said Act i.e. before lst April, 2014 and filing of
prosecutions against defaulting companies by the Registrars of Companies/Regional Directors.

MCA clarified that till the constitution of National Company Law Tribunal (NCLT) the above powers were given to the Company Law Board (CLB) & hence the depositors can file complaints & companies can file applications for extension of time for repayment of deposits accepted before the commencement of Companies Act, 2013 with the CLB.

MCA further stated that are per the provisions of the Explanation under Rule 19 of the Companies (Acceptance of Deposit) Rules, 2014 it is clarified that Companies can repay deposits accepted prior to 1st April, 2014 in accordance
with terms and conditions for which the deposits had been accepted.

It is also clarified that there is no bar on the Registrar of Companies for filing of prosecution against a company if such company fails to make repayment of deposits accepted by it under the provisions of the Companies Act, 1956 or Companies Act, 2013, subject to the contents of above para.

The said Circular can be accessed at the following link: General Circular No. 09/2015 dated 18th June, 2015

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