MCA vide Notification no. G.S.R. 548 dated 7th September, 2020, notified Co (Acceptance of Deposits) Amendment Rules, 2020 with the following changes in Co (Acceptance of Deposits) Amendment Rules, 2014:-
- In rule 2, in sub-rule (1), in clause (c), in sub-clause (xvii), an amount of twenty five lakh rupees or more received by a start-up company, by way of a convertible note in a single tranche, from a person is not considered deposit where the convertible note should be redeemed in max 5years is amended to 10 years.
- In the Explanation, in clause I, for the reference to “G.S.R. 180 (E) dated 17th February, 2016 issued by the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry”, the following reference – “G.S.R. 127 (E), dated the 19th February, 2019 issued by the Department for Promotion of Industry and Internal Trade” is substituted.
- In rule 3, in sub-rule (3), in the second proviso,the maximum limit in respect of deposits to be accepted from members does not apply to certain private companies: -In clause (i), a private company which is a start-up, for five years is amended to ten years from the date of its incorporation.
The said Notification can be accessed through the following link: MCA_Notif_GSR.548(E)_07.09.2020_Co(Acceptance of Deposits) Amendment Rules, 2020.