The Ministry of Corporate Affairs (“MCA”) vide a clarification dated 18 June 2015 has stipulated that in cases where a company has committed default in repayment of deposits which were accepted by such company before the commencement of the Companies Act, 2013 (the “Act”) (i.e. 1 April 2014), the depositors may seek remedy by filing an application (in accordance with section 73 (4) of the Act) with the Company Law Board.
An application seeking an extension to repay such deposits (accepted by the company prior to the commencement of the Act) may be made to the Company Law Board under section 74(2) of the Act.
The MCA has highlighted the explanation to Rule 19 of the Companies (Acceptance of Deposits) Rules 2014 as a point of reference in this regard as it outlines the conditions subject to which a company will be deemed to have complied with the requirements of section 74(1)(b) of the Act.
The Registrar of Companies may initiate prosecution against a company if it fails to repay deposits accepted by it under the provisions of the Companies Act, 1956 or the Act, as the case may be.