Public Deposits - Acceptance of ‑ Scope and provision of Companies (Acceptance of Deposits) Rules, 1975 - Companies Law - Circular : No. 5

Circular : No. 5 [4/3/76 ‑ CL ‑XIV and 1/1/76 ‑ CL ‑ V], dated 10 ‑ 3 ‑ 1976. Subject:- Public Deposits - Acceptance of ‑ Scope and provision of Companies (Acceptance of Deposits) Rules, 1975 explained Rule 4(1) : REQUIREMENT OF ADVERTISEMENT FOR INVITING DEPOSITS Rule 4 requires every company, intending to invite or allowing or causing any other person to invite deposits to issue an advertisement for the purpose. A question has been raised as to whether an intimation to a depositor on the eve of maturity of his deposit indicating the date of maturity coupled with a statement that the depositor may renew his deposit if deemed necessary would amount to an invitation and hence call for issue of an advertisement. This Department has considered the matter and is of the view that such an intimation would amount to an invitation and hence the company should comply with the requirements of sub‑rule (1) of rule 4. In short, there must be a valid advertisement in force which would permit such an invitation.