Public Deposits - Acceptance of ‑ Scope and provision of Companies (Acceptance of Deposits) Rules, 1975 explained - Companies Law - Letter : No. 4/26/79-CL-X,

Letter : No. 4/26/79-CL-X, dated 20-2-1981. Subject:- Public Deposits - Acceptance of ‑ Scope and provision of Companies (Acceptance of Deposits) Rules, 1975 explained Rule 4(2) : ANNOUNCEMENT ABOUT ALTERATIONS IN TERMS AND CONDITIONS OF DEPOSITS ‑ WHETHER AMOUNTS TO INVITATION OF DEPOSITS WHETHER IN CONFORMITY WITH SECTION 58A(2) READ WITH RULE 4(2) Notice/advertisement notifying merely alterations in the terms and conditions of deposits including change in the rates of interest from a particular date is an amendment to the statutory advertisement issued earlier and does not require to be in form prescribed in rule 4(2). While making announcement about alteration in the terms and conditions including the change in the rates of interest on deposits, if the company, inter alia, invites deposits by indicating, for example, that deposits were continued to be accepted, that the higher rates would be applicable in case the existing deposits were renewed or in case fresh deposits were made that necessary application forms for accepting deposits were available with the company and/or its agents and so on, such announcement tantamounts to invitation of deposits and require advertisement in the form prescribed in rule 4(2), failing which the advertisement is construed to be not in conformity with the provisions of section 58A(2) and penal provisions of section 58A(6)(a)(ii) read with section 58A(6)(b) become attracted.