Bank-Stipulated Promoter Infusion Falls Outside Deposit Regime, Repayment Claim Dismissed: NCLT

Bank-Stipulated Promoter Infusion Falls Outside Deposit Regime, Repayment Claim Dismissed: NCLT

Introduction

The Mumbai Bench of the National Company Law Tribunal (NCLT) examined whether monies infused by a shareholder-promoter pursuant to a bank’s lending stipulation could be treated as “deposits” under the Companies Act, 2013. The Tribunal also considered whether a petition seeking repayment under Sections 73(4) and 76(2) of the Companies Act was barred by limitation. The ruling clarifies the scope of statutory exclusions under the Companies (Acceptance of Deposits) Rules, 2014 and reinforces that deposit provisions cannot be used as a recovery mechanism for time-barred or disputed claims.

Factual Background

Anusmera Realty and Infra Pvt. Ltd. had availed term loan facilities from Saraswat Bank, which imposed specific conditions requiring subordination of unsecured loans amounting to Rs. 750 lakhs. In compliance with this stipulation, promoters infused funds into the company by way of unsecured loans. Vimla Thakarashi Dedhia, who was also a shareholder of the company since 2013–14, later sought repayment of these amounts, alleging that they constituted “deposits” under the Companies Act, 2013.

The respondent initiated Company Petition No. 412 of 2021 under Sections 73(4) and 76(2) of the Act, asserting default in repayment.

Procedural Background

The applicant company filed Company Application No. 370 of 2022 under Rule 11 of the NCLT Rules, 2016, challenging the maintainability of the company petition. The application sought dismissal of the petition on the grounds that the amounts in question were not “deposits” in law and that the petition was barred by limitation. The respondent did not file a written reply to the application and relied on oral submissions.

Issues

1. Whether the amounts infused by the respondent constitute “deposits” under the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

2. Whether the company petition filed under Sections 73(4) and 76(2) of the Companies Act, 2013 is barred by limitation.

Contentions of the Parties

Applicant’s Contentions: The applicant contended that Sections 73 and 76 of the Companies Act govern only the acceptance and repayment of deposits and are inapplicable where the amounts are not deposits in law. It was argued that the respondent, being a shareholder, could not invoke these provisions, particularly when no invitation or statutory compliance for acceptance of deposits had ever been undertaken.

It was further submitted that the funds were infused solely pursuant to a mandatory stipulation imposed by Saraswat Bank and therefore fell squarely within the statutory exclusion under Rule 2(1)(c)(xiii) of the Companies (Acceptance of Deposits) Rules, 2014. The applicant also argued that the petition was barred by limitation, as the transactions pertained to 2015 or earlier, while the petition was filed only in 2021, beyond the three-year limitation period prescribed under Section 433 of the Companies Act read with Article 113 of the Limitation Act, 1963.

Respondent’s Contentions: The respondent argued that the company had failed to comply with mandatory requirements under Section 73(2) of the Companies Act, including issuance of circulars, filing with the Registrar of Companies, creation of a deposit repayment reserve and deposit insurance. According to the respondent, such non-compliance rendered the acceptance of monies illegal, thereby entitling her to invoke Sections 73(4) and 76(2) for repayment.

Reasoning and Analysis

The bench of Shri Mohan Prasad Tiwari (Judicial Member) and Shri Charanjeet Singh Gulati (Technical Member) first examined the statutory framework governing “deposits” under Section 2(31) of the Companies Act, 2013, read with the Companies (Acceptance of Deposits) Rules, 2014. It noted that Rule 2(1)(c)(xiii) expressly excludes from the definition of “deposit” any amount brought in by promoters by way of unsecured loan pursuant to a stipulation imposed by a lending bank, subject to fulfillment of prescribed conditions.

Upon perusal of the Saraswat Bank sanction letters, the Tribunal found that the infusion of unsecured funds by promoters was a clear pre-condition imposed by the bank. The expression “brought in” under the Rules was held to be of wide amplitude, covering such promoter infusions made to satisfy lending requirements. Once the stipulation by the bank was established, the statutory exclusion operated automatically.

The Tribunal held that once the transaction fell within this exclusion, the amount could not be treated as a “deposit” under Section 2(31). Consequently, Sections 73 and 76 of the Companies Act were rendered inapplicable, and their invocation was legally unsustainable.

On limitation, the Tribunal observed that Section 433 of the Companies Act makes the Limitation Act applicable to proceedings before the NCLT. In the absence of a specific limitation period under Section 73(4), Article 113 of the Limitation Act applied, prescribing a three-year period from the date when the right to sue accrued. The alleged transactions having taken place prior to 2015 and the petition having been filed in 2021, the claim was held to be ex facie time-barred. The Tribunal found no pleading or evidence of acknowledgment of liability or a continuing cause of action that could extend limitation.

Decision

The NCLT allowed Company Application No. 370 of 2022 and held that:

• The amounts in question did not constitute “deposits” under the Companies Act, 2013, as they were exempted promoter loans brought in pursuant to a bank stipulation.
• Sections 73(4) and 76(2) of the Companies Act, 2013 were not attracted.
• The company petition was barred by limitation and not maintainable.

Accordingly, the company petition was dismissed.

In this case the appellant was represented by Mr. Rajan Agarwal a/w Mr. Varun Agarwal, Advocates. Meanwhile the respondent was represented by Mr. Ramesh Chheda VC, Advocate.