Explain whether the following transactions will be considered as 'deposits' under the relevant provisions of the Companies Act, 2013 and the Rules made thereunder : (1) Prashant is Promoter and Managing Director of XYZ L

As per Section 2 (31) of the Companies Act 2013 "deposit includes any receipt of money by way of deposit or loan or in any other form by a company, but does not include such categories of amount as may be prescribed in consultation with the Reserve Bank of India." Further, in Rule 2(1)(c) of the Companies (Acceptance of Deposits) Rules, 2014 deposit is defined to include any receipt of money by way of deposit or loan or in any other form by a company except various categories of receipts specified therein. (1) Prashant's Loan: Rule 2(1)(c)(xiii) Companies (Acceptance of Deposits) Rules, 2014 provided that Deposit shall not include any amount brought in by promoters of the company by way of unsecured loan in pursuance of the stipulation of any lending financial institution or a bank subject to fulfilment of the following conditions namely: the loan is brought in pursuance of the stipulation imposed by the lending institutions or banks on the promoter to contribute such finance the loan is provided by the promoters themselves or by their relatives or by both and the exemption under this sub-clause shall be available only till the loans of financial institutions or banks are repaid and not thereafter. In view of the above provisions, the unsecured loan of ₹80 lakhs extended to the company by Prashant and his wife Meera shall not be considered deposits, till the time the loans extended by the Bank are repaid but not thereafter. (2) ABC Ltd.'s Advance: In Rule 2(1)(c)(xii)(a) Companies (Acceptance of Deposits) Rules, 2014 provided that Deposit shall not include any amount received in the course of, or for the purposes of, the business of the company as an advance for the supply of goods or provision of services accounted for in any manner whatsoever provided that such advance is appropriated against supply of goods or provision of services within a period of three hundred and sixty five days from the date of acceptance of such advance, provided further that in case of any advance which is subject matter of any legal proceedings before any court of law, the said time limit of three hundred and sixty five days shall not apply. In view of the above provisions, the advance of ₹20 lakhs received by ABC Ltd shall not be considered as deposit, even-though the amount is not appropriated within a period of three hundred and sixty five days, but as the same is subject matter of legal proceedings in the Court.