X Ltd, an unlisted public company, with the following: Paid-up share capital: ₹25 Crore Reserves & Surplus: ₹40 Crore Annual turnover: ₹300 Crore wants to accept deposits from its members and the public. Advise the c

X Ltd does not fall under the definition of 'eligible company' under the Companies (Acceptance of Deposits) Rules 2014. The primary condition for an eligible company is that a public company shall have net worth of not less than ₹100 crores or turnover of not less than ₹500 crore. In the present case, neither of the threshold limits are met (Net Worth = ₹25 Cr + ₹40 Cr = ₹65 Cr; Turnover = ₹300 Cr). Therefore, X Ltd is not an 'eligible company'. In the present case, X Ltd can accept deposits only from members of the Company up to a limit of 35% of the aggregate of the paid-up share capital, free reserves and securities premium account. X Ltd can accept deposits from its members up to an amount of 35% of ₹65 Crore (35% of (₹25 Cr + ₹40 Cr)). They cannot accept any deposit from the public. However, there is no limit for acceptance of deposit from its directors. X Ltd is required to ensure inter alia compliance of the following, for acceptance of deposits from members: The Company is required to pass an ordinary resolution in the shareholders meeting authorizing the acceptance of deposit from the members. A Circular should be issued to its members in form DPT-1 and in addition, the company may publish the same in English language in one English newspaper and one vernacular language in vernacular newspaper having wide circulation in the state of the registered office of the company. The Company should obtain a credit rating before the submission of the circular to the Registrar as disclosure of the same is required in the circular.