Regulation 56 of LODR
(1) A may issue with an option to convert such debentures into , either wholly or partly at the time of redemption:
Provided that the issue of debentures with an option to convert such debentures into shares, wholly or partly, shall be approved by a special resolution passed at a general meeting.
(2) No company shall issue any debentures carrying any .
(3) Secured debentures may be issued by a company subject to such terms and conditions
(4) Where debentures are issued by a company under this section, the company shall create a debenture redemption reserve account out of the profits of the company available for payment of and the amount credited to such account shall not be utilised by the company except for the redemption of debentures.
(5) No company shall issue a or make an offer or invitation to the public or to its exceeding five hundred for the subscription of its debentures, unless the company has, before such issue or offer, appointed one or more debenture trustees and the conditions governing the appointment of such trustees shall be such
(6) A debenture trustee shall take steps to protect the interests of the debenture-holders and redress their grievances in accordance with such rules .
(7) Any provision contained in a trust deed for securing the issue of debentures, or in any contract with the debenture-holders secured by a trust deed, shall be void in so far as it would have the effect of exempting a trustee thereof from, or indemnifying him against, any liability for breach of trust, where he fails to show the degree of care and due diligence required of him as a trustee, having regard to the provisions of the trust deed conferring on him any power, authority or discretion:
Provided that the liability of the debenture trustee shall be subject to such exemptions as may be agreed upon by a majority of debenture-holders holding not less than three-fourths in value of the total debentures at a meeting held for the purpose.
(8) A company shall pay interest and redeem the debentures in accordance with the terms and conditions of their issue.
(9) Where at any time the debenture trustee comes to a conclusion that the assets of the company are insufficient or are likely to become insufficient to discharge the principal amount as and when it becomes due, the debenture trustee may and the may, after hearing the company and any other person interested in the matter, by order, impose such restrictions on the incurring of any further liabilities by the company as the Tribunal may consider necessary in the interests of the debenture-holders.
(10) Where a company fails to redeem the debentures on the date of their maturity or fails to pay interest on the debentures when it is due, the Tribunal may, on the application of any or all of the debenture-holders, or debenture trustee and, after hearing the parties concerned, direct, by order, the company to redeem the debentures forthwith on payment of principal and interest due thereon.
If any default is made in complying with the order of the Tribunal under this section, every of the company who is in default shall be punishable with imprisonment for a term which may extend to three years or with fine which shall not be less than two lakh rupees but which may extend to five lakh rupees, or with both.
(12) A contract with the company to take up and pay for any debentures of the company may be enforced by a decree for specific performance.
(13) The Central Government may prescribe the procedure, for securing the issue of debentures, the form of debenture trust deed, the procedure for the debenture-holders to inspect the trust deed and to obtain copies thereof, quantum of debenture redemption reserve required to be created and such other matters.
Provided that— (a) the instruments referred to in Chapter III-D of the Reserve Bank of India Act, 1934; and
(b) such other instrument, as may be prescribed by the Central Government in consultation with Reserve Bank of India, issued by a company,
shall not be treated as debenture;
(i) the subscriber to the memorandum of the company who shall be deemed to have agreed to become member of the company, and on its registration, shall be entered as member in its register of members;
(ii) every other person who agrees in writing to become a member of the company and whose name is entered in the register of members of the company;
(iii) every person holding shares of the company and whose name is entered as a beneficial owner in the records of a depository
27.3.73 National Company Law Tribunal Rules, 2016
73. Application under sections 71(9), 71(10), section 73{4) or section 74(2) and,76(2)-
(1)Where a company fails to redeem the debentures or repay the deposits or any part thereof or any interest thereon, an application under sub-section (10) of section 71 or under sub-section (4) of section 73 of the Act or section 45QA of the Reserve Bank of India Act, 1934 (2 of 1934), shall be filed to the Tribunal, in in duplicate and shall be accompanied by such documents as are mentioned in , by-
(a) in case of debentures, all or any of the debenture holders concerned, or debenture trustee; or
(b) in case of deposits, all or any of the where the deposits are secured, by the depositors concerned, or deposit trustee.
(2) There shall be attached to the application, a list of depositors or debenture holders, as the case may be, setting forth the following details in respect of every such depositor or debenture holder:-
(a) full name, age, father’s/ mother’s/ spouse’s name, occupation and full residential address;
(b) fixed deposit receipt number or debenture certificate number, as the case may be;
(c) date of maturity;
(d) amount due to the person by the company;
(e) amount already paid by the company, if any;
(f) total amount due as on the date on the application: Provided that where the company is the applicant, it shall file an affidavit stating that the list of depositors or debenture holders, as the case may be, is correct, and that the estimated values as given in the list of the amount payable to such depositors or debenture holders are proper estimates of the values of such debts and claims.
(3) The Tribunal shall pass an appropriate order within a period of sixty days from the date of receipt of application under sub-rule (1):
Provided that the Tribunal shall, before making any order under this rule, give a reasonable opportunity of being heard to the company and any other person interested in the matter.
(a) The Tribunal may, if it is satisfied, on the application filed under sub-rule (1), that it is necessary so to do, to safeguard the interests of the company, the debenture holders or the depositors, as the case may be, or in the public interest, direct, by order, the company to make repayment of such deposit or debenture or part thereof forthwith or within such time and subiect to such conditions as may be specified in the order: Provided that while passing the order, the Tribunal shall consider the financial condition of the company, the amount or deposit or debenture or part thereof and the interest payable thereon.
(5) The application under sub-section (2) of section 74 and sub-section (2) of section 76 read with section 74(2) shall be in and shall accompanied with the documents as per
(6) A copy of application under sub-section (2) of section 76 and under subsection (2) of section 74 shall be served on the Regional Director and the Registrar of Companies before the date of hearing.
(7) The Registrar of Companies in consultation with Regional Director shall submit before the Tribunal, the report on the affairs of the company within thirty days from the date of the receipt of the application and Tribunal may consider any observation made by the Registrar of Companies before passing an order.
Annexure B
| S.No. | Section of the Act | Nature of Petition | Enclosures to the Petition |
| 1. | Sec. 2 (41) | Application for change in financial year | 1.Copy of the memorandum and articles of association. 2. Copy of balance sheet of companies. 3. Affidavit verifying the petition. 4. Bank draft evidencing payment of application fee. 5. Memorandum of appearance with copy of the Board Resolution or the executed Vakalatnama, as the case may be. |
| 2. | Sec. 7 (7) | Application to Tribunal where company has been incorporated by furnishing false or incorrect info or by any fraudulent action. | 1. Copy of the memorandum and articles of association. 2. Document in proof of false or incorrect information or fraudulent action. 3. Affidavit verifying the petition. 4. Bank draft evidencing payment of application fee. 5. Memorandum of appearance with copy of the Board Resolution or the executed Vakalatnama, as the case may be. |
| 3. | Sec. 14 (1) | Conversion of public company into a private company. | 1.Copy of the memorandum and articles of association. 2. Copy of the documents showing that the company ceased to become a public company. 3. Affidavit verifying the petition. 4. Bank draft evidencing payment of application fee. 5. Memorandum of appearance with copy of the Board Resolution or the executed Vakalatnama, as the case may be. |
| 4. | Sec. 55 (3) | Application for issue further redeemable preference shares. | 1. Copy of the memorandum and articles of association. 2. Documents showing the terms of issue of the existing preference shares. 3. Copy of the Board Resolution and resolution of general meeting for issue of further redeemable preference shares. 4. Copy of the latest audited balance sheet with the profit and loss account of the company with auditor’s report and director’s report. 5. Affidavit verifying the petition. 6. Bank draft evidencing payment of application fee. 7. Memorandum of appearance with copy of the Board Resolution or the executed Vakalatnama, as the case may be. |
| 5. | Sec. 58 (3) or 59 | Appeal against refusal of registration of shares; or Appeal for rectification of register of member. | Where the company is the petitioner. 1. Copy of the memorandum and articles of association 2. Latest audited balance-sheet and profit and loss account, auditor’s report and director’s report. 3. Authenticated copy of the extract of the Register of Members. 4. Copy of the resolution of the Board or Committee of Directors (where applicable) 5. Any other relevant documents. 6. Affidavit verifying the petition. 7. Bank draft evidencing payment of application fee. 8. Memorandum of appearance with copy of the Board Resolution or the executed Vakalatnama, as the case may be. 9. Two extra copies of the petition. Where the petition is made by any other person. 1. Documentary evidence in support of the statements made in the petition including the copy of the letter written by the petitioner to the company for purpose of registering the transfer of, or the transmission of the right to, any share, or interest in, or debentures as also a copy of the letter of refusal of the company. 2. Copies of the documents returned by the company. 3. Any other relevant document. 4. Affidavit verifying the petition. 5. Bank draft evidencing payment of application fee. 6. Memorandum of appearance with copy of the Board’s Resolution or the executed Vakalatnama, as the case may be. 7. Two extra copies of the petition. |
| 6. | Sec. 61 (1) | Application to Tribunal for consolidation and division of share capital. | 1. Copies of memorandum and articles of association; 2. Copies of audited balance sheets for past 3 years; 3. Resolution for allowing such consolidation or division and providing justification for the same; 4. Documents in proof of new capital structure and class of shares being consolidated or divided; 5. Affidavit verifying the petition. 6. Bank draft evidencing payment of application fee. 7. Memorandum of appearance with copy of the Board’s Resolution or the executed Vakalatnama, as the case may be. 8. Two extra copies of the application 9. Any other relevant documents. |
| 7. | Sec. 73 (4) | Application by repayment of deposit or interest. | 1. Copy of the deposit receipt 2. Copy of the correspondence exchanged with the company. 3. Bank draft evidencing payment of application fee. 4. Any other relevant document. |
| 8. | Sec. 74 (2) | Application to allow further time as considered reasonable to the company to repay deposits. | 1. Names and addresses of the officers of the company. 2. Full details of 3. Reasons for nonpayment or late payment. 4. Annual Reports for the last three years. 5. Projection and cash flow statement for the next three financial years duly certified by Statutory Auditors of the company. 6. Any other relevant document |
| 9. | Sec. 97 (1) | Application for calling of Annual General meeting. | 1. Affidavit verifying the petition. 2. Bank draft evidencing payment of application fee. 3. Any other relevant document. |
| 10. | Sec. 98 (1) | Application for calling of general meeting of company other than annual general meeting | 1. Documentary evidence in proof of status of the applicant. 2. Affidavit verifying the petition. 3. Bank draft evidencing payment of application fee. 4. Memorandum of appearance with copy of the Board’s Resolution or the executed Vakalatnama, as the case may be. 5. Any other relevant document |
| 11. | Sec. 119 (4) | Petition to pass an order directing immediate inspection of minutes books or directing a copy thereof be sent forthwith to person requiring it. | 1. Documentary evidence, if any, showing the refusal of the company to give inspection to the petitioner. 2. Affidavit verifying the petition. 3. Bank draftevidencing payment of application fee. 4. Memorandum of appearance with copy of the Board’s Resolution or the executed Vakalatnama, as the case may be. 5. Any other relevant document. |
| 12. | Sec. 131 (1) | Application by company for voluntary revision of financial statement on Board's report. | 1. Audited Financial statements of relevant period; 2. Copies of memorandum and articles of association. 3. The details of the Managing Director, Chief Financial Officer, directors, Company Secretary and officer of the company responsible for making and maintaining such books of accounts and financial statement. 3. Where such accounts are audited, documents in proof of the name and contact details of the auditor or any former auditor who audited such accounts. 4. Copy of the Board resolution passed by the Board of Directors. 5. Affidavit verifying the petition. 6. Bank draft evidencing payment of application fee. 7. Memorandum of appearance with copy of the Board’s Resolution or the executed Vakalatnama, as the case may be. 8. Any other relevant document. |
| 12. A (Inserted vide NCLT Amendment Rules,2020 dated 03.02.2020) | Sec 230 (12) | Application in cases of takeover offer of companies which are not listed. | 1. Affidavit verifying the petition 2. Memorandum of appearance with copy of the Board's Resolution or the executed vakalatnama, as the case may be. 3. Documents in support of the grievance against the takeover. 4. Any other relevant document. |
| 13. (Inserted vide NCLT Amendment Rules,2016) | - | Wherever no document is prescribed to be attached with the application or petition, documents as mentioned in next column may be attached, as applicable. | 1. Document and/or other evidence in support of the statement made in the application or appeal or petition, as are reasonably open to the petitioner(s); 2. Documentary evidence in proof of the eligibility and status of the petitioner(s) with the voting power held by each of them, wherever applicable; 3. Where the petition is presented on behalf of members, the letter of consent given by them, if applicable; 4. Statement of particulars, showing names, address, number of shares held, and whether all calls and other monies due on shares have been paid in respect of members who have given consent to the petition being presented on their behalf; 5. Where the petition is presented by a member or members authorised by the Central Government, the order of the Central Government authorising the officer(s) or member or members to present the petition shall be similarly annexed to the petition; 6. Affidavit verifying the petition; 7. Evidence regarding payment of fee; 8. Memorandum of appearance with copy of the Board Resolution or the vakalatnama, as the case may be; 9. Three copies of the petition; and 10. Any other documents in support of the case. |
4.1.18-Companies (Share Capital and Debentures) Rules, 2014.
(1) The company shall not issue secured debentures, unless it complies with the following conditions, namely:-
(a) An issue of secured debentures may be made, provided the date of its redemption shall not exceed ten years from the date of issue.
Provided that a company engaged in the setting up of infrastructure projects may issue secured debentures for a period exceeding ten years but not exceeding thirty years;
that the following classes of companies may issue secured debentures for a period exceeding ten years but not exceeding thirty years,
(i) Companies engaged in setting up of infrastructure projects;
(ii) ‘Infrastructure Finance Companies’ as defined in clause (viia) of sub-direction (1) of direction 2 of Non-Banking Financial (Non-deposit accepting or holding) Companies Prudential Norms (Reserve Bank) Directions, 2007;
(iii) ‘Infrastructure Debt Fund Non-Banking Financial companies’ as defined in clause (b) direction 3 of Infrastructure Debt Fund Non-Banking Financial Companies (Reserve Bank) Directions, 2011.
Companies permitted by a Ministry or Department of the Central Government or by Reserve Bank of India or by the National Housing Bank or by any other statutory authority to issue debentures lbr a period exceeding ten years.
Such an issue of debentures shall be secured by the creation of a charge on the properties or assets of the company or its subsidiaries or its holding company or its associates companies, having a value which is sufficient for the due repayment of the amount of debentures and interest thereon.
(b) such an issue of debentures shall be secured by the creation of a charge, on the properties or assets of the company, having a value which is sufficient for the due repayment of the amount of debentures and interest thereon;
(c) the company shall appoint a debenture trustee before the issue of prospectus or letter of offer for subscription of its debentures and not later than sixty days after the allotment of the debentures, execute a debenture trust deed to protect the interest of the debenture holders ; and
(d) the security for the debentures by way of a charge or mortgage shall be created in favour of the debenture trustee on-
any specific movable property of the company or its holding company or subsidiaries or associate companies or otherwise.
any specific movable property of the company ; or
(i) any specific movable property of the company (not being in the nature of pledge); or
any specific immovable property wherever situate, or any interest therein:
(ii) any specific immovable property wherever situate, or any interest therein
in case of a non-banking financial company, the charge or mortgage under sub-clause (i) may be created on any movable property.
that in case of any issue of debentures by a Government company which is fully secured by the guarantee given by the Central Government or one or more State Government or by both, the requirement for creation of charge under this sub-rule shall not apply.
that in case of any loan taken by a subsidiary company from any bank or financial institution the charge or mortgage under this sub-rule may also be created on the properties or assets of the holding company;
(2) The company shall appoint debenture trustees under sub-section (5) of section 71, after complying with the following conditions, namely:-
(a) the names of the debenture trustees shall be stated in letter of offer inviting subscription for debentures and also in all the subsequent notices or other communications sent to the debenture holders;
(b) before the appointment of debenture trustee or trustees, a written consent shall be obtained from such debenture trustee or trustees proposed to be appointed and a statement to that effect shall appear in the letter of offer issued for inviting the subscription of the debentures;
(c) A person shall not be appointed as a debenture trustee, if he-
(i) beneficially holds shares in the company;
(ii) is a promoter, director or key managerial personnel or any other officer or an employee of the company or its holding, subsidiary or associate company;
(iii) is beneficially entitled to moneys which are to be paid by the company otherwise than as remuneration payable to the debenture trustee;
(iv) is indebted to the company, or its subsidiary or its holding or or a subsidiary of such holding company;
(v) has furnished any guarantee in respect of the principal debts secured by the debentures or interest thereon;
(vi) has any pecuniary relationship with the company amounting to two per cent. or more of its gross turnover or total income or fifty lakh rupees or such higher amount as may be prescribed, whichever is lower, during the two immediately preceding financial years or during the current financial year;
(vii) is relative of any promoter or any person who is in the employment of the company as a director or key managerial personnel
(d) the Board may fill any casual vacancy in the office of the trustee but while any such vacancy continues, the remaining trustee or trustees, if any, may act:
Provided that where such vacancy is caused by the resignation of the debenture trustee, the vacancy shall only be filled with the written consent of the majority of the debenture holders.
(e) any debenture trustee may be removed from office before the expiry of his term only if it is approved by the holders of not less than three fourth in value of the debentures outstanding, at their meeting.
(3) It shall be the duty of every debenture trustee to-
(a) satisfy himself that the letter of offer does not contain any matter which is inconsistent with the terms of the issue of debentures or with the trust deed;
(b) satisfy himself that the covenants in the trust deed are not prejudicial to the interest of the debenture holders;
(c) call for periodical status or performance reports from the company;
(d) communicate promptly to the debenture holders defaults, if any, with regard to payment of interest or redemption of debentures and action taken by the trustee therefor;
(e) appoint a nominee director on the Board of the company in the event of-
(i) two consecutive defaults in payment of interest to the debenture holders; or
(ii) default in creation of security for debentures; or
(iii) default in redemption of debentures.
(f) ensure that the company does not commit any breach of the terms of issue of debentures or covenants of the trust deed and take such reasonable steps as may be necessary to remedy any such breach;
(g) inform the debenture holders immediately of any breach of the terms of issue of debentures or covenants of the trust deed;
(h) ensure the implementation of the conditions regarding creation of security for the debentures, if any, and debenture redemption reserve;
(i) ensure that the assets of the company issuing debentures and of the guarantors, if any, are sufficient to discharge the interest and principal amount at all times and that such assets are free from any other encumbrances except those which are specifically agreed to by the debenture holders;
(j) do such acts as are necessary in the event the security becomes enforceable;
(k) call for reports on the utilization of funds raised by the issue of debentures-
(l) take steps to convene a meeting of the holders of debentures as and when such meeting is required to be held;
(m) ensure that the debentures have been converted or redeemed in accordance with the terms of the issue of debentures;
(n) perform such acts as are necessary for the protection of the interest of the debenture holders and do all other acts as are necessary in order to resolve the grievances of the debenture holders.
(4) The meeting of all the debenture holders shall be convened by the debenture trustee on-
(a) requisition in writing signed by debenture holders holding at least one-tenth in value of the debentures for the time being outstanding;
(b) the happening of any event, which constitutes a breach, default or which in the opinion of the debenture trustees affects the interest of the debenture holders.
(5) For the purposes of sub-section (13) of section 71 and sub-rule (1) a trust deed in or as near thereto as possible shall be executed by the company issuing debentures in favour of the debenture trustees within sixty days of allotment of debentures.
(6) The provisions of sub-rules (2) to (5) of rule 18 shall not be applicable to the public offer of debentures.
The company shall comply with the requirements with regard to Debenture Redemption Reserve (DRR) and investment or deposit of sum in respect of debentures maturing during the year ending on the 31st day of March of next year, in accordance with the conditions given below:-
(a) Debenture Redemption Reserve shall be created out of profits of the company available for payment of dividend;
(b) the limits with respect to adequacy of Debenture Redemption Reserve and investment or deposits, as the case may be, shall be as under;-
(i) Debenture Redemption Reserve is not required for debentures issued by All India Financial Institutions regulated by Reserve Bank of India and Banking Companies for both public as well as privately placed debentures;
(ii) For other Financial Institutions within the meaning of clause (72) of section 2 of the Companies Act, 2013, Debenture Redemption Reserve shall be as applicable to Non –Banking Finance Companies registered with Reserve Bank of India.
(iii) For listed companies (other than All India Financial Institutions and Banking Companies as specified in sub-clause (i)), Debenture Redemption Reserve is not required in the following cases –
(A) in case of public issue of debentures –
A. for NBFCs registered with Reserve Bank of India under section 45-IA of the RBI Act, 1934 and for Housing Finance Companies registered with National Housing Bank;
B. for other listed companies;
(B) in case of privately placed debentures, for companies specified in sub-items A and B.
(iv) for unlisted companies, (other than All India Financial Institutions and Banking Companies as specified in sub-clause (i)) –
(A) for NBFCs registered with RBI under section 45-IA of the Reserve Bank of India Act, 1934 and for Housing Finance Companies registered with National Housing Bank, Debenture Redemption Reserve is not required in case of privately placed debentures.
(B) for other unlisted companies, the adequacy of Debenture Redemption Reserve shall be ten percent. of the value of the outstanding debentures;
In case a company is covered in item (A) of sub-clause (iii) of clause (b) or item (B) of sub-clause (iv) of clause (b), it shall on or before the in each year, in respect of debentures issued by such a company, invest or deposit, as the case may be, a sum which shall not be less than fifteen percent., of the amount of its debentures maturing during the year, ending on the 31st day of March of the next year in any one or more methods of investments or deposits as provided in sub-clause (vi):
Provided that the amount remaining invested or deposited, as the case may be, shall not any time fall below fifteen percent. of the amount of the debentures maturing during the year ending on 31st day of March of that year.
(v) In case a company is covered in item (A) or item (B) of sub-clause (iii) of clause (b) or item (B) of sub-clause (iv) of clause (b), it shall on or before the in each year, in respect of debentures issued by a company covered in item (A) or item (B) of sub-clause (iii) of clause (b) or item (B) of sub-clause (iv) of clause (b), invest or deposit, as the case may be, a sum which shall not be less than fifteen per cent., of the amount of its debentures maturing during the year, ending on the 31st day of March of the next year in any one or more methods of investments or deposits as provided in sub-clause (vi):
Provided that the amount remaining invested or deposited, as the case may be, shall not at any time fall below fifteen percent. of the amount of the debentures maturing during the year ending on 31st day of March of that year.
(vi) for the purpose of sub-clause (v), the methods of deposits or investments, as the case may be, are as follows:—
(A) in deposits with any scheduled bank, free from any charge or lien;
(B) in unencumbered securities of the Central Government or any State Government;
(C) in unencumbered securities mentioned in sub-clause (a) to (d) and (ee) of section 20 of the Indian Trusts Act, 1882;
(D) in unencumbered bonds issued by any other company which is notified under sub-clause (f) of section 20 of the Indian Trusts Act, 1882:
Provided that the amount invested or deposited as above shall not be used for any purpose other than for redemption of debentures maturing during the year referred above.
(c) in case of partly convertible debentures, Debenture Redemption Reserve shall be created in respect of non-convertible portion of debenture issue in accordance with this sub-rule.
(d) the amount credited to Debenture Redemption Reserve shall not be utilized by the company except for the purpose of redemption of debentures.
(7) The company shall create a Debenture Redemption Reserve for the purpose of redemption of debentures, in accordance with the conditions given below-
(a) the Debenture Redemption Reserve shall be created out of the profits of the company available for payment of dividend;
(b) the company shall create Debenture Redemption Reserve (DRR) in accordance with following conditions:-
(i) No DRR is required for debentures issued by All India Financial Institutions (AIFIs) regulated by Reserve Bank of India and Banking Companies for both public as well as privately placed debentures. For other Financial Institutions (FIs) within the meaning of clause (72) of section 2 of the Companies Act, 2013, DRR will be as applicable to NBFCs registered with RBI.
(ii) For NBFCs registered with the RBI under Section 45-IA of the RBI (Amendment) Act, 1997, ‘the adequacy’ of DRR will be 25% of the value of debentures issued through public issue as per present SEBI (Issue and Listing of Debt Securities) Regulations, 2008, and no DRR is required in the case of privately placed debentures.
(iii) For other companies including manufacturing and infrastructure companies, the adequacy of DRR will be 25% of the value of debentures issued through public issue as per present SEBI (Issue and Listing of Debt Securities), Regulations 2008 and also 25% DRR is required in the case of privately placed debentures by listed companies. For unlisted companies issuing debentures on private placement basis, the DRR will be 25% of the value of debentures.
where a company intends to redeem its debentures prematurely, it may provide for transfer of such amount in Debenture Redemption Reserve as is necessary for redemption of such debentures even if it exceeds the limits specified in this sub-rule
(c) every company required to create Debenture Redemption Reserve shall on or before the 30th day of April in each year, invest or deposit, as the case may be, a sum which shall not be less than fifteen percent, of the amount of its debentures maturing during the year ending on the 31st day of March of the next year, in any one or more of the following methods, namely:-
(i) in deposits with any scheduled bank, free from any charge or lien;
(ii) in unencumbered securities of the Central Government or of any State Government;
(iii) in unencumbered securities mentioned in sub-clauses (a) to (d) and (ee) of section 20 of the Indian Trusts Act, 1882;
(iv) in unencumbered bonds issued by any other company which is notified under sub-clause (f) of section 20 of the Indian Trusts Act, 1882;
(v) the amount invested or deposited as above shall not be used for any purpose other than for redemption of debentures maturing during the year referred above:
Provided that the amount remaining invested or deposited, as the case may be, shall not at any time fall below fifteen per cent of the amount of the debentures maturing during the year ending on the 31st day of March of that year;
(d) in case of partly convertible debentures, Debenture Redemption Reserve shall be created in respect of non-convertible portion of debenture issue in accordance with this sub-rule.
(e) the amount credited to the Debenture Redemption Reserve shall not be utilised by the company except for the purpose of redemption of debentures.
(8) (a) A trust deed for securing any issue of debentures shall be open for inspection to any member or debenture holder of the company, in the same manner, to the same extent and on the payment of the same fees, as if it were the register of members of the company; and
(b) A copy of the trust deed shall be forwarded to any member or debenture holder of the company, at his request, within seven days of the making thereof, on payment of fee.
(9) Nothing contained in this rule shall apply to any amount received by a company against issue of commercial paper or any other similar instrument issued in accordance with the guidelines or regulations or notification issued by the Reserve Bank of India.
(10) In case of any offer of foreign currency convertible bonds or foreign currency bonds issued in accordance with the Foreign Currency Convertible Bonds and Ordinary Shares (Through Depository Receipt Mechanism) Scheme, 1993 or regulations or directions issued by the Reserve Bank of India, the provisions of this rule shall not apply unless otherwise provided in such Scheme or regulations or directions.
Nothing contained in this rule shall apply to rupee denominated bonds issued exclusively to overseas investors in terms of A.P. (DIR Series) Circular No. 17 dated September 29, 2015 of the Reserve Bank of India.
Explanation.—For the purpose of this clause—
(a) the expression “significant influence” means control of at least twenty per cent. of total voting power, or control of or participation in business decisions under an agreement;
(b) the expression “joint venture” means a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement;
- For Debentures maturing in the financial year 2020-21, this requirement shall be allowed to be complied with till December 31, 2020. To view the further relaxation circular dated 29.09.2020, Click Here.
- For Debentures maturing in the financial year 2020-21, this requirement shall be allowed to be complied with till September 30, 2020. To view the further relaxation circular dated 19.06.2020, Click Here.
- For Debentures maturing in the financial year 2020-21, this requirement shall be allowed to be complied with till June 30, 2020. To view the relaxation circular dated 24.03.2020, Click Here.
Commencement Notification under Companies (Amendment) Act, 2020 dated 21.12.2020
Companies (Amendment) Act, 2020 dated 28.09.2020
Companies (Share Capital and Debentures) Amendment Rules, 2015 [GSR 210 (E)] dated 18/03/2015
Companies (Share Capital and Debentures) Fourth Amendment Rules, 2016 [GSR 791(E)] dated 12/08/2016
Companies (Share Capital and Debentures) Third Amendment Rules, 2015 dated 06/11/2015
Companies (Share Capital and Debentures) Third Amendment Rules, 2016 [GSR 704(E)] dated 19/07/2016
Companies (Share Capital and Debentures)Amendment Rules, 2014 [GSR 413 (E)] dated 18/06/2014
Enforcement Notification S.O. 1934(E) dated 01/06/2016
Enforcement Notification S.O. 902(E) dated 26/03/2014
National Company Law Tribunal (Amendment) Rules, 2016 [G.S.R 1159(E)] dated 20/12/2016
The Companies (Share Capital and Debentures) Amendment Rules, 2019 dated 16.08.2019