# Acceptance of Deposits from Public [Section 76]

## 1. Who Can Accept Public Deposits?

Only an 'eligible company' — i.e. a public company with:

Net worth ≥ ₹100 crores, OR
Turnover ≥ ₹500 crores

## 2. Relationship with Section 73

Section 73 applies mutatis mutandis.
In case of conflict, Section 76 overrides Section 73 for public deposits.

## 3. Conditions Prior to Inviting Deposits from Public

### (a) Resolution

Pass a Special Resolution and file with ROC before inviting public deposits.
If borrowings are within Section 180(1)(c) limits, an Ordinary Resolution suffices.

### (b) Caps on Deposits (Including Outstanding)

Source	Cap (% of paid-up capital + free reserves + securities premium)
From members	10%
From persons other than members	25%
Eligible Government company	35% (whether from members or public)

### (c) Credit Rating

Must obtain credit rating covering net worth, liquidity and ability to pay.
(Detailed continued requirements — to be covered in next page.)

Worked example

### Example 1

Example: XYZ Ltd. is a listed public company with net worth of ₹150 crore. It qualifies as an 'eligible company' under Section 76. To invite public deposits, it must pass a Special Resolution and file it with ROC. Deposits from public may not exceed 25% of (paid-up capital + free reserves + securities premium).

### Example 2

Government Company Example: ABC Ltd., an eligible Government Company, can accept deposits up to 35% regardless of source (members or public).

⚠️ Common exam mistakes

Believing private companies can accept deposits from public — only eligible public companies can.
Applying 35%/100% caps of Section 73 to public deposits — those are for member deposits only.
Forgetting that an Ordinary Resolution is sufficient if borrowings are within Section 180(1)(c).
Treating the eligible Government Company cap of 35% as applying to all government companies — it applies to eligible Government Companies only.
Skipping the credit rating requirement which is mandatory and continuous.

Bare-Act text Section 76 · Companies Act, 2013 · click to expand

Section 76 enables certain 'eligible' public companies to accept deposits from persons other than members; Section 73 provisions apply mutatis mutandis. In case of conflict, Section 76 prevails for public deposits.

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Acceptance of Deposits from Public by Eligible Companies [Section 76]

Worked example

⚠️ Common exam mistakes