## Removal of Deposit Trustee

A Deposit Trustee may be removed before expiry of his term only by passing a resolution with the consent of all the directors present at the meeting.
In the case of companies required to appoint independent directors, at least one independent director must also consent.

## Meeting of Depositors

The Deposit Trustee shall call a meeting of all the depositors on:

1. Requisition in writing signed by depositors holding not less than one-tenth in value of the deposits for the time being subsisting; OR

2. The happening of any event which constitutes a default or which, in the opinion of the trustee, affects the interest of depositors; OR

3. Suo motu, whenever the trustee considers necessary.

## Register of Deposits

Every company that accepts deposits must maintain a Register of Deposits at its Registered Office.
Entries to be made within 7 days from the date of issue of the deposit receipt.
Entries must be authenticated by a director or the secretary or any other officer authorised by the Board.
The register must be preserved in good condition for a period of not less than 8 years from the financial year in which the latest entry is made.

Worked example

### Example 1

Example: Sun Ltd. has 500 depositors holding deposits of ₹10 crore in total. 40 depositors holding deposits worth ₹1.2 crore submit a written requisition to the Deposit Trustee asking him to call a meeting. Is the trustee bound to convene the meeting?

Answer: Yes. The depositors hold ₹1.2 crore which is 12% (more than 1/10th in value) of the total subsisting deposits of ₹10 crore. Once this threshold is met, the trustee is bound to call the meeting irrespective of the number of depositors.

⚠️ Common exam mistakes

Computing the 1/10th threshold by number of depositors instead of by value of deposits.
Forgetting to obtain consent of at least one independent director (where applicable) while removing the trustee.
Maintaining the register at a corporate office or factory instead of the Registered Office.
Making entries in the deposit register beyond 7 days from issue of receipt.

Bare-Act text Rule 14 · Companies (Acceptance of Deposits) Rules, 2014 · click to expand

Every company accepting deposits shall, from the date of such acceptance, maintain at its registered office one or more separate registers for deposits accepted/renewed... The entries shall be made within seven days from the date of issuance of the receipt duly authenticated by a director or secretary of the company or by any other officer authorised by the Board for this purpose.

Now that you've read this — what's next?

Move from understanding → mastery in 3 clicks. Each option below picks up from this lesson's topic.

🔥 Drill 5 Qs on this → ✍️ Adaptive practice →

Removal of Deposit Trustee, Meeting of Depositors and Register of Deposits

Worked example

⚠️ Common exam mistakes