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Microlesson · 5-min read

Issuance of Circular / Advertisement for Inviting Deposits [Rule 4]

# Issuance of Circular / Advertisement [Rule 4]

The nature of the document differs based on whether the company is not an eligible company (member deposits) or an eligible company (public deposits).

## A. Company OTHER than Eligible Company (Member Deposits)

  • Issue circular in Form DPT-1 to all members by:
  • Registered post with acknowledgement due, OR
  • Speed post, OR
  • Electronic mode.
  • Optional publication in:
  • English newspaper (English language), and
  • Vernacular newspaper (vernacular language),

having wide circulation in the State of registered office.

  • Statutory Auditor's Certificate attached to DPT-1 stating: no default in repayment of deposits/interest. If there was a default, it must have been made good and 5 years must have elapsed since the cure date.
  • Authority of the Board of Directors.
  • Filing with Registrar: At least 30 days before issue, file copy duly signed by majority of directors (or their authorised agents) with the ROC.

## B. Eligible Company (Public Deposits)

  • Issue circular in the form of an ADVERTISEMENT in Form DPT-1.
  • Mandatory publication in:
  • English newspaper (English) AND
  • Vernacular newspaper (vernacular language),

both with wide circulation in the State of registered office.

  • If the company has a website → circular shall be placed on the website.
  • Authority and name of the Board of Directors.
  • Filing with Registrar: At least 30 days before issue, file with the ROC signed by majority of directors.

### Validity of the Advertisement

Valid till the earliest of:

  • (a) 6 months from closure of the financial year in which it was issued, OR
  • (b) Date on which financial statements are laid before the AGM (or latest day on which the AGM ought to have been held if not actually held).

### Fresh Advertisement

  • A fresh advertisement must be issued in each succeeding financial year for inviting deposits in that year.

### Issue vs Effective Date

  • Date of issue of advertisement = date the ad appeared in the newspaper.
  • Effective date of circular = date the circular was dispatched.

## Quick Compare

ItemNon-Eligible (Members)Eligible (Public)
FormDPT-1 circularDPT-1 advertisement
DistributionRegistered/speed post / e-modeMandatory newspaper + website
NewspaperOptionalMandatory (English + vernacular)
Filing with ROC≥30 days before issue≥30 days before issue
ValiditySame logic (FY based)6 months / AGM date — earliest

Worked example

### Example 1

Example 1 — Filing window: A company plans to issue the deposit circular on 15 July 2025. The signed copy must reach the Registrar by 15 June 2025 (30 days before).

### Example 2

Example 2 — Validity: Eligible company issued an advertisement on 1 Aug 2024 (FY 2024-25). The 6-month-from-closure-of-FY date = 30 Sept 2025. AGM held on 20 Aug 2025. Validity expires on the earlier of the two = 20 Aug 2025.

### Example 3

Example 3 — Default cure: A company defaulted on deposit repayment in March 2019, cured the default in October 2019. It can issue a fresh circular only after October 2024 (5 years after cure).

⚠️ Common exam mistakes

  • Confusing 'date of issue' with 'effective date' — newspaper date vs dispatch date are tracked separately.
  • Assuming a single advertisement carries over multiple FYs — a FRESH one is required each FY.
  • Skipping the website upload (mandatory if a website exists).
  • Forgetting the 30-day pre-filing requirement with the ROC.
  • Treating newspaper publication as optional for an eligible company — for eligible companies, it is MANDATORY.
Bare-Act text Rule 4 · Companies (Acceptance of Deposits) Rules, 2014 · click to expand
Rule 4 — Form and particulars of advertisements or circulars: (1) Every company referred to in sub-section (2) of section 73 intending to invite deposit from its members shall issue a circular to all its members by registered post with acknowledgement due or speed post or by electronic mode in Form DPT-1... (2) Every eligible company intending to invite deposits shall issue a circular in the form of an advertisement in Form DPT-1 in English language in an English newspaper and in vernacular language in one vernacular newspaper having wide circulation in the State in which the registered office of the company is situated...
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