Understanding DPT-3 Filing with MCA: A Gateway to Financial Accountability

In the realm of corporate compliance, the annual filing of Form DPT-3 has emerged as a hot topic, generating significant interest among businesses and professionals. As companies navigate the complex landscape of regulatory guidelines set by the Ministry of Corporate Affairs (MCA) in India, understanding and fulfilling the DPT-3 filing requirement has become paramount. This article aims to shed light on the intricacies of the DPT-3 filing, its significance, and the key steps companies need to take to ensure compliance.

The Importance of DPT-3 Filing

Reporting requirements under Section 2(1)(c) of the Companies Act, 2013, which mandates certain types of borrowings to be reported to the Ministry of Corporate Affairs (MCA) in India through filing Form DPT-3 annually under Rule 16 and 16A of the Companies (Acceptance of Deposits) Rules, 2014.

Form DPT-3 is a return to be filed by companies for the purpose of reporting the details of outstanding loans or borrowings received by them, various types of borrowings, such as loans from banks, non-banking financial companies (NBFCs), directors or their relatives, amounts received for allotment (pending application), advances from customers, and amounts received through convertible notes, among others by providing the information to the MCA regarding their outstanding borrowings, ensuring transparency and compliance with the regulations specified under the Companies Act and we have summarised the features herewith-

• DPT-3 filing is a one-time return that must be submitted by companies that have accepted deposits, as outlined in Section 73 of the Companies Act 2013 and the rules established under it.
• This filing requirement ensures compliance with the regulations related to accepting deposits from the public.
• Mandatory for companies that have outstanding loans which do not qualify as deposits [Section 2 (1)(c)], company has received money in the form of a loan, but it does not meet the criteria to be classified as a deposit, still needs to file the DPT-3 return.
• Normally, any amount received as a deposit from the public is considered a public deposit. These deposits are subject to specific rules and regulations outlined in the Companies Act and relevant laws. The DPT-3 filing helps track and monitor such public deposits, ensuring transparency and compliance with the applicable regulations.

To ensure the protection and interests of deposit holders and creditors, the Central Government, in consultation with the Reserve Bank of India (RBI), introduced the Companies (Acceptance of Deposits) Amendment Rules, 2019 on January 22, 2019. These rules amended the Companies (Acceptance of Deposits) Rules, 2014 subject to-

• All companies, except Government Companies, are required to file a form called DPT-3.
• The filing is necessary for both secured and unsecured outstanding money or loans that are not classified as deposits, as of March 31, 2023.
• The period of outstanding loans or money extends from April 1, 2022, to March 31, 2023.
• The form must also be filed if the outstanding loan or money is obtained from a holding, subsidiary, or associate company of the company in question.

Mandatory Compliance and Reporting Obligations:

1. Applicability: All companies, including private, public, and one-person companies (OPCs), except government Companies, are required to file the DPT-3 form.
2. Purpose: The purpose of filing DPT-3 is to provide information about outstanding loans or money that a company has, excluding those classified as deposits.
3. Secured and Unsecured Outstanding Money: Companies need to report both secured and unsecured outstanding money or loans that are not considered deposits as of the specified date.
4. Reporting Period: The reporting period for outstanding loans or money is from April 1, 2022, to March 31, 2023. Companies need to provide details of the amounts outstanding during this period.
5. Inclusion of Holding/Subsidiary/Associate Company Loans: Companies are also required to file the DPT-3 form if they have outstanding loans or money taken from their holding, subsidiary, or associate company.

Q. What details are required in DPT-3 and are fees applicable?

The DPT-3 form is a crucial reporting requirement for companies in India regulated under the Ministry of Corporate Affairs (MCA). It serves as a means for companies to provide comprehensive information about their outstanding loans and borrowings. The form includes several fields that require companies to furnish detailed data regarding the loans, such as the amount borrowed, the terms and conditions of the loan, and the entity or individual from whom the loan was received.

Compliance with the DPT-3 filing requirement is mandatory for companies under the MCA's jurisdiction. By adhering to this requirement, companies demonstrate their commitment to transparency and regulatory compliance. It is essential for companies to fulfill this obligation within the specified timeline to ensure they meet the regulatory guidelines set forth by the MCA.

Non-compliance with the DPT-3 filing requirement pursuant to Rules 16 and 16A of the Companies (Acceptance of Deposits) Rules, 2014. can lead to penalties and other legal consequences. Therefore, it is in the best interest of companies to diligently complete and submit the form to the MCA within the stipulated timeframe. By doing so, companies can maintain good standing with regulatory authorities and ensure that their financial activities are in accordance with the applicable laws and regulations.

Fees is totally subject to the Capital of the Company-

Penal Provision - According to the Companies Act, 2013, if a company or any of its officers fail to comply with the filing requirement of Form DPT-3 or commit any default related to the filing, they can be subjected to penalties-

1. Fine for the Company: The company itself can be fined an amount that may extend up to five thousand rupees.
2. Fine for Officers in Default: The officers of the company who are responsible for the default can also be fined an amount that may extend up to five thousand rupees.
3. Additional Fine for Continuing Contravention: If the contravention or default is a continuing one, i.e., it persists beyond the first day, then a further fine may be imposed. This additional fine can be up to five hundred rupees for each day after the first day during which the contravention continues.

These penalties are intended to ensure compliance with the filing requirements and regulations under the Companies Act, 2013. For companies and their officers to fulfil their obligations, including the timely and accurate filing of Form DPT-3, to avoid such penalties and maintain compliance with the law.

Q. Which companies are not required to file DPT-3?

• If a company does not accept any form of loan, it is not obligated to file DPT-3.
• Government companies are exempt from filing DPT-3.
• If a company has fully repaid all its loans prior to closure date 31.03.2023, it does not need to file DPT-3.
• Banking companies, including commercial banks and financial institutions engaged in banking activities, are not required to file DPT-3.
• NBFCs, which are financial institutions that provide banking services without holding a banking license, do not need to file DPT-3.
• Companies specifically classified as housing finance companies are exempt from filing DPT-3.
• The MCA may provide exemptions for certain categories of companies from filing DPT-3, as notified from time to time.

Note: Companies should review the specific criteria and exemptions mentioned in the Companies (Acceptance of Deposits) Rules to determine if they are required to file DPT-3 based on their individual circumstances.

Q. What is an Exempted Deposit but required to file DPT-3 ?

Some transactions are enlisted in Rule 2(1)(c) which required one time Reporting in DPT-3. Rule 2(1)(c) provides a definition for the term 'deposit' and lists 19 transactions that are excluded from being classified as deposits. These transactions, subject to certain conditions and exceptions, are as follows:-

a.????Amounts received from the central government, state governments, etc.

b.????Amounts received from foreign governments, banks, etc.

c.????Loans received from banks, banking companies, etc.

d.????Loans received from Private Finance Institutions (PFIs), regional financial institutions, insurance companies, or scheduled banks.

e.????Amounts raised through the issuance of commercial paper.

f.?????Inter-corporate deposits.

g.???Subscription money received for securities pending allotment.

h.???Amounts received from directors or relatives of directors in the case of a private company.

i.?????Amounts raised by issuing secured bonds or debentures.

j.?????Amounts raised through the issuance of unsecured listed Non-Convertible Debentures (NCDs).

k.????Non-interest bearing security deposits received from employees.

l.?????Non-interest bearing amounts held in trust.

m.??Advances from customers.

n.???Amounts brought in by the promoters.

o.????Any amount accepted by a Nidhi company.

p.????Amounts received by way of subscription in respect of a chit.

q.????Amounts received by the company under any collective investment scheme.

r.?????Amounts received by a start-up company through convertible notes.

s.????Amounts received from Alternate Investment Funds (AIFs), Venture Capital Funds (VCFs), Real Estate Investment Trusts (REITs), etc.

Q. What are the details and documents required for filing DPT-3?

1. Financial statements for the year ended 31.03.2023: Companies filing DPT-3 for the year 2023 may need to refer to their financial statements, including the Balance Sheet and financials, to obtain the necessary data such as the total Net Worth and outstanding amounts. These figures provide relevant statistics required for reporting in the DPT-3 form.
2. Auditor's certificate: The requirement for an auditor's certificate depends on the purpose of filing DPT-3. If the company is filing DPT-3 to disclose outstanding loans, the auditor's certificate is not mandatory. Many times, if the purpose of filing is to disclose deposits held by the company, an auditor's certificate may be compulsory which is subject to MCA query.
3. Trust deed copy: If a company has a trust deed, and if the details of the trust deed are disclosed in the DPT-3 form, then it is mandatory to attach a copy of the trust deed.
4. Instrument creating charge (CHG-1) copy: If a company has created a charge (CHG-1), and the details of the charge are disclosed in the DPT-3 form, then it is mandatory to attach a copy of the instrument creating the charge (Mortgage Deed etc.).
5. Depositors List: If the company has outstanding deposits at the end of the year, it is mandatory to provide a list of all matured deposits and cheques issued but pending separately in the DPT-3 form, list helps provide a comprehensive overview of the company's deposit-related activities.
6. Details of assets: If a company has deposits maturing before the next two financial years (i.e., before March 31 of the following year and the year after that), it is required to provide details of these assets in the DPT-3 form. This information helps in capturing the company's assets related to deposits.

Q. What is called Return of Deposit ?

The "Return of deposits" or "Particulars of transactions by a company not considered as deposit as per Rule 2(I)(c) of the Companies (Acceptance of Deposit) Rules, 2014" is a filing that companies are required to make. It involves disclosing the details of deposits accepted by the company as well as providing information about any transactions that do not qualify as deposits under Rule 2(I)(c) of the Companies (Acceptance of Deposits) Rules, 2014. This return ensures compliance with the rules and regulations related to accepting deposits by the company.

Q. What is the due date and who will sign the form DPT-3

According to the Companies (Acceptance of Deposits) Rules, a company (other than a government company) is required to file the return of deposits in the webform DPT-3 with the Registrar of Companies (RoC) on or before the 30th day of June every year. This return should include all the necessary information as of the 31st day of March of that year, and it not required to get audited by the company's auditor, company can provide the data on the basis of last audited figures except outstanding loan/transactions as on 31 March of the financial year for which form is filing. It should be filed within ninety days from March 31, 2019, along with the required fee as specified in the Companies (Registration Offices and Fees) Rules, 2014.To digitally sign the e-form DPT-3, the relevant individuals, such as directors, managers, CEOs, CFOs, or company secretaries, must possess valid Digital Signature Certificates (DSC). These DSCs ensure the authenticity and integrity of the digitally signed form.

Conclusion-

Compliance Calendar ? also shared an article on how Form DPT-3 filing has become an integral part of corporate compliance in India, requiring companies to provide comprehensive details about their outstanding loans and borrowings.

By embracing this regulatory obligation and understanding its implications, companies can navigate the compliance landscape with confidence, ensuring adherence to the MCA's guidelines, and maintaining a strong foundation for transparency and financial accountability.