TOPIC 39: QUICK REFERENCE TO “When Debentures Considered as Deposits”

.
Quick Reference to "When Debentures Considered as Deposits"
.
Points:-
.
1. Secured Compulsorily Convertible Debentures,
Secured Optionally Convertible Debentures,
Secured Non-Convertible Debentures
Will not be Considered as Deposits👆
.
2. Unsecured Compulsorily Convertible Debentures and Unsecured Optionally Convertible Debentures and Unsecured Non-Convertible Debentures issued to Company is not Considered as Deposits.
.
3. Unsecured Compulsorily Convertible Debentures issued to resident not considered as Deposits if convertible within 10 years.
.
4. Unsecured Optionally Convertible Debentures and Unsecured Non-Convertible Debentures issued to resident Considered as Deposits unless it is listed on stock exchange.
.
5. Unsecured Optionally Convertible Debentures and Unsecured Non-Convertible Debentures issued to Foreign body Not Considered as Deposits.
.
*Note:-
Secured Debentures are secured by charges i.e. based on assets.
Unsecured Debentures are not secured because no charge is created.
.
.
Regards
ACA SOURAV BAGARIA