By CA Surekha S Ahuja
Part 2 of our DPT-3 compliance series
Read Part 1: Form DPT-3 for FY 2025–26: The Ultimate Practical Filing Guide
Filing Form DPT-3 is not the end of the compliance exercise. The more difficult situation often arises later: the filed form does not agree with the books, the auditor identifies a different balance, a receipt has been incorrectly treated as an excluded transaction, or the company discovers that an amount reported as a loan may actually fall within the definition of a deposit.
What should the company do then?
Can a completed DPT-3 be revised? Does a mismatch automatically attract a penalty? Can a company regularise an incorrectly classified receipt by filing another form? What should directors do when the error is discovered after the financial statements have been approved?
These are not merely filing questions. They require a distinction between a reporting error, an accounting error and a substantive violation of the Companies Act, 2013.
This article deals with that distinction and provides a practical corrective-action framework.
1. First establish what DPT-3 was required to report
Section 2(31) of the Companies Act, 2013 defines a deposit broadly to include a receipt of money by way of deposit, loan or in any other form, subject to the exclusions prescribed under the Rules.
Rule 2(1)(c) of the Companies (Acceptance of Deposits) Rules, 2014 specifies transactions that are not treated as deposits, subject to the conditions applicable to each category.
Rule 16 requires every company to which the Rules apply, other than a Government company, to file Form DPT-3 with the Registrar by 30 June, reporting the relevant position as at 31 March. The Rules do not apply to specified categories such as banking companies, RBI-registered NBFCs and registered housing finance companies, subject to the terms of Rule 1.
Form DPT-3 is used for:
Return of deposits;
Particulars of transactions not considered deposits under Rule 2(1)(c); or
Both categories, where applicable.
The form is therefore not simply a statement of loans appearing in the balance sheet. It is a statutory return based on the legal character of the underlying receipts.
A company should not assume that a receipt is outside the deposit provisions merely because it is described in the ledger as a loan, advance, security deposit, share application money or director contribution.
The legal test is the nature of the receipt, the identity and status of the person from whom it was received, the purpose, the applicable exclusion and whether the conditions of that exclusion have been satisfied.
2. The first corrective step: reconcile the return with the underlying transactions
When a discrepancy is identified, do not immediately prepare another DPT-3. First establish the correct position.
The reconciliation should cover:
The filed DPT-3, its attachments, SRN and MCA filing status.
The trial balance and relevant general ledger accounts.
Bank statements and transaction-wise receipts and repayments.
The audited financial statements and notes to accounts.
Loan agreements, declarations, Board approvals and other supporting documents.
The legal basis for treating each receipt as a deposit or as an excluded transaction.
Prepare a transaction-wise reconciliation showing the opening balance, receipts during the year, repayments, adjustments and closing balance as at 31 March.
Common discrepancies and the appropriate response
| Discrepancy identified | What must be verified | Corrective action |
|---|---|---|
| DPT-3 does not agree with the ledger | Whether an account was omitted, duplicated, netted off or incorrectly classified | Identify the source of difference and prepare a transaction-wise reconciliation |
| A loan is reported as not a deposit | Whether the lender and transaction qualify under the specific Rule 2(1)(c) exclusion | Re-examine the exclusion and retain supporting evidence |
| Director's or relative's money is omitted | Status of the person on the date of receipt, company type and required declaration | Verify the exclusion conditions and applicable disclosures |
| Share application money remains outstanding | Whether the offer complied with the Act, allotment was completed within the prescribed period or refund was made | Examine the offer, allotment records and 60-day/15-day statutory timeline |
| Customer advance remains unadjusted | Whether it relates to supply of goods or services and whether the prescribed time limit or exception applies | Check the contract, supply position, adjustment and any legal proceedings |
| Repayment occurred after 31 March | Actual balance outstanding on the reporting date | Report the 31 March position correctly and document the subsequent repayment separately |
| DPT-3 differs from the audited financial statements | Whether the two records contain an error or reflect different statutory reporting requirements | Resolve the accounting and legal classification issues independently |
| Auditor's declaration or supporting evidence is missing | Applicable Form DPT-3 requirements and nature of the reported transaction | Obtain the required declaration or supporting documentation and determine the appropriate filing action |
A particularly important point concerns year-end cut-off. If a company had an outstanding liability of ₹50 lakh on 31 March and repaid it on 15 April, the repayment does not retrospectively reduce the 31 March balance to nil. The subsequent repayment should be documented separately.
3. Can a company revise a completed DPT-3?
This is one of the most important practical questions.
The Companies (Acceptance of Deposits) Rules, 2014 prescribe the annual filing obligation. The MCA's DPT-3 Instruction Kit explains the initial submission and resubmission process. However, the Rules and the published instruction kit do not establish a general statutory revision facility for every completed DPT-3.
A company must therefore distinguish between a form returned for resubmission and a form that has already been completed and taken on record.
What should the company do?
Situation A: The form is pending or has been marked for resubmission
Follow the resubmission instructions communicated through the MCA system. Correct the specified fields and attachments, verify the revised particulars and complete the process within the permitted period.
Retain the original submission, resubmission remarks, corrected documents and final acknowledgement.
Situation B: The form has been completed, but a clerical or reporting error is discovered
Do not assume that filing another DPT-3 will automatically replace the earlier return.
The company should:
Preserve the filed form, SRN, attachments and acknowledgement.
Prepare a written reconciliation identifying the exact error.
Establish the correct reporting position and the reason for the discrepancy.
Obtain appropriate professional advice on the available MCA/Registrar route.
Make a documented representation through the applicable MCA/ROC channel where required.
Retain the correspondence and evidence of corrective action.
The company should not describe a fresh filing as a revised return unless the applicable MCA process specifically permits it.
Situation C: The error concerns the legal classification of a receipt
A correction to the reported figure is not sufficient if the underlying transaction was incorrectly treated as outside the definition of deposit.
The company must first determine whether the receipt actually qualifies for an exclusion under Rule 2(1)(c). If it does not, the company must assess the consequences under Chapter V of the Act and the applicable Rules.
Situation D: The books or financial statements are also incorrect
A DPT-3 correction does not correct the accounting records. The company must separately examine the applicable accounting standards, company-law requirements, audit implications and the procedure for correcting the financial statements, where necessary.
Important: The MCA Instruction Kit also cautions against filing another DPT-3 for the same financial year. A duplicate annual filing should not be used as an assumed correction mechanism.
4. The critical legal distinction: reporting error versus unlawful acceptance of deposits
A DPT-3 discrepancy does not automatically mean that the company has violated the deposit provisions. Equally, a correctly completed form does not make an otherwise unlawful receipt legal.
The relevant provisions must be examined according to the facts.
| Provision | Legal subject | When it becomes relevant |
|---|---|---|
| Section 2(31) | Definition of deposit | To determine whether a receipt is a deposit under the Act |
| Rule 2(1)(c) | Exclusions from the definition of deposit | To establish whether a particular receipt qualifies for an exclusion and whether its conditions are satisfied |
| Sections 73 and 76 | Acceptance of deposits by companies and eligible public companies | Where the receipt is legally a deposit and the company must establish whether it was permitted to accept it |
| Section 74 | Deposits accepted before commencement of the Companies Act, 2013 | For the relevant legacy deposits and statutory repayment requirements; not as a general route to regularise fresh receipts |
| Section 76A | Punishment for contravention of section 73 or section 76 | Where deposits have been accepted contrary to the prescribed manner or conditions, or repayment obligations have not been met |
| Rule 16 | Annual DPT-3 filing | For the reporting obligation and filing requirements |
| Rule 16A | Specified disclosures in financial statements | For disclosure of money received from directors and, in the case of private companies, relatives of directors |
| Rule 21 | Residual punishment for contravention of the Deposit Rules | Where the relevant Rules are contravened and no punishment is provided in the Act |
| Sections 447 and 448 | Fraud and false statements | Only where the statutory ingredients of fraud or a knowingly false statement are established |
Do not apply Section 76A mechanically
Section 76A is not a general penalty provision for a wrong figure in DPT-3.
It addresses a company accepting, inviting or permitting deposits in contravention of the manner or conditions prescribed under section 73 or section 76 or the Rules made thereunder, or failing to repay deposits or interest within the prescribed time.
The consequences are serious. Under the current provision:
Company: In addition to repayment of the deposit and interest, a fine of not less than ₹1 crore or twice the amount of deposit accepted, whichever is lower, and which may extend to ₹10 crore.
Officer in default: Imprisonment which may extend to seven years and fine of not less than ₹25 lakh, which may extend to ₹2 crore.
The proviso to section 76A further provides for action under section 447 where it is proved that the officer knowingly or wilfully contravened the provisions with the intention to deceive the company, shareholders, depositors, creditors or tax authorities.
Thus, a typographical error and an unlawful deposit transaction must never be treated as the same legal event.
Rule 21 is not an automatic penalty for every mismatch
Rule 21 provides a residual penalty where a company referred to in section 73(2), an eligible company inviting deposits or another person contravenes a provision of the Deposit Rules for which the Act does not provide a punishment.
The prescribed fine may extend to ₹5,000, with a further fine that may extend to ₹500 for every day after the first day during which a continuing contravention continues.
Its application requires examination of the exact Rule contravened, the person covered by the provision and whether the Act provides a specific punishment. It should not be presented as an automatic penalty for every DPT-3 discrepancy or delay.
5. Excluded transactions: the evidence must support the classification
A substantial part of DPT-3 risk arises not from missing figures but from incorrect reliance on exclusions under Rule 2(1)(c).
Some common examples deserve particular attention.
A. Money received from directors and relatives
The exclusion applies to money received from a person who, at the time of receipt, was a director of the company. It also covers money received from a relative of a director of a private company.
However, the prescribed written declaration must be furnished at the time of giving the money, confirming that the amount is not being given out of funds acquired by borrowing or accepting loans or deposits from others. The company is also required to disclose the details of money so accepted in its Board's Report.
The company should retain:
Proof of the person's status on the date of receipt;
The written declaration obtained at the time of giving the money;
Bank evidence establishing the receipt; and
The relevant Board's Report and financial-statement disclosures.
A declaration obtained much later should not casually be treated as proof that the prescribed condition was fulfilled at the time of receipt.
B. Share application money and advances towards securities
The exclusion applies to money received pursuant to an offer made in accordance with the Act towards subscription to securities, including share application money or advance towards allotment, provided the amount is appropriated only against the amount due on allotment.
The Rules provide a specific timeline:
Securities should be allotted within 60 days from receipt of the application money or advance.
If allotment cannot be made, the money should be refunded within 15 days from completion of the 60-day period.
If it is not refunded within that further period, the amount is treated as a deposit under the Rules.
Adjustment of the money for another purpose is not treated as a refund.
The company should examine the offer documents, allotment records, approvals, refund evidence and statutory timeline. An amount cannot be retained indefinitely under the label of share application money.
C. Business advances
Advances received in the course of business are not automatically excluded merely because they are described as customer advances.
For an advance for supply of goods or provision of services, the prescribed condition generally requires appropriation against the supply within 365 days from the date of acceptance. The time limit does not apply where the advance is the subject matter of legal proceedings before a court of law.
Other categories, including advances relating to immovable property, contract-performance security deposits and advances under long-term projects for supply of capital goods, have their own conditions.
The company should maintain a separate ageing analysis of customer advances, supported by contracts, purchase orders, invoices, supply records and correspondence.
D. Inter-corporate loans
Amounts received by a company from another company are covered by a specific exclusion under Rule 2(1)(c).
However, the company should still examine other legal requirements that may apply to the transaction, including the provisions governing inter-corporate loans, investments and guarantees under section 186, where relevant.
An exclusion under the Deposit Rules does not mean that every other company-law or regulatory requirement disappears.
6. Financial statements and auditor declaration: the second level of compliance
The DPT-3 reconciliation should not end with the filing record. The company must also check whether the underlying accounting and disclosures are correct.
Particular attention should be given to:
Correct classification of deposits, borrowings, advances and other liabilities;
Outstanding balances and repayment terms;
Interest accrued or payable;
Related-party disclosures, where applicable;
The disclosures required under Rule 16A;
Prior-period errors and subsequent events; and
Provisions or contingent-liability disclosures under the applicable accounting framework.
Rule 16A requires:
Every company other than a private company to disclose, by way of notes to its financial statements, money received from a director.
Every private company to disclose, by way of notes to its financial statements, money received from its directors or relatives of directors.
The company should verify the applicable disclosure and ensure that the note is not omitted merely because the amount has been reported in DPT-3.
Auditor's declaration under the 2022 amendment
The Companies (Acceptance of Deposits) Amendment Rules, 2022, notified through G.S.R. 663(E) dated 29 August 2022, amended Rule 16 to require the auditor's declaration to that effect in Form DPT-3.
The prescribed declaration in the form relates to the correctness of the amounts specified under Particulars of Deposits and Particulars of Liquid Assets. It should not be expanded by assumption into a blanket certification of every transaction reported as not considered a deposit.
The company should ensure that the auditor's declaration is obtained in the prescribed form and that the figures covered by it are supported by the relevant records.
Illustrative explanatory note
Where a material discrepancy has been identified and the company has completed its review, an explanatory note may be considered, suitably adapted to the facts and accounting requirements:
During the review of the particulars reported in Form DPT-3 for the year ended 31 March [year], the Company identified a difference of ₹[amount] relating to [brief description of transaction]. The Company has undertaken a transaction-wise reconciliation and examined the legal classification and accounting treatment of the relevant amount. Based on the outcome of this review, the Company has taken or is taking the appropriate corrective action in accordance with the applicable provisions of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.
This is only an illustrative disclosure. It should not be used to conceal an established liability, avoid a required provision or imply that a legal contravention has been cured merely because a reconciliation has been undertaken.
7. What should directors do when an error is discovered?
Directors should not leave the matter entirely to the accounts department or assume that the auditor's involvement transfers their statutory responsibilities.
A practical response should follow a documented sequence.
| Step | Action required | Evidence to retain |
|---|---|---|
| 1. Secure the filing record | Download the completed DPT-3, attachments, SRN and acknowledgement | Filed form and MCA records |
| 2. Quantify the difference | Reconcile the reported balance with the books and bank records | Transaction-wise reconciliation |
| 3. Establish legal classification | Identify the precise exclusion or deposit provision applicable | Agreements, declarations, approvals and legal analysis |
| 4. Review accounting treatment | Check the ledger, financial statements and relevant notes | Accounting reconciliation and proposed adjustments |
| 5. Assess substantive exposure | Examine whether deposits were accepted or retained contrary to law | Receipt and repayment history, statutory analysis |
| 6. Determine the corrective route | Distinguish resubmission from a completed filing and seek appropriate MCA/ROC guidance | Correspondence and professional advice |
| 7. Record management action | Place material issues before the appropriate authority and document the decision | Board or authorised-management records, as appropriate |
| 8. Prevent recurrence | Introduce a pre-filing review and transaction-classification control | Approved compliance checklist and sign-off |
Where the issue reveals a substantive contravention, the company should obtain specific legal advice on the available statutory remedies and obligations. It should not assume that a fresh DPT-3, a journal entry or a Board resolution can retrospectively validate an unlawful acceptance of deposits.
8. A three-level control system for future DPT-3 filings
The most effective way to avoid recurring discrepancies is to make DPT-3 a coordinated compliance exercise rather than a last-minute form-filing activity.
Finance team
Maintain separate ledger mapping for deposits and transactions claimed to be excluded.
Reconcile opening balances, receipts, repayments and closing balances.
Maintain ageing of business advances and outstanding share application money.
Obtain confirmations and supporting documents before year-end.
Company Secretary
Verify the applicability of the Deposit Rules.
Review the legal classification and supporting declarations.
Check Rule 16, Rule 16A and the relevant Form DPT-3 requirements.
Verify the filing purpose, attachments, approvals and MCA status.
Auditor
Examine the relevant balances and supporting records.
Review the auditor's declaration and reporting requirements under the amended Rule 16.
Communicate material discrepancies and unresolved classification issues to management.
The company should retain a joint sign-off confirming that the books, statutory classification, financial-statement disclosures and DPT-3 particulars have been reviewed.
9. Five mistakes that can make the problem worse
Do not file another DPT-3 casually. First establish whether the original filing is pending, returned for resubmission or completed.
Do not change the year-end balance to reflect a later repayment. The reporting date remains 31 March.
Do not rely on ledger descriptions. The legal character of a receipt is determined by the Act and Rules.
Do not treat a disclosure as a cure. Reporting a transaction does not regularise an acceptance that contravened the law.
Do not label every mistake as fraud—or dismiss every mistake as harmless. The legal consequences depend on the actual facts, statutory ingredients and conduct of the persons concerned.
Casahuja Perspective
A DPT-3 mismatch is not necessarily a deposit violation. But an unexplained mismatch can expose a deeper weakness in the company's financial controls and statutory compliance.
The important question is not merely whether the form was filed on time. It is whether the company can establish, transaction by transaction, what money it received, from whom, under which legal provision, on what conditions and with what outstanding liability at the reporting date.
If the error is clerical, correct the record through the appropriate route. If the accounting is wrong, correct the accounting. If the legal classification is wrong, address the underlying transaction and its statutory consequences.
The safest DPT-3 is not the one that merely gets accepted on the MCA portal. It is the one whose every material figure and legal classification can withstand scrutiny.
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