Eligible Company explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
The word "eligible" is doing real work — only a small class of company may ask the public for money at all.
The definition
Eligible company refers to every public company having net worth of not less than INR 100 crore rupees or a turnover of not less than INR 500 crore rupees and which has obtained prior consent of shareholders in general meeting by means of a special resolution and made respective filings with the ROC before making any invitation to public.
In case, deposit is with respect to the specified limits under Section 180(1)(c) of the CA, 2013, an ordinary resolution may suffice the requirement.
The definition is not simply a size test. It contains three requirements, and a company must satisfy all of them before approaching the public.
It must be a public company. A private company is excluded by definition — section 2(68) prohibits it from inviting the public to subscribe to its securities, and the same logic runs through the deposit rules. A private company's route is the member deposit exemption, capped at its own capital base.
It must be large. Net worth of not less than INR 100 crore rupees or a turnover of not less than INR 500 crore rupees — alternatives, so either suffices. The thresholds are high because a company soliciting money from the public should have substance behind the promise to repay.
It must have authority in place first. Prior consent of shareholders in general meeting by means of a special resolution and respective filings with the ROC, both before making any invitation to public.
The sequence is the protective element. Shareholder authority and a public filing must exist before a single member of the public is approached — not obtained afterwards to regularise money already collected. That gives both shareholders and the Registrar the chance to intervene while it still matters.
The section 180(1)(c) relaxation addresses overlap. That section governs borrowing beyond the company's paid-up capital and free reserves, which itself requires a special resolution; where the deposit sits within those limits, an ordinary resolution may suffice, so the same approval is not demanded twice at different levels.
The two routes compared
| Private company, member deposits | Eligible company, public deposits | |
|---|---|---|
| Who may give | Members only | The public |
| Size test | None | Net worth INR 100 crore or turnover INR 500 crore |
| Ceiling | 100% of paid-up capital, free reserves and securities premium | As prescribed by the deposit rules |
| Approval | Exemption notification route | Special resolution, plus ROC filings before invitation |
| Section 73(2) machinery | Largely relaxed | Applies |
Why the framework is built this way
Deposit-taking is the activity that most closely resembles banking without the regulation that accompanies it. Depositors are typically individuals with no security, no covenants, and no practical ability to assess the company's solvency.
So the Act permits it only where the company is substantial enough to be credible, the shareholders have authorised it, and the fact is on the public record before any approach is made. Everything else — the member route for private companies, the director declaration, the debenture carve-outs — is defined by reference to people who are not in that position.
Before any invitation
- Confirm public company status.
- Test net worth and turnover against the thresholds.
- Pass the special resolution in general meeting.
- Complete the ROC filings.
- Only then make any invitation to the public.
Common mistakes
- Treating the two eligible company financial tests as cumulative.
- Inviting deposits before the special resolution and filings are complete.
- Assuming a private company can become an eligible company by resolution.
- Relying on the section 180(1)(c) relaxation where the borrowing exceeds those limits.