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Explain the following term/concept.Deposit Trustee

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Question

Explain the following term/concept.
Deposit Trustee

Short/Brief Note
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Solution

(1) Every company inviting deposits under section 73, of Companies Act 2013, shall appoint deposit trustees for creating security for its deposits, which shall be mentioned on the circular. Written consent shall be obtained from the trustee before their appointment.
(2) A deposit trust deed has to be signed at least 7 days before the issue of the circular. Deposit trustees cannot be removed after the issue of circular / advertisement and before the expiry of his term except with unanimous consent of all directors present at the meeting of the Board, which shall include an independent director if any.

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Terms and Conditions for Acceptance of Deposits
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Chapter 5: Deposits - Exercises [Page 91]

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