The Banning of Unregulated Deposit Scheme Bill 2019 was passed by Lok Sabha but could not be passed by Rajya Sabha to make it as an enacted Act. Hence, to make the provisions effective immediately the Ordinance was promulgated by Hon’ble President of India on 21st February 2019 and is applicable from that date onwards.
The Ordinance is to provide for a comprehensive mechanism to ban Unregulated Deposit Schemes and to protect the interest of the depositors and for matters connected therewith or incidental thereto.
Section 2(4) of the Ordinance defines the term deposit as an amount of money received by way of an advance or loan or in any other form, by any deposit taker with a promise to return whether after a specified period or otherwise, either in cash or in kind or in the form of a specified service, with or without any benefit in the form of interest, bonus, profit or in any other form.
However, certain deposits are excluded from the definition and as such the excluded deposits are not within the scope of the Ordinance.
Please click here for FAQs on the Banning of Unregulated Deposit Schemes Ordinance, 2019.
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