Form DPT-3: Why You Must File Even for Intercompany Loans

Why Intercompany Loans Trigger DPT-3 Filing

A Ministry of Corporate Affairs (MCA) notification dated 22 January 2019 introduced Rule 16A, requiring every company to file Form DPT-3 reporting not just deposits but also all outstanding amounts that are classified as non-deposits — including intercompany loans from holding companies, subsidiary companies, and associate companies. The logic is straightforward: MCA wants visibility into every form of money or loan received by companies, regardless of whether it qualifies as a deposit.

This trips up many CFOs and company secretaries, because intercompany loans — whether structured as external commercial borrowings (ECBs) or domestic intercompany advances — are specifically excluded from the definition of "deposits" by Rule 2(1)(c) of the Companies (Acceptance of Deposits) Rules, 2014, which carves out (among other receipts) amounts received from any other company and amounts received from a person resident outside India in accordance with FEMA. Stopping the analysis there and concluding that no DPT-3 filing is necessary is the wrong conclusion: Rule 16A's reporting requirement applies regardless.

For wholly-owned subsidiaries of foreign companies, this means every intercompany loan, advance, or credit facility outstanding as of 31 March must be reported in the annual DPT-3 return filed with the Registrar of Companies.

What Exactly Must Be Reported in DPT-3

Form DPT-3 captures three categories of outstanding amounts:

• Deposits: Amounts received that qualify as deposits under Sections 73 to 76 of the Companies Act, 2013
• Amounts not considered deposits: Every receipt excluded from the deposit definition by Rule 2(1)(c) — intercompany loans from holding, subsidiary and associate companies sit here, alongside bank and financial-institution loans, secured debentures and share application money pending allotment

For a typical foreign-owned Indian subsidiary, the most common items to report include:

Amounts Received Under FEMA

A frequently debated question is whether amounts received by an Indian company from a foreign company under FEMA regulations require DPT-3 reporting. The answer follows from the rules themselves: Rule 2(1)(c) takes such amounts outside the definition of a deposit, and Rule 16A then requires them to be reported in DPT-3 precisely because they are not deposits. This applies to ECBs, trade credits, and any other cross-border loan governed by FEMA/RBI regulations.

One-Time Return vs. Annual Return

DPT-3 has two distinct filing types, and understanding the difference prevents filing the wrong form:

One-Time Return (Rule 16A(3))

This was a one-off requirement covering outstanding receipts from 1 April 2014 to 31 March 2019. The deadline was 29 June 2019 (90 days from 31 March 2019). If your company missed this, the return can still be filed with additional fees, though the Registrar may issue a notice.

Annual Return (Rule 16)

This is the recurring annual filing covering all outstanding deposits, exempted deposits, and non-deposits as of 31 March of each financial year. The annual return must be filed by 30 June of every year. For FY 2025-26, the due date is 30 June 2026.

Where the return covers deposits, an auditor's certificate is a mandatory attachment to the form. Where the return reports only amounts not considered deposits, the standard practice is still to have the statutory auditor verify the classification of every amount before the form is filed — the classification is what the ROC scrutinises.

Step-by-Step Filing Process on MCA V3 Portal

DPT-3 is filed on the MCA V3 portal. Here is the current procedure:

1. Board resolution: Hold a board meeting to authorize the filing and designate the signing authority. Ensure the resolution specifically covers the DPT-3 return for the relevant financial year.
2. Data reconciliation: Reconcile all intercompany loan balances, bank loans, debentures, and other outstanding amounts. Cross-check against the balance sheet and loan agreements.
3. Auditor certification: Share the draft DPT-3 data with the statutory auditor. An auditor's certificate is a mandatory attachment where the return covers deposits, and is standard practice in every case.
4. Portal access: Log in to www.mca.gov.in using Business User credentials. Navigate to MCA Services > Filing > Company Forms > DPT-3.
5. Form completion: Enter the CIN, select "Annual Return" as the return type, and fill in each category: deposits accepted/outstanding, exempted deposits outstanding, and particulars of non-deposit loans outstanding.
6. Document upload: Attach the auditor's certificate in PDF format (digitally signed).
7. DSC and payment: Affix the Digital Signature Certificate (DSC) of the authorized signatory. Pay the prescribed filing fee, which is set on a sliding scale by the company's nominal share capital under the Companies (Registration Offices and Fees) Rules, 2014; an additional fee applies to a delayed filing.
8. Confirmation: Upon successful submission, you receive a Service Request Number (SRN) and email confirmation from the ROC.

Penalties for Non-Filing or Late Filing

The penalty structure for DPT-3 non-compliance is severe and operates at two levels:

Section 76A Penalties (only where deposits were actually accepted in contravention)

Section 76A of the Companies Act, 2013 punishes a company that accepts deposits in contravention of Section 73 or Section 76, or that fails to repay them. It is not the penalty for missing a DPT-3 filing — it bites when an amount the company treated as exempt turns out to be a deposit taken without complying with the deposit rules.

• Company: fine of not less than INR 1 crore or twice the amount of deposits accepted, whichever is lower, extending to INR 10 crore
• Every officer in default: imprisonment up to 7 years and fine of INR 25 lakh to INR 2 crore

Rule 21 Penalties (for filing-related non-compliance)

• Company and every officer in default: Fine up to INR 5,000
• Continuing contravention: Additional INR 500 per day of default

While Rule 21 penalties appear modest, the real risk lies in the Section 76A exposure that a misclassification can create, and in the reputational damage from MCA notices. The ROC has increasingly issued show-cause notices to companies that skip DPT-3 filings, and these notices appear on the company's MCA master data record, visible to anyone conducting due diligence on the company.

Common Mistakes Foreign-Owned Subsidiaries Make

Based on our experience with hundreds of annual compliance filings for foreign-owned companies, these are the most frequent DPT-3 errors:

1. Omitting Intercompany Loans Entirely

The most common mistake. The company secretary reports bank loans and debentures but excludes the intercompany loan from the parent company, assuming it is exempt from reporting. As explained above, exempted deposits must still be reported.

2. Misclassifying Loan Categories

An intercompany loan belongs in the "particulars of transactions not considered as deposits" part of the form under Rule 2(1)(c), described by the correct limb of that rule — a loan from a foreign parent under the FEMA limb, a loan from an Indian group company under the "amount received from any other company" limb. Incorrect classification can trigger queries from the ROC and require a revised filing.

3. Missing the Auditor Certification

Where the return covers deposits, the auditor's certificate is a mandatory attachment and filing without it renders the return defective. Even where only amounts not considered deposits are reported, an unverified classification is the single most common trigger for an ROC deficiency notice.

4. Filing After the Deadline Without Additional Fees

The MCA V3 portal calculates additional fees automatically for delayed filings. However, some companies attempt to file at the normal fee rate, resulting in rejected submissions. For DPT-3 the additional fee is a multiple of the normal filing fee that rises with the length of the delay, up to 12 times the normal fee — not the flat INR 100 per day that applies to the annual filings under Sections 92 and 137.

5. Not Reconciling ECB Balances with RBI Filings

Companies that have ECBs must ensure the outstanding balance reported in DPT-3 matches the amount reported in the FLA return filed with the RBI and the FC-GPR/ECB-2 filings. Discrepancies between MCA and RBI filings invite scrutiny from both regulators.

Documents Required for DPT-3 Filing

Having all documents ready before initiating the filing prevents delays and rejected submissions. Here is the complete document checklist:

• Board resolution: Authorizing the filing of DPT-3 and nominating the signing authority (director or company secretary)
• Loan agreements: Copies of all intercompany loan agreements, ECB agreements, bank loan sanction letters, and debenture trust deeds
• Balance sheet extract: Audited or provisional balance sheet showing the outstanding loan balances as of 31 March
• Auditor's certificate: The statutory auditor's certification of the DPT-3 data, digitally signed in PDF format (mandatory where the return covers deposits)
• Interest rate documentation: Details of interest rates charged on each loan, particularly important for intercompany loans that must comply with transfer pricing and ECB all-in-cost ceiling requirements
• RBI filings: Copies of ECB-2 returns and FLA returns for cross-verification of outstanding amounts
• Maturity schedule: Repayment dates for each outstanding loan, which must be disclosed in the form

DPT-3 for LLPs and Other Entities

A critical distinction: Limited Liability Partnerships (LLPs) are not required to file Form DPT-3. The Companies (Acceptance of Deposits) Rules, 2014, apply only to companies registered under the Companies Act, 2013. LLPs governed by the LLP Act, 2008, have no equivalent filing requirement.

This difference is relevant for foreign companies choosing their India entry structure. If the only intercompany funding mechanism is a loan from the foreign parent, an LLP structure eliminates the DPT-3 filing burden. However, this advantage must be weighed against other factors such as FDI route restrictions and ownership structure limitations that apply to LLPs.

Section 8 companies (not-for-profit companies) are subject to DPT-3 requirements. One Person Companies (OPCs) are also covered. The only exemption is for government companies as defined under Section 2(45) of the Companies Act, 2013.

Interest on Intercompany Loans: Compliance Intersection

The interest component on intercompany loans creates a compliance intersection across multiple regulations that foreign companies must navigate carefully:

RBI All-in-Cost Ceiling

For ECBs, the all-in-cost ceiling has been removed for loans with an average maturity of 3 years or more — cost must simply be in line with prevailing market conditions under the revised ECB framework (FEMA 3(R)(5)/2026-RB, effective 16 February 2026). ECBs with average maturity under 3 years must still meet the Trade Credit ceiling: the benchmark rate (SOFR for USD-denominated loans, EURIBOR for EUR-denominated loans) plus 300 basis points (foreign currency) or plus 250 basis points (rupee-denominated). The all-in-cost includes interest, guarantee fees, arranger fees, and any other costs incurred by the borrower. Exceeding the applicable ceiling requires RBI approval and may result in rejection of the ECB application.

Withholding Tax on Interest

Interest paid on intercompany loans from a foreign parent is subject to withholding tax in India, deducted under section 393(2) of the Income-tax Act, 2025 (Table, Sl. No. 17; section 195 of the Income-tax Act, 1961). Where the borrowing is in foreign currency, the domestic rate is 20% plus surcharge and cess (an effective 21.84% for a foreign company on the 5% surcharge slab) under section 207(1) of the Income-tax Act, 2025 (Table, Sl. Nos. 1 to 3; section 115A of the Income-tax Act, 1961). Interest on a rupee-denominated loan falls outside that 20% rate and is taxed at the rates in force — 35% for a foreign company — plus surcharge and cess. Treaty rates cap the charge, but the parent-company tier is not the headline bank rate: the India-US DTAA (Article 11(2)), the India-UK DTAA (Article 12(2)) and the India-Singapore DTAA (Article 11(2)) all cap interest at 15% in the general case and give the 10% rate only where the lender is a bank or similar financial institution — which a parent company is not. The Indian company must deduct TDS before remitting interest and file Form 145 (formerly Form 15CA) with the Income Tax department for each remittance, with a Form 146 (formerly Form 15CB) certificate only for Part C — a taxable remittance above INR 5 lakh in the financial year that is not covered by an Assessing Officer's certificate.

TDS on Interest Between Indian Group Companies

For domestic intercompany loans (between Indian group companies), interest is subject to TDS at 10% under section 393(1) of the Income-tax Act, 2025 (Table; section 194A of the Income-tax Act, 1961) once the payment for the tax year crosses the threshold specified in that entry. The paying company must deduct TDS, deposit it by the 7th of the following month (by 30 April for March deductions), and issue Form 16A to the recipient company.

DPT-3 and Transfer Pricing Implications

For multinational groups, intercompany loans reported in DPT-3 have direct transfer pricing implications. The interest rate charged on an intercompany loan must be at arm's length, typically benchmarked against comparable uncontrolled transactions or the RBI's all-in-cost ceiling for ECBs (removed for maturities of 3 years or more; SOFR/EURIBOR + 300 bps foreign currency / + 250 bps rupee for shorter maturities under the Trade Credit ceiling).

The DPT-3 disclosure of outstanding intercompany loan amounts creates a paper trail that transfer pricing officers can cross-reference with transfer pricing documentation and Form 48 (formerly Form 3CEB) filings. If the interest rate or loan terms disclosed in DPT-3 do not match the transfer pricing study, it can trigger an adjustment.

Companies should ensure consistency across three filings: DPT-3 (MCA), Form 48 (Income Tax), and ECB-2/FLA return (RBI). A dedicated transfer pricing advisory review before the DPT-3 filing deadline helps prevent mismatches.

Practical Timeline for the FY 2025-26 Return (Due 30 June 2026)

What Happens When the ROC Issues a Notice

If your company has missed a DPT-3 filing or filed an incorrect return, the Registrar of Companies may issue a show-cause notice under Section 206(4) of the Companies Act, 2013. The notice typically sets a period in which the company must explain the non-compliance, and can lead to further proceedings if the response is unsatisfactory.

The practical impact of an ROC notice extends beyond the immediate penalty. The notice appears on the company's MCA master data record, which is publicly searchable. Any investor, lender, or business partner conducting due diligence on the company will see the compliance flag. For foreign-owned subsidiaries seeking additional FDI rounds, bank credit facilities, or participation in government tenders, a compliance notice on the MCA record can delay or derail the transaction.

To resolve an outstanding notice, the company must file the overdue DPT-3 with additional fees, submit a detailed response to the ROC explaining the reason for the default, and if necessary, apply for compounding of the offence under Section 441 of the Companies Act. An offence punishable with fine only is compounded by the Regional Director where the maximum fine does not exceed INR 25 lakh, and by the National Company Law Tribunal (NCLT) above that limit, on payment of a compounding fee.

Key Takeaways

• Intercompany loans from holding, subsidiary, and associate companies must be reported in Form DPT-3, even though they are exempt from the definition of deposits
• The annual DPT-3 return is due by 30 June each year, and the statutory auditor's certificate is a mandatory attachment where the return covers deposits
• The filing default itself is penalised under Rule 21 (up to INR 5,000, plus INR 500 per day of continuing default); the INR 10 crore exposure and imprisonment for officers under Section 76A arise only where a receipt turns out to be a deposit accepted outside the deposit rules
• Ensure consistency between DPT-3 (MCA), Form 48 (Income Tax), and ECB-2/FLA return (RBI) to avoid cross-regulatory scrutiny
• File early in June to avoid last-minute portal congestion and auditor scheduling conflicts