Where should the application money be deposited by prospective investors?

A scheduled bank specified in the prospectus

The prospective investors intending to subscribe to the share capital of the company need to make an application along with the application money. This money should be deposited with a scheduled bank as specified in the prospectus. A "scheduled bank" refers to a bank that is included in the Second Schedule of the Reserve Bank of India Act, 1934, and is eligible to conduct banking operations in India. The requirement to deposit the application money with a scheduled bank specified in the prospectus helps ensure transparency, accountability, and proper management of the funds collected from potential investors. It also adds a level of regulation and oversight to the process, as specified banks are subject to regulatory standards set by the central bank (in this case, the Reserve Bank of India).