INDUSTRIAL RECONSTRUCTION BANK OF INDIA ACT, 1984
(1) This Act may be called The Industrial Reconstruction Bank of India Act, 1984.
(2) It shall come into force on such date1as the, Central Government may, by notification in the Official Gazette, appoint, and different dates may be appointed for different provisions of this Act.
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1. Act came into force on 20-3-1985
In this Act, unless the context otherwise requires,--
(a) "appointed day", in relation to any provision of this Act, means the date on which such provision comes into force and any reference to the appointed day in any provision of this Act shall be construed as a reference to the commencement of that provision;
(b) "assistance" means any direct or indirect financial, managerial or technical assistance granted by the Reconstruction Bank in pursuance of any business referred to in section 18;
(c) "assisted industrial concern" means any industrial concern to which any assistance has been given by the Reconstruction Bank;
(d) "Board" means the Board of directors of the Reconstruction Bank;
(e) "charge" inclu
(1) With effect from such date as the Central Government may, by notification in the Official Gazette, appoint, there shall be established, for the purposes of this Act, a corporation, to be known as the Industrial Reconstruction Bank of India.
(2) The Reconstruction Bank shall be a body corporate with the name aforesaid, having perpetual succession and a common seal with power, subject to the provisions of this Act to acquire, hold and dispose of property, and to contract, and may, by that name, sue and be sued.
(3) The head office of the Reconstruction Bank shall be at Calcutta, and the Reconstruction Bank may establish offices, branches or agencies at any other place, whether in, or outside, India.
(1) The authorised capital of the Reconstruction Bank shall be rupees two hundred crores.
(2) The initial paid-up capital of the Reconstruction Bank shall be rupees fifty crores which shall be obtained,--
(a) by the appropriation, out of the assets of the Corporation which stand transferred to the Reconstruction Bank by virtue of the provisions of section 5, of a sum of rupees twenty crores, being an amount equal to the amount paid-up on the shares of the Corporation;
(b) by the conversion, to the extent of rupees twenty crores, of the loans granted by the Central Government to the Corporation, into the capital of the Reconstruction Bank; and
(c) by the subscription, by the Central Government, to the paid up capital of the Reconstruction Bank, of a
1[4A. Transitional Provisions regarding adjustment of capital of the Reconstruction Bank
(1) The Central Government may reduce share capital of the Reconstruction Bank by,--
(a) extinguishing or reducing the liability of any of its equity shares;
(b) either with or without extinguishing or reducing liability on any of its equity shares, cancelling any paid up share capital which is lost, or is unrepresented by available assets; or
(c) either with or without extinguishing or reducing liability on any of its equity shares, paying of any paid up share capital which is in excess of the wants of the Reconstruction Bank.
(2) The Central Government may at any time, by notification in the Official Gazette, conver
(1) On such date as the Central Government may, by notification in the Official Gazette, appoint, the undertaking of the Corporation shall stand transferred to, and shall vest in, the Reconstruction Bank.
(2) For the transfer to, and vesting in, the Reconstruction Bank of the undertaking of the Corporation, the Corporation shall be given, in cash, by the Central Government an amount equal to the amount of the total paid-up capital of the Corporation.
(3) The undertaking of the Corporation shall be deemed to include all assets, business, rights, powers, authorities and privileges and all property, movable and immovable, cash balances, reserve funds, investments, book debts and all other rights and interests in, or arising out of, such property as were, immediately before the appointed day, in the ownership, possession, power or control of
(1) The Central Government may appoint, on or after the appointed day, a suitable person to take over the management of the Corporation for the purpose of winding up of the Corporation, and, where any person is so appointed, it shall be the duty of such person to bring the operations of the Corporation to a close, realise the amounts payable to the Corporation under sub-section (2) of section 5, and distribute the said amount to the shareholders in accordance with their rights and interests, and after such realisation and distribution, to obtain the order of the Central Government for the dissolution of the Corporation.
(2) For the purposes of sub-section f 1), the person appointed under that sub-section shall have such powers and duties of the Official Liquidator under the Companies Act, 1956, as are necessary to give effect to the provisions of sub-section (1) as if the Corporati
(1) Save as otherwise provided in sub-section (3) of section 6, every officer or other employee of the Corporation shall become, on and from the appointed day, an officer or other employee, as the case may be, of the Reconstruction Bank and shall hold his office or service in that bank on the same terms and conditions and with the same rights to gratuity and other matters as would have been admissible to him, if the undertaking of the Corporation had not been transferred to, and vested in, the Reconstruction Bank, and continue to do so unless and until his employment in the Reconstruction Bank is duly terminated or until his remuneration, terms and conditions are duly altered by the Reconstruction Bank :
Provided that an officer or other employee who does not intend to continue as an employee of the Reconstruction Bank may, within ninety days from the appointed day, serve a notice
(1) As soon as realisation and distribution of the amount have been made under section 6, the person appointed under sub-section (1) of that section shall submit his duly audited accounts to the Central Government and shall apply to the Government for orders as to the dissolution of the Corporation.
(2) The Central Government shall, after hearing such person as it may think fit, and upon perusing the accounts so audited, if satisfied that the amount has been realised and distributed in accordance with the provisions of this Act, make an order that the Corporation is dissolved from the date of the order and the Corporation shall stand dissolved accordingly.
(3) A copy of the order made by the Central Government for the dissolution of the Corporation shall be filed by the Reconstruction Bank with the Registrar of Companies within thirty da
(1) The general superintendence, direction and management of the affairs and business of the Reconstruction Bank shall vest in a Board of directors which may exercise all powers and do all acts and things which may be exercised or done by the Reconstruction Bank.
(2) Save as otherwise provided in the regulations made under this Act, the Chairman shall also have powers of general superintendence, direction and management of the affairs and business of the Reconstruction Bank and may also exercise all powers and do all acts and things which may be exercised or done by the Reconstruction Bank.
(3) Subject to the provisions of this Act, the Board, in discharging its functions, shall act on business principles with due regard to public interest.
(4) In the discharge of its functions under this Act,
(1) The Board shall consist of the following, namely:--
(a) a Chairman, to be appointed by the Central Government, who shall function both as the Chairman and as the managing director;
(b) a Deputy Governor of the Reserve Bank, to be nominated by that Bank;
(c) a director, to be nominated by the Development Bank;
(d) not more than fifteen directors to be nominated by the Central Government, of whom --
(i) three shall be officials of the Central Government,
(ii) not more than three shall be from the public financial institutions,
(iii) not more than five shall be from the State Bank, nationalised banks and the State F
No person shall be qualified to be a member of the Board if--
(a) he has been removed or dismissed from service of --
(i) Government, or
(ii) Reserve Bank, State Bank or any other bank, or
(iii) any public financial institution or State Financial Corporation or
(iv) any other corporation owned or controlled by Government on a charge of corruption or bribery, or
(b) he is, or at any time has been adjudicated an insolvent or has suspended payment of his debts or has compounded with his creditors; or
(c) he is a lunatic and stands so declared by a competent court or
(d) he is
(1) The Chairman shall hold office for such term not exceeding five years as the Central Government may specify in this behalf and any person so appointed shall be eligible for re-appointment for a like term.
(2) Notwithstanding anything contained in sub-section (1),--
(a) the Central Government shall have the right to terminate the term of office of the Chairman at any time before the expiry of the term specified under sub-section (1) by giving him notice of not less than three months in writing or three months' salary and allowances in lieu of such notice, and the Chairman shall also have the right to relinquish his office at any time before the expiry of the term specified under sub-section (1) by giving, to the Central Government notice of not less than three months in writing,
(b) the Cen
No member of the Board shall have an interest, direct or indirect, in any business, industry or concern to which any assistance has been given or is to be given by the Reconstruction Bank under this Act and if any such member acquires such interest at any time during the continuance of such assistance, he shall immediately disclose it to the Board and shall either resign his membership of the Board or dispose of his interest in such manner and within such time as the Board may direct.
(1) The Board shall meet at such times and places and shall observe such rules of procedure in regard to the transaction of business at its meetings as may be provided for in the regulations.
(2) If, for any reason, the Chairman is unable to attend any meeting of the Board, any other director nominated by the Chairman in this behalf, and in the absence of such nomination, any director elected by the directors present, from amongst themselves, shall preside at the meeting.
(3) All questions which come up before any meeting of the Board shall be decided by a majority of votes of the directors present and voting, and in the event of an equality of votes, the Chairman, or, in his absence, the person presiding, shall have a second or casting vote.
(4) Save as otherwise provided under sub-section (3
(1) The Board may constitute an Executive Committee consisting of such number of directors as may be provided for in the regulations.
(2) The Executive Committee shall discharge such functions as may be provided for in the regulations, or, as may be delegated to it, by the Board.
(3) The Board may constitute such other committees, whether consisting only of directors or only of other persons or partly of directors and partly of other persons, for such purpose or purposes, as it may think fit.
(4) The Executive Committee or any other committee constituted under this section shall meet at such times and places and shall observe such rule of procedure in regard to the transaction of business at its meetings as may be provided for in the regulations.
(1) No act or proceeding of the Board or of any Executive or other committee constituted by it shall be invalid merely on the ground of the existence of any vacancy in, or any defect in the constitution of, such Board, or committee, as the case may be
(2) All acts done by a person acting in good faith as a member of the Board or of any committee constituted by it shall be valid, notwithstanding that it may afterwards be discovered that his appointment was invalid by reason of any defect or disqualification or had terminated by virtue of any provision of this Act or any other law for the time being in force :
Provided that nothing in this section shall be deemed to give validity to any act of a member of the Board or of any committee after his appointment has been shown to the Reconstruction Bank to be invalid or to have terminated.
The directors and members of the committee shall be paid such fees and allowances as may be provided for in the regulations for attending the meetings of the Board or of any committee constituted in pursuance of this Act or for attending to any other work of the Reconstruction Bank.
Provided that no fees shall be payable to the Chairman or to any other director or member who is an official of the Government, or, to a Deputy Governor of the Reserve Bank or to any official of the Development Bank or Reconstruction Bank.
(1) The Reconstruction Bank shall function as the principal credit and reconstruction agency for industrial revival by undertaking modernisation, expansion, reorganisation, diversification or rationalisation of industries, and by coordinating similar work of other institutions engaged therein, and shall assist and promote industrial development reconstruction and revival, and undertake rehabilitation of industrial concerns, by providing or procuring assistance and operating schemes for the same, and may, for attaining the said objects, carry on and transact all or any of the following businesses, namely --
(a) granting loans and advances (including working capital) to any industrial concern or subscribing to or purchasing or underwriting the issue of stocks, shares bonds or debentures of any industrial concern or converting the dues in respect of such loans or debentures into the s
(1) The Reconstruction Bank shall not enter into any kind of business with any industrial concern, of which any of the directors of the Reconstruction Bank is a proprietor, partner, director, manager, agent, employee or guarantor, or in which one or more directors of the Reconstruction Bank together hold substantial interest :
Provided that this sub-section shall not apply to any industrial concern if any director of the Reconstruction Bank --
(i) is nominated as a director of the Board of such concern by Government, or a Government company, or by the Reconstruction Bank or by a corporation established by any other law, or
(ii) is elected as a director on the Board-of such industrial concern by virtue of shares held in that industrial concern by Government, or a Government company, or by the R
The Central Government may, after due appropriation made by Parliament by law in this behalf, advance to the Reconstruction Bank interest free loans or loans with interest on such terms and conditions, as may be agreed upon.
(1) The Reconstruction Bank may for the purpose of carrying out its functions under this Act --
(a) issue and sell bonds and debentures with or without guarantee of the Central Government;
(b) borrow money from the Reserve Bank --
(i) repayable on demand or on the expiry of fixed periods, not exceeding ninety days from the date on which the money is so borrowed against the security of stocks, funds and securities (other than immovable property) in which a trustee is authorised to invest trust money by any law for the time being in force in India;
(ii) against bills of exchange or promissory notes arising out of bona fide commercial or trade transactions, bearing two or more good signatures and maturing within five years from the date of borrowing;
The rights and interests of the Reconstruction Bank including any other rights incidental thereto in relation to any loan or advance granted, or any amount recoverable, by it may be transferred by the Reconstruction Bank, either in whole or in part, by the execution or issue of any instrument by endorsement, or in any other manner in which the rights and interests in relation to such loan or advance may be lawfully transferred, and the Reconstruction Bank may, notwithstanding such transfer, act as the trustee of the transferee.
(1) Notwithstanding anything contained in the Foreign Exchange Regulation Act, 1973 or in any other enactment for the time being in force relating to foreign exchange, the Reconstruction Bank may, for the purpose of granting loans and advances under this Act, borrow, with the previous consent of the Central Government, foreign currency from any bank or financial institution in any foreign country or as otherwise prescribed.
(2) The Central Government may, where necessary, guarantee any loan taken by the Reconstruction Bank under sub-section (1) or any part thereof, as to the repayment of principal and payment of interest and other incidental charges.
(3) All loans and advances granted by the Reconstruction Bank out of foreign currency borrowed under sub-section (1) shall be expressed in terms of foreign currency as equivalent of Indian c
The Reconstruction Bank may receive gifts, grants, donations or benefactions from Government or any other source.
With effect from the appointed day, the Reconstruction Bank shall establish a special fund to be called the Reconstruction Assistance Fund.
To the Reconstruction Assistance Fund shall be credited --
(a) all amounts received for the purposes of that Fund by way of loans, gifts, grants, donations or benefactions from Government or any other source;
(b) repayments or recoveries in respect of loans, advances or other facilities granted from the Fund;
(c) income or profits from investments made from the Fund; and
(d) income accruing or arising to the Fund by way of interest or otherwise, on account of the application of the Fund in accordance with the provisions of section 27.
(1) To the Reconstruction Assistance Fund shall be debited--
(a) such amounts as may from time to time be disbursed or spent under section 27;
(b) such amounts as may be required for discharging the liabilities in respect of loans received for the purposes of that Fund;
(c) any loss arising on account of investment made out of that Fund; and
(d) such expenditure arising out of, or in connection with, the administration and application of the Fund as may be determined by the Board.
(2) No amount shall be debited to the Reconstruction Assistance Fund except as provided for in sub-section (1)
(1) The balance-sheet and accounts of the Reconstruction Assistance Fund shall be prepared in such form and manner, as may be provided for in the regulations.
(2) The Board shall cause the books and accounts of the Fund to be closed and balanced as on the 30th day of June each year.
(3) The Reconstruction Assistance Fund shall be audited by one or more auditors appointed by the Central Government under section 34 who shall make a separate report thereon.
(4) The provisions of sub sections (2), (3), (4) and (6) of section 34 shall, so far as may be, apply in relation to the audit of the Reconstruction Assistance Fund as they apply to the audit of the accounts of the Reconstruction Bank.
(5) The Reconstruction Bank shall furnish to the Central Governm
The Reconstruction Assistance Fund shall not be closed or wound up save by the order of the Central Government and in such manner as that Government may direct.
All receipts of the Reconstruction Bank other than those which are to be credited to the Reconstruction Assistance Fund under this Act shall be credited to a Fund to be called the General Fund and all payments by the Reconstruction Bank; other than those which are to be debited to the Reconstruction Assistance Fund shall be made out of the General Fund.
(1) The balance-sheet and accounts of the Reconstruction Bank shall be prepared in such form and manner as may be provided for in the regulations.
(2) The Board shall cause the books and accounts of the Reconstruction Bank to be closed and balanced as on the 30th day of June each year.
(1) The Reconstruction Bank may establish a reserve fund to which may be transferred such sums as that Bank may deem fit out of the annual profits accruing to the General Fund.
(2) After making provision for bad and doubtful debts, depreciation of assets and for all other matters for which provision is necessary or expedient or which is usually provided for by bankers and for the reserve fund referred to in sub section (1), the Reconstruction Bank shall transfer the balance of the net profits to the Central Government.
(1) The accounts of the Reconstruction Bank shall be audited by auditors duly qualified to act as auditors under sub-section (1) of section 226 of the Companies Act, 1956 who shall be appointed by the Central Government for such term and on such remuneration as the Central Government may fix.
(2) The auditors shall be supplied with a copy of the annual balance-sheet of the Reconstruction Bank and it shall be their duty to examine it together with the accounts and vouchers relating thereto and they shall have a list delivered to them of all books kept by the Reconstruction Bank and shall at all reasonable times have access to the books, accounts, vouchers and other documents of the Reconstruction Bank.
(3) The auditors may, in relation to such accounts, examine any director or any officer or other employee of the Reconstruction Bank and s
Save as otherwise provided in sub-section (4) of section 29, nothing contained in this Chapter shall apply to the Reconstruction Assistance Fund.
(1) In entering into any arrangement under Section 18 with an industrial concern, the Reconstruction Bank may impose such conditions as it may think necessary or expedient for protecting the interests of the Reconstruction Bank, and securing that the assistance granted by it is put to the best use by the industrial concern.
(2) Where any arrangement entered into by the Reconstruction Bank with an industrial concern provides for the appointment by the Reconstruction Bank of one or more directors of such industrial concern, such provision and any appointment of directors made in pursuance thereof shall be valid and effective notwithstanding anything to the contrary contained in the Companies Act, 1956, or in any other law for the time being in force or in the memorandum, articles of association or any other instrument relating to the industrial concern, and any provision regarding sh
(1) Where any person or industrial concern seeks any assistance from the Reconstruction Bank on the security of any immovable property belonging to him or to the industrial concern or on the security of the property of some other person whose property is offered as a collateral security for such assistance, such person or industrial concern or, as the case may be, such other person may execute a written declaration in the form specified in the First Schedule stating therein the particulars of the immovable property which is proposed to be offered as security or, as the case may be, collateral security, for such assistance and agreeing that the dues relating to the assistance, if granted, shall be a charge on such property, and, if, on receipt of such declaration, the Reconstruction Bank grants any assistance to the person or the industrial concern aforesaid, the dues relating to such assistance shall, without prejudice to the
Notwithstanding anything contained in any agreement to the contrary, the Reconstruction Bank may, by notice in writing, require any industrial concern to which it has granted any assistance to discharge forthwith in full its entire dues and also discharge its other liabilities to the Reconstruction Bank --
(a) if it appears to the Board that false or misleading information in any material particular was given, in the application for the assistance; or
(b) if the industrial concern has failed to comply with the terms of its agreement with the Reconstruction Bank in the matter of assistance; or
(c) if there is a reasonable apprehension that the industrial concern is unable to pay its debts or that proceedings for liquidation has been, or may be, commenced in respect thereof; or
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(1) Where an assisted industrial concern, which is under a liability to the Reconstruction Bank under any agreement with the Bank, makes any default in the payment of any dues, or in meeting its obligation in relation to any other assistance given by the Reconstruction Bank or otherwise fails to comply with the terms of the agreement with that Bank, the Reconstruction Bank shall have the right to take over the management, or possession, or both, of the industrial concern, as well as the right to transfer by way of lease or sale of the property assigned, charged, hypothecated, mortgaged or pledged to the Reconstruction Bank for the purpose of realising its dues or for the revival of the industrial concern.
(2) Any transfer of property made by the Reconstruction Bank in exercise of the powers conferred on it by sub-section (1) shall vest in the transferee the rights in, or in relatio
(1) (a) Where an assisted industrial concern makes any default in the payment of any dues to, or in meeting its obligation in relation to any other assistance given by the Reconstruction Bank or otherwise fails to comply with the terms of agreement with that Bank, or
(b) where the Reconstruction Bank makes an order under Section 38 requiring the assisted industrial concern to make immediate repayment of any assistance granted to it and the industrial concern fails to make such repayment,
then, without prejudice to the provisions of Section 39 of this Act and of Section 69 of the Transfer of Property Act, 1882, any officer of the Reconstruction Bank generally or specifically authorised by the Board in this behalf, may apply to the concerned High Court for one or more of the following reliefs, namely :--
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(1) Where a person has offered any property as security, whether primary or collateral, for any assistance given by the Reconstruction Bank to any industrial concern, or to such person, and a default has been committed by the industrial concern or by such person in the payment of any dues of the Reconstruction Bank or in meeting any obligation, in relation to the assistance given by the Reconstruction Bank to the industrial concern aforesaid, the Reconstruction Bank shall have the right to take over the management, or possession, or both, of the property so offered as security, and shall have the right to transfer by lease or sale the property aforesaid for the purpose of realising its dues.
(2) Any transfer of property made by the Reconstruction Bank, in exercise of the powers conferred on it by sub-section (1), shall vest in the transferee, the rights in or in relation to the pro
(1) When the management of an industrial concern is taken over by the Reconstruction Bank, that Bank may, by order, notified in the Official Gazette, appoint as many persons as it thinks fit,--
(a) in any case in which the industrial concern is a company, as defined in the Companies Act, 1956, to be the directors of that industrial concern; or
(b) in any other case, to be the administrator of that industrial concern.
(2) The power to appoint directors or administrators under this section includes the power to appoint any individual, firm or body corporate to be the manager of the industrial concern on such terms and conditions as the Reconstruction Bank may think fit.
(3) For the removal of doubts, it is hereby declared that the power to appoint dir
On the issue of a notified order under section 42 --
(a) if the industrial concern is a company as defined in the Companies Act, 1956, all persons holding office as directors of the industrial concern, and in any other case, all persons holding any office having the powers of superintendence, direction and control of the industrial concern, immediately before the issue of the notified order, shall be deemed to have vacated their offices as such;
(b) any contract of management between the industrial concern and any director or manager thereof holding office as such immediately before the issue of the notified order shall be deemed to have terminated;
(c) the directors or administrators, appointed under section 42, shall take such steps as may be necessary to take into their custody or under the
(1) Subject to the control of the Reconstruction Bank, the directors, or, as the case may be, the administrators appointed under section 42, shall take such steps as may be necessary for the purpose of efficiently managing the business of the industrial concern and shall exercise such powers and have such duties as may be prescribed.
(2) Without prejudice to the generality of the powers vested in them under sub-section (1), the directors, or, as the case may be, the administrators appointed under section 42, may, with the previous approval of the Reconstruction Bank, make an application to a court for the purpose of cancelling or varying any contract or agreement entered into at any time before the issue of the notified order under section 42, between the industrial concern and any other person, and the court may, if satisfied after due inquiry that such contract or agreement had b
(1) Notwithstanding anything to the contrary contained in any contract or in any law for the time being in force, no managing or whole-time director or any other director or a manager or any person in charge of management of an industrial concern shall be entitled to any compensation for the loss of office or for the premature termination, under this Act, of any contract of management entered into by him with such concern.
(2) Nothing contained in sub-section (1) shall affect the right of any such managing or whole-time director, or any other director or manager or any such person in charge of management to recover from the industrial concern, moneys recoverable otherwise than by way of such compensation.
(1) Where the management of an industrial concern, being a company as defined in the Companies Act, 1956, is taken over by the Reconstruction Bank, then notwithstanding anything contained in the said Act or in the memorandum or articles of association of such concern,--
(a) it shall not be lawful for the shareholders of such concern or any other person to nominate or appoint any person to be a director of the concern;
(b) no resolution passed at any meeting of the shareholders of such concern shall be given effect to unless approved by the Reconstruction Bank;
(c) no proceeding for the winding up of such concern or for the appointment of a receiver in respect thereof shall lie in any court, except with the consent of the Reconstruction Bank.
(2) Sub
Where the management of an industrial concern not being a company as defined in the Companies Act, 1956, is taken over by the Reconstruction Bank, no suit or proceedings for dissolution or for partition shall, in so far as it relates to that industrial concern, lie in any court or before any tribunal or other authority except with the consent of the Reconstruction Bank.
No proceeding for the appointment of any official assignee or receiver in relation to any industrial concern the management of which has been taken over by the Reconstruction Bank shall lie in any court except with the consent of the Reconstruction Bank.
(1) The Central Government may, if it is satisfied on an application made to it by the Reconstruction Bank that it is necessary so to do for the purpose of reconstructing, reviving or rehabilitating any assisted industrial concern, declare by notification in the Official Gazette, that the operation of all or any of the contracts, assurances of property, agreements settlements, awards, standing orders or other instruments in force (to which such assisted industrial concern is a party, or which may be applicable to such assisted industrial concern) immediately before the issue of such notified order, shall remain suspended or any rights, privileges, obligations and liabilities accruing or arising thereunder before the said date, shall remain suspended or shall be enforceable with such adaptations and in such manner as may be specified in the notified order.
(2) The notified order mad
(1) Where any company, being an industrial concern, is being wound up by the High Court, and the High Court is of opinion that a scheme should be made for the reconstruction, revival or rehabilitation of such industrial concern, it may, by order, authorise the Reconstruction Bank to prepare, and submit to it, a scheme for such reconstruction, revival or rehabilitation of the industrial concern.
(2) The Reconstruction Bank may, in pursuance of the order made by the court under sub-section (I), prepare a scheme for the reconstruction, revival or rehabilitation of the industrial concern referred to in sub-section (1), and the scheme so made may contain all or any of the matters specified in sub-section (7) of section 49;
Provided that no such scheme shall provide for the amalgamation or merger of the company in liquidation or of any underta
(1) Where any property, effects or actionable claims have been sold or leased in pursuance of any power conferred by section 39, section 40 or section 41 or where the management of an industrial concern is taken over by the Reconstruction Bank or its nominee or an undertaking or an industrial concern is amalgamated under section 49, the Reconstruction Bank or the administrator or any director, or any other person authorised by the Reconstruction Bank may, for the purpose of taking into custody or control any such property, effects or actionable claims may request in writing the Chief Metropolitan Magistrate or the District Magistrate within whose jurisdiction any property or books of account or other documents relating to such property or effects or actionable claims may be situated, or found, to take possession thereof, and the Chief Metropolitan Magistrate or the District Magistrate, as the case may be, shall, on such reque
The provisions of this Act and of any rule or scheme made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in the memorandum or articles of association of an industrial concern or in any other instrument having effect by virtue of any law other than this Act.
Notwithstanding anything contained in the Income-tax Act, 1961, or the Companies (Profits) Surtax Act, 1964 or the Interest-tax Act, 1974, or any other enactment for the time being in force relating to tax on income, profits or gains, the Reconstruction Bank shall not be liable to pay income-tax, surtax, interest-tax, or any other tax in respect of --
(a) any income, profits or gains accruing to the Reconstruction Assistance Fund or any amount received to the credit of that Fund;
(b) any income, profits or gains derived, or any amount received, by the Reconstruction Bank; and
(c) any interest collected by, or payable to, the Reconstruction Bank in accordance with the provisions of the Interest-tax Act, 1974.
No provision of law relating to winding up of corporations shall apply to the Reconstruction Bank and the Reconstruction Bank shall not be placed in liquidation, save by order of the Central Government and in such manner as it may direct.
The Reconstruction Bank shall be deemed to be a bank for the purposes of the Bankers' Books Evidence Act, 1891.
Nothing contained in the Banking Regulation Act, 1949, except the provisions of section 34A and section 36AD, shall apply to the Reconstruction Bank.
No provision of the Monopolies and Restrictive Trade Practices Act, 1969, in relation to the amalgamation, merger, modernisation or expansion of any undertaking to which Part III of that Act applies, shall apply when such amalgamation, merger, modernisation or expansion of such undertaking, takes place as a result of any sale, lease, purchase, amalgamation or merger in accordance with the provisions of this Act.
The Reconstruction Bank shall furnish, from time to time, to the Central Government and the Reserve Bank such returns as the Central Government, or, as the case may be, Reserve Bank, may require.
The Board may, by general or special order, delegate, subject to such conditions and limitations, if any, as may be specified in the said order, to the Executive Committee or any other committee constituted under this Act or to any director, officer or other employee of the Reconstruction Bank or to the directors, administrators, officers, or other persons authorised by the Reconstruction Bank to manage any assisted industrial concern or any undertaking owned by such assisted industrial concern, such of its powers and duties under this Act as it may deem necessary.
(1) Without prejudice to the provisions of section 7, the Reconstruction Bank may appoint such number of officers and other employees as it considers necessary or desirable for the efficient performance of its functions and determine their terms and conditions of appointment and service.
(2) The Reconstruction Bank may, notwithstanding anything contained in any other law for the time being in force or in any contract, depute any of its officers or other members of its staff to, or receive on deputation from, prescribed institutions on such terms and conditions as may be prescribed, and may also depute any of its officers or other members of its staff to any assisted industrial concern :
Provided that nothing contained in this section shall be construed as empowering the Reconstruction Bank to depute to any prescribed institution or assis
(1) Reconstruction Bank shall observe, except as otherwise required by law, the practices and usages, customary among bankers and, in particular, it shall not, except as otherwise provided in sub-section (3), divulge any information relating to, or to the affairs of, the assisted industrial concern, except in circumstances in which it is, in accordance with law or practices and usages, customary among bankers, necessary or appropriate for the Reconstruction Bank to divulge such information.
(2) Every director, auditor, adviser, officer or any other employee of the Reconstruction Bank shall, before entering upon his duties, make a declaration of fidelity and secrecy in the form set out in the Second Schedule.
(3) The Reconstruction Bank may, for the purpose of efficient discharge of its functions under this Act, collect from, or furnish t
(1) The Reconstruction Bank shall constitute, for the benefit of the officers and other employees appointed under section 60 (as also for the officers and other employees whose services have been transferred to it under section 7 in such manner and subject to such conditions as may be prescribed, such insurance and provident fund as it may deem fit,
(2) Where any such insurance or provident fund has been so constituted, the Central Government may declare that the provisions of the Provident Funds Act, 1925, shall apply to such fund as if it were a Government Provident Fund.
(1) Every director shall be indemnified by the Reconstruction Bank against all losses and expenses incurred by him in or in relation to the discharge of his duties, except such as are caused by his own wilful act or default.
(2) A director shall not be responsible for any other director or for any officer or other employee of the Reconstruction Bank or for any loss or expenses resulting to the Reconstruction Bank from the insufficiency or deficiency of the value of, or title to, any property or security acquired or taken on behalf of the Reconstruction Bank or the insolvency or wrongful act of any debtor or any person under obligation to the Reconstruction Bank or any thing done in good faith in execution of the duties of his office or in relation thereto.
No suit or other legal proceeding shall lie against the Reconstruction Bank, or any director, or officer, or other employee of the Reconstruction Bank, or any other person authorised by the Reconstruction Bank to discharge any functions under this Act for any loss or damage caused or is likely to be caused by anything which is in good faith done or intended to be done, in pursuance of this Act or any other law or provision having the force of law.
Chairman, director, adviser and auditor and every other employee of the Reconstruction Bank shall be deemed to be public servant for the purposes of Chapter IX of the Indian Penal Code.
If in any application, return or statement or other document made, submitted, furnished or produced for the purpose of obtaining any loan or advance or any other assistance from the Reconstruction Bank any person makes a statement --
(a) which is false in any material particular, knowing it to be false; or
(b) which omits to state any material fact, knowing it to be material;
he shall be punishable with imprisonment for a term which may extend to two years, and shall also be liable to fine.
(1) Where any offence punishable under section 66, has been committed by a company, every person who, at the time the offence was committed was in charge of, and was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly :
Provided that nothing contained in this sub-section shall render any such person liable to any punishment, if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.
(2) Notwithstanding anything contained in sub-section (1), when any offence punishable under section 66 has been committed by a company and it is proved that the offence has been committed with the consent or c
(1) The Central Government may, by notification in the Official Gazette, make rules to carry out the provisions of this Act.
(2) Without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely :--
(a) institutions and agencies in and outside India, payment of whose loans may be guaranteed, counter-guaranteed or indemnified by the Reconstruction Bank, as may be specified under sub-section (1) of section 18;
(b) institutions and agencies which may be provided with the line of credit by the Reconstruction Bank for grant of loans and advances by them to industrial concerns as may be specified under clause (d) of sub-section (1) of section 18;
(c) persons who may be appointed to act as th
(1) The Board may with the previous sanction of the Central Government, make regulations not inconsistent with the provisions of this Act and the rules made thereunder to provide for all matters for which regulations are necessary or expedient for the purpose of giving effect to the provisions of this Act and of the rules made thereunder.
(2) In particular, and without prejudice to the generality of the foregoing power such regulations may provide for all or any of the following matters, namely --
(a) restrictions relating to the powers which may be exercised by the Chairman in pursuance of the provisions of sub section (2) of section 9;
(b) the time and place at which the Board shall meet and the rules of procedure (including quorum) which shall be observed by the Board in regard to the trans
If any difficulty arises in giving effect to the provisions of this Act, the Central Government may, by notification in the Official Gazette, remove the difficulty :
Provided that no such notification shall be made after the expiry of a period of two years from the appointed day.
The enactments specified in Parts I to III of the Third Schedule to this Act shall be amended in the manner directed in the first column thereof and such amendments shall take effect on the dates specified in the second column of that Schedule.
In every Act, rule or regulation in force on the appointed day for the words "Industrial Reconstruction Corporation of India Limited", wherever they occur, the words "Industrial Reconstruction Bank of India" shall be substituted.
(See section 37)
DECLARATION REFERRED TO IN SECTION 37 OF THE INDUSTRIAL RECONSTRUCTION BANK OF INDIA ACT, 1984
I We .............hereby declare that in consideration of the assistance given to me/us or at my/our request, by the Industrial Reconstruction Bank of India, 'as specified in the Annexure hereto. I/we agree that the immovable properties specified in the said Annexure shall form a security for the said assistance and I/We agree that the dues arising out of such assistance shall, on and from the date of execution of these presents, be a charge on the said properties for the recovery of the dues of the said Reconstruction Bank.
Execution by the parties.
1. Signed and delivered by ...............
(p
(See section 61)
DECLARATION OF FIDELITY AND SECRECY
I,...............do hereby declare that I will faithfully, truly and to the best of my skill and ability, execute and perform the duties required of me as the Chairman, Director, member of..........committee, auditor, adviser, officer or other employee of the Reconstruction Bank of India and which properly relate to the office or position held by me in or in relation to the said Reconstruction Bank.
I further declare that I will not communicate or allow to be communicated to any person not legally entitled thereto any information relating to the affairs of the Industrial Reconstruction Bank of India or to the affairs of any person having any dealing with the said Reconstruction Bank, nor will I allow any such person to inspect or have access
(See Section 71)
AMENDMENTS OF CERTAIN ENACTMENTS
PART I
AMENDMENTS TO THE RESERVE BANK OF INDIA ACT, 1934 (2 OF 1934) would be included in its respective place.
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