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Central Government Act
The State Financial Corporations Act, 1951
THE STATE FINANCIAL CORPORATIONS ACT, 1951 THE STATE FINANCIAL CORPORATIONS ACT, 1951
1. Short title, extent and commencement.—
(1) This Act may be called the State Financial Corporations Act, 1951.
(2) It extends to the whole of India 1 [***].
(3) It shall come into force in any State on such dateas the Central Government may, by notification in the Official Gazette, appoint.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
2. Definitions.—In this Act, unless the context otherwise re­quires,—
(a) “Board” means the Board of directors of the Financial Corpo­ration;
2 [(aa) “Development Bank” means the Industrial Development Bank of India established under the Industrial Development Bank of India Act, 1964 (18 of 1964);]
[(b) “Financial Corporation” means a Financial Corporation established under section 3 and includes a Joint Financial Corpo­ration established under section 3A;]
[(c) “industrial concern” means any concern engaged or to be engaged in— (i) the manufacture, preservation or processing of goods;
[(ii) mining or development of mines;] (iii) the hotel industry: (iv) the transport of passengers or goods by road or by water or by air [or by ropeway or by lift]; (v) the generation or distribution of electricity or any other form of power; (vi) the maintenance, repair, testing or servicing of ma­chinery of any description or vehicles or vessels or motor boats or trailers or tractors; (vii) assembling, repairing or packing any article with the aid of machinery or power;
[(viii) the setting up or development of an industrial area or industrial estate;] (ix) fishing or providing shore facilities for fishing or maintenance thereof; [***] [(x) providing weight bridge facilities;
THE STATE FINANCIAL CORPORATIONS ACT, 1951
3. Establishment of State Financial Corporations.—
(1) The State Government may, by notification in the Official Gazette, estab­lish a Financial Corporation for the State under such name as may be specified in the notification.
(2) The Financial Corporation shall be a body corporate by the name notified under sub-section (1), having perpetual succession and a common seal, with power, subject to the provisions of this Act, to 4 [acquire, hold and dispose of] property and shall by the said name sue and be sued.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
[3A. Establishment of Joint Financial Corporations.—
(1) Not­withstanding anything contained in section 3, two or more States may, after consultation with the 5 [Small Industries Bank], enter into an agreement that there shall be one Financial Corporation for the group of States participating in the agreement and if the agreement is published in the Official Gazette of each of those States, the Central Government may, by notification in the Offi­cial Gazette, establish a Joint Financial Corporation to serve the needs of those States under such name as may be specified in the notification.
(2) An inter-State agreement under sub-section (1) among the participating States may—
(a) provide for the fixation of the authorised capital of the Joint Financial Corporation, the number of fully paid-up shares into which it shall be divided and the allocation among the participating States of the shares to be distributed under clause (a) of sub-section (3) of section 4;
(b) provide for the sharing of the liability for the guarantee under section 6 or section 7 [or section 8];
(c) provide for the number of directors to be nominated to the Board by each participating State Government;
(d) provide for the apportionment among the participating States of expenditure in connection with the Joint Financial Corpora­tion; [***]
(f) determine which of the participating State Governments shall exercise the several functions of the State Government under this Act, and references in this Act to the State Government, in relation to the Joint Financial Corporation, shall, save as otherwise expressly provided, be construed accordingly;
(g) provide for consultation among the participating States either generally or with reference to particular matters arising under this Act;
(h) make such incidental and consequential provisions, not inconsistent with this Act, as may be deemed necessary or expedi­ent for giving effect to the agreement.
(3) The Joint Financial Corporation shall be a body corporate by the name notified under sub-section (1), having perpetual succes­sion and a common seal, with power, subject to the provisions of this Act, to acquire, hold and dispose of property and shall, by the said name sue and be sued.
(4) Any reference in this Act to “State” in relation to a Joint Financial Corporation established for two or more States, shall be construed as a reference to each such State.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
4. Share capital and share-holders.— 6 [
(1) The authorised capital of the Financial Corporation shall be such sum as may be fixed by the State Government in this behalf, but it shall not, be less than fifty lakhs of rupees, or exceed five hundred crores of rupees: Provided that the State Government may, on the recommendation of the Small Industries Bank, by notification in the Official Gazette, increase the authorised capital up to one thousand crores of rupees.
(2) Subject to the provisions of section 4D, the authorised capital shall be divided into such number of fully paid-up shares of the same face value and such number of fully paid-up redeemable preference shares of the same face value and shall be issued to the parties mentioned in clauses (a), (b) and (c) of sub-section (3) and in the case of parties referred to in clause (d) of that sub-section, such shares shall be issued at such times and in such manner as the State Government may, by notification in the Official Gazette, determine.
(3) Subject to the approval of the State Government and the Small Industries Bank, the Board shall determine the number of shares which may, respectively, be distributed among— (a) the State Government; (b) the Small Industries Bank; (c) public sector banks, the Life Insurance Corporation of India established under section 3 of the Life Insurance Corporation Act, 1956 (31 of 1956), other insurance companies owned or controlled by the Central Government, other institutions owned or controlled by the Central Government or the State Government, as the case may be; and (d) parties other than those referred to in clause (a), or clause (b) or clause (c): Provided that the number of shares which may be allocated to parties referred to in clause (d) shall in no case exceed forty-nine per cent. of the total number of issued equity shares: Provided further that no increase in the issued equity capital shall be made in such a manner that the parties referred to in clause (a) or clause (b) or clause (c) hold in aggregate, at any time less than fifty-one per cent. of the issued equity capital of the Financial Corporation.]
(4) Subject to the other provisions contained in this section, the allocation of shares among the parties referred to in clauses (c) and (d) of sub-section (3) and the allotment of such shares shall be made by the Financial Corporation in such manner as may be prescribed.
7 [(5) If any shares allocated to any of the parties referred to in clauses (c) and (d) of sub-section (3) remain unsubscribed, they shall be subscribed for equally by the State Government and the [Small Industries Bank].]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
8 [4A. Special class of shares.— 9 [
(1) The State Government may, in consultation with the 10 [Small Industries Bank], specify from time to time such part of the unissued capital of the Financial Corpora­tion as shall be allocated for the issue of a special class of shares.]
(2) The special class of shares so allocated under sub-section (1), shall be,—
(a) divided into such number of shares of the same face value as the State Government may, in consultation with the 10 [Small Industries Bank], determine;
(b) subscribed by the State Government and the 11 [Small Industries Bank] and they may do so in such proportion as may be agreed upon by and between them and the Financial Corporation shall make allotment of such shares accordingly.
(3) The funds representing the capital subscribed as aforesaid shall be used only for such purposes, in such manner and for rendering assistance to such class or category of industrial concerns, as the 11 [Small Industries Bank] may, in consultation with and after obtaining the advice of the State Government, specify in this behalf from time to time and nothing contained in 12 [***] section 48 shall apply thereto.
(4) The rate of dividend declared on the special class of shares in respect of any accounting year of a Financial Corporation shall not exceed the rate of dividend in respect of its other shares.
(5) Nothing contained in sub-sections (2) to (5) of section 4, section 5, and 13 [sub-sections (1) to (4) of section 6], shall apply to the special class of shares.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
14 [4B. Transfer of share capital to Development Bank.—On such date as the Central Government may, by notification in the Offi­cial Gazette, specify (hereinafter referred to as the specified date), all the shares of every Financial Corporation subscribed by the Reserve Bank as on the date immediately preceding the specified date, shall, stand transferred to, and vested in, the Development Bank.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
15 [4C. Payment of amount.—The Reserve Bank shall be given by the Development Bank, in cash, for the transfer to, and vesting in, the Development Bank of the shares of every Financial Corporation which have been subscribed by the Reserve Bank, an amount equal to the face value of the shares of the Financial Corporation so subscribed.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951 THE STATE FINANCIAL CORPORATIONS ACT, 1951 THE STATE FINANCIAL CORPORATIONS ACT, 1951 THE STATE FINANCIAL CORPORATIONS ACT, 1951 THE STATE FINANCIAL CORPORATIONS ACT, 1951 THE STATE FINANCIAL CORPORATIONS ACT, 1951
21 [5. Transfer of shares.—
(1) Save as otherwise provided in sub-section (2), the shares of the Financial Corporation shall be freely transferable.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
22 [6. Conversion of shares guaranteed by State Government.—
(1) On the commencement of the State Financial Corporations (Amendment) Act, 2000, every shareholder shall be given by the Financial Corporation an option to require the Financial Corporation to convert the shares held by him into shares of the same nominal value without the State Government guarantee and issue fresh share certificate or to pay the amount paid in respect of such shares not exceeding the face value of the shares held by him.
(2) The option referred to in sub-section (1) shall be given by the Financial Corporation to every existing shareholder before the expiry of three months from the commencement of the State Financial Corporations (Amendment) Act, 2000 and shall be exercised by the shareholder within three months from the date of receipt of such option.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
23 [7. Additional capital of Financial Corporation and its borrowing powers.—
(1) The Financial Corporation may issue and sell bonds and debentures for the purpose of increasing its working capital.
(2) The State Government may, on a request being made to it by the Financial Corporation, guarantee the bonds and debentures issued by the Financial Corporation as to the repayment of principal and the payment of interest at such rate as may be fixed by that Government.
(3) Notwithstanding anything contained in the Acts hereinafter mentioned in this sub-section, such of the bonds and debentures issued by the Financial Corporation as are guaranteed by the State Government as to the repayment of the principal and payment of interest and receipts issued by it for such of deposits as are guaranteed by the State Government as to the repayment of the principal and payment of interest shall be deemed to be included among the securities enumerated in section 20 of the Indian Trusts Act, 1882 (2 of 1882) and also to be approved securities for the purpose of the Insurance Act, 1938 (4 of 1938) and the Banking Regulation Act, 1949 (10 of 1949).
(4) The Financial Corporation may, for the purposes of carrying out its functions under this Act, borrow money from the Reserve Bank—
(5) The Financial Corporation may, for the purpose of carrying out its functions under this Act, borrow money from the State Government, any financial institution, scheduled bank, insurance company or any other person approved by the Board on such terms and conditions as may be agreed upon.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
24 [8. Deposits with Financial Corporation.—
(1) The Financial Corporation may accept from the State Government, or with the prior approval of the Reserve Bank, from a local authority or any other person deposits repayable after the expiry of a period which shall not be less than twelve months from the date of the making of the deposit and on such other terms as the Board thinks fit: Provided that the total amount of such deposits shall not exceed twice the paid-up share capital of the Financial Corporation: Provided further that the State Government may permit the Financial Corporation to accept deposits up to a higher limit not exceeding ten times the paid-up share capital of the Financial Corporation.
(2) Any depsoit accepted under sub-section (1), other than a deposit from the State Government may, if so required by the Financial Corporation, be guaranteed by the State Government as to the repayment of the principal and payment of interest.]
25 [9. Managements.—
THE STATE FINANCIAL CORPORATIONS ACT, 1951
26 [10. Board of directors.—The Board of directors shall consist of the following, namely:—
(a) a director to be nominated as chairman under sub-section (1) of section 15;
(b) two directors nominated by the State Government of whom one director shall be a person who has special knowledge of or experience in small-scale industries: Provided that in the case of a Joint Financial Corporation, the number of directors shall be such as the State Governments of the participating States may, by agreement among themselves, think fit to nominate each participating State Government nominating not more than two directors: Provided further that in the case of a Joint Financial Corporation, the director, who shall have special knowledge of, or exprience in, small-scale industries, shall be nominated by that participating State which, according to the terms of agreement between the participating States, is entitled to make such nomination;
(c) two directors nominated by the Small Industries Bank;
(d) two directors nominated in the prescribed manner by the parties mentioned in clause (c) of sub-section (3) of section 4;
(e) such number of directors elected, in the prescribed manner, by share-holders, other than those mentioned in clauses (a), (b) and (c) of sub-section (3) of section 4, whose names are entered on the register of shareholders of the Financial Corporation, ninety days before the date of the meeting in which such election takes place on the following basis, namely:—
(f) a managing director appointed in accordance with the provisions of sub-section (1) of section 17: Provided that on the first constitution of the Board, the directors referred to in clause (d) shall be nominated by the State Government and directors so nominated shall, for the purpose of this Act, be deemed to be elected directors: Provided further that all the directors of the Board first constituted, other than the managing director, shall retire at the end of the first year.] 27 [***]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
28 [11. Term of office and retirement of directors.—
(1) A nominated director shall hold office during the pleasure of the authority nominating him.
(2) Subject to the provisions of sub-section (1), a nominated director shall hold office for such term not exceeding three years and shall also be eligible for re-nomination: Provided that no such director shall hold office continuously for a period exceeding six years.
(3) An elected director other than a director deemed to be elected under the first proviso to clause (d) of section 10 shall hold office for three years and shall also be eligible for re-election: Provided that no such director shall hold office continuously for a period exceeding six years.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
12. Disqualifications for being a director.—No person shall be a director, if he—
(a) has been found to be of unsound mind by a court of competent jurisdiction and the finding is in force; or
(b) is or at any time has been, adjudicated as insolvent or has suspended payment of his debts or has compounded with his creditors; or
(c) has been convicted by a court of any offence involving moral turpitude and sentenced in respect thereof to imprisonment of not less than six months and a period of five years has not elapsed from the date of expiry of the sentence; or
(d) is elected by the persons referred to in clause (d) of sub-section (3) of section 4 but not registered as shareholder in his own right of unencumbered shares of a nominal value of not less than ten thousand rupees in the Financial Corporation; or
THE STATE FINANCIAL CORPORATIONS ACT, 1951
13. Removal of director from office.— 29 [
THE STATE FINANCIAL CORPORATIONS ACT, 1951
14. Resignation of office by director and filling up of casual vacancies.— 31 [
(1) Any director elected under clause (d) of section 10 may, by giving notice in writing to the Chairman of the Board, resign from his office and on such resignation being accepted, shall be deemed to have vacated his office.]
(2) A casual vacancy in the office of an elected director shall be filled by election and a director so elected shall hold office for the unexpired portion of the term of his predecessor.
(3) No act or proceeding of the Board shall be questioned on the ground merely of the existence of any vacancy in, or any defect in the constitution of the Board.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
32 [15. Chairman of Board.—
(1) The Small Industries Bank shall, in consultation with the State Government nominate a director as a Chairman of the Board for such period not exceeding three years and on such terms and conditions as the Small Industries Bank may specify: Provided that the Chairman shall not be a whole-time director unless he is also appointed to function as the managing director: Provided further that the Chairman shall so long as he remains a director be eligible for re-appointment as Chairman.
(2) The Chairman shall preside over the meetings of the Board and the general meetings of the Financial Corporation.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
33 [16. Remuneration of directors.—The directors other than the managing director and not being servants of the Government shall be paid such fees as may be prescribed for attending meetings of the Board and, if they are members of the Executive Committee, or any other committee appointed by the Financial Corporation, for attending meetings of such committee.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
17. Managing director.— 34 [
(1) The managing director shall—
(a) be appointed, in consultation with the Small Industries Bank, by the State Government;
(b) be a whole-time officer of the Financial Corporation;
(c) perform such duties as the Board, by regulations, entrust or delegate to him;
(d) hold office for such term not exceeding three years as the State Government may specify and shall be eligible for re-appointment;
35 [(2) The State Government may, after consulting the Board, remove the managing director from office: Provided that no managing director shall be so removed unless he has been given an opportunity of showing cause against his remov­al.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
37 [18. Executive Committee.—
(1) The Board shall constitute an Executive Committee consisting of the chairman and managing director, the whole-time directors and such other directors as it may deem fit: Provided that in the case of a Joint Financial Corporation, if the directors nominated under clause (b) of section 10 represent different State Governments then, all of them shall be members of the Executive Committee.
(2) The Executive Committee shall discharge such functions as may be prescribed or as may be delegated to it by the Board.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
19. Meetings of the Board and Committee.—
(1) The Board and the Executive Committee shall meet at such times and places and shall observe such rules of procedure in regard to transaction of business at its meetings as may be provided by regulation made under this Act.
(2) All questions at a meeting shall be decided by a majority of votes of the members present, and, in the case of equality of votes, the Chairman or in his absence, any other person presid­ing, shall have a second or casting vote.
(3) No director shall vote on any matter in which he is interest­ed. 38 [***] 39 [***]
40 [(5) If for any reason the Chairman of the Board or the Chairman of the Executive Committee is unable to attend any meeting of the Board or, as the case may be, of the Executive Committee,—
(a) in the case of the meeting of the Board, a director 41 [***] authorised by the Chairman of the Board in writing shall preside at such meeting, but if the director so authorised is absent or if no such authorisation has been made, the Board may elect a director to preside at that meeting; and
(b) in the case of the meeting of the Executive Committee, a member authorised in writing by the Chairman of that Committee shall preside at that meeting, but if the member so authorised is absent or if no such authorisation has been made, the Committee may elect any of its members to preside at that meeting.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
20. Powers of Executive Committee.—
(1) Subject to such general or special directions as the Board may from time to time give, the Executive Committee may deal with any matter within the com­petence of the Board.
(2) The minutes of every meeting of the Executive Committee 42 [shall, after confirmation thereof at the next meeting of the Executive Committee, be laid] before the Board at the next fol­lowing meeting of the Board.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
21. Advisory Committee.—The Financial Corporation may appoint 43 [one or more committee or committees consisting wholly of direc­tors or wholly of other persons or partly of directors and partly of other persons] for the purpose of assisting the Financial Corporation in the efficient discharge of its functions and, in particular, for the purpose of securing that those functions are exercised with due regard to the circumstances and conditions prevailing in, and the requirements of, particular areas or industries.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
44 [22. Offices and agencies.—The Financial Corporation shall establish its head office and other offices and agencies at such places as the State Government may, from time to time specify and save as aforesaid, the Financial Corporation may establish addi­tional offices or agencies in such other places within the State as it may consider necessary.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
23. Officers and other employees of the Financial Corporation.—The Financial Corporation may appoint such offic­ers, advisers and employees as it considers necessary for the efficient performance of its functions, and determine, by regula­tions, their conditions of appointment and service and the remu­neration payable to them: 45 [***]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
24. General duty of the Board.—The Board in discharging its functions under this Act shall act on business principles due regard being had by it to the interests of industry, commerce and the general public.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
46 [25. Business which Financial Corporation may transact.— 47 [
(1) The Financial Corporation may, subject to the provisions of this Act, carry on and transact any of the following kinds of business, namely:—
(a) guaranteeing, on such terms and conditions as may be agreed upon,—
(i) loans raised by industrial concerns which are repayable within a period not exceeding twenty years, and are floated in the public market;
(ii) loans raised by industrial concerns from scheduled banks or State co-operative banks or other financial institutions;
(b) guaranteeing, on such terms and conditions as may be agreed upon, deferred payments due from any industrial concern in connection with its purchase of capital goods within India;
(c) underwriting of the issue of stock, shares, bonds or debentures by industrial concerns;
(d) transferring for consideration any instruments relating to loans and advances granted by it to industrial concerns;
(e) acting as agent of the Central Government or the State Government or the Development Bank or the Small Industries Bank or the IFCI Limited formed and registered under the Companies Act, 1956 (1 of 1956) or any other financial institution notified in this behalf by the Central Government in respect of any matter connected with, or arising out of, the grant of loans or advances to an industrial concern, or subscription to debentures of an industrial concern or relating to the business of the Development Bank, Small Industries Bank, IFCI Limited or financial institution;
(f) subscribing to, or purchasing of, the stock, shares, bonds or debentures of an industrial concern or any other concern;
(g) retaining as part of its assets any stock, shares, bonds or debentures which it may acquire by subscription or in fulfilment of its underwriting liabilities and disposing of the stock, shares, bonds or debentures so acquired;
(h) granting loans or advances to, or subscribing to debentures of, an industrial concern, repayable within a period not exceeding twenty years from the date on which they are granted or subscribed to, as the case may be: Provided that the Financial Corporation may, with the prior approval of the Small Industries Bank, exceed the said limit of twenty years up to a further period of ten years: Provided further that nothing contained in this clause shall be deemed to preclude the Financial Corporation from granting loans or advances to, or subscribing to debentures of, and industrial concern to which may be attached an option to convert such debentures or loans into stock or shares of the industrial concern: Provided also that the Financial Corporation may, in the exercise of such option, convert the amounts outstanding on such debentures or loans into stock or shares of the industrial concern if such concern increases its subscribed capital by the issue of further stock or shares in accordance with and subject to, the provisions of section 81 of the Companies Act, 1956 (1 of 1956). Explanation.—In this clause, the expression "the amounts outstanding on such debentures or loans" shall mean the principal, interest and other charges payable on such debentures or loans as at the time when the amounts are sought to be converted into stock or shares;
51 [(4) Nothing contained in this section shall entitle any Financial Corporation to hold shares in any company, whether as pledgee, mortgagee or absolute owner, of an amount exceeding thirty per cent. of the subscribed share capital of that company or thirty per cent. of its own paid-up share capital and free reserves, whichever is less.
(5) If, on the commencement of the State Financial Corporations (Amendment) Act, 1972 (77 of 1972), any Financial Corporation is holding shares in excess of the limits specified in sub-section (4), the Corproation shall report the matter forthwith to the Reserve Bank and shall, within such period as the Reserve Bank may allow, so reduce its share holdings as to conform to the provisions of that sub-section.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
52 [25A. Power to acquire rights.—The Financial Corporation shall have the right to acquire, by transfer or assignment, the rights and interests of any such financial institution as may be noti­fied by the Central Government (including any other rights inci­dental thereto) in relation to any loan or advance granted or any amount recoverable by such institution, either in whole or in part, by the execution or issue of any instrument or by the transfer of any instrument by endorsement or in any other manner: Provided that such loan or advance or amount relates to any business which the Financial Corporation may transact under this Act.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951 THE STATE FINANCIAL CORPORATIONS ACT, 1951
54 [26. Limit of accommodation.—On and from the commencement of the State Financial Corporations (Amendment) Act, 2000, the Financial Corporation shall not enter into any arrangements under clause
THE STATE FINANCIAL CORPORATIONS ACT, 1951
27. Power to impose conditions for accommodation.—
(1) In enter­ing into any arrangement under section 25 with an industrial concern, the Financial Corporation may impose such conditions as it may think necessary or expedient for protecting the interests of the Financial Corporation and securing that the accommodation granted by it is put to the best use by the industrial concern.
55 [(2) Where any arrangement entered into by the Financial Corpo­ration with an industrial concern provides for the appointment by the Financial Corporation 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 (1 of 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 share qualification, age limit, number of director­ships, removal of office of directors and such like conditions contained in any such law or instrument aforesaid shall not apply to any director appointed by the Financial Corporation in pur­suance of the arrangement as aforesaid.
(3) Any director appointed in pursuance of sub-section (2) shall—
(a) hold office during the pleasure of the Financial Corporation and may be removed or substituted by any person by order in writing by the Financial Corporation;
(b) not incur any obligation or liability by reason only of his being a director or for anything done or omitted to be done in good faith in the discharge of his duties as a director or any­thing in relation thereto;
(c) not be liable to retirement by rotation and shall not be taken into account for computing the number of directors liable to such retirement.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
28. Prohibited business.— 56 [
(1) ] The Financial Corporation shall not—
57 [(a) except as provided in section 8, accept deposits;
(b) except as provided in clauses 58 [(da)], (f) and (g) of sub-section (1) of section 25, subscribe to the shares or stock of any company;]
(c) grant any loan or advance on the security of its own shares;
59 [(d) grant any form of assistance to any industrial concern in respect of which the aggregate of the paid-up share capital and free reserves exceeds ten crores of rupees or such higher amount not exceeding thirty crores of rupees as the State Government, on the recommendation of the Small Industries Bank, may, by notification in the Official Gazette, specify.]
58 [(2) The Financial Corporation shall not enter into any kind of business with any industrial concern, of which any of the direc­tors of the Financial Corporation is a proprietor, partner, director, manager, agent, employee or guarantor, or in which one or more directors of the Financial Corporation together hold substantial interest: Provided that this section shall not apply to any industrial concern if any director of the Financial Corporation—
(i) is nominated as a director of the Board of such concern by the Government or a Government company as defined in section 617 of the Companies Act, 1956 (1 of 1956) or by a Corporation estab­lished by or under any other law; or
(ii) is elected on the Board of such concern by virtue of shares held in the concern by Government or a Government company as defined in section 617 of the Companies Act, 1956 (1 of 1956) or by a Corporation established by or under any other law, by reason only of such nomination or election, as the case may be. Explanation.—“Substantial interest” in relation to an industrial concern means the beneficial interest held by one or more of the directors of the Financial Corporation or by any relative as defined in clause (41) of section 2 of the Companies Act, 1956 (1 of 1956) of such director whether singly or taken together, in the shares of the industrial concern, the aggregate amount paid-up on which either exceeds five lakhs of rupees or five per cent. of the paid-up share capital of the industrial concern, whichever is less.
(3) The provisions of sub-section (2)—
(i) shall not apply to any transaction relating to the business entered into prior to the commencement of the State Financial Corporations (Amendment) Act, 1972 (77 of 1972) and all such business and any transaction in relation thereto may be imple­mented or continued as if that Act had not come into force;
(ii) shall apply only so long as the conditions precedent to such disability as set out in the sub-section continue.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
29. Rights of Financial Corporation in case of default.—
(1) Where any industrial concern, which is under a liability to the Financial Corporation under an agreement, makes any default in repayment of any loan or advance or any instalment thereof 60 [or in meeting its obligations in relation to any guarantee given by the Corporation] or otherwise fails to comply with the terms of its agreement with the Financial Corporation, the Financial Corpo­ration shall have the 61 [right to take over the management orpos­session or both of the industrial concerns], as well as the 62 [right to transfer by way of lease or sale] and realise the property pledged, mortgaged, hypothecated or assigned to the Financial Corporation.
(2) Any transfer of property made by the Financial Corporation, in exercise of its powers 63 [***] under sub-section (1), shall vest in the transferee all rights in or to the property trans­ferred 64 [as if the transfer] had been made by the owner of the property.
(3) The Financial Corporation shall have the same rights and powers with respect to goods manufactured or produced wholly or partly from goods forming part of the security held by it as it had with respect to the original goods.
65 [(4) 66 [Where any action has been taken against an industrial concern] under the provisions of sub-section (1), all costs, 67 [charges and expenses which in the opinion of the Financial Corporation have been properly incurred] by it 68 [as incidental thereto] shall be recoverable from the industrial concern and the money which is received by it 69 [***] shall, in the absence of any contract to the contrary, be held by it in trust to be ap­plied firstly, in payment of such costs, charges and expenses and, secondly, in discharge of the debt due to the Financial Corporation, and the residue of the money so received shall be paid to the person entitled thereto.]
(5) 66 [Where the Financial Corporation has taken any action against an industrial concern] under the provisions of sub-section (1), the Financial Corporation shall be deemed to be the owner of such concern, for the purposes of suits by or against the concern, and shall sue and be sued in the name of 70 [the concern].
THE STATE FINANCIAL CORPORATIONS ACT, 1951
30. Power to call for repayment before agreed period.—Notwith­standing anything in any agreement to the contrary, the Financial Corporation may, by notice in writing, require any industrial concern to which it has granted any loan or advance to discharge forthwith in full its liabilities to the Financial Corporation,—
(a) if it appears to the Board that false or misleading informa­tion in any material particular was given by the industrial concern in its application for the loan or advance; or
(b) if the industrial concern has failed to comply with the terms of its contract with the Financial Corporation in the matter of the loan or advance; or
(c) if there is a reasonable apprehension that the industrial concern is unable to pay its debts or that proceedings for liqui­dation may be commenced in respect thereof; or
(d) if the property pledged, mortgaged, hypothecated or assigned to the Financial Corporation as security for the loan or advance is not insured and kept insured by the industrial concern to the satisfaction of the Financial Corporation or depreciates in value to such an extent that, in the opinion of the Board, fur­ther security to the satisfaction of the Board should be given and such security is not given; or
(e) if, without the permission of the Board, any machinery, plant or other equipment, whether forming part of the security or otherwise, is removed from the premises of the industrial concern without being replaced; or
(f) if for any reason it is necessary to protect the interests of the Financial Corporation.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
31. Special provisions for enforcement of claims by Financial Corporation.—
(1) Where an industrial concern, in breach of any agreement, makes any default in repayment of any loan or advance or any instalment thereof 71 [or in meeting its obligations in relation to any guarantee given by the Corporation] or otherwise fails to comply with the terms of its agreement with the Finan­cial Corporation or where the Financial Corporation requires an industrial concern to make immediate repayment of any loan or advance under section 30 and the industrial concern fails to make such repayment, 72 [then, without prejudice to the provisions of section 29 of this Act and of section 69 of the Transfer of Property Act, 1882 (4 of 1882)] any officer of the Financial Corporation, generally or specially authorised by the Board in this behalf, may apply to the district judge within the limits of whose jurisdiction the industrial concern carries on the whole or a substantial part of its business for one or more of the follow­ing reliefs, namely:—
(a) for an order for the sale of the property pledged, mort­gaged, hypothecated or assigned to the 73 [Financial Corporation] as security for the loan or advance; or
74 [(aa) for enforcing the liability of any surety; or]
(b) for transferring the management of the industrial concern to the Financial Corporation; or
(c) for an ad interim injunction restraining the industrial concern from transferring or removing its machinery or plant or equipment from the premises of the industrial concern without the permission of the Board, where such removal is apprehended.
(2) An application under sub-section (1) shall state the nature and extent of the liability of the industrial concern to the Financial Corporation, the ground on which it is made and such other particulars as may be prescribed.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
32. Procedure of district judge in respect of applications under section 31.—
(1) When the application is for the reliefs men­tioned in clauses
75 [(1A) When the application is for the relief mentioned in clause (aa) of sub-section (1) of section 31, the district judge shall issue a notice calling upon the surety to show cause on a date to be specified in the notice why his liability should not be enforced.]
(2) When the application is for the relief mentioned in clause (b) of sub- section (1) of section 31, the district judge shall grant an ad interim injunction restraining the industrial concern from transferring or removing its machinery, plant or equipment and issue a notice calling upon the industrial concern to show cause, on a date to be specified in the notice, why the manage­ment of the industrial concern should not be transferred to the Financial Corporation.
(3) Before passing any order under sub-section (1) or sub-section (2) 75 [or issuing a notice under sub-section (1A),] the district judge may, if he thinks fit, examine the officer making the application.
76 [(4) At the same time as he passes an order under sub-section (1), the district judge shall issue to the industrial concern or to the owner of the security attached a notice accompanied by copies of the order, the application and the evidence, if any, recorded by him calling upon it or him to show cause on a date to be specified in the notice why the ad interim order of attachment should not be made absolute or the injunction confirmed.
(4A) If no cause is shown on or before the date specified in the notice under sub-section (1A) the district judge shall forthwith order the enforcement of the liability of the surety.]
(5) If no cause is shown on or before the date specified in the notice under sub-sections (2) and (4), the district Judge shall forthwith make the ad interim order absolute and direct the sale of the attached property or transfer the management of the indus­trial concern to the Financial Corporation or confirm the injunc­tion.
(6) If cause is shown, the district judge shall proceed to inves­tigate the claim of the Financial Corporation in accordance with the provisions contained in the Code of Civil Procedure, 1908 (5 of 1908) insofar as such provisions may be applied thereto.
(7) After making an investigation under sub-section (6), the district judge may—
(a) confirm the order of attachment and direct the sale of the attached property;
(b) vary the order of attachment so as to release a portion of the property from attachment and direct the sale of the remainder of the attached property;
(c) release the property from attachment;
(d) confirm or dissolve the injunction; 77 [***];
75 [(da) direct the enforcement of the liability of the surety or reject the claim made in this behalf; or]
(e) transfer the management of the industrial concern to the Financial Corporation or reject the claim made in this behalf: Provided that when making an order under clause (c) 75 [or making an order rejecting the claim to enforce the liability of the surety under clause (da) or making an order rejecting the claim to transfer the management of the industrial concern to the Financial Corporation under clause (e)], the district judge may make such further orders as he thinks necessary to protect the interests of the Financial Corporation and may apportion the costs of the proceedings in such manner as he thinks fit: Provided further that unless the Financial Corporation intimates to the district judge that it will not appeal against any order releasing any property from attachment 75 [or rejecting the claim to enforce the liability of the surety or rejecting the claim to transfer the industrial concern to the Financial Corporation], such order shall not be given effect to, until the expiry of the period fixed under sub-section (9) within which an appeal may be preferred or, if an appeal is preferred, unless the High Court otherwise directs until the appeal is disposed of.
(8) An order of attachment or sale of property under this section shall be carried into effect as far as practicable in the manner provided in the Code of Civil Procedure 1908 (5 of 1908) for the attachment or sale of property in execution of a decree as if the Financial Corporation were the decree-holder.
78 [(8A) An order under this section transferring the management of an industrial concern to the Financial Corporation shall be carried into effect, as far as may be practicable, in the manner provided in the Code of Civil Procedure, 1908 (5 of 1908) for the possession of immovable property or the delivery of movable property in execution of a degree, as if the Financial Corpora­tion were the decree-holder.]
(9) Any party aggrieved by an order 79 [under sub-section (4A), sub-section (5)] or sub-section (7) may, within thirty days from the date of the order, appeal to the High Court, and upon such appeal the High Court may, after hearing the parties, pass such orders thereon as it thinks proper.
(10) Where proceedings for liquidation in respect of an industri­al concern have commenced before an application is made under sub-section (1) of section 31, nothing in this section shall be construed as giving to the Financial Corporation any preference over the other creditors of the industrial concern not conferred on it by any other law.
80 [(11) The functions of a district judge under this section shall be exercisable—
(a) in a presidency town, where there is a city civil court having jurisdiction, by a judge of that court and in the absence of such court, by the High Court; and
(b) elsewhere, also by an additional district judge 77 [or by any judge of the principal court of civil jurisdiction].]
81 [(12) For the removal of doubts it is hereby declared that any court competent to grant an ad interim injunction under this section shall also have the power to appoint a Receiver and to exercise all the other powers incidental thereto.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
82 [32A. Power of Financial Corporation to appoint directors or administrators of an industrial concern when management is taken over.—
(1) When the management of an industrial concern is taken over by the Financial Corporation, the Financial Corporation 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 (1 of 1956) to be directors of that industrial concern; or
(b) in any other case, to be administrators of that industrial concern.
(2) The power to appoint directors or administrators under this section includes the power to appoint any individual, firm or company to be the managing agent or manager of the industrial concern on such terms and conditions as the Financial Corporation may think fit.]
83 [(3) Nothing in the Companies Act, 1956 (1 of 1956) or in any other law for the time being in force or in any instrument relat­ing to the industrial concern shall, in so far as it makes in relation to a director, any provision for the holding of any share qualification, age limit, restriction on the number of directorships, retirement by rotation or removal from office, apply to any director appointed by the Financial Corporation under this section.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
84 [32B. Effect of notified order under section 32A.—On the issue of a notified order under section 32A.—
(a) in any case in which the industrial concern is a company as defined in the Companies Act, 1956 (1 of 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 managing agent or any director or manager thereof holding office as such immediately before the issue of the notified order shall be deemed to have terminated;
(c) in the case of an industrial concern which is a company as defined in the Companies Act, 1956 (1 of 1956) the managing agent, if any, appointed under section 32A shall be deemed to have been duly appointed in pursuance of the said Act and the memorandum and articles of association of the industrial concern and the provisions of the said Act and the memorandum and arti­cles shall, subject to the other provisions contained in this Act, apply accordingly, but no such managing agent shall be removed from office except with the previous consent of the Financial Corporation;
(d) the directors or the administrators appointed under section 32A shall take such steps as may be necessary to take into their custody or under their control all the property, effects and actionable claims to which the industrial concern is, or appears to be, entitled, and all the property and effects of the indus­trial concern shall be deemed to be in the custody of the direc­tors or administrators as the case may be, as from the date of the notified order;
(e) the directors appointed under section 32A shall, for all purposes, be the directors of the industrial concern duly consti­tuted under the Companies Act, 1956 (1 of 1956) and such direc­tors, or as the case may be, the administrators appointed under section 32A, shall alone be entitled to exercise all the powers of the directors or as the case may be, of the persons exercising powers of superintendence, direction and control, of the indus­trial concern, whether such powers are derived from the said Act or from the memorandum or articles of association of the indus­trial concern or from any other source whatsoever.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
85 [32C. Powers and duties of directors and administrators.—
(1) Sub­ject to the control of the Financial Corporation, the directors, or as the case may be, the administrators appointed under section 32A, 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 32A, may, with the previous approval of the Financial Corporation, 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 32A, between the industrial concern and any other person and the court may, if satisfied after due inquiry that such contract or agreement had been en­tered into in bad faith and is detrimental to the interests of the industrial concern, make an order cancelling or varying (either unconditionally or subject to such conditions as it may think fit to impose) that contract or agreement and the contract or agreement shall have effect accordingly.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
86 [32D. No right to compensation for termination of contract of managing agent, managing director, etc.—
(1) Notwithstanding any­thing to the contrary contained in any contract or in any law for the time being in force, no managing agent, managing 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 agent or managing 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.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
87 [32D. No right to compensation for termination of contract of managing agent, managing director, etc.—
(1) Notwithstanding any­thing to the contrary contained in any contract or in any law for the time being in force, no managing agent, managing 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 agent or managing 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.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
88 [32E. Application of Act 1 of 1956.—
(1) Where the management of an industrial concern, being a company as defined in the Compa­nies Act, 1956 (1 of 1956), is taken over by the Financial Corporation, 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 Financial Corporation;
(c) no proceeding for the winding up of such concern or for the appointment of receiver in respect thereof shall lie in any court, except with the consent of the Financial Corporation.
(2) Subject to the provisions contained in sub-section (1) and to the other provisions contained in this Act and subject to such other exceptions, restrictions and limitations, if any, as the Central Government in consultation with the State Government, by notification in the Official Gazette, specify in this behalf, the Companies Act, 1956 (1 of 1956) shall continue to apply to such concern in the same manner as it applied thereto before the issue of the notified order under section 32A.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
89 [32F. Restriction on filing of suits for dissolution, etc., of an industrial concern not being a company when its management is taken over.—
(1) Where the management of an industrial concern not being a company as defined in the Companies Act, 1956 (1 of 1956) is taken over by the Financial Corporation, no suit or proceedings for dissolution or for partition shall, insofar as it relates to that industrial concern, lie in any court or before any trib­unal or other authority except with the consent of the Financial Corporation.
(2) 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 Financial Corporation shall lie in any court except with consent of the Financial Corporation.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
90 [32G. Recovery of amounts due to the Financial Corporation as an arrear of land revenue.—Where any amount is due to the Financial Corporation in respect of any accommodation granted by it to any industrial concern, the Financial Corporation or any person authorised by it in writing in this behalf, may, without preju­dice to any other mode of recovery, make an application to the State Government for the recovery of the amount due to it, and if the State Government or such authority, as that Government may specify in this behalf, is satisfied, after following such proce­dure as may be prescribed, that any amount is so due, it may issue a certificate for that amount to the Collector, and the Collector shall proceed to recover that amount in the same manner as an arrear of land revenue.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
33. Funds of the Financial Corporation.—
(1) Every Financial Corporation shall have its own fund, and all receipts of the Financial Corporation shall be carried thereto and all payments by the Corporation shall be made therefrom.
(2) All moneys belonging to the fund shall be deposited in the Reserve Bank 91 [or the State Bank of India or a subsidiary bank as defined in the State Bank of India (Subsidiary Banks) Act, 1959 (38 of 1959)] 92 [or in any of the banks specified in column 2 of the First Schedule to the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of 1970) 93 [or any of the banks specified in column 2 of the First Schedule to the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980)] 94 [or, in consultation with the Reserve Bank, in a scheduled bank or a State Co-operative Bank].
THE STATE FINANCIAL CORPORATIONS ACT, 1951
95 [34. Investment of funds.—The Financial Corporation may invest its funds in accordance with applicable guidelines and prudential norms as may be prescribed and in such securities as the Board may decide from time to time.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
35. Disposal of profits.—
(1) The Financial Corporation shall establish a reserve fund.
(2) After making provision for bad and doubtful debts, deprecia­tion of assets and all other matters which are usually provided for by banking companies, the Financial Corporation may out of its net annual profits declare a dividend: 96 [***] 97 [***]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
98 [35A. Special reserve fund.—
(1) the Financial Corporation may establish a special reserve fund, to which shall be transferred such portion of the dividends accruing to the State Government Development Bank and the Small Industries Bank on the shares of the Financial Coporation as may be fixed by agreement between the State Government, Development Bank and the Small Industries Bank: Provided that after the notified date this sub-section shall have effect as if for the words "the State Government, the Development Bank and the Small Industries Bank", the words "the State Government and the Small Industries Bank" have been substituted except as regards all dividends accruing in respect of any completed accounting period prior to the notified date.
(2) No shareholder of the Financial Corporation, other than the State Government or the Small Industries Bank, shall have any claim to the special reserve fund.
(3) The amount standing to the credit of the special reserve fund may be utilised by the Financial Coporation for only such purposes as are approved by the State Government and the Small Industries Bank.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
36. General meetings.—
(1) A general meeting (hereinafter re­ferred to as the annual general meeting) shall be held annually at a place in the State where there is an office of the Financial Corporation within 99 [four months] from the date on which the annual accounts of the Financial Corporation are closed, and a general meeting may be convened by the Board at any other time.
100 [(2) The shareholders present at the annual general meeting shall be entitled to discuss and adopt—
THE STATE FINANCIAL CORPORATIONS ACT, 1951
37. Audit.— 101 [
(1) The accounts of the Financial Corporation shall be audited by auditors duly qualified to act as the auditors under sub-section (1) of section 226 of the Companies Act, 1956 (1 of 1956), who shall be appointed by the Financial Corporation in general meeting of shareholders out of the panel of auditors approved by the Reserve Bank of India for such terms and on such remuneration as the Reserve Bank may fix.]
(2) Every auditor shall be supplied with a copy of the annual balance-sheet of the Financial Corporation, and it shall be his duty to examine it, together with the accounts and vouchers relating thereto, and every auditor shall have a list delivered to him of all books kept by the Financial Corporation and shall at all reasonable times have access to the books, accounts and other documents of the Financial Corporation and may in relation to such accounts examine any director or officer of the Financial Corporation.
(3) The auditors shall make a report to the shareholders upon the annual balance-sheet and accounts, and in every such report they shall state whether in their opinion the balance-sheet is a full and fair balance-sheet containing all necessary particulars and properly drawn up so as to exhibit a true and correct view of the state of affairs of the Financial Corporation, and in case they had called for any explanation or information from the Board, whether it has been given and whether it is satisfactory.
(4) The State Government may, in consultation with the Comptroll­er and Auditor-General of India, at any time issue directions to the auditors requiring them to report to it upon the adequacy of measures taken by the Financial Corporation for the protection of its shareholders and creditors or upon the sufficiency of their procedure in auditing the affairs of the Financial Corporation and may enlarge or extend the scope of the audit or direct that a different procedure in audit be adopted, or direct that any other examination be made by the auditors, if in its opinion public interest so requires.
(5) The Financial Corporation shall send a copy of every report of the auditors to the Comptroller and Auditor-General of India at least one month before it is placed before the shareholders.
(6) Notwithstanding anything contained in the preceding sub-sections, the Comptroller and Auditor-General of India may, either of his own motion or on a request received in this behalf from a State Government, undertake such audit and at such times as he may consider necessary: 102 [***]
(7) Every audit report under sub-section (6) shall be forwarded to the State Government and the Government shall cause the same to be laid before the Legislature of the State.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
103 [37A. Inspection.—
(1) The [Small Industries Bank] at any time may, with the approval of the Central Government, and on being direct­ed so to do by that Government shall cause an inspection to be made by one or more of its officers of the working of any Finan­cial Corporation and its books and accounts; and the 104 [Small Industries Bank] shall send the report of such inspection to the Cen­tral Government and to the State Government and shall supply a copy thereof to the Financial Corporation.
(2) It shall be the duty of every director or every officer of the Financial Corporation to produce to any officer making an inspection under sub-section (1) all such books, accounts and other documents in his custody or power and to furnish him with any statement and information relating to the affairs of the Financial Corporation as the said officer may require of him within such time as the said officer may specify.
(3) Notwithstanding anything contained in the Indian Evidence Act, 1872 (1 of 1872) or in any other law for the time being in force, no court, tribunal or other authority shall have power to require the 104 [Small Industries Bank] or any of its officers to produce before such court, tribunal or other authority the report of the inspection made by it under sub-section (1) or any copy thereof.
(4) The State Government may, after considering any report sent to it under sub-section (1), give such instructions to the Board as it considers necessary and it shall be the duty of the Board to comply with such instructions.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
38. Returns.— 105 [
(1) The Financial Corporation shall furnish to the State Government, the 106 [Small Industries Bank] and the Reserve Bank such statements and returns in such form as the State Government, the 106 [Small Industries Bank] or the Reserve Bank may require from time to time.]
(3) The Financial Corporation shall furnish 107 [to the State Gov­ernment, the 106 [Small Industries Bank] and the Reserve Bank] within 108 [four months] of the close of each financial year a statement in the prescribed form of its assets and liabilities as at the close of that year, together with a profit and loss account for the year, the auditors’ report and a report of the working of the Financial Corporation during the year and copies of the said statement, account and reports shall be published in the Official Gazette and shall also be laid before the Legislature of the State.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
39. Power to give instructions to Financial Corporation on ques­tions of policy.—
(1) In the discharge of its functions, the Board shall be guided by such instructions on questions of policy as may be given to it by the State Government 109 [in consultation with 110 [and after obtaining the advice of,] the 111 [Small Industries Bank]].
(2) If any dispute arises between the State Government and the Board as to whether a question is or is not a question of policy, the decision of the State Government shall be final.
(3) If the Board fails to carry out the instructions on the question of policy laid down by the State Government 109 [under sub-section (1) of this section or the instructions given to the Board under sub-section (4) of section 37A], the State Government shall have the power to supersede the Board and appoint a new Board in its place to function until a properly constituted Board is set up, and the decision of the State Government as to the grounds for superseding the Board shall not be questioned in any court.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
40. Declaration of fidelity and secrecy.— 113 [
THE STATE FINANCIAL CORPORATIONS ACT, 1951
41. Indemnity of directors.—
(1) Every director shall be indemni­fied by the Financial Corporation against all losses and expenses incurred by him in 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 Financial Corporation or for any loss or expenses resulting to the Financial Corporation by the insufficiency or deficiency of value of or title to any property or security acquired or taken on behalf of the Financial Corporation or by the wrongful act of any person under obligation to the financial corporation or by anything done in good faith in the execution of the duties of his office or in relation thereto.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
117 [41A. Protection of action taken by persons appointed under section 27 or section 32A.—No suit, prosecution or other legal proceeding shall lie against any person appointed as director, administrator, managing agent or manager by the Financial Corpo­ration in pursuance of section 27 or section 32A for anything which is in good faith done or intended to be done by him as such director, administrator, managing agent or manager.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951 THE STATE FINANCIAL CORPORATIONS ACT, 1951
42. Offences.—
(1) Whoever, in any bill of lading, warehouse re­ceipt or other document given to the Financial Corporation, whereby security is given or is purported to be given to the Financial Corporation for any accommodation granted by it under this Act, wilfully makes any false statement or knowingly permits any false statement to be made shall be punishable with imprison­ment for a term which may extend to two years, or with fine which may extend to two thousand rupees, or with both.
(2) Whoever, without the consent in writing of the Financial Corporation, uses the name of the Financial Corporation in any prospectus or advertisement shall be punishable with imprisonment which may extend to six months, or with fine which may extend to one thousand rupees, or with both.
(3) No court shall take cognizance of any offence punishable under this Act otherwise than on a complaint in writing signed by an officer of the Financial Corporation authorised by the Board in this behalf.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
43. Provisions relating to income-tax and super-tax.—For the purposes of the 119 [Income-tax Act, 1961(43 of 1961)], the Financial Corpora­tion shall be deemed to be a company within the meaning of that Act and shall be liable to income-tax and super-tax accordingly on its income, profits and gains: Provided that any sum paid by the State Government under the guarantee given in pursuance of 120 [***] 121 [section 7 or section 8] shall not be treated as the income, profits and gains of the Financial Corporation and any interest on debentures, 122 [bonds or deposits] paid by the Financial Corporation out of such sum shall not be treated as expenditure incurred by it: Provided further that in the case of any shareholder such portion of a dividend as has been paid out of any such sum advanced by the State Government shall be deemed to be 123 [his] income from “interest on securities” 124 [and the income-tax shall be payable thereon as if it were the interest receivable on any security of a State Government issued income-tax free] within the meaning of section 8 of that Act.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
125 [43A. Delegation of powers.—The Board may, by general or spe­cial order, delegate to the managing director or to any other officer of the Financial Corporation 126 [or to any committee ap­pointed under section 21] subject to such conditions and limita­tions, if any, as may be specified in the order such of its powers and duties under this Act as it may deem necessary.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
127 [43B. Reports to the Board.—
(1) The minutes of every meeting of the committee appointed under section 21 shall, after confirma­tion thereof at the next meeting of the committee, be laid before the Board at the next following meeting of the Board. 128 [***]]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
44. Act 18 of 1891 to apply to the books of the Financial Corpo­ration.—The Financial Corporation shall be deemed to be a bank for the purposes of the Bankers' Books Evidence Act, 1891 (18 of 1891).
THE STATE FINANCIAL CORPORATIONS ACT, 1951
45. Liquidation of Financial Corporation.—No provision of law relating to winding up of companies or corporations shall apply to the Financial Corporation, and the Financial Corporation shall not be placed in liquidation, save by order of the State Government and in such manner as it may direct.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
46. Power to apply Act to certain financial institutions in existence at commencement of Act.—
(1) The Central Government may by notification in the Official Gazette, direct that all or any of the provisions of this Act shall, subject to such exceptions and restrictions as may be specified, apply to 129 [any institution established by a State Government] which has for its object the financing of industrial concerns, and on the issue of such no­tification, the institution shall be deemed to be a Financial Corporation established by the State Government for the State within the meaning of this Act, and the provisions of this Act shall become applicable thereto according to the tenor of the notification: 130 [Provided that no notification shall be issued under this sub-section in respect of any institution unless a request is made in that behalf by the State Government concerned.]
(2) Any notification issued under sub-section (1) may suspend the operation of any enactment applicable to any such institution immediately before the issue of the notification.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
131 [46A. Extension of jurisdiction of the Financial Corporation to other States by agreement.—
(1) Where a Financial Corporation has been established for any State 132 [and one or more other States not served in whole or in part by a Financial Corporation] desires that the Financial Corporation 133 [should serve the needs of those States or of any area therein], and the States, after consulta­tion with the 134 [Small Industries Bank], enter into an agreement which is published in the Official Gazettes of each of those States, then the Financial Corporation shall, on the issue of a notifica­tion in the Official Gazette by the Central Government, serve the needs of those States 135 [or, as the case may be, of the area therein] in terms of the agreement 135 [and any Financial Corpora­tion or any State may enter into separate or successive agree­ments as aforesaid with one another or with other Financial Corporations of States and in relation to different areas of the States].
134 [(1A) Any agreement entered into under sub-section (1) may be modified or rescinded by mutual agreement between the parties thereto and every such mutual agreement shall also provide for the apportionment of assets and liabilities].
(2) An inter-State agreement among the participating States may, as far as may be, make all such provisions as are referred to in sub-section (2) of section 3A.
THE STATE FINANCIAL CORPORATIONS ACT, 1951
46B. Effect of Act on other laws.—The provision of this Act and of any rule or orders 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, but save as aforesaid, the provisions of this Act shall be in addi­tion to, and not in derogation of, any other law for the time being applicable to an industrial concern.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951 1[***] THE STATE FINANCIAL CORPORATIONS ACT, 1951
48. Power of Board to make regulations.—
(1) The Board may, after consultation with the 137 [Small Industries Bank] and with the previous sanction of the State Government, make regulations not inconsist­ent with this Act and the rules made thereunder to provide for all matters for which provision is necessary or expedient for the purpose of giving effect to the provisions of this Act.
(2) In particular, and without prejudice to the generality of the foregoing power, such regulations may provide for—
(a) the holding and conduct of elections under this Act, includ­ing the final decision on doubts or disputes regarding the valid­ity of elections;
(b) the manner in which, and the conditions subject to which, the first allotment of the shares of the Financial Corporation shall be made;
(c) the manner in which, and the conditions subject to which, the shares of the Financial Corporation may be held and trans­ferred and generally all matters relating to the rights and duties of shareholders;
(d) the manner in which general meetings shall be convened, the procedure to be followed thereat and the manner in which voting rights may be exercised;
(e) the calling of meetings of the Board, and of the Executive Committee, fees for attending meetings thereof and the conduct of business thereat;
(f) the manner and terms of issue and repayment of bonds and debentures by the Financial Corporation;
(g) the conditions which the Financial Corporations may impose in granting loans or advances; 139 [***]
(i) the forms of returns and statements required under this Act;
(j) the duties and conduct of officers, other employees, advis­ers and agents of the Financial Corporation;
(k) the establishment and maintenance of provident or other benefit funds for employees of the Financial Corporation;
(l) the taking over of the management of any industrial concern on a breach of its agreement with the Financial Corporation;
(m) the appointment of 140 [committees] for the purposes of this Act, 141 [fees for attending meetings thereof and the conduct of business thereat]; and
(n) generally, the efficient conduct of the affairs of the Financial Corporation.
143 [(3) All regulations made under this section shall be published in the Official Gazette and any such regulation shall have effect from such earlier or later date as may be specified in the regu­lations.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951
144 [48A. Laying of rules and regulations before State Legislature.— 145 [***] and every regula­tion made under section 48 shall be laid, as soon as may be after it is made, before the State Legislature.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951 THE STATE FINANCIAL CORPORATIONS ACT, 1951
147 [49. Power to remove difficulty.—If any difficulty arises in giving effect to the provisions of this Act, as amended by the Public Financial Institutions Laws (Amendment) Act, 1975 (52 of 1975), the Central Government may, by order, do anything, not inconsistent with such provisions, for the purpose of removing the difficulty: Provided that no such order shall be made after the expiration of three years from the commencement of the said Amendment Act.]
THE STATE FINANCIAL CORPORATIONS ACT, 1951 THE SCHEDULE [See section 40(3)] 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 a director, officer, employee or auditor (as the case may be) of the Financial Corporation and which properly relate to any office or position in the said Financial Corporation held by me. 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 Financial Corporation, nor will I allow any such person to inspect or have access to any books or documents belonging to or in the possession of the Financial Corporation and relating to the business of the Finan­cial Corporation. Signed before me Signature.
1. The words “except the State of Jammu and Kashmir ” omitted by Act 62 of 1956, sec. 2 and Sch. (w.e.f. 1-11-1956 ).
2. Ins. by Act 77 of 1972, sec. 2 (w.e.f. 30-12-1972 ).
3. Explanation renumbered as Explanation 1 by Act 43 of 1985, sec. 2 (w.e.f. 21-8-1985 ).
4. Subs. by Act 56 of 1956, sec. 3, for "acquire and to hold" (w.e.f. 1-10-1956 ).
5. Subs. by Act 52 of 1975, sec. 24, for "Reserve Bank" (w.e.f. 16-2-1976) and again subs. by Act 39 of 2000, sec. 3, for "Development Bank" (w.e.f. 5-9-2000).
6. Subs. by Act 39 of 2000, sec. 4, for sub-sections (1), (2) and (3) (w.e.f. 5-9-2000 ).
7. Subs. by Act 43 of 1985, sec. 4, for sub-section (5) (w.e.f. 21-8-1985 ).
8. Ins. by Act 77 of 1972, sec. 4 (w.e.f. 30-12-1972 ).
9. Subs. by Act 52 of 1975, sec. 26, for sub-section (1) (w.e.f. 16-2-1976 ).
10. Subs. by Act 39 of 2000, sec. 5, for "Development Bank" (w.e.f. 5-9-2000 ).
11. Subs. by Act 52 of 1975, sec. 26, for "Reserve Bank" (w.e.f. 16-2-1976) and again subs. by Act 39 of 2000, sec. 5, for "Development Bank" (w.e.f. 5-9-2000).
12. The words "section 47 or" omitted by Act 39 of 2000, sec. 5 (w.e.f. 5-9-2000 ).
13. Subs. by Act, 39 of 2000, sec. 5, for "sub-section (1) of section 6" (w.e.f. 5-9-2000 ).
14. Ins. by Act 52 of 1975, sec. 27 (w.e.f. 16-2-1976 ).
15. Ins. by Act 39 of 2000, sec. 6 (w.e.f. 5-9-2000 ).
16. Ins. by Act 39 of 2000, sec. 6 (w.e.f. 5-9-2000 ).
17. Ins. by Act 39 of 2000, sec. 6 (w.e.f. 5-9-2000 ).
18. Ins. by Act 39 of 2000, sec. 6 (w.e.f. 5-9-2000).
19. Ins. by Act 39 of 2000, sec. 6 (w.e.f. 5-9-2000).
20. Ins. by Act 39 of 2000, sec. 6 (w.e.f. 5-9-2000).
21. Subs. by Act, 39 of 2000, sec. 7, for section 5 (w.e.f. 5-9-2000).
22. Subs. by Act 39 of 2000, sec. 7, for section 6 (w.e.f 5-9-2000).
23. Section 7 subs. by Act 6 of 1962, sec. 5 (w.e.f. 16-4-1962) and again subs. by Act. 39 of 2000, sec. 7 (w.e.f. 5-9-2000).
24. Section 8 subs. by Act 6 of 1962, sec. 5 (w.e.f. 16-4-1962) and again subs. by Act 39 of 2000, sec. 7 (w.e.f. 5-9-2000).
25. Subs. by Act 39 of 2000, sec. 7, for section 9 (w.e.f. 5-9-2000).
26. Subs. by Act 39 of 2000, sec. 7, for section 10 (w.e.f. 5-9-2000).
27. Section 10A ins by Act 43 of 1985, sec. 10 (w.e.f. 21-8-1985), and omitted by Act 39 of 2000,
28. Subs. by Act 39 of 2000, sec. 9, for sections 11 and 12 (w.e.f. 5-9-2000).
29. Section 13 renumbered as sub-section (1) thereof by Act 39 of 2000, sec. 10 (w.e.f. 5-9-2000).
30. Ins. by Act 39 of 2000, sec. 10 (w.e.f. 5-9-2000).
31. Subs. by Act 39 of 2000, sec. 11, for sub-sections (1) and (1A) (w.e.f. 5-9-2000). Sub-section (1A) was ins. by Act 56 of 1956, sec. 8 (w.e.f. 1-10-1956).
32. Subs. by Act 39 of 2000, sec. 12, for section 15 (w.e.f. 5-9-2000).
33. Subs. by Act 6 of 1962, sec. 7, for section 16 (w.e.f. 16-4-1962).
34. Section 17 renumbered as sub-section (1) of that section by Act 56 of 1956, sec. 9 (w.e.f. 1-10-1956) and subs. by Act 39 of 2000, sec. 13 (w.e.f. 5-9-2000).
35. Ins. by Act 56 of 1956, sec. 9 (w.e.f. 1-10-1956).
36. Ins. by Act 39 of 2000, sec. 13 (w.e.f. 5-9-2000).
37. Subs. by Act 39 of 2000, sec. 14, for section 18 (w.e.f. 5-9-2000).
38. Sub-section (3A) ins. by Act 56 of 1956, sec. 11 (w.e.f. 1-10-1956) and omitted by Act 39 of 2000, sec. 15 (w.e.f. 5-9-2000).
39. Sub-section (4) subs. by Act 6 of 1962, sec. 9 (w.e.f. 16-4-1962) and omitted by Act 39 of 2000, sec. 15 (w.e.f. 5-9-2000).
40. Ins. by Act 6 of 1962, sec. 9 (w.e.f. 16-4-1962).
41. The words ", not being the managing director" omitted by Act 43 of 1985, sec. 12 (w.e.f. 21-8-1985).
42. Subs. by Act 43 of 1985, sec. 13, for "shall be laid" (w.e.f. 21-8-1985).
43. Subs. by Act 43 of 1985, sec. 14, for "one or more advisory committee or committees" (w.e.f. 21-8-1985).
44. Subs. by Act 77 of 1972, sec. 13, for section 22 (w.e.f. 30-12-1972).
45. Proviso added by Act 77 of 1972, sec. 14 (w.e.f. 30-12-1972) and omitted by Act 39 of 2000, sec. 16 (w.e.f. 5-9-2000).
46. Subs. by Act 6 of 1962, sec. 10, for section 25 (w.e.f. 16-4-1962).
47. Subs. by Act 39 of 2000, sec. 17, for sub-section (1) (w.e.f. 5-9-2000).
48. Sub-section (2) of section 25 as it stood before its substitution by Act 39 of 2000 was omitted by Act 43 of 1985, sec. 15 (w.e.f. 21-8-1985).
49. Subs. by Act 77 of 1972, sec. 15, for “and (c)” (w.e.f. 30-12-1972).
50. Subs. by Act 52 of 1975, sec. 35, for “Reserve Bank” (w.e.f. 16-2-1976) and again subs. by Act 39 of 2000 sec. 17, for "Development Bank" (w.e.f. 5-9-2000).
51. Ins. by Act 77 of 1972, sec. 15 (w.e.f. 30-12-1972).
52. Ins. by Act 43 of 1985, sec. 16 (w.e.f. 21-8-1985).
53. Ins. by Act, 39 of 2000, sec. 18 (w.e.f. 5-9-2000).
54. Section 26 subs. by Act 6 of 1962, sec. 11 (w.e.f. 16-4-1962) and again subs. by Act 39 of 2000, sec. 19 (w.e.f. 5-9-2000).
55. Subs. by Act 77 of 1972, sec. 17, for sub-section (2) (w.e.f. 30-12-1972).
56. Section 28 re-numbered as sub-section (1) thereof by Act 77 of 1972, sec. 18 (w.e.f.
57. Subs. by Act 6 of 1962, sec. 13, for clauses (a) and (b) (w.e.f. 16-4-1962).
58. Ins. by Act 77 of 1972, sec. 18 (w.e.f. 30-12-1972).
59. Clause (d) ins. by Act 77 of 1972, sec. 18 (w.e.f. 30-12-1972) and subs. by Act 39 of 2000,
60. Ins. by Act 77 of 1972, sec. 19 (w.e.f. 30-12-1972).
61. Subs. by Act 77 of 1972, sec. 19, for “right to take over the management of the industrial concern" (w.e.f. 30-12-1972).
62. Subs. by Act 56 of 1956, sec. 14, for “right to sell” (w.e.f. 1-10-1956).
63. The words “of sale and realisation” omitted by Act 56 of 1956, sec.14 (w.e.f. 1-10-1956).
64. Subs. by Act 56 of 1956, sec. 14, for “as if the sale” (w.e.f. 1-10-1956).
65. Subs. by Act 56 of 1956, sec. 14, for sub-section (4) (w.e.f. 1-10-1956).
66. Subs. by Act 77 of 1972, sec. 19, for certain words (w.e.f. 30-12-1972).
67. Subs. by Act 6 of 1962, sec. 14, for “charges and expenses properly incurred” (w.e.f.
68. Subs by Act 77 of 1972, sec. 19, for "as incidental to such management, or transfer and realisation".
69. The words “from such management, or transfer and realisa­tion” omitted by Act 77 of 1972, sec. 19 (w.e.f. 30-12-1972).
70. Subs. by Act 6 of 1962, sec. 14, for “the owner of the con­cern” (w.e.f. 16-4-1962).
71. Ins. by Act 77 of 1972, sec. 20 (w.e.f. 30-12-1972).
72. Ins. by Act 56 of 1956, sec. 15 (w.e.f 1-10-1956).
73. Subs. by Act 56 of 1956, sec. 15, for “Corporation” (w.e.f. 1-10-1956).
74. Ins. by Act 43 of 1985, sec. 19 (w.e.f 21-8-1985).
75. Ins. by Act 43 of 1985, sec. 20 (w.e.f. 21-8-1985).
76. Subs. by Act 43 of 1985, sec. 20, for sub-section (4) (w.e.f. 21-8-1985).
77. The word “or” omitted by Act 43 of 1985, sec. 20 (w.e.f. 21-8-1985).
78. Ins. by Act 56 of 1956, sec. 16 (w.e.f. 1-10-1956).
79. Subs. by Act 43 of 1985, sec. 20, for “under sub-section (5)” (w.e.f. 21-8-1985).
80. Subs. by Act 6 of 1962, sec. 15, for sub-section (11) (w.e.f. 16-4-1962).
81. Ins. by Act 77 of 1972, sec. 21 (w.e.f. 30-12-1972).
82. Ins. by Act 56 of 1956, sec. 17 (w.e.f. 1-10-1956).
83. Ins. by Act 6 of 1962, sec. 16 (w.e.f. 16-4-1962).
84. Ins. by Act 56 of 1956, sec. 17 (w.e.f. 1-10-1956).
85. Ins. by Act 56 of 1956, sec. 17 (w.e.f. 1-10-1956).
86. Ins. by Act 56 of 1956, sec. 17 (w.e.f. 1-10-1956).
87. Ins. by Act 56 of 1956, sec. 17 (w.e.f. 1-10-1956).
88. Ins. by Act 56 of 1956, sec. 17 (w.e.f. 1-10-1956).
89. Ins. by Act 56 of 1956, sec. 17 (w.e.f. 1-10-1956).
90. Ins. by Act 43 of 1985, sec. 21 (w.e.f. 21-8-1985).
91. Subs. by Act 6 of 1962, sec. 17, for “or with any agency of the Reserve Bank other than a Government treasury” (w.e.f. 16-4-1962).
92. Ins. by Act 77 of 1972, sec. 22 (w.e.f 30-12-1972).
93. Ins. by Act 43 of 1985, sec. 22 (w.e.f. 21-8-1985).
94. Subs. by Act 56 of 1956, sec. 18, for “or in a scheduled bank in consultation with the Reserve Bank” (w.e.f. 1-10-1956).
95. Subs. by Act 39 of 2000, sec. 21, for section 34 (w.e.f. 5-9-2000).
96. The proviso omitted by Act 39 of 2000, sec. 22 (w.e.f. 5-9-2000).
97. Sub-section (3) omitted by Act 77 of 1972, sec. 23 (w.e.f. 30-12-1972).
98. Section 35A ins. by Act 6 of 1962, sec. 19 (w.e.f. 16-4-1962) and subs. by Act 39 of 2000,
99. Subs. by Act 43 of 1985, sec. 24, for “three months” (w.e.f. 21-8-1985).
100. Subs. by Act 39 of 2000, sec. 24, for sub-section (2) (w.e.f. 5-9-2000).
101. Sub-section (1) subs. by Act 77 of 1972, sec. 25 (w.e.f. 3-12-1972) and again subs. by Act 39 of 2000, sec. 25 (w.e.f. 5-9-2000).
102. Proviso omitted by Act 39 of 2000, sec. 25 (w.e.f. 5-9-2000).
103. Ins. by Act 56 of 1956, sec. 21 (w.e.f. 1-10-1956).
104. Subs. by Act 52 of 1975, sec. 37, for “Reserve Bank” (w.e.f. 16-2-1976) and again subs. by Act 39 of 2000, sec. 26, for "Development Bank" (w.e.f. 5-9-2000).
105. Subs by Act 43 of 1985, sec. 25, for sub-sections (1) and (2) (w.e.f. 21-8-1985).
106. Subs. by Act 39 of 2000, sec. 27, for "Development Bank" (w.e.f. 5-9-2000).
107. Subs. by Act 52 of 1975, sec. 38, for "to the State Government and to the Reserve Bank" (w.e.f. 16-2-1976).
108. Subs. by Act 56 of 1956, sec. 22, for "three months" (w.e.f. 1-10-1956).
109. Ins. by Act 56 of 1956, sec. 23 (w.e.f. 1-10-1956).
110. Ins. by Act 77 of 1972, sec. 26 (w.e.f. 30-12-1972).
111. Subs. by Act 52 of 1975, sec. 37, for "Reserve Bank" (w.e.f. 16-2-1976) and again subs by Act 39 of 2000, sec. 28, for "Development Bank" (w.e.f. 5-9-2000).
112. Ins. by Act 39 of 2000, sec. 28 (w.e.f. 5-9-2000).
113. Ins. by Act 48 of 1983, sec. 6 (w.e.f. 30-12-1983).
114. Subs. by Act 39 of 2000, sec. 29, for "State Co-operative Bank or the Development Bank" (w.e.f. 5-9-2000).
115. Section 40 renumbered as sub-section (3) thereof by Act 48 of 1983, sec. 6 (w.e.f. 30-12-1983).
116. Ins. by Act 30 of 2005, sec. 34 and Sch., Pt. III.
117. Ins. by Act 6 of 1962, sec. 21 (w.e.f. 16-4-1962).
118. Ins. by Act 39 of 2000, sec. 30 (w.e.f. 5-9-2000).
119. Subs. by Act 43 of 1985, sec. 26, for “Indian Income-tax Act, 1922 (11 of 1922)” (w.e.f. 21-8-1985).
120. The words "Section 6 or" omitted by Act 39 of 2000, sec. 31 (w.e.f. 5-9-2000).
121. Subs. by Act 6 of 1962, sec. 22, for certain words (w.e.f. 16-4-1962).
122. Subs. by Act 6 of 1962, sec. 22, for “or bonds” (w.e.f. 16-4-1962).
123. Subs. by Act 48 of 1952, sec. 3 and Sch. II, for “its” (w.e.f. 2-8-1952).
124. Subs. by Act 6 of 1962, sec. 22, for “declared to be income-tax free” (w.e.f. 16-4-1962).
125. Ins. by Act 6 of 1962, sec. 23 (w.e.f. 16-4-1962).
126. Ins. by Act 43 of 1985, sec. 27 (w.e.f. 21-8-1985).
127. Ins. by Act 43 of 1985, sec. 28 (w.e.f. 21-8-1985).
128. Sub-section (2) omitted by Act 39 of 2000, sec. 32 (w.e.f. 5-9-2000).
129. Subs. by Act 43 of 1985, sec. 29, for "any institution in existence at the commencement of this Act" (w.e.f. 21-8-1985).
130. Ins. by Act 43 of 1985, sec. 29 (w.e.f. 21-8-1985).
131. Ins. by Act 56 of 1956, sec. 24 (w.e.f. 1-10-1956).
132. Subs. by Act 77 of 1972, sec. 27, for “and any other State” (w.e.f. 30-12-1972).
133. Subs. by Act 77 of 1972, sec. 27, for “should serve its needs” (w.e.f. 30-12-1972).
134. Subs. by Act 52 of 1975, sec. 37, for "Reserve Bank" (w.e.f. 16-2-1976) and again subs. by Act 39 of 2000, sec. 33, for "Development Bank" (w.e.f. 5-9-2000).
135. Ins. by Act 77 of 1972, sec. 27 (w.e.f. 30-12-1972).
136. Section 47 omitted by Act 39 of 2000, sec. 34 (w.e.f. 5-9-2000).
137. Subs. by Act 52 of 1975, sec. 37, for “Reserve Bank” (w.e.f. 16-2-1976) and again subs by Act 39 of 2000, sec. 35, for "Development Bank" (w.e.f. 5-9-2000).
138. Ins. by Act 39 of 2000, sec. 35 (w.e.f. 5-9-2000).
139. Clause (h) omitted by Act 43 of 1985, sec. 30 (w.e.f. 21-8-1985).
140. Subs. by Act 43 of 1985, sec. 30, for "advisory committees for techincal and other advice" (w.e.f. 21-8-1985).
141. Ins. by Act 56 of 1956, sec. 25 (w.e.f. 1-10-1956).
142. Ins. by Act 39 of 2000, sec. 35 (w.e.f. 5-9-2000).
143. Subs. by Act 77 of 1972, sec. 28, for sub-section (3) (with retrospective effect).
144. Ins. by Act 4 of 1986, sec. 2 and Sch. (w.e.f. 15-5-1986).
145. The words "Every rule made under section 47 and "omitted by Act 39 of 2000, sec. 36
146. Ins. by Act 39 of 2000, sec. 37 (w.e.f. 5-9-2000 ).
147. Ins. by Act 52 of 1975, sec. 39 (w.e.f. 16-2-1976 ).
148. Subs. by Act 48 of 1983, sec. 6, for "(See section 40)" (w.e.f. 30-12-1983).