The Industrial Development Bank of India Act, 1964

FREE EXCERPT

THE INDUSTRIAL DEVELOPMENT BANK OF INDIA ACT, 1964 ACT NO. 18 OF 1964

[16th May, 1964.] BE

An Act to establish the Industrial Development Bank of India 1*[as the principal financial institution for co-ordinating, in conformity with national priorities, the working of institutions engaged in financing, promoting or developing industry, for assisting the development of such institutions] for providing credit and other facilities for the development of industry and for matters connected therewith and further to amend certain enactments.

CHAP

PRELIMINARY

CHAPTER I

PRELIMINARY

1.

Short title, extent and commencement.

1. Short title, extent and commencement.- (1) This Act may be called the Industrial Development Bank of India Act, 1964.

(2) It extends to the whole of India.

(3) It shall come into force on such date 2* as the Central Government may, by notification in the Official Gazette, appoint and different dates may be appointed for different provisions of this Act.

2.

Definitions.

2. Definitions.- In this Act, unless the context otherwise requires,--

(a) "Board" means the Board of Directors of the Development Bank;

(b) "Development Bank" means the Industrial Development Bank of India established under section 3;

3*[(c) "industrial concern" means any concern engaged or to be engaged in,--

(i) the manufacture, preservation or processing of goods;

[See footnote 1 for this section]

(ii) shipping;

1*[(iii) mining including development of mines]

(iv) the hotel industry;

2*[(v) the transport of passengers or goods by road or by water or [by air or by ropeway or by life]

1*[(vi) the generation, storage or distribution of electricity or any other form of energy;]

(vii) the maintenance, repair, testing or servicing of 3*[machinery or equipment] of any description or vehicles or vessels or motor boats or trailers or tractors;

(viii) assembling, repairing or packing any article with the aid of machinery or power;

1*[(ix) the setting up of, or development of, an industrial area or an industrial estate;]

(x) fishing or providing shore facilities for fishing maintenance thereof;

(xi) providing special or technical knowledge or other services for the promotion of industrial growth; or 1*[(xii) providing engineering, technical, financial, management, marketing or other services or facilities for industry;

(xiii) service industry such as altering, ornamenting, polishing, finishing, oiling, washing, cleaning or otherwise treating or adapting any article or substance with a view to its use, sale, transport, delivery or disposal;

(xiv) providing medical, health or other allied services;

(xv) providing services relating to information technology, telecommunication or electronics;

(xvi) leasing, sub-leasing or giving on hire or hire-

purchase of industrial plants, equipments, machinery or other assets including vehicles, ships and aircraft;

(xvii) such other activity as the Central Government may, having regard to the objects of this Act, by notification in the Official Gazette, specify in this behalf; or (xviii) the research and development of any concept, technology, design, process or product whether in relation to any of the matters aforesaid, including any activities specified under sub-clause (xvii), or any other matter.

Explanation.--The expression "processing of goods" includes any art or process for producing, preparing or making an article by subjecting any material to a manual, mechanical, chemical, electrical or any other like operation.]

3*[(d) "Industrial Finance Corporation" means the Industrial Finance Corporation of India Limited formad and registered under the companies Act (1956 (1 of 1956).

4*[(da) "nationalised bank" means a corresponding new bank specified in the First Schedule to the Banking Companies (Acquisition and Transfer of Undertakings)

Act, 1970 (5 of 1970) or a corresponding new bank specified in the First Schedule to the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980);]

(e)"prescribed" means prescribed by regulations made under this Act;

(f) "Reserve Bank" means the Reserve Bank of India constituted under the Reserve Bank of India Act, 1934 (2 of 1934);

[See footnote 2 for this section]

231 (g)"scheduled bank" means a bank for the time being included in the Second Schedule to the Reserve Bank of India Act, 1934; (2 of 1934)

1*[(ga) "State Bank" means the State Bank of India constituted under the State Bank of India Act, 1955;

(23 of 1955.)

(gb) "subsidiary bank" has the meaning assigned to it in the State Bank of India (Subsidiary Banks) Act, 1959; (38 of 1959.)]

(h) "State co-operative bank" has the same meaning as in the Reserve Bank of India Act, 1934; (2 of 1934.)

(i)"State Financial Corporation" means a financial corporation established under section 3 or section 3A

of the State Financial Corporation Act, 1951 (63 of 1951.) and includes the 2*[Tamil Nadu] Industrial Investment Corporation Limited;

1*[(j)"Unit Trust" means the Unit Trust of India established under section 3 of the Unit Trust of India Act, 1963.

(52 of 1963.)]

CHAP

ESTABLISHMENT OF THE INDUSTRIAL DEVELOPMENT BANK OF INDIA AND CAPITALTHEREOF

CHAPTER II

ESTABLISHMENT OF THE INDUSTRIAL DEVELOPMENT BANK OF INDIA AND

CAPITAL THEREOF

3.

Establishment and incorporation of Industrial Development Bank ofIndia.

3. Establishment and incorporation of Industrial Development Bank of India. (1) With effect from such date 3* 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 Development Bank of India.

(2) The Development 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 or be sued.

(3) The head office of the Development Bank shall be at Bombay or at such other place as the 4*[Central Government] may, by notification in the Official Gazette, specify.

[See footnote 3 for this section]

(4) The Development Bank may establish offices, branches or agencies at any 4*xxx place in or outside India.

4.

Authorised capital.

1*[4. Authorised capital. The authorrised capital of the Development bank shall be [one thousand crores of rupees] 5*

Provided that the Central Government may, by notification in the Official Gazette, increase the said capital up to 5*[two thousand crores of rupees] 3*.

4A.

Transfer of capital to Central Government.

4A. Transfer of capital to Central Government. (1) The issued capital of the Development Bank which has been subscribed by the Reserve Bank as on the date immediately preceding the commencement of section 5 of the Public Financial Institutions Laws (Amendment) Act, 1975 (52 of 1975.) (hereinafter referred to as the "appointed day"), shall, on such commencement, stand transferred to, and vested in, the Central Government.

(2) Any further issue of capital made by the Development Bank after the appointed day shall be wholly subscribed by the Central Government.

4B.

Payment of amount.

4B. Payment of amount. The Reserve Bank shall be given by the Central Government, in cash, for the transfer to, and vesting in, the Central Government of the issued capital of the Development Bank which has been subscribed by the Reserve Bank, an amount equal to the face value of the said subscribed capital.]

CHAP

MANAGEMENT OF THE DEVELOPMENT BANK

CHAPTER III

MANAGEMENT OF THE DEVELOPMENT BANK

5.

Management.

5. Management. (1) The general superintendence, direction and management of the affairs and business of the Development 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 Development Bank.

2*[(2) Save as otherwise provided in regulations made under this Act,--

(a) the chairman, if he is a whole-time director or if he is holding offices both as the chairman and the managing director, or

[See footnote 4 for this section]

(b) the managing director, if the chairman is not a whole-

time director, or, if the chairman being a whole-time director, is absent, shall also have powers of general superintendence, direction and management of the affairs and business of the Development Bank and may also exercise all powers and do all acts and things which may be exercised or done by the Development 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.

1*[(4) In the discharge of its functions under this Act, the Development Bank shall be guided by such directions in matters of policy involving public interest as the Central Government may give to it in writing.]

6.

Constitution of Board.

2*[6. Constitution of Board. (1) The Board shall consist of the following, namely:--

(a) a chairman and a managing director appointed by the Central Government:

Provided that the same person may be appointed to function both as chairman and as managing director;

(b) a Deputy Governor of the Reserve Bank nominated by that Bank;

(c) not more than twenty directors nominated by the Central Government of whom--

(i) two directors shall be officials of the Central Government;

(ii) not more than five directors shall be from financial institutions;

(iii) two directors shall be from amongst the employees of the Development Bank and the financial institutions, and of such directors, one shall be from amongst the officer employees and the other from amongst the workmen employees, selected in such manner as may be prescribed;

(iv) not more than six directors shall be from the State Bank, the nationalised banks and the State Financial Corporations;

[See footnote 5 for this section]

(v) not less than five directors shall be persons who have special knowledge of, and professional experience in, science, technology, economics, industry, industrial co-operatives, law, industrial finance, investment, accountancy, marketing or any other matter, the special knowledge...

To continue reading

REQUEST YOUR FREE TRIAL