Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 19881
| [Act 66 of 1988] | [19th December, 1988] |
An Act further to amend the Negotiable Instruments Act, 1881, the Reserve Bank of India Act, 1934, the Banking Regulation Act, 1949, the State Bank of India Act, 1955, the State Bank of India (Subsidiary Banks) Act, 1959, the Deposit Insurance and Credit Guarantee Corporation Act, 1961, the Industrial Development Bank of India Act, 1964, the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, the Regional Rural Banks Act, 1976, the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980, the Export-Import Bank of India Act, 1981, the National Bank for Agriculture and Rural Development Act, 1981 and the Industrial Reconstruction Bank of India Act, 1984
Be it enacted by Parliament in the Thirty-ninth Year of the Republic of India as follows:-
1 Received the assent of the President on December 19, 1988.
Prefatory Note-Statement of Objects and Reasons.-The Banking laws were last amended through the Banking Laws (Amendment) Act, 1985 (81 of 1985), the various provisions of which were brought into force on different dates in 1985 and 1986. Since then, in the course of administering various laws relating to banks and public financial institutions, a need has arisen for some further amendments to the Negotiable Instruments Act, 1881, the Reserve Bank of India Act, 1934, the Banking Regulation Act, 1949, the State Bank of India Act, 1955, the State Bank of India (Subsidiary Banks) Act, 1959, the Deposit Insurance and Credit Guarantee Corporation Act, 1661, the Industrial Development Bank of India Act, 1964, the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, the Regional Rural Banks Act, 1976, the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980, the Export-Import Bank of India Act, 1981, the National Bank for Agriculture and Rural Development Act, 1981 and the Industrial Reconstruction Bank of India Act, 1984, to achieve the following objectives:
(i) To enable the Government to increase the paid-up capital of the nationalised banks so as to improve the banks' debt: equity ratio and profitability;
(ii) to invest the Reserve Bank of India with powers to have special audits of banks carried out whenever considered necessary in the public interest or in the interests of the banking company or its depositors either by the banks' auditor or any other auditor specially appointed for the purpose;
(iii) to provide uniform tenure to all non-official directors and employee directors on the Boards of the State Bank of India and its subsidiary banks and certain financial institutions and to limit their continuous membership of the Board of Directors of a bank or institution in keeping with the principle enunciated by the Estimates Committee;
(iv) to empower the Central Government to change the accounting year of any bank or financial institution by notification in the Official Gazette which would enable the Central Government to change the present accounting year of banks and financial institutions to coincide with the financial year (April-March) which is envisaged as the previous year for income tax purposes;
(v) to provide transfer of whole or part of the undertaking of one corresponding new bank to another corresponding new bank;
(vi) to obviate avoidable delays by omitting the requirement of prior consultation with the State Bank of India or the Reserve Bank of India, as the case may be, in the matter of nomination or appointment of officials of the Central Government on the Boards of Directors of Subsidiary Banks of the State Bank of India and the National Bank for Agriculture and Rural Development as obtaining in other analogous statutes;
(vii) to provide for making of the regulations by the Board of Directors of the banks and financial institutions by notification in the Official Gazette;
(viii) to enable the Reserve Bank of India to make regulations to govern Clearing Houses which have as members, besides scheduled banks, other banks and post office savings banks;
(ix) to amend the Reserve Bank of India Act, 1934 to omit the ceiling on the quantum of loans and advances which could be made by the Reserve Bank of India to the Industrial Finance Corporation of India;
(x) to revise the rate of interest from the present level of six per cent to eighteen per cent per annum payable on a negotiable instrument from the due date in case no rate of interest is specified, or payable to an indorser from the date of payment on a negotiable instrument on its dishonour with a view to discouraging the withholding of payment on negotiable instruments on due dates;
(xi) to enhance the acceptability of cheques in settlement of liabilities by making the drawer liable for penalties in case of bouncing of cheques due to insufficiency of funds in the accounts or for the reason that it exceeds the arrangements made by the drawer, with adequate safeguards to prevent harassment of honest drawers.
(xii) to empower the Chairman, National Bank for Agriculture and Rural Development (NABARD) to exercise the powers and discharge the functions also of the Managing Director, NABARD, during the period of any casual vacancy in the office of Managing Director, NABARD, for smooth functioning of NABARD.
2. The notes on clause explain in detail the various provisions contained in the Bill.
CHAPTER 1- PRELIMINARY
1. Short title and commencement.-(1) This Act may be called the Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988.
(2) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint, and different dates may be appointed for different provisions of this Act.
CHAPTER 2- AMENDMENTS TO THE NEGOTIABLE INSTRUMENTS ACT, 1881
2. Amendment of Section 80.-In Section 80 of the Negotiable Instruments Act, 1881 (26 of 1881), (hereinafter in this Chapter referred to as the Negotiable Instruments Act), for the words "six per centum", the words "eighteen per centum" shall be substituted.
3. Amendment of Section 117.-In Section 117 of the Negotiable Instruments Act, in clause (c), for the words "six per centum", the words "eighteen per centum" shall be substituted.
4. Insertion of new Chapter XVII.-In the Negotiable Instruments Act, after Chapter XVI, the following Chapter shall be inserted, namely:-
"Chaper XVII
Of Penalties in case of Dishonour of Certain Cheques for Insufficiency of Funds in the Accounts
138. Dishonour of cheque for insufficiency, etc., of funds in the account.-Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for a term which may extend to one year, or with fine which may extend to twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply unless-
(a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier;
(b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, within fifteen days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and
(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque within fifteen days of the receipt of the said notice.
Explanation.-For the purpose of this section, "debt or other liability" means a legally enforceable debt or other liability.
139. Presumption in favour of holder.- It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability.
140. Defence which may not be allowed in any prosecution under Section 138.-It shall not be a defence in a prosecution for an offence under Section 138 that the drawer had no reason to believe when he issued the cheque that the cheque may be dishonoured on presentment for the reasons stated in that section.
141. Offences by companies.-(1) If the person committing an offence under Section 138 is a company, every person who, at the time the offence was committed, was in charge of, and was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against the punished accordingly:
Provided that nothing contained in this sub-section shall render any person liable to punishment if he proves that the offence was committed without his knowledge, or that he had exercised all due diligence to prevent the commission of such offence.
(2) Notwithstanding anything contained in sub-section (1), where any offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to, any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.
Explanation.-For the purposes of this section,-
(a) "company" means any body corporate and includes a firm or other association of individuals; and
(b) "director", in relation to a firm, means a partner in the firm.
142. Cognizance of offences.-Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974),-
(a) no court shall take cognizance of any offence punishable under Section 138 except upon a complaint, in writing, made by the payee or, as the case may be, the holder in the due course of the cheque;
(b) such complaint is made within one month of the date on which the cause of action arises under clause (c) of the proviso to Section 138;
(c) no court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the first class shall try any offence punishable under Section 138.".
CHAPTER 3 - AMENDMENTS TO THE RESERVE BANK OF INDIA ACT, 1935
5. Amendment of Section 17.-In Section 17 of the Reserve Bank of India Act, 1934 (2 of 1934), (hereinafter in this Chapter referred to as the Reserve Bank Act), in clause (4-B), the proviso shall be omitted.
CHAPTER 3 - AMENDMENTS TO THE RESERVE BANK OF INDIA ACT, 1934
6. Amendment of Section 58.-In Section 58 of the Reserve Bank Act,-
(a) in sub-section (1), after the words "the Central Government,", the words "by notification in the Official Gazette," shall be inserted;
(b) in sub-section (2), in clause (p), for the words "the scheduled banks", the words and brackets "banks (including post office savings banks)" shall be substituted.
CHAPTER 4 - AMENDMENTS TO THE BANKING REGULATION ACT, 1949
7. Amendment of Section 11.-In Section 11 of the Banking Regulation Act, 1949 (10 of 1949), (hereinafter in this Chapter referred to as the Banking Regulation Act), in sub-section (2), in clause (b), in sub-clause (ii), the word "calendar" shall be omitted.
8. Amendment of Section 29.-In Section 29 of the Banking Regulation Act,-
(a) in sub-section (1),-
(i) in the opening paragraph,-
(A) after the words "each calendar year", the words "or at the expiration of a period of twelve months ending with such date as the Central Government may, by notification in the Official Gazette, specify in this behalf," shall be inserted;
(B) for the words "that year", the words "that year or period, as the case may be," shall be substituted;
(C) for the words "the year", the words "the year or the period, as the case may be," shall be substituted;
(ii) for the proviso, the following proviso shall be substituted, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this sub-section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the preparation of, or for other matters relating to, the balance sheet or profit and loss account in respect of the concerned year or period, as the case may be.";
(b) after sub-section (3-A), the following Explanation shall be inserted, namely:-
"Explanation.-In sub-section (3-A), ‘year’ means the year or, as the case may be, the period referred to in sub-section (1)."
9. Amendment of Section 30.-In Section 30 of the Banking Regulation Act,-
(a) in sub-section (1-B), for the portion beginning with the words "it may direct" and ending with the words "specified in the order", the following shall be substituted, namely:-
"it may at any time by order direct that a special audit of the banking company's accounts, for any such transaction or class of transactions or for such period or periods as may be specified in the order, shall be conducted and may by the same or a different order either appoint a person duly qualified under any law for the time being in force to be an auditor of companies or direct the auditor of the banking company himself to conduct such special audit";
(b) in sub-section (1-C), for the words "the audit of the transaction or class of transactions", the words "the special audit" shall be substituted;
(c) in sub-section (2), the words, "and auditors, if any, appointed by the law establishing, constituting or forming the banking company concerned" shall be inserted at the end.
10. Amendment of Section 51.-In Section 51 of the Banking Regulation Act, for the figure "31" the words, brackets, figures and letters "sub-sections (1-B), (1-C) and (2) of Sections 30, 31" shall be substituted.
11. Amendment of Third Schedule.-In the Third Schedule to the Banking Regulation Act, in Form B, in the portion appearing after the heading "FORM OF PROFIT AND LOSS ACCOUNT", the word "December" shall be omitted.
CHAPTER 5 - AMENDMENTS TO THE STATE BANK OF INDIA ACT, 1955
12. Amendment of Section 20.-In Section 20 of the State Bank of India Act, 1955 (23 of 1955), (hereinafter in this Chapter referred to as the State Bank Act),-
(a) in sub-section (3),-
(i) the words, brackets and figure "and in sub-section (5)" shall be omitted;
(ii) for the words, figures, brackets and letter "Section 19 or nominated under clause (d) of that sub-section" and "four years", the words "that section" and "three years" shall, respectively, be substituted;
(iii) the words "or nominated" and "or renomination" shall be omitted;
(iv) the following proviso shall be inserted at the end, namely:-
"Provided that no such director shall hold office continuously for a period exceeding six years.";
(b) in sub-section (3-A),-
(i) for the words "A director", the words, brackets and figure "Subject to the provisions contained in sub-section (4), a director" shall be substituted;
(ii) after the word and figures "Section 19", the words, brackets and letter "or nominated under clause (d) of that sub-section" shall be inserted;
(iii) for the words "duly appointed" and "for reappointment", the words "duly appointed or nominated" and "for reappointment or re-nomination, as the case may be" shall, respectively, be substituted;
(iv) the following proviso shall be inserted at the end, namely:-
"Provided that no such director shall hold office continuously for a period exceeding six years.";
(c) for sub-section (4), the following sub-section shall be substituted, namely:-
"(4) A director appointed under clause (ca) or clause (cb) of sub-section (1) of Section 19 or nominated under clause (d) or clause (e) or clause (f) of that sub-section shall hold office during the pleasure of the authority appointing or nominating him, as the case may be.";
(d) sub-section (5) shall be omitted.
1[13. Amendment of Section 21-A.-In Section 21-A of the State Bank Act,-
(a) for sub-section (1), the following sub-section shall be substituted, namely:-
"(1) Subject to the provisions contained in this section and in sub-section (2) of Section 21, a member of a Local Board nominated under clause (c) of sub-section (1) of Section 21 shall hold office for such term, not exceeding three years, as the Central Government may specify in this behalf and thereafter until his successor has been duly nominated and shall be eligible for renomination:
Provided that no such director shall hold office continuously for a period exceeding six years.";
(b) after sub-section (4), the following sub-section shall be inserted, namely:-
"(5) A member of a Local Board nominated under clause (c) of sub-section (1) of Section 21 shall hold office during the pleasure of the Central Government".].
1 Subs. by Act 3 of 1994, S. 22 (w.e.f. 15-10-1993).
14. Amendment of Section 39.-In Section 39 of the State Bank Act,-
(a) for the words "in each year", the words "or such other date in each year as the Central Government may, by notification in the Official Gazette, specify" shall be substituted;
(b) the following proviso shall be inserted at the end, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the closing and balancing of, or for other matters relating to, the books in respect of the concerned years.".
15. Amendment of Section 40.-In Section 40 of the State Bank Act, in sub-section (1), after the words, figures and letters "the 31st day of December", the words and figures "or the date specified under Section 39, as the case may be," shall be inserted.
16. Amendment of Section 42.-In Section 42 of the State Bank Act, in sub-section (2), after the words, figures and letters "the previous 31st day of December", the words and figures "or the date specified under Section 39, as the case may be" shall be inserted.
17. Amendment of Section 50.-In Section 50 of the State Bank Act, in sub-section (1), after the words "the Central Government", the words, "by notification in the Official Gazette," shall be inserted.
CHAPTER 6 - AMENDMENTS TO THE STATE BANK OF INDIA (SUBSIDIARY BANKS) ACT, 1959
18. Amendment of Section 25.-In Section 25 of the State Bank of India (Subsidiary Bank) Act, 1959 (38 of 1959), (hereafter in this Chapter referred to as the Subsidiary Banks Act), in sub-section (1),-
(a) in clause (c), the following proviso shall be inserted at the end, namely:-
"Provided that any nomination of a director made by the State Bank under this clause shall, except in so far as it relates to an officer of that bank, be in consultation with the Central Government;";
(b) in clause (e), the words "in consultation with the State Bank" shall be omitted.
19. Amendment of Section 26.-In Section 26 of the Subsidiary Banks Act,-
(a) in sub-section (1),-
(i) for the portion beginning with the words "if nominated" and ending with the words "that sub-section,", the following shall be substituted, namely:-
"nominated under clause (b) or clause (c) or clause (e) of sub-section (1) of Section 25 or appointed under clause (ca) or clause (cb) of that sub-section";
(ii) for the word "nominating", the words "nominating or appointing" shall be substituted;
(b) for sub-sections (2) and (2-A), the following sub-sections shall be substituted, namely:-
"(2) Subject to the provisions contained in Section 25, a director elected under clause (d) of sub-section (1) of that section shall hold office for three years and thereafter until his successor is duly elected, and shall be eligible for re-election:
Provided that no such director shall hold office continuously for a period exceeding six years.
(2-A) Subject to the provisions contained in Section 25 and in sub-section (1), a director nominated under clause (c) and not being an officer of the State Bank or a director appointed under clause (ca) or clause (cb) or a director, not being an officer of the Central Government, nominated under clause (e) of sub-section (1) of Section 25, shall hold office for such term not exceeding three years, as the Central Government may specify and thereafter until his successor shall have been duly nominated or appointed, and shall be eligible for re-nomination or reappointment, as the case may be:
Provided that no such director shall hold office continuously for a period exceeding six years.";
(c) sub-section (3) shall be omitted.
20. Amendment of Section 39.-In Section 39 of the Subsidiary Banks Act,-
(a) for the words "in each year", the words "or such other date in each year as the Central Government may, by notification in the Official Gazette, specify" shall be substituted;
(b) the following proviso shall be inserted at the end, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the closing and balancing of, or for other matters relating to, the books in respect of the concerned years.".
21. Amendment of Section 43.-In Section 43 of the Subsidiary Banks Act, in sub-section (1), in clause (a), after the words, figures and letters "the 31st day of December", the words and figures "or the date notified under Section 39, as the case may be," shall be inserted.
22. Amendment of Section 44.-In Section 44 of the Subsidiary Banks Act, in sub-sections (2) and (3), after the words, figures and letters "the previous 31st day of December", the words and figures "or the date notified under Section 39, as the case may be" shall be inserted.
23. Amendment of Section 63.-In Section 63 of the Subsidiary Banks Act, in sub-section (1), after the words "the Reserve Bank,", the words "by notification in the Official Gazette," shall be inserted.
CHAPTER 7 - AMENDMENTS TO THE DEPOSIT INSURANCE AND CREDIT GUARANTEE CORPORATION ACT, 1961
24. Amendment of Section 6.-In Section 6 of the Deposit Insurance and Credit Guarantee Corporation Act, 1961 (47 of 1961), (hereafter in this Chapter referred to as the Deposit Insurance Corporation Act), in sub-section (2),-
(a) in clause (i), after the word, brackets and letter "clause (c)", the words, brackets and letters "or clause (d) or clause (e)" shall be inserted;
(b) for clause (ii), the following clause shall be substituted, namely:-
"(ii) Subject to the provisions contained in clause (i), a director nominated under clause (d) or clause (e) of sub-section (1), shall hold office for such period, not exceeding three years, as may be specified by the Central Government in this behalf and thereafter until his successor assumes office, and shall be eligible for re-nomination:
Provided that no such director shall hold office continuously for a period exceeding six years.".
25. Amendment of Section 28.-In Section 28 of the Deposit Insurance Corporation Act, in sub-section (2),-
(a) for the words, "each year", the words "or such other date in each year as the Central Government may, by notification in the Official Gazette, specify" shall be substituted;
(b) the following proviso shall be inserted at the end, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this sub-section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the balancing and closing of, or for other matters relating to, the books or accounts in respect of the concerned years.".
26. Amendment of Section 50.-In Section 50 of the Deposit Insurance Corporation Act, in sub-section (1), after the words "the Reserve Bank,", the words "by notification in the Official Gazette," shall be inserted.
CHAPTER 8 - AMENDMENTS TO THE INDUSTRIAL DEVELOPMENT BANK OF INDIA ACT, 1964
27. Amendment of Section 6.-In Section 6 of the Industrial Development Bank of India Act, 1964 (18 of 1964), (hereafter in this Chapter referred to as the Development Bank Act), for sub-section (4-A), the following sub-section shall be substituted, namely:-
"(4-A) Subject to the provisions of sub-section (4),-
(a) every director nominated under sub-clause (ii) or sub-clause (iv) of clause (c) of sub-section (1) and not being an official of Government or not being an official or whole-time director of the Reserve Bank or a financial institution or the State Bank or a nationalised Bank or a State Financial Corporation; and
(b) every director nominated under sub-clause (iii) or sub-clause (v) of clause (c) of sub-section (1),
shall hold office for such term, not exceeding three years, as the Central Government may specify in this behalf and thereafter until his successor assumes office, and shall be eligible for re-nomination:
Provided that no such director shall hold office continuously for a period exceeding six years.".
28. Amendment of Section 18.-In Section 18 of the Development Bank Act, in sub-section (2), the following proviso shall be inserted at the end, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this sub-section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the closing and balancing of, or for other matters relating to, the books or accounts in respect of the concerned years.".
29. Amendment of Section 21.-In Section 21 of the Development Bank Act, in sub-section (2), the following proviso shall be inserted at the end, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this sub-section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the closing and balancing of, or for other matters relating to, the books or accounts in respect of the concerned years.".
CHAPTER 9 - AMENDMENTS TO THE BANKING COMPANIES (ACQUISITION AND TRANSFER OF UNDERTAKINGS) ACT, 1970
30. Amendment of Section 3.-In Section 3 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of 1970), (hereafter in this Chapter referred to as the Bank Nationalisation Act), in sub-section (2-A), in the proviso, for the words "rupees one hundred crores", the words "rupees five hundred crores" shall be substituted.
31. Amendment of Section 9.-In Section 9 of the Bank Nationalisation Act,-
(a) in sub-section (2),-
(i) in clause (a), for the words "rupees one hundred crores", the words "rupees five hundred crores" shall be substituted;
(ii) in clause (c), for the words "corresponding new bank to any other banking institution", the words "corresponding new bank to any other corresponding new bank or banking institution" shall be substituted;
(b) in sub-section (5), the Explanation shall be numbered as Explanation I, and after Explanation I as so numbered, the following Explanation shall be inserted, namely:-
"Explanation II.-For the purposes of this section, the expression "corresponding new bank" shall include a corresponding new bank within the meaning of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980).".
32. Amendment of Section 10.-In Section 10 of the Bank Nationalisation Act, in sub-section (1),-
(a) for the words "of each year", the words "or such other date in each year as the Central Government may, by notification in the Official Gazette, specify" shall be substituted;
(b) the following proviso shall be inserted, at the end, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this sub-section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the closing and balancing of, or for other matters relating to, the books in respect of the concerned years.".
CHAPTER 10 - AMENDMENTS TO THE REGIONAL RURAL BANKS ACT, 1976
33. Amendment of Section 19.-In Section 19 of the Regional Rural Banks Act, 1976 (21 of 1976), (hereafter in this Chapter referred to as the Rural Banks Act), in sub-section (1),-
(i) for the words "of each year", the words "or such other date in each year as the Central Government may, by notification in the Official Gazette, specify" shall be substituted;
(ii) the following proviso shall be inserted at the end, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this sub-section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the closing and balancing of, or for other matters relating to, the books in respect of the concerned years.".
34. Amendment of Section 30.-In Section 30 of the Rural Banks Act, in sub-section (1), after the words "the Central Government,", the words "by notification in the Official Gazette," shall be inserted.
CHAPTER 11- AMENDMENTS TO THE BANKING COMPANIES (ACQUISITION AND TRANSFER OF UNDERTAKINGS) ACT, 1980
35. Amendment of Section 3.-In Section 3 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980), (hereafter in this Chapter referred to as the Bank Nationalisation Act), in sub-section (2-A), in the proviso, for the words "rupees one hundred crores", the words "rupees five hundred crores" shall be substituted.
36. Amendment of Section 9.-In Section 9 of the Bank Nationalisation Act,-
(a) in sub-section (2),-
(i) in clause (a), for the words "rupees one hundred crores", the words "rupees five hundred crores" shall be substituted;
(ii) in clause (c), for the words "corresponding new bank to any other banking institution", the words "corresponding new bank to any other corresponding new bank or banking institution" shall be substituted;
(b) in sub-section (5), the Explanation shall be numbered as Explanation I, and after Explanation I as so numbered, the following Explanation shall be inserted, namely:-
"Explanation II.-For the purpose of this section, the expression ‘corresponding new bank’ shall include a corresponding new bank within the meaning of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of 1970).".
37. Amendment of Section 10.-In Section 10 of the Bank Nationalisation Act, in sub-section (1),-
(a) for the words "of each year", the words "or such other date in each year as the Central Government may, by notification in the Official Gazette, specify" shall be substituted;
(b) the following proviso shall be inserted at the end, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this sub-section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the closing and balancing of, or for other matters relating to, the books in respect of the concerned years.".
38. Amendment of Section 19.-In Section 19 of the Bank Nationalisation Act, in sub-section (1), after the words "the Central Government,", the words "by notification in the Official Gazette," shall be inserted.
CHAPTER 12- AMENDMENTS TO THE EXPORT-IMPORT BANK OF INDIA ACT, 1981
39. Amendment of Section 6.-In Section 6 of the Export-Import Bank of India Act, 1981 (28 of 1981), (hereafter in this Chapter referred to as the Exim Bank Act,-
(a) for sub-section (6), the following sub-section shall be substituted, namely:-
"(6) Subject to the provisions contained in sub-section (7), any director nominated under clause (b) or clause (c) or clause (d) or clause (e) of sub-section (1) and not being an official of Government or not being a whole-time director or official of the Reserve Bank or the Development Bank or the said Export Credit and Guarantee Corporation Limited or a scheduled bank, shall hold office for such term, not exceeding three years, as the Central Government or, as the case may be, the authority nominating him, may specify in this behalf and thereafter until his successor enters upon his office, and shall be eligible for re-nomination:
Provided that no such director shall hold office continuously for a period exceeding six years.";
(b) in sub-section (7), the word "other" shall be omitted.
40. Amendment of Section 19.-In Section 19 of the Exim Bank Act, in sub-section (2),-
(a) for the words "each year", the words "or such other date in each year as the Central Government may, by notification in the Official Gazette, specify" shall be substituted;
(b) the following proviso shall be inserted at the end, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this sub-section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the closing and balancing of, or for other matters relating to, the books or accounts in respect of the concerned years.".
41. Amendment of Section 22.-In Section 22 of the Exim Bank Act, in sub-section (1),-
(a) for the words "each year", the words "or such other date in each year as the Central Government may, by notification in the Official Gazette, specify" shall be substituted;
(b) the following proviso shall be inserted at the end, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this sub-section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the closing and balancing of, or for other matters relating to, the books or accounts in respect of the concerned years.".
42. Amendment of Section 39.-In Section 39 of the Exim Bank Act, in sub-section (1), after the words "the Central Government,", the words "by notification in the Official Gazette," shall be inserted.
CHAPTER 13 - AMENDMENTS TO THE NATIONAL BANK FOR AGRICULTURE AND RURAL DEVELOPMENT ACT, 1981
43. Amendment of Section 5.-In Section 5 of the National Bank for Agriculture and Rural Development Act, 1981 (61 of 1981), (hereafter in this Chapter referred to as the National Bank Act), in sub-section (3), the following proviso shall be inserted at the end, namely:-
"Provided that during the period of any casual vacancy of the nature referred to in Section 11 in the office of the Managing Director, the Chairman may also exercise the powers and discharge the functions of the Managing Director until the person appointed by the Central Government under Section 11 to act as Managing Director enters upon his office.".
44. Amendment of Section 6.-In Section 6 of the National Bank Act, in sub-section (2), the following proviso shall be inserted at the end, namely:-
"Provided that no such consultation shall be necessary in the case of directors appointed under clause (e) of sub-section (1).".
45. Amendment of Section 7.-In Section 7 of the National Bank Act,-
(a) for sub-section (2), the following sub-section shall be substituted, namely:-
"(2) Subject to the provisions contained in sub-section (5), a director appointed under clause (b) or clause (c) of sub-section (1) of Section 6, shall hold office for such term, not exceeding three years, as the Central Government may specify in this behalf and thereafter until his successor enters upon his office, and shall be eligible for reappointment:
Provided that no such director shall hold office continuously for a period exceeding six years.";
(b) in sub-section (3), the words, brackets and figure "or any other director referred to in sub-section (2)" shall be omitted;
(c) after sub-section (4), the following sub-section shall be inserted, namely:-
"(5) The directors appointed under clauses (b) to (f) of sub-section (1) of Section 6 shall hold office during the pleasure of the Central Government.".
46. Amendment of Section 46.-In Section 46 of the National Bank Act, in sub-section (2),-
(a) for the words, "each year", the words "or such other date in each year as the Central Government may, by notification in the Official Gazette, specify" shall be substituted;
(b) the following proviso shall be inserted at the end, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this sub-section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the balancing and closing of, or for other matters relating to, the books or accounts in respect of the concerned years.".
CHAPTER 14 - AMENDMENTS TO THE INDUSTRIAL RECONSTRUCTION BANK OF INDIA ACT, 1984
47. Amendment of Section 10.-In Section 10 of the Industrial Reconstruction Bank of India Act, 1984 (62 of 1984), (hereafter in this Chapter referred to as the Industrial Reconstruction Bank Act), after sub-section (2), the following sub-section shall be inserted, namely:-
"(3) Subject to the provisions of sub-section (2), a director nominated under clause (c) or clause (d) of sub-section (1) and not being an official of Government or not being an official or whole-time director of the Development Bank or a public financial institution or the State Bank or a nationalised bank or a State Financial Corporation, shall hold office for such term, not exceeding three years, as the authority nominating him may specify in this behalf and thereafter until his successor enters upon his office, and shall be eligible for re-nomination:
Provided that no such director shall hold office continuously for a period exceeding six years.".
48. Amendment of Section 29.-In Section 29 of the Industrial Reconstruction Bank Act, in sub-section (2),-
(a) for the words "each year", the words "or such other date in each year as the Central Government may, by notification in the Official Gazette, specify" shall be substituted;
(b) the following proviso shall be inserted at the end, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this sub-section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the closing and balancing of, or for other matters relating to, the books or accounts in respect of the concerned years.".
49. Amendment of Section 32.-In Section 32 of the Industrial Reconstruction Bank Act, in sub-section (2),-
(a) for the words "each year", the words "or such other date in each year as the Central Government may, by notification in the Official Gazette, specify" shall be substituted;
(b) the following proviso shall be inserted at the end, namely:-
"Provided that with a view to facilitating the transition from one period of accounting to another period of accounting under this sub-section, the Central Government may, by order published in the Official Gazette, make such provisions as it considers necessary or expedient for the closing and balancing of, or for other matters relating to, the books or accounts in respect of the concerned years.".
50. Amendment of Section 69.-In Section 69 of the Industrial Reconstruction Bank Act, in sub-section (1), after the words "the Central Government,", the words "by notification in the Official Gazette," shall be inserted.