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REGISTERED No. D- 28

The Gazette of India

EXTRAORDINARY

PUBLISHED BY AUTHORITY

NEW DELHI, SATURDAY, JULY 30, 1949

INDUSTRIAL FINANCE CORPORATION OF INDIA

[Incorporated under the Industrial Finance Corporation Act, 1948 (XV of

1948)].

In exercise of the powers conferred by section 48 of the Industrial Finance Corporation Act, 1948, (XV of 1948), the Board of Directors of the Industrial Finance Corporation of India, after consultation with the Reserve Bank of India, and with the previous sanction of the Central Government is pleased to make the following regulations, namely:-—

1. Short title and application.—(1) These regulations may be called the Industrial Finance Corporation (Issue of Bonds) Regulations, 1949.

(2) They shall apply to bonds issued and sold by the Corporation under sub- sectiou (1) of Section 2 of the Industrial Finance Corporation Act, 1948.

2. Definitions.—In these regulations unless there is anything repugnant in the subject or context,—

(a) "The Act" means the Industrial Finance Corporation Act, 1948;

(b) "The Bank" means the Reserve Bank of India;

(c) "Bond" means the bonds issued and sold by the Corporation under sub-section (1) of Section 21 of the Act;

(d) "Defaced Bond" means a bond which has been made illegible and rendered undecipherable in material parts and the material parts of a bond are those where:— •—

(i) the number, the issue to which it appertains and the face value of the bond or payments of interest are recorded, or

(ii) The endorsement or the name of the payee is written, or

(iii) the renewal receipt is supplied.

(e) " F o r m" means a form as set out in the schedule to these regulations;

(f) "Lost Bond" means a bond which has actually been lost and shall not mean a bond which is in possession of some person adversely to the claimant;

(g) "Mutilated Bond" means a bond which has been destroyed, torn or damaged in material parts thereof;

(h) "Office of Issue" means the, Office of the Reserve Bank of India on the books of which a bond is registered or may bo registered;

( 1831 )

(i) "Prescribed Officer" moans such officers of the Corporation or of the Bunk as may LIB authorised by the Board of Directors of tlie Corporation lor the purposes of Regulations 9, 10, 11, IB, 14 and 15.

a. Form of the bond and the mode of transfer thereof, etc.—(1) A bond may be issued in the form of promissory note payable to, or to the order of, a certain person;

(2) A. bond shall bo transferable by endorsement and delivery like a promissory' note payable to order;

(") No endorsement of a bond shall be valid unless made by the signature, oi the holder or his duly constituted attorney or representative inscribed on the back of the bond itself;

(4) No writing on a bond is valid for the purpose of negotiation if sjch writing purports to transfer' only part of the amount denominated by the bond;

(5) (i) The bond shall be issued over the signature of the Managing Director ot the Corporation which may be printed, engraved or lithographed or impressed by nuoh other mechanical process as the Corporation may direct;

(ii) A signature so printed, engraved, lithographed or otherwise impressed shall be as valid as il it had buen inscribed in the proper hand-writing Li the signatory himself.

4. Trust not recognised.—The office, of issue shall, not Lie bound or compelled to recognise in any way, even when having notice thereof, any ivnui or any right in respect of a bond other than an absolute right thereto in the holder.

5. Persons disqualified to be holders.—No minor and no person who has been found by a competent court to be of unsound mind shall be entitled to be a holder.

(•). Payment of interest.--(1) Interest on a bond shall be paid by the c.moe of issue or any other office of the B'imk us may be prescribed in the relative bond prospectus subbed, to compliance by the holder with sueh formalities as the office of issue .may require., on presentation of the bond, by Interest Warrant in favour- ol the holder payable at the local office of the Bunk.

(2) Notwithstanding anything contained in sub-regulation (1) the office of issue may pay interest on a bond, the interest on which, is payable at any other office of the Bank by an interest warrant payable at such office.

7. Procedure when bond is lost, etc—(l) Every application for the issue of a duplicate bond in place o£ a bond which is alleged to have been lost, stolen, destroyed, mutilated or defaced, cither wholly or in part shall be addressed to the office of issue, and shall, contain the following particulars, namely: —

(a) Particulars of the Bond according to the following form:—

.Bond for. iis.

No. ot the por cent. Bond

(b) Last half-year for which interest bus been paid;

(<•) tlit person to whom such interest was paid;

(d) the jjerson in wliose name bond was issued (if known);

((•') the place of payment of interest at which the bond was enfaeed;

(f) the circumstances attending the loss, theft, destruction, mutilation or defacement; and

(g) whether the loss or theft was reported to the police.

(2) Such application shall be accompanied b y : --

(n) whore the bond was lost in coui-ae of transmission by registered post, the Poet Office registration receipt for the letter containing the bord;

(b) a copy of the police report, if the loss or theft was reported to the police;

(c) whore the. last payment of interest was not made by the office of issue, a letter signed by the Manager of the Hank where interest was last paid, certifying the last payment of interest on the bond and stating the name of the party to whom snch payment watt made;

(d) if the applicant is not the registered holder, an affidavit eworn before a magistrate testifying that the applicant was the last legal holder of the bond, and nl! documentary evidence necessary to trace back the title to the registered holder; and

(e) any portion or fragments whiojh may remain of the lost, stolen, des- troyed, mutilated or defaced bond,

(8) A copy of the application addressed to the office of issue shall also be, sent 1o the office of the Banl< where interest is payable, provided that it shall not be necessary to send copies of the enclosures accompanying the application.

8. Notification In Gazette.—The loss, theft, destruction, mutilation or deface- ment of a bond or portion of

"Tjost" ("stolen", "'destroyed", "mutilated" or "defaced" as the case

may be).

The f.F.C. bond No, of the per cent.

Bond for Us. originally standing in the naino of and last endorsed to th

9. lasue ol duplicate bond and taking of indemnity.—(2) After the publication of Ihc liisl- r.otifV'ition "prescribed in regulation ft, the prescribed officer shall, if he is satisfied of tlv loss, theft, destruction, mutilation or defacement of Ihc bond and of the justice of the tilaim of the applicant, cause the particulars of the bond to be included in a list published under regulation 10, nnd shall order th" office of issue: —

(n) if only a portion of the bond has been lost, stolon, destroyed, muti- lated or defaced, and if a portion thereof sufficient for its identi- fi ration has been produced, to pay interest and to issue to the applicant, on execution of nn indemnity bond such as is herein- after mentioned a duplicate bond in place of that of which a portion has been so lost, stolen, destroyed, mutilated or defaced,

either immediately niter the. publication of the list under regula- tion 10 or on the expiry of such period as the prescribed officer may consider necessary from the date of the publication of the said list;

(b) if iio portion of the bond MO lost, stolen, destroyed, mutilated or defaced, sufficient for ite identification has been produced—

(T) to pay to the applicnnt, two years wfter the publication of the said list, &nd on the execution erf an indemnity bond in the manner hereinafter prescribed, the interest in respect of the bond so lost, stolen, destroyed, mutilated or defaced till the expiry of the period of six years as next hereinafter provided; and

(II) to issue to the applioant a duplicate bond In place of the bond so lost, stolen, destroyed, mutilated or defaced six years after the date of publication of the said list; provided that—

(i) if the date on which the bond is due for repayment falls earlier than the date on which the said period of six years expires, the prescribed officer shall, within six weeks of the former date, invest the principal amount due on the bond in the Post Office Savings Bank, and shall repay this amount, together with any interest which may have accrued thereon in such Bank, to the applioant at the time when a duplicate bood would otherwise have been issued, and

(ii) if at any time- before the issue of the duplicate bond (be original bond iy discovered or it appears to the office of issue for other reasonR that tho order should be rescinded, the matter shall be referred to the prescribed officer for further consideration and in the meantime all action on the order shall be suspend- ed. An order passed under this sub-regulation shall on expiry of the period of six years referred to therein, become final unless it is in the meantime rescinded or otherwise modified.

(2) The prescribed officer may, at any time prior to the issue of n duplicate bond, if he finds sufficient reason, alter or cancel any order made by him under this regulation and may also direct that the interval before trie issue of a duplicate bond shall be extended by Riich period not exceeding six yenrs as h/¹ may think fit.

(3) Indemnity Bonds—

(i) (a) when executed under sub-regulation (l)(a) shall be for twice the amount: of interest involved, that is to say, twice the. amount of all back interest accrued due on the bond phiR twice the amount of all interest to accrue due thereon during the period which will have, to elopse before the issue of a duplicate bond o"n be mado, and

(b) in fill othev cases shall be for twice the face value of the hond plus twice the amount of interest calculated in accordance with clause (a).

(ii) Tho prescribed officer may direct that such indemnity bond shall be executed by the applicant alone off by the applicant and one or two surf ties approved by him "s he may thirk fit.

10. Publication of Hat.—(1) The list referred to in regulation 9 shall be published half-yearly in the Gazette of India in the months of January and July or as soon afterwards ns may be convenient,

(2) All bonds in respect of which an order has been passed under regulation 9 shall be included in, the first lipt published next after the passing of such order and thereafter such bonds shall continue to be included in every succeed- ing list until the expiration of six years from the date of first publication.

(8) The list shall¹ contain the following; particulars? regarding each bond in- cluded therein, namely, the name of the issue, the number of the bond, its vulue, the name of the person to whom it was issued, the date from which it bears interest, the name of the applicant for a duplicate, the, number and date of the order passed by the prescribed officer for payment of interest or issue of a duplicate, nrd the date of publication of the list in which the bond was first included,

11. Determination of a mutilated bond as a bond requiring renewal It shall be at the option of th,e prescribed officer to treat a bond which has been mutilated or defaced us a bond requiring issue of a duplicate under regulation 9 or irere renewal under regulation 14.

12. When a bond la required to be renewed.—(1) A holder of a bond may be required by the office of issue to receipt the same for renewal in any of the following cases, namely:

v(n.) if only sufficient room remains on the back of the bond for one further endorsement or if any word is written upon the bond across the existing endorsement or endorsements;

(h) if the bond is torn or in any way damaged or crowded with writing or unfit, in the opinion of the office of issue;

(c) if any endorsement is not clear and distinct or does not indicate the payee or payees, as the case may be, by name or ia made otherwise than in one oE the endorsement cages on the back of the bond;

(d) if the interest on the bond has remained undrawn for ten years or more;

(e) if the- interest cages on the reverse of the bond have been complete- ly filled or if the vacant proscribed cages on the reverse of the bond do not correspond with the half years for which interest has become, duo on the dnte when the bond is presented for drnwal of interest;

(f) if the bond having been enfneed three times for payment of interest Is presented for re-enfaeement; nnd

'f$ if in tho mmiinn of the office of issue, the titlo of the person presenting the bond for payment of interest is irregular or not fully proved,

(2) When requisition for renewal of a bond has been made under sub- regulation (1) payment of any further interest thereon shall be refused- until it is receipted for renewal nnd actually renewed.

13. Person whose title to a bond of a deceased Bole holder may be recognis- ed.—(1) The executors or administrators of a decoased sole holder of n bond (whether a Hindu. Mohammedan, Parsi or otherwise) nnd the holder of a succession certificate issued under Part X of the Indian Succession Act, 1925 (XXXTX of 19251 in respect of the bond shall be the only persons who may be recognised by the office of issue (suhi'ect to arty general or special instruc- tions of the prescribed officer) ns having unv title to the bond.

(2) Notwithstanding nnvthinp contained in Section '45 of the Indian Oon- trm.-t Act. 1872 (IX of 1R72), in the case of a bond 1=sued, seld or held pay- able to two or more holders, the survivors or survivor nnd on the death of the

last .survivor, bis executors, administrators, or any person wbo is the holder of a succession certificate in respect of such bond shall, be the only person who may be recognised by the office of issue, (subject to any general or special instruc- tions of the prescribed officer) us having any title to" the bond.

(3) The office of issue shall not be bonmd to recognise such executors or administrators unless thev shnll have obtained probate or letters of tidmmis- tratioti or other legal representation, us the case may be from a competent court or office in India, having effect at tho place of situation of the office of issue.

Provided nevertheless that in any case where the prescribed officer shall in his absolute discretion think fii, it shnll be lawful for him to dispense with the production of: probate, letters of administration or other legal representa- tion upon such terms :i" i.o indemnity or otherwise as he may think fit,

14. Eeceipt for renewal etc—(1) Subject to any general or special instruc- tions of the prescribed officer, the office of issue, by its order, on the appli- cation of the holder, on bis delivering the bond or bonds and on his satisfying the office of issue regarding the justice of his claim, renew, sub-divide or con- solidate a bond or bonds provided the bond or bonds haB or have been receipt- ed in Form F, TT or ] !'I as the case may be and the prescribed feo, if any, has been paid.

(2) The office of issue may, under the orders of the prescribed officer, require the applicant for renewal, sub-division or consolidation of 'a bond under the sub-regulation (1) to execute a bond in Form f.V with one or more sureties approved by him.

15. Renewal of bond In case of dispute as to title,—Where there h a dis- pute n.H to the title to n bond in respect of which an application for renewal has been made, the prescribed officer may:—

(a) where any party to the dispute has obtained A final decision from a court of competent jurisdiction declaring him to be entitled to such bond, issue a renewed bond in favour of such party, or

(b) refuse to renew the bond until such a decision has been obtained. Explanation:—"For Qie purposes of this sub-regulation, the expression 'final decision' means H decision which is not appealable or a decision which is appealable, but against which no appeal has been filed within the period of limitation allowed by law.

16. Liability In respect of bond renewed etc.—When a duplicate bond has been issued under regulation 9 or u renewed bond has been issued or a- new bond has been issued upon sub-division or consolidation under regulation 14. in favour of M person, the bond so issued shall be deemed fo constitute a new cot if met between the Corporation and such person and all persons deriving title thereafter through him,

17. Discharge.—The Corporation shall be discharged from all liability in res- pect of the bord or bonds paid on maiurity or in place of which a duplicate, renewed, sub-divided or consolidated bond or bonds has or have been issued:—. fai in thp case of payment, after the lapse of six years from the date on which payment was due:

(b) in the case of a duplicate bond after the lapse of six years from th" date of the publication under regulation 1.0 of the list in which the bond 1K first mentioned, or from the date of the pay- ment of interest on tho original bond, whichever date is later;

((•.} in the ease of a renewed bond or of a new bond issued upon Rub-division or consolidation—after the lapse of six years from, the date of issue thereof,

18. Discharge in respect of interest.—rS:iv0 an otherwise expressly provided in the terms of the bond, no person bliu.ll bo outiilcd to claim interest on any such bond in respect or any period which has elapsed after the earliest date on which demand oould have been made for the payment of the amount due on Buch bond.

19. Discharge of a bond.—When a bond becomes due for payment of principal, the bond bhall be presented at the office of the Bank at which the interest thereon is payable or at the office of issue duly signed by the holder en its reverse.

T H E S C H E D U LE

[Boo .Regulation ^(o)]

FORM 1.

[Bee Regulation 14(1)j

Form ol endorsement for renewal of a Bond.

Received in lion hereof u- renewed bond payable to (name of holder), with interest payable at Reserve Bank of India, ,

Signature of the holder/duly authorised representative of (name of holder¹)

FORM II

[Bee Regulation 14(1)]

Form of endorsement for Sub-division ol a bond.

Received in lieu thereof bonds for Ra.

respectively,- payable to (name oi holder) with interest payable at Reserve Bank of India,

Signature of the holder/duly authorised^representative of (name of holdor)

FORM III

[See Regulation 14(1)]

Form of endorsement for consolidation of bonds.

Received in lieu hereof a view bond payable to (name of holder) lor RH. by consolidation with bond or bonds Nos.

(mentioning the numbers and amounts of the other bonds desired to be consolidated with it and specifying tbo issue) with interest pay- able ai, Reserve Hank of India,

Signature of the holder/duly authorised representative of (name °£ holder)

FOEM IV.

[Bee Regulation 14(2)]

KNOW ALL MEN BY THESE PEEBENTS that we-

ts) Prlnolpal.

(b) Sureties.

sou dl resident of— (and 1— apn of—• resident of—r- and son i>f —— resident of hereby bind ourselves and each of us, our and each of our heirs, executors, administrators and representatives and all of them jointly and severally to the Industrial finance Corporation of India as constituted by the Industrial Finance Corporation Act, 1948 (herein- aftor oalled tip said Corporation) for payment of the sum. of Its.

1 'to the said Corporat'on, its certain attorneys, successors and assigns.

AND lyeaoh of us the sajd—.————i— -hereby covenant with the said Corporation that if any suit shall be brought touching the subject matter of this obligation or the condition heje- under wjhtten in any court subordinate to ihe High Court f& Judicature at Simla, the same may, at the instance of the said Corporation oir the Eeserve Bank of India, Delhi, whoever may be a party to suoh suit, be removed unto, tried and determined by, the said High Court in its extraordinary original civil jurisdiction, as the case may be.

WHEEEAS the said . . . (a) has applied to the Eeserve Bank of India, Delhi* for the renewal/consolidation /sub-division of the bond (bonds) issued by the said Corporation mentioned in the schedule hereto.

*Out of the several al- ternative* mentioned hereafter, retain the one whioh applies to the rose and strike out the others.

AND WHEEEAS the said Eeserve Bank of India have consented (a) Priaoipal.

and agreed to accept the said application on the said (a)—.

, , 1— -with two good- and suffi- cient sureties entering into and executing the above written bond subjeot to ihe condition hereunder written:

AND WHEEEAS the above bounden . .

*If there ore two Bureties, (and) .—. *ab the request of the said—

(a) Principal.

(a) has (have) agreed to become surety (sureties) for (a) and to join with fche said (a) hi executing tne above written bond.

Now the condition of the above written bond ia suoh that if the above bounden—> .——-™ •—~,

(h) [Name.) of tho Priii- i if)nl ftud Hiirotiea of (a).I (b) oi' each of them or their heirs, executors, administrators ov repre- ttifcives or iiuy or either oi' them shall from lime Lo t;me and at all times hereafter effectually save, defend, keep harmless uncl indemni- ficcl tin- said Corporation and tin-; said ltestTve J.iank !jf India from tiiid against the claims uud demands of ail persons jhiimin^ to hn entitled to th*j bond (boudsj issued by the said Corporation mentioned, in the schedules hereto or to any interest thert-on ,uid ol; all other, persons whomsoever in respect of the said bond (Bonds) or the l'euowuL tliei'eoJ' or iht) pu)tnent of any interest Ihereon and fron'. and ugiiiuHfc nil clumagos, losses, costs, charges ami expenses which the said Corporation o.r the. said Keserve J.lan.k" of. Ihdia may siislu'ni, incur or be liable to for or in consequence of any wuch okurn. or deuumd or by reason of the issue of renewed bond (bonds) as fifoi-e- Kfiid en- the jiayjaent of any interest due on ilu- said bond (bonds) or renewed bond (bond*) then the tibove. written bond shall be void but otherwise the sawio shall renuiin iu full force and eflVel.

SifiTied and delivered by

in the prespneo o'i-

aiid ofi-

Uate:

Tho Schedule herein referred to

Kntiiri; ftnd *l"so"iption.of the Nnnnhei' Dale of Am on fit

Published in. terms of Section 4y(f'5) of tke Industrial .Finance Corporation Act, 1948 (XV of 1948).

NeiY Delhi. 26th July 1949.

11 KM NATH,

MANAGING DIRECTOR.

INDUSTRIAL FINANCE CORPORATION OF INDIA

•NOTIFICATION

New Delhi, the 26th July 1949.

No. 7/49.—Ic. pursuance of Section 43(1) of the Industrial finance Corpora- lion Act, 1948 (XV of ]i)48), the Hoard of Directors of the industrhl Finance Corporation of India, alter consultation with the Reserve Bank of India and with the previous sanction of the Central Government, has made the following amendment [to Regulation 45 of the General Regulations of ihe Corporation. [Regulation 45 shall be al.tercd to read as follows:—

Regulation 45.—Accounts, receipts and documents of the Corporation by Whom to be signed:—The Managing Director, or such other officers of the Corporation, as the XJoiTrd may by notification in the. official Gazette authorise in thin behalf, may igaue, execute, endorse and transfer promissory notes, bonds, stock rccoipts, stock, debentures, shares, securities and documents of title to goods standing in the name of or held by the Corporation, and to draw, accept and endorse bills of exchange and oilier instruments in the curient and authorised business of the Corporation and to fiign all ether accounts, receipts and documents connected with Biioh business,,

RAM NATH,

MANAGING DIRECTOR.

PunLraHkTJ BY -j'aE MANAGKH OP 1'UBMOATTONS, D E L H I, I N D IA PlttNTTO BV TTTK MANAOKR, OOVBHNMHNT OF TN.OIA PltES<(, SW D"TJIT, J,NDI\.