REGISTERED NO. D. 221
The Gazette of India
EXTRAORDINARY
PART II—Section 1
PUBLISHED BY AUTHORITY
No. 47] NEW DELHI, MONDAY, DECEMBER 30, 1963/PAUSA 9, 1885
MINISTRY OF LAW
(Legislative Department)
New Delhi, the 30th December, 1963/Pausa 9, 1885 (Saka)
The following Acts of Parliament received the assent of the Pre sident on the 30th December, 1963,, and are hereby published fo: general information: —
THE PREVENTIVE DETENTION (CONTINUANCE)
ACT, 1963
No. 51 OP 1963
[30th December, 1963]
An Act to continue the Preventive Detention Act, 1950, for a further period.
BE it enacted by Parliament in the Fourteenth Year of the
Republic of India as follows: —
Short title.
1. This Act may be called the Preventive Detention (Continuance'
Act, 1963.
Amendment of section 1, 4 or 1950.
2. In sub-section (3) of section 1 of the Preventive Detention Act
1950, for the figures, letters and words "31st day of December, 1963"
the figures, letters and words "31st day of December, 1966" shall be
substituted.
(533)
843 G of I Ext.—1.
534 rWtE GAZETTE OF INDIA EXTRAORDINARY [PART 11THE UNIT TRUST OF INDIA ACT, 1963
No. 52 OF 1963
[30th December, 1963]
An Act to provide for the establishment of a Corporation witl a view to encouraging saving and investment and participa- tion in the income, profits and gains accruing to the Corpo- ration from the acquisition, holding, management and dis- posal of securities.
BE it enacted by Parliament in the Fourteenth Year of the Republic of India as follows: —
CHAPTER I
PRELIMINARY
1. (1) This Act may be called the Unit Trust of India Act, 1963.
(2) It extends to the whole of India.
Short title, extent and com- mence- ment.
(3) It shall come into force on such date as the Central Govern- ment may, by notification in the Official Gazette, appoint.
2. In this Act, unless the context otherwise requires,—
Deflni- tiom.
(a) "Board" means the Board of trustees constituted undei section 10 or section 41;
(b) "contributing institution" means an institution which is for the time being, a contributory to the initial capital of the Trust under section 4;
(c) "contribution certificate" means a certificate issued undei section 6;
(d) "initial capital" means the capital of the Trust referrec to in section 4;
(e) "Life Insurance Corporation" means the Life Insurance Corporation of India established under the Life Insurance Cor- poration Act, 1956;
31 ef 1950.
SEC. 1] THE GAZETTE OF INDIA EXTRAORDINARY 535(f) "prescribed" means prescribed by regulations made unde this Act;
(g) "Reserve Bank" means the Reserve Bank of India con 2 of 1934. stituted under the Reserve Bank of India Act, 1934;
2 of 1034.
(h) "scheduled bank" moans a bank for the time being in eluded in the Second Schedule to the Reserve Bank of Tndk Act, 1934;
18 of 1044.
(i) "securities" means shares, debentures, bonds and othei stock of any company or other body corporate, whether incor- porated In India or outside, and securities issued by any loca] authority in India, or by the Government of, or a local au- thority in, any such country outside India as may be approved by the Reserve Bank and Includes Government security aa defi- ned in section 2 of the Public Debt Act, 1944, but does not in- clude mortgages on immovable property;
(j) "State Bank" means the State Bank of India constituted under the State Bank of India Act, 1955;
(Jc) "subsidiary bank" has the same meaning as in section 2 of the State Bank of India (Subsidiary Banks) Act, 1959;
33 of 1M".
(I) "Trust" means the Unit Trust of India established under section 3;
(m) "trustee" means a trustee appointed, nominated or elected under section 10 or section 41;
(n) "unit" means a unit issued under the unit scheme;
(0) "unit capital" means the aggregate of the face value of the units sold under the unit scheme and outstanding for the time being;
(p) "unit certificate" means a certificate issued to the pur- :haser of e unit under the unit scheme;
(q) "unit holder" means a person for the time being recog- nised by the Trust as the holder of a unit certificate under the unit scheme;
(r) "unit scheme" means a scheme made"under section 21.
eqfi THE GAZETTE OF INDIA EXTRAORDINARY [PART IICHAPTER II
ESTABLISHMENT OF THE U N IT TRUST OF INDIA AND THE INITIAL CAPITAL
THEREOF
EBtablish- ment and corporation of Unit Trust of India.
3. (1) The Central Government shall, by notification in the Offi- cial Gazette, establish a Corporation by the name of the Unit Trust of India which shall be a body corporate having perpetual succession and a common seal with power, subject to the provisions of this Act, to acquire, hold or dispose of property and to contract, and may, by the said name, sue or be sued.
(2) The head office of the Trust shall be at Bombay or at such other place as the Reserve Bank may, by notification in the Official Gazette, specify,
(3) The Trust may establish local offices, branches or agencies at any places in or outside India.
Initial capital of Trust.
4. (I) Subject to the provisions of this Act, the initial capital of the Trust shall be five crores of rupees divided in the form of certi- ficates each of which shall be of such face value as may be pres- cribed and contributed in the manner hereinafter provided.
(2) Before such date as the Central Government may, by notifl cation in the Official Gazette, specify in this behalf—
(a) the Reserve Bank shall contribute two and a half crores of rupees;
(b) the Life Insurance Corporation shall contribute seventy- five lakhs of rupees;
(c) the State Bank and the subsidiary banks shall contri- bute seventy-five lakhs of rupees, the amount which the State Bank and each subsidiary bank shall contribute being deter- mined by the State Bank;
(d) other institutions, namely, scheduled banks other than those referred to in clause (c) and such classes of financial ins- titutions as may be notified by the Central Government in the Official Gazette in this behalf may contribute one crore of rupees.
(3) If the aggregate of the contributions made by the institu- tions referred to in clause (d) of sub-section (2) exceeds one crore of rupees, the Board shall refund the excess amount to such instltu-
SEC 1] THE GAZETTE OF INDIA EXTRAORDINARY 537tions, so however, that the amount to be refunded to each such institution bears, as far as possible, the same proportion to the contribution made by it as the excess amount bears to the aggre- gate of the contributions made by such institutions.
(4) If the aggregate of the contributions made by the institu- tions referred to in clauso (d) of sub-section (2) is less than one crore of rupees, the Reserve Bank shall contribute the deficiency within thirty days of the date specified under sub-section (2):
Provided that the Reserve Bank may, thereafter, transfer the whole or any part of its contribution under this sub-section to any institution referred to in clause (d) of sub-section (2).
(5) If at any time the Board is of opinion that the amount of the Initial capital is in excess of the requirements of the Trust, it may refund the whole or any part of such capital to the contributing ins- titutions: *
Provided that where only a part is so refunded the amount to be refunded to each such institution shall bear, as far as possible, the same proportion to the contribution made by it as such part bears to the initial capital:
Provided further that far the purpose of any refund, the value of the initial capital shall be determined by the Board on such basis as the Central Government may specify in this behalf, regard being had to the real or exchangeable value thereof.
5. The Board shall maintain In such manner as may be prescribed a register containing the names of the contributing institutions, the amount contributed by each such Institution and such other parti- culars as may be prescribed.
Mainten- ance of register of contribu- tories.
Issue of contribu- tion certi- ficates.
6. (1) As soon as may be after the contribution has been made by any contributing institution under section 4, the Board shall issue to such contributing institution a contribution certificate or contribu- tion certificates in such form and containing such particulars as may be prescribed.
(2) Where the whole or any part of the contribution has been refunded to any institution under sub-section (5) of section 4, that institution shall, as soon as may be after the refund has been made, forward the contribution certificate or certificates to the Board for cancellation or amendment, as the case may be, #nd the Board shall cancel or amend the certificate or certificates accordingly.
5S? THE GAZETTE OF INDIA EXTRAORDINARY [PART II7. (1) Any contributing institution referred to in clause (d) oJ sub-section (2) of section 4 may, in the prescribed manner, transfer a contribution certificate to any other institution referred to in thai clause and thereupon such other institution shall be deemed to be a contributing institution for the purposes of this Act.
(2) Save as provided in sub-section (1), a contribution certificate JUfhtol tnuufcr of contri- bution MTti- flottMln certain eases,
shall not be transferred.
8. Every holder of a contribution certificate shall have all the rights and be subject to all the liabilities conferred or imposed on a contributing institution by or under this Act.
CHAPTER III
night* and liabi- lities of holdtra of contri- bution eartl-
MANAGEMENT OF THI TRUST
AcmtaM.
Manage-
ment,
*. (1) The general superintendence, direction and management of the affairs and business of the Trust shall vest in a Board of trustees which may exercise all powers and do all acts and things which may be exercised or done by the Trust.
(2) The Board shall, in discharging its functions under this Act, act on business principles, regard being had to the interest of the unit holders.
10. The Beard of trustees shall consist of the following, namely: —
Board of
trustees.
(o) the Chairman to be appointed by the Reserve Bank;
(b) four trustees to be nominated by the Reserve Bank, of whom not less than three shall be persons having special know- ledge of, or experience in, commerce, industry, banking, finance or Investment;
(c) one trustee to be nominated by the Life Insurance Cor- poration;
(d) one trustee to be nominated by the State Bank; (e) two trustees to be elected in the prescribed manner by the contributing institutions referred to in clause (d) of sub- section (2) of section 4; and
(f) an executive trustee to be appointed by the Reserve Bank :
Provided that if the appointment of the Chairman is whole-time, it shall not be necessary to appoint an executive trustee:
Provided further that on the first constitution of the Board, the trustees referred "to in clause (") shall be nominated by the Reserve
SlEC. 1] TttE GAZETTE OF INDIA E9£THAokDfNAB,V 5$$Bank and shall hold office for a period of twelve months from the date of their nomination or until two trustees are elected under the said clause, whichever may be earlier.
Term of
office of
trustees.
11. (1) A trustee nominated under clause (b) of section 10, if he is an officer of the Reserve Bank, or a trustee nominated under clause (c) or clause (d) of that section shall hold office during the pleasure of the authority nominating him.
(2) A trustee nominated under clause (b) of section 10, if he is not an officer of the Reserve Bank, or a trustee elected under clause (e) of that section shall hold office for four years and there- after until his successor is duly nominated or elected.
(3) A casual vacancy in the office of a trustee referred to in sub- section (2) or in the office of a trustee nominated under the second proviso to section 10 shall be filled by election or nomination, as the case may be, and the trustee so elected or nominated shall hold office for the unexpired portion of the term of his predecessor:
Provided that no such vacancy occurring within three months of the date of the expiry of the normal term of office of such trustee need be filled under this sub-section.
(4) A trustee nominated under the second proviso to section 10 or a trustee nominated in his place under sub-section (3) of this section shall be deemed to be a trustee elected under clause (e) of section 10.
(5) A person who holds, or who has held, office as a trustee shall, subject to the other provisions of this Act, be eligible for re-nomina- tion or re-election, as the case may be.
12. A person shall not be capable of being nominated or elected as a trustee if—
(a) he is, except in the case of the Chairman or the execu-
Disquali-
fication
for being
a tnaabae.
tive trustee, an officer or other employee of the Trust; or
(b) he is, or at any time has been, adjudicated as insolvent or has suspended payment of hia debts or has compounded with his creditors; or
(c) he is of unsound mind and stands so declared by a com- petent court; or
(d) he has been convicted of an offence which, in the opinion ot the Reserve Bank, involve* moral turpitude..
540 THE GAZETTE OF INDIA EXTRAORDINARY [PART H13. (1) If a trustee—
(o) becomes subject to any of the disqualifications mention-
ed .in section 12; or
Vacation and resif nation of office of trustee.
(b) is absent without leave of the Board from more than
three consecutive meetings thereof; or
(c) being a trustee elected or deemed to be elected under
clause (e) of section 10 becomes an officer or other employee of Government or of the Reserve Bank, State Bank, a subsidiary bank or the Trust,
his office shall thereupon become vacant.
(2) A trustee nominated under clause (b) of section 10 who is not an officer of the Reserve Bank or a trustee elect. ?d or deemed to be elected under clause (e) of that section may by letter addressed to the Board resign his office and on such resignation being accepted by the Board shall be deemed to have vacated his office.
14. (1) The appointment of a Chairman or of an executive trustee
may be either whole-time or part-time:
Provided that If the appointment of the Chairman is part-time, Chairman and executive trustee.
the appointment of the executive trustee shall be whole-time.
(2) The Chairman or the executive trustee shall—
(a) hold office for such term not exceeding five years as the
Reserve Bank may specify;
(b) receive such salary or allowances or both from the Trust and be governed by such terms and conditions of service as the Reserve Bank may determine; and
(c) perform such functions as the Board may entrust or
delegate to him.
Casual vacancy in office of chair- man or executive trustee.
15. If the Chairman or the executive trustee is by infirmity or otherwise rendered incapable of carrying out his duties or is absent on leave or otherwise, in circumstances not involving the vacation of his appointment, the Reserve Bank may nominate another person to act in his place until the date on which the Chairman or the execu- tive trustee, as the case may be, resumes his duties.
16. Trustees, other than the Chairman and the executive trustee, shall be paid such fees and allowances for attending the meetings of the Board or of any of its committees and for attending to any other work of the Trust, as may be prescribed:
Fe*a and allow- ances of certain trustees.
Provided that no fees shall be payable to a trustee who is an
officer of Government or of any corporation established by any law for the time being Jn force.
SEC. 1] THE GAZETTE OF INDIA EXTRAORDINARY 54!Meetings of Board.
17. (1) The Board shall meet not less than six times a year and at least once every two months and shall observe such rules of proce- dure In regard to the transaction of business at its meetings as may be prescribed,
(2) The Chairman, or, if for any reason he is unable to attend any meeting of the Board, any other trustee nominated by him in this behalf or, in the event of such nominated trustee also being unable to attend the meeting or no such nomination having been made by the Chairman, any other trustee elected by the trustees present at the meeting from among themselves, shall preside at the meeting.
(3) All questions which come up before any meeting of the Board shall be decided by a majority of votes of the trustees present and voting, and, in the event of equality of votes, the Chairman or, in his absence, the person presiding, shall have a second or casting vote.
18. (1) There shall be an Executive Committee which shall con- sist of—
(a) the Chairman of the Board, (b) where an executive trustee has been appointed by the
Executive Commit- tee and other com- mittees.
Reserve Bank, such executive trustee, and
(c) two other trustees nominated in this behalf by the Reserve Bank.
(2) The Chairman of the Board shall be the Chairman of the Executive Committee.
(3) Subject to such general or special directions as the Board may, from time to time, give the Executive Committee shall be competent to deal with any matter within the competence of the Board.
(4) The Board may constitute such other committees whether consisting wholly of trustees or wholly of other persons or partly of trustees and partly of other persons as it thinks fit and for such pur- pose as it may decide.
(5) The Executive Committee or any other committee constituted under this section shall meet at such times and places and shall observe such rules of procedure in regard to the transaction of busi- ness at its meetings as may be prescribed.
(6) The members of a committee (other than the trustees) shall be paid such fees and allowances for attending its meetings and for attending to any other work of the Trust, as may be prescribed:
Provided that no fees shall be payable to a member who is an officer of Government or of any corporation established by any law for the time being In force.
843 G of I Ext.—2.
iA2 THE GAZETTE OF INDIA EXTRAORDINARY [PA:<'I IICHAPTER IV
P0WKR6 AND FUNCTIONS OF THE TRUST
19. (1) The Trust may carry on and transact any of the follow- Biisjncs,.v of Trust
yig kinds of biwiness, namely: —
(a) selling and purchasing units;
(b) Investing in, acquiring, holding or disposing of, securi- ties and exercising and enforcing all powers end rights incidental thereto;
(c) keeping money on depusit with scheduled banks 01 with such other institutions as may be prescribed;
(d) generally, doing all such matters and things as may be incidental to or consequential upon the discharge of its functions under this Act.
(2) The Trust shall not take on lease, purchase or otherwtec acquire except for its own use eny immovable property or any interest therein.
Borrow Ulf powen
20. (I) The Trust may borrow from any authority or person, not being Government or the Reserve Bank, against such security and on such terms and conditions as may be agreed upon.
(2) The Trust may borrow money from the Reserve Bank repay- able on demand or on the expiry of a fixed period not exceeding ninety days from the date on which the money is so borrowed ogainst stocks, funds and securities (other than immovable property) in which a trustee is authorised to invest trust money by any law for the time being in force in India.
(3) If the Board is of opinion that a situation has arisen in which it is necessary or expedient for the Trust to borrow money from the Reserve Bank against securities other than those mentioned in sub- section (2), the Trust may borrow money from that bank repayable on demand or within a period not exceeding eighteen months from the date on which the money is so borrowed against its own bonds which the Trust may issue with the approval of the Central Govern- ment
(4) The bonds issued by the Trust under sub-sectdon (3) shall be guaranteed by the Central Government as to the repayment of prin- cipal and the payment of Interest at such rate as may be fixed by the Central Government at the time the bonds are issued.
Unit scheme
21. (1) For the purpose of providing facilities for participation in the income, proflti and gains arising out of the acquisition, holding,
SEC. 1J THE GAZETTE OF INDIA EXTRAORDINARY 5.43management or disposal of securities by the Trust, the Board shall make a unit scheme.
(2) Subject to the provisions of this Act, and the regulations made under section 43, a scheme made under aub-section (1) may provide for—
(a) the issue of units and the face value of each unit, which shall not be less than ten rupees or more than one hundred rupees;
(b) the form and manner in which an application may be made for the purchase of a unit from the Trust;
(c) the manner in which payment may be made for pur- chasing a unit from the Trust;
(d) the issue of unit certificates and the form and manner in which such certificates may be issued;
(e) the issue of duplicate of any unit certificate in the event of loss or destruction of the original and the fee on the payment of which such duplicate may be issued;
(f) the procedure for determining the value at which the units may be said or purchased, from time to time, by the Trust;
(g) the recognition of persons as unit holders;
(h) the persona to whom, the time at which and the man- ner in which any payments in respect of a unit shall be made by the Trust;
(i) the preparation and maintenance of a register, if any, of unit holders;
(j) the conditions, if any, subject to which a unit holder may transfer the unit;
(Jc) any other matter which the Trust may consider to be necessary or proper for the effective implementation of the scheme.
(3) The Board may, from time to time, add to or otherwise amend the scheme made under sub-section (1).
(4) The scheme made under sub-section (1) and every amend- ment thereof under sub-section (3) shall be notified in the Official Gazette.
CHAPTER V
ALLOCATION AND DISTRIBUTWN OF INCOME
22. (1) The total gross income of the Trust in any year shall be allocated to the initial capital and the unit capital in the same pro- Dortion as the former bears to the latter at the end of that year.
Alloca- tion of income, interest and other expenses.
(2) The interest payable for any year for any borrowings made by the Trust and the total amount of other expenses incurred by the Trust in that year shall be allocated and charged to the initial capital and the unit capital in the same proportion as is referred to in sub-section (1):
Provided that if the amount of expenses other than interest allo- cated to the unit capital is more than five per cent, of the gross income allocated to the unit capital in that year, only an amount equal to such five per cent, shall be charged to the unit capital and the rest of the total amount of expenses other than interest shall be charged to the initial capital,
Distribu- tion of income.
23. (1) The gross income allocated to the initial capital in any year reduced by the interest and the amount of other expenses charged for that year to the initial capital may be distributed in the prescribed manner among the contributing institutions in pro- portion to their contributions to the initial capital.
(2) The gross income allocated to the unit capital in any year reduced by the interest and the amount of other expenses charged for that year to the unit capital may, but not less than ninety per cent, of the gross income so reduced shall, be distributed to the unit holders in respect of that year.
24. Notwithstanding anything contained in section 22 or section 23, Distribu- tion of income after refund of initial capital.
where the whole of the initial capital has been refunded to the con- tributing institutions, the gross income in any year reduced by the- interest payable for that year for any borrowings made by the Trust and the total amount of other expenses incurred by the Trust in that year may, but not less than ninety per cent, of the gross income so reduced shall, be distributed to the unit holders in respect of that year.
Definition of ytt
25. In this Chapter "year" means the period in respect of which the books and accounts of the Tr^ist are balanced and closed under sub-section (2) of ntfction 26.
SEC. 1] THE GAZETTE OF INDIA EXTRAORDINARY 545CHAPTER VI
ACCOUNTS AND AUDIT
26. (1) The balance-sheet and accounts of the Trust shall be pre- pared and maintained in such form and manner as may be prescribed.
Prepara- tion of balance- sheet, etc., of Trust.
(2) The Board shall cause the books and accounts of the Trust >o be balanced and closed each year as on such date as may be prescribed,
1 of lt>56.
Audit.
27. (1) The affairs of the Trust shall be audited by an auditor luly qualified to act as an auditor under sub-section (1) of section 226 of the Companies Act, 1956, who shell be appointed by the Trust ind shall receive such remuneration as the Trust may fix.
(2) The auditor shall be supplied with a copy of the annual balance-sheet of the Trust and it shall be his duty to examine it ;ogether with the accounts and vouchers relating thereto and he shall lave a list delivered to him of all books kept by the Trust and shall it all reasonable times have access to the books, accounts, vouchers md other documents of the Trust.
(3) The auditor may, in relation to such accounts, examine any trustee or any officer or other employee of the Trust and shall be entitled to require from the Board or officers or other employees of Ihe Trust such information and explanation as he may think neces- sary for the performance of his duties.
(4) The auditor shall make a report to the Trust upon the annual balance-sheet and accounts examined by him and in every such report he shall state whether in his 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 fair view of the state of affairs of the Trust and in case he had called for any information or explanation from the Board or any officer or other employee of Iho Trust, whether it has been given and whether it is satisfactory.
Publication of annual accounts and reports.
28. The Trust shall furnish to each of the contributing institutions within four months from the date on which its accounts are balanced and closed in respect of any year a copy of the balance-sheet and accounts together with a copy of the auditor's report and shall pub- lish the same in the Official Gazette.
29. The Trust shall furnish, from time to time, to the Reserve Bank such information as the Reserve Bank may require.
Furnishing of informa- tion to Re- serve Bank.
546 THE GAZETTE OF INDIA EXTRAORDINARY [PART IICHAPTER VII
MISCELLANEOUS
Power D( Reserve Bank to give directions.
30. In the discharge of its functions under this Act, the Trust ^hall be guided by such directions in matters of. policy involving public interest as the Reserve Bank may give to it in writing, and if iny question arises whether the direction relates to " matter of policy nvolving public interest, the decision of the Reserve Bank thereon .hall be final.
Staff of Trust
31. (1) The Trust may appoint such number of officers and other employees as it considers necessary or desirable for the efficient per- formance of its functions and determine the terms and conditions of heir appointment and service.
(2) Without prejudice to the provisions of sub-section (1), it shall be lawful for the Trust, to utilise, and for the Reserve Bank to nake available, the services of such staff of the Reserve Bank on ;uch terms and conditions as may be agreed upon between the Trust and the Reserve Bank.
ilof 1M1 14 of 1963 Income- tax and other taxes
32. (1) Notwithstanding anything contained in the Income-tax A.ct, 1961, the Super Profits Tax Act, 1963, or in any other enactment Cor the time being in force relating to income-tax, super-tax or super profits tax, or any other tax on income, profits or gains—
(a) the Trust shall not be liable to pay income-tax, super- tax, super profits tax or any other tax in respect of any income, profits or gains derived by it from any source;
(b) where the income received by a unit holder, being an in- dividual, from the Trust in respect of units does not exceed one thousand rupees, such income, and where such income exceeds one thousand rupees, a sum of one thousand rupees, shall be excluded in computing the total income of the unit holder for purposes of income-tax and in the case of any such unit holder who would not be liable to super-tax but for the inclusion of such income in his total income, also for purposes of super-tax; and
14 of I9ft3 (c) where a contributing institution is liable to be assessed to super profits tax under the Super Profits Tax Act, 1993, in res- pect of its own income, profits or gains and receives any sum from the Trust under this Act in respect of its contribution to the initial capital, such sum as reduced by the amount of any income-tax and super-tax payable in respect thereof shall be excluded from, the total income of the 3aid institution in compu- ting its chargeable profits for the purposes of super profits tax
S*c 1 ] THE GAZETTE OF INDIA EXTRAORDINARY 5 47(2) Notwithstanding anything contained in section 193 or sectio 43 of 1861 194 of the Income-tax Act, 1961—
(a) no deduction of income-tax or super-tax shall be mad on any interest or dividend payable to the Trust in respect o any securities or shares owned by it or in which it has full ber_e flcial interest; and
(b) no deduction of income-tax shall be made by the Trus from the income distributed by it to a unit holder being an in dividual.
(3) Subject to the foregoing sub-sections, for the purposes of th< 43 of ]yei Income-tax Act, 1961,—
(a) any distribution of income received by a unit holdei from the Trust shall be deemed to be his income by way of divi dends; and
(b) the Trust shall be deemed to be a company.
33. The Bankers' Books Evidence Act, 1891 shall apply in relatior to the Trust as if it were a bank as denned in section 2 of the saic Act.
Act 18 oi 1801 to •PPly in relation to Trust
Declara- tion of fidelity and secrecy 34 Every trustee, auditor, officer or other employee oi the Trusi or any employee of the Reserve Bank whose services arc utilised bj the Trust under section 31 shall, before entering upon his duties make a declaration of fidelity and secrecy in the form set out in the First Schedule to this Act.
35. (1) No act or proceeding of the Board or of any committee oi
the Trust shall be questioned on the ground merely of the existence of any vacancy in, or defect in the constitution of, the Board or com- mittee.
Defects in ap- point- ments not to invalidati acts, etc (2) No act done by any person acting in good faith as a trustee shall be deemed to be invalid merely on the ground that he was dis- qualified to be a trustee or that there was any other defect in his nppointment.
Indemni- ty of trustees 36. (1) Every trustee shall be indemnified by the Trust against all losses and expenses incurred by him in, or in relation to, the dis- charge of his duties except such as are caused by his own wilful act nr default.
(2) A trustee of the Board shall not be responsible for any other wustee, or for any officer or other employee of the Trust, or for any loss or expenses resulting to the Trust, from the insufficiency or de- ficiency of value of or title to any property or security acquired or taken on behalf of the Trust or the insolvency or wrongful act of any debtor or any person under obligation to the Trust or anything done
548 THE GAZETTE OF INDIA EXTRAORDINARY [PART IIin good faith in the execution of the duties of his office or in relation thereto.
Protec- tion of action taken under this Act,
37. No suit or other legal proceeding shall lie against the Trust or the Reserve Bank or any trustee or any officer or other employee of the Trust or the Reserve Bank or any other person authorised by the Trust to discharge any functions under this Act for any damage caused or likely to be caused by anything which is in good faith done or intended to be done in pursuance of this Act.
Delega- tion of power*.
38. The Board may, by general or special order, delegate to any officer of the Trust, 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.
3ft. (2) No notice of a trust, express, implied or constructive, shall
be receivable by the Trust.
No trust to be taken notice of and pro- tection from at-
tachment
(2) The amount standing to the credit of a contributing institu- tion shall not be liable to attachment under any decree or order of any court in respect of any debt or liability incurred by the contribu- ting institution.
40. (1) In the event of a contributing institution referred to In clause (d) of sub-section (2) of section 4 being wound up, the Trust shall, on a demand in that behalf made by the authority in charge of the winding up, pay to such authority an amount equivalent to the value of the contribution to the initial capital made by that Institu- tion,
Repay- ment of contri- bution in cased winding up of con- tributing Institu- tion.
(2) The value of the contribution shall be determined by the Board on such basis as the Central Government may specify, regard being had to the real or exchangeable value of such contribution.
41. (1) Notwithstanding anything contained in section 10 or sec- tion 11, where the whole of the initial capital has been refunded to the contributing institutions, the Central Government may, after consultation with the Reserve Bank, by order, provide for the reconstitution of the Board-
Power of Central Govern- ment to reconsti- tute Board.
(2) An order made under sub-section (I) may provide for all or
any of the following matters, namely:—
(a) the number of trustees that will constitute the Board;
(6) the manner in which they shall be chosen;
(c) their term of office;
(d) filling,of casual vacancies;
SEC, 1] THE GAZETTE OF INDIA EXTRAORDINARY 549(e) such incidental, consequential and supplementary mat- ters as may be necessary to give effect to the order including the reconstitution of the executive committee or other committees.
(3) Every order made under this section shall be published In the Official Gazette and a copy thereof shall be laid before each House of Parliament as soon as may be after it is made.
42. (1) The Trust shall not be placed in liquidation save by order of the Central Government and in such manner as it may direct-
Liquida- tion of Trust.
(2) In making such order, the Central Government shall, if the initial capital has not been wholly refunded, direct, among other things, that—
(i) the value of the net assets of the Trust after paying off all its liabilities, other than those in respect of the initial capital arid the unit capital shall be divided into two parts in the same proportion as the aggregate face value of all the units immediate- ly prior to the date on which the Trust is placed in liquidation bears to the initial capital as on that date; and
(ii) the first part shall be distributed among the contribut- ing institutions in proportion to their respective contributions to the initial capital as on that date and the second part shall be distributed among the imit holders in proportion to the face value of the units held by them as on that date.
Reguia tions.
43. (1) The Board may, with the previous approval of the Reserve Bank, make regulations not inconsistent with this Act 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 oregolng power, such regulations may provide for—
(a) the form and manner of maintenance of the register of contributing institutions and the particulars to be contained therein;
(b) the face value of a contribution certificate, its form and the particulars to be contained therein;
(c) the manner of transfer of a contribution certificate;
(d) the rights and liabilities of a contributing institution;
(e) the holding and conduct of elections under this Act, in- cluding the final decision on doubts or disputes regarding the validity of elections;
(f) the fees and allowances that may be p"id to the trustees;
843 G of I Ext.—3.
<<0 THE GAZETTE OF INDIA EXTRAORDINARY [PART U(g) the times and places of the meetings of the Board or ol any committee constituted under this Act and the procedure to be followed at such meetings including the quorum necessary for the transaction of business;
(h) the fees and allowances that may be paid to tha mem- bers of a committee, other than trustees;
(i) the institutions with which myney may be kept on de- posit;
(j) the manner of distribution of income to the contributing institutions;
(fc) the form and manner in which the balance-sheet and the accounts of the Trust shall be prepared and maintained;
(I) the date on which the books of accounts of the Trust shall be balanced and closed each year;
(m) the duties and conduct, salaries and allowances, and other conditions of service of officers and other employees of the Trust;
(n) the establishment and maintenance of provident or other benefit funds for officers and other employees of the Trust; and (o) any other matter which ia to be, or may be, prescribed.
(3) Any regulation which may be made by the Board under this Act may be made by the Reserve Bank within three months of the establishment of the Trust and any regulation so made may be altered or rescinded by the Board in the exercise of its powers under this Act.
44. The enactments specified in the Second Schedule to this Act Hhall be amended In the manner provided therein.
Amend- ment of cwrtain enact- ments.
SEC 1| THE GAZETTE OP INDIA EXTRAORDINARY 551THE FIRST SCHEDULE
(See section 34)
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 trustee, auditor, officer or other employee (as the case may be) of the Unit Trust of India and which pi'operly relate to the office or position held by me in the said Trust.
I further declare that I will not communicate or allow to be com- municated to any person not legally entitled thereto any information relating to the affairs of the Unit Trust of India or to the affairs of any person having any dealing with the said Trust; nnr will I allow any such person to inspect or have access to any books or documents belonging to or in the possession of the Unit Tru.st of India and relat- ing to the business of the said Trust or the business of any person having any dealing with the said Trust,
(Signature)
Signed before me:
THE SECOND SCHEDULE
(See section 44)
AMENDMENT OF CERTAIN ENACTMENT?.
PARTI
AMENDMENTS TO THE RESERVE BANK OF INDIA ACT. 1934
(2 OF 1934)
Amendments
1. In section 2, after clause (f), insert the following clause,
namely: —
Amend- ment of section 2.
'(g) "Unit Trust" means the Unit Trust of India established
under section 3 of the Unit Trust of India Act, 1963.'.
2. In section 17,—
(a) after clause (4BB), insert the following clause, namely: —
Amend- ment of section 17.
"(4BBB) the making to the Unit Trust of loans and
advances—
(i) repayable on demand or on the expiry of a fixed period not exceeding ninety days Jrom the date of
552 THE GAZETTE OF INDIA EXTRAORDINARY [PAHT IIsuch loan or advance against the security of stocks, funds and securities (other than immovable property) in which a trustee is authorised to invest trust money by any law for the time being in force in India, or
(ii) repayable on demand or within a period of eighteen months from the date of such loan or advance against the security of the bonds of the Unit Trust issued with the approval of and guaranteed by the Central Government;";
(b) after clause (4E), insert the following clause, namely: —
"(4F) contributing to the initial capital of the Unit Trust.".
PART II
AMENDMENT TO THE INDUSTRIAL DISPUTES ACT, 1947 (14 OF 1947)
Amendment
In section 2, in sub-clause (i) of clause (a), after "Deposit Insur- ance Corporation Act, 1961 or" insert the following, namely: —
Amend- ment of section 2.
"the Unit Trust of India established under section 3 of the Unit Trust of India Act, 1963, or".
PART III
AMENDMENT TO THE INDUSTRIAL FINANCE CORPORATION ACT, 1948
(15 OF 1948)
Amendment
For section 20, substitute the following, namely: —
Substitu- tion of new a c- tion for section 20.
Investment of funds.
"20. The Corporation may invest its funds in the securities of the Central Government or of any State Government and may, with the approval of the Central Government, contribute to the initial capital of the Unit Trust of India established under the Unit Trust of India Act, 1963.".
SEC. I] THE GAZETTE OF INDIA EXTRAORDINARY 553PART IV
AMENDMENT TO THE STATE BANK OF INDIA ACT, 1955
(23 OF 1955)
Amendment
In section 33, after clause (xix a), insert the following clause, namely: —
Amend- ment of section 33.
" (onx aa) contributing to the initial capital of the Unit Trust of India established under the Unit Trust of India Act, 1963;".
R. C. S. SARKAR,
Secy, to the Govt. of India.