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REGISTERED NO. D. (D)-72

The Gazette of India

EXTRAORDINARY

PART II--Section 3—Sub-section (i)

PUBLISHED BY AUTHORITY

No. 37] NEW DELHI, TUESDAY, FEBRUARY 3, 1981/MAGHA 14,1902

Separate paging is given to this Part in order that it may be filed as a separate compilation

(87)

1290 GI/80

88 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(i)l

90 THE GAZE1TE OF INDIA EXTRAORDINARY [PART II—SLC 3 ( I )1

MINISTRY OF SHIPPING AND TRANSPORT

(Transport Wing)

NOTIFICATION

New Delhi, ihe 3rd February, 1981

G.S.R. 44(E).—In exercise of the powers conferred by section 19 of the Merchant Shipping Act, 1958 (44 of 1958) lead with section 21 of the General Clauses Act, 1897 (10 of 1897), the Central Government makes the following rules, nasnely :—

1. Short title, application and commencement.—(1) These rules mjy be called the Shipping Development Fund (Loans and Oiler Financial Assistance) Rules, 1981.

(2) I hey shall apply to loans and financial assistance to fishing companies for the acquisition and maintenance of tiawlers.

(3) They shall come into force on the date of their publi-

cation in the Official Gazette.

2. Definitions.—In these rules, unless the context otherwise

leq"!!^ —

(a) "Act" means the Merchant Shipping Act, 1958 (44

of 1958) ;

(b) 'Application" means an application made under

jule 3 ;

Ui) " ( Qirrpitiee" means the Shipping Development Fund

Committee ;

fe) 'fishing company"' means a company formed and registered under the Companies Act, 1956 (1 of 1956) and having sea fishing as its main object ;

(f) "Fund"' means the Shipping Development Fund ;

(g) "Nominee Directoi" means the director nominated by the Committee on the Board of Director of a fishing company in the private sector ;

92 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(i)]

(h) "Secretary" means the Sccictary to the CommiUce and includes any Additional, Joint, Deputy and Assistant Secretary ;

(i) "trawler"' means a fishing vessel and includes a purse- seiner, long liner and a combination vessel for multipurpose fishing, having, in each case, an overall length of not less than twenty metres'.

3. Application foi loan or other financial assistance-—• (1) A fishing company desirous o[ ia:sing a loan or obtaining other financial assistance from the Fund for the acquisition uud maintenance of trawlers shall apply to such officer as the Cential Government in the Dcpaitment of Agriculture may, by notification in the Official Gazette, authorise in this behalf (hereinaflcr referred to as the Authorised Officer).

(2) Ifverv application referred to in sub-iule (i) shall be made in such form as is specified Part 'A' of the form of application set out in Ihc Appendix to these rules, and every such applicalion shall be accompanied by an attested copy of the i evolution of the fishinu company authorising the raising of the lonn or obtaining other financial assistance.

4. Scrutiny of application.—-The Authorised Officer shall scrutinise every application leceived by him and after such scrutiny, the Central Government in the Department of Agriculture shall, after making necessary entries in Part B of the form of application, forward it to the Secretary.

5. Consideration by the Committee.—The Secretary shall then place the application before the Committee for consi- deration at its next meeting, or in case of urgency, at a meet- ing specially convened for the purpose with the approval of the Chairman.

fi. Decision of the Committee to bz recorded.—The decision of the Committee on each application, shall be recorded in wriling in the form of minutes, duly approved by the Chair- man.

7. Loan exceeding Rs. 100 lakhs to be made with the prior npptovnl of Cential Government.—The Committee shall not gr;mt any loan or other financial assistance exceeding Rs. 100 lone hundred) lakhs in value except with the prior approval of the Central Government in the Ministiy of Shipp- ing and Transport.

8. Terms of loan or other financial assistance,—(1) Every loan or other financial assistance granted under these rules shall be on Ihe terms and ronditions specified from time to time by Ihe Central Government in pursuance of sub-section (2) of section 16 of the Act.

(2) No loan or other financial assistance shall be granted to a fishing company unless such company has furnished secuiity to the satisfaction of the Committee.

9. Communication of decision.—The Secretary shall com- municate to the fishing company and to the Central Govern- ment in the Department of Agriculture tho decision on the application and the terms and. conditions under which the loan or other financial assistance has been granted to lie fishing company.

10. Acceptance loan oi other financial assistance and execu- tion of loan documents—(11 If the terms and conditions of the lo n or other financial assistance are acceptable to the fishing company, it shall arrange to have a resolution, passed at a meeting of the Board of dircctois, or.wfcre necessary, the re olution of the company in general meeting, authorising the raising of Ihe loan or obtaining other financial assistance on the teims and conditions, specified by the Central Govern- ment, and also authorise an officer of the fishing company to execute, on behalf of the fishing company, the documents specified in sub-rule (5), and to affix the common seal of the company on such documents,

(2) The resolution referred to in sub-rule (1) shall specify the assets, which are proposed to be offered as security for the loan or other financial assistance, as the case may be, or the other securities which are proposed to be offered for the purpose aforesaid, and that the terms and conditions .specified by the Central Government arc acceptable to the Company.

(3) It shall be the duly of the Secretary to get the docu- ments, specified in sub-rule (5), executed by or on behalf of the fishing company.

(4) No loan or other fimuicial assistance shall be released to a fishing company unless a deed moitgaging the trawlers/ vessel has been duly executed by or on behalf pi the fishing company, or such other security as is acceptable to the Com- iniUee has been duly furnished, to the satisfaction of the Committee and the fishing company has —

(a) rcgistcied such mortgage with the Registrar of the Companies us required by the Companies Act, 1956 (1 of 1956) and in the case of mortgage of any ether assets offered as secuiity by the company it has been registered by other authorities where re- quired by law so to do, and thereafter also registered with the Registiai of Companies as aforesaid ;

(b) taken out piopcr insmancc policies in respect of the trawlers or any other assets of the company offocd as secuiity to the Committee and duly assig- ned such in nuance policies to the Committee ;

the Registrar of Ships.

5. The documents referred to in sub-rule (2) are —

(a) the loan agreement,

(b) mortgage deed in respect of the trawlers mortgaged

as secuiity,

deed,

(d) in the case of bank guaiantce or any other form of secuiity approved by the Committee, the relevant documents to be executed in that connection,

(e) tripartite agreement to be executed between shipyard,

fishing company and SDFC.

(f) any other documents which in the opinion of the Committee is considered necessary and essential to safeguard the interests of the Committee.

11. Payment of [ oan Amount.— \fter all foimalities referred to in rule 10 have been complied with by the borrowing fish- ing company, the secretary shall draw a cheque in favour of the company for the amount of loan, or, where the Com- mittee intends to give a guarantee for the due payment of the duei of the fishing comnany in relation to the acquisi- tion and maintenance of. trawlers, the Secretary shall draw up the deed, or letter of guarantee and get it executed by or on '.'duK of the Committee, and where the amount is to be paid in instalments, the Secretary shall draw the cheques in favoui of fishing company on the due dates and for the appropriate amount of such instalments.

12. Payment of Loan.—(1) The borrowing fishing company shall repay the amount of the loan and the interest thereon in accordance with the terms and conditions of the loan, under intimation to the Department of. Agriculture ;

(2) The Depattment of Agriculture and, where the borrow- ing fMiini; company is a company which is not owned or controlled" by Government, also the Nominee Director shall keep a watch,—

(a) on the repayment of the loan and shall bring any default b\' (he horroiving fishing company to the notice of the Secretary who sh;ill immediately make a report to the Committee for such action as tho Committee may consider necessary ;

fh) generally on the affairs of the borrowing fishing com- p.ny and shall immediately bi ing to the notice of the Secretary any happenings or development which may affect the creditworthiness of the borrowing fishing company or the sca-woithincss of (he traw- lers mortgaged to the Committee.

[F. No. SW/MSD(70)/79-MD]

A. PADMANABAN, Jt. Secy.

APPENDIX

(See rule 3, 4, and 6j

(f) Loans guarantee assistance earlier taken from Shipping Development Fund Committce/Go- vernmcnt/Other institutions (Give details).

FORM OF APPLICATION

PART A

{g) Other Capital Receipts; if any (give details).

Total IV

(h) Total III and IV-(V)

APPLICATION FOR LOAN OR OTHER FIANANCIAL

ASSISTANCE

1. Name and address of the applicant with date of

incorpoi ation :

2. Authorised Capital of the fishing Company :

3. Debt Equity Ratio : 4. Tv>ued, subscribed and paid-up capital as certified by the company auditor or as per last balance sheet ;

5. Does the applicant satisfy the requirements of section 21 of the Merchant Shipping Act, 1958 (Give details to elucidate the answer) In case of company, names of Directors and their tech- nical qualifications :

6. Number and total G.R.T. of vesseKs) owned bv the applicant and its/their insured value and also ils/their market value :

7. In the case of companies in existence for three years or more copies ol balance sheet and pro- fits and loss accounts for the last three years (indicating working results assets liabilities and dividends if any, declared) may be furnished. In the case of others necessary information to (he extent available may be furnished

8. Surplus fundi available as on

(a) Last Balance Sheet date.

(i) Current assets.

(1) Deduct out RO :

(i) Gross payment to Shipyard/Financing Institu-

tions on existing fleet.

(ii) Gioss payment us above on trawlers delive-

red during the year (give details).

(iii) Repayment of principal to Shbping Deve- lopment Fund Committee/Government/ other financing institutions on :

(a) Loans already sanctioned.

(b) Loans /guarantee applied for (iiive details),

details).

(M Payment of interest to :

(a) Shipping Development Fund Committee/ Goveinment/other financing institutions.

(b) To Shipyard or trawler delivered during the ycir (un'css the interest charges have already been taken into account in arriving at New

Surplus).

(v) Dividend.

(vi) Other Capital out-go, if any, like Taz etc.

ToU

(b) To Shipyard or trawler delivered during the

(kl (Deduct) working capital requirement (Basis of

assessment may be given).

Total VIII

(ii) Loans and advances.

(iii) Investments.

(iv) Unfinished Voyages/anticipa'tcd earnings/

still to be recovered,

(v) Other current Assets, if any, (details may

please be furnished)

Note : In future years, only the increase on this account If any, is to be provided for. Reasons for pro- posing the increase should be explained.

(1) Net Surplus Resources available us on (the end of

the cur:cr.t financial ycai) (i.e. VII-V1II)

Note ; Similar statement should be prepared for the next

four years.

Total (I)

Less investment and other current assets, if any, tied up us security or otherwise not mobilizable (Details may be furnished).

(b) :

(i) Current Liabilities,

(ii) Provisions,

(iii) Unfinished voyages /advance earnings.

(iv) Other current liabilities, if any, (furnish

details).

Total (II)

(e) Net total (l-ln-III

(d) Add : Generation of resources during the current

financial year.

(i) Depreciation on existing fleet,

(ii) Net sutplus on existing fleet (after provid- ing for interest charges), including Non- Operating earnings'.

year, separately for each.

(ii) Operating surplus on above separately for each trawler if indicate details of calcula- tions of fi) and fii) above).

(j) Net Surplus available (i.e. V-VI)-VII

ties upon the end of the assessment year pre-

ceding the date of application of loan.

(ii) Provision made to meet such liabilities and

particulars thereof.

(iii) The actual annual assessment for income- tax and other taxes as against details given in (i) above.

(iv) Whether any pioceedings were taken or are pending against the applicant for recovciy of taxes ? If so, furnish full details.

10. Particulars of loan(s) if any, already granted to the applicant by Government of India/Shipping Development Fund Committee.

(i) Amount/s of loan/s, date of grant and rate

of interest.

(ii) Trawlers against which the loan/s was/ were

granted.

(iii) Repaynicnt(s) commended or to commence fiom which date and to be made in how many instalments.

(iv) Whether there has heen in the past any de- fault in the payment of instalment of other principal or interest and, if so, on how many occasions and for what reasons.

94 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(i)]

(v) What action, ii" any, was taken by the lending authority in connection with the default refer- red to above,

fvl) Outstanding balance of Government/Shipping Development Hind Committee loan(s) and also other loan(') if any,

11. (i) Whether there has been any default in the compliance of any o[ the terms of the loan agreements and other loan documents in res- pect of loans mentioned in item 10 rind, if so. on how many occasions and for what leasons.

(ii) Whether the applicant has been subject to puni- tive action by other Ministries/Dcpaitments of Government and, if so, the particulars thereof and ihc itiiOns (htM-foi. Full de-

l.iils should be furnishsd.

12. d) Trailers now proposed to be acquired or

built.

(iil Area in which the trawlers to be acquired or

built will be operated.

(iii) Cost ol tiLwleia.

(iv) Amount of loan or other financial assistance

now jequired from the fund.

13. What security, in addition to the morlgage of the loan trawler, is the company prepared to officer, if so, required by the Shipping Develop- ment Fund Committee and pending the build- ing of the loan trawler, what ir.lerim security is proposed to be furnished ?

14. If the trawler(s) in the existing conditions, and is/are proposed to be purchased second-hand, if the applicant is satisllcd that the trawler(s) is/are (a) in good condition (b) the price is rea- sonable (c) suitable for the trade for which in- tended ? Copies of any reports etc. received by the Company regarding (a) may be furnished.

15. What dorinrent.ily proof the applicant furnishes in support of the actual cost of acquisition or building of the trawlers.

16. Whether the applicant is aware of the terms on whioh the loans aic usually granted by the Shipping Dcvolop-ncnt Fund Committee and, jf so, whether the company is prepared to accept them in entity : or, if not. in what respect the company dcires :no lification of these terms and for what reasoas ?

17. (i) Anticipated working results in future, and

(ii) Whether such results fulJy establish the possi- bility of the applicant lepaying the loan with- in the period of amortisation with any diffi- culty.

To be signed by the applicant or his authorised representative.

PART B

CIo b- fllied by the Department of Agiiculturc in the Ministry i't VijiiLukurc and Inigution, Government of India).

1. Is thj Department of Agriculture satisfied that the particular furnished abo\e by the applicant arc i-orre;t to (he extent that they can be verified 7

2. In particular, docs the apnli.ant satisfy the require-

ments of • ection 21 of the Merchant Shipping Act, 1958 (44 of 195K) 7

3. Is the Department pf Agriculture generally satisfied after mating such consultation as they deem neces- sary from iheir Technical Officers and Director of Fisheiies of the State concerned, that the fishing ve M"I(S) proposed to be purchased ot built is/are good for the pi ice proposed tq be paid and is/arc suitable for the trade(s) in which it is intended to be put ?

4. Docs the Department of Agriculture recommend the jirunt of loan app'icd for by the fishing company ? Are they satisfied that there is a reasonable pros- pect of the applicant being able to repay the loan within the period of amortisation and ihe security o.'.cred by the company incI.Hng the interim secu- lily is good and sufficient ?

5. (i) Whether the Department of Agriculture, while i ecommending the grant of loan, has taken into consideration the liquid cash resources of the applicant available with it and reserves built by it 7 If so, do they still recommend the full loan applied for and, if so, for what reasons 7

(ii) Whether the applicant has committed any default in the compliance of the terms of the loan docu- ments in respect of loans already granted cither by Government of Inuia or the committee, and, if so, on how many occasions and for what reasons and with what results ?

(iii) Has the Department of Agriculture come across nny adveise icmnrks from other departments of the Government or other sources in the activities of the applicant, and if so, details thereof may be given. In (he light of these adverse remarks, do thev 'till recommend the loan applied for and .f to on what precise grounds ?

6 In ense the applicant de\ires any modifications of the usual terms to what extent docs the Department of Agriculture recommend them and on what precise giounds ?

7, Has the Department of Agricultuie any special com-

ments to olfor on the proposal 7

Department of Agriculture

Ministry of Afiiiculturc and Irrigation,

PRINTTD BY THE MANAGER, GOVT. OF INDIA PRESS, RINtj ROAD, NEW DELHI-110064

AND PUBLISHED BY THE CONTROLLER OF PUBLICATIONS, DELIII-110054, 1981