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AGRICULTURAL REFINANCE AND DEVELOPMENT CORPORATION ACT 1963

Ministry of Law and Justice

Act nº 10 of 1963


  • Chapter I
  • Chapter II
  • Chapter III
  • Chapter IV
  • Chapter V
  • Chapter VI
  • Schedules
  • Act nº 10 of 1963

Preamble

Agricultural Refinance and Development Corporation Act, 1963

[Act No. 10 of 1963]

[24th March, 1963]

PREAMBLE

Be it enacted by Parliament in the Fourteenth Year of the Republic of India as follows: -

Chapter I

Section 1. Short title, extent and commencement

(1) This Act may be called the Agricultural Refinance1[and Development] Corporation Act, 1963.

(2) It extends to the whole of India.

(3) It shall come into force on such date as the Central Government may, by notification in the official Gazette, appoint.

1. Inserted by Act 45 of 1975, w.e.f. 15.11.1975.


Section 2. Definitions

In this Act, unless the context otherwise requires,

(a) "agriculture" includes animal husbandry, dairy farming, pisciculture and poultry farming;

1[Explanation.-For the purposes of this clause, 'pisciculture' includes the development of fisheries, both inland and marine, catching the fish and all activities connected therewith or incidental thereto;]

(b) "Board" means the Board of directors of the Corporation;

2[(c) 'central land development bank' means the principal land development bank in a State (by whatever name called), which is registered, or deemed to be registered, under the Co-operative Societies Act, 1912 (2 of 1912), or any other law for the time being in force in any State relating to co-operative societies and the primary object of which is the providing of long-term finance for agricultural development:

Proivided that, in addition to such principal land development bank in a State, or where there is no such bank in a State, the State Government may, with the previous approval of the Reserve Bank, declare any co-operative society carrying on business in that State and authorised by the bye-laws of such co-operative society to provide long-term finance for agriculture development, to be a central land development bank within the meaning of this Act;]

(d) "co-operative society" means a society registered, or deemed to be registered, under the Co-operative Societies Act, 1912 (2 of 1912 ), or any other law for the time being in force in any State relating to co-operative societies;

(e) "Corporation" means the Agricultural Refinance and Development Corporation established under this Act;

(f) "eligible institution" means

(i) a3[central land development bank] or a State co-operative bank or a scheduled bank, being in each case a shareholder of the Corporation;

(ii) a co-operative society (other than a3[central land development bank] or a State co-operative bank) approved by the Reserve Bank in this behalf;

(iii) an Agricultural Credit Corporation established under 3 of the State Agricultural Credit Corporation Act, 1968;

(iv) such other institution as may, on the recommendation of the Reserve Bank, be approved by the Central Government in his behalf;.

(g) "Life Insurance Corporation" means the Life Insurance Corporation of India established under 3 of the Life Insurance Corporation Act, 1956 (31 of 1956);

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

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

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

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

1. Inserted by Act 39 of 1971.

2. Substituted by Act 45 of 1975 w.e.f. 15.11.1975.

3. Substituted by Act 45 of 1975 w.e.f. 15.11.1975.


Chapter II

Section 3. Establishment and incorporation of Agricultural Refinance Corporation

(1) With effect from such date as the Central Government may, by notification in the official Gazette, appoint, there shall be established for the purposes of this Act a Corporation to be known as the Agricultural Refinance Corporation.

(2) The Corporation shall be a body corporate with the name aforesaid, having perpetual succession and a common seal with power, subject to the provisions of this Act, to acquire, hold and dispose of properly, and to contract, and may by that name sue and be sued.

Section 3A. Change of name of 'Agricultural Refinance Corporation'

(1) On the commencement of the Agricultural Refinance Corporation (Amendment) Act, 1975, the Corporation established under 9 and known as the Agricultural Refinance Corporation shall be renamed as the Agricultural Refinance and Development Corporation.

(2) The change of name of Agricultural Refinance Corporation by sub- (1) shall not

(a) affect any right or obligation of that Corporation subsisting immediately before the commencement of the Agricultural Refinance Corporation (Amendment) Act, 1975;

(b) render defective any suit or other legal proceeding pending, immediately before such commencement, by or against the Corporation in its former name; and

(c) affect the institution, continuation or commencement of any suit or other legal proceeding which could have been instituted, continued or commenced, by or against that Corporation in its former name before such commencement.

Section 4. Offices and agencies

The Corporation shall establish its head office in Bombay and may, with the previous approval of the Reserve Bank, establish offices or agencies anywhere in India.

Section 5. Share capital and shareholders

(1) The authorised capital of the Corporation shall be twenty-five crores of rupees divided into twenty-five thousand fully paid-up shares of ten thousand rupees each of which five thousand shares of the total value of five crores of rupees shall be issued in the first instance, and the remaining shares may, with the sanction of the Central Government be issued from time to time by the Corporation as and when the Corporation may deem fit.

(2) Of the capital issued in the first instance and before such date as maybe notified by the Central Government in the official Gazette in this behalf

(a) the Reserve Bank shall subscribe for two thousand five hundred shares;

(b)1[central land development banks] and State co-operative banks may subscribe for one thousand five hundred shares;

(c) scheduled banks, the Life Insurance Corporation, insurance and investment companies and such other classes of financial institutions as may be notified by the Central Government in the official Gazette in this behalf may subscribe for one thousand shares.

(3) The allotment of shares to the institutions mentioned in clauses (b) and (c) of sub-section (2) shall be made by the Board in accordance with the regulations made in this behalf:

PROVIDED that no such institution shall be allotted more than ten per cent of the shares reserved for the class of institutions to which it belongs.

(4) If any shares referred to in clauses (b) and (c) of sub-section (2) remain unallotted, they shall be subscribed for by the Reserve Bank:

PROVIDED that the Reserve Bank may dispose of the shares subscribed for by it in pursuance of this sub-, to any institution mentioned in clauses (b) and (c) of sub-section (2), so however that

(i) the institutions referred to in the said clause (b) shall not together hold more than one thousand five hundred shares and the institutions referred to in the said clause (c) shall not together hold more than one thousand shares, and

(ii) no institution shall hold more than ten per cent of the shares reserved for the class of institutions to which it belongs.

(5) If and when the remaining shares2[referred to in sub-section (1)] or any part thereof are issued, the Reserve Bank shall, and the institutions referred to in clauses (b) and (c) of sub-section (2) may, subscribe for such shares in the same proportion as for the first issue and the provisions of sub-s (3) and (4), except clause (ii) of the proviso to sub-section (4), shall also apply to such shares.

(6) Shares of the Corporation shall not be transferable except (a) to the institutions specified in clauses (a), (b) and (c) of sub-section (2), and (b) in accordance with the regulations made in this behalf.

2[(5-A) Notwithstanding anything contained in sub-section (1), on the commencement of the Agricultural Refinance Corporation (Amendment) Act, 1975, the Reserve Bank may, with the previous approval of the Central Government, increase the authorised capital of the Corporation up to one hundred crores of rupees, such further capital also being divided into fully paid-up shares of ten thousand rupees each.

(5-AA) Notwithstanding anything contained in sub-section (5), out of the further capital issued pursuant to the increase of the authorised capital under sub-section (5-A), the Reserve Bank shall, and the institutions mentioned in clauses (b) and (c) of sub-section (2) may, subscribe for such shares in such manner and in such proportion, as may be prescribed.

(5-AB) The Reserve Bank shall not, at any time, hold less than fifty per cent of the further capital of the Corporation which is issued pursuant to the increase of the authorised capital under sub-section (5-A).

(5-AC) The allotment of shares, issued pursuant to the increase of the authorised capital under sub-section (5-A), shall be made by the Board in accordance with the regulations made in this behalf and if any such shares remain unallotted, they shall be subscribed for by the Reserve Bank:

PROVIDED that the Reserve Bank may dispose of such shares to any institution mentioned in clause (b) or clause (c) of sub-section (2):

PROVIDED FURTHER that no such disposal shall be made, if, as a result of such disposal, the shares held by the Reserve Bank in the further capital of the Corporation, issued pursuant to the increase of the authorised capital under sub-section (5-A), will fall below fifty per cent of such further capital.].

1. Substituted by Nos. S.O. 452(E), dated 28.08.1975 and S.O. 615(E), dated 24.10.1975,w.e.f. 15.11.1975.

2. Inserted by Act 45 of 1975, w.e.f. 15.11.1975.


Section 6. Guarantee by Central Government

Shares of the Corporation shall be guaranteed by the Central Government as to the repayment of the principal and the payment of a minimum annual dividend at such rate as may be fixed by the Central Government by notification in the official Gazette at the time of issuing the shares.

Section 7. Shares of Corporation to be deemed to be securities for certain purposes

Notwithstanding anything contained in the Act herein-after mentioned in this, the shares of the Corporation shall be deemed to be included among the securities enumerated in 20 of the Indian Trusts Act, 1882 (2 of 1882), and be also deemed to be approved securities for the purposes of the Insurance Act, 1938 (4 of 1938), and the1[Banking Regulation Act], 1949 (10 of 1949).

1. Substituted by Nos. S.O. 452(E), dated 28.08.1975 and S.O. 615(E), dated 24.10.1975, w.e.f. 15.11.1975.


Section 8. Register of shareholders

(1) The Corporation shall maintain at its head office a register of the shareholders and shall enter therein the following particulars so far as they may be available, namely:

(i) the names and addresses of the shareholders and a statement of the shares held by each shareholder, distinguishing each share by its denoting number;

(ii) the date on which each person is entered as a shareholder;

(iii) the date on which any person ceases to be a shareholder; and

(iv) such other particulars as may be prescribed.

(2) Notwithstanding anything contained in this Act or in any other law for the time being in force, no notice of any trust, express, implied or constructive, shall be entered on the register maintained under sub- (1) or be receivable by the Corporation.

Chapter III

Section 9. Management

(1) The general superintendence, direction and management of the affairs and business of the Corporation shall vest in a Board of directors which may exercise all such powers and do all such acts and things as may be exercised or done by the Corporation.

(2) The Board, in discharging its functions, shall act-on business principles with due regard to public interest.

Section 10. Board of directors

The Board of directors shall consist of the following namely:

(a) a Deputy Governor of the Reserve Bank nominated by that Bank, who shall be the Chairman of the Board;

(b) a director nominated by the Reserve Bank;

(c) three officers of the Central Government nominated by that Government;

(d) one director elected in the prescribed manner by such of the1[central land development banks] as are shareholders of the Corporation ;

(e) one director elected in the prescribed manner by such of the State co-operative banks as are shareholders of the Corporation;

(f) one director elected in the prescribed manner by the Life Insurance Corporation, scheduled banks, insurance and investment companies and other financial institutions, which are shareholders of the Corporation; and

(g) a managing director to be appointed by the Reserve Bank and, except in the case of the first appointment, after consultation with the Board.

PROVIDED that on the first constitution of the Board, the directors refer-red to in clauses (d), (e) and (f) shall be nominated by the Central Government and the directors so nominated shall, for the purposes of this Act, be deemed to be elected directors:

PROVIDED FURTHER that the directors so nominated shall hold office until the conclusion of the first annual general meeting of the Corporation.

1. Substituted by Act 45 of 1975, w.e.f 15.11.1975.