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REHABILITATION FINANCE ADMINISTRATION ACT

Ministry of Law and Justice

Act nº 12 of 1948


  • Act nº 12 of 1948

Preamble

THE REHABILITATION FINANCE ADMINISTRATION ACT, 1948

[Act, No.12 of 1948]

[23rd March, 1948]

PREAMBLE

An Act to establish the Rehabilitation Finance Administration.

WHEREAS it is expedient to establish a Rehabilitation Finance Administration for the purpose of giving financial assistance on reasonable terms to displaced persons to enable them to settle in business or industry;

Section 1. Short title, extent and commencement

(1) This Act may be called The Rehabilitation Finance Administration Act, 1948.

1[(2) It extends to the whole of India except the State of Jammu and Kashmir.]

(3) It shall come into force on such date2as the Central Government may, by notification in the Official Gazette, appoint in this behalf.

1. Substituted for the former sub-section (2) by the Rehabilitation Finance Administration (Amdt.) Act, 1950 (1 of 1950), Section 2 (18-2-1950).

2. The Act came into force on 1-6-1948


Section 2. Definitions

In this Act, unless there is anything repugnant in the subject or context,-

(a) "Act" means the Rehabilitation Finance Administration Act, 1948;

(b) "Administration" means the Rehabilitation Finance Administration constituted under this Act;

(c) "borrower" means an individual, company, association or body of individuals, whether incorporated or not, to whom a loan has been advanced under this Act;

(d) "displaced person" means-

(i) a person who, being displaced from any area1[now forming part of Pakistan] on account of civil disturbances or fear of such disturbances, has settled and is engaged or intends to engage in any business or industry in India, or

(ii) a person in India who, having had his business, industry or property, wholly or partially1[in any area now forming part of Pakistan], has lost, wholly or partially, such business, industry, or property on account of civil disturbances or the fear of such disturbances, and who is engaged, or intends to engage in any business or industry in India;

2[(e) "loan" means a sum of money advanced by the Administration-

(i) to a displaced person for the purpose of any business or industry in which he is engaged or intends to engage, himself, or

(ii) in respect of any business or industry, a substantial portion of which is owned by displaced persons; and]

(f) "prescribed" means prescribed by rules made under section 23 or regulations made under section 24.

1. Substituted for "outside India" by the Rehabilitation Finance Administration (Amdt.) Act, 1950 (1 of1950), Section 3 (18-2-1950).

2. Substituted for the original clause by the Rehabilitation Finance Administration (Amdt.) Act, 1950 (1 of1950), Section 3 (18-2-1950).


Section 3. Establishment and incorporation

(1) The Central Government shall constitute a Corporation called the Rehabilitation Finance Administration for giving financial assistance on reasonable terms to displaced persons to enable them to settle in business and industry1[or to any business or industry, a substantial portion of which is owned by displaced persons].

(2) The Corporation shall be a body corporate by the name of the Rehabilitation, Finance Administration having perpetual succession and a common seal, with power, subject to the provisions of this Act, to acquire, hold and transfer property, both movable and immovable, and shall by the said name sue and be sued.

(3) The administration shall have its head office at Delhi and may, with the previous approval of the Central Government, open branches at such places in India as it may consider necessary to discharge effectively its functions under this Act.

1. Added by the Rehabilitation Finance Administration (Amdt.) Act, 1950 (1 of 1950), Section 4 (18-2- 1950).


Section 4. Constitution of the Administration

(1) The Administration shall consist of the following members, namely :-

(a) a Chairman to be appointed by the Central Government who shall be called the Chief Adminis­trator;

(b)1[four] officials, appointed by the Central Government; and

(c)1[four] non-officials nominated by the Central Government.

(2) No act done by the Administration shall be called in question on the ground merely of the existence of any vacancy or any defect in the constitution of the Administration.

1. Substituted for the word "three" by the Rehabilitation Finance Administration (Amdt.) Act, 1950 (1 of 1950), Section 5 (18-2-1950).


Section 5. Advisory Board

(1) The Central Government shall constitute an Advisory Board to advise the Administration on matters of policy and may, where necessary, constitute a Regional Committee to advice each branch of the Administration.

(2) The Advisory Board shall consist of such members, not exceeding fifteen in number, as maybe nominated by the Central Government.

Section 6. Terms of office of the members of the Administration and the Advisory Board

(1) A member appointed under clauses (a) and (b) of sub-section (1) of section 4 shall hold office during the pleasure of the Central Government.

(2) A member nominated under clause (c) of sub-section (1) of section 4 or sub-section (2) of section 5 shall hold office for a term of two years from the date of his nomination and shall be eligible for renomination.

(3) A nominated member may resign his membership by writing under his hand addressed to theCentral Government and he shall thereupon cease to be a member.

(4) A casual vacancy created by resignation under sub-section (3) or by any other reason shall be filled by fresh nomination and the person nominated to fill the vacancy shall hold office only for the remainder of the term for which the member whose place he takes was nominated.

Section 7. Disclosure of interest

(1) No member of the Administration shall have any interest, direct or indirect, in any business, industry or concern to which any assistance under section 12 has been given or is to be given and if any such member acquires such interest at any time during the continuance of such assistance, he shall immediately disclose it to the Administration and shall either resign his membership or dispose of his interest in such manner and within such time as he may be directed by it.

(2) Any member of the Advisory Board who has any interest, director indirect, in any business, industry or concern to which any assistance under section 12 has been given or is to be given or acquires such interest at any time during the continuance of such assistance shall immediately disclose it to the Administration and shall not participate in the proceedings of the Advisory Board relating to such assistance.

Section 8. Removal from membership

Notwithstanding anything contained in section 6, the Central Government may, for any reason which may appear to it to be sufficient, remove any member at anytime from the Administration or the Advisory Board.

Section 9. The Chief Administrator

The Chief Administrator shall be a whole time servant of the Administration and shall receive such salaries and allowances and shall be subject to such terms and conditions as may be determined by the Central Government

Section 10. Staff

The Administration may, in the manner prescribed1[* * *]-

(a) appoint a Deputy Chief Administrator and such other officers and servants as may be required to enable it to carry out the functions under this Act;

(b) fix the salary and allowances or other conditions of service of the Deputy Chief Administrator, other officers and servants;

(c) fix the remuneration and allowances payable to the members of the Administration and of the Advisory Board:

2[Provided that the appointment and the fixation of the salary, allowances and other conditions of service of the Deputy Chief Administrator and such other officers as may be prescribed by the Central Government, shall be subject to the previous sanction of that Government.]

1. The words "and with the prior sanction of the Central Government" were omitted by the Rehabilitation Finance Administration (Amdt.) Act, 1950 (1 of 1950), Section 6 (18-2-1950).

2. Added, by the Rehabilitation Finance Administration (Amdt.) Act, 1950 (1 of 1950), Section 6 (18-2-1950).


Section 11. Funds of the Administration

1[(1) The Central Government may, from time to time, advance money to the Administration for its business, the aggregate amount of which,-

(a) for the purpose of enabling the Administration to advance loans, shall not, save as hereinafter provided, exceed twelve crores and fifty lakhs of rupees; and

(b) for the purpose of enabling the Administration to meet any liability which it may incur in guaranteeing losses in respect of loans advanced by scheduled Banks, shall not exceed two crores of rupees:

Provided that if, after the lapse of such period from the commencement of this Act as the Central Government may think fit to fix in this behalf, any sum of money earmarked for the purpose specified in clause (b) is found not to have been actually advanced for that purpose and is not, in the opinion of the Central Government, likely to be required for the said purpose, the Central Government may utilize the money for making advances from time to time to the Administration for the purposes specified in clause (a), and when any such advance is made, the limit specified in clause (a) shall be deemed to have been correspondingly increased.]

(2)2[Subject to any regulations that may be made in this behalf, all moneys belonging to the Administration which are not immediately required by the Administration for any purpose] shall be deposited in the Reserve Bank of India or any agents thereof or invested in such securities as may be approved by the Central Government.

(3) The Administration shall pay interest on the money so advanced at the rate of 3 per cent per annum to the Central Government.

1. Substituted for the former sub-section (1) by the Rehabilitation Finance Administration (Amdt.) Act, 1953 (37 of 1953), Section 2 (10-12-1953).

2. Substituted for the words "All moneys belonging to the Administration", by the Rehabilitation Finance Administration (Amdt.) Act, 1950 (1 of 1950), Section 7 (18-2-1950).


Section 12. Business of the Administration

1[12. Business of the Administration

The Administration may-

(a) subject to the provisions of section 13, advance loans;

(b) guarantee, on such terms and conditions as may be agreed upon, losses which a scheduled bank may suffer in respect of any loan advanced by it and approved by the Administration :

Provided that the total amount which may be guaranteed in respect of any scheduled bank and the terms and conditions on which such guarantee may be given shall be subject to the prior approval of the Central Government:

Provided further that the maximum liability of the Administration under such guarantee shall not exceed the amount for the time being available under clause (b) of sub-section (1) of section 11;

do all such acts and things as may be incidental to or consequential upon the performance of its functions under this Act including the running of the Administration.]

1. Substituted for the original section by the Rehabilitation Finance Administration (Amdt.) Act, 1953 (37 of 1953), Section 3 (10-12-1953).


Section 13. Loans

(1) The Central Government may prescribe the limits as to the amounts within which loans may be advanced by the Administration.

(2) For the purpose of advancing any loan under sub-section (1), the Administration may call for any report either through its own staff, or through the District Officer of the district in which the borrower resides or carries on business, or through any State1[* *] Government, or through any Bank of any other appropriate agency.

(3) The Administration shall charge interest from the borrower at such rate not exceeding 6 per cent. per annum as may be specified by it.

(4) The period of the loan shall not exceed2[fifteen] years.

(5) The loan may be advanced either for fixed capital or working capital or for both.

The assets created from the loan shall, notwithstanding any law or usage to the contrary, be deemed to be mortgaged to the Administration for the repayment of the loan together with the interest thereon and the amount of the loan and the interest thereon shall be the first charge on such assets,

(6) The Administration may also take such further security for any loan as it may consider neces­sary.

1. The words "or a State" were omitted by the Repealing and Amending Act, 1957 (36 of 1957), Section 3 and Schedule II (17-9-1957).

2. Substituted for the word ten by the Rehabilitation Finance Administration (Amdt.) Act, 1953 (36 of 1953), Section 4 (10-12-1953).


Section 14. Power to call for repayment before agreed period

Notwithstanding any agreement to the contrary, the Administration may, by notice, require any, borrower forthwith to repay in full with interest thereon any loan borrowed from it,

(a) if it appears to the Administration that false or misleading information in any material particular was given by the borrower for obtaining the loan or while furnishing any information under section 17; or

(b) if the borrower has failed to comply with the terms of the contract which the Administration in the matter of the loan; or

(c) if there is a reasonable apprehension that the borrower is unable to pay his debts or that insolvency proceedings or proceedings for liquidation may be commenced against him; or

(d) if for any other reason it is necessary in the opinion of the Administration to protect the interests of the Administration.