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THE INDUSTRIAL DEVELOPMENT BANK OF INDIA ACT, 1964

Title : THE INDUSTRIAL DEVELOPMENT BANK OF INDIA ACT, 1964

Year : 1964



(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 Industrial Development Bank of India.

(2) The Development Bank 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 property and to contract, and may, by that name sue or be sued.

(3) The head office of the Development Bank shall be at Bombay or at such other place as the 1*[Central Government] may, by notification in the Official Gazette, specify.

(4) Development Bank may establish offices, branches or agencies at any other place in or outside India.

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1. Substituted by Act 52 of 1975, sec. 4, for "Reserve Bank".

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(1) The authorised capital of the Development Bank shall be two thousand crores of rupees divided into one hundred and fifty crores fully paid up equity shares of rupees ten each and subject to the provisions of section 4E, fifty crores of fully paid-up redeemable preference shares of rupees ten each.

(2) The Development Bank may, from time to time, by a resolution in general meeting, increase the authorised capital to an amount not exceeding five thousand crores of rupees consisting of such number of equity shares and redeemable preference shares as it deems fit. ]

4A -1* Transfer of capital to Central Government

(1)The issued capital of the Development Bank which has been subscribed by the Reserve Bank as on the date immediately preceding the commencement of section 5of the Public Financial Institutions Laws (Amendment) Act, 1975 (hereinafter referred to as the "appointed day"), shall, on such commencement, stand transferred to, and vested in the Central Government.

4B -1* Payment of amount

The Reserve Bank shall be given by the Central Government, in cash, for the transfer to, and vesting in, the Central Government of the issued capital of the Development Bank which has been subscribed by the Reserve Bank, an amount equal to the face value of the said subscribed capital.

4C -3* Issued capital

(1) The issued capital of the Development Bank of seven hundred and fifty-three crores of rupees which stands fully vested in and subscribed by the Central Government immediately before the commencement of the Industrial Development Bank of India (Amendment) Act, 1995 shall, on such commencement, stand divided into seventy-five crores and thirty lakh equity shares of rupees ten each.

(2) The Board may, from time to time, increase the issued equity share capital of the Development Bank by allotment of shares to such persons and on such terms and conditions as the Board may determine:

Provided that no increase in the issued equity capital shall be made in such a manner that the Central Government holds at any time less than fifty-one per cent of the issued equity capital of the Development Bank. ]

4D - 3*Reduction of share capital

(1)The Development Bank may, by a resolution passed in a general meeting of the shareholders to, reduce its share capital in any way.

(2) Without prejudice to the generality of the foregoing power, the share capital may be reduced by:-

(a) Extinguishing or reducing the liability on any of its equity shares in respect of share capital not paid-up;

(b) Either with or without extinguishing or reducing liability on any of its equity shares, cancelling any paid-up share capital which is lost, or is unrepresented by available assets; or

(c) Either with or without extinguishing or reducing liability on any of its equity shares,-paying off any paid-up share capital which is in excess of the wants of the Development Bank.

(3) In any general meeting referred to in sub-section (1), the resolution for reduction of share capital shall be passed by shareholders entitled to vote, voting in person, or, where proxies are allowed by proxy, and the votes cast in favour of the resolution are not less than three times the number of the votes, if any, cast against the resolution by shareholders so entitled and voting. ]

4E - 3*Conversion of equity shares into redeemable preference shares

(1) The Central Government may, at any time after the commencement of the Industrial Development Bank of India (Amendment) Act, 1995 and by notification in the Official Gazette, convert such number of equity shares held by it not exceeding fifty crores as it may decide into redeemable preference shares.

(2) The redeemable preference shares referred to in sub-section (1) shall-

(a) Carry such fixed rate of dividend as the Central Government may specify at the time of such conversion, and

(b) Neither be transferable nor carry any voting rights.

(3) The redeemable preference shares referred to in sub-section (1) shall be redeemable by the Development Bank within three years from the date of such conversion in such installments and in such manner as the Board may determine.

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1. Sections 4A and 4B Substituted by Act 52 of 1975, sec. 5, for section 4.

2 . Substituted by Act 5 of 1995, sec. 3, for section 4 (w.r.e.f. 12-10-1994).

3. Inserted by Act 5 of 1995, sec. 5 (w.r.e.f. 12-10-1994).

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Last updated on July, 2016

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