 bill no 61 of 1876 the banking and public financial institutions laws (amendment) bill, 1976 a billfurther to amend the industrial finance corporation act, 1948, the state bank pi india act, 1955, the industrial development bank of india 'i act, l~ and the rte;gional ru'ral banks act, 1976 be it enacted by parliament in the twenty-seventh y~ar of the republic of india as follows:- chapter i preliminarys 11• this act may be called the banking and public financial insbtu-short title tions laws (amendment) act, 1976 2 any reference in sections 3(i), 4(ii), 5 (i) and 6(i) of this act to, constructhe chairman or, as the case may be, vice-chairman or managing director tion of  shall be construed as including a reference to the person holding office references 10· a8 such at the commencement o,f this act  chapter iit·  am!:ndments to tife industrial fmance corporation act, 19483 in the industrial finance corporation act, 1948,-(i) in section loa, after suh-section (2), the following sub-section shall be inserted namely:--amendment of act 15 of 1948 • , "(214:) notwithstanding anything contained in sub-section  (2); the central gov«l\ment shall have the right to· tenn1nate '  cne term of office of the chairman at any time before the expiry of the term specified in sulb-section (z)by giving him notice of not less than three months in writing or three months' salary and allowances in lieu of such notice; and the chairman shall also have the right to relinquish his office at any s time before the expiry of the tenn specified in sub-section (2) by giving to the central government notice of not less than three months in writing"; (ii) in section 13, to sub-section (1) the following proviso shall be added namely:-10 "provided that no person shall be removed from his oftice, under this sub-section, unleo:;s he has been given an opportunity of showing cause against his rem'lval"  chapter iii amendments to the state bank of india act, 19554 in the state bank of india act, 1955,-(i) in section 19, in sub-section (1) ,-amendmentof aet23 of 18u (a) in clause (a), the words "and after cqt1sideration, of the recommendations made by the central board in that behalf" shall be omitted; 20 (b) in clause (b), for the words "by the central board with the approval of the central government", the words "by the central government in consultation with the reserve bank" shall be substituted; (if) in section 20-(a) in sub-section (1), for the words "the chairman and the vice-chairman", the words ''the chairman, vice-chairman and each managing director" shall be substituted; (b) after sub-section (1), the following sub-section shall be inserted, namely: _ 30 (" "(la) notwithstanding anything contained in sub--section (1), the central government shall ha"e the right to terminate the term of offtce of the chairman, viceh:hairman or a managing director, as the case may be, at any time before the expiry of the tenn fixed under sub-section (1) by 3s  giving him notice of not less than three months in writing or three months' salary and allowances in lieu of such notice: and the chainnan, vice-chaii1jlan or a managing director, a the case may be, shall also have the rjght to refinquish his oftlce at any time before the expiry of the term s~ fixed 40 by giving to the central government notice of not less than three months in writing"; (e) sub-section (z) shall be omitted; (tit) in section 23, in clause (b), for the word8 "chairman and tee-ebairman"; the words "ehairman, vi~ an a man'iid, 5 cunctor" ihall be iumtituted; (it» in section 24,-(a) in sub-section (1), for the words "the chairman or the vice-chairman", the words "the chairman, vice-chairman or - managing director" shall be substituted; 5 (b) sub-section (2) shjll be omitted; (c) in sub section (6), the words, brackets and figure "or sub-section (2)" shall be omitted;  (v) in section 25, for sub-section (1), the following sub-section shall be substituted, namely:-10 "(1) if the chairman, vice-chainnan or a managing director is rendered incapable of dischargling his duties by reajson of infirmity or otherwise or is absent on leave or otherwise in circumstances not involving the vacation of his oftice, the central government may, in consultation with the reserve bank, 15 , appoint another person to officiate in the vacancy"; (vi) in section 27, in sub-section (2),-01 ••• , ••• (a) for the words "as may be detemlined by the central ":'" , board with the approval of the central government:", the words <,: • "as may be detennined by the central government" shall be 20 substituted; (b) the proviso shall be omitted; (vii) in section 28, in sub-section (2) ,-(a) for the words "as may be determined by the central board with the approval of the central government:", the wordl "as may be determined by the central government" shall be substituted; (b) the proviso shall be omitted; ('viii) in section 29, in sub-section (2) ,-(p) for the words "as may be determined by the central board with the approval of the central government:", the worda - "as may be determined by the central government" shall be substituted; (b) the proviso shall be omitted  chapter iv 35 amendments to th& industrial development bank of india ac:r, 19645 in the industrial development bank of india act, 1964 in section amend   6,-mental act 1801 (i) after sub-section (2), the following sub-section shall be 111m inserted, namely:-"(2a) notwiths~ding anything contained in sub-section (1), the central government shall have the right to terminate the term of office of the chairman or managing direc-'tor, as the case may be, at any time before the expiry of the ~ ,~- ~temi specified under sub-8ecti~ (2) by giving him notice of not less than three months in writing or three months'alary and allowances in lieu of such notice; and the chairman or managing ~'~i as ,the case may be, shall also have the right to relinq~ his o1ilce at any tin;le before the expiry of the term) ~cified unde!r sub-section (2) by giving to the central gof,t;rjlment notice of not less than three months in writing"; 5 (ii) after sub-section (3), the following sub-sectiqll shall be inserted, namely:-"(3a) the central government may, at any time, remove the chairman or the managing director, as the case may be from office: ' 10 provided that no person" shall be removed from his office, under this sub·section ~ril~s he has' beeh given an opportunity of showing cause against his removal ' ,  chapter v amendments to the regional rural banks act, 1976is 6 in the regiqllal rural banks act, 1976, in section 11,-(i) after sub-section (1), the following sub-section shall be inserted, namely:-amendment of act 21 ot 19'76 "(la) notwithstanding anything contained in sub-section (1), the central government shall have the right to 20 terminate the term of office of the chairman at any time before the expiry of the period specified under sub-section (2) by giving him notice of not less than three months in writing or three months' salary and allowances in lieu of such ~otice; and the chairman shall also have the right ~ relinquish his office at 25 any time before the expiry of the period so specified by giving to the central government notice of not less than three months in writing"; (ii) for sub-section (4), the following sub-section shall be sub-,·"lututed, namely:-30 "() 'the central government may,at any time, remove the chairman from office: provided that no person shall be removed fr~ his office, under this subsection, unless he has been given, an opportunity of showing cause against his fen10val" 3s  statement of objects and reasonsit ie, proposed to· bring about a measure ot uniformity in the procedure for appointment, fixation of the terms and conditions of service  including removal from, or termination of, service of the chairman, vice-chairman, and managing directors of the state bank of india, chairnien of the regional rural banks, chairman of the industrial finance corporation of' india and chairman and managing director 'of the indwl'" trial development bank of india i~ the relevant enactments regulating the said institutions thes~ executives will also have the option to relinquish office by giving the central goverllment a notice of three months it is r,jroposed to make the amendments' applicable to the existing incumbents of these offices also 2· opportunity has also been taken to streamline some other provisions of these statutes new :delhi; pranab mukherjee the 21st may, 1976 (15 01' 1948) - - - - - 13 (1) the central government may after consultation with the development bank at any time remove the chairman from oftlce - - - - - removal of director from ofllce extracts from the state bank of india act, 1955 (23 01' 1955) - - - - - 19 (1) the central board shall consist of the following, namely:-composition of the central board (a) a chairman and a vice-chairman to be appointed by the central government in consultation with the reserve bank and after consideration, of the recommendations mac\e by the cedval board in that behalf; (b) not more than two managing directors, if any, appointed by the central board with the approval of the central government; - - - - - zoo (1) the chairman and the vice-chairman shall hold office for such term, not exceeding five years, as the central government may fix when appointing them and shall be eligible for reappointment termot office of chairman, managinl director, etc vacation ofo1dce ofdirectors, etc (2' a managing director shall hold office for such term, not exceeding five years as the central board may fix when appointing him, and shall be eligible for reappointment - - - - - 23 if a director of the central board or a member of a local board ')r a local committee-- - - - (b) resigns his office by giving notice in writing under his hanrl, in the case of the chairman and vice-chairman, to the central government and in the case of other directors or members of local boards or committees, to the central board, and the resignation is accepted; or - - - - - 24 (1) the central government may, after consulting the reserve bank, remove from office the chairman or the vice-chairman removal from oftlce of directors, etc (2) the central board may, with the approval of the central government, remove from office a managing director - - - - - (6) no person shall be removed from his office under sub-section (1) or sub-section (2) or sub-section' (3) unless he has been given an opportunity of showing cause against his removal 25 (1) if the chairman, vice-chairman or a managing director is c8iual rendered incapable of discharging his duties by reason of infirmity or vacancie' otherwise or is absent on leave or otherwise in circumstances not involving the vacation of his office, the central government may, in the case of the chairman or vice-chairman, in consultation with the reserve bank and after considering the recommendations of the central board, and the central board may, in the case of a managing director, with the approval of the central government, appoint another person to ofbciate in the vacancy - - - -  ~ (1) -                  -                                                                     -                                                  - 1 (2) the chairman shall receive such salary, fees, allowances and powers and remunera-tion ot chairman ~rquisites as may be determined by the central board with the &pproval of the central government:    provided that in respect of the first chairman, the central govern· ment may determine his salary, fees, allowances and perquisites 28 (1)                                                                                                                  -                                                                 - powe1'8 and remunera-tion of vice-chairman    (2) the vice-chairman shall receive such salary, fees, allowances and perquisites as may be determined by the central board with the approval of the central government:    provided that in respect of the first vice-chairman, the central gov-ernment may cietermine his salary, fees, allowances, and perquisites                                                                                                                                                                                                                                                                                                                                                                                                                               - 29 (1) -                      -                                   -                                                -                                                              powers and remunera-tion ot managing director    (2) a managing director shall receive such salary and allowances as may be determined by the central board with the approval of the central government:   provided that in respect of the first managing director or directors, the central government may determine the salary and allowances pay-able to him or them           -                      -                                  -                                             -                                                         - chairman         extract from the recional rural banks act, 1976                           (21 of 1976)          -                     -                               -                                          -                                                     -   11 (1) -                                                                                                 -                                                          (4) the chairman shall hold office during the ple,ure oi the central government          -                     -                               -                                          -                                                     -  billfurther toamemi the industrial finance corporation act, 1948, the ,state bank of india act, 1955, the industrial de\'eiopment batik of india act, 1964, and the regional rural banks act; lit'1v - (shrl pramb kumar mukherjee, mh",ibter of revenue ani;! bankinp) ~  i 