 tlte state bank of india (amendment) bill~ 1955 (as introduced in lok sabba) the state bank of india (amendment) bill, 195j [as introduced in lox sabha] itbill , ~! , to amend the state bank of india act, 1955 'j! ,'-7-, i r  be it enac~d by parliament in the sixth year qf ~ republic of india as follows: - 1 this act may be called the state bank of india (amendment) short title act, 1955 , 2 in sub-section (1) of section 5 of the state bank of india act, amen~nt 1955 (hereinafter referred to as the principal act), for the words and ~~ a:~lo; figure "transferred to it by paragraph 2 of the first schedule" the 195'· worns and figure "transferred to and vested in it under section 6" shall be substituted 10 3 in section 6 of the principal act, for sub-section (3), the fonow- amen~ment ing sub-section shall be substituted, namely: """7 ~c:e:;~f 6, is "(3) unless otherwise expressly provided by or under this i9ss· act, all contracts, deeds, bonds, agreements, powers of attorney, grants of legal representation and other instruments of whatever nature subsisting or having effect immediately before the appointed day and to which the imperial bank is a party or which are in favour of the imperial bank shall be of as full force and effect against or in favour of the state bank, as the case may be and may be enforced as fully and effectually as if instead of the imperial bank the state bank had been a party thereto or as if they had been issued in favour of the state bank" amcndment 4 in sub-section (3) of section 16 of the principal act, after the ~~ a:~~oof words "in existence" the words "in india" shall ·be inserted 1955· substitution 5 for section 51 of the principal act, the following section shall of new ~od be substituted namely:-for secbon 51 - in act 23 of 1955· requirements of foicign 1a" to be com-~ued with 10 certain c:aael "51 if, according to the la~s of any country outside india 3 the provisions of this act by themselves are not etjective to transfer to and vest in the state bank any asset or liability which forms part of the undertaking of the imperial bank and which is situate in that country, the  imperial bank shall take all such steps as may be requir- 10 ed by the law~ of tha~ country for the purpose of etject~~ ot 'perfecting such trartsfer and' vesting, and in connection therewith the imperial bank may realise any asset and discharge any liability and transfer the net proceeds the'reof to the state bank" " or"   '  ''54 the' imperial bank of india act, 1920, shall be amended in the manner directed in the fifth schedule  insertion of 6 after section 53 of the principal act, the following sections new sectiodi shall be inserted, namely:-545556  8n4 57 in noi'o xlvii of 1920• amendment o fact xlvii of 1920: no proc:ee-~ t~ lie ul india apidlt imperial bank after appointed day 55 on and from the appointed day, no person shall make any 20 claim or demand or take any proceeding in india against the imperial bfank or a director, officer or otber employ~ thereof in his capacity as such direc~or, officer or employee except i~ so far as may be necessary for enforcing! ~e provisions of this act or except in so far as it relates to 2s any offence committed by any such director, officer or  employee references to the imperial 56 on and from the appointed day, any reference to the imperial bank or to the bank of bengal, the bank of madras or the bank of bombay in any law (other than 30 this act or the imperial bank of india act, ·1920) or in xlvii of bank the bank of bc:dp etc •• in other lawi dinolution of imperial bank etc any contract or other instrument shall, except as other-1920 wise provided in any general or special order made by the  , central government, be deemed to be a reference to the state bank 35 57 (1) on such day as,the central government may, by notification in the official gazette, specify in this behalf, the imperial bank shall stand dissolved, and the imperial bank of india act, 1920, shall stand repealed xlvii of 1920 (2) on the day specified in the notification under sub-section (1), the state bank shall pay to the reserve bank a sum of ten lakhs of rupees" (3) if, on the day specified in the notification under su1rsection , (1) the imperilll bank has in its possession or custody any assets created on or after the appointed day, such assets shall be' disposed of in accordimce with the directions issued by the' central government in this behalf" 7 after the fourth schedule to the principal act" the following insertion of lei) schedule shall be added: -r:a~c:;~t 1955  "the fifth schedule [see section 54] amendment to the imperial bank of india act, 1920sectio7t 2-(a) omit clauses (c) (d), (1), (g) and (ii) (b) for clauses w (k), (1) and (m), substitute-15 "(j) 'state bank' means the state bank of india constituted under the state bank of india act, 1955" 20 section 3-(a) in sub·section (2), for the words "every persdn who, immediately before the appointed day, was registered as a shareholder or as a holder of stock in any of the presidency banks, together with such other persons as may from time to time become shareholders in the bank in accordance with the provisions of this act shall, as long as they are shareholders in the bank,", substitute the following, namely: -"the persons who for the time being are holding office as chairman, vice-chair--man and managing director of the state bank shall" (i» for sulhjection (3), substitute-"(3) the capital, of the bank shall consist of ten lakhs of rupees which shall be paid to the bank by the reserve bank of india on the 1st day of july, 1955/' (c) omit sub-section (4) omit sections 4, 5, 6, 7, 13, 13a, 14, 15, 16, 17, 18, 19 and 20 for section 23 substitute the following:-"23, the bank shall have its head office in bombay" head office of the bank  i'orsection 24, substitute-general superintendence of affairs and business of bank "24 (1) the general superintendence of the affairs and business 'of the bank shall be entrusted to the chairman for the time being of the state bank who may exercise all powers and do all such acts and things 5 as may be exercised or done by the bank or which, immediately before the 1st day of july, 1955, were required or permitted to be exercised or done by the central board or by any local board of the bank, and accordingly references to the central board, if any, 10 in this act or in any regulations made thereunder shall be construed as references to the chairman for the time being of the state bank (2) any of the powers or functions conferred on the chairman of the state bank by sub-section (1) may be is exercised or performed by any such officer or other employee of the state bank as may be authorised by the chairman by general or special order" omit sections 25, 26, 27, 28 and 29 section 31-in sub-section (2), omit clauses (a) to (j) 20 section 32-0mit sub-section (2) after section 32, insert the following:-persons authorised to act on behajfof bank "32a (1) every person (other than the managing director and j)eputy managing director) who, immediately before the 1st day of july, 1955 had authority confer- zs red by any notification issued under regulation 51 of schedule ii or under bye-law 26 made under section 31 or under any power of attorney granted by the bank to sign any instrument or perform or do any act or thing for and on behalf of the bank, shall, on so and from the aforesaid date, continue to have the same authority, and shall not, by reason of anything contained in the state bank of india act, 1955, 23 of 1955 be deemed to have vacated any office or employment held by him ,in the bank immediately before the 3s aforesaid date in connection with which such authority, had been conferred on him, but the bank may at any time revoke any such authority (2) without prejudice to any other provision contained in this act, the bank may, by power of attorney, empower any person for and on behalf of the bank to execute any instrument or to exercise any right or to perform or do any act or thing which may be executed, exercised, performed or done by the bank" in schedule 11,-(a) omit regulations 1 to 48; (b) for regulation 49, substitute-10 i, 5 "49 the common seal of the bank shall not be affixed commod to any instrument except in the presence of the seal chairman or the vice-chairman or a managing director of the state bank, who shall sign his name to the instrument in token of his presence, and such signing shall be independent of the !igning of any person who may sign the instrument as a witness, and unless so signed, suah instrument shall be of no validity"; (c) in regulation 51, for the words "the managing director and deputy managing director, the secretaries and such other employees", substitute the words "such employees", and omit the words "and to execute proxies to vote at· meetings on behalf of shareholders from whom the bank holds general powers-of-attorney" occurring at the end; (d) to regulation 52 add the following:-"provided that nothing conta:ned in this regulation shall have effect in relation to the holding of any diice by, or the employment of any such person m the state bank": (e) in regulation 54(2) om:t "signed by a majority of the directors"; (f) omit regulations 55 56 57 58 60(2) 60a 61 62 63 and 64; {g) for regulation 65 substitute the following :--"65 a notice may be served on the bank by leaving it seryice of at or sending it by post to the head office of the ~~~~~ on bank" 8 the amendments made by sections 2 to 7 shall be 40 always to have been made in the principal act deemed amendmenr detm'!d always to have been made in the pdq  of 19s5 | 9        | the       | state    ||-----------|-----------|----------|| 1955,     |           |          || hereby    | repealed |          || dpal act  |         |          || is        |           |          || repeal    | of        |          || ordinance |           |          || "         | or        | t9ss    | statement of objects and reasonsthe scheme of the state bank of india a~t, 1955 (23 of 1955) envisaged the state bank of india coming into existence and the imperial bank of india going out of existence simultaneously on the "appointed day" (being the day notified in this behalf by the central government) and provided for the automate transfer of all the assets and liabilities of the undertaking of the imperial bank of india from that institution to the state bank of india while there was no difficulty about such transfer so far as the assets and liabilities of the imperial bank situated in india were concerned, government were advised that it was doubtful whether such an automatic transfer of assets and liabilities made by ~virtue of an indian law from one corporate body to another would be recognised and given effect to in foreign countries in respect of the assets and liabilities of the foreign branches of the imperial bank of india in the light of the advice obtained o!l this legal issue from counsel in the different foreign countries concerned, it was decided that it would be advisable to amend the scheme of the act and to provide for the continued existence of the knperial bank of india as a corporate entity b~y::>nd the "appointed d3y" to enable it to make over its busines§ in its foreign bran~h~s by execution of documentary transfers, if necessary, to the corresponding branches of the state bank of india t·') be opened there it was therefore necessary to amend the state bank of india act, 1955, alld as this had to be done prior to the 1st of j~ly, 1955, which had been notified as the "appointed day" under the state bank of india act, the state bank of india (amendment) ordinance, 1955 (4 of 1955)·was promulgated on the 23rd june, 1955 the present bill seeks to convert that ordinance into an act a c guha new delhi; the 231'd july, 1955  annexure extracts from the state bank of !noh act, 1955 (no 23 of 1955) - - - 5 (1) the issued capital of the state bank shall, on the appointed ~~~~j dey, be five crores, sixty two lakhs and fifty thousand rupees divided into five lakhs, sixty two thousand and five hundred shares, all of which shall, on th~ appointed day, stand allotted to the reserve bank in lieu of the shares of the imperial bank transferred to it by paragraph 2 of the first schedjlle  - - -  chapter iiitransfer of undertaking of the imperial bank to state bank 6 ( 1)  transfer of assets and  - - - liabilities of the imperial (3) without prejudice to the provisions contained in section 7, ~=~ all contracts and other instruments of whatever nature, subsisting or having efect immedia'tely before the appointed day and to which the imperial bank is a party, shall be of as full force and effect against or in favour of the state bank, as the case may be, and may be enforced as fully and effectually as if instead of the imperial bank the state bank had been a party thereto  - - -  chapter v managemen'r16 (1) offices, branchealand agencies  - - - (3) the state bank shall m~intain as its branches or agencies all branclles or agencies of the imperial bank which were in existence immediately before the appointed day, and no such branch may be closed without the previous approval of the reserve bank  - - - : 51 {l) on the appointed day, the imperial bank shall be dis- dilaolution $olved and thereafter no person shall make any claim or demand ~ ~~ or take any proceeding against that bank or a director, officer or employee thereof in hi$ capacity as such director, officer or employee except in so far as may be necessary for enforcing the provisions of this act or except in so far as it relates to any offence committed by any such director, officer or other empl()yee (2) on the appointed day, the imperial bank of india act, 1920, xlvii of shall stand repealed ' 1920 (3) without prejudice to the other provisions contained in this' act and notwithstanding the repeal of the imperial bank of india ~~i1 vc act, 1920, any reference to the imperial bank or to the bank of bengal; the bank of madras or the 'bank of bombay in any law, notification or in any contract or other instrument shall, on and from the appointed day, be deemed to be a reference to the state bank  - - - - extracts from the imperial bank of india act, 1920 (xlvii of 1920) - -  - - - chapter i &tabh·1"",t oftbe lmperial bank establishment and incorporation of the imperial bank of india 3 (1) - - - - (2) every person who, immediately before the ap60inted day, was registered as a shareholder or as a holder of stock in any of the presidency banks, together with such other persons as may from time to time become shareholders in the bank in accordance with the provisions of this act, shall, as long as they are shareholders in the bank, constitute a body corporate with perpetual succession and a common seal under the name of the imperial bank of india and shall sue and be sued in that name - - (3) subject to the provisions of this act, the capital of the bank shall consist of one hundred and twelve millions and five hundred thousand rupees divided into shares of five hundred rupees each (4) the liability of the shareholders of the bank sha be limited to the amount dot fully paid up on their shares - - - -  chapter v managementti the- bank shall have local head oftlces in calcutta, madras abd bombl'y, and at such other places in lddia or pakistan' or id burma as the bank may determine - - 14 the lenerai superintendence of the aftairs and business: of central the bank shall be entrusted to a central board of directors herein- bos!'d after in this act referred to as the "central board", who may exercise all powers and do all such acts and things as may be exercised or done by the bank and are not by this act expressly directed or required to be done by the bank in general meeting  - - - - schedule ii - - - -  regulations of the bank , (see sections 22) - • the seals41 (1) the common seal of the bank shall be affixed to any clmmon instrument except in the presence of at least three directors includ- scal ing the managing director or deputy managing director, who shall sign their names to the instrument in token of their presence, and such signing shall be independent of the signing of any person who may sign the instrument as a witness unless so signed as aforesaid such instrument shall be of no validity ' (2) the bank shall have for use by the local boards at calcutta, madras· and aombay, and may have for the use of other local boards established under this act, official seals which shall be facsimiles of the common seal of the bank with the addition of the name of the local head office where it is to be used (3) the official seal shall be affixed to the certificates issued in respect of any shares entered in the branch registers kept at those places and may be used for such other purposes as may be prescribed (4) an instrument to which an official seal is duly affixed shall bind the bank as if it had been sealed with the common seal of the bank (5) an official seal shall not be affixed to any instrument except in the presence of at least two members of the local board and the secretary or deputy secretary who shall sign their names to the instrument in token of their presence and such signing shall be independent of the signing of any person who may sign the instrument as a witness unless so signed as aforesaid such instrument shall be of no validity  - - - - 51 the managing director and deputy managing director, the account •• secretaries and such other employees of the bank as the central c:n-:d board may authorise in this behalf by notification in the official of bank by gazette are hereby severally empowered, for and on behalf of the b:°~igne~ dank, te endorse aad transfer pl"oldissory notes, stock-receipts, sjdckdebmrt~ shares, securities and doeuments of title to goods, standing in -the name of or held by the bank, and to draw, accept and endorse bills of exchange, bank-postbills and letters of credit, in the current and authorised 'business of the bank, to sign all other accounts, receipts and documents connected with such business and to execute proxies to vote at meetings on behalf of shareholders from whom the bank holds general powers of attorney otbcen for-52 no managing director, secretary, inspector, manager, or = i': accountant in the service of the bank, and, without the previous other sanction of the board, no khazanchi cashier or shroff in the service ~=:~ of the bank and no agent, at any branch or agency of the bank, shall engage in any other banking or commercial business, either , em his own account or as agent for any other pe1"8on 01" persons, or siren act as broker or agent tor the sale or purchase of governmedt or other securities books to be balanced twice a year  - - - - accounu and dividends' sf (1)  - - - -  (2) a statement 6f the balance at evf!ry sueh period signed  by a rilajority' ot the directors shall be forthwith sent to the central government  - - - - ~~~ , 65 a notice may be served on the bank by leaving it at, or ,od senqing' it by post to, any local head omce of the ba k n a bill to amend the state bank of india act, 19$5, (shri arun chandra gum, minister oj reoenue and defence expenditure) gipd-lad-sis ls-29-7-s5-iooo 