 bill no 210 of 1985 the industrial finance corporation (amendment) bill, 1985~ , l ~ > a "  bill further to amend the industrial finance corporation act, 1948 be it enacted by parliament in the thirty-sixth year of the republic of india as follows:-1 (1) this act, may be called the industrial finance corporation (amendment) act, 1985 5 (2) it shall come into force on such date as the central government short title add commencement may, by notification in the official gazette, appoint and different dates may be appointed for different provisions of this act 1948 z in section 2 of the industrial finance corporation act, (hereinafter referred to as the principal act), in clause (c) ,-15 of 1948 amendmentof section 2 sub-10 (a) for sub-clause (v), the following slib-clause shall be stituted, namely:- (v) the generation, storage or distribution of electricity or any other form of energy;"; (b) in sub-clause (vii), for the word "machinery", the words 15 "machinery or equipment" shall be substituted; (c) for sub-clause (ix), the following sub-clause shall be sub-btituted, namely: - "(i,'t:) the setting up of, or development of, an industrial are or an industrial estate;"; (d) in sub-clause (xi), the word "or" occurring at the end shall be omitted; (e) for sub-clause (xii) and the explanation below that subclause, the following sub-clauses and explanation shall be substituted, namely:-5 '(xii) providing engineering, technical, financial, management, marketing or other services or facilities for industry; (xiii) providing medical health or other allied services; (xtv) providing services relating to information technology, tele-communication or electronics; 10 (xv) leasing, sub-leasing or giving on hire or hire-purchase of industrial plants equipments, machinery or other assets, including vehicles, ships and aircraft; (xvio) such other activity as the central government may, having regard to the objects of this act, by notification in the 15 official gazette, specify in this behalf; or (xvii) the research and development of any concept technology, design, process or product, whether in relation to any of the matters aforesaid, including any activities specified under sub-clause (xvi), or any other matter 20 explanation-for the purposes of sub-clause (i) " the expression "processing of ioods" includes any art or process for producing, preparing or making an article by subjecting any material to a manual, mechanical chemical, electrical or any other like operation;' 25 3 in section 4 of the principal act,-after sub-section (ic), tbe follow- ing 8ub-sel'ti~ns shall be inserted, namely:-"(1d) on or after th~ commencement of the industria ifinance corporation (amendment) act 1985, the authoriled capital of the corporation may be increased to such amount not exceeding two 30 hundred and tifty crores of rupees as the central government may from til  : tu time b~' nfo tltl4,,jol1 in tile otiidai gazette, fix (ie) the ruthorist"d capital increased under sub-section (18b) shall be divided into such number of shares of five thousand rupees tart 8'1 u:ay be ~~~a,~', sud file s  ~ reprefltnting the cllpifftl 1110 35 increased may be isllued with the 8  ctif;)" of ~ c,~tral government as all~ when the corporation may deem fit" 4 in section 10 of the principal act, in sub-section (1) ,-amendment of section 10 (a) for clause (a) t~e following clause shall 'be substituted, namely:-"(a) a chairman and a managing director to be appointed 5 by the central government after consultation with the development bank: provided that the same person may be appointed to function both as chairman and as managing director"; (b) after clause (b), the following clause shall be inserted, lu namely:-'' (bb) one director nominated by the reserve bank;" 5 in section loa of the principal act,-amendmental seiiion loa (a) in sub-section (1), after the words "chairman of the board" thp words "or the managing director and, in a case where the same person is appointed to function both as chairman and as managing director, such person" shall be inserte:d; (b) for sub-section (2), the following sub-section shall be substituted, namely:-"(2) the chairman and the managing director shall hold 20 office for such term not exceeding five years as the central government may specify in this behalf and shall be eligible for reappointment"; (c) in sub-section (2a),- (i) for the word "chairman", at both the places where it 25 occurs, the words "chairman or the managing director" shall be substituted; (ii) for the words 1'specified in", at both the places where they occur, the words "specified under" shall be substituted; (d) after sub-section (3), the following sub-section shall be in-30 serted, namely:-"(3a) the managing director shall exercise such powers and discharge such duties as are assigned to him by this act or as may be delegated to him by the board or the chairman"; 35 45 (e) in su'b-section (4), for the portion beginning with the words "if the chairman is of opinion" and ending with the words "the chairman may take such action", the following shall be substituted, namely:-"notwithstanding !&nything cpntained in suibection (3), the chairman or, in his absence, the managing director, is of opinion that circumstances exist which render it necessary for him to take immediate action in respect of any matter which is within the competence of the board and that the interests of the corporation may be prejudicially affected if such action is deferred until after the next meeting of the board, then he may take such action" 8 in section 11 of the principal act,-amendmentof section 11 (4) in sub-section (2) for the words "four years", the words "three years" shall be substituted; (b) in the proviso to sub-section (4), for the word "chairman", the words "managing director" shall be substituted amend-7 in section 12 of the principal act, in clause (a), after the words mentof "the chairman", the words "or the managing director" shall be insection 12, serted 5 amend-8 in section 13 of the principal act, in sub-section (1), after the words ment of "the chairman", the words "or the managing director" shall be insection 13, serted, 9 in section 13a of the principal act after the word "board" the words "or the managing director" shall be inserted 10 amendmentof section 13a 10 in section 17 of the principal act,-amendmentof lectlod 17 (a) for sub-section (5), the following sub-section shall be substituted, namely:-"(5) the chairman or, if for any reason he is unable to attend a meeting of the board the managing director or, in the 15 event of both the cha'innan and the managing director being unable to attend such meeting, any other director nominated by the chairman in this behalf and in the absence of such nomination any director elected by the directors present from among them- ' selves, shall preside at the meeting"; 20 (b) in sub-section (6) ,-(i) after the word, brackets and letter "clause (b)" at both the places where they occur, the words, brackets and letters "or clause (bb)" shall be inserted; (ii) after the words "central government", the words "or 25 the reserve bank" shall be inserted amendmentof section 19, 11 in section 19 of the principal act, after the words "state· cooperative bank", the words "or, with the approval of the reserve bank, with any bank outside india" shall be added amendmentof aection 20 12 in section 20 of the principal act, for the words "the shares of any 30 financial institution which the central government may, in consultation with the development bank, notify in this behalf", the words "the units of the said unit trust of india, or the shares, bonds or debentures of any financial or development institution or organisation" shall be substituted 13 in section 21 of the principal act,-35 (a) in sub-section (3), the proviso shall be omitted; amendmentof section 11 (b) in suh-section (4), for the words "or, with the genel'8l or special approval of the central govemment, from any other authority or institution in india", the words, "the life insur¥ce corporation of india established under section 3 of the life 40 insurance corporaticn ad, 1958, the general insurance corporation 31 of 1956 of india formed ~nd registered under the companies act, 1958, the lor 1956, unit trust of india established under section 3 of the unit trust of adia att, 1963 or, witb the general or special approval of the cen-52 or 1963 tnl govemment, from iiny other authority, institution, organisation 45 or tl'wlt within or outside india" shall be substituted 1( in section 23' of the principal act,-amendmentof stction 23 (a) in clause (a), in sub-clause (ii), the word "state" shall ·be omitted; (b) in clause (e) ,_ 5 (i) after the word "development", the words "or any other international or national institution or organisation" shall be inserted; (ii) for the words "or debentures subscribed, by either of them", the words "or stocks, shares, bonds or debentures sub-in scribed, by any of them or on their behalf' shall be substituted; (e) in clause (k) ,-(i) after the word "technical", the words ", legal, marketing" shall be inserted; (ii) for clause (1), the following clause shall be substituted 15 namely:-"(1) providing consultancy and merchant banking services "in and outside india;"  15 in section 30a of the principal act,-20 (a) in sub-section (1), for the words "directors of that industrial concern", the words "directors, or as the case may be the administrator of that industrial concern" shall be 'substituted; amendmentof aection 30a (b) in sub-section (2), for the words ",firm or company to be the managing agents" the words "to be the manager" shall be substituted 18 in section 30b of the principal act,-amendmentof (a) for clause (a), the following clause shall be substituted section namely: -30b "(a) all persons holding, immediately before the issue of the notified order, office as directors of the industrial concern 30 or any other offices entitling them to exercise powers of superintendence, direction and control of the 'industrial concern, shall be deemed to have vacated their offices as suck;"; (b) in clause (b) the words "any managing agent or" shall be omitted: 35 (e) for clause (c), the following clause shall be substituted, namely:-lof 1956 "(c) the manager, if any, appointed under section 30a, shall be deemed to have been appointed in pursuance of the provisions of the cempanies act, 1956 and the memorandum and articles of asociation of, the industrial concern or as· the case may be, of any law for tbe tim~ being in force relating to co-operative societies and the memorandum or other instrument of, the industrial concern, and toe provisions of the said act or law, and of the memorandum and articles of association, or, as the case m,ay be memorandum or otber' instrument shall, subject to the otber provisions contained in this act, apply accordingly, but no such manager shall be removed from office except with the previous consent of the corporation;"; (d) in clause (d), for the word "directol'l", at both the places 1 where it occurs, the words "directors or, as the case may be, administrator" shall be substituted; (e) for clause (e), the following clause shall be substituted namely:- (e) the directors appointed under section 30a shall, for all 10 purp068s, be the directors of the industrial eoncern duly constituted under the companies act, 1956 or under any law for the time 1 of 1966 being in force relating to co-operative societies, and such directors or, as the case may be, the administrator appointed under section 3oa, shall alone be entitled to exercise all the powers 15 of the directors (by whatever name called) of the industrial concern, whether such powers are derived from the said act or the law or the memorandum or articles of association or as the case may be, the memorandum or other instrument of the industrial concern;" 20 17 in section 30c of the principal act, in sub-sections (l) and (2), for the word "directors", the words "directors or administrator" shall be substituted amendmentof lection 3oc 18 in section 30d of the principal act,-ameddmeat of liectioa 30d (a) in sub-section (1), for the words 'ino managing agent, 25 managing director or any other director of an industrial concern", the words "no managing director or any other' director or manager or holder of any office having the powers of superintendence, direction and control of an industrial concern" shall be substituted; (b) in sub-section (2), for the words "managing agent or manag- 30 ing director or any other director", the words "managing director or any other director or manager or holder of oftlce refeited to in that rub-section" shall be stlbstituted  amcndmeat of section 38a 19 in section 3'8a of the -principal act, after the word "director", at both the places where it occurs, the words "or administrator" shall be 35 inserted 20 in section 40a of the principal act, after the words "the chairman"; the words "managing director" shall be inserted aideddmeat 01 iectioa 40a 21 in section 43 of the principal act,-(4) in sub-section (1) after the ~ords udeveloptnent bank" the 4<> words "and by notification in the oftlclal gazette" shall be inserted ameadmentof eectiod 43 (b) in sub-section (2),,-(i) in clause (ee), after tb~ word "chalrman" the words ", managing director" shall be inserted; (ii) in clause (m), after the word "diretrto~ th, words 45 "or administrator'l shall be il1serted 22 for the schedule to 1ihe principal act, the following schedule shall be substitutecl, namely:"""-subitieuticjd ofsclaedale  "the schedule [see section 39 (3)] dlx::laratioin on fmelity and secrecy5 10 i,  '"  :'" do hereby declare that i will faithfully, truly and to the best of my skill and ability execute and perform the duties required of me as director, member of  committ~, auditor, ofllcer or other employee (as the case may be) of the industrial finance corporation of india and which preperly relate to the office or position held by me in or in relation to the said corporation i further declare that i will not communicate or allow to be communicated to any person not legally entitled thereto any information relating to the affairs of the industrial finance corporation of india or to the affairs of any person having any dealing with the said corporation, nor will i allow any such person to inspect or have access to any books or documents belonging to or in the possession of the said corporation and relating to the bus'iness of the said corporation or the business of any person having any dealing with the said corporation 20 signed before me signature   date  ' "  "  statement of objects and reasonsthe industrial finance corporation of indibi was set up in 1948 as an all-india term lending institution its operations and activities have expanded considerably over the years in or~er to cope up with this expanding role and in the light of the experience gained in the functioning of the corporation, since the industrial finance corporation act, 1948 was last amended in 19b2, it has become necessary to make some amendments in the act 2· the amendments are mainly aimed at enlarging the area of operations of the corporation in view of the rapid technological developments in the industrial field, augmenting its resources, re-organising its management pattern, ann removing certain unnecessary restrictions in the procedural arid operational matters of the corporation the main proposals for the ~mendments are as follows:-(a) industrial finance corporation of india provides various types 'of facilities to 'industrial concerns' the present definition of 'industrial concern' as contained in the industrial finance corporation act does not cover many important activities  it is, therefore proposed to widen tl)e definition of 'industrial concern' by including the concerns engaged inter alia, in areas such as setting up of hospitals and providing medical services, providin!! telecommunication and electronics services and leasing of plants and equipments, etc it is also envisaged to provide fo!' an enablin~ clause so as to confer powers on the central government to direct the corporation to undertake any other activity which the central government may notify (b) in vipw of the constantjy expanding business of the corporation and th£' increasing cost or the projects, it is propoc;ed to raise the authorised capital of the corporation from the present limit of rs 100 crores to an amount not ext'eeding rs 250 crores as may be fixed by the central government hy notification from time to time (c) at present the act enablec; the central government to ap· point a whole-time cliairman of the corporation it i!; proposed to provide for thp office of the managing director al!;o on the same pattern as in the case of the industrial development bank of· india industrial reconstruction bank of india and the nationalised banks this wilj provide v,reater fle:vil)i1itv to the government to appoint a separate mnnaf!in~ directt't" if felt necessary it iq alro proposed to have n director nominated hv the reserve bank of india on the bo:trd of the corporation (d) the act at present enables the corporation to open deposit accounts with the reserve ~ank of indir or its aftencv or with a !':ched111pd bank or it state cnoperathre bank for better mana~ement of its operations of borrowine'i lendinv and renavinp in forei~ currency it is proposed that the c"('rporntion mn~t open deposit accotlnt~ with any other bank outside india with the approval of the reserve bank (e) presently the corporation is authorised to invest in the skares of any financial institution notified by central government with a view to enlarge the scope of activities of the corporation, it is' proposed that the curporation could subscribe to the shares, bonds, debentures of an!~ financial or development institution or organisation (f) with a view to provide more flexibility to the corporation in raising resources, it is proposed to remove the present limit of rs 15 crores on borro',,; ings by the corporation, from the reserve bank of india (g) it is proposed to make an enabling provision in the act so as to authorise the corporation to borrow money from the life insurance corporation of india, the general insurance corporation of india and the unit trust of lndia as albo from any authority, institution, organisation or trust in or outside india with the approval of the central government besides borrowin~ from central government or the industrial development bank of india (h) at present the -corpcjl'ation has no power to guarantee loans raised by industrial concerns from cooperative banks other than state cooperative banks in order to provide far greater flexibility to the corporation, it is proposed to enable the corporation to guarantee loans raised from any cooperative bank (i) the corporation can act as an agent of the central government or with its approval for the international bank for reconstruction and development it is proposed to enable the corporation to act as an agent for any other national or international institution or organisation with the approval of the central government (j) it is proposed to widen the scope of assistance of the corporation to industrial concc:ns by providing that the corporation can give 'legal and marketing' assistance to the industrial concerns u also consultancy and merchant bankin:g services in or outside india (k) as the institution of "managing agent" has been abolished, it is proposed to omit the references to managing agents in sections 30a to 30d of the act and make the necessary consequential changes therein (1) the form of declaration of fidelity and secrecy contained in the schedule to the act is proposed to be substituted so as to bring it in line with that contajned in the industrial development bank of india act, 1 ~64 (m) the other changes proposed in the act are of a minor or consequential nature the bill seeks to achieve the above objects new delhi; vishwanath pratap singh the 13th december, 1985 codsequetlt to the amendment proposed in clause 3 of the 8&, the authorised capital of the industrial finance corporation of indb may be increased· to such amoun't not exceeding rs 250 crores as the ceh"fral g0-vernment may fix from time to time by notiftcation in the official'gazeite since under section 5 of ~he indu~trial finance 'corporation act, 'r94b, 'the shares of the corporation shall be guaranteed by the central government as to the repayment of tbe ,principal and the payment of an annual dividend at such minimum rate ac; may be fixed by the central government at the time of issumg the shares, when the corporation issues further shares, the central government shall have to give similar guarantees for the shares so i~s'led furtber, in the event of the central government at any time, deciding, in terms of section 36 (1) of the act, to aequire the shores held by shareholders other than the industrial development bank of india, the central government will be required to pay to the shiueholders an arn·oullt equal to the paid-up value of 'the -shares ·together with a premium calculated at the rate of one per cent ofthepaid-ul'va1ue for every year from the date of i!lsue to the date of acqubitionby the central government, subject to a maximum of ten per cent 'in such eventuality, to the extent of additional shares issued out oftlie inereued authorised capital, the liability of the central government will increase 2 clause 13 of the bill seeks to amend section 21(3)(b) of the act to delete the proviso in the section which provides that the corporation cannot borrow more than rs 1!) ('rores from the raerve bank of tndia for carrying out its functions the bonds and debentures of the c~lpora­tidtl referred to in the 'section are guaranteed by the central government in terms of sub-section (2) of section 21 as to the repayment of the 'ptincipal and interest tt is, therefore, likely that the corrtigent jiabihties of the central government in respect of the guarantees will also be increased '3 the financial implication arising out of clause 3 and clause 13 of the bill are not capable of being quantified at this stage clause 2 of the bill ~k~ to insert a new su~clause (xvii) in clause (c) of section 2 of the industrial finance corporation act, 1948, empowering the central governmcmt ·to ir:lcl~4e within the definition of "industrial concerp", by notjfication in the official gazette any other activity, having regard to the objects of the act 2 clause 3 of the bill seeks t8 empower the central go'yermnent to increase the authorised capital of the industrial finance corporation of india, from time to time, by notification in the official gazette the pow~l' ~~nferred on the central government by this ~use is subject to the z;i,ljlxi}n~ limit of two hundred and fifty crores of rupees 3 at present under section 30a of the act, the corporation has power to appoint directors of an industrw concern when management is tam» over with a view to securij;lg greater flexibility, particularly in the cue of industrial concerns which are cooperative societies, clause 15 of the _ bill :eeks to give ohoice to th~ ~~al gpv~~t to appqint e1ther directors or an administrator 4 clause 17 of the bill seeks to make the necessary oonaequential amej)c:b:pe~t in ec;~qn 30c of the act to provide for the prescribing by rul", qj' r:~~tjons the powers and duties of such ~dminis~tors 5 the delegation of the legislative power under clauses 2, 3 and 4 of the bid is nonnai in chuacter  annexure ex'dtacts from the industrial finance corporation act, 1948(15 or 1948) - - - - z in this act, unless there is anything repugnant in the subject or context,-- - - - (c) "industrial concern" means any limited company or c0-operative society incorporated by a central act or an act of the legislature of a state 01' under any law for the time being in force and registered in india which is engaged or is to be engaged tn-·   ~  (v) the generation or distribution of electricity or any other fonn of power; - , - - (vii) the maintenance, repair testing or servicing of machinery of any description or vehicles or vessels or motor-boats or trailers or tractors; - •• - - - (ix) the development of any contiguous area of land as an lndustrial estate;  - - - - (xi) providing special or technical knowledge or other bervices for the promotion of industrial growth; or (xii) the research and development of any process or product in relation to any of the matters aforesaid explangtion-the expression "processing of goods" includes any art or process for produclng, preparing or making an article by subjecting any material to a manual, mechanical, chemical, electrical or any other like operation; - - - - - it, (1) the board of directors shall consist of the following name1y:-board of directan (a) a chairman to be appointed by the central government after consultation with the development bank; - - - - lea (1) the chairman of the board shall receive such salary and al-0wrmu lowances as may be determined by the development bank with the apof tile prova} of th~ central government board (2) the chairman shall hold office for four years or until his iuc-cessor is appointed and shall be eligible for reappointment (2a) notwithstandjng anything contained in sub-section (2), the ,central government shall have the right to terminate the term of offtce of the chairman at any time before the expiry of the term specified in sub-sectiofl (2) by gjvin~ him notiee 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 offce at any time before the expiry of the term specified in sub-section (2) by giving to the c~ntral government notice of not less than three months in writing (3) the chairman shall exercise such powers and oh;(,l1::trge such duties as are assigned to him by this act or as may be delegated to him by the board (4) if the chairman is of opinion that circumstances exist which render it necessary for him to take immediate action in respect of any matter which is within the competence of the board and that the interests of the corporation may be prejudicially affected if such action {s deferred until after the next meeting of the board then, notwithstanding anything contained in sub-section (3), the chairman may take such action in rr'!1nf'rt or that matter as he deems necessary and for such pljrpose, he mav exercise all powers and do all acts and things which may be exercised or done bv the board but in every such case, he shall as soon as may be, after the action is taken make a written report to the board containing a statement of the action taken and the circumstances under which it was taken 11 (1) - - - - - (2) an elf!cted director !;halj hold office for four years: term of ofik:e iuid retlremeat of direcion provided thl:1t one out of the two t)jrectors elected to rel)l"esent the shareholders refelted to in each of the clauses (e), (d) and (e) of secfion 10 shall retire at the end of two vears after the ftrst election: the director so to retire shall be determined by lot: provided further that an elected director shall be required to continue in his offi,~e until his !':uccessnr has been elected: provided further that such a director shall be elhtible for r~tectfon for not more than two full ct'nsecutive terms after the rotattnn of elected director!': has begun - - - - (4) directors shall be naid such fees ae; mav be prpscrib~ct for attentlinl! the mt:!ptinp<: nf tlp bnrret ;lnrl ';, thev are mpmbe" of anv committee apdointed by the corporation, for a,ttendlng meetln~ of sucb committee: ~ov\w \h_ 'n)\'t\'m," \n \'nu m'chlect\on shall apply to the chairaan ot' to any otner d\ret\of wno 'is a 8el'vant ot tbe government ~ of the development bank disqualiji- 12 no person shall be a director who-~mot\ (a) except in the case of the chainnan is a salaried oftlcia1 of the col:poratigl'l; or - - - - - 1m 1£ the ctairman or the board is by infirmity or otherwise ren-deyelopment bank at any time remove the chairman from ofdce: removal of director from office provided that no person shall be removed from his offtce, under this sub-section, unless he has been given an opportunity of showiqg ca~ against his removal - - - - 13a if the chairman of the board ill by infirmity or otherwi~e rend~red id;capable of carrying out his c1uties or is absent on leave or other-casual vacancy of chairman wi~ in circumstances not involving the vacahon of his appointment, the  central government may, after consultation witli the devitlopment bank: appoint anoth~r person 'to act in his place during his abllence - - - - 17 (i) - - - - - liieetinls of board (5) if for any reason the chairman is unable to be present at a meeting of the board: r director authorised bv the chainnan in  wrlt- fng in tms behalf shall preside at that meetinc;t and in default of such authorisation, the board may elect a director to reeide at that meatng (6) if for anv reason, a director nominated un~er claus~ (aa) or clause (b) of section 10 is unable to attend any mee'tine! of the board the develodmpnt bank or ttle central government, as the cme may be, may depute any "ther ~tson to attencj the ~atd meetin~ an~ such denon ,wlt· for au mtrqptses of the :laid meeting he deemed to be a tlinctor twjnina~dun~~r clause (atj) o~ clause (b, as the ease may be of the said ~on  - - - - deposit accounts 19 the corporation mav onen depobft accounts with the reset'vp b4nk or wi~h 81ly aslencv t)f the ~eserve bank other th~n a govern- me!nt trea!'ln~ or '\1i-i1:h ~ sch:'du1pd h!\nk ot' l'i statp (!o-operlttfve batlk inveetmentof· funds 20 the corporation mav invest its funds in the securities r4 the c"ntral govemment or of any state government and mav with the addroval of the central go~mment contrtbute to the inft{al cidltal ·of the unit trust of india established under the unit trust of indi~ ·aot 196~and' the cot'poration mav also subscribe to oj' nut'chase the 52 of 1983 ·sha~ of any flrt~lld,al institution which the central c'70vernmttnt may, in consultation with the development bank, notify in this behalf (3) the corporation may, for the purpose of carrying out its functions under this act, borrow money from the reserve bank,-(a) repayable on demand or on the expiry of ftxed periods not e'xceeding ninety days from the dat~ on which the rndtl~ is so borrowed, against securities of the central government or of any state government; or (b) repayable on the expiry of fixed periods not exceeding eighteen months from the date on which the money is so borrowed, against securities of the central government of any maturity or against bonds and debentures issiled by th~ corporation unc!er sub-section (1) and guaranteed by thecerttl'ai government and maturing within a period not exceeding eighteen months from the date on which the money is so borrowed: provided that the amount borrowed by the corporation under clause (b) shall not at any time exceed fifteen ct'ores of ru~ in the aggregate (4) the corporation may also, for the purpose of carrying out its functiol'ls under this act, borrow tnoney from the cen'u'algovemment '01' the d~elopme!tltbank or, w'fth the general or speciaj approval of the central government, fi"om any ot~ authoritybr i~tutton in india on such terms and conditions as may be agreed upon: - - -  ' 23 the corporation shall, subject to the provisions (}f this act, be busi authorised to carry on and transact the following kinds of business, ness which n'amely:-the corpora_ tionmay transact  (a) guaranteeing,-- - - - (ii) loam rllised by industrial roneems from scheduled banks, state co-operative banks or such other financial institutidnsasn'iay 'be notified by the central govemm~t in this behalf; - - - - (e) acting as agent for the central government or, with its approval, for the international bank for reconstruction and development in the transaction of any business with an industrial con- cern in respect of loans or' advances granted, or debentures subscribed, by either of them; - - - - - (k) pro"tding technical and administrative assistance to any industrial concern for the prorhotion, management or expansion of any industry; (1) undertakine merchant banking operations; 1 of 19$6 3oa u) when the management of an industrial concern is taken over by the corporation, the corporation may, by order notified in the official gazette, appoint as many persons as it thinks fit to be the directors of that industrial concern and nothing in the companies act, 1956, or in any such law or instrument relating to the industrial concern in so far as it makes, in relation to a director, any provision for the holding ol any share qualification, age limit, restrictions on the number of directorships, retirement by rotation or removal from offi,ce shall apply to any director appointed by the corporation under this section powkof corporationtg appoint directon otan biduatrid coiicti1l  1d8iiif-iiiedt - tatoo o¥er (2) the power to appoint directors under this section includes the power to appoint any individual, firm or compjllly to be the managing agents of the industrial concern' on such terms and conditions as the corporation may think fit  3ob on the issue of a notified order under section 30a-elect· oidotiftedorder a,pojatin, dlncton (a) all persons holding office as directors of the industrial concern immediately before the issue of the notifted order shall be deemed to have vacated, their offices as such; (0) any contract of management between the industrial concern and any managing agent or any director thereof holding office as such immediately before the issue of the notified order shall be deemed to have terminated; 1 of 1956 (c) the managing 'agent, if any, appointed under section 30a shall be deemed to have been duly appointed in pursuance of the companies act, 1956 and the memorandum and articles of association of the industria} concern and the provisions of the said act and of the memorandwn and articles shall, subject to the other provisions contained in this act, apply accordingly, but no such managing agent shall be removed from office except with the previous consent of the corporation; (d) the directors appointed under section 30a shall take such steps as may be necessary to take into their custody or other their control all the property, effects and actionable claims to ~hich the industrial concern is, or appears to be, entitled, and all the propeu"ty and effects of the industrial concern shall be deemed to be in the custody of the directors as from the date of the notified order; (e) the directors appointed under section 30a shall be" for all purposes, the directors of the industrial concern duly constituted under the companies act, 1956 and shall alone be entitled to exercise all the powers of the directors of the industrial concern, whether such powers are derived from the said act or from the memorandum or articles of association of the industrial concern or from any other source 3oc (1) 'subject to the controlof the ' corporation, the directors appoinied under section 30a shall take sueh steps as may be necessary for the purpose of efficiently managing the business of the industrial concern and shall exercise such powers and have such duties alt may be prescribed (2) without prejudice to the generality of the powers vested in them under sub-section (1), the directors appointed under section 30a may, with the previous approval of the corporation, make an application to a court for the purpose of cancelling or varying any contract or agreement entered into, at any time before the issue of the notified order uhder section 3oa, between the industrial concem and any other person and the court may, if satisfied: after due inquiry that such contract or agreement had been entered into in bad faith and is detrimental to the interests of the industrial concern, make an order cancelling or varying (either unconditionally or subject to such 'conditions as it may think fit to impose) that contract or agreement and the contract or agreement shall have effect" accordingly =-> (1) notwithstanding anything contained in any law for the time being in force, no managing agent, managing director or any other director of an industrial concern shall be entitled to any compensation for the loss of office or for the premature tennination und'v this act of any contract of management entered into by him with such concern norigbt tocompen-iatiod fortermiuationof c:ontract of !id8iiag;di ,cdts (2) nothing contained in sub-section (1) shall aftect the right of any such managing agent or managing director or any other dirt!ctor to recover· from the industrial concern moneys recoverable otherwise than by way of such compensation lit  - -  38a no suit prosecution or other lega] proceeding shall lie against any director of any industrial concern appointed by the corporation under section 25 or section 30a for anything which is in good faith done or intended to be done by him as such director pmfec:tion of imltion taten !by director ajlpoinff'd udder weetions 25 and 30a delepllod ofpowen 40a t~e board may, i_,y general or special order, delegate to the chairman or any oftlcer of the corporation, subject to s~h conditions and limitations, if any, as may be specified in the order, sueh of its powers and duties under this act as it may deem necessary     -  power of board eo make relulatlons 43 (1) the> board may, with the previous approval of the development bank make regulations not inconsistent with this act and the rules made thereunder to provide for all matters for which provision is necessary or expedient for the> purpose of riving effect to the provisions of this act (2) in paniculclr and without prejudice to the generality of the foregoing power, ruc1': r(>~ulatlo~!> may provide fot"-(ee~ the delegation of powers and functions of the board to the chairm~m or to officers of t'l(' corporation; - - - - (m) the taking over of the managing of any industrial concern on a breach of its agreement with the corporation and the powers and duties of directors under section 3oc; lit - - - -  the schedule [see section 39 (3')] oi:claaation of fidelity and silcriicyi,  , do declare that i will faithfully, truly and to the best of my judgment, sldll and, ability, execute and perform the duties required of me as a director, officer, employee or auditor (as the case may be) of the industrial finance corporation of india and which properly relate to any office or position in the ibid corporation held by me i further declare that i will not communicate or allow to be communicated to any person not legally entiued thereto any information relating to the affairs of the corporation nor will i allow any such person to inspect or have access to any books or documents belonging to or in the possession of the corporation and relating to the business of the coiporation signature    signed before me date    billfurther to amend the industrial finance corporation act, 1948 (shri vishwanath pratap $if&(lh, minister at fitt4~) i  