The Industrial Development Bank (Transfer of Undertaking and Repeal) Act, 2003

(1) This Act may be called the Industrial Development Bank(Transfer of Undertaking and Repeal) Act, 2003. (2) It shall come into force on such date 1as the Central Government may, by notification, appoint.

In this Act, unless the context otherwise requires,-- (a) "appointed day" means such date as the Central Government may, by notification, appointunder section 3; (b) "Company" means the Industrial Development Bank of India Limited to be formed andregistered under the Companies Act, 1956 (1 of 1956); (c) "Development Bank" means the Industrial Development Bank of India established undersub-section (1) of section 3 of the Industrial Development Bank of India Act, 1964 (18 of 1964); (d) "notification" means a notification published in the Official Gazette; (e) "Reserve Bank" means the Reserve Bank of India constituted under the Reserve Bank of IndiaAct, 1934 (2 of 1934).

(1) On such date as the CentralGovernment may, by notification, appoint, there shall be transferred to, and vest in, the Company, theundertaking of Development Bank. (2) Notwithstanding anything contained in the Banking Regulation Act, 1949 (10 of 1949), theCompany referred to in sub-section (1) shall be deemed to be a banking company within the meaning ofclause (c) of section 5 of the Banking Regulation Act, 1949 and as such shall carryon banking business inaccordance with the provisions of that Act, 1***: Provided that such Company shall not be required to-- (a) obtain licence under section 22 of the Banking Regulation Act, 1949 (10 of 1949); (b) maintain for a period of five years from the appointed day the percentage of assets required tobe maintained under section 24 of the said Act. 2[Provided further that the provisions of clause (a) to the proviso, shall cease to be applicableimmediately after the commencement of Part XIII of the Finance Act, 2021, and from such commencement, the Company shall be deemed to have obtained licence under section 22 of theBanking Regulation Act, 1949 (10 of 1949).] (3) The provisions of the Banking Regulation Act, 1949 (10 of 1949) shall, as far as may be, to theextent they are not repugnant to any provision of this Act, apply to such Company. (4) Notwithstanding anything contained in the Banking Regulation Act,1949 (10 of 1949), the CentralGovernment may, in consultation with the Reserve Bank of India, by notification, direct that any of theprovisions of that Act specified in the notification-- (a) shall not apply to the Company; or (b) shall apply to the Company, only with such exceptions, modifications and the adaptations asmay be specified in the notification. (5) A copy of every notification proposed to be issued under sub-section (4), shall be laid in draftbefore each House of Parliament, while it is in session, for a total period of thirty days which may becomprised in one session or in two or more successive sessions, and if, before the expiry of the sessionimmediately following the session or the successive sessions aforesaid, both Houses agree indisapproving the issue of the notification or both Houses agree in making any modification in thenotification, the notification shall not be issued or, as the case may be, shall be issued only in suchmodified form as may be agreed upon by both the Houses.

(1) The Central Government, being theshareholder of the Development Bank and every other shareholder of the Development Bank immediatelybefore the appointed day shall be deemed to be registered on and from the appointed day as a shareholderof the Company to the extent of the face value of the shares held by such shareholder. (2) The undertaking of the Development Bank which is transferred to, and which vest in, theCompany under section 3 shall be deemed to include all business, assets, rights, powers, authorities andprivileges and all properties, movable and immovable, real and personal, corporeal and incorporeal, inpossession or reservation, present or contingent of whatever nature and wheresoever situate includinglands, buildings, vehicles, cash balances, deposits, foreign currencies, disclosed and undisclosed reserves,reserve fund, special reserve fund, benevolent reserve fund, any other fund, stocks, investments, shares,bonds, debentures, security, management of any industrial concern, loans, advances and guarantees givento any person or industrial concern, tenancies, leases and book debts and all other rights and interestsarising out of such property as were immediately before the appointed day in the ownership, possession orpower of the Development Bank in relation to its undertaking, within or without India, all books ofaccount, registers, records and documents relating thereto and shall also be deemed to include allborrowings, liabilities and obligations of whatever kind within or without India then subsisting of theDevelopment Bank in relation to its respective undertaking. (3) All contracts, deeds, bonds, guarantees, powers of attorney, other instruments and workingarrangements subsisting immediately before the appointed day and affecting the Development Bank shallcease to have effect or to be enforceable against the Development Bank and shall be of as full force andeffect against or in favour of the Company in which the undertaking of the Development Bank has vestedby virtue of this Act and enforceable as fully and effectually as if instead of the Development Bank, theCompany had been named therein or had been a party thereto. (4) Any proceeding or cause of action pending or existing immediately before the appointed day by oragainst the Development Bank in relation to its undertaking may, as from the appointed day, be continuedand enforced by or against the Company in which the undertaking of the Development Bank has vestedby virtue of this Act as it might have been enforced by or against the Development Bank if this Act hadnot been enacted and shall cease to be enforceable by or against the Development Bank.

(1) Every officeror other employee of the Development Bank (except a director of the Board or the chairman andmanaging director or any whole-time director) serving in the employment immediately before theappointed day shall, in so far as such officer or other employee is employed in connection with theundertaking which has vested in the Company by virtue of this Act, become, as from the appointed day,an officer or, as the case may be, other employee of the Company and shall hold his office or servicetherein by the same tenure, at the same remuneration, upon the same terms and conditions, with the sameobligations and with the same rights and privileges as to leave, leave fare concession, welfare scheme,medical benefit scheme, insurance, provident fund, other funds, retirement, voluntary retirement, gratuityand other benefits as he would have held under the Development Bank if its undertaking had not vested inthe Company and shall continue to do so as an officer or, as the case may be, other employee of theCompany or until the expiry of a period of six months from the appointed day, if such officer or otheremployee opts not to continue to be the officer or other employee of the Company within such period. (2) Where an officer or other employee of the Development Bank opts under sub-section (1) not to bein employment or service of the company, such officer or other employee shall be deemed to haveresigned. (3) Notwithstanding anything contained in the Industrial Disputes Act, 1947 (14 of 1947), or in anyother law for the time being in force, the transfer of the services of any officer or other employee of theDevelopment Bank to the Company shall not entitle such officer or other employee to any compensationunder this Act or under any other law for the time being in force and no such claim shall be entertained byany court, tribunal or other authority. (4) The officers and other employees who have retired before the appointed day from the service ofthe Development Bank and are entitled to any benefits, rights or privileges shall be entitled to receive thesame benefits, rights or privileges from the Company. (5) The trust of the provident fund or the gratuity fund of the Development Bank and any other bodiescreated for the welfare of officers or employees would continue to discharge their functions in theCompany as was being done hitherto in the Development Bank and any tax exemption granted to theprovident fund or the gratuity fund or pension fund would continue to be applied to the Company. (6) Notwithstanding anything contained in this Act or in the Companies Act, 1956 (1 of 1956), or inany other law for the time being in force or in the regulations of the Development Bank, no director of theBoard, chairman and managing director or any whole-time director or any other person entitled to managethe whole or substantial part of the business and affairs of the Development Bank shall be entitled to anycompensation against the Development Bank or the Company for the loss of office or for the prematuretermination of any contract of management entered into by him with the Development Bank.