The National Bank for Agriculture and Rural Development Act, 1981
Administered Ministry: Ministry of Finance / Department of Financial Services
Section
Section 1 Short title, extent and commencement.
(1) This Act may be called the National Bank for Agriculture and Rural Development Act, 1981.
(2) It extends to the whole of India.
(3) It shall come into force on such date 1 as the Central Government may, by notification in the Official Gazette, appoint, and different dates may be appointed for different provisions of this Act, and any reference in any provision to the commencement of this Act shall be construed as a reference to the coming into force of that provision.
(2) It extends to the whole of India.
(3) It shall come into force on such date 1 as the Central Government may, by notification in the Official Gazette, appoint, and different dates may be appointed for different provisions of this Act, and any reference in any provision to the commencement of this Act shall be construed as a reference to the coming into force of that provision.
1. 1st May, 1982, vide notification No. S.O. 278(E), dated 21st April, 1982 (except sections 3, 16 and 18), see Gazette of India, Extraordinary, Part II, sec. 3(ii). 12th July, 1982, vide notification No. S.O. 484(E), dated 6th July, 1982 (in respect sections 3, 16 and 18), see Gazette of India, Extraordinary, Part II, sec. 3(ii).
Section 2 Definitions.
In this Act, unless the context otherwise requires,--
(a) "agriculture" includes horticulture, animal husbandry, forestry, dairy and poultry farming, pisciculture, and other allied activities, whether or not undertaken jointly with agriculture and the expression "agricultural operations" shall be construed accordingly.
Explanation.--For the purposes of this clause, "pisciculture" includes the development of fisheries, both inland and marine, catching of fish and all activities connected therewith or incidental thereto;
(b) "Agricultural Refinance and Development Corporation" means the Corporation established under section 3 of the Agricultural Refinance and Development Corporation Act, 1963 (10 of 1963), and renamed under section 3A of that Act as the Agricultural Refinance and Development Corporation;
(c) "Board" means the Board of Directors of the National Bank;
(d) "central co-operative bank" means the principal co-operative society in a district in a State, the primary object of which is the financing of other co-operative societies in that district:
Provided that in addition to such principal society in a district, or where there is no such principal society in a district, the State Government may declare any one or more co-operative societies carrying on the business of financing other co-operative societies in that district to be also or to be a central co-operative bank or central co-operative banks within the meaning of this definition;
(e) "Chairman" means the Chairman 1*** appointed under section 6;
(f) "co-operative society" means a society registered, or deemed to be registered, under the Co-operative Societies Act, 1912 (2 of 1912) or any other law relating to co-operative societies for the time being in force in any State;
(g) "crops" includes products of agricultural operations;
(h) "director" means a director appointed under section 6;
2* * * * *
(j) "Managing Director" means the Managing Director appointed under section 6;
(k) "marketing of crops" includes the processing of crops prior to marketing by any agricultural producers or any organisation of such producers;
3[(ka) "micro enterprise", "small enterprise" and "medium enterprise", shall have the same meanings as are respectively assigned to them in the Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006)];
(l) "National Bank" means the National Bank for Agriculture and Rural Development established under section 3;
(m) "notification" means a notification published in the Official Gazette;
(n) "primary rural credit society" means a co-operative society, by whatever name called,--
(1) which has as its object or business the provision of financial accommodation to its members for agriculture or agricultural operations or for the marketing of crops, or for rural development; and
(2) the bye-laws of which do not permit admission of any other co-operative society as member:
Provided that this sub-clause shall not apply to the admission, as a member, of a co-operative society, which is a State co-operative bank or a central co-operative bank by reason of such bank subscribing to the share capital of the co-operative society out of funds provided by the State Government for the purpose;
(o) "prescribed" means prescribed by regulations made under this Act;
(p) "regional rural bank" means a regional rural bank established under section 3 of the Regional Rural Banks Act, 1976 (21 of 1976);
(q) "rural development" means development of rural areas through any activities conducive to such development.
Explanation.--For the purposes of this clause,--
(a) activities conducive to development of rural areas include activities relating to production of goods or provision of services in rural areas and activities for the promotion of cottage and village industries, 4[micro-enterprises, small enterprises and medium enterprises, handicrafts, handlooms] and other rural crafts;
(b) "rural area" means the area comprised in any village and includes the area comprised in any town, the population of which does not exceed ten thousand or such other figure as the Reserve Bank may specify from time to time;
(r) "Reserve Bank" means the Reserve Bank of India constituted under section 3 of the Reserve Bank of India Act, 1934 (2 of 1934);
(s) "scheduled bank" means a bank for the time being included in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934);
5* * * * *
(u) "State co-operative bank" means the principal co- operative society in a State, the primary object of which is the financing of other co-operative societies in the State:
Provided that in addition to such principal society in a State, or where there is no such principal society in a State, the State Government may declare any one or more co-operative societies carrying on business in that State to be also or to be a State co-operative bank or State co-operative banks within the meaning of this definition;
(v) "State land development bank" means the co-operative society which is the principal land development bank (by whatever name called) in a State and which has as its primary object the providing of long-term finance for agricultural development:
Provided that, in addition to such principal land development bank in a State, or where there is no such bank in a State, the State Government may declare any co-operative society carrying on business in that State and authorised by the bye-laws of such co-operative society to provide long-term finance for agricultural development to be also or to be a State land development bank within the meaning of this definition;
(w) words and expressions used herein and not defined but defined in the Reserve Bank of India Act, 1934 (2 of 1934), shall have the meanings respectively assigned to them in that Act;
(x) words and expressions used herein and not defined either in this Act or in the Reserve Bank of India Act, 1934 (2 of 1934), but defined in the Banking Regulation Act, 1949 (10 of 1949), shall have the meanings respectively assigned to them in the Banking Regulation Act, 1949.
(a) "agriculture" includes horticulture, animal husbandry, forestry, dairy and poultry farming, pisciculture, and other allied activities, whether or not undertaken jointly with agriculture and the expression "agricultural operations" shall be construed accordingly.
Explanation.--For the purposes of this clause, "pisciculture" includes the development of fisheries, both inland and marine, catching of fish and all activities connected therewith or incidental thereto;
(b) "Agricultural Refinance and Development Corporation" means the Corporation established under section 3 of the Agricultural Refinance and Development Corporation Act, 1963 (10 of 1963), and renamed under section 3A of that Act as the Agricultural Refinance and Development Corporation;
(c) "Board" means the Board of Directors of the National Bank;
(d) "central co-operative bank" means the principal co-operative society in a district in a State, the primary object of which is the financing of other co-operative societies in that district:
Provided that in addition to such principal society in a district, or where there is no such principal society in a district, the State Government may declare any one or more co-operative societies carrying on the business of financing other co-operative societies in that district to be also or to be a central co-operative bank or central co-operative banks within the meaning of this definition;
(e) "Chairman" means the Chairman 1*** appointed under section 6;
(f) "co-operative society" means a society registered, or deemed to be registered, under the Co-operative Societies Act, 1912 (2 of 1912) or any other law relating to co-operative societies for the time being in force in any State;
(g) "crops" includes products of agricultural operations;
(h) "director" means a director appointed under section 6;
2* * * * *
(j) "Managing Director" means the Managing Director appointed under section 6;
(k) "marketing of crops" includes the processing of crops prior to marketing by any agricultural producers or any organisation of such producers;
3[(ka) "micro enterprise", "small enterprise" and "medium enterprise", shall have the same meanings as are respectively assigned to them in the Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006)];
(l) "National Bank" means the National Bank for Agriculture and Rural Development established under section 3;
(m) "notification" means a notification published in the Official Gazette;
(n) "primary rural credit society" means a co-operative society, by whatever name called,--
(1) which has as its object or business the provision of financial accommodation to its members for agriculture or agricultural operations or for the marketing of crops, or for rural development; and
(2) the bye-laws of which do not permit admission of any other co-operative society as member:
Provided that this sub-clause shall not apply to the admission, as a member, of a co-operative society, which is a State co-operative bank or a central co-operative bank by reason of such bank subscribing to the share capital of the co-operative society out of funds provided by the State Government for the purpose;
(o) "prescribed" means prescribed by regulations made under this Act;
(p) "regional rural bank" means a regional rural bank established under section 3 of the Regional Rural Banks Act, 1976 (21 of 1976);
(q) "rural development" means development of rural areas through any activities conducive to such development.
Explanation.--For the purposes of this clause,--
(a) activities conducive to development of rural areas include activities relating to production of goods or provision of services in rural areas and activities for the promotion of cottage and village industries, 4[micro-enterprises, small enterprises and medium enterprises, handicrafts, handlooms] and other rural crafts;
(b) "rural area" means the area comprised in any village and includes the area comprised in any town, the population of which does not exceed ten thousand or such other figure as the Reserve Bank may specify from time to time;
(r) "Reserve Bank" means the Reserve Bank of India constituted under section 3 of the Reserve Bank of India Act, 1934 (2 of 1934);
(s) "scheduled bank" means a bank for the time being included in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934);
5* * * * *
(u) "State co-operative bank" means the principal co- operative society in a State, the primary object of which is the financing of other co-operative societies in the State:
Provided that in addition to such principal society in a State, or where there is no such principal society in a State, the State Government may declare any one or more co-operative societies carrying on business in that State to be also or to be a State co-operative bank or State co-operative banks within the meaning of this definition;
(v) "State land development bank" means the co-operative society which is the principal land development bank (by whatever name called) in a State and which has as its primary object the providing of long-term finance for agricultural development:
Provided that, in addition to such principal land development bank in a State, or where there is no such bank in a State, the State Government may declare any co-operative society carrying on business in that State and authorised by the bye-laws of such co-operative society to provide long-term finance for agricultural development to be also or to be a State land development bank within the meaning of this definition;
(w) words and expressions used herein and not defined but defined in the Reserve Bank of India Act, 1934 (2 of 1934), shall have the meanings respectively assigned to them in that Act;
(x) words and expressions used herein and not defined either in this Act or in the Reserve Bank of India Act, 1934 (2 of 1934), but defined in the Banking Regulation Act, 1949 (10 of 1949), shall have the meanings respectively assigned to them in the Banking Regulation Act, 1949.
1. The words "of the Board" omitted by Act 55 of 2000, s. 3 (w.e.f. 1-2-2001).
2. Clause (i) omitted by Act 7 of 2018, s. 3 (w.e.f. 15-3-2018).
3. Ins. by s. 3, ibid. (w.e.f. 15-3-2018).
4. Subs. by s. 3, ibid., for "industry in the tiny and decentralised sector and small-scale industry and handicrafts" (w.e.f. 15-3-2018).
5. Clause (t) omitted by Act 7 of 2018, s. 3 (w.e.f. 15-3-2018).
2. Clause (i) omitted by Act 7 of 2018, s. 3 (w.e.f. 15-3-2018).
3. Ins. by s. 3, ibid. (w.e.f. 15-3-2018).
4. Subs. by s. 3, ibid., for "industry in the tiny and decentralised sector and small-scale industry and handicrafts" (w.e.f. 15-3-2018).
5. Clause (t) omitted by Act 7 of 2018, s. 3 (w.e.f. 15-3-2018).
Section 3 Establishment and incorporation of National Bank for Agriculture and Rural Development.
(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 bank to be known as the National Bank for Agriculture and Rural Development.
(2) The 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 and be sued.
(3) The head office of the National Bank shall be at 1[Mumbai] or at such other place as the Central Government may, by notification, specify.
(4) The National Bank may establish offices, branches or agencies at any place in India, and with the previous approval of the Central Government and in consultation with the Reserve Bank, at any place outside India.
(2) The 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 and be sued.
(3) The head office of the National Bank shall be at 1[Mumbai] or at such other place as the Central Government may, by notification, specify.
(4) The National Bank may establish offices, branches or agencies at any place in India, and with the previous approval of the Central Government and in consultation with the Reserve Bank, at any place outside India.
1. Subs. by s. 4, ibid., for "Bombay" (w.e.f. 15-3-2018).
Section 4 Capital.
(1) The capital of the National Bank shall be one hundred crores of rupees:
1[Provided that the Central Government may, by notification, increase the said capital up to thirty thousand crore rupees:
Provided further that the Central Government may, in consultation with the Reserve Bank and by notification, further increase the said capital to such amount as it may deem necessary from time to time].
2[(2) The capital of the National Bank which has been subscribed to by the Reserve Bank valued at twenty crore rupees as on the date immediately preceding the commencement of the National Bank for Agriculture and Rural Development (Amendment) Act, 2018 shall, on such commencement, stand transferred to, and vested in, the Central Government:
Provided that the National Bank may issue capital to such institutions and persons in such manner as may be notified by the Central Government:
Provided further that the combined shareholding of the Central Government and the Reserve Bank shall not at any time be less than fifty-one per cent. of the total subscribed capital.
(3) The Central Government shall give to the Reserve Bank an amount equal to the face value of the subscribed capital, valued at twenty crores of rupees, referred to in sub-section (2), in cash, for transfer to, and vesting in the Central Government of the capital of the National Bank which has been so subscribed to by the said Bank.]
1[Provided that the Central Government may, by notification, increase the said capital up to thirty thousand crore rupees:
Provided further that the Central Government may, in consultation with the Reserve Bank and by notification, further increase the said capital to such amount as it may deem necessary from time to time].
2[(2) The capital of the National Bank which has been subscribed to by the Reserve Bank valued at twenty crore rupees as on the date immediately preceding the commencement of the National Bank for Agriculture and Rural Development (Amendment) Act, 2018 shall, on such commencement, stand transferred to, and vested in, the Central Government:
Provided that the National Bank may issue capital to such institutions and persons in such manner as may be notified by the Central Government:
Provided further that the combined shareholding of the Central Government and the Reserve Bank shall not at any time be less than fifty-one per cent. of the total subscribed capital.
(3) The Central Government shall give to the Reserve Bank an amount equal to the face value of the subscribed capital, valued at twenty crores of rupees, referred to in sub-section (2), in cash, for transfer to, and vesting in the Central Government of the capital of the National Bank which has been so subscribed to by the said Bank.]
1. The proviso subs by s. 5, ibid. (w.e.f. 15-3-2018).
2. Subs by Act 7 of 2018, s. 5, for sub-section (2) (w.e.f. 15-3-2018).
2. Subs by Act 7 of 2018, s. 5, for sub-section (2) (w.e.f. 15-3-2018).
Section 5 Management.
(1) The general superintendence, direction and management of the affairs and business of the National Bank shall vest in a Board of Directors, which shall exercise all powers and do all acts and things which may be exercised or done by the National Bank.
(2) Subject to the provisions of this Act, the Board in discharging its functions, shall act on business principles with due regard to public interest.
(3) Subject to the provisions of sub-section (1) and save as otherwise provided in the regulations made under this Act, the Managing Director shall also have powers of general superintendence, direction and management of the affairs and business of the National Bank and may also exercise all powers and do all acts and things which may be exercised or done by the National Bank:
1[Provided that during the period of any casual vacancy of the nature referred to in section 11 in the office of the Managing Director, the Chairman may also exercise the powers and discharge the functions of the Managing Director until the person appointed by the Central Government under section 11 to act as Managing Director enters upon his office.]
(4) Any whole-time director appointed under sub-section (3) of section 6 shall assist the Managing Director in the discharge of his functions under sub-section (3) and perform such duties as the Board may entrust or delegate to him.
(5) In the discharge of his powers and functions under sub-section (3), the Managing Director shall follow such directions as the Chairman may give.
(6) In the discharge of its functions under this Act, the National Bank shall be guided by such directions in matters of policy involving public interest as the Central Government, in consultation with the Reserve Bank, or the Reserve Bank, may give in writing.
(2) Subject to the provisions of this Act, the Board in discharging its functions, shall act on business principles with due regard to public interest.
(3) Subject to the provisions of sub-section (1) and save as otherwise provided in the regulations made under this Act, the Managing Director shall also have powers of general superintendence, direction and management of the affairs and business of the National Bank and may also exercise all powers and do all acts and things which may be exercised or done by the National Bank:
1[Provided that during the period of any casual vacancy of the nature referred to in section 11 in the office of the Managing Director, the Chairman may also exercise the powers and discharge the functions of the Managing Director until the person appointed by the Central Government under section 11 to act as Managing Director enters upon his office.]
(4) Any whole-time director appointed under sub-section (3) of section 6 shall assist the Managing Director in the discharge of his functions under sub-section (3) and perform such duties as the Board may entrust or delegate to him.
(5) In the discharge of his powers and functions under sub-section (3), the Managing Director shall follow such directions as the Chairman may give.
(6) In the discharge of its functions under this Act, the National Bank shall be guided by such directions in matters of policy involving public interest as the Central Government, in consultation with the Reserve Bank, or the Reserve Bank, may give in writing.
1. Ins. by Act 66 of 1988, s. 43 (w.e.f. 30-12-1988).
Section 6 Board of Directors.
1[(1) The Board of Directors of the National Bank shall consist of the following, namely:--
(a) a Chairman;
(b) three directors from amongst experts in rural economics, rural development, village and cottage industries, 2[micro-enterprises, small-scale industries] or persons having experience in the working of co-operative banks, regional rural banks or commercial banks or any other matter the special knowledge or professional experience in which is considered by the Central Government as useful to the National Bank;
(c) three directors from out of the directors of the Reserve Bank;
(d) three directors from amongst the officials of the Central Government;
(e) four directors from amongst the officials of the State Governments;
(f) such number of directors elected in the prescribed manner, by shareholders other than the Reserve Bank, the Central Government and other institutions owned or controlled by the Central Government whose names are entered on the register of shareholders of the National Bank ninety days before the date of the meeting in which such election takes place on the following basis, namely:--
(i) where the total amount of equit.................................................. share capital issued to such shareholders is ten per cent. or less of the total issued equity capital two directors;
(ii) where the total amount of equity................................................ share capital issued to such shareholders is more than ten per cent. but less than twenty-five per cent. of the total issued equity capital three directors; and
(iii) where the total equity share capital......................................... issued to such shareholders is twenty-five per cent. or more of the total issued equity capital: four directors:
Provided that until the assumption of charge by the elected directors under this clause, the Central Government may at any time nominate such number of directors not exceeding four from amongst persons having special knowledge of, and professional experience in, agricultural science, technology, economics, banking, co-operatives, law, rural finance, investment, accountancy, marketing or any other matter, the special knowledge of, and professional experience in, which would, in the opinion of the Central Government, be useful to the National Bank for carrying out its functions; and
(g) a Managing Director.
(2) The Chairman and other directors, excluding the directors referred to in clause (f), shall be appointed by the Central Government in consultation with the Reserve Bank:
Provided that no such consultation shall be necessary in the case of directors appointed under clause (d) of sub-section (1).
(3) Where the Central Government is satisfied, in consultation with the Reserve Bank, 3*** that it is necessary so to do, it may appoint one or more whole-time directors with such designations as may be deemed appropriate by that Government and any whole-time director so appointed shall also be a member of the Board.
4* * * * *
(a) a Chairman;
(b) three directors from amongst experts in rural economics, rural development, village and cottage industries, 2[micro-enterprises, small-scale industries] or persons having experience in the working of co-operative banks, regional rural banks or commercial banks or any other matter the special knowledge or professional experience in which is considered by the Central Government as useful to the National Bank;
(c) three directors from out of the directors of the Reserve Bank;
(d) three directors from amongst the officials of the Central Government;
(e) four directors from amongst the officials of the State Governments;
(f) such number of directors elected in the prescribed manner, by shareholders other than the Reserve Bank, the Central Government and other institutions owned or controlled by the Central Government whose names are entered on the register of shareholders of the National Bank ninety days before the date of the meeting in which such election takes place on the following basis, namely:--
(i) where the total amount of equit.................................................. share capital issued to such shareholders is ten per cent. or less of the total issued equity capital two directors;
(ii) where the total amount of equity................................................ share capital issued to such shareholders is more than ten per cent. but less than twenty-five per cent. of the total issued equity capital three directors; and
(iii) where the total equity share capital......................................... issued to such shareholders is twenty-five per cent. or more of the total issued equity capital: four directors:
Provided that until the assumption of charge by the elected directors under this clause, the Central Government may at any time nominate such number of directors not exceeding four from amongst persons having special knowledge of, and professional experience in, agricultural science, technology, economics, banking, co-operatives, law, rural finance, investment, accountancy, marketing or any other matter, the special knowledge of, and professional experience in, which would, in the opinion of the Central Government, be useful to the National Bank for carrying out its functions; and
(g) a Managing Director.
(2) The Chairman and other directors, excluding the directors referred to in clause (f), shall be appointed by the Central Government in consultation with the Reserve Bank:
Provided that no such consultation shall be necessary in the case of directors appointed under clause (d) of sub-section (1).
(3) Where the Central Government is satisfied, in consultation with the Reserve Bank, 3*** that it is necessary so to do, it may appoint one or more whole-time directors with such designations as may be deemed appropriate by that Government and any whole-time director so appointed shall also be a member of the Board.
4* * * * *
1. Subs. by Act 55 of 2000, s. 5, for sub-sections (1) and (2) (w.e.f. 1-2-2001).
2. Subs. by Act 7 of 2018, s. 6, for "small-scale industries" (w.e.f. 15-3-2018).
3. The words "and the Board" omitted by Act 81 of 1985, s. 17(w.e.f. 1-5-1986).
4. The proviso omitted by s. 17, ibid. (w.e.f. 1-5-1986).
2. Subs. by Act 7 of 2018, s. 6, for "small-scale industries" (w.e.f. 15-3-2018).
3. The words "and the Board" omitted by Act 81 of 1985, s. 17(w.e.f. 1-5-1986).
4. The proviso omitted by s. 17, ibid. (w.e.f. 1-5-1986).
Section 7 Term of office of Chairman and other directors, retirement and payment of fees.
(1) The Chairman shall hold office for such term not exceeding five years and shall receive such salary and allowances as the Central Government may, at the time of appointment, specify 1[and shall be eligible for reappointment]:
2* * * * *
3[(1A) Notwithstanding anything contained in sub-section (1), the Central Government shall have the right to terminate the term of office of the Chairman at any time before the expiry of the term specified under that sub-section by giving him a notice of not less than three months in writing or three months salary and allowances in lieu of such notice.]
4[(1B) In the case of a vacancy in the office of the Chairman, the Managing Director shall perform the functions and duties of the Chairman during such vacancy.]
5[(2) Subject to the provisions contained in sub-section (5), a director appointed under clause (b) or clause (c) of sub-section (1) of section 6, shall hold office for such term, not exceeding three years, as the Central Government may specify in this behalf, 6*** and shall be eligible for reappointment:
Provided that no such director shall hold office continuously for a period exceeding six years.]
(3) The Central Government may, in consultation with the Reserve Bank, remove the Chairman at any time before the expiry of his term of office after giving him a reasonable opportunity of showing cause against the proposed removal.
7[(4) The Chairman and any other director, who is not an officer of the Central Government or a State State Government or an officer of the Reserve Bank or any body or corporation established by or under any Central Act or any State Act and owned or controlled by such Government, shall be paid such fees and allowances as may be prescribed for attending the meetings of the Board or of any of its committees and for attending to any other work of the National Bank.]
8[(5) The directors appointed under clauses (b) to (f) of sub-section (1) of section 6 shall hold office during the pleasure of the Central Government.]
2* * * * *
3[(1A) Notwithstanding anything contained in sub-section (1), the Central Government shall have the right to terminate the term of office of the Chairman at any time before the expiry of the term specified under that sub-section by giving him a notice of not less than three months in writing or three months salary and allowances in lieu of such notice.]
4[(1B) In the case of a vacancy in the office of the Chairman, the Managing Director shall perform the functions and duties of the Chairman during such vacancy.]
5[(2) Subject to the provisions contained in sub-section (5), a director appointed under clause (b) or clause (c) of sub-section (1) of section 6, shall hold office for such term, not exceeding three years, as the Central Government may specify in this behalf, 6*** and shall be eligible for reappointment:
Provided that no such director shall hold office continuously for a period exceeding six years.]
(3) The Central Government may, in consultation with the Reserve Bank, remove the Chairman at any time before the expiry of his term of office after giving him a reasonable opportunity of showing cause against the proposed removal.
7[(4) The Chairman and any other director, who is not an officer of the Central Government or a State State Government or an officer of the Reserve Bank or any body or corporation established by or under any Central Act or any State Act and owned or controlled by such Government, shall be paid such fees and allowances as may be prescribed for attending the meetings of the Board or of any of its committees and for attending to any other work of the National Bank.]
8[(5) The directors appointed under clauses (b) to (f) of sub-section (1) of section 6 shall hold office during the pleasure of the Central Government.]
1. Added by Act 55 of 2000, s. 6 (w.e.f. 1-2-2001).
2. The proviso omitted by Act 81 of 1985, s.18 (w.e.f. 1-5-1986).
3. Ins. by s. 18, ibid. (1-5-1986).
4. Ins. by Act 55 of 2000, s. 6 (w.e.f. 1-2-2001).
5. Subs. by Act 66 of 1988, s. 45, for sub-section (2) (w.e.f. 30-12-1988).
6. The words "and thereafter until his successor enters upon his office" omitted by Act 55 of 2000, s. 6 (w.e.f. 1-2-2001).
7. Subs. by Act 55 of 2000, s. 6, for sub-section (4) (w.e.f. 1-2-2001).
8. Ins. by Act 66 of 1988, s. 45 (w.e.f. 30-12-1988).
2. The proviso omitted by Act 81 of 1985, s.18 (w.e.f. 1-5-1986).
3. Ins. by s. 18, ibid. (1-5-1986).
4. Ins. by Act 55 of 2000, s. 6 (w.e.f. 1-2-2001).
5. Subs. by Act 66 of 1988, s. 45, for sub-section (2) (w.e.f. 30-12-1988).
6. The words "and thereafter until his successor enters upon his office" omitted by Act 55 of 2000, s. 6 (w.e.f. 1-2-2001).
7. Subs. by Act 55 of 2000, s. 6, for sub-section (4) (w.e.f. 1-2-2001).
8. Ins. by Act 66 of 1988, s. 45 (w.e.f. 30-12-1988).
Section 8 Term of office of Managing Director and whole-time directors, conditions of service, etc.
(1) The Managing Director and any whole-time director appointed under sub-section (3) of section 6 shall,--
(a) hold office for such term not exceeding five years as the Central Government may, at the time of appointment, specify 1[and shall be eligible for reappointment];
(b) receive such salary and allowances and be governed by such terms and conditions of service as the Board may, with the previous approval of the Central Government and in consultation with the Reserve Bank, determine:
Provided that the Managing Director and any such whole-time director appointed to the first Board shall receive such salary and allowances and be governed by such terms and conditions of service as the Central Government may, in consultation with the Reserve Bank, determine.
(2) The Central Government may, in consultation with the Reserve Bank, remove the Managing Director or any whole-time director appointed under sub-section (3) of section 6 at any time before the expiry of his term of office, after giving him a reasonable opportunity of showing cause against the proposed removal.
(3) Notwithstanding anything contained in sub-section (1) or sub-section (2), the Central Government shall have the right to terminate the term of office of the Managing Director or of any whole-time director appointed under sub-section (3) of section 6 at any time before the expiry of the term fixed under sub-section (1) by giving him notice of not less than three months in writing or three months' salary and allowances in lieu of such notice:
Provided that the Central Government shall, before terminating the term of office of the Managing Director or any whole-time director appointed under sub-section (3) of section 6, consult the Reserve Bank.
(a) hold office for such term not exceeding five years as the Central Government may, at the time of appointment, specify 1[and shall be eligible for reappointment];
(b) receive such salary and allowances and be governed by such terms and conditions of service as the Board may, with the previous approval of the Central Government and in consultation with the Reserve Bank, determine:
Provided that the Managing Director and any such whole-time director appointed to the first Board shall receive such salary and allowances and be governed by such terms and conditions of service as the Central Government may, in consultation with the Reserve Bank, determine.
(2) The Central Government may, in consultation with the Reserve Bank, remove the Managing Director or any whole-time director appointed under sub-section (3) of section 6 at any time before the expiry of his term of office, after giving him a reasonable opportunity of showing cause against the proposed removal.
(3) Notwithstanding anything contained in sub-section (1) or sub-section (2), the Central Government shall have the right to terminate the term of office of the Managing Director or of any whole-time director appointed under sub-section (3) of section 6 at any time before the expiry of the term fixed under sub-section (1) by giving him notice of not less than three months in writing or three months' salary and allowances in lieu of such notice:
Provided that the Central Government shall, before terminating the term of office of the Managing Director or any whole-time director appointed under sub-section (3) of section 6, consult the Reserve Bank.
1. Added by Act 55 of 2000, s. 7 (w.e.f. 1-2-2001).
Section 9 Disqualifications.
(1) No person shall be a director who--
(a) is of unsound mind and stands so declared by a competent court; or
(b) is or has been convicted of any offence which, in the opinion of the Central Government, involves moral turpitude; or
(c) is, or at any time has been, adjudicated insolvent or has suspended payment of his debts or has compounded with his creditors.
(2) The appointment as director of any person who is a Member of Parliament or the Legislature of any State shall, unless within two months of the date of his appointment he ceases to be such member, be void on the expiry of the said period of two months and if any director is elected or nominated as a Member of Parliament or of any State Legislature he shall cease to be a director as from the date of such election or nomination, as the case may be.
(a) is of unsound mind and stands so declared by a competent court; or
(b) is or has been convicted of any offence which, in the opinion of the Central Government, involves moral turpitude; or
(c) is, or at any time has been, adjudicated insolvent or has suspended payment of his debts or has compounded with his creditors.
(2) The appointment as director of any person who is a Member of Parliament or the Legislature of any State shall, unless within two months of the date of his appointment he ceases to be such member, be void on the expiry of the said period of two months and if any director is elected or nominated as a Member of Parliament or of any State Legislature he shall cease to be a director as from the date of such election or nomination, as the case may be.
Section 10 Vacation and resignation of office by directors.
(1) If a director--
(a) becomes subject to any of the disqualifications mentioned in section 9; or
(b) is absent without leave of the Board for more than three consecutive meetings thereof,
his seat shall thereupon become vacant.
(2) Any director may resign his office by giving notice thereof in writing to the Central Government, and on his resignation being accepted by the Central Government or if his resignation is not sooner accepted, on the expiry of three months from the receipt thereof by the Central Government, he shall be deemed to have vacated his office.
(a) becomes subject to any of the disqualifications mentioned in section 9; or
(b) is absent without leave of the Board for more than three consecutive meetings thereof,
his seat shall thereupon become vacant.
(2) Any director may resign his office by giving notice thereof in writing to the Central Government, and on his resignation being accepted by the Central Government or if his resignation is not sooner accepted, on the expiry of three months from the receipt thereof by the Central Government, he shall be deemed to have vacated his office.
Section 11 Casual vacancy in the office of Managing Director.
If the Managing Director is by infirmity or otherwise rendered incapable of carrying out his duties or is absent on leave or otherwise, in circumstances not involving the vacation of his appointment, the Central Government may, after consultation with the Reserve Bank and the Board, appoint another person to act in his place as Managing Director during his absence.
Section 12 Meetings of Board.
(1) The Board shall meet at such times and places and shall observe such rules of procedure in regard to the transaction of business at its meetings as may be prescribed.
(2) The Chairman of the Board, or, if for any reason he is unable to attend any meeting, 1[the Managing Director and in the absence of both, the Chairman and the Managing Director] any other director nominated by the Chairman in this behalf, and in the absence of such nomination, any other director elected by the directors present at the meeting, shall preside at the meeting of the Board.
(3) All questions which come up before any meeting of the Board shall be decided by a majority of votes of the directors present and voting, and in the event of an equality of votes, the Chairman, or, in his absence, the person presiding, shall have a second or casting vote.
(2) The Chairman of the Board, or, if for any reason he is unable to attend any meeting, 1[the Managing Director and in the absence of both, the Chairman and the Managing Director] any other director nominated by the Chairman in this behalf, and in the absence of such nomination, any other director elected by the directors present at the meeting, shall preside at the meeting of the Board.
(3) All questions which come up before any meeting of the Board shall be decided by a majority of votes of the directors present and voting, and in the event of an equality of votes, the Chairman, or, in his absence, the person presiding, shall have a second or casting vote.
1. ns. by Act 55 of 2000, s. 8 (w.e.f. 1-2-2001).
Section 13 Committees of National Bank.
(1) The Board may constitute an Executive Committee consisting of such number of directors as may be prescribed.
(2) The Executive Committee shall discharge such functions as may be prescribed or may be delegated to it by the Board.
(3) The Board may constitute such other committees, whether consisting wholly of directors or wholly of other persons or partly of directors and partly of other persons as it thinks fit and for such purposes as it may decide and every committee so constituted shall discharge such functions as may be delegated to it by the Board.
(4) The Executive Committee shall meet at such times and places and shall observe such rules of procedure in regard to the transaction of business at its meetings, as may be prescribed.
(5) The times and places at which any committee constituted under sub-section (3) shall meet, the rules of procedure which such committee shall observe in regard to the transaction of business at its meetings, and the fees and allowances which may be paid to the members of such committee for attending the meetings of the committee and for attending to any other work of the National Bank shall be such as may be specified by that Bank.
(2) The Executive Committee shall discharge such functions as may be prescribed or may be delegated to it by the Board.
(3) The Board may constitute such other committees, whether consisting wholly of directors or wholly of other persons or partly of directors and partly of other persons as it thinks fit and for such purposes as it may decide and every committee so constituted shall discharge such functions as may be delegated to it by the Board.
(4) The Executive Committee shall meet at such times and places and shall observe such rules of procedure in regard to the transaction of business at its meetings, as may be prescribed.
(5) The times and places at which any committee constituted under sub-section (3) shall meet, the rules of procedure which such committee shall observe in regard to the transaction of business at its meetings, and the fees and allowances which may be paid to the members of such committee for attending the meetings of the committee and for attending to any other work of the National Bank shall be such as may be specified by that Bank.
Section 14 Advisory Council.
(1) 1[The Board may] constitute an Advisory Council consisting of such number of directors and such other persons who, in the opinion of the Board, have special knowledge of agriculture, agricultural credit, co-operation and rural economics, 2[micro-enterprises, small-scale industries,] village and cottage industries and handicrafts and other rural crafts or have special knowledge and appreciation of the country's overall developmental policies and in particular overall monetary and credit policies, which is considered by the Board as useful to the National Bank.
(2) The Advisory Council shall advise the National Bank in such matters as may be referred to the Advisory Council by the National Bank and may discharge such other functions as may be entrusted or delegated to the Advisory Council by the National Bank.
(3) A member of the Advisory Council shall hold office for such term not exceeding five years as the National Bank may fix, and receive such fees and allowances as may be prescribed for attending the meetings of the Advisory Council and for attending to any other work of the National Bank.
(4) The Advisory Council shall meet at such times and places and shall observe such rules of procedure in regard to transaction of business at its meetings as may be prescribed.
(2) The Advisory Council shall advise the National Bank in such matters as may be referred to the Advisory Council by the National Bank and may discharge such other functions as may be entrusted or delegated to the Advisory Council by the National Bank.
(3) A member of the Advisory Council shall hold office for such term not exceeding five years as the National Bank may fix, and receive such fees and allowances as may be prescribed for attending the meetings of the Advisory Council and for attending to any other work of the National Bank.
(4) The Advisory Council shall meet at such times and places and shall observe such rules of procedure in regard to transaction of business at its meetings as may be prescribed.
1. Subs. by 55 of 2000, s. 9, for The Board shall (w.e.f. 1-2-2001).
2. Subs. by Act 7 of 2018, s. 7, for "small-scale industries" (w.e.f. 15-3-2018).
2. Subs. by Act 7 of 2018, s. 7, for "small-scale industries" (w.e.f. 15-3-2018).
Section 15 Member of Board or Committee thereof not to participate in meetings in certain cases.
A director of the Board or a member of a Committee, who has any direct or indirect pecuniary interest in any matter coming up for consideration at a meeting of the Board or a Committee thereof, shall, as soon as possible after relevant circumstances have come to his knowledge, disclose the nature of his interest at such meeting, and the disclosure shall be recorded in the minutes of the Board, or the Committee, as the case may be, and the director or member shall not take any part in any deliberation or decision of the Board or the Committee with respect to that matter.
Section 16 Transfer of assets and liabilities of Agricultural Refinance and Development Corporation.
(1) On such date as the Central Government, in consultation with the Reserve Bank may, by notification, appoint, the entire undertaking of the Agricultural Refinance and Development Corporation (hereafter in this Chapter referred to as the "Corporation") including all business, property, assets and liabilities, rights, interests, privileges and obligations of whatever nature, shall stand transferred to and vest in the National Bank.
(2) As compensation for the transfer of the undertaking of the Corporation to the National Bank under sub-section (1), the National Bank shall within six months from the date appointed under that sub-section (hereafter in this section referred to as the appointed date) pay to the shareholders of the Corporation a sum equal to the total paid-up capital of the Corporation as on the date immediately preceding the appointed date.
(3) The amount of compensation payable under sub-section (2) to the shareholders of the Corporation shall be apportioned among the shareholders in proportion to their contributions to the paid-up capital of the Corporation as on the date immediately preceding the appointed date.
Explanation.--For the purposes of this sub-section, "shareholders of the Corporation" means shareholders of the Corporation whose names appear on the register of shareholders maintained under section 8 of the Agricultural Refinance and Development Corporation Act, 1963 (10 of 1963), on the date immediately preceding the appointed date.
(4) The National Bank shall also pay to the shareholders of the Corporation referred to in sub-section (2) an amount calculated at the rate at which the shares of the Corporation were guaranteed as to the payment of minimum divided under section 6 of the Agricultural Refinance and Development Corporation Act, 1963 (10 of 1963), for the period, if any, that has expired in the accounting year of the Corporation before the appointed date and this amount the National Bank shall distribute to the shareholders of the Corporation referred to in sub-section (2) in proportion to the shares held by such shareholders on the date immediately preceding the appointed date and at the rate at which such shares were guaranteed as to the payment of minimum dividend.
(5) 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 date and to which the Corporation is a party, or which are in favour of the Corporation, shall be of as full force and effect against or in favour of the National Bank, as the case may be, and may be enforced or acted upon as fully and effectually as if instead of the Corporation the National Bank had been a party thereto, or as if they had been in favour of the National Bank.
(6) If, immediately before the appointed date, any suit, appeal or other legal proceeding of whatever nature, is pending, by or against the Corporation, the same shall not abate, be discontinued or be in any way prejudicially affected by reason of the transfer to the National Bank of the undertaking of the Corporation, or of anything contained in this Act, but the suit, appeal or other proceeding may be continued, prosecuted and enforced, by or against the National Bank.
(2) As compensation for the transfer of the undertaking of the Corporation to the National Bank under sub-section (1), the National Bank shall within six months from the date appointed under that sub-section (hereafter in this section referred to as the appointed date) pay to the shareholders of the Corporation a sum equal to the total paid-up capital of the Corporation as on the date immediately preceding the appointed date.
(3) The amount of compensation payable under sub-section (2) to the shareholders of the Corporation shall be apportioned among the shareholders in proportion to their contributions to the paid-up capital of the Corporation as on the date immediately preceding the appointed date.
Explanation.--For the purposes of this sub-section, "shareholders of the Corporation" means shareholders of the Corporation whose names appear on the register of shareholders maintained under section 8 of the Agricultural Refinance and Development Corporation Act, 1963 (10 of 1963), on the date immediately preceding the appointed date.
(4) The National Bank shall also pay to the shareholders of the Corporation referred to in sub-section (2) an amount calculated at the rate at which the shares of the Corporation were guaranteed as to the payment of minimum divided under section 6 of the Agricultural Refinance and Development Corporation Act, 1963 (10 of 1963), for the period, if any, that has expired in the accounting year of the Corporation before the appointed date and this amount the National Bank shall distribute to the shareholders of the Corporation referred to in sub-section (2) in proportion to the shares held by such shareholders on the date immediately preceding the appointed date and at the rate at which such shares were guaranteed as to the payment of minimum dividend.
(5) 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 date and to which the Corporation is a party, or which are in favour of the Corporation, shall be of as full force and effect against or in favour of the National Bank, as the case may be, and may be enforced or acted upon as fully and effectually as if instead of the Corporation the National Bank had been a party thereto, or as if they had been in favour of the National Bank.
(6) If, immediately before the appointed date, any suit, appeal or other legal proceeding of whatever nature, is pending, by or against the Corporation, the same shall not abate, be discontinued or be in any way prejudicially affected by reason of the transfer to the National Bank of the undertaking of the Corporation, or of anything contained in this Act, but the suit, appeal or other proceeding may be continued, prosecuted and enforced, by or against the National Bank.
Section 17 Dissolution of the Corporation and repeal of Act 10 of 1963.
On the date appointed under sub-section (1) of section 16,--
(a) the Corporation shall stand dissolved; and
(b) the Agricultural Refinance and Development Corporation Act, 1963, shall stand repealed.
(a) the Corporation shall stand dissolved; and
(b) the Agricultural Refinance and Development Corporation Act, 1963, shall stand repealed.
Section 18 Transfer of business from Reserve Bank.
(1) On such date as the Central Government may, in consultation with the Reserve Bank, by notification, appoint, the assets and liabilities with the Reserve Bank relating to--
(a) the National Agricultural Credit (Long Term Operations) Fund established and maintained under section 46A of the Reserve Bank of India Act, 1934 (2 of 1934); and
(b) the National Agricultural Credit (Stabilisation) Fund established and maintained under section 46B of the Reserve Bank of India Act, 1934 (2 of 1934),
shall stand transferred to the National Bank and form part of the National Rural Credit (Long Term Operations) Fund referred to in section 42 and the National Rural Credit (Stabilisation) Fund referred to in section 43, respectively.
(2) With effect from such date as the Central Government may, in consultation with the Reserve Bank, by notification, appoint, the loans and advances which the Reserve Bank has granted to State co-operative banks and regional rural banks under section 17 [except sub-clause (a) of clause (4) of the Reserve Bank of India Act, 1934 (2 of 1934), and which the Reserve Bank may specify by a general or special order, shall, as far as may be, become and be deemed to be loans and advances granted by the National Bank under section 21, and the National Bank shall repay to the Reserve Bank, the amount of such loans and advances on such terms and conditions as the Central Government may specify, in consultation with the Reserve Bank.
(3) All rights, liabilities interests, privileges and obligations of whatever nature (including the rights and obligations arising by way of purchase, sale and rediscount of any bills of exchange and promissory notes) of the Reserve Bank in relation to any asset or liability referred to in sub-section (1) or any loan or advance referred to in sub-section (2) shall stand transferred to and vest in the National Bank on the date on which such asset or liability stands transferred to the National Bank under sub-section (1) or, as the case may be, such loan or advance becomes under sub-section (2) a loan or advance granted by the National Bank.
(4) All contracts, deeds, bonds, agreements, powers of attorney, grants of legal representation and other instruments of whatever nature relating to any asset or liability referred to in sub-section (1) and subsisting or having effect immediately before the date appointed under that sub-section or relating to any loan or advance referred to in sub-section (2) and subsisting or having effect immediately before the date appointed under that sub-section shall be of as full force and effect against, or in favour of, the National Bank, as the case may be, and may be enforced or acted upon as fully and effectually as if instead of the Reserve Bank, the National Bank had been a party thereto, or as if they had been in favour of the National Bank.
(5) If, immediately before the date appointed under sub-section (1) or sub-section (2), as the case may be, any suit, appeal or other legal proceedings of whatever nature relating to any asset or liability referred to in sub-section (1) or any loan or advance referred to in sub-section (2) is pending, by or against the Reserve Bank, the same shall not abate, be discontinued, or be in any way prejudicially affected by reason of the transfer to the National Bank of such asset or liability under sub-section (1), or as the case may be, such loan or advance becoming under sub-section (2) a loan or advance granted by the National Bank, or of anything contained in this Act, but the suit, appeal or other proceedings may be continued, prosecuted and enforced, by or against the National Bank.
(a) the National Agricultural Credit (Long Term Operations) Fund established and maintained under section 46A of the Reserve Bank of India Act, 1934 (2 of 1934); and
(b) the National Agricultural Credit (Stabilisation) Fund established and maintained under section 46B of the Reserve Bank of India Act, 1934 (2 of 1934),
shall stand transferred to the National Bank and form part of the National Rural Credit (Long Term Operations) Fund referred to in section 42 and the National Rural Credit (Stabilisation) Fund referred to in section 43, respectively.
(2) With effect from such date as the Central Government may, in consultation with the Reserve Bank, by notification, appoint, the loans and advances which the Reserve Bank has granted to State co-operative banks and regional rural banks under section 17 [except sub-clause (a) of clause (4) of the Reserve Bank of India Act, 1934 (2 of 1934), and which the Reserve Bank may specify by a general or special order, shall, as far as may be, become and be deemed to be loans and advances granted by the National Bank under section 21, and the National Bank shall repay to the Reserve Bank, the amount of such loans and advances on such terms and conditions as the Central Government may specify, in consultation with the Reserve Bank.
(3) All rights, liabilities interests, privileges and obligations of whatever nature (including the rights and obligations arising by way of purchase, sale and rediscount of any bills of exchange and promissory notes) of the Reserve Bank in relation to any asset or liability referred to in sub-section (1) or any loan or advance referred to in sub-section (2) shall stand transferred to and vest in the National Bank on the date on which such asset or liability stands transferred to the National Bank under sub-section (1) or, as the case may be, such loan or advance becomes under sub-section (2) a loan or advance granted by the National Bank.
(4) All contracts, deeds, bonds, agreements, powers of attorney, grants of legal representation and other instruments of whatever nature relating to any asset or liability referred to in sub-section (1) and subsisting or having effect immediately before the date appointed under that sub-section or relating to any loan or advance referred to in sub-section (2) and subsisting or having effect immediately before the date appointed under that sub-section shall be of as full force and effect against, or in favour of, the National Bank, as the case may be, and may be enforced or acted upon as fully and effectually as if instead of the Reserve Bank, the National Bank had been a party thereto, or as if they had been in favour of the National Bank.
(5) If, immediately before the date appointed under sub-section (1) or sub-section (2), as the case may be, any suit, appeal or other legal proceedings of whatever nature relating to any asset or liability referred to in sub-section (1) or any loan or advance referred to in sub-section (2) is pending, by or against the Reserve Bank, the same shall not abate, be discontinued, or be in any way prejudicially affected by reason of the transfer to the National Bank of such asset or liability under sub-section (1), or as the case may be, such loan or advance becoming under sub-section (2) a loan or advance granted by the National Bank, or of anything contained in this Act, but the suit, appeal or other proceedings may be continued, prosecuted and enforced, by or against the National Bank.
Section 19 Borrowings by the National Bank.
The National Bank may, for the purpose of carrying out its functions under this Act,--
1[(a) issue and sell bonds, debentures and other financial instruments with or without guarantee of the Central Government on such terms and conditions as may be approved by the Board;]
2[(b) borrow money from the Reserve Bank repayable on demand or otherwise on such terms and conditions including the terms relating to security and purposes as may be specified by the Reserve Bank;
(c) borrow money from the Central Government and from any other authority or organisation or institution approved by the Board, on such terms and conditions as may be agreed upon;
(d) accept from the Central Government, a State Government, a local authority, a State land development bank, a State co-operative bank or a scheduled bank or any person or body, whether incorporated or not, deposits repayable on such terms as the National Bank may, with the approval of the Reserve Bank, fix; and
(e) receive gifts, grants, donations or benefactions from the Central Government or any State Government or any other source.]
1[(a) issue and sell bonds, debentures and other financial instruments with or without guarantee of the Central Government on such terms and conditions as may be approved by the Board;]
2[(b) borrow money from the Reserve Bank repayable on demand or otherwise on such terms and conditions including the terms relating to security and purposes as may be specified by the Reserve Bank;
(c) borrow money from the Central Government and from any other authority or organisation or institution approved by the Board, on such terms and conditions as may be agreed upon;
(d) accept from the Central Government, a State Government, a local authority, a State land development bank, a State co-operative bank or a scheduled bank or any person or body, whether incorporated or not, deposits repayable on such terms as the National Bank may, with the approval of the Reserve Bank, fix; and
(e) receive gifts, grants, donations or benefactions from the Central Government or any State Government or any other source.]
1. Subs. by Act 55 of 2000, s. 10, for clause (a) (w.e.f. 26-9-2000).
2. Subs. by s. 10, ibid., for clauses (b) to (e) (w.e.f. 26-9-2000).
2. Subs. by s. 10, ibid., for clauses (b) to (e) (w.e.f. 26-9-2000).
Section 20 Borrowings in foreign currency.
1[20. Borrowings in foreign currency.-- (1) Notwithstanding anything contained in the Foreign Exchange Management Act, 1999 (42 of 1999), or in any other law for the time being in force, relating to foreign exchange, the National Bank may borrow, with the previous approval of the Central Government and in consultation with the Reserve Bank, foreign currency from any bank or financial institution in India or elsewhere, for granting loans and advances or for utilising such currency for any other purpose specified under the provisions of this Act.]
1. Subs. by s. 11, ibid., for section 20 (w.e.f. 1-2-2001).