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Section 5 – The State Agricultural Credit Corporations Act,1968

The State Agricultural Credit Corporations Act,1968

Section 5. Share capital and share holders

(1) The authorised capital of each Corporation shall be such sum as the appropriate Government may initially fix but it shall, in no case, be less than one crore rupees or more than five crores of rupees;

Provided that where the authorised capital initially fixed is less than five crores of rupees, the appropriate Government may, from time to time, increase the authorised capital to such sum not exceeding five crores of rupees.

Provided further that where the appropriate Government is not the Central Government, the initial fixation of the authorised capital and any subsequent increase or reduction thereof, shall be made with the prior approval of the Central Government

(2) The authorised capital of each Corporation shall be divided into such number of shares as the appropriate Government may determine and shall be issued as fully paid-up shares to the parties mentioned in sub-section (3) at such times and in such manner and to such extent as the appropriate Government may determine and each of such shares shall have the same face value.

(3) Out of the capital issued under sub-section (2)–

(a) In the case of a Corporation established in a State, the Central Government shall subscribe for thirty percent of the share capital, and in the case of a Corporation shall subscribe for fifty percent of the share capital;

(b) The Reserve Bank shall subscribe for twenty per cent of the share capital;

Provided that none of the said parties shall subscribe for more than fifteen per cent, of the share capital.

(4) The parties referred to in sub-section (3) shall subscribe for the shares before such date as may be specified in this behalf by the Central Government by notification in the Official Gazette.

(5) Subject to the provisions of sub-section (3), the Central Government shall determine the number of shares which are to be allotted to the parties referred to in clause (d) of that sub-section;

Provided that if any of the parties referred to in clause (d) of sub-section (3) fails to subscribe, by the date specified by the Central Government under sub-section (4), for any share allotted to it, such share shall be subscribed for by the Central Government, the Reserve Bank and the appropriate Government in such proportions as may be determined by the Central Government;

Provided further that the shares subscribed for by the Central Government, the Reserve Bank and the appropriate Government, in pursuance of the provisions of the foregoing proviso, may be transferred to any party who is eligible under clause (d) of sub-section (3) to subscribe for such shares in the first instance, so, however, that the total number of shares held by any of the parties referred to that clause does not exceed fifteen percent, of the share capital of the Corporation

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The State Agricultural Credit Corporations Act,1968

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