LexThe Tripura Protection of Interests of Deposits (In Financial Establishments) (amendment) Act, 2000
Tripura · state statute
Open in Lexace · Ask the AI about this actTripura Act No. 6 of 2000.
The Tripura Protection of Interests of
Depositors
(In Financial Establishments)
ACT, 2000.
THE TRIPURA PROTECTION OF
INTERESTS OF DEPOSITORS
( IN FINANCIAL ESTABLISHMENTS )
ACT, 2000.
TRIPURA ACT NO. 6 OF 2000. ARRANGEMENT OF SECTIONS
CHAPTER-I
PRELIMINARY
SECTIONS
1. Short Title, extent and Commencement.
2. Definition
CHAPTER-II
DEFAULT AND REMEDIES
3. Fraudulent default by Financial Establishment
4. Attachment of Properties on default of return to Deposits
5. Appointment of Competent Authority
6. Designated Court
7. Powers of Designated Court regarding attachment
8. Attachment of property of malafide transferees
9. Security in lieu of attachment
10. Administration of property attached
11. Appeal
CHAPTER III
SPECIAL PUBLIC PROSECUTOR FOR TRIAL PROCEDURE
12. Special Public Prosecutor
13. Procedure & Powers of Designated Court regarding Offences.
CHAPTER-IV
MISCELLANEOUS
14. Act to override other laws
15. Protection of action taken in good faith
16. Power to make rules.
17. Power to remove difficulties.
Published in the
EXTRAORDINARY ISSUE OF TRIPURA GAZETTE
Agartala, Monday, September 18, 2000 A.D. Bhadra 28, 1922. S.E.
PART – III
ACTS OF TRIPURA LEGISLATURE
GOVERNMENT OF TRIPURA
LAW DEPARTMENT
No.F.9(13)-Law/Leg/2000 Dated, Agartala, the 18th September, 2000
The following Act of the Tripura Legislative Assembly received the assent of the Governor
on the 12th September, 2000 and is hereby published for general information :-
2
TRIPURA ACT NO. 6 OF 2000
The Tripura Protection of Interests of Depositors
(In Financial Establishments) Act, 2000.
AN
ACT
to protect the interests of depositors of the Financial Establishment and for matters
connected therewith and incidental thereto.
Be it enacted by the Tripura Legislative Assembly in the Fifty-First year of the
Republic of India as follows:
Short title,
extent &
commencement
Definition
CHAPTER — I
PRELIMINARY
1. (1) This act may be called the Tripura Protection of Interests of
Depositors (In Financial Establishments) Act, 2000.
(2) It extends to the whole of Tripura.
(3) It shall come into force at once.
2. In this Act, unless the context otherwise requires, —
(a) “Competent Authority” means the Competent Authority
appointed under section 5;
(b) “Designated Court” means a Designated Court constituted under
section 6;
(c) “deposit” includes and shall be deemed always to have
included any receipt of money of acceptance of any valuable
commodity by any Financial Establishment to be returned after a
specified period or otherwise, either in cash or in kind in the
form of a specified service with or without any benefit in the form
of interest, bonus, profit or in any other form, but does not
include —
(i) amount raised by way of share capital or by way of debenture or by
bond or any other instrument covered under the guidelines
given, and regulations made by the SEBI establishment under
the S ecurities and Exchange Board of India Act, 1992; (15 of
1992);
(ii) amount contributed as capital by partners of a Firm ;
3
(iii) amount received from a scheduled bank or a co-operative bank or any
other banking company as defined in clause (c) of section 5 of the
Banking Regulation Act, 1949; (10 of 1949);
(iv) any amount received from
(a) the Industrial Development Bank of India;
(b) a State Financial Corporation ;
(c) any financial Institution specified in or under section 6A of the Industrial
Development Bank of India Act, 1964 (18 of 1964);
(d) any other institution that may be specified by the Government in this
behalf ;
(v) amount received in the ordinary course of business by way of-
(a) security deposit,
(b) dealership deposit,
(c) earnest money,
(d) advance against order for goods or services ;
(vi) any amount received from an individual or a - firm or an association
of individuals not being a body corporate, registered under any
enactment relating to money lending which is for the time being in
force in the state ; and
(vii) any amount received by way of subscriptions in respect of a chit.
“Chit” has the meaning as assigned to it in clause (b) of section 2 of
the Chit Funds Act, 1982, (10 of 1982);
Any credit given by a seller to a buyer on the sale of any property
(whether movable or immovable) shall not be deemed to be
deposited for the purposes of this clause.
(d) “Financial Establishment” means any person accepting deposit under
any scheme or arrangement or any other manner but does not include a
Corporation or a Co -operative Society owned or controlled by any state
Government or the Central Government or a Banking Company as
defined under clause
(c) of section 5 of the Banking Regulation Act, 1949, (10 of 1949) ,
(e) “Government” means Government of Tripura.
Explanation – I :-
Explanation – II :-
4
CHAPTER—II
DEFAULT AND REMEDIES
For Section 3 of the Tripura Protection of Interest of
Depositors (In Financial Establishments) Act, 2000 (hereinafter called as
the Principal Act), the followin g shall be substituted namely : -
“3.Any Financial Establishment which (i) fraudulently defaults any
repayment of deposit on maturity along with any benefit in the form of interest,
bonus, profit or in any other form as promised ; or (ii) fraudulently fails to render
service as assured, against the deposit ; or (iii) is found indulging in a fraudulent
act during business operation, every person including the promoter, partner,
director, manager or any other person or an employee responsible for the
management or conduct of the business or affairs of such Financial
Establishment shall, on conviction, be punished with imprisonment for a term
which may extend to ten years and with fine which may extent to one lakh of
rupees and such Financial Establishment also shall be liable for a fine which
may extent to one lakh of rupees :
Provided that in the absence of special and adequate reasons recorded in the
judgment of the Court, the imprisonment shall not be for less than 5 years and the
fine shall not be less than one lakh of rupees.
Explanation :- For the purpose of this section, a financial Establishment, means
and includes, which—
(i) commits default in repayment of such deposit with such benefits in the form of
interest, bonus, profit or in any other form as promised or fails to render any
specified service promised against such deposit ; or
(ii) fails to render any specific service agreed against the deposit with an
intention of causing wrongful gain to one person or wrongful loss to
another person ; or
(iii) commits such defaults due to its inability arising out of impracticable or
commercially not viable promises made while accepting such deposit or
arising out of deployment of money or assets acquired out of the deposits in such
a manner as it involves inherent risk in recovering the sa me when needed,
shall be deemed to have committed a default fraudulently or failed to render
specific service fraudulently.”
Substitution of section 3 of TPID (In Financial Establishment) Act, 2000
3. Insertion of new section – 3A
After Section 3 of the Principal Act, the following new Section 3A shall
be inserted, namely :-
Conviction for
Fraudulent
default
5
(1) Before starting operation in Tripura, every financial establishment shall intimate
the Competent Authority about the details of its business in the local jurisdiction
of such Authority indicating, with supporting documents, the permission /
sanction of the Authority like Securities and Exchange Board of India (SEBI)
or the Reserve Bank of India (RBI) or any other authority of Central or
State Government required under the relevant law for the time being in force
in such form and in such manner, as may be prescribed by the State
Government.
(2) Every financial establishment shall file a monthly statement about its
business transaction in that local area in such form and in such manner,
as may be prescribed by the State Government to the Competent
Authority along with a copy of the periodical statement which is filed to
the SEBI or, as the case may be, RBI or any other authority of Central or
State Government.
(3) The Government may authorize any officer of such rank as it may prescribe to
direct any financial establishment acting in its local jurisdiction to furnish such
other statement or information relating to or connected with the deposits
received by it.
(4) The Government may authorize any officer of such rank as it may prescribe to
visit the office premises or other places of any financial establishment Operating
in the State to check the books of account and other documents to ensure that the
business of deposit taking is being conducted as per relevant law with
permission or sanction of the authority empowered by that law or that such
business is not dressed in any form for misleading or cheating the depositors.
Illustration :- If a deposit taking business is dressed or camouflage in the form of
any other business like the business of real -estate, plantation, tours and travels,
supply of any valuable goods or service or gift thereof etc. shall be deemed to be
a fraudulent act for the purpose of this Act.
(5) For failure to furnish the intimation or statement under sub-section 1, 2 or 3 or
furnishing a wrong or misleading statement the competent authority, if satisfied
may after giving reasonable opportunity to the Financial Establishment in
accordance with law, impose a fine of Rs.25,000/ - (Rupees Twenty Five
thousand) for such every default.
(6) Upon receipt of a report from the officer authorized under sub -section 4 or
otherwise if the competent is satisfied that the Financial Establishment is acting in
a fraudulent manner in violation of the provision of relevant law may file a
Complaint alleging commission of an offence under Section 3.
In order to prevent continuation of such fraudulent act or default or non
cooperation at the time of inspection with ref erence to sub -section 4 or on
detection the inspecting officer that such business is not being conducted as per
relevant law with permission or sanction of the authority empowered by that law
or such business is dressed in any form for misleading or cheating the depositors,
the competent authority may also pass such interim order as he may consider
3A
6
appropriate to restrain that establishment from operating in that area, freeze the
bank accounts and restrain it from sale, transfer or alter any movable or
immovable property of that establishment pending confirmation by the State
Government.
(7) The fine money imposed under sub-section 5 if not paid within the time fixed
in the order may be recovered as arrear of land revenue.
(8) Any financial establishment, aggrieved by the order of the competent authority
may file appeal to the State Government within a month from date of the
order. Such appeal shall be heard by an officer not below the rank of a Secretary as
the State Government may authorize provided that no appeal will be admitted
without deposition of the amount of penalty ordered by the competent authority or
reduced amount if any by the appellate authority.
Insertion of new section – 3A in TPID (In Financial Establishment) Act, 2000.
4. (1) Notwithstanding anything contained in any other law for the time being in
force, –
(i) Where upon complaints received from the depositors or otherwise, the
Government is satisfied that any Financial Establishment has failed,—
a. to return the deposit after maturity or on demand by the depositor; or
b. to pay interest or other assured benefit; or
c. to provide the service promise against such deposit; or
(ii) where the Government has reason to believe that any Financial establishment is
acting in a calculated manner detrimental to the interest of the depositors with an
intention to defraud them and if the Govern ment is satisfied that such Financial
Establishment is not likely to return the deposits or make payment of interest or other
benefits assured or to provide the services against which the deposit is received
may, in order to protect the interest of the depositors of such Financial
Establishments, after recording reasons in writing, issue an order by
publishing it in the Official Gazette, attaching the money or other property
believed to have been acquired by such Financial Establishment either in its own
name or in the name of any other person from out of the deposits by the Financial
Establishment, or if it transpires that such money or o ther property is not
available for attachment or not sufficient for repayment of the deposits, such
other property of the said Financial Establishment or the promoter, Director,
partner or manager or member of the said Financial Establishment, as the
Government may think fit.
(2) On the publication of the order under sub -section (1) all the properties and the
assets of the Financial Establishment and the persons mentioned therein shall
forthwith vest in the Competent Authority appointed by the Government
pending further order from the Designated Court.
(3) The Collector of a District shall be competent to receive the complaints from
his District under Sub Section (1) and shall forward the same together with his
Attachment of
Properties on
default
7
report to the Government at the earliest and shall send a copy of the
complaint also to the concerned Superintendent of Police in the District
for investigation.
(1) Government may while issuing the order under Sub-section (1) of section 4,
appoint any of its officers not below the rank of a Deputy Collector as the
competent Authority to exercise control over the money and the properties
attached by the Government under section 4.
(2) The Competent Authority shall have such other powers as may be
prescribed for carrying out the purpose of this Act.
(3) The Competent Authority shall apply within 15 (fifteen) days from the date
of publication of the said order, to the Designated Court, accompanied by one
or more affidavits stating the grounds on which the Government has issued the
said order under section 4 and the amount of money or other property believed
to have been acquired out of the deposits and the details, if any, of persons in
whose name such property is believed to have invested or acquired or any
other property attached under section 4 for such further orders as may be
found necessary.
(4) The Competent Authority, may also make an application to any Special Court
or Designated Court or any other judicial forum established or constituted or
entrusted with the powers by any other State Government for adjudicating
any issue or subject matter pertaining to any money or property or assets of a
Financial Establishment under any similar enactment in respect of money or
property or assets belonging to or ostensibly belonging to a Financial
Establishment or any person notified under this Act situated within the
territorial jurisdiction of that Special Court or Designated Court or any judicial
forum, as the case may be, for passing appropriate orders to give effect to the
provisions of this Act.
(1) For the purposes of this Act the Government may, with the concurrence of
the Chief Justice of the Gauhati High Court, by notification, in the official
Gazette, constitute one or more Designated Court to be presided over by
a judicial officer not below the rank of a District Judge for such area or areas
or for such case or class or group of cases, as may be specified in the
notification.
(2) No Court other than the Designated Court shall have jurisdiction in respect of
any matter to which the provisions of this Act apply.
(3) Any pending case in any other Court to which the provisions of this Act apply
shall, on the date of publication of this Act, stand transferred to the
Designated Court.
(1) Upon receipt of an application under section 5, the Designated Court shall
issue to the Financial Establishment or to any other person whose property is
attached and vested in the Competent Authority by the Government under
section 4, a notice accompanied by copies of the application and affidavits
and of the evidence, if any, recorded calling upon the said Establishment and the
said person to show cause on a date to be specified in the notice, why the order of
attachment should not be made absolute.
Competent 5.
Authority
Designated 6.
Court
Powers of Desig- 7.
nated Court
Regarding
attachment
8
(2) The Designated Court shall also issue such notice, to all other persons
represented to it as having or being likely to claim, any interest or title in
the property of Financial Establishment or the person to whom the notice is
issued under Sub -section (1), calling upon all such persons to appear on the
same date as that specified in the notice and make objection if they so desire
to the attachment of the property or any portion thereof, on the ground that
they have interest in such property or portion thereof.
(3) Any person claiming an interest in the property attached or any portion
thereof may, notwithstanding that no notice has been served upon him
under this section, make an objection as aforesaid to the Designated Court
at any time before an order is passed under sub-section (4) or sub-section
(6) ;
(4) The Designated Court shall if no cause is shown and no objections are made
on or before the specified date, under sub-section (3), forthwith pass an
order making the order of attachment absolute, and issue such direction as
may be necessary for disposal of the assets attached and for the equitable
distribution among the depositors of the money realized from out of the
property attached.
(5) If cause is shown or any objection is made as aforesaid, the Designated
Court shall proceed to investigate the same and in so doing, as regards the
examination of the parties and in all other respects, the Designated Court
shall, subject to the provisions of this Act, follow the summery procedure as
contemplated under order 37 of the Civil Procedure Court, 1908 and
exercise all the powers of a court in hearing a suit under the said code and
any person making an objection shall be required to adduce evidence to show
that on the date of attachment he had some interest in the property
attached.
(6) After investigation under sub-section (5), the Designated Court shall pass
an order either making the order of attachment passed under sub-section (1)
of section 4 absolute or varying it by releasing a portion of the property
from attachment or canceling the order of attachment :
Provided that the Designated Court shall not release from attachment any
interest, which it is satisfied that the Financial Establishment or the person
referred to in sub-section (1) has in the property, unless it is also satisfied that
there will remain under attachment an amount or property of value not less
than the value that is required for repayment to the depositors of s uch
Financial Establishment.
(7) Where an application is made by any person duly authorized or
constituted specified by any other State Government under similar
enactment empowering him to exercise control over any money or
property or assets attached by the S tate Government, the Designated
Court shall exercise all its power, as if such an application was made
under this Act and pass appropriate order or direction on such
application, so as to give effect to the provisions of such enactment.
(1) Where the assets available for attachment of a Financial Establishment or
other person referred to in section 4 are found to be less than the amount
Attachment of 8.
Property of
malafide
transferees
9
or value which such Financial Establishment is required to repay to the
depositor and where the Designated Court is satisfied by affidavit or
otherwise, that there is reasonable cause for believing that said Financial
Establishment has transferred(whether after the commencement of this Act or
not) any of the property otherwise than in good faith and for consideration,
the Designated Court may, by notice, require any transferee of such property
(whether or not he received the property directly form the said Financial
Establishment) to appear on a date to be specified in the notice and show
cause why so much of the transferee's property as is equivalent to the
proper value of the property transferred should not be attached.
(2) Where the said transferee does not appear and show cause on the specified
date, or where after investigation in the manner provided in subsection (5) of
section 7, the Designated Court is satisfied that the transfer of the property
to the said transferee was not in good faith and for consideration, the
Designated Court shall order the attachment of so much of the said
transferee’s property as in the opinion of the Designated Court equivalent to
the proper value of the property transferred.
Any Financial Establishment or person whose property has been or is about
to be attached under this Act may, at any time, apply to the Designated
Court for permission to give security in lieu of such attachment and where
the security offered and given is, in the opinion of the Designated Court,
satisfactory and sufficient, it may cancel, the order of attachment or, as
the case may be, refrain from passing the order of attachment.
The Designated Court may, on the application of any person interested in
any property attached and vested in the Competent Authority under this Act
and after giving the Competent Authority an opportunity of being heard.
make such order as the Designated Court considers just and reasonable
for—
(a) Providing from such of property attached and vested in the Competent Authority
as the applicant claims and interest in such sums as may be reasonably
necessary for the maintenance of the applicant and of his family, and for
expenses connected with the defence of the applicant where criminal
proceedings have been instituted against him in the Designated Court
under section 3 :
(b) Safeguarding so for as may be practicable the interest of any business
affected by the attachment and in particular, the interest of any partners in such
business or any other person connected with such business.
11. Any person including the Competent Authority, if aggrieved by an order
of the Designated Court, may appeal to the High Court within the sixty
days from the date of the order.
Administration 10.
of Property
attached
Security in lieu 9.
of attachment
Appeal
10
CHAPTER—III
SPECIAL PUBLIC PROSECUTOR AND TRIAL PROCEDURE
12. The Government may, by notification appoint an Advocate of not less than
ten years standing as a Special Public Prosecutor in consultation with the
District and Sessions Judge of the concerned District, for the purpose of
conducting cases in the Designated Court.
13. (1) The Designated Court may take cognizance of the offence without the case
being committed to it for trial and in trying the accused person, shall follow
the procedure prescribed in the Code of Criminal Procedure, 1973 (2
of 1974) for the trial of warrant cases by the Magistrates.
The provisions of the code of Criminal Procedure, 1973, (2 of 1974) shall
so far as, may be, apply to the proceedings before a Designated Court and
for the purposes of said provisions a Designated Court shall be deemed to
be a Magistrate.
CHAPTER—IV
MISCELLANEOUS
For Section 14 of the Principal Act, the following Section shall be
substituted, namely :-
“14. Notwithstanding anything to the contrary contained in any other Act,
except the Act or Acts enacted by Parliament and the rules framed
thereunder, the provisions of this Act shall apply.”
Substitution of section 14 of TPID (In Financial Establishment) Act, 2000.
15. No suit or other proceeding shall lie against the Government or the Competent
Authority or an officer or employee of the Government for anything which is in
good faith done or intended to be done under this Act.
16. The State Government may, by notification in the Official Gazette,
make rules to carry out the purposes of this Act.
Every rule made under this Act shall be laid, as soon as m ay be, after it is
made before the House of the State Legislature, while it is in session for a
total period of thirty days, which may be comprised in one session or in
two successive sessions, and if, before expiry of the session in which it is so
laid or the session immediately following the House agree in making any
modification in the rule or House agree that the rule should not be made,
and notify the decision to that effect in the Official Gazette, the r ule shall
from the date of publ ication of such decision in the Offici al Gazette, have
effect only in such modified form or be of no eff ect, as the case may be, so
however, that any such modification or annulm ent shall be without
prejudice to the validity of anything previously done or omitted to be done
under that rule.
Procedure and
Powers of
Designated Court
regarding Offences
Special Public
Prosecutor
(2)
(2)
(1) Power to
Make Rules
Protection of
action taken in
good faith
Act to override
Other laws
11
17. If any difficulty arises in giving effect to the provisions of this Act the
Government may, as occasion arise, by order, do anything not inconsistent
with the provisions of this Act, which appears to it to be necessary to remove
the difficulty.
A. B. Paul
L. R. & Secretary,
Government of Tripura.
Power to
Remove
difficulties