Published
in, Part II, Section 3 sub-section (I) the Gazette of India Extraordinary,
dated
01.10.2001
Government
of India
Ministry
of Law Justice and Company Affairs
Department
of Company Affairs
GSR 750(E). – In exercise of the powers
conferred by clauses (a) and (b) of
sub-section (1) of section 642 of the Companies Act, 1956 (1 of 1956),
read with sub-section (3) of
section 205C of that Act, the Central Government hereby makes the following
rules, namely:-
1. (1)
These rules may be called the
Investor Education and Protection Fund (awareness and protection of
investors) Rules, 2001.
(2) They shall come into force on the date of their publication. in the
Official Gazette.
2.
Definitions:
In these rules, unless the context otherwise
requires:-
(a)
‘Act’ means the Companies Act,
1956;
(b)
‘Fund’
means the Investor Education and Protection Fund(IEPF) established under sub-section (1) of 205C of the Act, 1956(1 of
1956.)
(c)
“Ministry”
or “Department” means Ministry or Department of the Central Government dealing
the Company Affairs;
(d)
‘Committee’/Sub
Committee’ means the Committee specified by Central Government under sub-section
(4) of section 205C of the Act to administer the Fund.
(e) ‘Form ‘
means forms prescribed by these
rules;
(f) Words and
expressions used in these rules and not defined herein but defined in
the Act shall have the meaning respectively assigned to them in the
Act.
3.
Credits to the Fund:
(i) Any amount required to be credited by the companies to the
Fund, as provided in the Act shall be remitted into the concerned specified branches of Punjab National
Bank, within a period of thirty
days of such amounts becoming due
to be credited to the Fund and the amount
so credited shall be accounted for as provided in Rule 4
below.
(ii)
(a) The amount shall be
tendered by the companies on behalf
of the Central Government in
such branches of Punjab National
Bank along with Challan (in triplicate) and the Bank will return two copies duly stamped
to the Company as token of having received the amount.
(b) Every Company shall file with the
concerned Registrar of
Companies one copy of the Challan referred to in (a) evidencing deposit of the
amount to the Fund. The Company shall fill in the full description and the
nature of the amount tendered and
its Head of Account
(c)
(i)
Every Company shall, when effecting a credit to the account of the Fund, will
separately furnish to the concerned Registrar of Companies a statement in Form
1 duly
certified by a chartered accountant or a company secretary or a cost accountant
practicing in India or by the statutory auditors of the company. Provided that
each Company shall keep a record relating to folio number, Certificate Number
etc in respect of persons
to whom the amount
of unpaid or unclaimed
dividend, application money,
matured deposit or debentures, interest accrued or payable, for a period of three years and the
Committee or Sub-Committee shall have powers to inspect such records of that period.
(ii)
On receipt of this statement, the concerned Registrar of Companies shall enter
the details of such receipt in a register and reconcile the amount so remitted
and collected, with the concerned Pay and Accounts Officer, on monthly
basis.
(iii) Each Registrar of Companies shall
furnish an abstract of such receipt received during the month to Department of
Company Affairs within seven days after the close of the
month.
(iv)
Department of Company Affairs shall maintain a consolidated abstract of receipts
and shall reconcile them on a quarterly basis with Principal Pay and Accounts
Office of the Department of Company Affairs.
(i)
(A) All amounts received shall be accounted
for under the following Heads of account, which shall thereafter be transferred to the
Fund.
MAJOR
HEAD 0075 - Miscellaneous General
Services.
Minor
Head 104 - Unclaimed and
unpaid dividends, deposits and debentures etc of Investors in Companies
(a)
Unpaid
dividend
(b)
Unpaid
application money received by
Companies for allotment of securities and due for refund
(c)
Unpaid
Matured Deposit
(d)
Unpaid
Matured Debentures.
(e)
Interest
accrued on (a) to (d).
i)
Interest
on unpaid dividend
ii)
Interest
on unpaid application money
received by Companies for allotment of securities and due for
refund
(iii) Interest on unpaid
matured deposits
(iv)
Interest
on unpaid matured debentures.
(i)
(B) Grants and donations given to the fund
by State Governments, Companies or any other Institutions will be credited under
a separate Sub –head under the minor head `800 – Other Receipts below the Major
Head `0075- Miscellaneous General Services’
(ii)All
expenditure for the purposes of
carrying out of the objects for which the Fund has been established
shall be incurred under the
functional head expenditure head of
Department of Company Affairs and equivalent amount will be shown as deduct
entry by transfer of amount from the fund.
(iii)Surplus
amount, if any, from the fund accounts shall not, for the present, be utilised
for investment purpose.
5.
Expenses of the Committee :-
(a)
The
official member of the committee or sub-committee shall be entitled to
Travelling Allowance according to the rules regulating their official
position.
(b)
For
journeys performed by a non-official member of the Committee or sub-committee or
a special invitee in connection with the work of the committee or a
sub-committee shall be entitled for TA/DA as per supplementary Rules
of
Central Government.
(c)
Committee shall have powers to recommend appointment/remuneration to any
experts in such areas as may be considered necessary.
(d) Committee shall
have powers to recommend appointment of Auditors and for scrutinizing the
accounts of the voluntarily
agencies registered with it.
6.
Audit of Accounts.
The accounts of the
Fund shall be audited by internal audit party of the Department of Company
Affairs every year and will also be subject to audit by the office of
Comptroller and Auditor General of India.
7. Constitution
and Functions of the Committee
(a)The Committee shall consists of ten members, excluding the
chair person who is Secretary, to
the Department of Company
Affairs. The members shall be
nominated by Reserve Bank of India, the Securities and Exchange Board of India
and or from any other Ministry or
Department of Central Government dealing with investor protection activities and
experts from the field of investors education and protection. The non-official Members
shall hold office for a period of two years. The Official members shall hold
office for a period of two years or until they occupy their position which ever
is earlier The constitution of the Committee shall be notified in the Official
Gazette.
(b)
Functions of the Committee
(i) The Committee shall recommend
the following activities relating to investors’ education, awareness and
protection:
(a)
Education
Programs through Media;
(b)
Organizing
Seminars and Symposia;
(c)
Proposals
for registration of Voluntary Associations or Institution or other Organizations
engaged in investor Education and protection activities;
(d)
Proposals
for projects for Investors Education and
Protection including research activities and proposals for financing such
projects;
(e)
Coordinating
with institutions engaged in Investor Education, awareness, and protection
activities
The
Committee may also be entrusted with such other functions for carrying out the
objects for which the Fund has been established.
(f)(i)
The Committee may appoint one or more sub-committees whenever it considers
necessary to facilitate efficient and speedy
discharge of its functions.
(ii)
Sub-committee shall be constituted from amongst the members.
(iii)The
Chairperson of the Committee may
nominate any one of the members of the sub-committee as its convenor and where
no such nomination has been made, the members of the sub-committee elect a
convenor amongst themselves.
(iv) The Committee may have Sub-
Committee to examine the end use of grants and assistance and recommend
release of funds.
8. Power to call upon a
Company:
(i)
The
Committee shall have suo moto
powers to call upon any company to pay the amount due to the Fund.
(ii) Committee
shall call upon any company to give
estimates of the amounts to be credited to the Fund in form
2.
9. Report by
the Committee:
The Committee shall furnish its activity report for every six month’s
period to the Central Government.
10 Meetings
:-
(i) one
third of the total members subject
to five members in the case of
meeting of committee and three
members in case of sub committee meeting shall constitute a
quorum.
(ii)
The Chairperson of the
Committee and the convenor of a sub-committee, respectively, shall preside over
the meetings of the Committee or the sub-committee as the case may be. In the event of the Chairperson or, as the case may be, the convenor
being unable to attend the meeting for any reason, the members present may elect
one amongst themselves to preside over the meeting.
(iii) The
Chairperson of the Committee or the
convenor of a sub-committee may, call meeting of the Committee or a
sub-committee:
Provided
that the Chairperson or the Convenor, as the case may be, shall also call a
meeting if a requisition for that purpose is presented to him by at least five
members in the case of the Committee and three members in the case of a
sub-committee.
(iv)
At least fourteen clear days’
notice indicating the time and place of the meeting shall be sent to the members of
the Committee or the Sub-committee as the case may be
:
Provided
that in case of urgency, a special meeting of the Committee or Sub-committee may
be called at any time by the Chairperson or the convenor, who shall inform the
members at least three clear days in advance of the subject matter for
consideration at the meeting and the reasons for which he considers the meeting
urgent;
(v)
The Chairman or the convenor, as the case may be, may invite any person to
attend any meeting of the Committee or sub-committee as a special invitee but
such person shall not be entitled to vote.
11.
Agenda:
(i)
At least seven clear days before any meeting of the Committee or a
sub-committee, except meetings referred to in proviso to sub-rule (iv) to rule
10, a list of business proposed to be transacted at the meeting shall be sent to
the members of the Committee or of a sub committee, as the case may
be.
(ii)
No business, not included in the list of business, shall be transacted at a
meeting without the permission of the chairperson presiding over the
meeting.
12.
Voting :
(i)
Every
question brought before any meeting of the
Committee
or sub-committee, as the case may be, shall be decided by a majority vote of
members present and voting at the meeting.
No member shall vote by proxy.
(ii) In the event of equality of votes, at a meeting, the Chairperson or
the convenor, as the case may be or in his absence , the person presiding, shall
have a second or casting vote.
13.
Minutes :
The
minutes of the meeting of the Committee or Sub-committee shall be caused to be
recorded and circulated among the members.
14.
Conditions for Utilization of Funds
by the Committee:-
(i)
The Committee may register from time to time various Associations or
institutions or organisations engaged in activities relating to investor
awareness, education and protection
and proposing for Investors programmes ;
organising seminar, symposia and undertake projects for Investor Protection
including research activities.
(ii)
Application
for registration by such organisations referred to in sub-rule (i) be made in
Form-3.
(iii)
Application for release
of funds for the activities listed in Rule 7(i)
from the organizations or Institutes registered with the Department
of Company Affairs shall be
made in Form 4.
(iv)
A
copy of the summary or recommendations of the seminar or programme conducted and
copy of Accounts for such activity by such organisation e.g. registered
associations or chambers of commerce or institutes shall be provided to the
Committee within ten days of the conclusion of the seminar or
programme.
(v)
The
organisation or Associations
registered shall be considered for grant of funds as a grant-in-aid
either as one time measure or in stages or by way of reimbursement depending
upon the nature of the activity proposed.
(vi)
The
Committee shall be entitled to
examine the end use of grants and assistance before recommending release of
funds.
(vii)
The
Committee shall cause to draw at the end of each Financial Year,
a
statement of Total Receipts from
various sources indicated in section 205C of the Companies Act 1956) and the
grants disbursed or the expenditure incurred in connection with the activities
organised by the Committee or Sub Committee and other expenditure incurred for
holding the meetings.
(viii)
The
Committee shall maintain the necessary records showing amount disbursed, date of
disbursal, the name of Organisation or Voluntary agency, the activities of the
agency for which such disbursal was
made.
( A. Ramawamy )
Joint
Secretary to the Govt. of India.
No.
Form
No: 1
(see
Rule 3)
Registration No:
Authorised
Capital:
Rs.
(To
be submitted by the Company to the concerned Registrar of Companies along-with
the copy of the challan)
1. Name
of the company and Address of its registered office:
2. Date
of payment of amount to the Fund.
3.
Particulars of
the Challan :
Mode
of payment (DD/Cash)
:
4. Details
of the amount which are credited to
the Fund:
(a)
amounts
in the unpaid dividend accounts of companies;
(b)
the
application moneys received by companies for allotment of any securities and due
for refund;
(c)
matured deposits with
companies;
(d) matured debentures with
companies;
(e)
interest accrued on the amounts referred to in clauses (a) to (d) be shown
separately for each item, both in challan and in this
form.
(f)
Grants
and donations.
Financial year(s) to
which the amount(s)
relates.
5. Details
of filing Form 1A under section 205A(6) and (7) of the Companies Act,
1956.
presenting
the return
Place & date
Date Certificate from auditors
FORM
NO.2
(See
Rule 8)
1.
Name of the Company.
2.
Registered Office
3.
Financial Year
4.
Total amount due as on
31st March
of the
relevant financial
year
5. Details of
amount
credited
to InvestorEducation &
Protection
Fund during the year
6. Details
of amounts
remaining
unclaimed for six years since becoming due for payment
for the following
a. Unpaid dividend
b. Unclaimed share application money
c. Unclaimed matured deposits
d. Unclaimed matured debentures
e. Interest in respect of (a) to (d)
7. Relevant financial year
in which
amount is due for payment or redemption.
Place
Chartered Accountant/Cost Accountant/Company Secretary/Statutory
Auditor
Form No:3
(see
Rule 14)
(Application
for registration)
Note:
(1) Submission of the registration form does not necessarily guarantee automatic
registration or funding
(2)
Committee reserves the right to
reject any application in its own discretion without assigning any reason
thereof.
(3)
Committee may call for additional details as and when required for the purpose
of granting registration.
(4)
Any false information furnished or false representation made shall make the
application/registration liable for
rejection/cancellation.
1. Name of
Association:
2. Address:
Tel
No./Fax No./E-mail
3. Year of Establishment
:
Registration
No: and Date:
4. Principal office
bearer.
Address:
5.
Organisational structure
(a)
Office
Bearers:
|
Name |
Educational Qualifications |
Occupation/ Profession |
Experience (specify
in number
of years of experience as investor either in primary
or secondary
market) |
Remuneration
received from the
Association |
|
President |