THE NATIONAL HOUSING BANK ACT, 1987

1987 · State unknown · central · act_text

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Sections (269)

29 · Chapter not to apply in certain cases .

29A · Requirement of registration and net owned fund .

29B · Maintenance of percentage of assets .

29C · Reserve fund .

30A · Power of Reserve Bank to determine policy and issue directions .

33A · Power of Reserve Bank to prohibit acceptance of deposit and alienation of assets.

33B · Power of National Housing Bank to file winding up petition.

33C · Power to take action against auditors.

35A · Disclosure of information.

35B · Power of Reserve Bank to exempt housing finance institution.

36A · Power to order repayment of deposit.

36B · Nomination by depositors .

36D · Appointment of recovery officer.

36E · Application to the recovery officer.

36F · Procedure in respect of application under section 36E .

36G · Enforcement of order of recovery officer.

36H · Chief Metropolitan Magistrate and District Magistrate to assist recovery officer in taking charge of property.

36 · -I. Establishment of Appellate Tribunal .

36J · Composition of Appellate Tribunal.

36K · Qualification for appointment as Presiding Officer of Appellate Tribunal.

36M · Staff of Appellate Tribunal.

36N · Salaries and allowances and other terms and conditions of service of Presiding Officers.

36 · -O. Filling up of vacancies.

36Q · Orders constituting Appellate Tribunal to be final and not to invalidate its proceedings.

36R · Jurisdiction, powers and authority of Appellate Tribunal.

36S · Appeal to the Appellate Tribunal.

36T · Deposit of amount due, on filing appeal.

36U · Procedure and powers of recovery officer and Appellate Tribunal.

36W · Presiding Officer, recovery officer, other officers and employees to be public servant.

36X · Protection of action taken in good faith.

36Z · Transitional provisions.

43A · Delegation of powers.

45A · Arrangement with National Housing Bank on appointment of directors to prevail .

47A · Nomination in respect of deposits, bonds, etc.

52A · Power of National Housing Bank and Reserve Bank to impose penalty .

54A · Power to make rules.

1 · Short title, extent and commencement . — (1) This Act may be called the National Housing Bank Act, 1987.

2 · Definitions. — In this Act, unless the context otherwise requires,—

1 · 9th July, 1988, vide notification No. S.O. 684(E), dated 9th July, 1988, see Gazette of India, Extraordinary, Part II, sec. 3(ii) [in except Chapter V and sub-section (3) of section 49].

2 · Subs. by Act 15 of 2000, s. 2, for “its principal object” (w.e.f. 12-6-2000).

3 · Establishment and incorporation of National Housing Bank . — (1) With effect from such date as the Central Government may, by notification, appoint, there shall be established for the purposes of this Act, a bank to be known as the National Housing Bank.

3 · [4. Capital.—(1) The authorised and paid-up capital of the National Housing Bank shall be three hundred and fifty crores of rupees:

4 · [Provided that the Central Government may, by notification, increase the authorised capital up to two thousand crore rupees or such other amount as may be determined by it from time to time . ]

6 · [(3) The subscribed capital of one thousand four hundred and fifty crore rupees of the National Housing Bank, which has been subscribed to by the Reserve Bank, shall stand transferred to, and vested in the Central Government upon payment of the face value of the subscribed capital, to the Reserve Bank from such date as may be notified by the Central Government.]

5 · Management . — (1) The general superintendence, direction and management of the affairs and business of the National Housing Bank shall vest in the Board of Directors, which shall exercise all powers and do all acts and things, which may be exercised or done by the National Housing Bank.

1 · Subs. by Act 13 of 2018, s. 163, for “Bombay or at such other place as the Reserve Bank” (w.e.f. 1-6-2018).

2 · Subs. by s. 163, ibid., for “the Reserve Bank” (w.e.f. 1-6-2018).

3 · Subs. by Act 15 of 2000, s. 3, for section 4 (w.e.f. 12-6-2000).

4 · The Proviso subs. by Act 13 of 2018, s. 164 (w.e.f. 1-6-2018).

5 · The words “the Reserve Bank,” omitted by s. 164, ibid. (w.e.f. 1-6-2018).

6 · The Proviso ins. by s. 164, ibid. (w.e.f. 1-6-2018).

1 · [(a) the Chairman, if he is a whole-time director or if he is holding offices both as the Chairman and the Managing Director, or

6 · Board of Directors. — (1) The Board of Directors of the National Housing Bank shall consist of the following, namely:—

4 · [(c) two directors, who shall be persons with experience in the working of institutions involved in providing funds for housing or engaged in housing development or have experience in the working of financial institutions or scheduled banks;

7 · Term of office of Chairman, Managing Director and other directors, service conditions, etc. — (1) The Chairman and the Managing Director shall hold office for such term, not exceeding five years and shall receive such salary and allowances and be governed by such terms and conditions of service as the Central Government may 9*** specify and shall be eligible for re-appointment:

1 · Subs. by Act 15 of 2000, s. 4, for clauses (a) and (b) (w.e.f. 12-6-2000).

2 · The words ", in consultation with the Reserve Bank, or the Reserve Bank," omitted by Act 13 of 2018, s. 165 (w.e.f. 1-6-2018).

3 · Subs. by Act 15 of 2000, s. 5, for “three directors” (w.e.f 12-6-2000).

4 · Subs. by s. 5, ibid., for clause (c) (w.e.f. 12-6-2000).

5 · The words “the Reserve Bank,” omitted by Act 13 of 2018, s. 166 (w.e.f. 1-6-2018).

6 · Subs. by s. 166, ibid., for “two directors” (w.e.f. 1-6-2018).

7 · Subs. by Act 15 of 2000, s. 5, for “excluding the directors referred to in clause (d)” (w.e.f. 12-6-2000).

8 · Subs. by Act 13 of 2018, s. 166, for “in consultation with the Reserve Bank and directors” (w.e.f. 1-6-2018).

9 · The words “, in consultation with the Reserve Bank,” omitted by s. 167, ibid. (w.e.f. 1-6-2018).

8 · Disqualifications.—No person shall be a director of the Board, if he—

9 · Vacation and resignation of office by directors . — (1) If a director—

10 · Casual vacancy in the office of Chairman or Managing Director . — If the Chairman, or as the case may be, 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, appoint another person to act in his place during his absence.

1 · Subs. by Act 15 of 2000, s. 6, for “clauses (b) and (c)” (w.e.f. 12-6-2000).

2 · The proviso omitted by Act 45 of 2006, s. 19 (w.e.f. 16-10-2006).

3 · The words “, in consultation with the Reserve Bank,” omitted by Act 13 of 2018, s. 167 (w.e.f. 1-6-2018).

11 · 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.

12 · Executive Committee and other committees . — (1) The Board may constitute an Executive Committee consisting of such number of directors as may be prescribed.

13 · Director of Board or member of committee thereof not to participate in meetings in certain cases.—Any director of the Board or any 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.

14 · Business of the National Housing Bank.—Subject to the provisions of this Act, the National Housing Bank may transact all or any of the following kinds of business, namely:—

1 · [(b) making of loans and advances or rendering any other form of financial assistance whatsoever for housing activities to housing finance institutions, scheduled banks, state co-operative agricultural and rural development banks or any other institution or class of institutions as may be notified by the Central Government;

1 · Subs. by Act 15 of 2000, s. 7, for clause (b) (w.e.f. 12-6-2000).

1 · [(ea) buying, selling or otherwise dealing in any loans or advances secured by mortgage or charge of the immovable property relating to scheduled banks or housing finance institutions;

2 · [(f) promoting, forming, conducting or associating in the promotion, formation or conduct of companies, mortgage banks, subsidiaries, societies, trusts or such other association of persons as it may deem fit for carrying out all or any of its functions under this Act;]

3 · [(hh) formulating a scheme for the purpose of accepting deposits referred to in clause (a) of section 2 of the Voluntary Deposits (Immunities and Exemptions) Act, 1991 (47 of 1991) and crediting forty per cent. of the amount of such deposits to a special fund created under section 37;]

15 · Borrowings and acceptance of deposits by National Housing Bank . — (1) The National Housing Bank may, for the purpose of carrying out its functions under this Act—

1 · Ins. by Act 15 of 2000, s. 7 (w.e.f. 12-6-2000).

2 · Subs. by Act 15 of 2000, s. 7, for clause (f) (w.e.f. 12-6-2000).

3 · Ins. by Act 47 of 1991, s. 5 (w.e.f. 20-9-1991).

3 · [Provided that nothing contained in this clause shall apply to deposits accepted under the scheme formulated by the Bank in pursuance of clause (hh) of section 14;]

4 · [(i) by way of loans and advances and generally obtain financial assistance in such manner or on such terms and conditions as may be specified by the Reserve Bank;]

16 · Loans in foreign currency . — (1) Notwithstanding anything contained in 5 [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 Housing Bank may, for the purpose of making loans and advances under this Act, borrow in such manner and on such conditions as may be prescribed in consultation with the Reserve Bank and with the previous approval of the Central Government, foreign currency from any bank or financial institution in India or elsewhere.

6 · [16A. Assistance to borrower when to operate or a charge in the property offered as security . — (1) Where any person or institution seeks any financial assistance from the National Housing Bank on the security of any immovable property belonging to him or to that institution or on the security of the property of some other person whose property is offered as a collateral security for such assistance, such person or institution or, as the case may be, such other person may execute a written declaration in the form set out in the Third Schedule to this Act stating therein the particulars of the immovable property which is proposed to be offered as security, or as the case may be, collateral security, for such assistance and agreeing that the dues relating to the assistance, if granted, shall be a charge on such immovable property and, if on receipt of such declaration, the National Housing Bank grants any financial assistance to the person or institution aforesaid, the dues relating to such assistance shall, without prejudice to the rights of any other creditor holding any prior charge or mortgage in respect of the immovable property so

1 · Subs. by Act 15 of 2000, s. 8, for “the Central Government” (w.e.f. 12-6-2000).

2 · Subs. by s. 8, ibid., for "a period which shall not be less than twelve months from the date of the making of the deposit" (w.e.f. 12-6-2000).

3 · Added by Act 47 of 1991, s. 5 (w.e.f. 20-9-1991).

4 · Subs. by Act 15 of 2000, s. 8, for sub-clause (i) (w.e.f. 12-6-2000).

5 · Subs. by Act 13 of 2018, s. 168, for “the Foreign Exchange Regulation Act, 1973 (46 of 1973) (w.e.f. 1-6-2018).

6 · Ins. by Act 15 of 2000, s. 9 (w.e.f. 12-6-2000).

16B · Amount and security to be held in trust . — (1) Any sums received by a borrowing institution in repayment or realisation of loans and advances financed or refinanced either wholly or partly by the National Housing Bank shall, to the extent of the accommodation granted by the National Housing Bank and remaining outstanding, be deemed to have been received by the borrowing institution in trust for the National Housing Bank, and shall accordingly be paid by such institution to the National Housing Bank.

17 · Power to transfer rights . — The rights and interests of the National Housing Bank (including any other rights incidental thereto) in relation to any loan or advance made, or any amount recoverable, by it, may be transferred by the National Housing Bank, either in whole or in part, by the execution or issue of any instrument or by the transfer of any instrument by endorsement, or in any other manner in which the rights and interests in relation to such loan or advance may be lawfully transferred, and the National Housing Bank may, notwithstanding such transfer, act as the trustee within the meaning of section 3 of the Indian Trusts Act, 1882 (2 of 1882), for the transferee.

18 · Power to acquire rights . — The National Housing Bank shall have the right to acquire, by transfer or assignment, the rights and interests of any 1 [institution] (including any other rights incidental thereto) in relation to any loan or advance made, or any amount recoverable by such institution, either in whole or in part, by the execution or issue of any instrument or by the transfer of any instrument or in any other manner in which the rights and interests in relation to such loan or advance may be lawfully transferred.

2 · [18A. Exemption from registration . —N —Notwithstanding anything contained in sub-section (1) of section 17 of the Registration Act, 1908 (16 of 1908),—

1 · Subs. by Act 15 of 2000, s. 10, for “housing finance institution” (w.e.f. 12-6-2000).

2 · Ins. by s. 11, ibid. (w.e.f. 12-6-2000).

18B · Recovery of dues as arrears of land revenue . — Where any amount is due under an agreement to the National Housing Bank, whether acting as a trustee or otherwise, in respect of securitisation of loans of housing finance institutions and scheduled banks, the National Housing Bank may without prejudice to any other mode of recovery make an application to the State Government for the recovery of the amount due to it, and if the State Government or such authority, as that Government may specify in this behalf, is satisfied that any amount is due, it may issue a certificate for the amount to the Collector and the Collector shall proceed to recover that amount in the same manner as arrears of land revenue.]

19 · Power to impose conditions for accommodation . — In entering into any transaction under this Chapter with any borrowing 1 [institutions], the National Housing Bank may impose such conditions as it may think necessary or expedient for protecting the interests of the National Housing Bank.

20 · Power to call for repayment before agreed period.—Notwithstanding anything to the contrary contained in any agreement, the National Housing Bank may, by notice in writing, require any borrowing 1 [institutions] to discharge forthwith in full its liabilities to the National Housing Bank—

21 · National Housing Bank to have access to records . — (1) The National Housing Bank shall have free access to all such records of any 1 [institutions] which seeks to avail of any credit facilities from the National Housing Bank and to all such records of any person who seeks to avail of any credit facilities from such 1 [institutions], the perusal of which may appear to the national Housing Bank to be necessary in connection with the providing of finance or other assistance to such 1 [institutions] or the refinancing of any loan or advance made to such person by that 1 [institutions] .

22 · Validity of loan or advance not to be questioned . —N —Notwithstanding anything to the contrary contained in any other law for the time being in force, the validity of any loan or advance made by the National Housing Bank in pursuance of the provisions of this Act shall not be called in question merely on the ground of non-compliance with the requirements of such other law or of any resolution, contract, or any instrument regulating the constitution of the borrowing 1 [institutions]:

23 · National Housing Bank not to make loans or advances against its own bonds or debentures . — The National Housing Bank shall not make any loan or advance on the security of its own bonds or debentures.

24 · Power to inspect . — (1) The National Housing Bank may at any time and shall, on being directed so to do by the Reserve Bank, cause an inspection to be made by one or more of its officers of any 1 [institutions] to which the National Housing Bank has made any loan or advance or granted any other financial assistance, and its books, accounts and other documents; and the National Housing Bank shall supply to the 1 [institutions] a copy of its report on such inspection.

1 · Subs. by Act 15 of 2000, s. 12, for “housing finance institutions” (w.e.f. 12-6-2000).

25 · Power to collect credit information. — (1) The National Housing Bank may, for the purpose of the efficient discharge of its functions under this Act, at any time direct any 1 [institutions] to submit to it credit information in such form and within such time as may be specified by the National Housing Bank from time to time.

26 · Power to publish information.—The National Housing Bank, if it considers it in the public interest so to do, may publish any credit information or other information obtained by it under this Act, in such consolidated form or in any other form as it thinks fit.

27 · Advisory services.—The National Housing Bank may provide advisory services to the Central and State Governments, local authorities and other agencies connected with housing, in respect of—

2 · [PROVISIONS RELATING TO HOUSING FINANCE INSTITUTIONS]

28 · Definition of deposit.—In this Chapter the term 'deposit' shall have the meaning assigned to it in section 451 of the Reserve Bank of India Act, 1934 (2 of 1934).

29 · Chapter not to apply in certain cases.—(1) The provisions of this Chapter shall not apply to deposits accepted by a housing finance institution which is a firm or an unincorporated association of individuals.

3 · [29A. Requirement of registration and net owned fund—4 4 [(1) Notwithstanding anything contained in this Chapter or in any other law for the time being in force, no housing finance institution

1 · Subs. by Act 15 of 2000, s. 12, for “housing finance institution” (w.e.f. 12-6-2000).

2 · Subs. by Act 23 of 2019, s. 153, for the heading (w.e.f. 9-8-2019).

3 · Ins. by Act 15 of 2000, s. 13 (w.e.f. 12-6-2000).

4 · Subs. by Act 23 of 2019, s. 154, for sub-sections (1) and (2) (w.e.f. 9-8-2019).

3 · [Provided that the Reserve Bank may, wherever it considers necessary so to do, require the National Housing Bank to inspect the books of such housing finance institution and submit a report to the Reserve Bank for the purpose of considering the application.]

1 · Sub -section (3) omitted by Act 23 of 2019, s. 154 (w.e.f. 9-8-2019).

2 · Subs. by s. 154, ibid., for “National Housing Bank” (w.e.f. 9-8-2019).

3 · Ins. by s. 154, ibid. (w.e.f. 9-8-2019).

4 · [(iii) all other housing finance companies; and]

1 · Subs. by Act 23 of 2019, s. 154, for “National Housing Bank” (w.e.f. 9-8-2019).

2 · Subs. by s. 154, ibid., for “housing finance institution” (w.e.f. 9-8-2019).

3 · Subs. by s. 154, ibid., for “National Housing Bank” (w.e.f. 9-8-2019).

4 · Subs. by s. 154, ibid., for sub-item (iii) (w.e.f. 9-8-2019).

1 · [(II) the expressions "subsidiaries" and "companies in the same group" shall have the meanings respectively assigned to them in the Companies Act, 2013 (18 of 2013):

29B · Maintenance of percentage of assets . — (1) Every 2 [housing finance institution which is a company] shall invest and continue to invest in India in unencumbered approved securities, valued at a price not exceeding the current market price of such securities, an amount which, at the close of business on any day, shall not be less than five per cent . or such higher percentage not exceeding twenty-five per cent . as the 3 [Reserve Bank] may, from time to time and by notification, specify, of the deposits outstanding at the close of business on the last working day of the second preceding quarter.

1 · Subs. by Act 23 of 2019, s. 154, for clause (II) (w.e.f. 9-8-2019).

2 · Subs. by s. 155, ibid., for “housing finance institution” (w.e.f. 9-8-2019).

3 · Subs. by s. 155, ibid., for “National Housing Bank” (w.e.f. 9-8-2019).

4 · Subs. by s. 155, ibid., for "such higher percentage not exceeding twenty-five per cent., as the National Housing Bank may" (w.e.f. 9-8-2019).

29C · Reserve fund . — (1) Every housing finance institution which is a company shall create a reserve fund and transfer therein a sum not less than twenty per cent . of its net profit every year as disclosed in the profit and loss account and before any dividend is declared.

3 · [Provided that the National Housing Bank or the Reserve Bank] may, in any particular case and for sufficient cause being shown, extend the period of twenty-one days by such further period as it thinks fit or condone any delay in making such report.

5 · [30. Reserve Bank to regulate or prohibit issue of prospectus or advertisement soliciting deposits of money—The Reserve Bank may, if it considers necessary in the public interest so to do, by general or special order,—

6 · [30A. Power of Reserve Bank to determine policy and issue directions—(1) If the Reserve Bank is satisfied that, in the public interest or to regulate the housing finance system of the country to its advantage or to prevent the affairs of any housing finance institution which is a company being conducted in a manner detrimental to the interest of the depositors or in a manner prejudicial to the interest of such housing finance institutions, it is necessary or expedient so to do, it may determine the policy and give directions to all or any of the housing finance institution which is a company relating to income recognition, accounting standards, making of proper provision for bad and doubtful debts, capital adequacy based on risk weights for assets and credit conversion factors for off balance-sheet items and also relating to deployment of funds by a housing finance institution which is a company or a group of such housing finance institutions or housing finance institutions which are companies generally, as the

1 · Subs. by Act 23 of 2019, s. 156, for “specified by the National Housing Bank” (w.e.f. 9-8-2019).

2 · Subs. by s. 156, ibid., for “reported to the National Housing Bank” (w.e.f. 9-8-2019).

3 · Subs. by s. 156, ibid., for “Provided that the National Housing Bank” (w.e.f. 9-8-2019).

4 · Subs. by s. 156, ibid., for “the National Housing Bank” (w.e.f. 9-8-2019).

5 · Subs. by s. 157, ibid., for section 30 (w.e.f. 9-8-2019).

6 · Subs. by s. 158, ibid., for section 30A (w.e.f. 9-8-2019).

1 · [31. Power of National Housing Bank to collect information from housing finance institutions as to deposits . — (1) The National Housing Bank may at any time direct that every housing finance institution which is a company accepting deposits shall furnish to the National Housing Bank and the Reserve Bank in such form, at such intervals and within such time, such statements, information or particulars relating to or connected with deposits received by such housing finance institution, as may be specified by the National Housing Bank by general or special order.

2 · [32. Duty of housing finance institutions to furnish statements, etc., under this Chapter . — Every housing finance institution which is a company shall furnish the statements, information or particulars called for by the National Housing Bank or the Reserve Bank, as the case may be, and shall comply with any direction given to it under the provisions of this Chapter.]

33 · Powers and duties of auditors. — (1) The auditor of every 3 [housing finance institution which is a company] shall enquire whether or not the housing finance institution has furnished to 4 [the National Housing Bank and the Reserve Bank] such statements, information or particulars relating to or connected with deposits received by it, as are required to be furnished under this Chapter, and the auditor shall, except where he is satisfied on such enquiry that the 3 [housing finance institution which is a company] has furnished such statements, information or particulars, make a report to 4 [the National Housing Bank and the Reserve Bank] giving the aggregate amount of such deposits held by the 3 [housing finance institution which is a company] .

1 · Subs. by Act 23 of 2019, s. 159, for section 31 (w.e.f. 9-8-2019).

2 · Subs. by s. 160, ibid., for section 32 (w.e.f. 9-8-2019).

3 · Subs. by s. 161, ibid., for “housing finance institution” (w.e.f. 9-8-2019).

4 · Subs. by s. 161, ibid., for “the National Housing Bank” (w.e.f. 9-8-2019).

2 · [33C. Power to take action against auditors.—Where any auditor fails to comply with any direction given or order made by the National Housing Bank or the Reserve Bank under section 33, the Reserve Bank may, after giving a reasonable opportunity of being heard, remove or debar the auditor from exercising the duties as auditor of any of the Reserve Bank regulated entities for a maximum period of three years, at a time.]

34 · Inspection . — (1) The National Housing Bank may, 3 [at any time or on being directed so to do by the Reserve Bank, shall], cause an inspection to be made by one or more of its officers or employees or other persons (hereafter in this section referred to as the inspecting authority) of any 4 [housing finance institution which is a company], for the purpose of verifying the correctness or completeness of any statement, information or particulars furnished to the National Housing Bank or for the purpose of obtaining any information or particulars which the housing finance institution has failed to furnish on being called upon to do so.

5 · [(4) The National Housing Bank shall submit a copy of the report of inspection referred to in sub -section (1) to the Reserve Bank.]

35 · Deposits not to be solicited by unauthorised persons.—No person shall solicit on behalf of any 6 [housing finance institution which is a company] either by publishing or causing to be published any prospectus or advertisement or in any other manner deposits of money from the public unless—

1 · Subs. by Act 23 of 2019, s. 163, for “the Registrar of Companies” (w.e.f. 9-8-2019).

2 · Ins. by Act 18 of 2023, s. 2 and Schedule (w.e.f. 22-01-2024).

3 · Subs. 23 of 2019, s.164, for “at any time” (w.e.f. 9-8-2019).

4 · Subs. by s. 164, ibid., for “housing finance institution accepting deposits” (w.e.f. 9-8-2019).

5 · Ins. by s. 164, ibid. (w.e.f. 9-8-2019).

6 · Subs. by s. 165, ibid., for “housing finance institution” (w.e.f. 9-8-2019).

7 · Subs. by s. 165, ibid., for “National Housing Bank” (w.e.f. 9-8-2019).

1 · [35A. Disclosure of information . — (1) Any information relating to a 2 [housing finance institution which is a company] , —

4 · [35B. Power of Reserve Bank to exempt housing finance institution.—(1) The Reserve Bank, on being satisfied that it is necessary so to do, may declare by notification that all or any of the provisions of this Chapter shall not apply to a housing finance institution which is a company or a group of such housing finance institutions either generally or for such period as may be specified, subject to such conditions, limitations or restrictions as it may think fit to impose.

1 · Ins. by Act 15 of 2000, s. 18 (w.e.f. 12-6-2000).

2 · Subs. by Act 23 of 2019, s. 166, for “housing finance institution” (w.e.f. 09-08-2019).

3 · Subs. by s. 166, ibid., for “the National Housing Bank” (w.e.f. 09-08-2019).

4 · Subs. by s. 167, ibid., for section 35B (w.e.f. 09-08-2019).

36 · Chapter V to override other laws.—The provisions of this Chapter shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law.

1 · [36A. Power to order repayment of deposit . — (1) Every deposit accepted by a housing finance institution which is a company unless renewed, shall be repaid in accordance with the terms and conditions of such deposit.

36B · Nomination by depositors . — (1) Where a deposit is held by a housing finance institution to the credit of one or more persons, the depositor or, as the case may be, all the depositors together may nominate, in the manner prescribed by rules made by the Central Government under section 45ZA of the Banking Regulation Act, 1949 (10 of 1949) one person to whom in the event of the death of the sole depositor or the death of all the depositors, the amount of deposit may be returned by the housing finance institution.

1 · Ins. by Act 15 of 2000, s. 19 (w.e.f. 12-6-2000).

1 · [CHAPTER VA

36C · Definitions . — In this Chapter, unless the context otherwise requires,—

36D · Appointment of recovery officer . — (1) The Central Government may, in consultation with the National Housing Bank, by notification appoint such persons being the officers of the approved institution, as it may deem fit, to be recovery officers for the purpose of this Chapter who shall have such qualifications as the Central Government may by rules made under this Act specify.

36E · Application to the recovery officer . — (1) Where any borrower, who is under a liability to an approved institution under an agreement, makes any default in repayment of any assistance or any instalment thereof or otherwise fails to comply with the terms of said agreement, then, without prejudice to the provisions of section 69 of the Transfer of Property Act, 1882 (4 of 1882), the approved institution may apply, to the recovery officer within the limits of whose jurisdiction the borrower actually and voluntarily resides, or carries on business, or personally works for gain, or the cause of action wholly or in part arises, for the sale of the property pledged, mortgaged, hypothecated or assigned to the approved institution as security for the dues.

1 · Ins. by Act 15 of 2000, s. 20 (w.e.f. 12-6-2000).

36F · Procedure in respect of application under section 36E . — (1) On receipt of an application under section 36E, if the recovery officer is of opinion that the borrower is under a liability to an approved institution under an agreement, or has made default in repayment of the assistance or any instalment thereof or has otherwise failed to comply with the terms of said agreement, he shall cause a written notice of demand in such form as may be prescribed to be served on the borrower, calling upon him to pay the amount specified in the notice within a period of ninety days from the date of service thereof or to show cause as to why the relief prayed for should not be granted.

36G · Enforcement of order of recovery officer . — (1) Where the borrower refuses or fails to comply with the order within the time specified therein the recovery officer may, take possession of any property pledged, mortgaged, hypothecated or assigned to the approved institution as security for any assistance in respect of which default has been made and transfer by way of sale, lease or otherwise such property.

36H · Chief Metropolitan Magistrate and District Magistrate to assist recovery officer in taking charge of property . — (1) Where any property is sold or leased in pursuance of any power conferred by section 36E, the recovery officer may, for the purpose of taking into custody or under control any such property, request, in writing, the Chief Metropolitan Magistrate or the District Magistrate within whose jurisdiction any such property or other documents relating thereto may be situated or found to take possession thereof, and the Chief Metropolitan Magistrate or as the case may be, the District Magistrate shall, on such request being made to him, —

36 · -I. Establishment of Appellate Tribunal . — (1) The Central Government shall, by notification, establish one or more Appellate Tribunals, to be known as the Housing Finance Institutions Debt Recovery Appellate Tribunals, to exercise the jurisdiction, powers and authority conferred on such Tribunal by or under this Act.

36J · Composition of Appellate Tribunal . —A —An Appellate Tribunal shall consist of one person only (hereinafter referred to as the Presiding Officer of the Appellate Tribunal) to be appointed, by notification, by the Central Government.

36K · Qualifications for appointment as Presiding Officer of Appellate Tribunal . —A —A person shall not be qualified for appointment as the Presiding Officer of an Appellate Tribunal, unless he —

36L · Term of office . — The Presiding Officer of an Appellate Tribunal shall hold office for a term of five years from the date on which he enters upon his office or until he attains the age of sixty-five years, whichever is earlier.

36M · Staff of Appellate Tribunal . — (1) The Central Government shall provide the Appellate Tribunal with such officers and other employees as that Government may think fit.

36N · Salaries and allowances and other terms and conditions of service of Presiding Officers . — The salary and allowances payable to and the other terms and conditions of service (including pension, gratuity and other retirement benefits) of, the Presiding Officer of an Appellate Tribunal shall be such as the Central Government may by rules made under this Act specify:

36 · -O. Filling up of vacancies . — If, for any reason other than temporary absence, any vacancy occurs in the office of the Presiding Officer of an Appellate Tribunal, then the Central Government shall appoint another person in accordance with the provisions of this Act to fill the vacancy and the proceedings may be continued before the Appellate Tribunal from the stage at which the vacancy is filled.

36P · Resignation and removal . — (1) The Presiding Officer of an Appellate Tribunal may, by notice in writing under his hand addressed to the Central Government, resign his office:

36Q · Orders constituting Appellate Tribunal to be final and not to invalidate its proceedings . —N —No order of the Central Government appointing any person as the Presiding Officer of an Appellate Tribunal shall be called in question in any manner, and no act or proceeding before an Appellate Tribunal shall be called in question in any manner on the ground merely of any defect in the establishment of an Appellate Tribunal.

36R · Jurisdiction, powers and authority of Appellate Tribunal . —A —An Appellate Tribunal shall exercise the jurisdiction, powers and authority to entertain appeals against any order made or deemed to have been made by the recovery officer under this Act.

36S · Appeal to the Appellate Tribunal . — (1) Any person aggrieved by an order made or deemed to have been made by the recovery officer under this Chapter, may prefer an appeal to an Appellate Tribunal having jurisdiction in the matter.

36T · Deposit of amount due, on filing appeal . — Where an appeal is preferred by a borrower, such appeal shall not be entertained by the Appellate Tribunal unless such person has deposited with the Appellate Tribunal seventy-five per cent. of the amount due from him as determined by the recovery officer:

36U · Procedure and powers of recovery officer and Appellate Tribunal . — (1) The recovery officer and the Appellate Tribunal shall not be bound by the procedure laid down by the Code of Civil Procedure, 1908 (5 of 1908), but shall be guided by the principles of natural justice and, subject to the other provisions of this Act and of any regulations, the recovery officer and the Appellate Tribunal shall have powers to regulate their own procedure including the places at which they shall have their sittings.

36V · Limitation . — The provisions of the Limitation Act, 1963 (36 of 1963) shall, as far as may be, apply to an application made to recovery officer.

36W · Presiding Officer, recovery officer, other officers and employees to be public servant . — The Presiding Officer, other officers and employees of an Appellate Tribunal and the recovery officer shall be deemed to be public servants within the meaning of section 21 of the Indian Penal Code (45 of 1860) .

36X · Protection of action taken in good faith . —N —No suit, prosecution or other legal proceedings shall lie against the Central Government or against the Presiding Officer of an Appellate Tribunal or against the recovery officer for anything which is in good faith done or intended to be done in pursuance of the provisions of this Act or any rule or regulation or order made thereunder.

36Y · Bar of jurisdiction . —N —No Court or other authority shall have, or be entitled to exercise, any jurisdiction, powers or authority (except the Supreme Court, and a High Court exercising jurisdiction under articles 226 and 227 of the Constitution) in relation to the matters specified in this Chapter.

36Z · Transitional provisions . —N —Notwithstanding anything contained in this Act, till the establishment of the Appellate Tribunal under section 36-I for any area, the Appellate Tribunal established under section 8 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) and which is functioning in that area shall exercise the jurisdiction, powers and authority conferred on the Appellate Tribunal under this Act.]

37 · General Fund and other funds . — (1) With effect from such date as 1 [the Central Government] may specify, the National Housing Bank shall establish a fund to be called the General Fund and all payments by the National Housing Bank shall be made out of the said General Fund.

38 · Preparation of balance sheet, etc., of National Housing Bank.—(1) The balance sheet and accounts of the National Housing Bank shall be prepared and maintained in such form and manner as may be prescribed.

39 · Disposal of surplus.—After making provision for bad and doubtful debts, depreciation of assets and all other matters for which provision is necessary or expedient or which is usually provided for by bankers, the National Housing Bank shall transfer—

40 · Audit . — (1) The accounts of the National Housing Bank shall be audited by auditors duly qualified to act as auditors under 3 [sub-section (1) of section 141 of the Companies Act, 2013 (18 of 2013)], who shall be appointed by the Reserve Bank, for such term and on such remuneration as the Reserve Bank may fix.

1 · Subs. by Act 13 of 2018, s. 172, for “the Reserve Bank” (w.e.f. 1-6-2018).

2 · Subs. by s. 173, ibid., for “the Reserve Bank” (w.e.f. 1-6-2018).

3 · Subs. by s. 174, ibid., for “sub-section (1) of section 226 of the Companies Act, 1956 (1 of 1956)” (w.e.f. 1-6-2018).

41 · Returns. — The National Housing Bank shall furnish, from time to time, to the Reserve Bank such information and returns as the Reserve Bank may require.

42 · Annual report on housing . — The National Housing Bank shall make an annual report to the Central Government and the Reserve Bank on the trend and progress of housing in the country and in that report may make such suggestions as it may think necessary or expedient for the development of housing and the Central Government shall, as soon as may be after the report is received by it, cause the same to be laid before each House of Parliament.

43 · Staff of National Housing Bank.—(1) The National Housing Bank may appoint such number of officers and other employees as it considers necessary or desirable for the efficient performance of its functions and determine the terms and conditions of their appointment and service.

3 · [43A. Delegation of powers . — The Board may, by general or special order, delegate to an officer or officers of the National Housing Bank, subject to such conditions and limitations, if any, as may be specified in the order, such of its powers and duties under this Act as it may deem necessary.]

44 · Obligation as to fidelity and secrecy.—(1) The 4 [National Housing Bank or the Reserve Bank, as the case may be,] shall not, except as otherwise required by this Act or any other law, divulge any information relating to, or to the affairs of, its constituents except in circumstances in which it is, in accordance with the law or practice and usage customary among bankers, necessary or appropriate for the 4 [National Housing Bank or the Reserve Bank, as the case may be,] to divulge such information.

1 · Subs. by Act 15 of 2000, s. 21, for “three months” (w.e.f. 12-6-2000).

2 · The words, figures and letters ", without prejudice to the provisions of section 54AA of the Reserve Bank of India Act, 1934 (2 of 1934)," Omitted by Act 13 of 2018, s. 175 (w.e.f. 1-6-2018).

3 · Ins. by Act 15 of 2000. s. 22 (w.e.f. 12-6-2000).

4 · Subs. by Act 23 of 2019, s. 168, for “National Housing Bank” (w.e.f. 9-8-2019).

1 · [(3) Nothing contained in this section shall apply to the credit information disclosed under the Credit Information Companies (Regulation) Act, 2005.]

45 · Defects in appointment not to invalidate acts, etc.—(1) No act or proceeding of the Board or of any committee of the National Housing Bank shall be questioned on the ground merely of the existence of any vacancy in, or defect in the constitution of, the Board or the committee, as the case may be.

2 · [45A. Arrangement with National Housing Bank on appointment of directors to prevail . — (1) Where any arrangement entered into by the National Housing Bank with a housing finance institution which is a company provides for the appointment by the National Housing Bank of one or more directors of such housing finance institution, such provision and any appointment of directors made in pursuance thereof shall be valid and effective notwithstanding anything to the contrary contained in the 3 [Companies Act, 2013 (18 of 2013)] or in any other law for the time being in force or in the memorandum, articles of association or any other instrument relating to that housing finance institution, or any provision regarding share qualification, age limit, number of director-ships, removal from office of directors and such like conditions contained in any such law or instrument aforesaid, shall not apply to any director appointed by the National Housing Bank in pursuance of the arrangement as aforesaid.

46 · Protection of action taken under the Act. —N —No suit or other legal proceeding shall lie against 4 [the National Housing Bank or the Reserve Bank] or any director or any officer or other employee of 4 [the National Housing Bank or the Reserve Bank] or any other person authorised by 4 [the National Housing Bank or the Reserve Bank] to discharge any functions under this Act for any loss or damage caused or likely to be caused by anything which is in good faith done or intended to be done in pursuance of this Act or of any other law or provision having the force of law.

47 · Indemnity of directors.—(1) Every director shall be indemnified by the national Housing Bank against all losses and expenses incurred by him in, or in relation to, the discharge of his duties, except such as are caused by his own wilful act or default.

1 · Ins. by Act 30 of 2005, s. 34 and Schedule (w.e.f. 14-12-2006).

2 · Ins. by Act 15 of 2000, s. 23 (w.e.f. 12-6-2000).

3 · Subs. by Act 13 of 2018, s. 176, for “Companies Act, 1956 (1 of 1956)” (w.e.f. 1-6-2018).

4 · Subs. by Act 23 of 2019, s. 169, for “the National Housing Bank” (w.e.f. 9-8-2019).

1 · [47A. Nomination in respect of deposits, bonds, etc.—(1) Notwithstanding anything contained in any other law for the lime being in force, where a nomination in respect of any deposit, bonds or other securities is made with the National Housing Bank in the prescribed manner, the amount due on such deposits, bonds or securities shall, on the death of the depositor or holder thereof, vest in, and be payable to, the nominee subject to any right, title or interest of any other person to such deposits, bonds or securities.

48 · . [Explanation from tax on income.]—Omitted by the Finance Act, 2001 (14 of 2001), s. 141 (w.e.f. 1-4-2002).

49 · Penalties . — (1) Whoever in any return, balance sheet, or other document or in any information required or furnished by or under or for the purposes of any provision of this Act, wilfully makes a statement which is false in any material particular, knowing it to be false, or wilfully omits to make a material statement, shall be punishable with imprisonment for a term which may extend to three years and shall also be liable to fine.

3 · [(2A) If any person contravenes the provisions of sub-section (1) of section 29A, he shall be punishable with imprisonment for a term which shall not be less than one year but which may extend to five years and with fine which shall not be less than one lakh rupees but which may extend to five lakh rupees.

50 · Offences by companies . — (1) Where an offence has been committed by a company, every person who, at the time the offence was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly:

1 · Ins. by Act 15 of 2000, s. 24 (w.e.f. 12-6-2000).

2 · Sub -sections (2) and (2B) omitted by Act 18 of 2023, s. 2 and Schedule (w.e.f. 22-01-2024).

3 · Ins. by s. 25, ibid. (w.e.f. 12-6-2000).

4 · Subs. by s. 170, ibid., for “any order made by the authorised officer” (w.e.f. 9-8-2019).

5 · Clause (aa) omitted by Act 18 of 2023, s. 2 and Schedule (w.e.f. 22-1-2024).

6 · Sub -section (4) omitted by s. 2 and Schedule, ibid., (w.e.f. 22-1-2024).

51 · Cognizance of offences . — (1) No court shall take cognizance of any offence punishable under this Act except upon a complaint in writing made by an officer of 1 [the National Housing Bank or the Reserve Bank] generally or specially authorised in writing in this behalf by 1 [the National Housing Bank or the Reserve Bank] and no court other than that of a Metropolitan Magistrate or a Judicial Magistrate of the first class or a court superior thereto shall try any such offence.

2 · [52. Application of fine . —A —A court imposing fine under the Act may direct that the fine, if realised shall be applied—

3 · [52A. Power of National Housing Bank and Reserve Bank to impose 4 [penalty] . — (1) Notwithstanding anything contained in section 49, if the contravention or default of the nature referred to in the said section is committed by a housing finance institution which is a company, the National Housing Bank or the Reserve Bank, as the case may be, may impose on such company—

9 · [(1A) If any person or housing finance institution which is a company fails to produce any book, account or other document, or to furnish any statement or information, which, under the provisions of this Act, is the duty of such person or housing finance institution to produce or furnish, the National Housing

1 · Subs. by Act 23 of 2019, s. 171, for “the National Housing Bank,” (w.e.f. 9-8-2019).

2 · Subs. by Act 15 of 2000, s. 26, for section 52 (w.e.f. 12-6-2000).

3 · Subs. by Act 23 of 2019, s. 172, for section 52A (w.e.f. 9-8-2019).

4 · Subs. by Act 18 of 2023, s. 2 and Schedule, for “fine” (w.e.f. 22-1-2024).

5 · Subs. by s. 2 and Schedule, ibid., for “five thousand” (w.e.f. 22-1-2024).

6 · The word, brackets and letters “or clause (aa)” omitted by s. 2 and Schedule, ibid., (w.e.f. 22-1-2024).

7 · Subs. by s. 2 and Schedule, ibid., for “five lakh” (w.e.f. 22-1-2024).

8 · Subs. by s. 2 and Schedule, ibid., for “twenty-five thousand” (w.e.f. 22-1-2024).

9 · Ins. by s. 2 and Schedule, ibid., (w.e.f. 22-1-2024).

1 · Subs. by Act 18 of 2023, s. 2 and Schedule, for “sub-section (1)” (w.e.f. 22-1-2024).

2 · Subs. by s. 2 and Schedule, ibid., for “housing finance institution” (w.e.f. 22-1-2024).

3 · Subs. by s. 2 and Schedule, ibid., for “served on the housing finance institution” (w.e.f. 22-1-2024).

4 · Subs. by s. 2 and Schedule, ibid., for “failure of such housing finance institution” (w.e.f. 22-1-2024).

5 · Subs. by s. 2 and Schedule, ibid., for “the area where the registered office” (w.e.f. 22-1-2024).

6 · Ins. by s. 2 and Schedule, ibid., (w.e.f. 22-1-2024).

53 · Bankers' Books Evidence Act 18 of 1891, to apply in relation to National Housing Bank. — The Bankers' Books Evidence Act, 1891, shall apply in relation to the National Housing Bank as if it were a bank as defined in section 2 of that Act.

54 · Liquidation of National Housing Bank.—No provision of law relating to the winding up of companies shall apply to the National Housing Bank and the National Housing Bank shall not be placed in liquidation save by order of the Central Government and in such manner as it may direct.

1 · [54A. Power to make rules . — (1) The Central Government may, by notification, make rules to carry out the provisions of this Act.

55 · Power of the Board to make regulations.—(1) The Board may, with the previous approval of 2*** the Central Government, by notification, make regulations not inconsistent with this Act to provide for all matters for which provision is necessary or expedient for the purpose of giving effect to the provisions of this Act.

3 · [(aa) the manner in which directors shall be elected under clause (ca) of sub-section (1) of section 6;]

3 · [(fa) the form of application to be made under section 36E and the documents to be annexed to such application;

1 · Ins. by Act 15 of 2000, s. 27 (w.e.f. 12-6-2000).

2 · The words “the Reserve Bank and in consultation with” omitted by Act 13 of 2018, s. 177 (w.e.f. 1-6-2018).

3 · Ins. by Act 15 of 2000, s. 28 (w.e.f. 12-6-2000).

1 · [(ja) the manner in which nomination may be made under sub-section (1) of section 47A;]

56 · [Amendment of certain enactments.]—Rep. by Repealing and Amending Act 2001, (30 of 2001), s . 2 and the First Schedule (w . e .f .f. 3-9-2001).

57 · Power to remove difficulties. — If any difficulty arises in giving effect to the provisions of this Act, the Central Government may, by order, not inconsistent with the provisions of this Act, remove the difficulty:

1 · Ins. by Act 15 of 2000, s. 28 (w.e.f. 12-6-2000).

2 · The words "by the Reserve Bank , " omitted by Act 13 of 2018, s. 177 (w.e.f. 1-6-2018).

3 · Subs. by Act 15 of 2000, s. 28, for “regulation or scheme” (w.e.f. 12-6-2000).

1 · [THE THIRD SCHEDULE

1 · Added by Act 15 of 2000, s. 29 (w.e.f. 12-6-2000).

Subordinates (16)

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