Section 9(3) in The Banking Companies (Acquisition And Transfer Of Undertakings) Act, 1970
(3)[ Every Board of Directors of a corresponding new bank, constituted under any scheme made under sub-section (1), shall include-(a)[not more than four whole-time directors] to be appointed by the Central Government after consultation with the Reserve Bank;(b)one director who is an official of the Central Government to be nominated by the Central Government:Provided that no such director shall be a director of any other corresponding new bank.Explanation .-For the purposes of this clause, the expression "corresponding new bank" shall include a corresponding new bank within the meaning of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980);(c)[ one director, possessing necessary expertise and experience in matters relating to regulation or supervision of commercial banks, to be nominated by the Central Government on the recommendation of the Reserve Bank;] [Substituted by Act 45 of 2006, Section 3, for Clause (c) (w.e.f. 16.10.2006). ][* * *] [Clause (d) omitted by Act 45 of 2006, Section 3 (w.e.f. 16.10.2006). ](e)one director, from among such of the employees of the corresponding new bank who are workmen under clause (s) of section 2 of the Industrial Disputes Act, 1947 (14 of 1947), to be nominated by the Central Government in such manner as may be specified in a scheme made under this section;(f)one director, from among the employees of the corresponding new bank who are not workmen under clause (s) of section 2 of the Industrial Disputes Act, 1947 (14 of 1947), to be nominated by the Central Government after consultation with the Reserve Bank;(g)one director who has been a Chartered Accountant for not less than fifteen years to be nomiated by the Central Government after consultation with the Reserve Bank;(h)subject to the provisions of clause (i), not more than six directors to be nominated by the Central Government;(i)[ where the capital issued under clause (c) of sub-section (2-B) of section 3 is¬- [Substituted by Act 45 of 2006, Section 3, for Clause (i) (w.e.f. 16.10.2006). ](I)not more than sixteen per cent. of the total paid-up capital, one director;(II)more than sixteen per cent. but not more than thirty-two per cent. of the total paid-up capital, two directors;(III)more than thirty-two per cent. of the total paid-up capital, three directors, to be elected by the shareholders, other than the Central Government, from amongst themselves:Provided that on the assumption of charge after election of any such director under this clause, equal number of directors nominated under clause (h) shall retire in such manner as may be specified in the scheme:Provided further that in case the number of directors elected, on or before the commencement of the Banking Companies (Acquisition and Transfer of Undertakings) and Financial Institutions Laws (Amendment) Act, 2006, in a corresponding new bank exceed the number of directors specified in sub-clause (I) or sub-clause (II) or sub-clause (III), as the case may be, such excess number of directors elected before such commencement shall retire in such manner as may be specified in the scheme and such directors shall not be entitled to claim any compensation for the premature retirement of their term of office.] [Substituted by Act 37 of 1994, Section 6, for sub-Section (3) (w.e.f. 3.4.1995). ](3-A) The directors to be nominated under clause (h) or to be elected under clause (i) of sub-section (3) shall-(A)have special knowledge or practical experience in respect of one or more of the following matters, namely:-(i)agricultural and rural economy,(ii)banking,(iii)co-operation,(iv)economics,(v)finance,(vi)law,(vii)small-scale industry,(viii)any other matter the special knowledge of, and practical experience in, which would, in the opinion of the Reserve Bank, be useful to the corresponding new bank;(B)represent the interests of depositors; or(C)represent the interests of farmers, workers and artisans.[(3-AA) Without prejudice to the provisions of sub-section (3-A) and notwithstanding anything to the contrary contained in this Act or in any other law for the time being in force, no person shall be eligible to be elected as director under clause (i) of sub-section (3) unless he is a person having fit and proper status based upon track record, integrity and such other criteria as the Reserve Bank may notify from time to time in this regard.(3-AB) The Reserve Bank may also specify in the notification issued under sub-section (3-AA), the authority to determine the fit and proper status, the manner of such determination, the procedure to be followed for such determination and such other matters as may be considered necessary or incidental thereto.] [Inserted by Act 45 of 2006, Section 3 (w.e.f. 16.10.2006). ](3-B) Where the Reserve Bank is of the opinion that any director of a corresponding new bank elected under clause (i) of sub-section (3) does not fulfil the requirements of [sub-sections (3-A) and (3-AA)] [Substituted by Act 45 of 2006, Section 3, for " sub-Section (3-A)" (w.e.f. 16.10.2006). ], it may, after giving to such director and the bank a reasonable opportunity of being heard, by order, remove such director and on such removal, the Board of Directors shall co-opt any other person fulfilling the requirements of [sub-sections (3-A) and (3-AA)] [Substituted by Act 45 of 2006, Section 3, for " sub-Section (3-A)" (w.e.f. 16.10.2006). ] as a director in place of the person so removed till a director is duly elected by the shareholders of the corresponding new bank in the next annual general meeting and the person so co-opted shall be deemed to have been duly elected by the shareholders of the corresponding new bank as a director.]
