Section 13 in Securities And Exchange Board Of India (Debenture Trustees) Regulations, 1993
13. Obligation before appointment as debenture trustees.-
No debenture trustee who has been granted a certificate under regulation 8 shall act as such in respect of each issue of debenture unless-(a)[ he enters into a written agreement with the body corporate before the opening of the subscription list for issue of debentures; [Substituted by S.O. 743(E), dated 8.8.2000](b)the agreement under clause (a) shall inter alia contain:(i)[ an undertaking by the body corporate to comply with all regulation/provisions of Companies Act, 2013, guidelines of other regulatory authorities in respect of allotment of debentures till redemption.];(ii)[ the time limit within which the security for the debentures shall be created or the agreement shall be executed in accordance with the Companies Act, 2013 or provisions as prescribed by any regulatory authority as applicable.] [Substituted by Notification No. SEBI/LAD-NRO/GN/2017-18/011, dated 13.6.2017 (w.e.f 29.12.1993)]][[13A. [Substituted by S.O. 763(E), dated 4.7.2003]A person shall not be appointed as a debentures trustee, in case-(a)the debenture trustee,-(i)is an associate of the body corporate;(ii)beneficially hols shares in the company;(iii)is a promoter, director or key managerial personnel or any other officer or an employee of the company or its holding, subsidiary or associate company;(iv)is beneficially entitled to moneys which are to be paid by the company otherwise than as remuneration payable to the debenture trustee;(v)is indebted to the company or its subsidiary or its holding or associate company or a subsidiary of such holding company;(vi)has furnished any guarantee in respect of the principal debts secured by the debentures or interest thereon;(vii)has any pecuniary relationship with the company amounting to 2% or more of its gross turnover or total income or Rs. 50 lakh or such higher amount as may be prescribed, whichever is lower during the two immediately preceding financial years or during the current financial year;(viii)is relative of any promoter or any person who is in the employment of the company as a director or key managerial personnel;(ix)is likely to have conflict of interest in any other manner:Provided that this requirement shall not be applicable in respect of debentures issued:(i)wherever there is gurantee by the state/central government for the debentures issued.](b)it has lent and the loan is not yet fully repaid or is proposing to lend money to the body corporate:Provided that this requirement shall not be applicable in respect of debentures issued prior to the commencement of the Companies (Amendment) Act, 2000, where-(i)recovery proceedings in respect of the assets charged against security has been initiated, or(ii)the body corporate has been referred to Board for Industrial and Financial Reconstruction under the Sick Industrial Companies (Special Provisions) Act, 1985, prior to commencement of the Securities and Exchange Board of India (Debenture Trustees) (Amendment) Regulations, 2003.]
