Section 31 in Punjab State Aid to Industries Act, 1935
31. Government guarantee of a minimum return.
- The conditions of a guarantee by the [State] [Substituted for the word 'Provincial' by the Adaptation of Laws Order, 1950.] Government of a minimum return on the whole or part of the capital of a joint stock company shall be -(a)that the industry shall be subject to the conditions of section 26 in respect of inspection, returns and accounts;(b)that a minimum portion of the authorized capital of the industry to be fixed according to the circumstances of each case has been subscribed and paid in cash;(c)that no such guarantee shall in any case extend beyond a period of 5 years;(d)that during the period to which the guarantee extends, the [State] [Substituted for the word 'Provincial' by the Adaptation of Laws Order, 1950.] Government may impose on such persons as it considers to be directly concerned in the promotion of the company, a condition that if they transfer any of their shares without the consent of the [State] [Substituted for the word 'Provincial' by the Adaptation of Laws Order, 1950.] Government, they shall be liable jointly and severally to refund the [State] [Substituted for the word 'Provincial' by the Adaptation of Laws Order, 1950.] Government any sums paid to the company in fulfilment of the guarantee;(e)that the [State] [Substituted for the word 'Provincial' by the Adaptation of Laws Order, 1950.] Government shall be entitled to recover the whole or any part of the sum paid by the [State] [Substituted for the word 'Provincial' by the Adaptation of Laws Order, 1950.] Government on account of such guarantee with interest at the rate in force on the date of the agreement for loans granted under the Land Improvement Loans Act, 1883, at any time after such period as may have been laid down in the agreement, provided that the [State] [Substituted for the word 'Provincial' by the Adaptation of Laws Order, 1950.] Government is satisfied that the company is paying or is able to pay interest or a dividend upon the capital shown as paid in excess of such rate as may be fixed in the agreement and such recovery shall be made in the manner laid down in sections 23, 24 and 25 :Provided that the sum recoverable by the [State] [Substituted for the word 'Provincial' by the Adaptation of Laws Order, 1950.] Government in any one year shall not exceed a sum equal to half the net profits made by the company in the preceding year in excess of the sum required for the payment of interest or dividend at the rate fixed in agreement.
