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119. Liability of trustees for debenture holders. (1) Subject to the provisions of this section, any provision contained in a trust deed for securing an issue of debentures, or on any contract with the holders of debentures secured by a trust deed, shall be void insofar as it would have the effect of exempting a trustee thereof from, or indemnifying him against, liability for breach of trust, where he fails to show the degree of care and diligence required of him as trustee, having regard to the provisions of the trust deed conferring on him any powers, authorities or discretions.
 

In any case, sub-section (1) of section 119 specifically provides that a trustee would be liable for breach of trust, in case he fails to take and to have so taken the degree of care and diligence required of him as a trustee, having regard to the provisions of the trust deed conferring on him any power, authority or discretions. This section enacts a statutory provision making void all clauses in a trust deed exempting the trustee from such liability.

 

(d) Securities and Exchange Board of India (SEBI) Regulations In additikon to the above provisions, SEBI has laid down the duties of a debenture trustee under Regulation 15 of the Securities and Exchange Board of India (Debenture Trustees) Regulations, 1993. The relevant part is as under: