Section 12 of The State Bank of India Act, 1955
Notwithstanding anything contained in the Acts hereinafter mentioned in this section, the shares of the State Bank shall be deemed to be included among the securities enumerated in section 20 of the Indian Trusts Act, 1882 (2 of 1882), and also to be approved securities for the purposes of the Insurance Act, 1938 (4 of 1938), and the 1[Banking Regulations Act, 1949 (10 of 1949)].
Summary
- State Bank of India shares are legally declared as approved securities.
- They are deemed to be included among the securities enumerated in section 20 of the Indian Trusts Act, 1882.
- They are approved securities for the purposes of the Insurance Act, 1938.
- They are approved securities for the Banking Regulation Act, 1949.
- This status applies notwithstanding anything contained in those three specified acts.
Practical examples
FAQ
1. What does it mean for State Bank of India shares to be approved securities?
It means these shares are legally recognized as safe and authorized investments for specific entities like trusts, insurance companies, and banks, which are normally restricted in where they can invest.
2. Which specific laws are affected by Section 12?
The three laws mentioned are Section 20 of the Indian Trusts Act, 1882, the Insurance Act, 1938, and the Banking Regulation Act, 1949.
Test yourself
Q1.Under Section 12 of The State Bank of India Act, 1955, how are the shares of the State Bank treated under the Indian Trusts Act, 1882?
Q2.Under Section 12 of The State Bank of India Act, 1955, for which of the following regulatory laws are these shares classified as approved securities?
Q3.Under Section 12 of The State Bank of India Act, 1955, which specific section 20 is cross-referenced regarding approved securities?
Q4.Under Section 12 of The State Bank of India Act, 1955, what is the legal effect of the notwithstanding clause used in the provision?