Agriculture and Rural Development Bank and the Trustee.

Issue of debentures.—

1. (1) With the previous sanction of the State Government and the Trustee, and subject to such terms and conditions as the State Government may impose, the State Agriculture and Rural Development Bank in the discharge of its function as an Agriculture and Rural Development Bank may issue debentures of such denominations, for such period, and at such rates of interest, as it may deem expedient on me security of mortgages, instruments of hypothecation, guarantee, pledge or charge created in favour of the Bank, or mortgages, instruments of hypothecation, guarantee, pledge or charge to be acquired or partly on mortgages or on any of the aforesaid instruments held and partly to be acquired, and properties and other assets of the State Agriculture and Rural Development Banks.
2. (2) Every debenture may contain a term fixing a period not exceeding thirty years from the date of issue during which it shall be redeemable, or reserving to the committee the right to redeem at any time in advance of the date fixed for debenture not less than three months notice in writing.
3. (3) The total amount due on debentures issued by the State Agriculture and Rural Development Bank and outstanding at any time, shall not exceed-
   • (a) where debentures are issued against mortgages instruments of hypothecation, guarantee pledge or charge held, the aggregate of
     • (i) the amounts due on the mortgages 4and any or all of the aforesaid instruments;
     • (ii) the value of the properties and other assets transferred or deemed to have been transferred under section 121 by the Primary Agriculture and Rural Development Banks to the State Agriculture and Rural Development Bank and subsisting as such time; and
     • (iii) The amounts paid under the mortgages and the other instruments aforesaid and the unsecured amounts remaining in the hands of the State Agriculture and Development Bank or the Trustee at the time;
   • (b) Where debentures are issued otherwise than on mortgages or the instrument aforesaid held, the total amount as calculated under clause (a) increased by such portion of the amount obtained on the debentures as is not covered by a mortgage instrument of hypothecation, guarantee, pledge or charge.