153B. Declaration as to shares and debentures held in trust
¹ [153B. Declaration as to shares and debentures held in trust.

(1) Notwithstanding anything contained in section 153, where any shares in, or debentures of, a company are held in trust by any person (hereinafter referred to as the trustee), the trustee shall, within such time and in such form as may be prescribed, make a declaration to the public trustee.

(2) A copy of the declaration made under sub-section (1) shall be sent by the trustee to the company concerned, within twenty-one days, after the declaration has been sent to the public trustee.

(3)(a) If a trustee fails to make a declaration as required by this section, he shall be punishable with fine which may extend to five thousand rupees and in the case of a continuing failure, with a further fine which may extend to one hundred rupees for every day during which the failure continues.

(b) If a trustee makes in a declaration aforesaid any statement which is false and which he knows or believes to be false or does not believe to be true, he shall be punishable with imprisonment for a term which may extend to two years and also with fine.

(4) The provisions of this section and section 187B shall not apply in relation to a trust-

(a) Where the trust is not created by instrument in writing; or

(b) even if the trust is created by instrument in writing ¹[where the value of the shares in, or debentures of, a company, held in trust]

(i) Does not exceed one lakh of rupees, or

(ii) exceeds one lakh of rupees but does not exceed either five lakhs of rupees or twenty-five per cent of the paid-up share capital of the company, ²[whichever is less, or]]

³[(c) where the trust is created, to set up a Mutual Fund or Venture Capital Fund or such other fund as may be approved by the Securities and Exchange Board of India established under sub-section (1) of section 3 of the Securities and Exchange Board of India Act, 1992.]

⁴ [Explanation.-The expression "the value of the shares in, or debentures of, a company" in clause (b) means,-

(i) In the case of shares or debentures acquired by way of allotment or transfer for consideration, the cost of acquisition thereof, and

(ii) In any other case, the paid-up value of the shares or debentures.]

⁵[(5) The provisions of this section shall not apply on and after the commencement of the Companies (Amendment) Act, 2000.]

1. Substituted by Companies (AMENDMENT) Act, 1965 w.e.f. 15-10-1965

2. Subs. by Act, 5 of 1997, sec. 6, for "whichever is less" (w.e.f. 1-3-1997).

3. Inserted by Act 5 of 1997, sec. 6 (w.e.f. 1-3-1997).

4. Inserted by Companies (AMENDMENT) Act, 1965 w.e.f. 15-10-1965

5. Ins. by Act 53 of 2000, sec. 64 (w.e.f. 13-12-2000).

** Companies (AMENDMENT) Act, 1963 wef. 1/1/1964