For section 18 of the principal Act, the following section shall be substituted, namely:— "18. Certain provisions as to companies.—(1) Where there is served on any person resident in the States a notice in writing that the Central Government or the Reserve Bank wishes any such requirements as are hereinafter mentioned to be complied with by any such company as is specified in Explanation I [hereafter in this subsection and in sub-section (2) referred to as a foreign company] and that person can by doing or refraining from doing any act—
(a) cause the foreign company to comply with any of the requirements, or
(b) remove any obstacle to the foreign company complying with any of the requirements, or {c) render it in any respect more probable that the foreign .company will comply with any of the requirements, 'then, except so far as permission to the contrary may be given by the Central Government or, as the case may be, by the Reserve Bank, that person shall do or, as the case may be, refrain from doing that act.
(2) The requirements with respect to which a notice under subsection (1) may be given are as follows, that is to say, the foreign company shall—
(i) furnish to the Central Government or, as the case may be, to the Reserve Bank such paiticulars as to its assets and business as may be mentioned in the notice;
(ii) 3ell or procure the sale to an authorised dealer of any foreign exchange mentioned in the notice, being foreign exchange which it is entitled to sell or of which it is entitled to procure the sale;
(Hi) declare and pay such dividend as may be mentioned in the notice;
(iv) realise any of its assets mentioned in the notice in such manner as may be so mentioned;
(v) refrain from selling or transferring or doing anything which affects its rights or powers in relation to any such instruments or securities as may be mentioned in the notice.
(3) Except with-the general or special permission of the Reserve Bank, no person resident in the States shall do any act whereby a company which is controlled by persons resident in India ceases to be so controlled.
(4) Except with the general or special permission of the Reserve Bank, no person resident in the States shall lend any money either to any company (other than a banking company) which is controlled directly or indirectly by persons resident outside India elsewhere than in the territories notified in this behalf by the Reserve Bank or to any such person.
Ssu. 1] THE GAZETTE OF INDIA EXTHA ORDINARY 553
Explanation I.—The companies referred to in sub-section (1) are companies not incorporated under any law in force in the States in the case of which any of the following conditions is fulfilled:—
(a) that the company is by any means controlled (directly or indirectly) by persons resident in the States; or
(b) that more than one-half of the sums which, on a liquidation thereof, would be receivable by holders of share or loan capital, would be receivable directly or indirectly by, or for the benefit of, persons resident in the States; or
(c) that more than one-half of the assets which, on a liquidation thereof, would be available for distribution after the payment of creditors, would be receivable directly or indirectly by, or for the benefit of, persons resident in the States; or
(d) that more than one-half—
(i) of the interest payable on its loans and loan capital, if any, or
(ii) of the dividends payable on its preference share capital, if any, or (Hi) of the dividends payable on its share capital, if any, not being preference share capital, is receivable directly or indirectly by, or for the benefit of, persons resident in the States.
Explanation II.—•Where the identity of the persons by whom, or for whose benefit, any sum, assets, interest or dividends are directly or indirectly receivable depends on the exercise by any person resident in the States of a power vested in" him in that behalf, the, sum, assets, interest or dividends shall, for the purposes of this sub-section, be deemed to be receivable directly or indirectly by, or for the benefit of, persons resident in the States."