"26. Except with the general or special permission of the Central Government or the Reserve Bank, no person resident in India shall give a guarantee in respect of any debt or other obligation or liability—
(i) of a person resident in India, and due or owing to a person resident outside India, or
(ii) of a person resident outside India.".
SEC. 1] THE GAZETTE OF INDIA EXTRAORDINARY 3 1 of 1956-
14. Section 27 of the principal Act shall be omitted.
15. In section 28 of the principal Act,—
(a) for sub-sections (1) and (2), the following sub-sections shall be substituted, namely:
"(1) Without prejudice to the provisions of section 47 and notwithstanding anything contained in any other provision of this Act or the Companies Act, 1956, a person resident outside India (whether a citizen of India or not) or a person who is not a citizen of India but is resident in India, or a company (other than a banking company) which is not incorporated under any law in force in India or any branch of such company, shall not, except with the general or special permission of the Reserve Bank, act, or accept appointment, as agent in India of any person or company, in the trading or commercial transactions of such person or company.
(2) Where any such person or company (including its branch) as is referred to in sub-section (1) acts or accepts appointment as such agent without the permission of the Reserve Bank, such acting or appointment shall be void.";
(b) in the Explanation, clause (d) shall be omitted.
16. In section 29 of the principal Act,—
(a) in sub-section (1), the words "or in which the non-rcsident interest is more than forty per cent." shall be omitted;
(b) after sub-section (1), the following sub-section shall be inserted, namely.— "(1A) A company (other than a banking company) in which the non-resident interest is more than forty per cent., shall not, except with the general or special permission of the Reserve Bank, carry on in India any activity relating to agriculture or plantation or acquire the whole or any part of any undertaking in India of any person or company carrying on any activity relating to agriculture or plantation or purchase the shares in such company.";
(c) after sub-section (4), for the Explanation, the following Explanation shall be substituted, namely:— 'Explanation.—For the purposes of this section,—
(i) "company" has the same meaning as in clause (b) of the
Explanation to section 28;
(ii) "non-resident interest" means participation in the share capital by, or entitlement to the distributable profits of, any individual or company resident outside India, or any company not incorporated under any law in force in India, or any branch of such company whether resident outside India or not.'.