(1) Before nominating a person to be a member of the Board, the Central Government or the State Government, as the case may be, shall satisfy itself that the person will have no such financial or other interest as is likely to affect prejudicially the exercise or performance by him of his functions as a member of the Board, and the Central Government or the State Government, as the case may be, shall also satisfy itself from time to time with respect to every member of the Board nominated by it that he has no such interest; and any person who is or whom the Central Government or the State Government, as the case may be, proposes to nominate, and who has consented to be, a member of the Board shall, whenever requested by the Central or State Government so to do, furnish to it such information as that Government considers necessary for the performance by it of its duties under this sub-section.
(2) A nominated member who is in any way, directly or indirectly, interested in a contract made, or proposed to be made, by the Board shall, as soon as possible, after relevant circumstances have come to his knowledge, disclose the nature of his interest at a meeting of the Board and the disclosure shall be recorded in the minutes of the Board and the member shall not take any part after the disclosure in any deliberation or decision of the Board with respect to that contract.