26. Submission of programme of activities and financial estimates.—(1) A Food Corporation
shall, before the commencement of each year, prepare a statement of programme of its activities during
the forthcoming year as well as a financial estimate in respect thereof.
(2) The statement prepared under sub-section (1) shall not less than three months before the
commencement of each year, be submitted for approval—
(a) in the case of the Food Corporation of India, to the Central Government;
(b) in the case of a State Food Corporation, to the Food Corporation of India.
(3) The statement and the financial estimate of a Food Corporation referred to in sub-section (1) may,
with the approval of the Central Government, in the case of the Food Corporation of India, or with the
approval of the Food Corporation of India in the case of a State Food Corporation, be revised by the Food
Corporation.
27. Borrowing powers of Food Corporation.—1
[(1) A Food Corporation may, for the purpose of
carrying out its functions under this Act—
(a) take advances against stocks of foodgrains or other foodstuffs held by it, or borrow money—
(i) from any scheduled bank, or
(ii) from any other bank or financial institution approved by the Central Government in this
behalf, or
(iii) from any other authority, organisation or institution or from the public on such terms and
conditions as may be approved by the Central Government; or
(b) issue and sell bonds and debentures carrying interest at such rates as may be fixed by the
Central Government at the time the bonds or debentures are issued:
2
[Provided that the amount borrowed by a Food Corporation under clause (b) shall not at any time
exceed ten times the paid-up capital and the reserve fund established under section 33.]]
(2) The Central Government may guarantee the loans and advances taken by a Food Corporation
under sub-section (1) as to the re-payment of principal and the payment of interest thereon and other
incidental charges.
3
[(3) A Food Corporation may, for the purpose of carrying out its functions under this Act, also
borrow money from the Central Government; and that Government may, after due appropriation made by
Parliament by law in this behalf, pay to the Food Corporation such sums of money by way of loan on
such terms and conditions as that Government may determine.]
28. Lending by Food Corporation on security of foodgrains.—A Food Corporation may lend or
advance money to any person engaged in the production of foodgrains upon the security of foodgrains or
such other security as may be prescribed, for any purpose connected with such production.
29. Power to enter into agreement for purchase of foodgrains after harvest.—(1) A Food
Corporation may enter into agreement with any grower of foodcrops for the purchase of foodgrains after
the harvest of such crops and any such agreement may provide that any sum payable by the Corporation
to the grower under such agreement shall be payable to any scheduled bank or other financing agency
nominated by the grower in this behalf to such extent as may be specified in the agreement.
1. Subs. by Act 36 of 1988, s. 2, for sub-section (1) (w.e.f. 20-8-1988).
2. Subs. by Act 27 of 2001, s. 2, for the proviso (w.e.f. 22-5-2001).
3. Ins. by Act 67 of 1972, s. 5 (w.e.f. 15-12-1972).
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(2) The scheduled bank or other financing agency referred to in sub-section (1) may, on the basis of
any agreement referred to in that sub-section, lend money to a grower of food crops who has entered into
such agreement.
30. Guarantee by Food Corporation.—A Food Corporation may, upon such terms and conditions
as it may think fit, guarantee any loan referred to in sub-section (2) of section 29, and also any other loan
raised by a grower of foodcrops, which is re-payable within a period not exceeding five years.
31. Funds of Food Corporation.—(1) A Food Corporation shall have its own fund and all receipts
of the Corporation shall be credited thereto and all payments of the Corporation shall be met therefrom.
(2) Such fund shall be applied for meeting all administrative expenses of the Food Corporation and
for carrying out the purposes of this Act.
32. Investment of funds.—A Food Corporation may invest its funds in the securities of the Central
Government or any State Government or in such other manner as may be prescribed.
33. Allocation of surplus profits.—(1) A Food Corporation shall establish a reserve fund to which
shall be credited every year such portion of its annual net profits as that Corporation thinks fit.
(2) After making provision for such reserve fund and for bad and doubtful debts, depreciation in
assets and all other matters which are usually provided for by companies registered and incorporated
under the Companies Act, 1956 (1 of 1956), the balance of its annual net profits shall be paid—
(a) in the case of the Food Corporation of India, to the Central Government, and
(b) in the case of a State Food Corporation, to the Central Government and the Food Corporation
of India in the same proportion as the capital provided by them.
1
[34. Accounts and audit.—(1) A Food Corporation shall maintain proper accounts and other
relevant records and prepare an annual statement of accounts including the profit and loss account and the
balance-sheet in such form as may be prescribed by the Central Government in consultation with the
Comptroller and Auditor-General of India.
(2) The accounts of a Food Corporation shall be audited annually by the Comptroller and AuditorGeneral of India and any expenditure incurred by him in connection with such audit shall be payable by
the Food Corporation to the Comptroller and Auditor-General of India.
(3) The Comptroller and Auditor-General of India and any person appointed by him in connection
with the audit of the accounts of a Food Corporation shall have the same rights, privileges and authority
in connection with such audit as the Comptroller and Auditor-General has in connection with the audit of
Government accounts and, in particular, shall have the right to demand the production of books, accounts,
connected vouchers and other documents and papers and to inspect any office of the Food Corporation.
(4) The accounts of a Food Corporation as certified by the Comptroller and Auditor-General of India
or any other person appointed by him in this behalf together with the audit report thereon shall be
forwarded annually by the Comptroller and Auditor-General of India to,—
(i) the Food Corporation concerned;
(ii) where the accounts relate to a State Food Corporation, also to the Food Corporation of India;
(iii) the Central Government,
and that Government shall, as soon thereafter as may be, cause the same to be laid before both Houses of
Parliament.]
1. Subs. by Act 12 of 2000, s. 2, for section 34 (w.e.f. 2-6-2000).
15
35. Annual report on the working of Food Corporations.—(1) A Food Corporation shall, as soon
as possible after the end of each year, submit to the Central Government an annual report on the working
and affairs of the Corporation.
(2) The Central Government shall, as soon as may be after the receipt of such report, cause such
report and the audit report received under section 34 1
[together with any comments thereon or supplement
thereto by the Comptroller and Auditor-General of India] to be laid before both Houses of Parliament.