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NHB(ND)/ DRS/Pol.Circular .61/ 2013-14April 7, 2014

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• • NATIONAL\.,.- HOUSING BANK~s * ••

The Chief Executives of the Registered Housing Finance Companies • *I

Dear Sir/MadaJ,I

I Reserve Fund under Section 29C of the NHB Act, 1987

As you are aware that Section 29C (1) of the National Housing Bank Act, 1987 requiresevery housing firiance company to create a Reserve Fund and transfer therein a sum not lessthan twenty perdent of its net profit every year, as disclosed in the profit and loss accountbefore any dividend is declared. The provision also provides that a housing financecompany creating and maintaining any special reserve in terms of Section 36(1) (viii) of theIncome Tax Act, 1961 may take into account any sum transferred by it for the year to suchspecial reserve for the purposes of Section 29C. Further, Section 29C(2) of the NHB Actprovides that no~appropriation of any sum from the reserve fund including any sum in thespecial reserve which has been taken into account for the purposes of reserve fund in termsof sub-section (1), shall be made by such company except for the purpose as may bespecified by the National Housing Bank from time to time and every such appropriationshall be reported to the National Housing Bank within twenty-one days from the date ofsuch withdrawal.

2. It is observed that there is no uniformity in the matter of presentation of this ReserveFund in the annu~1 accounts of the housing finance companies. Consequently, need is felt toprovide for the n{anner in which this item is to be presented in the annual accounts whichbrings more clarity and uniformity. Keeping this in view, the following format is devised forsuch presentation in the annual accounts under the heading 'Notes forming part of thefinancial statemerits' from the financial year 2013-14.

CurrentYear

PreviousYear

Wholly owned by Reserve Bank of IndleCore 5-A, 4th Floor, India Habitat Centre, Lodhl Road, New Delhi-110003Phone: PBX 011-2464 9031-35 Fax: 011-2464 6988, 2464 9041Website: www.nhb.org.in E-mail: ho@nhb.org.in Gram: NIWAS Bank

Reserves & Sur IusStatutonj ReserVe(As er Sectioll 29(: 0 ti,e National HOI/sill BalikAct, 1987)o enin Balance xxxx.xx xxxx.xxAddition durin' the xxxx.xx xxxx.xxA ro riation durin ear xxxx.xx xxxx.xxClosin Balance xxxx.xx XXXX.xx

3. As mentiObed above, Section 29C(2)of the NHB Act also refers to appropriation fromsuch Reserve Fund including any sum in the special reserve under section 36(I)(viii) of theIncome Tax Act, 1.961which has been taken into account for the purposes of Reserve Fund.Therefore, it is al~o essential that information in this regard is also clearly provided in the

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~ fit; 3fT1«liT~ ~ fit; <T.3lT.~ ~, 1987 <l\'r 'trm 29~(1) <);-~ ~ 3llCIffi film ~I

~ 1T<O3!Till1n ~ <!iTfc'rn'rur <iit<lT 3ffi' ~ 0IT:l13ffi' ;;Tfo'l ~ al ~ OITmqr <l\'rm.m <t lJfrQ<l>C fIl;m m \'J; ~ ~ ~ ~ f<'r<ror0IT:l1<l\'r ~'(<1('1Ji <lRr t;rf<;qf(1 <Tft'T3i<lft1 <iit<lT ~

~I ~ ~ all~ 3ft UlCR'\llT ~ fit; 31TlI<ll{ ~, 1961 <l\'r 'trm 36 (1) (viii) <);-~ ~

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(~ m ~~, 1987 <l\'r 'trm 29~ <);-~)3f~ q)1'f I xxxx.xx xxxx.xx

~<);-~~ xxxx.xx xxxx.xx

~ <);-~ fc1fC'i1I1JI xxxx.xx xxxx.xx,

~q)1'f I xxxX.xx xxxx.xx

3. 5q{lif('1 <);-~, 31TlI<ll{~ 1961 <l\'r 'trm 36 (1) (viii) <);-~ filq)1'f 3!Till1n ~ al ~3ft <Tft'T$ ;;IT • ~ <);-3tq'lj' ~ ~ <JT$'~, 1Mr 3!Till1n ~ <t fc1fC'illlJI <);-Fow <T.3fT.~

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annual statements. Accordingly, it has been decided that the annual statements shall alsocontain the folldwing in the Notes forming part of the financial statements:

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Particulars ,

AmountBalance at the beginning of the year

a) Statutory Reserve uls 29C of the National Housing Bank Act, 1987 xxxX.xxb) Amount of special reserve uls 36(I)(vii'i)of Income Tax Act, 1961 xxxx.xx

takeli into account for the purposes of Statutory Reserve underSection 29C of the NHB Act, 1987

c) Total I xxxx.xxAddition: IAppropriation IWithdrawal during the yearAdd: a) Amount transferred ul s 29C of the NHB Act, 1987 xxxX.xx

b) Amount of special reserve uls 36(I)(viiJ)of Income Tax Act, 1961 xxxX.xxI

taken into account for the purposes of Statutory Reserve underSection 29C of the NHB Act, 1987

Less: a) AmoUnt appropriated from the Statutory Reserve ul s 29C of the xxxx.xxNHB Act, 1987b) Amount withdrawn from the Special Reserve ul s 36(I)(viii) of xxxx.xxIncome Tax Act, 1961 which has been taken into account for thepurpose of provision ul s 29C of the NHB Act, 1987

Balance at the end of the yeara) Statutorv Reserve uls 29C of the National Housing Bank Act, 1987 xxxX.xxb) Amoupt of special reserve ul s 36(1)(viii)of Income Tax Act, 1961 xxxx.xx

taken into account for the purposes of Statutory Reserve under• ISectIOn 29C of the NHB Act, 1987

c) Total I xxxX.xx

4. Kindly taJe note of the above and ensure compliance.I

Yours faithfully, II

(~~Executive Director

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" NATIONAL.-. HOUSING BANK

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fc'r<RuITor Bl"G IW ~ ~ ~ awl rlC;,}HI{, """" fo'lu'r<:rForm m ~f<'!; '~ fc'r<RuIT 'liT 3f~T

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'Ii.) <fl$:r 3TIcm1 ~~, 1987 ~ '4m 29<lT <t ~ ~ 3TTftil;frl"~ xxxx.xx<ST.) <T.3lT.~I~, 1987 ~ '4m 29<lT <t ~ ~ .3IRTa1rl"~ <t 3t~~ xxxx.xx

~ JTTll<li< ~, 1961 ~ '4m 36 (I) (viii)<t ~ FciillRrl ~ ~ fu~N,

.3IRTa1rl"~ ~ mw

'T.) ¥' I xxxx,xx~ <t ~ ~/FciFoill),,1O'1I~,tift 'Ii) <T.3lT.~~, 1987 ~ '4m 29<lT <t ~ .3frlit'f mw xxxx.xx

<ST)<T.3lT.~ ~, 1987 ~ '4m 29<lT <t ~ ~ .3IRTa1rl"~ xxxx.xxI

<t 3t~~ ~ 3lT'l<Ii< ~, 1961 ~ '4m 36(1)

(viii) <t ~ FciillRrl ~ ~ fu~N.3IRTa1rl"~ ~ mw

~: 'Ii) <T.3lT.~ ~, 1987 ~ '4m 29<lT <t ~ ~ .3IRTa1rl"~ xxxx.xxI~ FciFoill'i'i ~ ~ mw

<ST) <T.3lT.~~, 1987 ~ '4m 29<lT <t ~ ~ .3IRTa1rl" xxxx,xxI~ <t 13t~~ ~ 3lT'l<Ii< ~, 1961 ~ '4m

36(1) (viii) <t ~ Fciillfl:rl ~ ~ fu~N.3IRTa1rl"~ ~ ~ ~ ~ mw~ <t 3icr or ~, mw

'Ii.) <fl$:r 3lTCTffi~ ~, 1987 ~ '4m 29<lT <t ~ ~ 3TTftil;frl"~ xxxx.xx<ST.) <T.3lT.~ ~, 1987 ~ '4m 29<lT <t ~ ~ .3IRTa1rl"~ <t 3t~~ xxxx.xx

~ 3lT'l<Ii< !~, 1961 ~ '4m 36 (1) (viii)<t ~ FciillRrl ~ ~ fu~NI

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