One Time Settlement Scheme for Margin Money Loan

INDUSTRIES (B) DEPARMENT

G.O. (Rt) No.805/2002/ID Dated, Thiruvananthapuram 7-9-2002
Read:- Letter No.FC1/15411/2000 dated 6-4-2002 from the Director of Industries & Commerce, Thiruvananthapuram.

O R D E R

1 The Director of Industries & Commerce has been operating margin money loan scheme to assist the deserving entrepreneurs in setting up small-scale industrial units since 1979. In normal course the margin money loan granted under the scheme is to be repaid in 16 equal quarterly installments, after 4 years from the disbursement and the repayment is to be completed within 8 years period. But due to many factors some units fail to do so and are unable to repay the amount due to Government. Many entrepreneurs who have taken the margin money loan from Industries Department have approached Government with the request that they are willing to repay the full principal amount due to Government, if the portion of interest and penal interest is waived. As a large number of such cases came before the Government, it has been decided to evolve a scheme for One Time Settlement similar to the schemes implemented by other financial institutions.

2. The Director of Industries & Commerce has forwarded the proposal for One Time Settlement Scheme as per the letter read above. Government have examined the scheme in detail and are pleased to accord sanction for the One Time Settlement Scheme for Margin Money Loan as appended herewith.

By Order of the Governor,
G. Padmakumari Amma
Additional Secretary to Government.

APPENDIX
1. For cases more than 10 years old.

i) All cases where Revenue Recovery proceedings were taken by Industries Department as on date of this order will be eligible for concessions up to a maximum of 100% of penal interest and 50% of total interest due.

ii) All period over cases will also be eligible for concessions up to a maximum of penal interest and 50% of total interest due.

iii) Cases where interest and penal interest, if any, have been remitted in full and at least 75% of principal have been remitted and if the balance outstanding is only 25% of principal, interest and penal interest accrued thereon, shall be exempted in full from payment of interest and penal interest.

iv) In case where there is no industrial and other assets to clear the dues, except a residential house (not more than one) the exemption shall be for the entire interest and penal interest. The party need only pay the principal.

2. Cases more than 5 years but less than 10 years old.

i) All cases where Revenue Recovery Proceedings were taken by Industries Department as on date of this order will be eligible for concessions up to a maximum of 100% of penal interest and 25% of total interest due.

ii) All period over cases will also be eligible for concessions up to a maximum of penal interest and 25% of total interest due.

iii) Cases where interest and penal interest, if any, have been remitted in full and at least 75% of principal and due is only 25% principal, interest and penal interest, the exemption is for interest and penal interest in full

iv) In case where there is no industrial and other assets to clear the dues, except a residential house (not more than one) the exemption shall be for the entire interest and penal interest. The party need only pay the principal.

3. Cases below 5 years old.
i) All cases where Revenue Recovery proceedings were taken by Industries Department as on date of this order will be eligible for concessions of full exemption on penal interest and 10% concession on interest due.

ii) In cases where the balance due is only 25% principal, interest and penal interest thereon, such entrepreneurs need to remit only the principal. This is applicable also in cases where there is no industrial and personal assets (other than one residential building) irrespective of remittance made but however the entire principal due shall be remitted.

4. The concession mentioned above shall be made applicable only to those who pay the amount, from the date of this order under One Time Settlement within 3 months and those who pay it voluntarily.

5. The persons shall submit an application to the General Manager, District Industries Centre and the General Manager shall intimate which category the party belongs within five days positively.

6. The concessions under these rules shall be applicable only to those entrepreneurs who pay the amount within a period of three months from the date of this order.

7. The General Manager, District Industries Centre is competent to withdraw Revenue Recovery proceedings if the entrepreneur is remitting the amount under the scheme. In case where the entrepreneur shows willingness, the General Manager, District Industries Centre can request the District Collector to keep in abeyance the Revenue Recovery action already initiated. If entrepreneur pay the entire amount Revenue Recovery proceedings can be withdrawn.

8. The asset valuation can be made by competent Revenue Authority. General Manager, District Industries Centre is bound to accept the same.

9. 10 years old, 5 years old, below 5 years etc., mentioned in these guidelines are to be calculated from the starting date fixed for the payment of principal.

10. Units running on net profit at least for a period of 6 months continuously for the period from 1-4-98 shall not be eligible for the assistance under the scheme.

11. The scheme is not continuous. It is One Time Scheme.