KERALA INFRASTRUCTURE INVESTMENT FUND ACT, 1999

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 KERALA INFRASTRUCTURE INVESTMENT FUND  ACT, 1999

(ACT 4 OF 2000)

CONTENTS

Preamble.

Sections:

1.   Short title, extent and commencement.

2.  Definitions.

3.  Kerala Infrastructure Investment Fund Scheme.

3A. Eligible projects.

4.  Constitution of Board.

5.  Term of office of members.

5A. Meetings of the Board.

6.   Powers and Functions of the Board.

6A. General powers of the Board.

6B. Executive Committee.

6C. Fund Trustee and Advisory Commission (FTAC).

6D. Functions of  Fund Trustee and Advisory Commission.

6E. Powers of  Fund Trustee and Advisory Commission.

6F. Project identfication, prioritization and implementation.

7.  Contribution to the fund.

8.   Power of the Board to borrow and lend.

8A. Power of the Board to delegate.

9.  Guarantee by Government of loans. 

10.Appointment of officers and staff. 

11.Mode of recovery of money due to Board. 

12. Members of Board etc. to be public servant. 

13. Protection for acts done in good faith.

14. Power of Government to issue directions.

15.Accounts and Audit.

16.Annual report and audited statement of accounts. 

17. Power to order inquiry.

17A. Power to appoint an Inspection Authority. 



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18. Dissolution of the Board. 

19.Bar of jurisdiction of Civil Courts. 

20. Removal of difficulties.

21.Modification of the Scheme.

22. Repeal and saving.

____



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 [Translation in English of “1999-ലെ കേരള അടിസ്ഥാന സൗകര്യ നിക്ഷേപനിധി ആക്ററ്"
published under the authority of the Governor]

ACT 4 OF 2000

THE KERALA INFRASTRUCTURE INVESTMENT FUND ACT, 1999 *

AN
ACT

to provide for the constitution of a fund for investments in the infrastructure projects in the
State and for matters connected therewith or incidental thereto.

Preamble.—WHEREAS it is expedient to constitute a fund for investments in the
infrastructure projects in the State and for matters connected therewith or incidental
thereto.

 BE it enacted in the Fiftieth Year of the Republic of India as follows:—

1. Short title, extent and commencement.— (1) This Act may be called the Kerala
Infrastructure Investment Fund Act, 1999.

(2) It extends to the whole of the State of Kerala.

(3) It shall be deemed to have come into force on the 11th day of November,
1999.

2. Definitions.— In this Act, unless the context otherwise requires,—

(a) 'Board'  means  the  Kerala  Infrastructure  Investment  Fund  Board
constituted under section 4;

1[(aa) “concessionaire” means the private sector participant which has entered
into a public-private partnership;

(ab)  “concession  agreement”  means  an  agreement  entered  into  between  a
public  agency and a  private  sector  participant  for  and in  respect  of  a  public-private
partnership;

(ac) “detailed project study” means a detailed study of the project made after
the  preliminary  decision  for  investment,  in  order  to  ascertain  the  capital  cost,
technological  parameters,  description  of  the  technology  to  be  used,  technical
specifications, plan schedule to assist the financial investment, plan for implimentation
of the project and such other information as may be specified in the Scheme;

(ad) “Executive Committee” means the committee constituted under section

* Received the assent of the Governor on the 18th day of January,  2000 and published in the Kerala Gazette
Extraordinary No. 100 dated 18th January, 2000. Translation in English language published in the Kerala
Gazette Extraordinary No. 858 dated 10th  May, 2000.

1 Inserted by Act 15 of 2016 (w.e.f 19.08.2016).



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6B;

(ae) “feasibility study” means a preliminary study to assess the techinical and
financial  viability and to assess the social and environmental impact of a project for
making  a  decision  for  investment  which  shall  include  the  demand  for  services,
appropriate technology to be adopted, capital cost, time required for implementation and
such other information as may be specified in the Scheme;]

(b) 'Financial assistance' means the types of assistance specified in the
Scheme;

(c) 'Fund' means the Kerala Infrastructure Investment Fund  established under
section 3 and the scheme;

(d) 'Fund Manager' means the Fund Manager of the Board;

(e) 'Government' means the Government of Kerala;

1[(ea) “Government Company” means any company in which not less than
fifty one per cent of the paid-up share capital is held by the  Government or Central
Government or other State Governments and includes a company which is a subsidiary
of any Government Company;

(eb) “Infrastructure” means the assets or services in any one or more of the
sectors specified in the Second Schedule;]

2[(f) 'Infrastructure projects'  include projects in the sectors specified in the
Second Schedule and multipurpose projects comprising of one or more of the sectors
specified therein;]

(g)  'Local  Self  Government  Institution'  means  a  Panchayat  at  any  level
constituted under the Kerala Panchayat Raj Act, 1994 (13 of 1994) or a Municipality
constituted under the Kerala Municipality Act, 1994 (20 of 1994);

(h)  'Other  undertakings'  means  Public  Companies  established  in  the  State
under  the  Companies  Act,  1956  (Central  Act  1  of  1956)  in  joint  sector,  where  the
investment of the Government is not less than 3[twenty six per cent] of the total paid up
share capital, or societies established under Travancore-Cochin Literary, Scientific and
Charitable Societies Registration Act,1955 (XII of 1955) or the Societies Registration
Act,  1860 (Central  Act 21 of 1860) and where Government,  Local Self  Government
Institutions or any Public Sector Undertaking, as the case may be, have not less than
4[twenty six per cent]  of interest in its assets, ownership and management;

(i) 'Public Sector Undertakings' means any Government Company established
in the State under the Companies Act, 1956 (Central Act 1 of 1956) or a Co-operative
Society registered or deemed to have  been registered under  the Kerala  Co-operative

1 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).
2 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).
3 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).
4 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).



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Societies Act, 1969 (21 of 1969) where the Government holds not less than 1[fifty one
per cent] of the share capital, and substantial control over its management and includes
public undertakings established under a statute;

2[(ia)  “pirvate  sector  participant”  means any person or  entity other than a
public agency or the Central Government or a public sector undertaking of the Central
Government;

(ib) “project” means an Infrastructure Project and includes both physical and
social Infrastructure Projects;

Explantion:—For  the  pupose  of  this  clause  'physical  infrastructure  projects'  means

projects primarily intended for creation of tangible assets and 'social infrastructure
projects' means intangible social assets such as schools, social services etc.

(ic)  “public-private  partnership”  means  an  arrangement  between  a  public
agency  and  a  private  sector  participant  for  providing  infrastructure  which  includes
investment, design, development, construction, maintenance or operation undertaken by
the private sector participant,  wherein risks are allocated between them such that the
private sector participant takes the risks beyond the stage of design, construction and the
payment for the services are performance linked, in the form of user charges, annuities or
unitary payment;

(id) “public agency” means any department of the Government or the Central
Government  or  other  State  Governments   or  public  sector  undertaking,  Government
Company, statutory board formed by the Government or the Central Government or the
other State Governments, Local Self Government Institutions, co-operative institution,
university, any society or trust formed, owned or controlled by the Government or the
Central Government or other State Governments;]

(j) 'Schedule' means the Schedule to this Act;

(k) 'Scheme' means the scheme framed under this Act;

3[(ka)  “Special  Purpose  Vehicle”  means  the  Public  Agency,  Public  Sector
Undertaking or Public-Private Partnership formed for executing any work financed by
the Board;

(kb) 'sponsoring agency' means the public agency designated by the Board to
implement a project through public-private partnership;]

(1) 'State' means the State of Kerala ;

4[(la) “State support” means the support extended by the Government to a
concessionaire, which may include, — 

1 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).
2 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).
3 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).
4 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).



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(i)   subsidy or capital grant not exceeding such proportion of the coast of
the project, as may be specified in the sheme;

(ii)  equity;

(iii) loans;

(iv) guarantee by the Government;

(v)  opening and operation of escrow account;

(vi) conferment of right to develop any land;

(vii) incentives in the form of exemption from the payment of, or deferred
payment of,  any tax or fees levied under any law or such other incentives,  as may be
specified, in the Scheme;]

(m) 'Undertakings' means public sector undertakings or other undertakings;

1[(ma)  “user  levy”  means  user  charge  or  fee  or  any  other  amount,  by
whatever name be called, payable by the user of an infrastructure facility;]

(n) 'Year' means the financial year.

3. Kerala Infrastructure Investment Fund Scheme.—(1) The Government may, by
notification  in  the  Gazette,  frame  a  scheme  to  be  called  the  'Kerala  Infrastructure
Investment Fund Scheme' for the establishment of a fund under this Act for investments
in the infrastructure projects of the State and there shall be established, as soon as may
be after the framing of the scheme, a fund in accordance with the provisions of this Act
and the scheme.

2[(1A) The fund corpus shall comprise of the net total of the amounts specified in
sub-section (2) hereunder.]

(2) There shall be credited to the fund,—

3[(a) the amounts released to the Board from the budget allocation under section
7;] 

(b)  the amount borrowed by the Board under section 8;

(c) grants or loans or advances made by 4[xxx] any institution;

(d)  any  amount  raised  by  the  Board  from other  sources  to  augment  the
resources of the Board;

1 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).
2 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).
3 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).
4 Omitted by Act 15 of 2016 (w.e.f. 19.08.2016).



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(e) any other amount which, under the provisions of the scheme, shall be
credited to the fund.

(3) The fund shall vest in, and be administered by the Board constituted under
section 4 1[in such manner as may be specified in the scheme.]

 (4) The fund may be utilised for all or any of the following purposes namely:—

(a) to finance 2[or leverage] investments in infrastructure projects in the State;

  (b) to provide financial assistance to public sector undertakings and other
undertakings for their investments in infrastructure projects;

3[(c) to redeem the bonds or debentures or any other financial instrument
used to raise resources for the Fund and to repay the loans availed from co-operative
banks,  other  commercial  banks  and  any  institution  to  implement  the  infrastructure
project;]

4[(ca) to finance or leverage investments and financial instruments relating
to land acquisitions for infrastructure projects and other Government purposes;

  (cb) to provide funding for projects that face significant funding barriers
because of the need to combine resources across multiple sectors or parts thereof;

(cc)  to  provide  direct  loans  advances  and  loan  guarantees  to  eligible
projects,  programmes of any legal entity or instrumentality  including public  or other
undertaking for their investments in infrastructure projects identified by the State;]

(d) for implementation of any other purpose specified in the scheme.

5[(5) All moneys specified in sub-section (2) other than money contributed by
Government under section 7,  shall  be deposited with the approval of the Board in a
Nationalized Bank or in such other prudent investment:

Provided that any portion of the money contributed by the  Government  under
section 7 may be deposited or invested in any Nationalized Bank or in sovereign bonds
of  the  Union  or  States  or  in  such other  prudent  investment  other  than  in  the  State
Treasury.

Explanation:— For the purpose of this sub-section, 'prudent investment' shall mean
those investments which carry the highest rating from the appropriate regulatory body or
credit rating agency for that class of investment;]

(6)  Subject to the provisions of this Act, the scheme framed under sub-section

1 Added by Act 15 of 2016 (w.e.f. 19.08.2016).
2 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).
3 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).
4 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).
5 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).



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(1) may provide for all or any of the matters specified in sub-section (4) and in the 1[first
schedule;]

2[(6A) The accounts of the Board shall be operated by the Fund Manager:

Provided that the Board may delegate the powers for operation of accounts to one
or more officers of the Board and may set appropriate financial limits as it deems fit.]

(7) The scheme shall be laid, as soon as may be, after it is framed, before the
Legislative Assembly while it is in session for a total period of fourteen days which may
be in one session or in two successive sessions, and if, before the expiry of the session in
which it is so laid or the session immediately following, the Legislative Assembly makes
any modification in the scheme, the scheme shall  thereafter have effect only in such
modified form, so however that any such modification shall be without prejudice to the
validity of anything previously done under the scheme;

3[(8) The Government shall lay before the State Legislative Assembly along with
the presentation of the Annual budget the following documents,—

(a) a statement of the sources and application of the funds of the Board;

(b) a certificate from the Fund Trustee and Advisory Commission to the effect
that  the  funds of  the  Board  have  been  deployed for  the  purposes  intended and that
surplus funds have been managed as laid down under the provisions of this Act.]

4[3A.  Eligible projects.—(1) Projects eligible for financial assistance from the fund
shall be the projects referred to the Board by the Government and approved by the Board.

(2) Eligible projects shall be of a value exceeding  ₹ 100,00,00,000 (Rupees One
Hundred Crore) implemented by a public agency:

Provided that for the purpose of assessing the value, projects not less than Rupees Ten
Crore may be grouped into tranches, each of which has to satisfy the stipulation on the value
specified in sub-section (2):

Provided further that  the Government  may,  by general  or special  order,  apply the
provisions of this Act to any public-private partnership project:

Provided  also  that  it  shall  not  apply  to  any  project  undertaken  by  the  Central
Government or any public undertaking of the Central Government independently, except as a
joint venture with the State Government.

Explanation:— For the pupose of this sub-section, in the case of a public-section, in the
case of a public-private partnership project, 'project value' means, where the private sector
participant is,—

1 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).
2 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).
3 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).
4 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).



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(i) required to make capital investment, the value of the asset or facility to be
created including cost  of  land,  if  the cost  of  land is  to  be borne by the private  sector
participant; or

(ii) not required to make capital investment, the current replacement value of the
asset or facility, excluding land, whose operation and maintenance shall be the responsibility
of the private sector participant.]

4. Constitution of Board.— (1) The Government may, by notification in the
Gazette, constitute with effect from such date as may be specified therein, a Board to be
called "the Kerala Infrastructure Investment Fund Board" for the administration of the
fund and to supervise or carry out the activities financed from the fund.

(2) The Board shall be a body corporate by the name aforesaid, having perpetual
succession and a common seal and shall by the said name sue or be sued.

1[(2A) The headquarters of the Board shall be Thiruvananthapuram.]

2[(3) The Board shall consist of the following members, namely:—

(a)  Chief Minister ..  Chairperson

(b) Minister for Finance .. Vice-Chairperson

(c) Vice-Chairman, State planning Board ..   Member

(d) Chief Secretary      ..  Member

(e) Secretary (Law)  ..     Member

(f)  Secretary (Finance)     ..     Member

(g) Secretary (Finance Resources) ..     Member

(h) Seven independent members
who  are  experts,  who  have
worked  in  an  institution  of
national  repute  in   one  or
more of the areas of Finance,
Banking, Economics   ..    Members

(i) Chief Executive Officer ..    Member Secretary

Explanation:— For the purposes of the provisions of this Act the term 'Secretary’,
shall denot Additional Chief Secretary, Principal Secretary, Secretary or Special Secretary to
Government, as the case may be;]

1 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).
2 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).



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3[(4) The Board may, at the discretion, of the Chairperson seek the participation of
any other Minister or Secretary of any Department whose project is under consideration of
the Board for financing.]

2[(5) xxxx

3(6) xxxx

4(7) xxxx]

5. Term of office of members.— (1) A member appointed under clause (h) of sub-
section (3) of section 4 shall hold office during the pleasure of the Government.

(2) Any member appointed under clause (h) of sub-section (3) of section 4 may
resign his membership by giving notice in writing to the Government but shall continue
in office until his resignation is accepted by the Government.

5[5A. Meetings of the Board.—(1) The Board shall meet at such time and place

and shall  observe  such rules  of  procedure in  regard to  transaction of  business  at  its
meetings, as may be specified in the Scheme.

(2) The Chairperson shall preside over the meetings of the  Board. When the
Chairperson of the Board is absent, the Vice-Chairperson shall preside over the meetings.
The Chief Executive Officer shall be the Convener of the Board meetings.

(3) Agenda of a meeting of the Board shall be decided by a majority of two-
third of the votes of the members present and voting and in case of any equality of votes, the
person presiding shall have a second or casting vote.

(4)  The  quorum for  a  meeting  shall  be  eight  and  atleast  one  independent
member shall attend the meeting.

(5) All investment decisions taken in the Board meetings in the absence of the
Chairperson shall be ratified by the Chairperson before implementation.

(6)  The  members  of  the  Board  may,  with  the  permission  of  the
Chairperson, attend the meetings of the Board through video conferencing.

(7) No act or proceedings of the Board shall be invalid by reason only of
the existence of  any vacancy amongst  its  members  or any defect  in the constitution
thereof.]

6[6.  functions of the Board.—Subject to the provisions of this Act, the Board shall
have the following  functions, namely: —

3 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).
2 Omitted by Act 15 of 2016 (w.e.f. 19.08.2016).
3     Omitted by Act 15 of 2016 (w.e.f. 19.08.2016).
4     Omitted by Act 15 of 2016 (w.e.f. 19.08.2016).
5 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).
6 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).



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(a)  approve the selection of eligible projects for financial assistance through the
Fund;

(b)  authorise  the  mobilization  of  resources  for  augmentation,  maintenance  and
utilization of the Fund;

(c) approve the public agency which shall implement a project through public sector
mode or through a Public-Private Partnership;

(d) co-ordinate the efforts of the Government, any public agency and sponsoring
agencies in matters regarding the development of the infrastrucrure in the State including
Public-Private Partnership projects;

(e) identify sources of financing, and approve suitable modes of raising  resources;

(f) identify bottlenecks in the Projects and recommend policy intiatives to rectify the same;  

(g) formulate and recommend policies related to eligible projects so as to ensure that
project risks are identified and allocated between the stakeholders;

(h) perform such other functions as may be entrusted to it by the Government.

6A. General powers of the Board.— The Board shall, for the purpose of carrying out
its functions under this Act, have the following powers, namely:-

(a) to call upon any public agency or concessionaire or any person to furnish
information in regard to any project;

(b) to  inspect  or cause to inspect  and monitor  any Project  and its  execution,
operation and management;

(c) to regulate its own procedures;

(d) to approve proposal and instruments to mobilise and deploy resources of the
Fund;

(e) to sanction financial assistance based on eligibility norms as per the Scheme;

(f) to approve the Investment Prospectus, operational guidelines and oversight
mechanism;

(g) to recover the amounts due to the Board from the assisted projects, project
authority, undertakings, public agency and concessionaire as per the recovery schedule;

(h)  to  modify,  revise  or  reschedule  the  recoveries  as  may  be  considered
appropriate;

(i) to opt for revenue recovery proceedings, if found necessary and appropriate,
against any of the assisted project, project authority, undertakings, public agency and/or
concessionaire in the interest of the Board;



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(j) to disburse all expenses relating to the administration of the Fund including
travel, interest on borrowings, fees, professional charges and other expenses;

(k) to invest any surplus fund of the Board, as may be available from time to
time, in such manner as may be specified in the Act and in the Scheme and also to relaise
the returns due from such investments;

(l) to review on a periodic basis the performance of any assisted project, project
authority, undertakings, public agency and/or concessionair receiving any assistance or
loan from the Fund;

(m) to enter into Memorandum of Understanding or performance contract with
any assisted project, project authority, undertakings, public agency and/or concessionaire
under the purview of this Act, on behalf of the Government;

(n) to enter into contracts on behalf of the Board;

(o) to exercise such powers and functions as may be specified in the Scheme;

(p) to exercise such powers and perform such functions as may be conferred on
or entrusted to it by the Government for carrying out the purposes of this Act;

(q) to do all acts neccessary for and incidental to the carrying out of the function
entrusted or delegated to it;

(r) to certify reports submitted to the State Legislature;

(s) to certify other publications of the Fund including investment prospectus and
tender documents.

6B. Executive Committee.— (1) There shall be an Executive Committee which shall
exercise such powers and perform such functions as may be delegated to it by the Board.

(2) The Executive Committee shall consist of the following members, namely:- 

(a) Minister for Finance  .. Chairperson

(b) Chief Secretary  ..  Member

(c) Secretary (Law)   .. Member

(d)  Secretary (Finance) .. Member

(e) Secretary (Finance Resources) .. Member

(f)  Three independent members 
of the Board, to be nominated 
by  the Government .. Members

(g) Chief Executive Officer .. Member



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(3) The Secretary to Government of the administrative department in Government
concerned with the project proposal placed before the Board for consideration shall be a
special invitee to the meetings of the Executive Committee.

(4) The decision making shall be by a majority of not less than two-thirds of the
members present and voting.

(5) The quorum for a meeting shall be five.

(6) The members of the Executive Committee may, with the permission of the
Chairperson, attend the meeting through video conferencing.

(7)  The  Chief  Executive  Officer  shall  be  the  Secretary  of  the  Executive
Committee.

6C.  Fund  Trustee  and  Advisory  Commission(FTAC).— (1)  The  Board  shall  by
general  order,  constitute  with  effect  from  such  date  as  may  be  specified  therein,  a
Commission to be called the 'Fund Trustee and Advisory Commission'.

(2) The Commission shall comprise of not less than three and not more than five
members including a Chairperson.

(3) The term of office of the Commission shall be for a period of two years.

(4) The members shall hold office at their pleasure and shall not be removed by
Government  or  the  Board except  on grounds  of  conviction  on any criminal  charges
involving moral turpitude or corruption by a court of law.

(5) The members  shall  be  experts  with proven experience at  the national  or
international  levels  in  any  of  the  fields  of  banking,  financial  regulation,  financial
markets, administration or economics.

(6) The Board shall nominate one of the members as the Chairperson of the
Commission.

(7) The members of the Fund Trustee and Advisory Commission may, with the
permission of the Chairperson, attend the meeting through video conferencing.

(8) The Commission shall meet once before September and February of each
financial year and as many times, as it deems fit for carrying out its functions.

(9) The Chief Executive Officer shall be the Secretary to the Commission.

6D. Functions of Fund Trustee and Advisory Commission.— (1) The Commission
shall act as the trustee of the fund and help to ensure that all investments of the fund
serve the purpose and intent of the Act and that there is no diversion of funds of the
Board.

(2) The Commission shall with the approval of the majority of members issue
"Fidelity Certificate" every six months certifying that the application of funds and the



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investment of surplus funds are in conformity with the Act and Scheme.

6E.  Powers of Fund Trustee and Advisory Commission.— The Fund Trustee and
Advisory Commission shall have the following powers, namely:-

(a) to call for periodical reports from the Board;

(b) to call for any documents in possession of Board necessary for the discharge
of its functions under this Act;

(c) to supervise the implementation of the conditions regarding creation of the
securities by the Board for the purpose of raising funds;

(d) to carry out such acts, as are necessary, for the protection of interest of the
holders of the securities issued by Board;

(e) to do all  things necessary to resolve the grievances of the holders of the
securities issued by the Board;

(f) to ascertain that the funds necessary to discharge the interest and principal
amount payable in respect of the securities is available with the Board as stipulated under
this Act;

(g)  to  ascertain  that  the  funds  so  available  with  the  Board  are  deployed  in
prudential investments;

(h)  to  direct  the  Chief  Executive  Officer  to  convene  meetings  of  the  Fund
Trustee and Advisory Commission as many times, as it deems appropriate, in addition to
the two meetings specified in sub-section (8) of section 6C:

Provided  that  the  Chairperson  shall  issue  such  directions  either  on  his
own or at the request of at least two members.

6F.  Project identification, prioritization and implementation.— (1) On identifying
or conceptualizing a project to be developed, managed and operated in the State, the
Board, on its own accord or based on a study or survey caused to be conducted or based
on inputs received from a third party, may seek the views of the public agency concerned
thereon:

Provided that if the public agency does not furnish its views within thirty days from
the date of receipt of the said communication from the Board, it shall be deemed that the
public agency has no view to offer.

(2) Any Government Department may also identify or conceptualize a project to
be developed, managed and operated in the State and send the proposal thereafter to the
Board for its recommendation. The Board shall scrutinize, evaluate and where more than
one such proposal is received, prioritize the same.

(3) The Board, on receipt of the views of the public agency under sub-section (1)
or proposal from any Government Department under sub-section (2), shall examine the



15

project proposal with reference to the cost benefit analysis of the project including the
socio-economic  cost  benefit  and  shall  appraise  the  project  proposal  with  sufficient
details;

(4) Where the public agency or the Government Department has proposed a project
through Public-Private Partnership, the Board shall further examine the project with reference
to the following factors, namely:—

(a) the cost effectiveness of implementation through public-private partnership
with value for Money test, as may be specified in the scheme;

(b) the possibility of specifying project performance parameters and measuring
their outcomes;

(c) the risk sharing with the participants;

(d) the technological and managerial advantages due to participation;

(e)  the  socio-economic  factors  which  may  affect  investment  by  the
participant;

(f) compliance with regulatory norms.

(5)  The  Board,  may  cause  a  feasibility  study  of  the  proposed  project  and  afer
satisfying itself as to its feasibility, may recommend the same to the Government, indicating
specifically as to whether it may be implemented through public sector mode or through
public private partnership.

(6) The Board shall cause the details of projects recommended under sub-scction (5),
to be publíshed on íts website and on such other websites, as may be specificd in the Scheme:

Provided that the Board may, for rcasons to be recorded in writing, choose
not to publish the details of a Project.

(7) On receipt of proposal for implementatíon of the Project under sub-section (5),
the Government shall consíder the same and communicate its decision on the implementation
of the Project including the mode of its implementation, to the Board.

(8)  In  respect  of  a  Project  decided  by  the  Government  to  be
implemented  through  publíc  sector  mode,  the  Board  shall  designate  the
publíc  agency  whích  shall  implement  that  Project,  give  direction  for  its
implementatíon and monitor the progress of implementation.

(9)  If  the  public  agency  does  not  commence  the  Project  within
three  months  from  the  date  of  receipt  of  such  direction  or  expresses  its
inability  to  implement  the  Project,  for  any  reason  recorded  in  writing,  the
Board  wíth  the  approval  of  the  Govermment  may  re-examine  the  Project  as
in sub-sectíon (3) and make a fresh recommendation to the Government.

(10)  In  respect  of  Project  decided  by  the  Government  to  be



16

implemented  through  Public-Private  Partnership,  the  Board  shall  cause  the
sponsoring  agency  to  publish  the  details  of  the  proposed  projects  in  such
form  and  ín  such  manner,  as  may  be  specified  in  the  Scheme,  inviting
objections  and  suggestions.  The  sponsoring  agency  shall,  based  on  the
objections  and  suggestions,  if  any,  received,  prepare  and  submit  a  report  to
the Board within such period, as may be specified in the Scheme.

(11)  The  Board,  on  receipt  of  the  report  from  the  sponsoring
agency  under  sub-section  (10),  shall  consider  the  project  in  consultation
with  the  administrative  department  and  after  causing  the  detailed  project
study,  if  it  considers  necessary,  finalize  the  scope  and  structure  of  the
Project,  either  in  its  original  form  or  with  such  modification,  as  it  deems  fit,
also taking into account, the following aspects, namely:-

(a)  whether  the  Project  needs  any  public  financial  support,  and  if  so,  the
appropriate form of such support;

(b) the tender criteria or variables relevant for evaluation of the tender; and

(c) the appropriate concession agreement or a combination thereof, from out of
those listed in Third Schedule.]

1[7.  Budgetary  allocation  for  repayment.—  (1)  From,  time  to
time,  Government  shall  make  provision  in  the  Annual  Budget  to  defray  the
expenses  incurred  for  payment  of  annuity  or  other  repayment  obligation
incurred  in  lieu  of  section  8  and  to  meet  operational  and  administrative
expenses of the Board:

Provided  that  Government  shall  set  apart  a  share  of  the  Motor  Vehicle
Taxes  as  contribution  to  the  fund,  reckoned  on  the  basis  of  the  Motor
Vehicle  Taxes  collected  for  the  previous  year  such  share  being  ten  per  cent
in  the  first  year  and  increased  by  ten  percent  each  year  upto  fifty  per  cent
of the Motor Vehicle Tax in the fifth year:

Provided  further  that  in  addition,  the  cess  levied  on  petroleum  products
shall  also  be  contributed  to  the  Fund  by  the  Government  on  the  basis  of
the amount of cess collected during the previous year.

(2)  The  transfer  of  funds  required  for  the  successive  twelve
months  shall  be  completed  either  in  one  or  more  installments,  before  the
last working day of  December of that year:

Provided  that  the  revenue  realised  from  any  project  including  user  levy
shall  be  set-off  from  the  appropriation  so  made  at  the  end  of  the  year  and
only  the  balance  after  defraying  operational  expenses  need  be  provided  as
appropriation during the year.

(3)  The  Govemment  may  after  due  appropriation  by  law  passed  by
State  Legislature  from  time  to  time  make  grants,  advances  and  loans

1 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).



17

to  the  fund  for  the  purposes  of  this  Act,  on  such  terms  and  conditions  as
the Government may determine.]

1[8.  Power of the Board to borrow and lend.—(1)The Board may, from time to
time, with the previous sanction of the Government and subject to such conditions as the
Government may by general or special order determine, borrow any sum required for the
purposes of this Act.

(2) For the purpose of such borrowing the Board may issue any financial instrument
including General Obligation Bonds,  Revenue Obligation Bonds or any other appropriate
financial  instruments  or  raise  funds  through  any  financial  structures  including  Revenue
Bonds  with  structured  repayment  mechanism,  Land  Bonds  and  any  other  appropriate
financial instruments or by making arrangements with Banks, Multilateral Funding Agencies
or Institutions approved by the Government in that behalf.

(3) The Board may act as the sponsor for setting up infrastructure investment
structures, as are required for facilitating the mobilisation of resources for a project or
group of projects.

Explanation:—For  the  purposes  of  this  sub-section,  the  infrastructure  investment
structures may include, but are not limited to Alternate Investment Fund (AIF),
Infrastructure  Investment  Trust  (InvIT),  Mutual  Funds  and  Infrastructure
Development Fund(IDF).

(4)  The  Financial  instruments  and securities  issued by the  Board  under  this
section shall be issued, transferred, dealt with or redeemed in such manner as decided by
the Board subject to the directions of the Government.

8A.  Power of the Board to delegate.— The Board may delegate to the Executive
Committee or the Chief Executive Officer such powers and functions under this Act or
scheme as it may consider necessary for the efficient administration of the fund, subject
to such restrictions and conditions if any, as it may specify.]

9. Guarantee by Government of loans. —2[(1) The Government shall guarantee the
payment of the principal and interest of any fund proposed to be raised by the Board under
section 8:

Provided that the total guarantee issued by the Government under this Act shall not
exceed the limits set by the Kerala Ceiling on Government Guarantees Act, 2003 (30 of
2003) in force.]

(2) The Government shall, so long as any such guarantee is in force lay before
the  State  Legislature  in  every  year  during  the  budget  session,  a  statement  of  the
guarantee, if any, given during the current financial year and up to date accounts of the
total sums, if any, which have been paid out of the Consolidated Fund of the State by
reason of  any  such  guarantee  or  paid  into  the  said  fund  towards  repayment  of  any
moneys so paid out.

1 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).
2 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).



18

1[10. Appointment of officers and staff.—(1) The Board may with the approval of
Government,  create  such  posts  and appoint  such  number  of  officers  and  staff  as  it
considers necessary to assist the Board in the discharge of its functions and duties under
this Act.

(2) There shall be a Chief Executive Officer (CEO) for the Board who shall be
given  the  rank  and  status  of  a  Secretary  to  the  Government,  appointed  by  the
Government. The Chief Executive Officer shall be the Fund Manager of the Board.

(3) The Chief Executive Officer  shall  exercise the power of supervision and
control over all the officers and Staff of the Board.

(4) The method of appointment, salary and allowances and other conditions of
service of the officers and the staff appointed under sub-section (1) shall be such, as may
be specified, by the Government from time to time.]

11. Mode of recovery of money due to Board.—All sums payable by any person to
the Board or recoverable by it under this Act or the scheme and all charges or expenses
incurred in connection therewith shall, without prejudice to any other mode of recovery,
be recoverable as arrears of public  revenue due on land under  the provisions of the
Revenue Recovery Act for the time being in force.

12.  Members  of  Board  etc.  to  be  public  servant.—  Every  member  of  the  Board
2[Executive Committee, Fund Trustee and Advisory Commission], the Fund Manager and
staff of the Board appointed under sub-section (1) of section 10 shall be deemed to be
public servants within the meaning of section 21 of the Indian Penal Code (Central Act
45 of 1860).

13. Protection for acts done in good faith.— No suit or other legal proceeding shall lie
against any member of the Board or any other person in respect of anything which is done in
good faith or intended to be done in good faith under this Act or under the scheme.

14.  Power  of  Government  to  issue  directions.— (1)  Notwithstanding  anything
contained in this Act it shall be lawful for the Government to issue directions to the
Board in matters relating to State and National Policies and such directions shall  be
binding on the Board.

(2) The Government may, after consultation with the Board, give to the Board
general directions to be followed by the Board.

(3) In the exercise of the powers and performance of its duties under this Act,
the Board shall not depart from any general direction issued under sub-section (2) except
with the previous permission of Government.

15. Accounts and Audit. — (1) The Board shall cause to be maintained such
books of  accounts and other books in relation to  its  accounts and prepare an annual
statement of accounts and balance sheet in such form and in such manner as may be
specified in the scheme.

1 Substituted by Act 15 of 2016 (w.e.f. 19.08.2016).
2 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).



19

(2) The accounts of the Board shall be audited by such auditor, in such manner
and at such time as the Government may, by general or special order, direct and the
auditor so appointed shall have such powers of requiring the production of documents
and the furnishing of information in respect of such matters.

(3) The accounts of the Board as certified by the auditor together with the audit
report thereon shall be forwarded annually to the Government who may issue such
directions to the Board as they may deem fit  and the Board shall  comply with such
directions.

16. Annual report and audited statement of accounts.—(1) The annual report of the
Board shall be prepared under the direction of the Board and after approval by the
Board, a copy of the report shall be submitted to Government before the end of July
every year.

(2) The Government shall, as soon as the annual report is received, cause the
same together  with  the  audited statement  of  accounts  to  be laid on  the  table  of  the
Legislative Assembly.

17. Power to order inquiry. —(1) The Government may, at any time appoint any
person  to  inquire  into  the  working  of  the  Board  and  to  submit  a  report  to  the
Government.

(2) The Board shall give the person so appointed all facilities for the proper
conduct of the inquiry and furnish to him such documents, accounts and information in
the possession of the Board as he may require.

1[17A. Power to appoint  an Inspection  Authority.—(1)The Government  may by
general or special order, appoint an inspection authority comprising of such persons as it
deems fit  to inspect  any projects  and the documents of any Special  Purpose Vehicle
implementing the same that has been financed by the Board.

(2) Such Authority shall have the powers to call for documents from any Special
Purpose Vehicle and inspect its office, site and premises of the projects implemented by
it.]

18. Dissolution of the Board. —(1) If the Government for any reason are of opinion
that it is not necessary to continue the Board they may, by notification in the Gazette,
dissolve the Board from such date as may be specified therein.

(2) Upon the publication of a notification under sub-section (1) dissolving the
Board,

(a)  the Chairman and all the other Members of the Board shall, as from the
date of dissolution, vacate their offices as such;

(b) all the powers and functions which may, by or under the provisions of this
Act be exercised and performed by or on behalf of the Board and the Chairman shall, as
from the date of dissolution, be exercised and performed by the Government or such

1 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).



20

authority or person as they may appoint in this behalf;

(c)  all  funds  and  other  property  vested  in  the  Board  shall  vest  in  the
Government; and

(d) all liabilities legally subsisting and enforceable against the Board shall be
enforceable against the Government to the extent of the funds and properties vested in
them.

(3) Nothing in this section shall affect the liability of the Government in respect
of bonds or debentures guaranteed by the Government.

19.  Bar of jurisdiction of civil Courts. —No Civil Court shall have jurisdiction to
settle, decide or deal with any question or to determine any matter which is by or under
this Act or scheme required to be settled, decided or dealt with or to be determined by the
Government or the Board or any officer authorised by the Government or the Board.

20.   Removal of difficulties.—(1) If any difficulty arises in  giving effect to the
provisions  of  this  Act,  the  Government  may,  as  occasion may require,  by  order,  do
anything not inconsistent with this Act or the scheme made thereunder, which appears to
them necessary for the purpose of removing the difficulty.

(2)  Every  order  made  under  sub-section  (1)  shall  be  laid  before  the  State
Legislature.

21. Modification of the Scheme.—(1) The Government may, by notification in the
Gazette, add to, amend or vary the scheme either prospectively or retrospectively.

(2) Every notification under sub-section (1) shall be laid, as soon as may be after
it is issued, before the Legislative Assembly while it is in session for a total period of
fourteen days which may be in one session or in two successive sessions, and if, before
the expiry of the session in which it is so laid or the session immediately following, the
Legislative Assembly agrees in making any modification in the notification or decides
that the notification should not be issued, the notification, shall thereafter have effect
only in such modified form or be of no effect, as the case may be, so however that any
such modification or annulment shall be without prejudice to the validity of anything
previously done under that notification.

22. Repeal and saving. —(1)  The  Kerala  Infrastructure  Investment  Fund
Ordinance, 1999 (5 of 1999), is hereby repealed.

(2) Notwithstanding such repeal anything done or deemed to have been done or
any action taken or deemed to have been taken under the said Ordinance shall be deemed
to have been done or taken under this Act.



21

1[FIRST SCHEDULE

See sections  2(ac), 2(ae), 3(6), 6A(k), 6A(o), 6F(4)(a), 6F(6), 6F(10)]

MATTER FOR WHICH PROVISIONS MAY BE MADE IN THE SCHEME

1. Eligibility of undertaking for assistance

2. The purposes for which the assistance may be given

3.  Modes of assistance

4. Interest and penal charges

5. Security for the assistance

6.Appraisal and sanction procedure

7. Disbursement procedure

8. Guidelines for memorandum of understanding /performance contract

9. Recovery procedure

10. Monitoring system

11. Investment of surplus funds

12. Board meetings, 2[xxxx] fees and allowances to members of the Board

13.  The method of keeping accounts shall  be kept,  the preparation of the
budget,  the  audit  of  accounts  and  the  submission  of  reports  to  the
Government.

14.  The  procedure  for  defraying  the  expenditure  incurred  in  the
administration of the fund

3[15.xxxx]

4[15. Other information with respect to which a detailed study of the project
may be conducted after the decision for preliminary investment. 

16.  Other  information  with  respect  to  which  feasibility  study  may  be
conducted.

17. Other powers and functions of the Board.

18. Manner of investing surplus fund of the Board.

19. Value for Money Test.

1 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).
2 Omitted by Act 15 of 2016 (w.e.f. 19.08.2016).
3 Omitted by Act 15 of 2016 (w.e.f. 19.08.2016).
4 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).



22

20. The form and manner of publishing the details of proposed projects by the
sponsoring agency, the period in which the report shall be prepared and submitted to the
Board by the sposoring agency in respect of the project.

21. Websites in which details of the project to be published.]

1[22.] Any other matter which is to be provided for in the Scheme or which 
may be necessary or proper for the purpose of implementing the scheme.

2[SECOND SHEDULE

[See section 2 (eb)]

SECTORS

1.  Agriculture Infrastructure.

2.  Buildings.

3.  Development of Minor Minerals.

4.  Drinking and Industrial Water supply systems, Desalination Plants.

5.  Education related Infrastructure.

6.  Fisheries.

7.  Gas and Gas Works.

8.  Health Infrastructure.

9.  Housing including Slum Development and Development of Satellite 
towns.

10. Industrical Estates including Industrial Parks and Special Economic 
Zones.

11. Information and Communication Technology related Projects.

12. Inland Navigation and Inland Waterways.

13. Irrigation including Dams, Irrigation Structures, Canals.

14. Land Reclamation Projects.

15. Ports and Harbours.

16. Power Generation, Transmission and Distribution.

17. Roads, Bridges, including Rail over and under Bridges and By-passes.

18.Solid Waste Management.

1 Renumbered by Act 15 of 2016 (w.e.f. 19.08.2016).
2 Inserted by Act 15 of 2016 (w.e.f. 19.08.2016).



23

19.Sports and Recreation Infrastructure.

20.Tourism and Hospitality Projects.

21.Transport projects including road, rail and air transport.

22.Urban Transortation System, Bus terminals, Multi level parking facilities.

23.Waste Water, Sewerage treatment systems.

THIRD SCHEDULE

[See section  6F(11)(c)] 

NATURE OF CONCESSION AGRREEMENTS

1.  Investment or Financing related Agreements

(i) Build-Operate-and-Transfer (BOT). — A contractual arrangement whereby the
concessionaire undertakes the construction, including financing, of a given infrastructure
facility,  and the  operation  and maintenance  thereof.  The concessionaire  operates  the
facility over a fixed term during which they are allowed to charge the users appropriate
tolls, fees, rentals and charges as incorporated in the contract to enable the recovery of
investment in the Project.  The concessionaire transfers the facility to the Government at
the end of the fixed term that shall be specified in the Concession agreement.

(ii)  Build-Own-and-Operate  (BOO).—A  contractual  arrangement  whereby  the
concessionaire  is  authorized  to  finance,  construct,  own,  operate and  maintain  an
infrastructure  or  development  facility  from  which  the  concessionaire  is  allowed  to
recover thc total investment by collecting user levies from facility users. The ownership
of the land will be vested  with the Government. Under this mode, the concessionaire
owns the assets of the facility and may choose to assign its operation and maintenance to
a facility operator. The transfer of the facility to the Government is not envisaged in this
structure; however, the Government may terminate its obligations after the specified time
period.

(iii)  Build-Own-Operate-Transfer(BOOT).—  Acontractual  arrangement  whereby
the concessionaire is authorised to finance, construct, maintain and operate a Project and
whereby such Project is to vest in the concessionaire for a specified period. During the
operation period, the concessionaire will be permitted to charge user levies specified in
the  Concession  agreement,  to  recover  the  investment  made  in  the  Project.  The
concessionaire is liable to transfer the Project to the Government after the expiry of the
specified period of operation.

(iv) Build-Transfer-and-Operate (BTO).— A contractual arrangement whereby the
Government contracts out an infrastructure facility to the concessionaire to construct the
facility on a turn-key basis, assuming cost overruns, delays and specified performance
risks. Once the facility is commissioned satisfactorily, the concessionaire is given the
right to operate the facility and collect user levies specified in the Concession agreement.
The title of the facilities always vests with the Government in this arrangement.



24

(v) Design-Build-Finance-Operate-Transfer(DBFOT).—A contractual arrangement
whereby the concessionaire is bestowed with the responsibility of designing, building,
financing and operating the facility before transferring the Project to the Governnment
after the expiry of the specified period. The concessionaire operates the facility over a
fixed term during which they are allowed to charge the users appropriate tolls,  fees,
rentals and charges as incorporated in the contract to enable the recovery of investment
in the Project.

2.  Operations and Maintenance related Agreements

(i)  Management  Agreement.—  A contractual  arrangement  whereby  the  Government
entrusts  the  operation  and management  of  a  Project  to  the  concessionaire  for  the  period
specified in the agreement on payment of specified consideration. In such agreement, the
Government may charge  the user levies and collect the same either by itself or entrust the
collection for consideration to any concessionaire who shall after collecting the user levies,
pay the same to the Government.

(ii)  Lease  Management  Agreement.—  A  contractual  arrangement  whereby  the
Government leases a Project owned by it to the concessionaire which is permitted to operate
and  maintain  the  Project  for  the  period  specified  in  the  contract.  The  concessionaire  is
allowed to charge the users appropriate fees, rentals and charges as specified in the agreement
to enable the recovery of investment in the Project.

(iii)  Build-Lease-and-Transfer(BLT).—A  contractual  arrangement  whereby  the
concessionaire undertakes to finance and construct the Project and on its completion hands it
over to the Government. The Government then gives the facility to the same operator on a
lease arrangement for a fixed period, after which ownership of the facility is automatically
transferred to the Government.

(iv)  Rehabilitate-Operate-and-Transfer(ROT).—  A  contractual  arrangement
whereby an existing facility is handed over to the concessionaire to invest, refurbish,
operate and maintain for a period, at the expiry of which the facility is returned to the
Government. The concessionaire operates the facility over a fixed term during which
they are allowed to charge the users appropriate fees, rentals and charges as specified in
the contract to enable the recovery of investment in the Project.

(v)  Rehabilitate-Own-and-Operate (ROO).— A contractual arrangement whereby
an existing facility is handed over to the concessionaire to invest, refurbish, operate and
maintain the development facility from which the concessionaire is allowed to recover
the total investment by collecting user levies from facility users. The ownership of the
land shall be vested with the Government. The transfer of the facility to the Government
is  not  envisaged  in  this  arrangement;  however,  the  Government  may  terminate  its
obligations after a specified time period.]

____