(1) No company shall issue a prospectus or a letter of offer to the public for subscription of its debentures, unless the company has, before such issue, appointed one or more debenture trustees for such debentures and the company has, on the face of the prospectus or the letter of offer, stated that the debenture trustee or trustees have given their consent to the company to be so appointed. Provided that no person shall be appointed as a debenture trustee, if he - (a) beneficially holds shares in the company; (b) is beneficially entitled to moneys which are to be paid by the company to the debenture trustee; (c) has entered into any guarantee in respect of principal debts secured by the debentures or interest thereon. (2) Subject to the provisions of this Act, the functions of the debenture trustees shall generally be to protect the interest of holders of debentures (including the creation of securities within the stipulated time) and to redress the grievances of holders of debentures effectively.

Regulation 15 casts the following duties on the debenture trustees: (1) call for periodical reports from the body corporate; (2) take possession of trust property in accordance with the provisions of the trust deed; (3) enforce security in the interest of the debenture holders; (4) do such acts as necessary in the event the security becomes enforceable; (5) carry out such acts as are necessary for the protection of the debenture holders and to do all things necessary in order to resolve the grievances of the debenture holders; (6) ascertain and specify that: (a) in case where the allotment letter has been issued and debenture certificate is to be issued after registration of charge, the debenture certificates have been despatched by the body corporate to the debenture holders within 30 days of the registration of the charge with ROC; (b) debenture certificates have been despatched to the debenture holders in accordance with the provisions of the Companies Act; (c) interest warrants for interest due on the debentures have been despatched to the debenture holders on or before the due dates; (d) debentureholders have been paid the monies due to them on the date of redemption of the debentures; (7) ensure on a continuous basis that the property charged to the debenture is available and adequate at all time to discharge the interest and principal amounts payable in respect of the debentures and that such property is free from any other encumbrances save and except those which are specifically agreed to by the debenture trustee. (8) exercise due diligence to ensure compliance by the body corporate, with the provisions of the Companies Act, the listing agreement of the stock exchange or the trust deed; (9) to take appropriate measures for protecting the interest of the debenture holders as soon as any breach of the trust deed or law comes to his notice; Thanks