SectionsParticulars
Part IPreliminary
1Short title, extent and commencement
(1) This Act may be called the Banking Regulation Act, 1949. (2) It extends to the whole of India (3) It shall come into force on such date5 as the Central Go...
2Application of other laws not barreds
The provisions of this Act shall be in addition to, and not, save as hereinafter expressly provided, in derogation of the [Companies Act, 1956 (1 of 1956)], a...
3Act to apply to co-operative societies in certain cases
Nothing in this Act shall apply to- (a) a primary agricultural credit society; (b) a co-operative land mortgage bank; and (c) any other co-operative society, ex...
4Power to suspend operation of Act
(1) The Central Government, if on a representation made by the Reserve Bank in this behalf it is satisfied that it is expedient so to do, may by notification ...
5Interpretation
In this Act], unless there is anything repugnant in the subject or context,- (a) "approved securities" means- (i) securities in which a trustee may invest mon...
5AAct to override memorandum, articles, etc.
Save as otherwise expressly provided in this Act, (a) the provisions of this Act shall have effect notwithstanding anything to the contrary contained in the m...
Part IIBusiness Of Banking Companies
6Form and business in which banking companies may engage
 (1) In addition to the business of banking, a banking company may engage in any one or more of the following forms of business, namely,- (a) the borrowing, ...
7Use of words "bank"", ""banker"", ""banking"" or ""banking company"""
(1) No company other than a banking company shall use as part of its name 15[or, in connection with its business] any of the words "bank", "banker" or "bankin...
8Prohibition of trading
Notwithstanding anything contained in section 6 or in any contract, no banking company shall directly or indirectly deal in the buying or selling or bartering...
9Disposal of non-banking assets
Notwithstanding anything contained in section 6, no banking company shall hold any immovable property howsoever acquired, except such as is required for its...
10Prohibition of employment of Managing Agents and restrictions on certain forms of employment
(1) No banking company- (a) shall employ or be managed by a Managing Agent; or (b) shall employ or continue the employment of any person- (i) who is, or at an...
10ABoard of Directors to include persons with professional or other experience
(1) Notwithstanding anything contained in any other law for the time being in force, every banking company- (a) in existence on the commencement of section 3...
10BBanking company to be managed by whole-time Chairman
(1) Notwithstanding anything contained in any law for the time being in force or in any contract to the contrary, every banking company in existence on the co...
10BBPower of Reserve Bank to appoint Chairman of a banking company
(1) Where the office of the 35[Chairman of the Board of Directors appointed on a whole-times basis or the Managing Director] of a banking company is vacant, t...
10CChairman and certain Directors not to be required to hold qualification shares
A Chairman of the Board of Directors who is appointed on a whole-time basis or a Managing Director] of a banking company (by whomsoever appointed) and a direc...
10DProvisions of sections 10A and 10B to override all other laws, contracts, etc.
Any appointment or removal of a 35[Director, Chairman of the Board of Directors who is appointed on a whole-time basis or Managing Director] in pursuance of s...
11Requirement as to minimum paid-up capital and reserves
(1) Notwithstanding anything contained in [section 149 of the Companies Act, 1956], no banking company in existence on the commencement of this Act, shall, af...
12Regulation of paid-up capital, subscribed capital and authorized capital and voting rights of shareholders
(1) No banking company shall carry on business in India, unless it satisfies the following conditions, namely,- (i) that the subscribed capital of the compan...
12AElection of new Directors
(1) The Reserve Bank may, by order, require any banking company to call a general meeting of the shareholders of the company within such time, not less than t...
13Restriction on commission, brokerage, discount, etc., on sale of shares
Notwithstanding anything to the contrary contained in [sections 76 and 79 of the Companies Act, 1956 (1 of 1956)1, no banking company shall pay out directly o...
14Prohibition of charge on unpaid capital
No banking company shall create any charge upon any unpaid capital of the company, and any such charge shall be invalid....
14AProhibition of floating charge on assets
(1) Notwithstanding anything contained in section 6, no banking company shall create a floating charge on the undertaking or any property of the company or an...
15Restrictions as to payment of dividend
[(1)] No banking company shall pay any dividend on its shares until all its capitalized expenses (including preliminary expenses, organization expenses, share...
16Prohibition of common Directors
[(1) No banking company incorporated in India shall have as a Director in its Board of Directors any person who is a Director of any other banking company. (1...
17Reserve Fund
(1) Every banking company incorporated in India shall create a reserve fund and 50[* **] shall, out of the balance of profit of each year, as disclosed in the...
18Cash reserve
(1) Every banking company, not being a scheduled bank, shall maintain in India by way of cash reserve with itself or by way of balance in a current account wi...
19Restriction on nature of subsidiary companies
(1) A banking company shall not form any subsidiary company except a subsidiary company formed for one or more of the following purposes, namely.- (a) the und...
20Restrictions on loans and advances
(1) Notwithstanding anything to the contrary contained in section 77 of the Companies Act, 1956 (1 of 1956), no banking company shall- (a) grant any loans or ...
20ARestrictions on power to remit debts
(1) Notwithstanding anything to the contrary contained in section 293 of the Companies Act, 1956 (1 of 1956), a banking company shall not, except with the pri...
21Power of Reserve Bank to control advances by banking companies
(1) Where the Reserve Bank is satisfied that it is necessary or expedient in the public interest 86[or in the interests of depositors] 12[or banking policy] s...
21ARate of interest charged by banking companies not to be subject to scrutiny by courts
Notwithstanding anything contained in the Usurious Loans Act, 1918 (10 of 1918), or any other law relating to indebtedness in force in any State, a transactio...
22Licensing of banking companies
(1) Save as hereinafter provided, no company shall carry on banking business in India unless it holds a license issued in that behalf by the Reserve Bank and ...
23Restrictions on opening of new, and transfer of existing, places of business
(1) Without obtaining the prior permissions of the Reserve Bank- (a) no banking company shall open a new place of business in India or change otherwise than w...
24Maintenance of a percentage of assets
(1) After the expiry of two years from the commencement of this Act, every banking company shall maintain [in India] in cash, gold or unencumbered approved se...
25Assets in India
(1) The assets in India of every banking company at the close of business on the last Friday of every quarter or, if that Friday is a public holiday under the...
26Return of unclaimed deposits
Every banking company shall, within thirty days after the close of each calendar year, submit a return in the prescribed form and manner to the Reserve Bank a...
27Monthly returns and power to call for other returns and information
(1) Every banking company shall, before the close of the month succeeding that to which it relates, submit to the Reserve Bank a return in the prescribed form...
28Power to publish information
The Reserve Bank or the National Bank, or both, if they consider it in the public interest so to do, may publish any information obtained by them under this A...
29Accounts and balance-sheet
(1) At the expiration of each calendar years or at the expiration of a period of twelve months ending with such date as the Central Government may, by notific...
30Audit
[(1 ) The balance-sheet and profit and loss account prepared in accordance with section 29 shall be audited by a person duly qualified under any law for the t...
31Submission of returns
The accounts and balance-sheet referred to in section 29 together with the Auditor's report shall be published in the prescribed manner and three copies there...
32Copies of balance-sheets and accounts to be sent to Registrar
[(1) Where a banking company in any year furnished its accounts and balance-sheet in accordance with the provisions of section 31, it shall at the same time s...
33Display of audited balance-sheet by companies incorporated outside India
Every banking company, incorporated 119[outside India] shall, not later than the first Monday in August of any year in which it carries on business, display i...
34Accounting provisions of this Act not retrospective
Nothing in this Act shall apply to the preparation of accounts by a banking company and the audit and submission thereof in respect of any accounting year whi...
34AProduction of documents of confidential nature
(1) Notwithstanding anything contained in section l1of the Industrial Disputes Act, 1947 (14 of 1947), or any other law for the time being in force, no bankin...
35Inspection
(1) Notwithstanding anything to the contrary contained in [section 235 of the Companies Act, 1956 (1 of 1956),] the Reserve Bank at any time may, and on being...
35APower of the Reserve Bank to give directions
(1) Where the Reserve Bank is satisfied that- (a) in the 142[public interest]; or (aa) in the interest of banking policy; or] (b) to prevent the affairs of a...
35BAmendments of provisions relating to appointments of Managing Directors, etc., to be subject to previous approval of the Reserve Bank
(1) In the case of a banking company- (a) no amendment of any provision relating to 124[the maximum permissible number of Directors or] the appointment or re-...
36Further powers and functions of Reserve Bank
(1) The Reserve Bank may: (a) caution or prohibit banking companies generally or any banking company in particular against entering into any particular transa...
36ACertain provisions of the Act not to apply to certain banking companies
(1) The provisions of section 11, sub-section (1) of section 12, and sections 17, 18, 24 and 25 shall not apply to a banking company- (a) which, whether befo...
Part IIAControl Over Management
36AAPower of Reserve Bank to remove managerial and other persons from office
(1) Where the Reserve Bank is satisfied that in the public interest or for preventing the affairs of a banking company being conducted in a manner detrimental...
36ABPower of Reserve Bank to appoint additional Directors
(1) If the Reserve Bank is of  [opinion that in the interest of banking policy or in the public interest or] in the interests of the banking company or its de...
36ACPart IIA to override other laws
Any appointment or removal of a Director, Chief Executive Officer or other officer or employee in pursuance of section 36AA or section 36AB shall have effect ...
Part IIBProhibition Of Certain Activities In Relation To Banking Companies
36ADPunishments for certain activities in relation to banking companies
(1) No person shall: (a) obstruct any person from lawfully entering or leaving any office or place of business of a banking company or from carrying on any bu...
Part IICACquisition Of The Undertakings Of Banking Companies In Certain Cases
36AEPower of Central Government to acquire undertakings of banking companies in certain cases
(1) If, upon receipt of a report from the Reserve Bank, the Central Government is satisfied that a banking company: (a) has, on more than one occasion, failed...
36AFPower of the Central Government to make scheme
(1) The Central Government may, after consultation with the Reserve Bank, make a scheme for carrying out the purposes of this Part in relation to any acquired...
36AGCompensation to be given to shareholders of the acquired bank
(1) Every person who, immediately before the appointed day, is registered as a holder of shares in the acquired bank or, where the acquired bank is a banking ...
36AHConstitution of the Tribunal
(1) The Central Government may, for the purpose of this Part, constitute a Tribunal which shall consist of a Chairman and two other members. (2) The Chairman ...
36AITribunal to have powers of a civil court
(1) The Tribunal shall have the powers of a civil court, while trying a suit, under the Code of Civil Procedure, 1908 (5 of 1908), in respect of the following...
36AJProcedure of the Tribunal
(1) The Tribunal shall have power to regulate its own procedure. (2) The Tribunal may hold the whole or any part of its inquiry in camera. (3) Any clerical or...
Part IIISuspension Of Business And Winding Up Of Banking Companies
36BHigh Court defined
In this Part and in Part IIIA, "High Court", in relation to a banking company, means the High Court exercising jurisdiction in the place where the registered ...
37Suspension of business
(1) The High Court] may on the application of a banking company which is temporarily unable to meet its obligations make an order (a copy of which it shall ca...
38Winding up by High Court
(1) Notwithstanding anything contained in section 391, section 392, section 433 and section 583 of the Companies Act, 1956 (1 of 1956), but without prejudice ...
38ACourt liquidator
(1) There shall be attached to every High Court a court liquidator to be appointed by the Central Government for the purpose of conducting all proceedings for...
39Reserve Bank to be official liquidator
(1) Notwithstanding anything contained in section 38A of this Act or in section 448 or section 449 of the Companies Act, 1956 (1 of 1956), where in any procee...
39AApplication of Companies Act to liquidators
(1) All the provisions of the Companies Act, 1956 (1 of 1956), relating to a liquidator, in so far as they are not inconsistent with this Act, shall apply to ...
40Stay of proceedings
Notwithstanding anything to the contrary contained in 202[section 466 of the Companies Act, 1956 (1 of 1956)1, the 203[High Court] shall not make any order st...
41Preliminary report by official liquidator
Notwithstanding anything to the contrary contained in section 455 of the Companies Act, 1956 (1 of 1956), where a winding up order has been made in respect of...
41ANotice to preferential claimants and secured and unsecured creditors
(1) Within fifteen days from the date of the winding up order of a banking company or where the winding up order has been made before the commencement of the ...
42Power to dispense with meetings of creditors, etc.
Notwithstanding anything to the contrary contained in 205[section 460] of the Companies Act, 1956 (1 of 1956), the 203[High Court] may, in the proceedings for...
43Booked depositors' credits to be deemed proved
In any proceeding for the winding up of a banking company, every depositor of the banking company shall be deemed to have filed his claim for the amount shown...
43APreferential payments to depositors
(1) In every proceeding for the winding up of a banking company where a winding up order has been made, whether before or after the commencement of the Bankin...
44Power of High Court in voluntary winding up
(1) Notwithstanding anything to the contrary contained in section 484 of the Companies Act, 1956 (1 of 1956), no banking company may be voluntarily wound up u...
44AProcedure for amalgamation of banking companies
(1) Notwithstanding anything contained in any law for the time being in force, no banking company shall be amalgamated with another banking company, unless a ...
45Power of Reserve Bank to apply to Central Government for suspension of business by a banking company and to prepare scheme of reconstitution or amalgamation
(1) Notwithstanding anything contained in the foregoing provisions of this Part or in any other law or [any agreement or other instrument], for the time being...
Part IIIASpecial Provisions For Speedy Disposal Of Winding Up Proceedings
45APart IIIA to override other laws
The provisions of this Part and the rules made thereunder shall have effect notwithstanding anything inconsistent therewith contained in the 234[Companies Act...
45BPower of High Court to decide all claims in respect of banking companies
The High Court shall, save as otherwise expressly provided in section 45C, have exclusive jurisdiction to entertain and decide any claim made by or against a ...
45CTransfer of pending proceedings
(1) Where a winding up order is made or has been made in respect of a banking company, no suit or other legal proceeding, whether civil or criminal, in respec...
45DSettlement of list of debtors
(1) Notwithstanding anything to the contrary contained in any law for the time being in force, the High Court may settle in the manner hereinafter provided a ...
45ESpecial provisions to make calls on contributories
Notwithstanding that the list of the contributories has not been settled under 237[section 467 of the Companies Act, 1956 (1 of 1956)], the High Court may, if...
45FDocuments of banking company to be evidence
(1) Entries in the books of account or other documents of a banking company which is being wound up shall be admitted in evidence in all 239[legal proceedings...
45GPublic examination of Directors and Auditors
(1) Where an order has been made for the winding up of a banking company, the official liquidator shall submit a report whether in his opinion any loss has be...
45HSpecial provisions for assessing damages against delinquent Directors, etc.
(1) Where an application is made to the High Court under [section 543 of the Companies Act, 1956 (1 of 1956)] against any Promoter, Director, Manager, Liquida...
45IDuty of Directors and Officers of banking company to assist in the realization of property
Every Director or other officer of a banking company which is being wound up shall give such assistance to the official liquidator as he may reasonably requir...
45JSpecial provisions for punishing offences in relation to banking companies being wound up
(1) The High Court may, if it thinks fit, take cognizance of and try in a summary way any offence alleged to have been committed by any person who has taken p...
45KPower of High Court to enforce schemes of arrangements, etc.
[Repealed by the Banking Companies (Amendment) Act, 1959, s. 31, w.e.f. 1st. October, 19591 ...
45LPublic examination of Directors and Auditors, etc., in respect of a banking company under schemes of arrangement
(1) Where an application for sanctioning a compromise or arrangement in respect of a banking company is made under 225[section 391 of the Companies Act, 1956 ...
45MSpecial provisions for banking companies working under schemes of arrangement at the commencement of the Amendment Act
Where any compromise or arrangement sanctioned in respect of a banking company under Section 391 of the Companies Act, 1956 (1 of 1956)] is being worked at th...
45NAppeals
(1) An appeal shall lie from any order or decision of the High Court in a civil proceeding under this Act when the amount or value of the subject-matter of th...
45-OSpecial period of limitation
(1) Notwithstanding anything to the contrary contained in the 245[Indian Limitation Act, 1908 (9 of 1908)l or in any other law for the time being in force, in...
45PReserve Bank to tender advice in winding up proceedings
Where in any proceedings for the winding up of a banking company in which any person other than the Reserve Bank has been appointed as the official liquidator...
45QPower to inspect
(1) The Reserve Bank shall, on being directed so to do by the Central Government or by the High Court, cause an inspection to be made by one or more of its of...
45RPower to call for returns and information
The Reserve Bank may, at any time by a notice in writing, require the liquidator, of a banking company to furnish it, within such time as may be specified in ...
45SChief Presidency Magistrate and District Magistrate to assist official liquidator in taking charge of property of banking company being wound up
(1) For the purpose of enabling the official liquidator or the special officer appointed under sub-section (3) of section 37 to take into his custody or under...
45TEnforcement of orders and decisions of High Court
(1) All orders made in any civil proceeding by a High Court may be enforced in the same manner in which decrees of such court made in any suit pending therein...
45UPower of High Court to make rules
The High Court may make rules consistent with this Act and the rules made under section 52 prescribing:- (a) the manner in which inquiries and proceedings und...
45VReferences to Directors, etc., shall be construed as including references to past Directors, etc.
For the removal of doubts it is hereby declared that any reference in this Part to a Director, Manager, Liquidator, Officer or Auditor of a banking company sh...
45WPart II not to apply to banking companies being wound up
Nothing contained in Part II shall apply to a banking company which is being wound up....
45XValidation of certain proceedings
Notwithstanding anything contained in section 45B or any other provision of this Part or in section 11 of the Banking Companies (Amendment) Act, 1950 (20 of 1...
Part IIIBProvisions Relating To Certain Operations Of Banking Companies
45YPower of Central Government to make rules for the preservation of records
The Central Government may, after consultation with the Reserve Bank and by notification in the Official Gazette, make rules specifying the periods for which:...
45ZReturn of paid instruments to customers
(1) Where a banking company is required by its customer to return to him a paid instrument before the expiry of the period specified by rules made under secti...
45ZANomination for payment of depositors' money
(1) Where a deposit is held by a banking company to the credit of one or more persons, the depositor or, as the case may be, all the depositors together, may ...
45ZBNotice of claims of other persons regarding deposits not receivable
No notice of the claim of any person, other than the person or persons in whose name a deposit is held by a banking company, shall be receivable by the bankin...
45ZCNomination for return of articles kept in safe custody with banking company
(1) Where any person leaves any article in safe custody with a banking company, such person may nominate, in the prescribed manner, one person to whom, in the...
45ZDNotice of claims of other persons regarding articles not receivable
No notice of the claim of any person, other than the person or persons in whose name any article is held by banking company in safe custody, shall be receivab...
45ZERelease of contents of safety lockers
(1) Where an individual is the sole hirer of a locker from a banking company, whether such locker is located in the safe deposit vault of such banking company...
45ZFNotice of claims of other persons regarding safety lockers not receivable
No notice of the claim of any person, other than hirer or hirers of a locker, shall be receivable by a banking company nor shall the banking company be bound ...
Part IVMiscellaneous
46Penalties
(1) Whoever in any return, balance-sheet or other document 202[or on any information required or furnished] by or under or for the purpose of any provision of...
46AChairman, Director, etc., to be public servants for the purposes of Chapter IX to the Indian Penal Code
Every Chairman who is appointed on a whole-time basis, Managing Director, Director, Auditor, Liquidator, Manager and any other employee of a banking company s...
47Cognizance of offences
No court shall take cognizance of any offence punishable under 216[sub-section (5) of section 36AA or] section 46 except upon complaint in writing made by an ...
47APower to Reserve Bank to impose penalty
(1) Notwithstanding anything contained in section 46, if a contravention or default of the nature referred to in sub-section (3) or sub-section (4) of section...
48Application of fines
A court imposing any fine under this Act may direct that the whole or any part thereof shall be applied in or towards payment of the costs of the proceedings,...
49Special provisions for private banking companies
The exemptions whether express or implied, in favor of a private company in 260[sections 90, 165, 182, 204 and 255, clauses (a) and (b) of sub-section (1) of ...
49ARestriction on acceptance of deposits withdrawable by cheque
No person other than a banking company, the Reserve Bank, the State Bank of India or any other 261[banking institution, firm or other person notified by the C...
49BChange of name by banking company
Notwithstanding anything contained in section 21 of the Companies Act, 1956 (1 of 1956), the Central Government shall not signify its approval to the change o...
49CAlteration of memorandum of a banking company
Notwithstanding anything contained in the Companies Act, 1956 (1 of 1956), no application for the confirmation of the alteration of the memorandum of a bank...
50Certain claims for compensation barred
No person shall have any right, whether in contract or otherwise, to any compensation for any loss incurred by reason of the operation of any of the provision...
51Application of certain provisions to the State Bank of India and other notified banks
(1) Without prejudice to the provisions of the State Bank of India Act, 1955 (23 of 1955), or any other enactment, the provisions of section 10, 13 to 15, 17 ...
52Power of Central Government to make rules
(1) The Central Government may, after consultation with the Reserve Bank, make rules to provide for all matters for which provision is necessary or expedient ...
53Power to exempt in certain cases
The Central Government may, on the recommendation of the Reserve Bank, by notification in the Official Gazette, that any or all of the provisions of this Act ...
54Protection of action taken under Act
(1) No suit or other legal proceedings shall lie against the Central Government, the Reserve Bank or any officer for anything which is in good faith done or i...
55Amendment of Act 2 of 1934
The Reserve Bank of India Act, 1934 shall be amended in the manner specified in the fourth column of the First Schedule, and the amendments to section 18 ther...
55APower to remove difficulties
If any difficulty arises in giving effect to the provisions of this Act, the Central Government may, by order as occasion requires, do anything (not inconsist...
Part VApplication Of The Act To Co-Operative Banks
56Act to apply to Co-operative Societies subject to modifications
The provisions of this Act, as in force for the time being, shall apply to, or in relation to, co-operative societies as they apply to, or in relation to, ban...
Schedule IIIForm A :- Form Of Balance-Sheet
Capital and LiabilitiesProperty and assets Rs. P. Rs. P. Rs. P. Rs. P. 1. Capital (i) Authorized Capital ..........shares of Rs. .............each (ii) Subscri...
Form B :- Form Of Profit And Loss Account
Profit and loss account for the year ended Expenditure Income  Rs. P.  Rs. P.  Rs. P.  Rs. P. 1. Interest on deposits, borrowings, etc 1. Interest and discount ...
Schedule IAmendments
(Section 55) Year No. Short title Amendments 1 2 3 4 1934 2. The Reserve Bank of India Act, 1934  (1) In section 17, to clause (15A), the following shall be ad...
Schedule II[Repealed by the Repealing and the Amending Act, 1957 (36 of 1957) s. 2 and Sch. I.]
Schedule IIIForm A :- Form of Balance Sheet
Balance sheet of ...........(enter name of banking company) Balance sheet as on 31st March ..........(Year) (000's omitted) Capital and liabilities schedule A...
Form B :- Profit and loss account for the year ended on 31st March (year)
Schedule No. ............................... Year ended on 31-3-19....... (current year) year ended on 31-3-19....... (previous yea) I. Income Interest earned ...
Schedule IVList Of Debtors
(Section 45D(2)) 1. The official liquidator shall from time to time submit lists of debtors to the High Court, each list being verified by an affidavit. 2. E...
Schedule VPrinciples Of Compensation
(Section 36AG) 1. The compensation to be given under section 36AG shall be an amount equal to the value of the assets of the acquired bank as on the day imme...
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