Apart from the balance sheet audit, reserve bank of india is empowered by the provisions of the banking regulation act, 1949 to conductorder a special audit of the accounts of any banking company. Establishment of depositor education and awareness fund. The central banking enquiry committee recommended the need of a separate legislation to control banks due to mushroom growth of banks with inadequate capital, dishonest management, speculative business etc etc. Section 23 of banking regulation act, 1949 third party transfer of. The banking regulation act, 1949 came into force on march 16, 1949. This act was subjected to several amendment and amending act of 1 95 6 that came into force in 1 966 was known as the banking regulation act. Reserve bank of india logo reserve bank of india database.
Whereas the reserve bank of india is satisfied that in order to protect the interest of the depositors and in public interest, it is necessary to issue certain directions to yes bank ltd. From 1 st march, 1966, it was renamed as banking regulation act, 1949. The reserve bank of india rbi is indias central bank, which controls the issue and supply of the indian rupee. The banking regulation act 1949 has 56 sections in total. The amendments to the br act 1949, introduced through the ordinance, and the notification issued thereafter by the central government empower rbi to issue directions to any banking company or banking companies to initiate insolvency resolution process in respect of a default, under the provisions of the insolvency and bankruptcy code, 2016 ibc. Here we have listed the acts related to banking sector. The banking regulation act, 1949 reserve bank of india. Passed as the banking companies act 1949, it came into force from 16 march 1949 and changed to banking regulation act 1949 from 1 march 1966. Reserve bank of india act 1934 we have studied in banking structure of india that rbi was formed under rbi act 1934 it was amended in 1936, this act gives the framework of banking structure in india and also states the definition of scheduled. Shivajirao patil nilangekar urban cooperative limited, nilanga, dist. Accordingly, the reserve bank of india in exercise of the powers vested in it under subsection 1 of section 35a of the banking regulation act, 1949 as applicable to cooperative societies read with section 56 of the banking regulation act, 1949 hereby directs that the brahmawart commercial cooperative bank ltd. Rbi plays an important part in the development strategy of the government of india rbi regulates commercial banks and non banking finance companies working in india. What is the role of the rbi under the banking regulation.
A bank is a financial institution which accepts the deposit of money from the public for lending or, investment. The banking regulation amendment bill, 2020 prsindia. Act to apply to cooperative societies in certain cases 4. Section 10bb provides power to reserve bank to appoint chairman of the board of directors appointed on a whole time basis or managing director of any banking company. May 19, 2020 rbi imposes rs 50 lakh fine on pnb for delay in reporting fraud in kingfisher airlines account 03 aug, 2019, 04.
Bank of india rbi in bank mergers and elaborate on the guidelines. The reserve bank of india amendment act, 1951 32 of 1951. Banking regulation act, 1949 also provide powers of reserve bank of india such as. The reserve bank of india third amendment act, 1940 38 of 1940. Powers, history, functions of the reserve bank of india rbi. What are the main provisions of banking regulation act, 1949. For other entities, it derives power from the rbi act 1934.
The industrial finance corporation of india act 1948. The key statutes and regulations that govern the banking industry in india are. There was initially 55 sections but in 1965 the banking regulation act 1949 was amended to include cooperative banks in the 56th section. The act was amended by the amending act of 1958 to extend social control over the banks and this expression social control was used to nationalize the 14 banks by the act of 1969. Banks play a very important role in the development of any economy by moralizing financial resources from the place. One, in addition to the default site, the refurbished site also has all the information bifurcated functionwise. Jaiib aims at providing the required level of basic knowledge in banking and financial services, banking technology, customer relations, basic accountancy, and legal aspects necessary for. Banking regulation act 1949 section 35a citation 38699. Negotiable instrument act 1881 the bankersbooks evidence act 1891 the reservebank of india act 1934 the industrial finance corporation of india act 1948 the banking companies legal practitioner clients accounts act 1949 the industrial disputes banking and insurance companies act 1949. Reserve bank of india, in the public interest, ha issuedd directions to dr. The act gives following powers to reserve bank of india rbi. Banking regulation act 1949 important sections in hindi. Banking regulation act, 1949 part 2 jaiib paper 3 bank.
Mar 24, 2016 section 23 of banking regulation act, 1949 aacs extending valueadded services through atms please refer to our circular dcbr. As you are aware, the government of india, ministry of finance, notified the banking law amendments act, 2012, vide gazette notification dated january 17, 20, published in part ii section 3subsection ii of the gazette of india no. Provisions of rbi act 1935, banking regulation act 1949, prevention of money laundering act, 2002. Quiz in which was banking regulation act passed in parliament. Section 23 of banking regulation act, 1949 aacs extending. In 1965, it was amended and made applicable to cooperative banks also. April 14, 2015 dear all welcome to the refurbished site of the reserve bank of india. Subsituted by act 7 of 1961, section 2, for national interest. Rbi in the compendium of best practices in a computerised environment and guidelines.
Till 1949, there was no separate act for banking in india. Banking regulation act 1949 loans securities finance. Banking regulation act 1949 copy free download as powerpoint presentation. The banking companies legal practitioner clients accounts act 1949. Act, 1949 aacs, in terms of which banks may also engage in managing, selling and realizing any property which may come into its possession in satisfaction, or part satisfaction, of any of its claims. Reserve bank of india reserve bank of india was established in 1935, after the enactment of the reserve bank of india act 1934 rbi act. As announced in the sixth bimonthly monetary policy statement 201415 by reserve bank of india on february 03, 2015, it has been decided to reduce the statutory liquidity ratio slr of scheduled commercial banks, local area banks and regional rural banks from 22. Extracts of provisions contained in various acts regulation schemenotifications applicable for election of shareholders directors the banking regulation act, 1949 section 5 ne. The special audit may be conducted or ordered to be conducted, in the opinion of the reserve bank of india that the special audit is necessary. Section 24 of the banking regulation act, 1949 maintenance. Study material for bank promotion banking regulation act. Taxmanns banking regulation act 1949 incorporated banking ombudsman scheme, cooperative banks rules, period of preservation of records, acquisition and transfer of undertakings act and banking regulation rules. Discuss the salient features of the indian banking.
The bill seeks to amend the banking regulation act, 1949, with regard to. Section 19 of the banking regulation act, 1949 equity. Banking regulation act 1949 16 th march 1949 ramees k abdul aziz roll no. The rbi act was enacted to establish and set out the. The industrial disputes banking and insurance companies act 1949. Section 19 of the banking regulation act, 1949 equity investments in. State bank of india act, 1955 and the banking regulation act, 1949. Definition of bank and banking regulation act 1949 sarkari.
Rbi imposes rs 50 lakh fine on pnb for delay in reporting fraud in kingfisher airlines account 03 aug, 2019, 04. The reserve bank of india amendment and miscellaneous provisions. Whereas it is expedient to consolidate and amend the law relating to banking 2. L atur, maharashtra in exercise of powers vested in it under subsection 1 of section 35a of the banking regulation act, 1949 aacs read with section 56 of the banking regulation act. Banking regulation act 1949 and important sections pdf. An act further to amend the banking regulation act, 1949.
Deshmukh raghuram rajan urjit patel quiz 1st governor of rbi. Banking regulation act, 1949 bare acts law library advocatekhoj. It contained various aspects related to banking in india. The banking regulation act, 1949 is a legislation in india that regulates all banking firms in india. Thus, nationalization of rbi took place in 1949 and from january 1, 1949, rbi started working as a government owned bank. Section 24 and section 56 of the banking regulation act, 1949. This act gives power to the rbi to exercise control and regulate banks. Short title, extent and commencement 1 this act may be called the banking 2 regulation act, 1949. An act to consolidate and amend the law relating to banking 1.
Further powers and functions of reserve bank 1 the reserve bank may. Banking regulation act 1949 and important sections pdf download. All scheduled commercial banks excluding rrbs dear sir, section 19 of the banking regulation act, 1949equity investments in subsidiaries and other companies draft guidelines. Business of banking companies this act may be called the banking regulation act, 1949. The requirements regarding the minimum paidup capital and reserves for commence mint of banking business. Passed as the banking companies act 1949, it came into force wef 16 march 1949 and changed to banking regulations act 1949 wef 01. Substantial interest i in relation to a company, means the holding of a beneficial interest by an individual or his. Rbidirections under section 35a of the banking regulation. The act was initially enacted to regulate the banking companies. The provisions of this act shall be in addition to, and not, save as hereunder expressly.
Dear sir, section 23 of the banking regulation act, 1949 relaxations in branch licensing policy. Directions under section 35a of the banking regulation act. As announced in the second bimonthly monetary policy statement 201718 of the reserve bank of india today, it has been decided to reduce the statutory liquidity ratio. It under went some change to become the banking regulations act 1949 wef 01. Full text containing the act, banking regulation act, 1949, with all the sections, schedules, short title, enactment date, and footnotes. Section 21 power of reserve bank to control advances by banking companies. Notifications 70 kb section 24 and section 56 of the banking regulation act, 1949 maintenance of statutory liquidity ratio slr rbi 201617318. The reserve bank of india amendment ordinance, 1941 ord.
In terms of these provisions, banks cannot, without the prior approval of the reserve bank of india rbi, open a new place of business in india or outside india or change, otherwise than within the same city, town or village, the location of the existing place of business. Banking regulation act, 1949 bare acts law library. Rbi circular on section 6 of the banking regulation act, 1949. The act extends to entire nation including jammu and kashmir. Aug 31, 2009 a reference is invited to section 6 1f of the banking regulation act b. Section 24 and section 56 of the banking regulation act, 1949 maintenance of. In these regulations, unless there is anything repugnant in the subject or context, definitions a the act means the reserve bank of india act 1934 ii of 1934.
Directive under section 35a of the banking regulation act. Government and rbis powers opening of new banks and branch licensing constitution of board of directors and their rights banks share holders and their rights crr and slr concepts cash. After independence, the government passed reserve bank transfer to public ownership act, 1948 and took over rbi from private shareholders after paying appropriate compensation. This penalty of rs 50 lakh was imposed by the rbi on the bank under various sections of the banking regulation act, 1949.
An act to consolidate and amend the law relating to banking. Here you can find description about banking regulation act, 1949 in hindi. The international monetary fund and bank ordinance, 1945 ord. The banking regulation act empowers rbi to regulate the operations of banks.
Principal provisions of banking regulation act, 1949. There are many provisions of banking regulation act 1949 and we are going to the topic about business of banking companies. The reserve bank of india amendment act, 1949 44 of 1949. Initially, the law was applicable only to banking companies. Banking regulation act 1949 copy reserve bank of india. Buy banking regulation act 1949 book online at best prices in india on. Banking company bound to comply with any direction issued by r. Companies act 1956 defining company, negotiable instrument act defining public holiday. Annex ii the banking regulation act, 1949 form viii rule. Buy banking regulation act 1949 book online at low. The reserve bank of india amendment act, 1947 11 of 1947. Rbi is the regulator of the entire banking in india. An act to consolidate and amend the law relating to banking 2. Save judgments add notes store search result sets organizer client files start your free trial today.
For commencing banking business, a primary urban cooperative bank, as in the case of commercial bank, is required to obtain a licence from the reserve bank of india, under the provisions of section 22 of the banking regulation act, 1949 as applicable to cooperative societies. March 1948 february 1949 march1934 when did banking regulation act came into force. Apr 28, 2011 rbi derives its regulating powers for indian banking system from the provisions of the banking regulation act 1949. Section 24 of the banking regulation act, 1949 maintenance of. Short title, extent and commencement1 this act may be called the banking 2regulation act, 1949. The banking regulation act 1949 is a legislation in india, that states all. Introduction banking means the accepting, for the purpose of lending or investment, of deposits of money from the public, repayable on demand or otherwise, and withdrawable by cheque, draft, order or otherwise. Banking regulation act, 1949 reserve bank of india. Section 24 and section 56 of the banking regulation act, 1949 maintenance of statutory. The objectives of this function are to protect the interest of the depositors and maintain the safety and soundness of the banking and financial system of the country.
The reserve bank of india amendment act, 1946 23 of 1946. Banking regulation act 1949 the reserve bank of india act 1934 3. The banking and regulations act was enacted to safeguard the interest of the depositors and to control the abuse of powers by controlling the banks by any means necessary and to the interest of indian economy in general. From april 1, 2017, entire slr as prescribed by rbi as on that date in assets as mentioned in a to c above.
Banking regulation act, 1949 banking company bankexamstoday. Oct, 2016 b gold as defined in section 5g of banking regulation act, 1949 aacs valued at a price not exceeding the current market price. Banking regulation act 1949 schedule iii citation 38791. The banking ombudsman scheme is introduced under section 35 a of the banking regulation act, 1949 by rbi with effect from 1995. Banking regulation act, 1949 was enacted on 10 march 1949 and came to effect on 16 march 1949. The banking ombudsman scheme is an expeditious and inexpensive forum for bank customers for resolution of complaints relating to certain services rendered by banks. What is the difference between the rbi act and the banking. Jan 17, 2017 study material for bank promotion banking regulation act published by jai on january 17, 2017 january 17, 2017 in this series of study material for bank promotion, these are brief notes on banking regulation act. Banking regulation act, 1949 br act gave wide powers to rbi as regards to establishment of new banksmergers and amalgamation of banks, opening of new branches, etc br act, 1949 gave rbi. The following are the important provisions under banking regulation act, 1949 regarding control and regulation of banking sector in india. Oct 10, 2012 the banking regulation act 1949 extends to whole of india.
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