Bare Acts

The Banking Regulation Act, 1949

An Act to consolidate and amend the law relating to banking.

बैंककारी विनियमन अधिनियम, 1949

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Act Details

Act Number:

Act Year:

1949

Location:

Enactment Date:

3/10/1949

Enforcement Date:

16-03-1949

Ministry:

Ministry of Finance

Department:

Department of Financial Services

All Section List (Banking Regulation Act)

PRELIMINARY

Section 1 to Section 5A

Section 1

Short title, extent and commencement.

Section 2

Application of other laws not barred.

Section 3

Act not to apply to certain co-operative societies.

Section 4

Power to suspend operation of Act.

Section 5

Interpretation.

Section 5A

Act to override memorandum, articles, etc.

BUSINESS OF BANKING COMPANIES

Section 6 to Section 36A

Section 6

Form of business in which banking companies may engage.

Section 7

Use of words "bank", "banker", "banking" or "banking company".

Section 8

Prohibition of trading.

Section 9

Disposal of non-banking assets.

Section 10

Prohibition of employment of managing agents and restrictions on certain forms of employment.

Section 10A

Board of directors to include persons with professional or other experience.

Section 10B

Banking company to be managed by whole time chairman.

Section 10BB

Power of Reserve Bank to appoint chairman of the Board of directors appointed on a whole-time basis or a managing director of a banking company.

Section 10C

Chairman and certain directors not to be required to hold qualification shares.

Section 10D

Provisions of sections 10A and 10B to override all other laws, contracts, etc.

Section 11

Requirement as to minimum paid-up capital and reserves.

Section 12

Regulation of paid-up capital, subscribed capital and authorised capital and voting rights of shareholders.

Section 12A

Election of new directors.

Section 12B

Regulation of acquisition of shares or voting rights.

Section 13

Restriction on commission, brokerage, discount, etc., on sale of shares.

Section 14

Prohibition of charge on unpaid capital.

Section 14A

Prohibition of floating charge on assets.

Section 15

Restrictions as to payment of dividend.

Section 16

Prohibition of common directors.

Section 17

Reserve Fund.

Section 18

Cash reserve.

Section 19

Restriction on nature of subsidiary companies.

Section 20

Restrictions on loans and advances.

Section 20A

Restrictions on power to remit debts.

Section 21

Power of Reserve Bank to control advances by banking companies.

Section 21A

Rates of interest charged by banking companies not to be subject to scrutiny by courts.

Section 22

Licensing of banking companies.

Section 23

Restrictions on opening of new, and transfer of existing, places of business.

Section 24

Maintenance of a percentage of assets.

Section 25

Assets in India.

Section 26

Return of unclaimed deposits.

Section 26A

Establishment of Depositor Education and Awareness Fund.

Section 27

Monthly returns and power to call for other returns and information.

Section 28

Power to publish information.

Section 29

Accounts and balance-sheet.

Section 29A

Power in respect of associate enterprises.

Section 30

Audit.

Section 31

Submission of returns.

Section 32

Copies of balance-sheets and accounts to be sent to registrar.

Section 33

Display of audited balance-sheet by companies incorporated outside India.

Section 34

Accounting provision of this Act not retrospective.

Section 34A

Production of documents of confidential nature.

Section 35

Inspection.

Section 35A

Power of the Reserve Bank to give directions.

Section 35AA

Power of the Central Government to authorize Reserve Bank for issuing directions to banking companies to initiate insolvency resolution process.

Section 35AB

Power of Reserve Bank to issue directions in respect of stressed assets.

Section 35B

Amendments of provisions relating to appointments of managing directors, etc., to be subject to previous approval of the Reserve Bank.

Section 36

Further powers and functions of Reserve Bank.

Section 36A

Certain provisions of the Act not to apply to certain banking companies.

CONTROL OVER MANAGEMENT

Section 36AA to Section 36AC

Section 36AA

Power of Reserve Bank to remove managerial and other persons from office.

Section 36AB

Power of Reserve Bank to appoint additional directors.

Section 36AC

Part IIA to override other laws.

SUPERSESSION OF BOARD OF DIRECTORS OF BANKING COMPANY

Section 36ACA

Supersession of Board of Directors in certain cases.

PROHIBITION OF CERTAIN ACTIVITIES IN RELATION TO BANKING COMPANIES

Section 36AD

Punishments for certain activities in relation to banking companies.

ACQUISITION OF THE UNDERTAKINGS OF BANKING COMPANIES IN CERTAIN CASES

Section 36AE to Section 36AJ

Section 36AE

Power of Central Government to acquire undertakings of banking companies in certain cases.

Section 36AF

Power of the Central Government to make scheme.

Section 36AG

Compensation to be given to shareholders of the acquired bank.

Section 36AH

Constitution of the Tribunal.

Section 36AI

Tribunal to have powers of a civil court.

Section 36AJ

Procedure of the Tribunal.

SUSPENSION OF BUSINESS AND WINDING UP OF BANKING COMPANIES

Section 36B to Section 45

Section 36B

High Court defined.

Section 37

Suspension of business.

Section 38

Winding up by High Court.

Section 38A

Court liquidator.

Section 39

Reserve Bank to be official liquidator.

Section 39A

Application of Companies Act to liquidators.

Section 40

Stay of proceedings.

Section 41

Preliminary report by official liquidator.

Section 41A

Notice to preferential claimants and secured and unsecured creditors.

Section 42

Power to dispense with meetings of creditors, etc.

Section 43

Booked depositors' credits to be deemed proved.

Section 43A

Preferential payments to depositors.

Section 44

Powers of High Court in voluntary winding up.

Section 44A

Procedure for amalgamation of banking companies.

Section 44B

Restriction on compromise or arrangement between banking company and creditors.

Section 45

Power of Reserve Bank to apply to Central Government for suspension of business by a banking company and to prepare scheme of reconstitution or amalgamation.

SPECIAL PROVISIONS FOR SPEEDY DISPOSAL OF WINDING UP PROCEEDINGS

Section 45A to Section 45X

Section 45A

Part IIIA to override other laws.

Section 45B

Power of High Court to decide all claims in respect of banking companies.

Section 45C

Transfer of pending proceedings.

Section 45D

Settlement of list of debtors.

Section 45E

Special provisions to make calls on contributories.

Section 45F

Documents of banking company to be evidence.

Section 45G

Public examination of directors and auditors.

Section 45H

Special provisions for assessing damages against delinquent directors, etc

Section 45I

Duty of directors and officers of banking company to assist in the realisation of property.

Section 45J

Special provisions for punishing offences in relation to banking companies being wound up.

Section 45K

Omitted.

Section 45L

Public examination of directors and auditors, etc., in respect of a banking company under schemes of arrangement

Section 45M

Special provisions for banking companies working under schemes of arrangement at the commencement of the Amendment Act.

Section 45N

Appeals.

Section 45O

Special period of limitation

Section 45P

Reserve Bank to tender advice in winding up proceedings

Section 45Q

Power to Inspect

Section 45R

Power to call for returns and information

Section 45S

Chief Presidency Magistrate and District Magistrate to assist official liquidator in taking charge of property of banking company being wound up.

Section 45T

Enforcement of orders and decisions of High Court.

Section 45U

Power of High Court to make rules.

Section 45V

References to directors, etc., shall be construed as including references to past directors, etc.

Section 45W

Part II not to apply to banking companies being wound up

Section 45X

Validation of certain proceedings.

PROVISIONS RELATING TO CERTAIN OPERATIONS OF BANKING COMPANIES

Section 45Y to Section 45ZF

Section 45Y

Power of Central Government to make rules for the preservation of records.

Section 45Z

Return of paid instruments to customers.

Section 45ZA

Nomination for payment of depositors' money.

Section 45ZB

Notice of claims of other persons regarding deposits not receivable.

Section 45ZC

Nomination for return of articles kept in safe custody with banking company.

Section 45ZD

Notice of claims of other persons regarding articles not receivable.

Section 45ZE

Release of contents of safety lockers.

Section 45ZF

Notice of claims of other persons regarding safety lockers not receivable.

MISCELLANEOUS

Section 46 to Section 55A

Section 46

Penalties

Section 46A

Chairman, director, etc., to be public servants for the purposes of Chapter IX of the Indian Penal Code.

Section 47

Cognizance of offences.

Section 47A

Power of Reserve Bank to impose penalty

Section 48

Application of fines.

Section 49

Special provisions for private banking companies.

Section 49A

Restriction on acceptance of deposits withdrawable by cheque.

Section 49B

Change of name by a banking company.

Section 49C

Alteration of memorandum of a banking company.

Section 50

Certain claims for compensation barred

Section 51

Application of certain provisions to the State Bank of India and other notified banks.

Section 52

Power of Central Government to make rules.

Section 53

Power to exempt in certain cases.

Section 54

Protection of action taken under Act.

Section 55

Amendment of Act 2 of 1934.

Section 55A

Power to remove difficulties

APPLICATION OF THE ACT TO CO-OPERATIVE BANKS

Section 56

Act to apply to co-operative societies subject to modifications.