Case Brief
What Happened
The Reserve Bank of India imposed a monetary penalty of Rs 1 lakh on The Prathamik Shikshak Sahakari Bank Ltd., Kolhapur (Salary Earners' Bank) under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies). RBI said the bank violated operational instructions by declaring and paying dividend without prior permission. After issuing a show-cause notice and considering the bank's written reply, RBI found the violation substantiated and imposed the penalty.