Recorded RBI impact
License cancellation
License cancellation · Fresh imposition
Published by RBI
16 Dec 2003
Case Brief
On November 21, 2003, the Reserve Bank of India cancelled the Certificate of Registration of A. M. Financial Services Limited, whose registered office was in Amritsar, under Section 45IA of the RBI Act, 1934. The cancellation was issued because the company was carrying on the business of a non-banking financial institution. As a result, the company cannot transact NBFC business, although it must continue to repay public deposits in accordance with the terms of the deposit contracts.
Why RBI Acted
The Reserve Bank of India cancelled the Certificate of Registration issued to A. M. Financial Services Limited on November 21, 2003. The cancellation was for carrying on the business of a non-banking financial institution, under Section 45IA of the RBI Act, 1934. After cancellation, the company cannot transact NBFC business, though it remains obliged to repay public deposits as per the deposit contract terms.
Operating Impact
A. M. Financial Services Limited is barred from conducting any non-banking financial institution business going forward. Public deposit obligations remain, so depositors are still entitled to repayment under the agreed contract terms.
Regulatory Basis
- Section 45IA of the Reserve Bank of India Act, 1934
- clause (a) of Section 45IA of the Reserve Bank of India Act, 1934
Action Facts
- Primary Impact
- License cancellation
- Order Date
- 21 Nov 2003
- Effective From
- 21 Nov 2003
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- NBFC