Bhuj Mercantile Co-operative Bank Ltd., Ahmedabad

RBI extended its existing Section 35A directions on Bhuj Mercantile Co-operative Bank Ltd., Ahmedabad. The bank continued to face restrictions on lending, deposits, payments, and asset disposal, with depositor withdrawals capped.

The bank had to continue operating under RBI-imposed restrictions until April 2, 2014, with core business activities curtailed and depositor withdrawals capped. Depositors could withdraw only within the specified limit, and borrowers/sureties could see withdrawals adjusted against their liabilities to the bank.

• Section 35A of the Banking Regulation Act, 1949
• Section 56 of the Banking Regulation Act, 1949

RBI has extended the directions on The Bhuj Mercantile Co-operative Bank Ltd., Ahmedabad for another six months. The bank will remain under these directions until October 02, 2013.

The bank remains subject to RBI directions for the extension period and must continue complying with the modified regulatory conditions. The restriction affects the bank’s operations and persists until October 02, 2013, subject to review.

• Sub-Section (1) of Section 35A of Banking Regulation Act, 1949 (As Applicable to Co-operative Societies)

RBI issued Section 35A directions against Bhuj Mercantile Co-operative Bank, restricting lending, investments, liabilities, payments, and asset disposals. Depositor withdrawals were also capped, later raised to Rs 30,000 per depositor.

The bank’s day-to-day operations were constrained: it could not freely lend, invest, raise liabilities, accept fresh deposits, or dispose of assets without RBI approval. Depositors could withdraw only within the prescribed cap, and the higher withdrawal limit introduced on May 18, 2012 applied subject to any borrower/surety liabilities being adjusted first. The restrictions were time-bound for six months from April 02, 2012, subject to review.

• Section 35A of the Banking Regulation Act, 1949
• Section 56 of the Banking Regulation Act, 1949

RBI placed Bhuj Mercantile Co-operative Bank under Section 35A restrictions. The bank faced caps on withdrawals and could not undertake several lending, investment, liability, or asset-disposal activities without prior RBI approval.

The bank remained operational but under tight RBI-imposed constraints. Depositors faced a withdrawal cap of ₹10,000 per account, while the bank could not freely lend, invest, raise liabilities, accept fresh deposits, or dispose of assets without RBI approval until the directions expired or were reviewed.

• Section 35A of the Banking Regulation Act, 1949 (AACS)
• Section 56 of the Banking Regulation Act, 1949