Recorded RBI impact
License cancellation
License cancellation · Fresh imposition
Published by RBI
15 Dec 2003
Case Brief
On December 11, 2003, the Reserve Bank of India cancelled the Certificate of Registration issued to Namdhari Leasing Limited, New Delhi, under Section 45IA of the RBI Act, 1934. The cancellation prevents the company from transacting the business of a non-banking financial institution. RBI also prohibited the company from accepting deposits and from alienating its assets under Sections 45MB(1) and 45MB(2). The company must still repay public deposits according to the contract terms.
Why RBI Acted
The Reserve Bank of India cancelled the Certificate of Registration issued to Namdhari Leasing Limited under Section 45IA of the RBI Act, 1934. As a consequence, the company cannot carry on the business of a non-banking financial institution. RBI also prohibited it from accepting deposits and from alienating its assets under Section 45MB(1) and 45MB(2), respectively. The release notes that the company remains obligated to repay public deposits in accordance with the terms of the deposit contract.
Operating Impact
Namdhari Leasing Limited can no longer operate as an NBFC, cannot accept new deposits, and cannot alienate its assets. Existing public deposit obligations remain, so the company must continue repayment in line with contractual terms. This directly affects depositors and counterparties dealing with the company.
Regulatory Basis
- Section 45IA of the Reserve Bank of India Act, 1934
- Section 45MB (1) of the Reserve Bank of India Act, 1934
- Section 45MB (2) of the Reserve Bank of India Act, 1934
Action Facts
- Primary Impact
- License cancellation
- Order Date
- 11 Dec 2003
- Effective From
- 11 Dec 2003
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- NBFC