Recorded RBI impact
License cancellation
License cancellation · Fresh imposition
Published by RBI
24 May 2003
Case Brief
On May 19, 2003, the Reserve Bank of India cancelled the certificate of registration of Oswal Capital Services Limited, whose registered office is at Jugiana, Ludhiana, for carrying on the business of a non-banking financial institution. As a result, the company cannot transact NBFC business. RBI further prohibited the company from accepting deposits and from alienating its assets under the relevant provisions of the RBI Act, 1934, while noting that the company remains obligated to repay public deposits according to the terms of the deposit contract.
Why RBI Acted
The Reserve Bank of India cancelled the certificate of registration granted to Oswal Capital Services Limited under Section 45IA of the RBI Act, 1934, for carrying on the business of a non-banking financial institution. Consequent to cancellation, the company cannot transact NBFC business. RBI also stated that, under Section 45MB(1) and 45MB(2), the company is prohibited from accepting deposits and from alienating its assets, while remaining obligated to repay public deposits as per the deposit contract terms.
Operating Impact
Oswal Capital Services Limited must stop carrying on NBFC business and cannot accept deposits or transfer/alienate assets. Public deposit obligations continue, so deposit repayment remains due as per contract terms. The action directly affects the company and its depositors.
Regulatory Basis
- Section 45IA of the Reserve Bank of India Act, 1934
- Section 45MB (1) of this Act
- Section 45MB (2) of this Act
Action Facts
- Primary Impact
- License cancellation
- Order Date
- 19 May 2003
- Effective From
- 19 May 2003
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- NBFC