Recorded RBI impact
Fine: Rs 15.0 L
Monetary penalty · Fresh imposition
Published by RBI
23 Mar 2021
Case Brief
The Reserve Bank of India imposed a monetary penalty of ₹15 lakh on Sonata Finance Private Limited, Lucknow, Uttar Pradesh. RBI said statutory inspections for the company's financial positions as on March 31, 2018 and March 31, 2019 revealed non-compliance with RBI directions on 'Pricing of Credit' under the Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016. After a show-cause notice, reply, oral submissions, and additional submissions, RBI held the contravention substantiated and imposed the penalty under section 58G(1)(b) read with section 58B(5)(aa) of the RBI Act, 1934.
Why RBI Acted
RBI imposed a monetary penalty after statutory inspections with reference to the company's financial positions as on March 31, 2018 and March 31, 2019 revealed non-compliance with RBI's directions on 'Pricing of Credit' contained in the Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016. After issuing a show-cause notice, considering the company's reply and oral submissions, RBI concluded the charge was substantiated and warranted penalty under section 58G(1)(b) read with section 58B(5)(aa) of the RBI Act, 1934.
Operating Impact
Sonata Finance Private Limited must absorb the ₹15 lakh penalty; the release does not impose a new operational ban or restriction on business. The action signals supervisory non-compliance but does not invalidate customer transactions or agreements.
Regulatory Basis
- clause (b) of sub-section (1) of section 58 G
- clause (aa) of sub-section (5) of section 58B of the Reserve Bank of India Act, 1934
Action Facts
- Primary Impact
- Fine: Rs 15.0 L
- Order Date
- 23 Mar 2021
- Effective From
- 23 Mar 2021
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- NBFC