Recorded RBI impact
Fine: Rs 2.00 L
Monetary penalty · Fresh imposition
Published by RBI
21 Jul 2025
Case Brief
By an order dated July 16, 2025, RBI imposed a monetary penalty of Rs 2 lakh on The Shahada Peoples Co-operative Bank Ltd., Shahada, Maharashtra. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, following a statutory inspection and a show-cause notice. RBI found that the bank had regularised certain NPAs without repayment through genuine sources, in breach of RBI directions applicable to urban co-operative banks on income recognition, asset classification, provisioning and related matters.
Why RBI Acted
RBI imposed a monetary penalty under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949 after a statutory inspection and show-cause process. The charge sustained was that the bank had regularised certain Non-Performing Accounts (NPAs) without repayment through genuine sources, amounting to non-compliance with RBI directions on 'Income Recognition, Asset Classification, Provisioning and Other Related Matters - UCBs'.
Operating Impact
The bank must absorb the monetary penalty and remain mindful of continued supervisory scrutiny. The order does not by itself restrict operations, but it signals that similar compliance lapses could invite further regulatory action.
Regulatory Basis
- Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 2.00 L
- Order Date
- 16 Jul 2025
- Effective From
- 16 Jul 2025
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank