ALPINE FINLEASE LIMITED Vs. RESERVE BANK OF INDIA

JUDGEMENT

(1.) Present writ petition has been filed challenging the order dtd. 13/4/2020 passed by the Appellate Authority whereby the appeal of the Petitioner filed against the cancellation of registration order dtd. 2/8/2018 passed by the Reserve Bank of India (Respondent No. 1) was dismissed. Petitioner also challenges the notification dtd. 27/3/2015, gazetted on 11/3/2016 issued by the Respondent No. 1.

(2.) Learned senior counsel for the petitioner states that the petitioner has been operating as a Non-Banking Financial Company ("NBFC") since 12/1/1999. He states that vide the impugned notification dtd. 27/3/2015 the Respondent No.1 in exercise of its power under Sec. 45-IA(1)(b) of the Reserve Bank of India Act, 1934 ("the Act") specified two hundred lakh rupees as the net owned fund ("NOF") required for an NBFC to commence or carry on the business of a non-banking financial institution. The notification further provided that an NBFC holding a Certificate of Registration and having the NOF less than two hundred lakh rupees, may continue to carry on the business of non-banking financial institution, if such company achieves NOF of one hundred lakh rupees before 1/4/2016 and two hundred lakh rupees before 1/4/2017.

(3.) Learned senior counsel for the petitioner states that the Petitioner had achieved the required NOF of two hundred lakh rupees by 30/3/2017 as has been duly certified by its chartered accountant. He, however, states that more than one year after the due date of compliance, the Respondent No.1 issued a Show Cause Notice dtd. 2/5/2018 to the Petitioner asking it to reply as to why its Certificate of Registration should not be cancelled on account of failure to achieve the required NOF by 1/4/2017.