EXCEL BUSINESS LINKS P LTD Vs. UOI

JUDGEMENT

(1.) Rule. Mr. Ramesh Babu, Mr. Srinjoy Banerjee and Mr. Rajiv Mehra waive notice of rule. With consent of parties, the matter was heard finally.

(2.) The petitioner seeks a direction for quashing of decisions of the Reserve Bank of India (RBI) dated 4th September, 2000 and an order of the Appellate Authority constituted under the Reserve Bank of India Act dated 13th February, 2003.

(3.) The appellant is a non-banking financial institution. After the amendment of the Reserve Bank of India (Amendment) Act, 1934, by Act 23 of 1997 (which was brought into force on 09.01.97), non-banking financial institutions were prohibited from conducting business without obtaining certificate of registration under Chapter III B of the Act. One of the condition was that the institution should have had a net owned fund of Rs. 25 lakhs or such other amount not exceeding Rs. 200 lakhs as the RBI notified. This condition was to an extent relieved by a "window" provision, namely, Section 45 IA (3) that allowed existing non-banking financial institutions with net owned fund of less than Rs. 25 lakhs to function for three years from 09.01.97 provided that such company, within three months of fulfilling the requirement of possessing net owned fund informed RBI for that purpose.