CS Executive · Economic, Commercial and Intellectual Property Laws · Overseas Direct Investment
During an inspection of an authorised dealer bank, a Reserve Bank officer specially authorised in writing asks the bank's directors to produce books and accounts relating to overseas investment remittances. Under Section 12(2), what is the duty of the bank and its directors?
The authorised person, and its directors or officers if it is a company, must produce the books, accounts and other documents and furnish any statement or information the inspecting officer requires, within the time and in the manner the officer directs. No court order is required.
- ATo produce the books, accounts and documents and furnish the information required within the time and manner the officer directsCorrect
- BTo produce them only after the Reserve Bank obtains a court order
- CTo furnish only a summary statement once a year
- DTo produce them only if the bank considers the request necessary
Explanation
Section 12(2) makes it the duty of every authorised person, and where it is a company or firm, every director, partner or other officer, to produce books, accounts and documents and furnish information as the inspecting officer requires, within the time and manner he directs. No court order is needed, and the bank has no discretion to decide necessity.
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