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CS Professional · Banking and Insurance - Laws and Practice · Overview of Indian Banking System

Mr. Raghav Iyer is appointed as the chairman of Sundaram Commercial Bank Ltd., a banking company, on a whole-time basis. A complaint alleges he accepted an illegal gratification. Under the Banking Regulation Act, 1949, what is his status for the purposes of Chapter IX of the Indian Penal Code?

He is deemed to be a public servant. Section 46A of the Banking Regulation Act deems a whole-time chairman of a banking company to be a public servant for Chapter IX of the Indian Penal Code, regardless of whether the bank is private or government owned.

  1. AHe is deemed to be a public servantCorrect
  2. BHe is a public servant only if the bank is government owned
  3. CHe is not a public servant because the bank is a company
  4. DHe is a public servant only after RBI notifies him

Explanation

Section 46A deems every chairman appointed on a whole-time basis, managing director, director, auditor, liquidator, manager and any other employee of a banking company to be a public servant for Chapter IX of the IPC. Ownership of the bank and RBI notification are irrelevant, so the other options are wrong.

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