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CMA Final · Corporate and Economic Laws · Laws and Regulations related to Banking Sector

Section 45NAA(2) of the RBI Act empowers the Bank to cause an inspection or audit of a group company of an NBFC and its books of account. How does this power relate to the Companies Act, 2013?

The power operates notwithstanding anything to the contrary in the Companies Act, 2013. The RBI may inspect or audit a group company of an NBFC and its books at any time, and the Companies Act cannot be used to restrict that power, nor is Registrar consent required.

  1. AIt can be exercised only after the consent of the Registrar of Companies
  2. BIt applies only if the Companies Act, 2013 permits such inspection
  3. CIt operates notwithstanding anything to the contrary in the Companies Act, 2013Correct
  4. DIt is limited to group companies that are themselves registered NBFCs

Explanation

Sub-section (2) begins with 'Notwithstanding anything to the contrary contained in the Companies Act, 2013', so the Bank's power prevails over that Act. No ROC consent is required, and the group company need not itself be an NBFC.

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