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

The Reserve Bank cancels the licence of Meghdoot Bank Ltd under Section 22 because the company failed to comply with a licence condition. The decision is communicated on 5 March. By which period may the bank appeal, and to whom?

The bank may appeal to the Central Government within thirty days from the date the cancellation decision is communicated to it. The Central Government's decision on the appeal is final. The section does not provide for a 60-day period or an appeal to the High Court.

  1. AWithin 30 days, to the Central GovernmentCorrect
  2. BWithin 60 days, to the Central Government
  3. CWithin 30 days, to the High Court
  4. DWithin 90 days, to the Reserve Bank itself

Explanation

Section 22(5) lets a banking company aggrieved by a licence cancellation appeal to the Central Government within thirty days from the date the decision is communicated. Section 22(6) makes the Central Government's decision final once an appeal is preferred. A 60-day period or an appeal to a court is not what the section provides.

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