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CS Executive · Economic, Commercial and Intellectual Property Laws · Law relating to Foreign Exchange Management

The Reserve Bank suspects that Orion Bank, an authorised person, has furnished incorrect statements about its foreign exchange business. It wants to verify them on the premises. Which statement correctly reflects the Act?

The Reserve Bank may at any time cause an inspection of the authorised person's business by an officer it has specially authorised in writing. Verifying the correctness of information furnished is one of the stated purposes. The Act requires no court order, Central Government approval or yearly limit.

  1. AOnly a civil court can order inspection of the authorised person
  2. BThe Reserve Bank may at any time cause inspection by an officer specially authorised in writing by itCorrect
  3. CInspection is allowed only after the Central Government gives prior approval
  4. DInspection can be made only once every year

Explanation

The Reserve Bank may at any time cause an inspection of the business of an authorised person by an officer specially authorised in writing, including for verifying the correctness of information furnished. No court order, Central Government approval or annual limit is required by the text.

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