Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Reserve Bank of India Act 1958 (Kerala Act) – Gujarat Money Lenders Act 2011 (Gujarat Act) 1934 (RBI Act) – Chapter III-B – Kerala Money Lenders Act |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case(s) Referred | Referred Case 0 Referred Case 1 Referred Case 2 Referred Case 3 Referred Case 4 Referred Case 5 Referred Case 6 Referred Case 7 Referred Case 8 |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Disposed Off |
Headnote | Reserve Bank of India Act, 1934 (RBI Act) – Chapter III-B – Kerala Money Lenders Act,1958 (Kerala Act) – Gujarat Money Lenders Act, 2011 (Gujarat Act) – Applicability of States’ Act on Non-Banking Financial Companies – Whether Non-Banking Financial Companies (NBFCs) regulated by the Reserve Bank of India, in terms of the provisions of Chapter III-B of the RBI Act could also be regulated by State enactments such as Kerala Act and Gujarat Act – Held : By Act 23 of 1997, amendment made to Chapter III-B, after which this Chapter has become a complete Code in so far as NBFCs are concerned – The scheme of Chapter III-B of the RBI Act shows that the power of intervention available for the RBI over NBFCs, is from the cradle to the grave – Once it is found that Chapter III-B of the RBI Act provides a supervisory role for the RBI to oversee the functioning of NBFCs, from the time of their birth (by way of registration) till the time of their commercial death (by way of winding up), all activities of NBFCs automatically come under the scanner of RBI – As a consequence, the single aspect of taking care of the interest of the borrowers which is sought to be achieved by the State enactments gets subsumed in the provisions of Chapter III-B – The Kerala Act and the Gujarat Act will have no application to NBFCs registered under the RBI Act and regulated by RBI. Principles/Doctrines – Doctrine of Eclipse, conflict and repugnancy – The moment the Parliament stepped in to codify the law relating to registration and regulation of NBFCs, by inserting certain provisions in Chapter III-B of the RBI Act, the same would cast a shadow on the applicability of the provisions of the Kerala Act to NBFCs registered under the RBI Act and regulated by RBI – In case of Gujarat, State of Gujarat contended that the Gujarat Act exempts NBFCs registered under the RBI Act from seeking registration under the Gujarat Act – However, u/s. 5(2) of the Gujarat Act, NBFCs registered under the RBI Act are deemed to have been registered under the Gujarat Act – Gujarat Act, 2011 tacitly recognizes the regulation of NBFCs under the RBI Act – Yet the State got the assent of only the Governor – Therefore, Kerala Act and the Gujarat Act will have no application to NBFCs registered under the RBI Act and regulated by RBI – Reserve Bank of India Act, 1934 (RBI Act) – Kerala Money Lenders Act,1958 (Kerala Act) – Gujarat Money Lenders Act, 2011 (Gujarat Act). |
Judge | Hon'ble Mr. Justice V. Ramasubramanian |
Neutral Citation | 2022 INSC 545 |
Petitioner | Nedumpilli Finance Company Limited |
Respondent | State Of Kerala & Ors. |
SCR | [2022] 7 S.C.R. 1005 |
Judgement Date | 2022-05-10 |
Case Number | 5233 |
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