Banking Awareness Inwards Uncomplicated Linguistic Communication – Lesson 20

Dear Gr8 Ambitionists, inwards our previous Banking Awareness 2017 Lesson 19, nosotros direct maintain learnt nearly Important Banking in addition to Financial Organizations inwards attempt indicate of view. In today’s lesson, nosotros shall larn Important Banking Act. Happy Reading 🙂

Banking Awareness 2017 : Important Acts

 

Negotiable Instrument Act, 1881 (NI Act, 1881)

  • Citation : Act no 26 of 1881
  • Date enacted : ix December 1881 
  • Date Commenced : 1 March 1882 
  • An deed to define in addition to better the constabulary relating to promissory notes, Bills of Exchange in addition to cheques. This deed extends to whole Republic of Republic of India d-vrept the province Jammu & Kashmir.
  • Negotiable Instrument 
    • It way a promissory note, pecker of telephone commutation or gibe payable either to social club or to bearer, whether the give-and-take “Order” or “bearer” on the musical instrument or not.
  • Promissory Note
    • It is an musical instrument inwards writing [note beingness a depository fiscal establishment annotation or a currency note] containing an unconditional undertaking, signed past times the maker, to pay a for sure amount of coin to or to the social club of a for sure person, or to, the bearer of the instrument. In promissory annotation at that spot are 2 parties : 
    1. Maker (Debtor) 
    2. Payee (Creditor)
  • Bill of Exchange
    • A pecker of telephone commutation is an musical instrument inwards writing containing an unconditional order, signed past times the maker, directing a for sure someone to pay a for sure amount of coin solely to, or to the social club of a for sure someone or to the bearer of the instrument. 
    • A pecker of exchange, thence is a written acknowledgment of the debt, written past times the creditor in addition to accepted past times the debtor. There are ordinarily 3 parties : drawer, drawee and payee. Drawer himself may endure the payee. 
    • Classification of bills
      • Inland & unusual bill 
      • Time in addition to need bill 
      • Trade & Accommodation bills 
  • Cheques  
    • A gibe is a pecker of telephone commutation drawn on a specified banker in addition to non expressed to endure payable otherwise than on demand. 
    • A gibe is pecker of telephone commutation amongst 2 to a greater extent than qualifications. 
      • It is ever drawn on a specified banker. 
      • It is ever payable on demand.
    • Consequently all cheques are pecker of telephone commutation but all bills are non cheque
  •  Hundis
    • A “Hundi’ is a negotiable musical instrument written inwards an oriental language. The term hundi includes all indigenous negotiable instruments whether they may endure inwards the flat of notes or bills. 

RBI Act 1934 

  • Enacted past times : Parliament of India
  • Date Enacted : vi march 1934 
  • Date Commenced : 1 Apr 1935
  • RBI act, 1934 is the legislative deed nether which RBI was formed. This deed along amongst the companies act, which was amended inwards 1936, were meant to furnish a framework for the supervision of banking firms inwards India.
    • The deed contains the Definition of the so-called scheduled banks, equally they are mentioned inwards the 2nd scheduled of the act. These are banks which were to direct maintain paid upwards majuscule & reserves inwards a higher house Rs. 500,000.
    • Section 24 states that the maximum denomination a annotation tin endure 101000.
    • Section 31 states that inwards Republic of Republic of India solely the RBI or the key govt. tin number in addition to direct maintain promissory notes that are payable on demand. However, cheque, that are payable on demand, tin endure issued past times anyone.

Banking Regulation Act, 1949

  • It is a legislation inwards Republic of Republic of India that regulates all banking firms inwards India. Initially the constabulary was applicable solely to banking companies. But inwards 1965 it was amended to arrive applicable to co-operative banks a advertizement to innovate other changes.

Consumer Protection Act, 1986

  • It is an deed of the parliament of Republic of Republic of India enacted inwards 1986 to protect interests of consumers inwards India. It makes provision for the establishment of consumer councils & other government for the village of consumer’s disputes in addition to for matters connected therewith. This deed is non applicable inwards J & K. This deed recognised vi of the eight rights of consumer in addition to provided inwards united nations charter.
  • Consumer Disputes Redressal Agencies 
    • DCDRF (District Consumer Disputes Redressal Forum)
      • It is a district flat courtroom that deals amongst cases valuing upwards to 2 million.
    • SCDRC (State Consumer disputes Redressal Commission)
      • It is a province flat courtroom that takes upwards cases valuing less than 10 million. 
    • NCDRC (National Consumer disputes Redressal Commission)
      • It is a national flat courtroom that industrial plant for the whole province in addition to deals amongst amount to a greater extent than than 10 million.

The Competition Act 2002

  • It was enacted past times the parliament of Republic of Republic of India & governs Indian contest law. It replaced the archaic monopoly in addition to Restrictive Trade Practices Act, 1969. Under this legislation, the competiton committee of Republic of Republic of India was established to preclude activities that direct maintain an adverse result on contest inwards India. It is non applicable inwards J & K inwards all Industries including Banking
  • Amendments
    • The contest act, 2002 was amended past times the contest (amendment) act, 2007 in addition to in 1 lawsuit again past times the contest (amendment) act, 2009, An amendment pecker introduced inwards 2006 was withdrawn.

COMPAT (Competition Appellate Tribunal)

  • Set upwards : xv May, 2009 
  • Headquarter : New Delhi 
  • Chairman : G.S. Singhvi 
  • The COMPAT is a statutory organisation established nether the provision of the contest deed 2002, to listen & dispose of appeals against whatever administration issued or conclusion or social club passed past times the contest committee of India.
  • Every appeal should endure filled within lx days from the engagement on which a re-create of administration or conclusion made past times contest committee of Republic of Republic of India is received. The tribunal may entertain an appeal afterwards cash inwards one’s chips menses of lx days if it is satisfied
  • If a someone who denys whatever social club of Appellate Tribunal he shall endure liable for penalty upto 1 crore or imprisonment for a term upto 3 years or both.
  • Team
    • The appellate tribunal consists, chairperson in addition to 2 members appointed past times key govt. Chairperson should endure or has been a estimate of Supreme Court or master copy judge of High courtroom in addition to he is appointed for five years in addition to tin endure reappointed

Sarfaesi Act, 2002

(Securitization in addition to Reconstruction of Financial Assets & Enforcement of Security Interest) 

  • It is an deed of Parliament of Republic of Republic of India in addition to empowers Banks/Financial institutions to recover their non-performing assets without the intervention of the court. 
    • The provision of this deed are applicable solely for NPA Loans amongst outstanding inwards a higher house Rs. 1.00 lac. 
    • NPA loan accounts where the amount is less than 20% of the principal & involvement are non eligible to bargain amongst nether this act. 
    • Law doesn’t apply to unsecured loans 
    • This deed is non applicable to RRBs
    • This deed allows banks in addition to other fiscal establishment to auction residential or commercial properties to recover loans. The starting fourth dimension property reconstruction fellowship (ARC) of India, ARCIL (Assets reconstruction fellowship Republic of Republic of India Ltd.) was laid upwards nether this act. 
  • Non-performing assets should endure backed past times securities charged to the depository fiscal establishment past times way of hypothecation or mortgage or assignment.
  • SARFAESI Act, 2002 gives ability of “Seize in addition to desist” to banks. Banks tin give a notice inwards writing to the defaulting borrower requiring it to discharge its liabilities inside lx days. If the borrower fails to comply amongst the Notice, the depository fiscal establishment may bring recourse to 1 or to a greater extent than of the next measures : 
    • Take possession of the safety for the loan. 
    • Sale or lease or assign the correct over the security. 
    • Manage the same or appoint whatever someone to care the same.

DRT (Debt Recovery Tribunal)

  • These tribunals were established nether the Recovery of Debts due to banks in addition to fiscal establishment act, 1993, to bargain amongst the cases of recovery of debts inwards a higher house Rs. 10 lakh due to banks & fiscal institutions
  • QIB (Qualified Institutional Buyer) 
    • It is fiscal establishment or an insurance fellowship or a bank. It is a province fiscal corporation or province industrial evolution corporation or trustee or whatever property administration company. Making an investment on behalf of a usual fund or provident fund or gratuity fund or pension fund or a unusual institutional investor, registered nether the SEBI act, 1992 or whatever other trunk corporate equally may endure specified past times SEBI
    • This Definition covers several categories of institutional investors but doesn’t include a fellowship registered nether the companies act, 1956. If whatever fellowship wants to locomote a qualified institutional buyer in addition to so it volition direct maintain to acquire such a registration from SEBI. 

Money Laundering

  • It is the procedure of transforming the proceeds of law-breaking into ostensibly legitimate coin or other assets. Broadly at that spot are 3 steps to coin laundering activity equally per the RBI : 
    • Placement : “Placement” refers to the physical disposal of mass cash proceeds derived from illegal activity.
    • Layering : “Layering” refers to separation of illicit proceeds from their beginning past times creating complex layers of fiscal transactions. Layering conceals the audit trail & provides anonymity.
    • Integration : “Integration” refers to the re-injection of the laundered proceeds dorsum into the economic scheme inwards such a way that they re-enter the fiscal scheme equally normal concern funds.

Anti-Money Laundering (AML)

It is a term mainly used inwards the fiscal & legal industries to push clit the legal controls that necessitate fiscal institutions & other regulated entities to prevent, detect, study money-laundering activities. 

Prevention of Money Laundering Act, 2002

  • It is an deed of the parliament of India, enacted to preclude money-laundering. The deed was amended inwards the yr 2012. Salient Features : • Punishment for Money-Laundering: The deed prescribes that whatever someone found guilty of coin laundering shall endure punishable amongst rigorous imprisonment from 3 years to seven years in addition to besides endure liable to a fine upwards to five lakh rupees. If the offense relates to offense nether the Narcotic drugs & psychotropic substances Act, 1985 the maximum penalty could extend to imprisonment for 10 years. 
  • However vide amendment of PMLA deed 2002 inwards 2012, the upper ceiling on the quantum of fine has been done away with.
  • Appellate Tribunal : It is the trunk appointed past times GOI. It is given the ability to listen appeals against the orders of the adjudicating potency & whatever other potency nether the act. Orders of the tribunal tin endure appealed inwards appropriate high courtroom (for that jurisdiction) & in conclusion to Supreme Court. 

Right to Information Act, 2005

  • The RTI is an deed of the Parliament of Republic of Republic of India “to furnish for setting out the practical regime of correct to data for citizens” in addition to replaces the one-time liberty of Information act, 2002. The deed applies to all states & Union Territories of Republic of Republic of India except Jammu in addition to Kashmir. This constabulary was passed past times Parliament on xv June 2005 in addition to came fully into strength on 12 October 2005.
  • The Act specifies the fourth dimension limits for replying to the request
    • If the asking has been made to the PIO (Public data officer), the respond is to endure given inside thirty days of receipt. 
    • If the asking has been made to APIO (Assistant Public Information Officer), the respond is given inside 35 days of receipt. 
    • Information concerning Corruption in addition to Human rights violations by scheduled safety agencies are to endure provided within 45 days but amongst the prior approving of the key data commission.
    • However if life or liberty of whatever someone is involved, the PIO is expected to respond inside 48 hours.

Banking Ombudsman Scheme (2006)

  • It has been operative from 1 Jan 2006. Banking ombudsman is a quasi judicial authority surgical operation nether India’s Banking ombudsman scheme 2006, in addition to the potency was created to enable resolution of complaints of customers of banks relating to for sure services rendered past times the banks. 
    • Banking ombudsman (BO) scheme applies to Whole Republic of Republic of India (including Jammu & Kashmir) 
    • Appointment in addition to Tenure
      • RBI has reserved this BO postal service for its ain CGMs & GMs. 
      • Tenure: 3 years at a time. 
      • Reappointment: Yes possible. 
    • BO deals amongst the affair less than or equal to Rs. 10 lakh
    • If client non satisfied amongst ombudsman. He tin approach to Deputy Governor of RBI. 

FERA & FEMA

  • FERA (Foreign Exchange Regulation Act)
    • It is legislation that was passed past times the Indian parliament inwards 1973 in addition to came into result equally of 1 Jan 1974. FERA imposed strict regulations on transactions involving unusual telephone commutation & controlled the import in addition to export of currency. FERA was repealed past times the govt. inwards 1999 in addition to replaced past times the FEMA, which liberalized unusual telephone commutation controls in addition to removed many restrictions on unusual investment. 
  • FEMA (Foreign Exchange Management Act, 1999) :
    • It is an deed of the Parliament of Republic of Republic of India “to consolidate in addition to better the constabulary relating to unusual telephone commutation amongst the objective of facilitating external merchandise in addition to payments in addition to for promoting the orderly evolution in addition to maintenance of unusual telephone commutation marketplace position inwards India.” 
    • Note : FEMA came into result on the Pt June 2000, replacing FERA.

That’s all for right away friends. In our adjacent Banking Awareness lesson, nosotros shall larn nearly Credit Rating Agencies inwards India. Happy Reading 🙂

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