The Reserve Bank of India (RBI) has exercised its authority under Section 45-IA(6) of the Reserve Bank of India Act, 1934, to cancel the Certificate of Registration (CoR) of two Non-Banking Financial Companies (NBFCs). Following this action, the entities are no longer permitted to operate as NBFCs or undertake any business activities as defined under Section 45-I(a) of the RBI Act. Here are the details:
1. Ulhas Securities Private Limited
- Address:
Q-202, Coral, Parshwanath Atlantis Park,
Near Balaji Agora Mall, S.P. Ring Road,
Gandhinagar, Gujarat – 382424 - Registration Number: N.01.00462
- Date of Registration: December 8, 2003
- Cancellation Date: September 24, 2024
2. Sikar Investment Co Ltd
- Address:
Shri Ramji Sadan, 30-B, New Civil Lines,
Bharatpur City, Bharatpur, Rajasthan – 321001 - Registration Number: 10.00029
- Date of Registration: March 6, 1998
- Cancellation Date: October 7, 2024
Consequences of CoR Cancellation
As a result of this cancellation, these companies must cease operating as NBFCs immediately. They are prohibited from engaging in any financial transactions typically associated with NBFCs. Such actions are often taken due to non-compliance with RBI regulations, operational irregularities, or failure to meet mandated requirements.
Understanding Section 45-IA(6)
This section grants the RBI the authority to revoke the registration of an NBFC under circumstances such as:
- Discontinuation of business operations as an NBFC.
- Non-compliance with registration conditions.
- Violations of any provisions under the RBI Act.
Significance of RBI’s Action
The RBI’s decision to revoke the CoR emphasizes its role in upholding financial stability and protecting stakeholders’ interests. Such measures ensure that only compliant and trustworthy entities operate within the financial ecosystem, thereby reducing risks to the public and the economy.
Advice for Stakeholders
Stakeholders and customers associated with these NBFCs should:
- Avoid initiating new transactions with these companies.
- Contact the respective companies for updates or clarifications regarding existing agreements.
- Stay informed about future updates from the RBI or the companies themselves.
Conclusion
The RBI’s cancellation of these two NBFCs’ CoRs highlights the importance of adhering to regulatory standards. This action reinforces the regulator’s commitment to maintaining a safe and reliable financial environment in India.
