1. Few Acts S.K.Mishra MBA(Fin.),CAIIB,CISA(USA),BS7799 LA(UK) Asst. General Manager, Central Bank Of India Central Office Mumbai

2. Reserve Bank OF India Act 1935

3. RBI Act Established on April 1, 1935 Managed by Central Board of Directors Four local boards at Mumbai, Delhi, Calcutta and Chennai It has 1 Governor, Provision for 4 Dy. Governors and 15 Directors

4. RBI Functions Issuance of currency : sec 22 Bankers to the Government : sec 20 Bankers to the Banks : sec 17(2) and (3) Controller of Banks : Controller of Credit : sec 21 and 35A Statutory Reserves : sec 42 Collection of information : sec45c and d Maintenance of external value Monetary control

5. RBI Act Sec 2(e) Scheduled Bank Sec 17 Business RBI may transect Sec 19 Business RBI may not transect Sec 31 Prohibits issue of Bill of Exchange payable to bearer Sec 45H-45T Regulations related to non Banking Finance companies Sec 49 Announce Bank rate

6. Banking Regulation Act 1949

7. BR Act 1949 Sec 5(b) Banking means accepting for the purpose of lending or investment of deposits of money from public repayable on demand or otherwise and repayable by cheque, drafts order or otherwise

8. BR Act 1949 Sec 5(a) Approved Securities means such securities authorised by Central Government under clause (b) of sec. 20 of the Indian Trust Act 1882 OR Securities in which a trustee may invest money under clause (a), (b), (bb) or (d) of the said Act

9. BR Act 1949 Sec 5(f) Demand liabilities are the liabilities which must be met on demand Otherwise time liabilities

10. BR Act 1949 Sec 5(n) Secured loans Sec 9 Immovable property except for own use Sec 15 Prohibits dividend payment till all expenses capitalised are not completely written off Sec 17(1) Create reserve fund 20% of profit Sec 19 Permits Banks to form subsidiary Co. Sec 19(2) No Bank Shall hold shares in any company amount > 30% of the paid up capital of that co. or its own paid up capital plus reserves which ever is less

11. BR Act 1949 Sec 20(a) Cannot grant advance against its own shares Sec 21A Rate of interest charged by the banks are not subject to scrutiny by courts on the ground of being excessive Sec 23 Branch Licensing Sec 24 SLR 25-40% Sec 26 Unclaimed deposits of 10 years with in 30 days to RBI Sec 29 Publication of Balance Sheet Sec 30 Balance Sheet to be got audited by qualified Auditors Sec 31 Submit audited Balance Sheet and report in 3 months Sec 35 Inspection of Banks and direction by RBI Sec 45 Power to apply Central Govt. to apply for Suspension of Business by a Banking Co.

12. Nagotiable Instruments Act Negotiable instrument definition as per sec. 13.2[(1) of Negotiable instrument Act. A " negotiable instrument “ means a promissory note, bill of exchange or cheque payable either to order or to bearer.

13. Sec 4. "Promissory note". A " promissory note" is an instrument in writing (not being a bank-note or a currency-note) containing an unconditional undertaking, signed by the maker, to pay a certain sum of money only to, or to the order of, a certain person, or to the bearer of the instrument.

14. Sec 5."Bill of exchange". A "bill of exchange" is an instrument in writing, containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money only to, or to the order of, a certain person or to the bearer of the instrument.

15. Sec 6."Cheque". A "cheque" is a bill of exchange drawn on a specified banker and not expressed to be payable otherwise than on demand.

16. The " holder" of a promissory note, bill of exchange or cheque means any person entitled in his own name to the possession thereof and to receive or recover the amount due thereon from the parties thereto. Sec 8."Holder”

17. " Holder in due course " means any person who for consideration became the possessor of a promissory note, bill of exchange or cheque if payable to bearer, or the payee or indorsee thereof, before the amount mentioned in it became payable, and without having sufficient cause to believe that any defect existed in the title of the person from whom he derived his title. Sec 9.Holder in due course.

18. "Payment in due course" means payment in accordance with the apparent tenor of the instrument in good faith and without negligence to any person in possession thereof under circumstances which do not afford a reasonable ground for believing that he is not entitled to receive payment of the amount therein mentioned. Sec 10."Payment in due course".

19. When a promissory note, bill of exchange or Cheque is transferred to any person, so as to constitute that person the holder thereof, the instrument is said to be negotiated. Sec. 14.Negotiation

20. Where amount is stated differently in figures and words. If the amount undertaken or ordered to be paid is stated differently in figures and in words, the amount stated in words shall be the amount undertaken or ordered to be paid. Sec 18. Where amount is stated differently in figures and words.

21. The maturity of a promissory note or bill of exchange is the date at which it falls due. Days of grace. Every promissory note or bill of exchange which is not expressed to be payable on demand, at sight or on presentment is at maturity on the third day after the day on which it is expressed to be payable. Sec 22. "Maturity"

22. Presentment for payment must be made during the usual hours of business, and, if at a banker's, within banking hours. Sec 65.Hours for presentment.

23. When no rate of interest is specified in the instrument, interest on the amount due thereon shall, be calculated at the rate of eighteen per annum,from the date at which the same ought to have been paid by the party Charge, until tender or realization of the amount due thereon, or until such date after the institution of a suit to recover such amount as the Court directs. Sec 80. Rate of Interest when no rate specified.

24. 85. 3[(1)] Cheque payable to order. Where a cheque payable to order purports to be endorsed by or on behalf of the payee, the drawee is discharged by payment in due course. Sec 85. 3[(1)] Cheque payable to order

25. Any material alteration of a negotiable instrument renders the same void as against any one who is a party thereto at the time of making such alteration and does not consent thereto, unless it was made in order to carry out the common intention of the original parties: Sec 87.Effect of material alteration

26. Where a promissory note, bill of exchange or cheque has been materially altered but does not appear to have been so altered, or where a cheque is presented for payment which does not at the time of presentation appear to be crossed or to have had a crossing which has been obliterated, payment thereof by a person or banker liable to pay, and paying the same according to the apparent tenor thereof at the time of payment and otherwise in due course, shall discharge such person or banker from all liability thereon ; and such payment shall not be questioned by reason of the instrument having been altered or the cheque crossed. Sec 89.Payment of instrument on which alteration is not apparent.

27. (a)of consideration (b)as to drawn on such date ; (c)as to accepted within a reasonable time after its date and before its maturity ; (d)as to time of transfer before its maturity; (e)as to order of indorsements made appearing upon a negotiable instrument (f)as to stamp; that a lost promissory note, bill of exchange or cheque was duly stamped ; Sec 118.Presumptions as to negotiable instruments

28. Be punished with imprisonment for a term which may extend to one year, or with fine which may extend to twice the amount of the cheque, or with both: (a)the cheque has been, presented within a period of six months (b)the payee or the holder in due course (c)the drawer of such cheque fails to make the payment within fifteen days Sec 138.Dishonour of cheque for insufficiency, etc., of funds in the account.

29. India Contract Act 1872

30. Parties competent to contract Made with free consent Lawful consideration Lawful object Should not be declared void Sec 10.Important elements

31. Attained Age of majority Of sound mind Not disqualified by any Law Sec 11.Competance of the party

32. A contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself or by the conduct of any other person Sec 124.Indemnity

33. A contract to perform promise or discharge the liability of a third person in case of his default Sec 126. Guarantee

34. Party 3 2 Liability Subsisting Contingent Loss First Debtor Indemnifier Contract 3 1 Object Security Making up Comparison Guarantee Indemnity

35. Sec 42 In joint promise all the promisors are liable both joint and several Sec 43 Any or one may be compelled to perform the whole Sec 68 Loans to minors Sec 128 Liability of Surety is co- extensive with that of a principal debtor Sec 132 Any change in contract without surety consent discharges Various sections

36. Threadless case study bestees

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42. Thanks !