Ujjal Bhuyan, J.

Heard Mr. P.K. Tiwari, learned Senior counsel, assisted by Mr. M.K. Mishra, learned counsel for the petitioners and Mr. A.K. Sharma, learned Additional Advocate General, Mizoram, assisted by Mr. D. Kalita, learned counsel for the respondents.

2. By filing this petition under Article 226 of the Constitution of India, petitioner seeks a declaration that Mizoram Money Lenders and Accredited Loan Providers (Regulation) (First Amendment) Act, 2011 is unconstitutional being ultra vires the constitution. A related challenge has been made to the consequential letter dated 01.12.2011 issued by the Deputy Commissioner, Champhai district directing petitioner No.1 to register itself as an ‘accredited loan provider’ as per the Mizoram Money Lenders and Accredited Loan Providers (Regulation) Act, 2010, as amended by the Mizoram Money Lenders and Accredited Loan Providers (Regulation) (First Amendment) Act, 2011.

3. Petitioner No.1 is the North-East Region Fin-services Ltd. It is a non-deposit taking Non-Banking Finance Company (NBFC) incorporated under the Companies Act, 1956 and registered with the Reserve Bank of India under Section 45-1A of the Reserve Bank of India Act, 1934 (RBI Act). It is stated that petitioner No.1 has 122 Branches in 12 States out of which 28 Branches are in the State of Mizoram. Petitioner No.1 avails finance from institutional creditors like Oriental Bank of Commerce, Corporation Bank, Bank of India, Union Bank of India, Punjab National Bank, UCO Bank, etc., for the purpose of on-lending to individuals, self-help groups, joint liability groups and other proprietary sectors under various categories like agriculture, micro and small enterprises, etc.

4. It is stated that the categories under which on-lending is extended is in strict compliance to the directions of the Reserve Bank of India (RBI). The rate of interest at which petitioner No.1 extends financial assistance to its borrowers cannot exceed the rate fixed by the RBI.

5. Petitioner No.2 is a shareholder and a Director of petitioner No.1. It is stated that petitioner No.2 was authorized by the Board of Directors to represent petitioner No.1 in the present proceeding.

6. For the sake of convenience, we will refer to both the petitioners as petitioner Company.

7. In order to regulate money lending in the State of Mizoram and for protecting the interest of borrowers for regulating transaction of money and to ensure transparency in such transactions, State of Mizoram enacted Mizoram Money Lenders and Accredited Loan Providers (Regulation) Act, 2010 (briefly, 2010 Act hereinafter). The said Act had received the assent of the Governor on 01.10.2010 and was published vide notification dated 19.10.2010 in the Mizoram Gazette (Extra-ordinary) dated 21.10.2010. The preamble to this Act says that it is an act to regulate money lending in the State of Mizoram and for matters connected therewith and incidental thereto. It further says that it was expedient to make provisions for protecting the interest of borrowers, for regulating transactions of money lending and to secure more transparency in such transactions in the State of Mizoram. Section 1(4) of the 2010 Act provided that nothing contained in this said Act shall apply to the RBI or any bank or any Non-Banking Finance Company/Micro Finance Company registered under the RBI. In other words, provisions of the 2010 Act were not applicable to the RBI or any bank or any NBFC/Micro Finance Company registered under the RBI. Therefore, as per Section 1(4) of the 2010 Act, the provisions of the said Act were not applicable in the case of the petitioner Company.

7.1. As per Section 2(1) of the 2010 Act, ‘accredited loan provider’ has been defined to mean a person or a firm who or which has a contractual arrangement with an institutional creditor for receiving finance from such institutional creditor for the purpose of lending to the borrower in his or its name.

7.2. Section 2(8) of the 2010 Act defines the