$~36 * IN THE HIGH COURT OF DELHI AT NEW DELHI Date of decision: 15th January, 2026 Uploaded on: 22^nd January, 2026 + W.P.(C) 7040/2020 & CM APPL. 24001/2020 GOLI FINANCE LIMITED .....Petitioner Through: Mr. Rohan Rai, Adv.

versus UNION OF INDIA & ANR. .....Respondents Through: Mr. Ramesh Babu, Ms. Manisha Singh, Ms. Tanya Chowdhary, Ms. Nisha Sharma, Mr. Rohan Srivastava, Advs. for RBI (9971671294)

CORAM:

JUSTICE PRATHIBA M. SINGH JUSTICE MADHU JAIN Prathiba M. Singh, J. (Oral)

1. This hearing has been done through hybrid mode.

2. The challenge in the present writ petition is for setting aside the impugned order dated 11^th May, 2020 passed by the Appellate Authority under Section 45-IA of the Reserve Bank of India Act, 1934 (hereinafter “RBI Act”). Vide the impugned order, the RBI’s order dated 5th February, 2019 cancelling the Petitioner’s Certificate of Registration as a Non-Banking Financial Company (hereinafter “NBFC”) was upheld.

3. The case of the Petitioner is that the RBI had issued a notification dated 20^th April, 1999 by which the “Net Owned Fund” (hereinafter “NoF”) of an NBFC, which wanted to commence its business on or after 20^th April, 1999, was increased from Rs. 25 lakh to Rs.2 crores. However, the NBFCs which were already registered with RBI or whose applications seeking the Certificate of Registration were filed prior to 20^th April, 1999, were exempted from application of the said notification.

4. The Petitioner was issued the Certificate of Registration by the RBI on 20th January, 2001. Thereafter, the Petitioner was converted to Category-B NBFC and a fresh Certificate of Registration was issued on 30th December, 2014. In the meantime, a revised regulatory framework came into existence on 10^th November, 2014 as per which the RBI had directed that the requirement of minimum NoF of Rs. 2 crore was made applicable to all NBFCs. Further, in view of the new regulatory framework vide notification dated 27^th March, 2015, RBI mandated all the NBFCs, including the existing NBFCs, to have the NoF of Rs. 2 crores. As per the said notification, existing NBFCs would be permitted to continue functioning subject to achieving NoF of Rs. 1 crore before 1st April, 2016 and Rs. 2 crores before 1st April, 2017. 5. The case of the Petitioner is that the notification dated 27th March, 2015 was published in the official gazette on 11th July, 2016 and that the Petitioner could not take steps to achieve the increased NoF due to not being timely informed of the said notification.

6. It is stated that on 2nd May, 2018, a Show Cause Notice (hereinafter “SCN”) was issued by the RBI as to why the Petitioner’s registration ought not be cancelled for not achieving the NoF of Rs. 2 crores, in terms of the revised regulatory framework and notification dated 27th March, 2017.

7. The Petitioner is stated to have achieved the NoF of Rs. 2 crores by 31st July, 2018. A response was also filed to the SCN on 14 January, 2019, wherein the Petitioner informed the RBI that it had achieved the NoF of Rs. 2 crore. However, on 5^th February, 2019, the Petitioner’s Certificate of Registration was cancelled by the RBI. The Appellate Authority was then approached by the Petitioner challenging the said order of the RBI, which dismissed the said appeal vide the impugned order dated 11^th May, 2020.

8. Ld. Counsel for the Petitioner relies upon orders passed in similar matters by coordinate Benches as also ld. Single Judges of this Court which hold that since the NoF was achieved prior to the issuance of SCN or prior to passing of the order of cancellation by the RBI, the Petitioner deserves to be heard and the matters deserve to be remanded back for fresh consideration by the RBI.

9. Mr. Ramesh Babu, ld. Counsel for the RBI, submits that considering the fact that Petitioner had achieved the NoF requirement of Rs. 2 crores prior to passing of the cancellation order, the matter may be remanded for fresh adjudication. However, the said consideration should be on the basis