PAYMENT AND SETTLEMENT SYSTEMS ACT 2007
(1) This Act may be called the Payment and Settlement Systems Act, 2007.
(2) It extends to the whole of India.
(3) It shall come into force on such date1 as the Central Government may, by notification in the Official Gazette, appoint and different dates may be appointed for different provisions of this Act, and any reference to the commencement in any such provision of this Act shall be construed as a reference to the commencement of that provision.
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1. Enforcement date appointed as 12th day of August, 2008 by the Notification No. S.O.2032(E) dated 12.08.2008.
The Payment and Settlement Systems Act, 2007 (PSS Act) was enacted to regulate and supervise payment systems in India, designating the Reserve Bank of India (RBI) as the authority for this purpose. Section 1 of the Act lays the foundational framework by providing the short title, extent, and commencement of the Act.
Section 1 of the PSS Act states:1. The Act may be called the Payment and Settlement Systems Act, 2007.2. It extends to the whole of India.3. It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.
The scope of Section 1 is primarily administrative, setting the stage for the provisions that follow in the Act. It ensures that the Act is recognized legally and applies uniformly across the country.
Section 1 does not prescribe any punishments or penalties; it is purely introductory. However, subsequent sections of the Act detail penalties for violations related to payment systems.
(1) In this Act, unless the context otherwise requires,-
(a) "bank" means,-
(i) a bank inclu'ded in the Second Schedule to the Reserve Bank of India Act, 1934(2 of 1934);
(ii) a post office savings bank;
(iii) a banking company as defined in clause (c) of section 5 of the Banking Regulation Act, 1949(10 of 1949);
(iv) a co-operative bank as defined in clause (cci) of section 5, as inserted by section 56, of the Banking Regulation Act, 1949(10 of 1949); and
(v) such other bank as the Reserve Bank may, by notification, specify for the purposes of this Act;
(b) "derivative" means an instrument, to be settled at a future
(1) The Reserve Bank shall be the designated authority for the regulation and supervision of payment systems under this Act.
(2) The Reserve Bank may, for the purposes of exercising the powers and performing the functions and discharging the duties conferred on it by or under this Act, by regulation, constitute a committee of its Central Board to be known as the Board for Regulation and Supervision of Payment and Settlement Systems.
(3) The Board constituted under sub-section (2) shall consist of the following members, namely:-
(a) Governor, Reserve Bank, who shall be the Chairperson of the Board;
(b) Deputy Governors, Reserve Bank, out of whom the Deputy Governor who is in-charge of the Payment and Settlement Systems, shall be the Vice-Chairperson
Section 3 of the Payment and Settlement Systems (PSS) Act, 2007, establishes the Reserve Bank of India (RBI) as the primary authority responsible for the regulation and supervision of payment systems in India. This section forms the legal foundation for the RBI's regulatory powers over electronic payment infrastructures, including systems like FASTag and NETC.
Section 3 explicitly designates the RBI as the "designated authority" for regulating and supervising payment systems under the Act. It empowers the RBI to exercise all necessary powers to ensure the smooth functioning, security, and integrity of payment and settlement systems in India.
The section covers all types of payment systems, whether operated by banks, non-banks, or private entities, that facilitate electronic transactions. It authorizes the RBI to regulate, supervise, and enforce compliance to maintain financial stability and protect consumer interests.
While Section 3 itself primarily confers powers, penalties for violations of regulations or directives issued by the RBI under the PSS Act are detailed in other sections (e.g., Sections 26 and 27). Penalties may include fines, imprisonment, or both for contraventions such as unauthorized operation or non-compliance.
This commentary synthesizes judicial interpretations and regulatory frameworks based on the provided sources, emphasizing the central role of Section 3 in empowering the RBI to oversee India's evolving payment landscape.
(1) No person, other than the Reserve Bank, shall commence or operate a payment system except under and in accordance with an authorisation issued by the Reserve Bank under the provisions of this Act:
Provided that nothing contained in this section shall apply to-
(a) the continued operation of an existing payment system on commencement of this Act for a period not exceeding six months from such commencement, unless within such period, the operator of such payment system obtains an authorisation under this Act or the application for authorisation made under section 7 of this Act is refused by the Reserve Bank;
(b) any person acting as the duly appointed agent of another person to whom the payment is due;
(c) a company accepting payments either from
(1) Any person desirous of commencing or carrying on a payment system may apply to the Reserve Bank for an authorisation under this Act.
(2) An application under sub-section (1) shall be made in such form and in such manner and shall be accompanied by such fees as may be prescribed.
After the receipt of an application under section 5, and before an authorisation is issued under this Act, the Reserve Bank may make such inquiries as it may consider necessary for the purpose of satisfying itself about the genuineness of the particulars furnished by the applicant, his capacity to operate the payment system, the credentials of the participants or for any other reason and when such an inquiry is conducted by any person authorised by it in this behalf, it may require a report from such person in respect of the inquiry.
(1) The Reserve Bank may, if satisfied, after any inquiry under section 6 or otherwise, that the application is complete in all respects and that it conforms to the provisions of this Act and the regulations issue an authorisation for operating the payment system under this Act having regard to the following considerations, namely:-
(i) the need for the proposed payment system or the services proposed to be undertaken by it;
(ii) the technical standards or the design of the proposed payment system;
(iii) the terms and conditions of operation of the proposed payment system including any security procedure;
(iv) the manner in which transfer of funds may be effected within the payment system;
(v) the procedu
(1) If a system provider,-
(i) contravenes any provisions of this Act, or
(ii) does not comply with the regulations, or
(iii) fails to comply with the orders or directions issued by the designated authority, or
(iv) operates the payment system contrary to the conditions subject to which the authorisation was issued,
the Reserve Bank may, by order, revoke the authorisation given to such system provider under this Act:
Provided that no order of revocation under sub-section (1) shall be made-
(i) except after giving the system provider a reasonable opportunity of being heard; and
&
(1) Any applicant for an authorisation whose application for the operation of the payment system is refused under sub-section (3) of section 7 or a system provider who is aggrieved by an order of revocation under section 8 may, within thirty days from the date on which the order is communicated to him, appeal to the Central Government.
(2) The Central Government shall endeavour to dispose of an appeal under subsection (1) within a period of three months.
(3) The decision of the Central Government on the appeal under sub-section (1) shall be final.
(1) The Reserve Bank may, from time to time, prescribe-
(a) the format of payment instructions and the size and shape of such instructions;
(b) the timings to be maintained by payment systems;
(c) the manner of transfer of funds within the payment system, either through paper, electronic means or in any other manner, between banks or between banks and other system participants;
(d) such other standards to be complied with the payment systems generally;
(e) the criteria for membership of payment systems including continuation, termination and rejection of membership;
(f) the conditions subject to, which the system participants shall participate in such fund tran
(1) No system provider shall cause any change in the system which would affect the structure or the operation of the payment system without-
(a) the prior approval of the Reserve Bank; and
(b) giving notice of not less than thirty days to the system participants after the approval of the Reserve Bank:
Provided that in the interest of monetary policy of the country or in public interest, the Reserve Bank may permit the system provider to make any changes in a payment system without giving notice to the system participants under clause (b) or requiring the system provider to give notice for a period longer than thirty days.
(2) Where the Reserve Bank has any objection, to the proposed change for any reason, it shall communicate such objection to the s
The Reserve Bank may call for from any system provider such returns or documents as it may require or other information in regard to the operation of his payment system at such intervals, in such form and in such manner, as the Reserve Bank may require from time to time or as may be prescribed and such order shall be complied with.
The Reserve Bank shall have right to access any information relating to the operation of any payment system and system provider and all the system participants shall provide access to such information to the Reserve Bank.
Any officer of the Reserve Bank duly authorised by it in writing in this behalf, may for ensuing compliance with the provisions of this Act or any regulations, enter any premises where a payment system is being operated and may inspect any equipment, including any computer system or other documents situated at such premises and call upon any employee of such system provider or participant thereof or any other person working in such premises to furnish such information or documents as may be required by such officer.
(1) Subject to the provisions of sub-section (2), any document or information obtained by the Reserve Bank under sections 12 to 14 (both inclusive) shall be kept confidential.
(2) Notwithstanding anything contained in sub-section (1), the Reserve Bank may disclose any document or information obtained by it under sections 12 to 14 (both inclusive) to any person to whom the disclosure of such document or information is considered necessary for protecting the integrity, effectiveness or security of the payment system, or in the interest of banking or monetary policy or the operation of the payment systems generally or in the public interest.
The Reserve Bank may, for the purpose of carrying out its functions under this Act, conduct or get conducted audits and inspections of a payment system or participants thereof and it shall be the duty of the system provider and the system participants to assist the Reserve Bank to carry out such audit or inspection, as the case may be.
Where the Reserve Bank is of the opinion that,-
(a) a payment system or a system participant is engaging in, or is about to engage in, any act, omission or course of conduct that results, or is likely to result, in systemic risk being inadequately controlled; or
(b) any action under clause (a) is likely to affect the payment system, the monetary policy or the credit policy of the country,
the Reserve Bank may issue directions in writing to such payment system or system participant requiring it, within such time as the Reserve Bank may specify-
(i) to cease and desist from engaging in the act, omission or course of conduct or to ensure the system participants to cease and desist from the act, omission or course of conduct; or
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Without prejudice to the provisions of the foregoing, the Reserve Bank may, if it is satisfied that for the purpose of enabling it to regulate the payment systems or in the interest of management or operation of any of the payment systems or in public interest, it is necessary so to do, lay down policies relating to the regulation of payment systems including electronic, non-electronic, domestic and international payment systems affecting domestic transactions and give such directions in writing as it may consider necessary to system providers or the system participants or any other person either generally or to any such agency and in particular, pertaining to the conduct of business relating to payment systems.
Every person to whom a direction has been issued by the Reserve Bank under this Act shall comply with such direction without any delay and a report of compliance shall be furnished to the Reserve Bank within the time allowed by it.
Every system provider shall operate the payment system in accordance with the provisions of this Act, the regulations, the contract governing the relationship among the system participants, the rules and regulations which deal with the operation of the payment system and the conditions subject to which the authorisation is issued, and the directions given by the Reserve Bank from time to time.
(1) Every system provider shall disclose to the existing or potential system participants, the terms and conditions including the charges and the limitations of liability under the payment system, supply them with copies of the rules and regulations governing the operation of the payment system, netting arrangements and other relevant documents.
(2) It shall be the duty of every system provider to maintain the standards determined under this Act.
(1) A system provider shall not disclose to any other person the existence or contents of any document or part thereof or other information given to him by a system participant, except where such disclosure is required under the provisions of this Act or the disclosure is made with the express or implied consent of the system participant concerned or where such disclosure is in obedience to the orders passed by a court of competent jurisdiction or a statutory authority in exercise of the powers conferred by a statute.
(2) The provisions of the Bankers' Book Evidence Act, 1891 shall apply in relation to the information or documents or other books in whatever form maintained by the system provider.
(1) The payment obligations and settlement instructions among the system participants shall be determined in accordance with the gross or netting procedure, as the case may be, approved by the Reserve Bank while issuing authorisation to a payment system.
(2) Where the rules providing for the operation of a payment system indicates a procedure for the distribution of losses between the system participants and the payment system, such procedure shall have effect notwithstanding anything to the contrary contained in any other law for the time being in force.
(3) A settlement effected under such procedure shall be final and irrevocable.
(4) Where a system participant is declared by a court of competent jurisdiction as insolvent or is dissolved or wound up, then notwithstanding anything contained i
(1) The system provider shall make provision in its rules or regulations for creation of panel consisting of not less than three system participants other than the system participants who are parties to the dispute to decide the disputes between system participants in respect of any matter connected with the operation of the payment system.
(2) Where any dispute in respect of any matter connected with the operation of the payment system arises between two or more system participants, the system provider shall refer the dispute to the panel referred to in sub-section (1).
(3) Where any dispute arises between any system participant and the system provider or between system providers or where any of the system participants is not satisfied with the decision of the panel referred to in sub-section (1), the dispute shall be referred to the Re
Section 24 of the Payment and Settlement Systems Act, 2007 (PSS Act) establishes a framework for the resolution of disputes arising within payment systems, ensuring smooth operation and dispute management in electronic payment transactions. It emphasizes the role of system providers in creating dispute resolution mechanisms.
Section 24 mandates that the system provider must formulate rules or regulations for creating a dispute resolution panel comprising at least three neutral system participants, excluding the parties involved in the dispute. This panel is tasked with resolving disputes related to the operation of payment systems.
While Section 24 itself does not specify penalties, violations related to non-compliance with the dispute resolution provisions may attract penalties under other sections of the Act. For instance:- Under Section 25, dishonor of electronic funds transfer due to insufficiency or other reasons can lead to penalties or imprisonment.- Contravention of rules or regulations prescribed under the Act, including dispute resolution provisions, may result in penalties or administrative actions as per the Reserve Bank of India's (RBI) regulatory framework.
This commentary synthesizes the available sources to provide a comprehensive legal analysis of Section 24 of the Payment and Settlement Systems Act, 2007.
(1) Where an electronic funds transfer initiated by a person from an account maintained by him cannot be executed on the ground that the amount of money standing to the credit of that account is insufficient to honour the transfer instruction or that it exceeds the amount arranged to be paid from that account by an agreement made with a bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for a term which may extend to two years, or with fine which may extend to twice the amount of the electronic funds transfer, or with both:
Provided that nothing contained in this section shall apply unless-
(a) the electronic funds transfer was initiated for payment of any amount of money to another person for the discharge, in whole or in part, of
Section 25 of the Payment and Settlement Systems Act, 2007 (PSSA) addresses the criminal liability arising from the dishonour of electronic funds transfers (EFTs). It aims to regulate payment systems, ensuring accountability and deterrence against fraudulent or negligent electronic transactions, aligning with the broader objective of safeguarding the integrity of digital payment mechanisms in India.
Section 25 stipulates that if a person initiates an electronic funds transfer (EFT) which cannot be executed due to insufficiency of funds or other reasons, such person commits an offence. The section prescribes penalties, including imprisonment up to two years, a fine up to twice the amount of the transfer, or both. It also sets out conditions under which liability arises, emphasizing that the transfer must be for the purpose of discharging debt or liability, and that the initiation must conform to procedural guidelines issued by the system provider.
Section 25 applies to electronic funds transfers initiated by individuals or entities for discharge of debts or liabilities, via systems like ECS, RTGS, NEFT, etc. It covers both personal and corporate transactions, and extends to cases where the transfer fails due to insufficient funds or other authorized reasons. The section also incorporates provisions for procedural compliance, emphasizing the importance of following system guidelines and documentation.
The section prescribes:- Imprisonment for up to two years.- Fine up to twice the amount of the electronic funds transfer.- Or both penalties concurrently.The penalties aim to deter wrongful or negligent electronic transactions, ensuring accountability within the digital payment ecosystem.
Special Nature - Section 25 is a special provision tailored specifically for electronic funds transfer offences, distinct from general criminal laws, emphasizing the importance of electronic transactions in modern payment systems [Umashankar Shyamlal Agarwal VS Reliance Capital Ltd. ].
Vicarious Liability - The section extends liability to individuals responsible for initiating or causing the dishonour, including corporate officers or proprietors, under principles similar to vicarious liability principles established in case law [Umashankar Shyamlal Agarwal VS Reliance Capital Ltd. ].
Procedural Guidelines - The offence applies only if the EFT was initiated in accordance with procedural guidelines issued by the system provider, highlighting the importance of compliance with established protocols .
Presumption of Liability - The law presumes that the initiation of the EFT was for discharging a debt or liability unless proved otherwise, shifting the burden of proof to the accused [Umashankar Shyamlal Agarwal VS Reliance Capital Ltd. ].
Scope of Application - Section 25 covers dishonour due to insufficiency of funds or exceeding the authorized amount, thus including cases of stop payment instructions or technical failures [Ritu Jain VS State].
Penalties - The prescribed penalties align with general deterrent principles, with imprisonment up to two years and fines up to twice the transfer amount, indicating the gravity of electronic fund transfer offences .
Relation to Negotiable Instruments - The section explicitly states that provisions of Chapter XVII of the Negotiable Instruments Act, 1881, apply to dishonour of EFTs, integrating traditional cheque dishonour principles into electronic transactions [Umashankar Shyamlal Agarwal VS Reliance Capital Ltd. ].
Offence Cognizance - Cognizance of offences under Section 25 can only be taken upon a complaint made by an officer of the Reserve Bank of India, underscoring the regulatory oversight role .
Liability of Corporate Officers - Section 27 extends liability to persons in charge of companies at the time of contravention, akin to the provisions under Section 141 of the NI Act, emphasizing corporate accountability [Umashankar Shyamlal Agarwal VS Reliance Capital Ltd. ].
Jurisdiction and Complaint - The complaint must be lodged at the appropriate forum where the electronic transfer was initiated or dishonoured, typically within the jurisdiction where the bank account is maintained [RCI Industries & Technologies Ltd. VS State Of Kerala, Represented By Public Prosecutor].
Legal Precedent - Courts have consistently held that the special nature of the PSSA restricts the scope of quashing proceedings, emphasizing that the offences are of a quasi-criminal nature with a focus on systemic regulation [Ritu Jain VS State].
Evasion and Abuse of Process - Cases where accused evade legal process or fail to appear despite orders can justify issuance of warrants or continuation of proceedings, as liability is linked to conduct and procedural compliance [Ritu Jain VS State].
Offence vs. Civil Dispute - The offence under Section 25 is criminal in nature, but it is closely linked to civil liabilities like debt recovery, requiring a careful distinction in proceedings [RCI Industries & Technologies Ltd. VS State Of Kerala, Represented By Public Prosecutor].
Legal Safeguards - The law provides safeguards, including the requirement of a written complaint and procedural compliance, to prevent unwarranted prosecutions and protect genuine transactions [Ritu Jain VS State Through Standing Counsel].
Limitations of Court Interference - High Courts have limited jurisdiction to quash proceedings under Section 25 unless there is a clear lack of prima facie case or procedural lapses, reinforcing the need for trial-based adjudication [V. S. Sumtjetocs Through Proprietor Umashankar Agarwal VS Reliance Capital Ltd. ].
Impact of Technological Compliance - Proper adherence to system guidelines and procedural rules by the initiator can serve as a defense, emphasizing the importance of compliance in electronic transactions .
In summary, Section 25 of the Payment and Settlement Systems Act, 2007, establishes a specialized criminal regime to regulate electronic funds transfer dishonour, emphasizing procedural compliance, vicarious liability, and deterrence through stringent penalties, thereby strengthening the integrity of India's digital payment infrastructure.
(1)Where a person contravenes the provisions of section 4 or fails to comply with the terms and conditions subject to which the authorisation has been issued under section 7, he shall be punishable with imprisonment for a term which shall not be less than one month but which may extend to ten years or with fine which may extend to one crore rupees or with both and with a further fine which may extend to one lakh rupees for every day, after the first during which the contravention or failure to comply continues.
(2) Whoever in any application for authorisation or in any return or other document or on any information required to be furnished by or under, or for the purpose of, any provision of this Act, wilfully makes a statement which is false in any material particular, knowing it to be false or wilfully omits to make a material statement, shall be punishable with imprisonment for
(1) Where a person committing a contravention of any of the provisions of this Act or any regulation, direction or order made thereunder is a company, every person who, at the time of the contravention, was in-charge of, and was responsible to, the company for the conduct of business of the company, as well as the company, shall be guilty of the contravention and shall be liable to be proceeded against and punished accordingly:
Provided that nothing contained in this sub-section shall render any such person liable to punishment if he proves that the contravention took place without his knowledge or that he exercised all due diligence to prevent such contravention.
(2) Notwithstanding anything contained in sub-section (1), where a contravention of any of the provisions of this Act or of any regulation, direction or order made thereunder h
Section 27 of the Payment and Settlement Systems Act, 2007 (PSS Act) delineates the offences committed by companies and other entities in violation of the provisions of the Act. It establishes the legal framework for penalizing contraventions and ensures the enforcement of regulatory compliance by corporate entities involved in payment systems.
Section 27 specifies that any person, including a company, committing a contravention of the provisions of the PSS Act, regulations, directions, or orders issued under the Act, shall be liable for penal action. It empowers authorities to initiate prosecution, impose fines, and take necessary legal action against offenders.
Section 27 applies to:- Violations of the Act’s provisions by entities operating payment systems.- Non-compliance with directions issued by RBI or other authorities under the Act.- Offences committed by corporate bodies, including their officers or directors.- Enforcement actions for breach of regulations, including penalties and criminal prosecution.
"Vicarious Liability" - Section 27 holds companies liable for contraventions committed by their officers or directors, emphasizing vicarious liability to ensure corporate accountability. [: Payment and Settlement Systems Act, 2007] (Chapter VII, Offences and Penalties)]
"Offence Definition" - The section criminalizes breaches of the Act’s provisions, including operating without authorization, non-compliance with directions, or breach of regulations, thereby ensuring strict enforcement. [: Payment and Settlement Systems Act, 2007]
"Criminal Proceedings" - Section 27 facilitates initiation of criminal proceedings against corporate offenders, reflecting the law’s intent to deter violations through penal sanctions. [: Offences and Penalties under PSS Act]
"Scope of Liability" - The liability extends not only to the company but also to officers and persons in charge, aligning with principles of corporate criminal liability. [: Offences by companies]
"Penalties and Fines" - The Act prescribes monetary penalties that can be levied for breaches, with provisions for cumulative fines and imprisonment, reinforcing deterrence. [: Penalties under PSS Act]
"Enforcement Mechanism" - The section empowers authorities to initiate prosecution, seize assets, and take enforcement actions to uphold the integrity of payment systems. [: Powers of RBI under PSS Act]
"Legal Procedure" - The section provides for cognizance of offences by courts, ensuring that violations are prosecuted following due process. [: Cognizance of Offences]
"Corporate Responsibility" - Emphasizes the responsibility of corporate entities to adhere to the provisions, regulations, and directions issued under the Act, failing which penalties are applicable. [: Regulatory Compliance]
"Protection of Payment Systems" - The penal provisions aim to protect the payment and settlement infrastructure from illegal or unauthorized activities, maintaining financial stability. [: Objectives of PSS Act]
"Deterrence and Compliance" - The strict penalties serve as a deterrent against violations, encouraging entities to comply with the regulatory framework. [: Offences and Penalties]
"Legal Precedent" - Courts have upheld the penal provisions of Section 27 as essential for effective regulation and enforcement in the payment systems domain. [: Case Law on PSS Act]
"Scope for Punishment" - The section’s language allows for both criminal prosecution and monetary penalties, providing a comprehensive enforcement mechanism. [: Penalties and Enforcement]
"Vicarious Liability" - The law recognizes that companies can be held liable for acts committed by their officers, reinforcing the importance of corporate governance. [: Offences by Companies]
"Legal Safeguards" - The Act ensures procedural safeguards, including the right to a fair trial and opportunity to defend, before penalties are imposed. [: Due Process in Proceedings]
"Corporate Deterrence" - The penal provisions aim to create a deterrent effect, discouraging illegal activities in the payment and settlement ecosystem. [: Objectives of Penalties]
"Scope for Civil and Criminal Action" - Section 27 complements civil remedies with criminal sanctions, broadening the scope of enforcement. [: Enforcement Framework]
"Legal Certainty" - Clear delineation of offences and penalties under Section 27 provides legal certainty and clarity for regulated entities. [: Legal Clarity]
"Preventive and Punitive" - The section combines preventive measures (through regulation) and punitive actions (through penalties), ensuring a holistic approach to compliance. [: Policy Objectives]
Section 27 of the Payment and Settlement Systems Act, 2007, plays a pivotal role in enforcing compliance by corporate entities involved in payment systems. It ensures that violations are met with deterrent penalties and criminal sanctions, thereby safeguarding the integrity, stability, and trustworthiness of India’s payment infrastructure. The law’s emphasis on vicarious liability, procedural safeguards, and comprehensive enforcement mechanisms underscores its significance in the regulatory architecture of digital payments.
Note: References are made to the sources provided, primarily emphasizing legal principles, judicial interpretations, and the statutory framework surrounding Section 27 of the PSS Act.
(1) No court shall take cognizance of an offence punishable under this Act except upon a complaint in writing made by an officer of the Reserve Bank generally or specially authorised by it in writing in this behalf, and no court, lower than that of a Metropolitan Magistrate or a Judicial Magistrate of the first class shall try any such offence:
Provided that the Court may take cognizance of an offence punishable under section 25 upon a complaint in writing made by the person aggrieved by the dishonour of the electronic funds transfer.
(2) Notwithstanding anything contained in the Code of Criminal Procedure, 1973, a Magistrate may dispense with the personal attendance of the officer of the Reserve Bank filing the complaint, but the Magistrate may, in his discretion, at any stage of the proceedings, direct the personal attendance of the co
A court imposing any fine under this Act may direct that the whole or any part thereof shall be applied in, or towards payment of, the costs of the proceedings.
(1) Notwithstanding anything contained in section 26, if a contravention or default of the nature referred to in sub-section (2) or sub-section (6) of section 26, as the case may be, the Reserve Bank may impose on the person contravening or committing default a penalty not exceeding five lakh rupees or twice the amount involved in such contravention or default where such amount is quantifiable, whichever is more, and where such contravention or default is a continuing one, a further penalty which may extend to twenty-five thousand rupees for every day after the first during which the contravention or default continues.
(2) For the purpose of imposing penalty under sub-section (1), the Reserve Bank shall serve a notice on the defaulter requiring him to show cause why the amount specified in the notice should not be imposed as a penalty and a reasonable opportunity of being heard sha
(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973(2 of 193), any offence punishable under this Act for any contravention, not being an offence punishable with imprisonment only, or with imprisonment and also with fine, may, on receipt of an application from the person committing such contravention either before or after the institution of any proceeding, be compounded by an officer of the Reserve Bank duly authorised by it in this behalf.
(2) Where a contravention has been compounded under sub-section (1), no proceeding or further proceeding, as the case may be, shall be initiated or continued, as the case may be, against the person committing such contravention under that section, in respect of the contravention so compounded.
The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force.
(1) The penalty imposed on the defaulter by the Reserve Bank under section 30 may be recovered by issuing a notice to any person from whom any amount is due to the defaulter, by requiring Such person to deduct from the amount payable by him to the defaulter, the amount payable to the Reserve Bank by way of penalty and pay to the Reserve Bank.
(2) Save as otherwise provided in this section, every person to whom a notice is issued under this sub-section shall be bound to comply with such notice, and, in particular, where such notice it issued to a post office, bank or an insurer, it shall not be necessary for any passbook, deposit receipt, policy or any other document to be produced for the purpose of any entry, endorsement or the like being made before payment is made notwithstanding that any rule, practice or requirement to the contrary.
Nothing contained in this Act shall apply to stock exchanges or the clearing corporations of the stock exchanges.
Every officer of the Reserve Bank who has been entrusted with any power under this Act, shall be deemed to be a public servant within the meaning of section 21 of the Indian Penal Code(45 of 1860).
No suit or other legal proceedings shall lie against the Central Government, the Reserve Bank, or any officer thereof for any damage caused or likely to be caused by anything which is in good faith done or intended to be done in pursuance of this Act, any regulations, order or direction made or given thereunder.
(1) If any difficulty arises in giving effect to the provisions of this Act, the Central Government may, by order published in the Official Gazette, make such provision is not inconsistent with the provisions of this Act as appear to it to be necessary or expedient for removing the difficulty:
Provided that no order shall be made under this section after the expiry of a period of two years from the commencement of this Act.
(2) Every order made under this section shall be laid, as soon as may be after it is made, before each House of Parliament.
(1) The Reserve Bank may, by notification, make regulations consistent with this Act to carry out the provisions of this Act.
(2) In particular, and without prejudice to the generality of the foregoing provision, such regulations may provide for all or any of the following matters, namely:-
(a) the powers and functions of the Committee constituted under sub-section (2), the time and venue of its meetings and the procedure to be followed by it at its meetings (including the quorum at such meetings) under sub-section (4) of section 3;
(b) the form and manner in which an application for authorisation for commencing or carrying on a payment system shall be made and the fees which shall accompany such application under sub-section (2) of section 5;
(c) t
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