What are the provision of RBI Act 1934 regarding negotiable instrument?

(1) ] No person in 2[India] other than the Bank, or, as expressly authorized by this Act the 3[Central Government] shall draw, accept, make or issue any bill of exchange, hundi, promissory note or engagement for the payment of money payable to bearer on demand, or borrow, owe or take up any sum or sums of money on the …

WHO issues promissory note payable to bearer?

the Central Government
[(2) Notwithstanding anything contained in the Negotiable Instruments Act, 1881, (26 of 1881) no person in 190[India] other than the Bank or, as expressly authorised by this Act, the Central Government shall make or issue any promissory note expressed to be payable to the bearer of the instrument.]

What is the penalty when a person starts payment system without RBI permission?

According to the framework issued by RBI, payments systems and banks can be told to fork out penalties between Rs5 lakh and Rs1 crore. Under the Act, no person can operate a payment system without RBI authorization. Only stock exchanges are exempt from obtaining such authorization.

What is the legal basis of RBI’s powers?

The Act imparts RBI with many powers that include the license to control and regulate the voting rights of the shareholders, supervising the appointment process of the management and abroad, giving license to banks, imposing penalties and so on. The Reserve Bank regulates and supervises the nation’s financial system.

Which section of the RBI Act 1934 deals with business which the Bank may transact?

Section 17. Business which the Bank may transact. Section 18. Power of direct discount.

How many sections are there in RBI Act 1934?

The act provides for the Constitution management and functions of the RBI. It also empowers it to exercise control and regulations, over the Commercial Banks, the non-banking finance companies and the financial institutions. The Act is divided into 61 Sections and four schedules.

Do Promissory Notes expire?

Under California law, written agreements are generally covered by a 4-year statute of limitations. The statue of limitations expires 6 years from the due date. Often a promissory note is due “on-demand”. If that’s the case the statute of limitations expires 6 years after the demand.

Who is primarily responsible for Promissory Notes?

Answer is “Maker”

What is payment and Settlement Act?

The Payment and Settlement Systems Act, 2007. Long Title: An Act to provide for the regulation and supervision of payment systems in India and to designate the Reserve Bank of India as the authority for that purpose and for matters connected therewith or incidental thereto.

What is Section 25 settlement and act?

(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 …

What does RBI Act envisage?

The Preamble to the Reserve Bank of India Act, 1934 (the Act), under which it was constituted, specifies its objective as “to regulate the issue of Bank notes and the keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its …

What is the legal status of RBI?

The RBI was originally set up as a private entity, but it was nationalized in 1949. The reserve bank is governed by a central board of directors appointed by the national government.