RBI imposes monetary penalty on Bahadur Chand Investments Private Limited, New Delhi
The Reserve Bank of India (RBI) has, by an order dated January 06, 2023, imposed a monetary penalty of ₹30.00 lakh (Rupees Thirty lakh only) on Bahadur Chand Investments Private Limited, New Delhi (the company) for non-compliance with certain provisions of the “Core Investment Companies (Reserve Bank) Directions, 2016” and directions on “Information Technology Framework for the NBFC Sector”. This penalty has been imposed in exercise of powers vested in RBI under the provisions of clause (b) of sub-section (1) of section 58 G read with clause (aa) of sub-section (5) of section 58 B of the Reserve Bank of India Act, 1934.
This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the company with its customers.
The statutory inspection of the company was conducted by RBI with reference to its financial position as on March 31, 2021 and examination of the Risk Assessment Report, Inspection Report, supervisory letter and all related correspondence pertaining to the same revealed, inter alia, the company’s failure to (i) comply with the RBI directions on outsourcing, (ii) appoint an Independent Director/Chief Information Officer (CIO)/Chief Technology Officer (CTO) on IT Strategy Committee and (iii) disclose components of Adjusted Net Worth (ANW) and other related information in its annual financial statements for the position as on March 31, 2021. In furtherance to the same, a notice was issued to the company advising it to show cause as to why penalty should not be imposed on it for failure to comply with the RBI directions, as stated therein.
After considering the company’s reply to the notice, examination of additional submissions made by it and oral submissions made during the personal hearing, RBI came to the conclusion that the charge of non-compliance with the aforesaid RBI directions was substantiated and warranted imposition of monetary penalty.