Take the pledge to vote

For a better tommorow#AajSawaroApnaKal
  • I agree to receive emails from News18

  • I promise to vote in this year's elections no matter what the odds are.
  • Please check above checkbox.


Thank you for
taking the pledge

Vote responsibly as each vote counts
and makes a diffrence


Issued in public interest by HDFC Life. HDFC Life Insurance Company Limited (Formerly HDFC Standard Life Insurance Company Limited) (“HDFC Life”). CIN: L65110MH2000PLC128245, IRDAI Reg. No. 101 . The name/letters "HDFC" in the name/logo of the company belongs to Housing Development Finance Corporation Limited ("HDFC Limited") and is used by HDFC Life under an agreement entered into with HDFC Limited. ARN EU/04/19/13618
LIVE TV DownloadNews18 App
News18 English
donald trump india visit
donald trump india visit
News18 » Business
2-min read

Restrictions on Cash Withdrawal from PMC Bank Based on Ability to Pay Depositors: RBI to Delhi HC

The submissions were made in response to a PIL seeking removal of restrictions on cash withdrawals from the PMC Bank.


Updated:January 22, 2020, 12:01 AM IST
facebookTwitter Pocket whatsapp
Restrictions on Cash Withdrawal from PMC Bank Based on Ability to Pay Depositors: RBI to Delhi HC
Representative image.

New Delhi: Restrictions on cash withdrawals from the scam-hit Punjab and Maharashtra Cooperative (PMC) Bank Ltd were based on the bank's liquidity position and ability to pay its depositors, RBI told the Delhi High Court on Tuesday.

Justifying its action on putting cap on withdrawals, Reserve Bank of India (RBI) said restrictions were placed due to liquidity and solvency issues but that does not "extinguish the liability" of the bank towards the depositors.

"The steps taken by RBI are not arbitrary in nature. Directions under Section 35A of the Banking Regulation Act 1949 (AACS) were issued in view of the large scale irregularities and wrong doings committed by the bank to prevent further deterioration of the bank's financials and also aim at protecting the interest of depositors," RBI said.

The submissions were made in response to a PIL seeking removal of restrictions on cash withdrawals from the PMC Bank.

The central bank further said that the move to restrict payment of deposits was based on available liquidity to prevent any discretionary and discriminatory payment to the small body of depositors.

Seeking dismissal of the plea, it told the court that all concerned authorities are working in close co-ordination for speedy resolution of this crisis and therefore no intervention from this court is desired at this juncture.

The RBI said is has not violated any fundamental rights of the petitioners and directions for invoking Article 226 of the Constitution of India against RBI and the petition was not maintainable.

The PMC Bank has been put under restrictions by the RBI, following the unearthing of a Rs 4,355-crore scam.

Cash withdrawals have been capped by the RBI at Rs 40,000 for a six-month period, causing panic and distress among the bank's customers, petitioner Bejon Kumar Misra had said in his plea.

In the petition, Misra had sought quashing of the RBI notifications by which the restrictions were placed on cash withdrawals from the bank.

He has also said a full insurance coverage of the depositors' money was the need of the hour, "considering the reoccurrence of financial scams in co-operative and nationalised banks".

The plea was first moved by Misra in the Supreme Court, which refused to entertain it last month and asked him to approach the high court.

Subsequently, he filed the petition in the Delhi High Court.

The petition has sought directions to the Centre and the RBI for constituting a high-powered committee to look into the working and operations of all cooperative banks "in order to have a robust and transparent mechanism, which can inspire confidence of the public in cooperative banks".

Get the best of News18 delivered to your inbox - subscribe to News18 Daybreak. Follow News18.com on Twitter, Instagram, Facebook, Telegram, TikTok and on YouTube, and stay in the know with what's happening in the world around you – in real time.

Read full article
Next Story
Next Story

facebookTwitter Pocket whatsapp
Most Active
Company Price Change %Gain
Reliance 1,485.50 -1.24
IRCTC 1,927.75 5.30
Indiabulls Hsg 338.30 10.81
Tata Chemicals 764.50 -0.08
HDFC Life 573.75 -0.93
Top Gainers
Company Price Change %Gain
IndusInd Bank 1,181.75 3.57
Tata Steel 443.70 2.48
SBI 327.65 2.31
ONGC 102.85 1.13
Power Grid Corp 189.35 1.01
Top Losers
Company Price Change %Gain
Asian Paints 1,842.85 -2.30
HUL 2,247.85 -1.99
TCS 2,156.30 -1.75
Nestle 16,544.10 -1.38
Tech Mahindra 829.55 -1.36

Live TV

Countdown To Elections Results
To Assembly Elections 2018 Results