Pro Knits vs Board Of Directors Of Canara Bank 2024 INSC 565 – MSMED Act – Banking Regulation Act

Micro, Small and Medium Enterprises Development Act, 2006; Section 9 -“Framework for Revival and Rehabilitation of MSMEs”- The Instructions/Directions issued by the Central Government under Section 9 of the MSMED Act and by the RBI under Section 21 and Section 35A have statutory force and are binding to all the Banking companies- when it is mandatory or obligatory on the part of the Banks to follow the Instructions/Directions issued by the Central Government and the Reserve Bank of India with regard to the Framework for Revival and Rehabilitation of MSMEs, it would be equally incumbent on the part of the concerned MSMEs to be vigilant enough to follow the process laid down under the said Framework, and bring to the notice of the concerned Banks, by producing authenticated and verifiable documents/material to show its eligibility to get the benefit of the said Framework. (Para 17-18)

Banking Regulation Act, 1949; Section 21,35A- Directions issued by the Reserve Bank of India to the Banking companies are binding on them and they are bound to comply with such directions- Section 21 and Section 35A of the said Act empower the Reserve Bank of India to frame the policy and give directions to the banking companies in relation to the advances to be followed by the banking companies. Such directions have got to be read as supplement to the provisions of the Banking Regulation Act and accordingly are required to be construed as having statutory force and mandatory. (Para 9-13)

Read Judgment

Related Posts

95 thoughts on “Pro Knits vs Board Of Directors Of Canara Bank 2024 INSC 565 – MSMED Act – Banking Regulation Act”

Leave a Comment

Your email address will not be published. Required fields are marked *