Section 45: Power of Reserve Bank to apply to Central Government for suspension of business by a banking company and to prepare scheme of reconstitution or amalgamation.

Q: What does Section 45 of The Banking Regulation Act, 1949 (BR Act) deal with?

Section 45 BR Act pertains to "Power of Reserve Bank to apply to Central Government for suspension of business by a banking company and to prepare scheme of reconstitution or amalgamation.". It is part of the The Banking Regulation Act, 1949, a legislation enacted by the Parliament of India. Section 45 of The Banking Regulation Act, 1949 (BR Act) governs power of Reserve Bank to apply to Central Government for suspension of business by a banking company and to prepare scheme of reconstitution or amalgamation. As verified on 22 May 2026.

Q: Is Section 45 BR Act still in force?

Yes, Section 45 of the The Banking Regulation Act, 1949 is currently in force across the Republic of India.

Q: What is धारा 45 BR Act?

धारा 45 BR Act is the Devanagari Hindi reference for Section 45 of the The Banking Regulation Act, 1949. Section 45 of The Banking Regulation Act, 1949 (BR Act) governs power of Reserve Bank to apply to Central Government for suspension of business by a banking company and to prepare scheme of reconstitution or amalgamation. As verified on 22 May 2026.

Q: What is Dhara 45 BR Act?

Dhara 45 BR Act is the Roman Hindi reference for Section 45 of the The Banking Regulation Act, 1949. "Dhara" means "Section" in Hindi. Section 45 of The Banking Regulation Act, 1949 (BR Act) governs power of Reserve Bank to apply to Central Government for suspension of business by a banking company and to prepare scheme of reconstitution or amalgamation. As verified on 22 May 2026.

Q: How to cite Section 45 of The Banking Regulation Act, 1949?

Cite as: "Section 45, The Banking Regulation Act, 1949 (BR Act)" in legal briefs. For academic writing, use the BlueBook format: The Banking Regulation Act, 1949, 1949, § 45 (India).

Law on Tips Editorial Board

1[45. Power of Reserve Bank to apply to Central Government for suspension of business by a banking company and to prepare scheme of reconstitution or amalgamation.—(1) Notwithstanding anything contained in the foregoing provisions of this Part or in any other law or 2[any 2[any agreement or other instrument], for the time being in force, where it appears to the Reserve Bank that there is good reason so to do, the Reserve Bank may apply to the Central Government for an order of moratorium in respect of 3[a banking company].

(2) The Central Government, after considering the application made by the Reserve Bank under sub-section (1), may make an order of moratorium staying the commencement or continuance of all actions and proceedings against the company for a fixed period of time on such terms and conditions as it thinks fit and proper and may from time to time extend the period so however that the total period of moratorium shall not exceed six months.

(3) Except as otherwise provided by any directions given by the Central Government in the order made by it under sub-section (2) or at any time thereafter, the banking company shall not during the period of moratorium make any payment to any depositors or discharge any liabilities or obligations to any other creditors.

4[(4) During the period of moratorium, if the Reserve Bank is satisfied that—

it is necessary so to do, the Reserve Bank may prepare a scheme—

(5) The scheme aforesaid may contain provisions for all or any of the following matters, namely:—

Provided that the scheme shall contain a provision that—

Provided further that if in any case under clause (ii) of the first proviso any doubt or difference arises as to whether the qualification and experience of any of the said employees are the same as or equivalent to the qualifications and experience of the other employees of corresponding rank or status of the transferee bank, 6[the doubt or difference shall be referred, before the expiry of a period of three years from the date of the payment or grant mentioned in that clause,] to the Reserve Bank whose decision thereon shall be final;

(6) (a) A copy of the scheme prepared by the Reserve Bank shall be sent in draft to the banking company and also to the transferee bank and any other banking company concerned in the amalgamation, for suggestions and objections, if any, within such period as the Reserve Bank may specify for this purpose.

(7) The scheme shall thereafter be placed before the Central Government for its sanction and the Central Government may sanction the scheme without any modifications or with such modifications as it may consider necessary; and the scheme as sanctioned by the Central Government shall come into force on such date as the Central Government may specify in this behalf:

Provided that different dates may be specified for different provisions of the scheme.

7[(7A) The sanction accorded by the Central Government under sub-section (7), whether before or after the commencement of section 21 of the Banking Laws (Miscellaneous Provisions) Act, 1963 (55 of 1963), shall be conclusive evidence that all the requirements of this section relating to reconstruction, or, as the case may be, amalgamation have been complied with and a copy of the sanctioned scheme certified in writing by an officer of the Central Government to be a true copy thereof, shall, in all legal proceedings (whether in appeal or otherwise and whether instituted before or after the commencement of the said section 21), be admitted as evidence to the same extent as the original scheme.]

(8) On and from the date of the coming into operation of the scheme or any provision thereof, the scheme or such provision shall be binding on the banking company or, as the case may be, on the transferee bank and any other banking company concerned in the amalgamation and also on all the members, depositors and other creditors and employees of each of those companies and of the transferee bank, and on any other person having any right or liability in relation to any of those companies or the transferee bank 8[including the trustees or other persons managing, or connected in any other manner with, any provident fund or other fund maintained by any of those companies or the transferee bank.]

(9) 9[On and from the date of the coming into operation of, or as the case may be, the date specified in this behalf in the scheme] the properties and assets of the banking company shall, by virtue of and to the extent provided in the scheme, stand transferred to, and vest in, and the liabilities of the banking company shall, by virtue of and to the extent provided in the scheme, stand transferred to, and become the liabilities of the transferee bank.

(10) If any difficulty arises in giving effect to the provisions of the scheme, the Central Government may by order do anything not inconsistent with such provisions which appears to it necessary or expedient for the purpose of removing the difficulty.

(11) Copies of the scheme or of any order made under sub-section (10) shall be laid before both Houses of Parliament, as soon as may be, after the scheme has been sanctioned by the Central Government, or, as the case may be, the order has been made.

(12) Where the scheme is a scheme for amalgamation of the banking company, any business acquired by the transferee bank under the scheme or under any provision thereof shall, after the coming into operation of the scheme or such provision, be carried on by the transferee bank in accordance with the law governing the transferee bank, subject to such modifications in that law or such exemptions of the transferee bank from the operation of any provisions thereof as the Central Government on the recommendation of the Reserve Bank may, by notification in the Official Gazette, make for the purpose of giving full effect to the scheme:

Provided that no such modification or exemption shall be made so as to have effect for a period of more than seven years from the date of the acquisition of such business.

(13) Nothing in this section shall be deemed to prevent the amalgamation with a banking institution by a single scheme of several banking companies in respect of each of which an order of moratorium has been made under this section.

(14) The provisions of this section and of any scheme made under it shall have effect notwithstanding anything to the contrary contained in any other provisions of this Act or in any other law or any agreement, award or other instrument for the time being in force.

(15) In this section, "banking institution " means any banking company and includes the State Bank of India or 9[a subsidiary bank or a corresponding new bank].

8[Explanation.—References in this section to the terms and conditions of service of as applicable to an employee shall not be construed as extending to the rank and status of such employee.]1 Ins. by Act 37 of 1960, s. 6 (w.e.f. 19-9-1960). 2 Subs. by Act 7 of 1961, s. 4, for "any agreement " (w.e.f. 24-3-1961). 3 Subs. by s. 4, ibid., for "the banking company "(w.e.f. 24-3-1961). 4 Subs. by s. 4, ibid., for sub-sections (4) to (9) (w.e.f. 24-3-1961). 5 Subs. by Act 1 of 1984, s. 34, for "as are applicable " (w.e.f. 15-2-1984). 6 Subs. by Act 11 of 1984, s. 34, for "the doubt or difference shall be referred " (w.e.f. 15-2-1984). 7 Ins. by Act 55 of 1963, s. 21 (w.e.f. 1-2-1964). 8 Ins. by Act 1 of 1984, s. 34 (w.e.f. 15-2-1984). 9 Subs. by s. 34, ibid., for certain words (w.e.f 15-2-1984).