Scribd Logo
Upload

Welcome to Scribd!

  • 16 views

    Overview of RBI Act 1934 - Taxguru - in

    Uploaded by

    ritikaagr292
    The Reserve Bank of India Act of 1934 establishes the central bank of India and outlines its objectives, functions, and powers. It defines the RBI's role in monetary policy, banking regulation, currency management, and its relationship to the government. The Act establishes the RBI's constitution and grants it authority to regulate banks, implement monetary policy tools, issue currency, and enforce compliance through penalties. It has been amended over time to strengthen the RBI's regulatory role and address changes in India's financial system.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Overview of RBI Act 1934 - Taxguru - in

    Uploaded by

    ritikaagr292
    16 views2 pages
    The Reserve Bank of India Act of 1934 establishes the central bank of India and outlines its objectives, functions, and powers. It defines the RBI's role in monetary policy, banking regulation, currency management, and its relationship to the government. The Act establishes the RBI's constitution and grants it authority to regulate banks, implement monetary policy tools, issue currency, and enforce compliance through penalties. It has been amended over time to strengthen the RBI's regulatory role and address changes in India's financial system.

    Original Title

    Overview of RBI Act 1934- Taxguru.in

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    The Reserve Bank of India Act of 1934 establishes the central bank of India and outlines its objectives, functions, and powers. It defines the RBI's role in monetary policy, banking regulation, currency management, and its relationship to the government. The Act establishes the RBI's constitution and grants it authority to regulate banks, implement monetary policy tools, issue currency, and enforce compliance through penalties. It has been amended over time to strengthen the RBI's regulatory role and address changes in India's financial system.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    16 views2 pages

    Overview of RBI Act 1934 - Taxguru - in

    Uploaded by

    ritikaagr292
    The Reserve Bank of India Act of 1934 establishes the central bank of India and outlines its objectives, functions, and powers. It defines the RBI's role in monetary policy, banking regulation, currency management, and its relationship to the government. The Act establishes the RBI's constitution and grants it authority to regulate banks, implement monetary policy tools, issue currency, and enforce compliance through penalties. It has been amended over time to strengthen the RBI's regulatory role and address changes in India's financial system.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 2

    OVERVIEW OF RBI ACT 1934

    AUTHOR :CS VIKRAM SIROHI

    https://taxguru.in/rbi/overview-rbi-act-1934.html

    The Reserve Bank of India Act, 1934 is the primary legislation that establishes the framework and governing
    principles for the Reserve Bank of India (RBI), the central bank of India. The Act outlines the functions, powers,
    and responsibilities of the RBI, as well as its relationship with the government and the banking system. Here is
    an overview of the RBI Act, 1934:

    1. Establishment and Constitution: The RBI Act, 1934 establishes the Reserve Bank of India as the
    central banking institution of the country. It defines the composition and structure of the RBI, including
    the appointment and tenure of the Governor, Deputy Governors, and Central Board members.

    2. Objectives and Functions: The Act outlines the main objectives and functions of the RBI. The primary
    objectives of the RBI include maintaining price stability, ensuring the stability and soundness of the
    financial system, and promoting the growth of the Indian economy. The Act empowers the RBI to
    undertake various functions, such as issuing currency, managing foreign exchange reserves, formulating
    monetary policy, regulating and supervising banks and financial institutions, and acting as the banker to
    the government.

    3. Monetary Policy: The Act grants the RBI the authority to formulate and implement monetary policy in
    India. It specifies the mechanisms for the RBI to control the supply of money, regulate interest rates, and
    manage liquidity in the banking system. The Act empowers the RBI to set certain monetary policy tools,
    such as the repo rate, reverse repo rate, and cash reserve ratio, to achieve its monetary policy objectives.

    4. Banking Regulation and Supervision: The RBI Act, 1934 provides the RBI with regulatory and
    supervisory powers over banks and financial institutions in India. The Act grants the RBI authority to
    issue guidelines, regulations, and directions to banks and financial institutions to maintain their solvency,
    liquidity, and stability. It also provides provisions for the inspection, investigation, and resolution of
    banking entities in distress.

    5. Currency Issuance and Management: The Act authorizes the RBI to issue and manage the currency
    in India. It specifies the RBI’s responsibility for the production, distribution, and maintenance of currency
    notes and coins. The Act also confers the RBI with the power to demonetize or withdraw certain
    denominations of currency notes as deemed necessary.

    6. Government and RBI Relationship: The Act defines the relationship between the RBI and the Indian
    government. It outlines the consultations and coordination mechanisms between the RBI and the
    government regarding monetary policy, exchange rate management, and other important matters. The Act
    also specifies the RBI’s role as the banker to the government and its responsibilities in managing the
    government’s accounts and transactions.
    7. Enforcement and Penalties: The RBI Act, 1934 provides provisions for enforcement, penalties, and
    legal consequences for non-compliance with the Act’s provisions. It outlines the powers of the RBI in
    imposing penalties, issuing directions, and taking legal action against entities that violate the Act or fail to
    comply with the RBI’s regulations and directions.

    The RBI Act, 1934 has undergone several amendments over the years to align with the changing economic and
    financial landscape of India. These amendments have strengthened the regulatory and supervisory framework of
    the RBI and expanded its mandate to address emerging challenges in the financial sector.

    You might also like