of the Companies Act; 1956 (1 of 1956), the contents of the report which he has — THE RESERVE BANK OF INDIA ACT, 1934

section 227 of the Companies Act; 1956 (1 of 1956), the contents of the report which he has made or intends to make, to the Bank:] 2[(3) Where the bank is of the opinion that it is necessary So to do in the public interest O in the interest of the non-banking financial company Or in the interest of depositors of such company it may at any time by order direct that special audit of the accounts of the non-banking financial company in relation to any such transaction O class of transactions O for such period 0T periods, as may be specified in the order, shall be conducted and the Bank may appoint an auditor or auditors to conduct such special audit and direct the auditor or the auditors to submit the report to it. The remuneration of the auditors as may be fixed by the Bank, having regard to the nature and volume of work involved in the audit and the expenses of or incidental to the audit, shall be borne by the non-banking financial company so audited:] 4[4SMAA. Power to take action against auditors Where any auditor fails to comply with any direction given o order made by the Bank under section 4SMA, the Bank, may, if satisfied, remove Or debar the auditor from exercising the duties as auditor of any of the Bank regulated entities for maximum period of three years, at a time:] S[4SMB Power of Bank to prohibit acceptance of deposit and alienation of assets. (1) If any non-banking financial company violates the provisions of any section or fails to comply with any direction O order given by the Bank under any of the provisions of this Chapter, the Bank may prohibit the non-banking financial company from accepting any deposit. (2) Notwithstanding anything to the contrary contained in any agreement Or instruments 0 any law for the time being in force, the Bank, on being satisfied that it is necessary $o to do in the public interest or in the interest of the depositors, may direct; the non-banking financial company against which an order prohibiting from accepting deposit has been issued, not to sell, transfer, create charge O mortgage O deal 1. Ins. by Act 51 of 1974, s_ 19 (w.e.f: 13-12-1974) 2. Ins. by Act 23 of 1997, 5 (w.e.f: 9-1-1997) 3 . Subs by $_ 5,ibid , for non-banking institution, being a company" (W.e.f: 9-1-1997). 4. Ins. by Act 23 of 2019,s. 139 (W.e.f: 9-8-2019) 5 Ins. by Act 23 of 1997 s. 6. (w.e.f: 9-1-1997). 46 in any manner with its property and assets without prior written permission of the Bank for such period not exceeding six months from the date of the order: [ASMBA. Resolution of non-banking financial company: Without prejudice to any other provision of this Act O any other law for the time being in force, the Bank may, if it is satisfied, upon an inspection of the Books of a non-banking financial company that it is in the public interest O in the interest of financial stability SO to do for enabling the continuance of the activities critical to the functioning of the financial system, frame schemes which may provide for ay one or more of the following, namely: amalgamation with any other non-banking institution; reconstruction of the non-banking financial company; splitting the non-banking financial company into different units Or institutions and vesting viable and non-viable businesses in separate units O institutions to preserve the continuity of the activities of that non-banking financial company that are critical to the functioning of the financial system and for such purpose establish institutions called 'Bridge Institutions' Explanation. For the purposes of this sub-section, Bridge Institutions" mean temporary institutional arrangement made under the scheme referred to in this sub-section, to preserve the continuity of the activities of non-banking financial company that are critical to the functioning of the financial system: (2) Without prejudice to the generality of the foregoing provisions, the scheme referred to in sub-section (1) may provide for reduction of the pay and allowances of the chief executive officer, managing director, chairman Or any officer in the senior management of the non-banking financial company; cancellation of all 0 some of the shares of the non-banking financial company held by the chief executive officer, managing director, chairman O any officer in the senior management of the non-banking financial company Or their relatives; sale of any of the assets of the non-banking financial company. 3) The chief executive officer, managing director, chairman Or any officer in the senior management of the non-banking financial company whose pay and allowances are reduced 0r the shareholders whose shares are cancelled under the scheme shall not be entitled to any compensation:] ASMC. Power of Bank to file winding up petition:-(1) The Bank, o being satisfied that a non- banking financial company (a) is unable to pay its debt; or (b) has by virtue of the provisions of

Section Section 227