45-IC. Reserve fund.-
(1) Every non-banking financial company shall create
a reserve fund and transfer therein a sum not less than twenty
per cent of its net profit every year as disclosed in the
profit and loss account and before any dividend is declared.
(2) No appropriation of any sum from the reserve fund shall
be made by the non-banking financial company except for the
purpose as may be specified by the Bank from time to time
and every such appropriation shall be reported to the Bank
within twenty-one days from the date of such withdrawal:
Provided that the Bank may, in any particular case and for
sufficient cause being shown, extend the period of twenty-one
days by such further period as it thinks fit or condone any
delay in making such report.
(3) Notwithstanding anything contained in sub-section (1),
the Central Government may, on the recommendation of the Bank
and having regard to the adequacy of the paid-up capital and
reserves of a non-banking financial company in relation to
its deposit liabilities, declare by order in writing that
the provisions of sub-section (1) shall not be applicable
to the non-banking financial company for such period as may
be specified in the order:
Provided that no such order shall be made unless the amount
in the reserve fund under sub-section (1) together with the
amount in the share premium account is not less than the paid-up
capital of the non-banking financial company.
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