Action on KGK Finance
Case Brief
The Reserve Bank of India cancelled the Certificate of Registration of KGK Finance Limited, an NBFC with its registered office in Chennai, on 29 October 2008. The action was taken under Section 45-IA(6) of the RBI Act, 1934. As a result, KGK Finance Limited cannot transact the business of a non-banking financial institution.
The Reserve Bank of India cancelled the Certificate of Registration issued to KGK Finance Limited, whose registered office was in West Mambalam, Chennai, under Section 45-IA(6) of the Reserve Bank of India Act, 1934. The release states that the company had been registered to carry on the business of a non-banking financial institution and, following cancellation, it cannot transact that business.
Severity Assessment
Cancellation of a Certificate of Registration is a full licence cancellation, which carries severity 5.
KGK Finance Limited is barred from carrying on NBFC activities after the cancellation. The restriction directly affects the company’s ability to operate its business, while customers and counterparties can no longer treat it as authorised to conduct non-banking financial institution business.
Published as KGK Finance Limited
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