Notification Detail :
Bank’s prior approval for change in shareholding
In terms of Section 3(6) of the SARFAESI Act, 2002, every Securitisation Company /
Reconstruction Company (SC / RC) is required to obtain prior approval of the
Reserve Bank for any substantial change in its management. For the purpose of this
section, the expression “substantial change in management” means the change in
the management by way of transfer of shares or amalgamation or transfer of the
business of the company. Hence, one of the terms and conditions stipulated to the
SC/RCs, while granting them the Certificate of Registration, states that prior approval
of Reserve Bank will have to be taken by the SC/RCs for any change in their
shareholding pattern
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