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Issues: Whether the orders cancelling the certificate of registration and rejecting the appeal were liable to be set aside and the matter remitted for reconsideration in light of the petitioner's subsequent compliance with the net owned fund requirement.
Analysis: The petition concerned cancellation of the petitioner's certificate of registration as an NBFC under Section 45-IA of the Reserve Bank of India Act, 1934. The petitioner's case was that although there had been a temporary shortfall in net owned funds, the requirement stood satisfied thereafter. The matter was treated as similar to earlier decisions of the Court in comparable NBFC cancellation matters, where remand for fresh consideration was found appropriate. In that setting, the impugned orders were set aside and the authority was directed to reconsider the matter afresh in accordance with the current legal position and the Court's judgments.
Conclusion: The cancellation and appellate orders were set aside and the matter was remanded to RBI for fresh consideration; the petitioner succeeded.
Ratio Decidendi: Where cancellation of an NBFC registration is challenged on the basis of subsequent compliance with the prescribed net owned fund requirement, and similar matters have been remitted for reconsideration, the appropriate course may be to set aside the impugned orders and require fresh decision-making by the regulator.
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