J. Thomas Finance Private Limited & Anr. Vs Reserve Bank of India & Ors (Calcutta High Court)
The case before the Calcutta High Court concerned a writ petition challenging the rejection of an application for voluntary surrender of a Certificate of Registration (CoR) as a Non-Banking Financial Company (NBFC) by the Reserve Bank of India.
The petitioner, an NBFC registered in 1998, decided in 2024 to discontinue its NBFC business due to lack of commercial viability and high compliance costs. Accordingly, its Board approved surrender of the CoR and an application was filed on 18 March 2025.
Prior to this, RBI had notified the petitioner that it failed to meet the minimum Net Owned Fund (NOF) requirement of ₹5 crore, with its NOF standing at ₹2.66 crore as of 31 March 2024, and directed compliance within stipulated timelines.
Subsequently, RBI issued a notice alleging non-compliance with NOF requirements. The petitioner responded, highlighting that it had already applied for voluntary surrender and submitted relevant financial documents, including audited statements and statutory certificates.
However, the RBI rejected the surrender application on the ground that the petitioner continued to satisfy the Principal Business Criteria (PBC), i.e., financial assets and financial income each exceeding 50% thresholds as of 31 December 2024.
