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Section 56 of the Banking Regulation Act, 1949 plays a specific bridging role with respect to co-operative societies engaged in banking. What does Section 56 do?
Answer & Solution
Correct answer: A.
1. The lesson identifies the constitutional duality of jurisdiction over co-op banks.
2. Section 56 of the BR Act, 1949 makes the Act applicable to co-operative societies involved in the business of banking.
3. This brings co-operative banks within RBI's regulatory ambit on banking matters.
4. Exemption from regulation, currency-issue powers and SEBI-transfer are not what Section 56 does.
_Source: ICSI CS Executive Paper 7 (Economic, Business and Commercial Laws) — Lesson 1: Reserve Bank of India Act, 1934, pp. 8-21._
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