RBI ALLOWS BANKS FOR REMITTANCE OUT OF ASSETS

The Reserve Bank of India (RBI) has allowed banks to permit remittance out of assets of Indian companies under liquidation under the provisions of the Companies Act, 1956. Banks will have to ensure that the remittance is in compliance with the order issued by a court in India and order issued by the official liquidator or the liquidator in the case of voluntary winding up. In case of winding up otherwise than by a court, a bank will have to obtain an auditor’s certificate to the effect that there is no legal proceedings pending in any court in India against the applicant or the company under liquidation and there is no legal impediment in permitting the remittance.