The Regional Rural Banks Act, 1976

(1) This Act may be called the Regional Rural BanksAct, 1976. (2) It extends to the whole of India. (3) It shall be deemed to have come into force on the 26th day of September, 1975.

In this Act, unless the context otherwise requires,-- (a) "Board", in relation to a Regional Rural Bank, means the Board of directors of that RegionalRural Bank; (b) "Chairman", in relation to a Regional Rural Bank, means the individual appointed orre-appointed under sub-section (1) of section 11 as the Chairman of that bank; (c) "director", in relation to a Regional Rural Bank, means a member of the Board of that bank;1 [(ca) "National Bank" means the National Bank for Agriculture and Rural Developmentestablished under section 3 of the National Bank for Agriculture and Rural Development Act, 1981(61 of 1981);] (d) "notified area" means the local limits, specified under sub-section (1) of section 3, withinwhich a Regional Rural Bank shall operate; (e) "prescribed" means prescribed by rules made under this Act; (f) "Regional Rural Bank" means a Regional Rural Bank established under sub-section (1) ofsection 3; (g) "Sponsor Bank", in relation to a Regional Rural Bank, means a bank by which such RegionalRural Bank has been sponsored; (h) "State Government" means,-- (i) in relation to a Regional Rural Bank established in a Union territory, the CentralGovernment; (ii) in relation to a Regional Rural Bank established in a State, the Government of that State; (i) words and expressions used herein and not defined but defined in the Reserve Bank of IndiaAct, 1934 (2 of 1934), shall have the meanings respectively assigned to them in that Act; (j) words and expressions used herein and not defined either in this Act or in the Reserve Bank ofIndia Act, 1934 (2 of 1934), but defined in the Banking Regulation Act, 1949 (10 of 1949), shall havethe meanings respectively assigned to them in the Banking Regulation Act, 1949 (10 of 1949).

(1) The Central Government may,if requested so to do by a Sponsor Bank, by notification in the Official Gazette, establish in a State orUnion territory, one or more Regional Rural Banks with such name as may be specified in the notificationand may, by the said or subsequent notification, specify the local limits within which each Regional RuralBank shall operate. (2) Every Regional Rural Bank shall be a body corporate with perpetual succession and a commonseal with power, subject to the provisions of this Act, to acquire, hold and dispose of property and tocontract and may sue and be sued in its name. 1[(3) It shall be the duty of the Sponsor Bank to aid and assist the Regional Rural Bank, sponsored byit, by-- (a) subscribing to the share capital of such Regional Rural Bank; (b) training personnel of such Regional Rural Bank; and (c) providing such managerial and financial assistance to such Regional Rural Bank 2***, as maybe mutually agreed upon between the Sponsor Bank and the Regional Rural Bank: 3* * * * *]

(1) A Regional Rural Bank shall have its head office at such place in thenotified area as the Central Government may, after consultation with the 1[National Bank] and theSponsor Bank, specify by notification in the Official Gazette. (2) A Regional Rural Bank may, if it is of opinion that it is necessary so to do, establish its branchesor agencies at any place in the notified area.

The authorised capital of each Regional Rural Bank shall be 1[two thousandcrore of rupees, divided into two hundred crore of fully paid-up shares of ten rupees each]: Provided that the Central Government may, after consultation with the 2[National Bank] and theSponsor Bank, increase or reduce such authorised capital; so, however, that the authorised capital shallnot be reduced below 3[one crore of rupees, and the shares shall be, in all cases, fully paid-up shares often rupees each].