Recently a person named Mr. Pandurang had made an application to RBI for a few questions relating to signing of CMA report by CA with UDIN and certifying KYC details or certifying ITR for banks for loan purposes and whether RBI has any specific policy or notification for same and RBI’s response to same is as under:
|1||Signing on Project Report for Loan Purposes with seal/UDIN of CA thereon. I wish to ask Reserve Bank of India if there is specific circular/notification issued by them to the commercial banks demanding signing on Project Reports/CMA Report by CAs while advancing New/ Old Loans.||We have not issued any specific instructions in this regard.
However, it may be noted that credit related issues are mostly deregulated. The Reserve Bank of India has advised banks to have documents of investment policy, loan policy, loan recovery policy etc. prepared and duly vetted by their Boards of Directors. Banks are required to take credit related decisions based on Board approved policies subject to the instructions contained in our Master Circular on “Loans and Advances – Statutory and Other Restrictions” issued vide DBR. No.Dir.BC.10/13.03.00/2015-16 dated July 1, 2015 which is available on our website www.rbi.org.in under the head ‘Notifications’.
|2||Giving certification/ Signing on Unaudited balance sheets and on Income Tax Returns of Clients (for those who dont fall under category of Audit Cases such as Income Tax, Company Act etc) & generating UDIN thereon. I wish to ask Reserve Bank of India if there is specific circular/notification issued by them to all the commercials banks.|
|3||I wish to ask any policy drafted by RBI with such Banks to get Certificate of Know you customer by CA if client is known to him and validity of the same.||We have not issued any specific instructions in this regard.|
|4||Utilisation Certificate from CAs. Few banks before sanctioning of loan demand CA certificate about stating facts that client will not utilise the loan for any unlawful/ illegal/ terrorists activities. I wish to know how CA can give such certificate for loan benefits enjoyed by client and validity of the same. I wish to ask Reserve Bank of India if there is specific circular/notification issued by them to all the commercials banks.
All above matters are dealt by the concerned bankers with their own/ potential customers for their respective benefits. I wish to know how come a Professional Chartered Accountant comes into the picture to certify/ validate for the acts performed by independent parties.
In connections to this I urge you to please look into this matter on urgent basis and act to issue reply and on my queries which will impact the large community of professionals like us.
|What is being sought is not information in terms of Section 2 (f) of RTI Act, 2005.
However, you may refer to query 1 and 2 above
Thus, with the above response RBI has clarified that it has never issued any such notification or circular for getting certificates from Chartered Accountants and any such requirements by commercial banks are just internal policy of bank made by it’s board.
However, even after such clarification a CA will have to sign such documents if they want to get loan for their client as it is the requirement of the financial institution providing the loan.
To read about RBI on RTI policy CLICK HERE.