When the RBI can remove managerial and other persons from the services of the Bank ?

As a measure of control over management and other persons of a banking company, Section 36AA of the Banking Regulation Act confers powers to RBI, to remove managerial and other persons from office, under certain circumstances. If the RBI is satisfied that in the public interest or in the overall interest of the banking company as well as to protect the interests of depositors it is necessary to remove a managerial person, it can remove by a written order with effect from any specified date any Chairman, Director, Chief Executive Officer (by whatever name called) or other officer or employee of the banking company. Before removal, such persons who are being removed would be given a reasonable opportunity to make a presentation to RBI, against the said order. Pending the consideration of the representation from persons facing removal, in the opinion of RBI any delay in the interim would harm the interests of the bank or its depositors, order such persons not to take part either directly or indirectly in the management of, the banking company. Persons who are facing an order of removal from RBI, within thirty days from the date of communication of the order, can appeal to the Central Government against the order. After considering the appeal, the Central government may take a decision and communicate the same to the concerned persons who have made the appeal and its decision would be final in the matter. The decision of the Central Government cannot be questioned in any Court. Such persons who are facing removal order from RBI, cease to be whole-time Chairman, Managing Director or Director or any other employees as the case may be of the banking company and cannot directly or indirectly, be concerned with or take part in the management of, any banking company for period not exceeding five years. On the removal of a person from office under this section, that person shall not be entitled to claim any compensation for the loss or termination of office.