Section 17(4) in The Reserve Bank of India Act, 1934
(4)the making to local authorities, scheduled banks, State co-operative banks and State Financial Corporations or loans and advances, repayable on demand or on the expiry of fixed periods not exceeding ninety days, against the security of—(a)stocks, funds and securities (other than immovable property) in which a trustee is authorized to invest trust money by any Act of Parliament of the United Kingdom or by any law for time being in force in India ;(b)gold or silver or documents of title to the same;(c)such bills of exchange and promissory notes as are eligible for purchase or rediscount by the Bank or as are fully guaranteed as to the repayment of the principal and payment of interest by a State Government;(d)promissory notes of any scheduled bank or State co-operative bank, supported by documents of title to goods such documents having been transferred, assigned, or pledged to any such bank as security for a loan or advance made for bona fide commercial or trade transactions, or for the purpose of financing agricultural operations or the marketing of crops:Provided that loans and advances made against the security of bills of exchange and promissory notes arising out of any transaction relating to the export of goods from India shall be repayable on demand or on the expiry of fixed periods not exceeding one hundred and eighty days;
