Section 12B(3) in The Securitisation And Reconstruction Of Financial Assets And Enforcement Of Security Interest Act, 2002
(3)Where on audit or inspection or otherwise, the Reserve Bank is satisfied that business of an asset reconstruction company is being conducted in a manner detrimental to public interest or to the interests of investors in security receipts issued by such asset reconstruction company, the Reserve Bank may, for securing proper management of an asset reconstruction company, by an order-(a)remove the Chairman or any director or appoint additional directors on the board of directors of the asset reconstruction company; or(b)appoint any of its officers as an observer to observe the working of the board of directors of such asset reconstruction company:Provided that no order for removal of Chairman or director under clause (a) shall be made except after giving him an opportunity of being heard.
