Banking Regulation Act, 1949 · Section guide
Section 36AD: Punishments for certain activities in relation to banking companies
Reviewed by CA Nikhil Gupta · Last reviewed 18 September 2026
Section 36AD protects the ability of banking institutions to function without obstruction or conduct calculated to undermine depositor confidence. It prohibits obstruction of lawful entry, exit or business; violent or business-disruptive demonstrations within bank premises; and conduct calculated to undermine depositor confidence. Contravention without reasonable excuse is punishable. For this section, the expression “banking company” is statutorily extended to specified banking and development institutions; Section 56 modifies its application to co-operative banks.
Official statute linkedProvision-specific anatomyPractical case + evidence file
Statutory structure and clause/subsection decode
Section 36AD(1)(a)
No person may obstruct lawful entry to or exit from a banking office/place of business, or obstruct the carrying on of business there.
Section 36AD(1)(b)
No person may hold within a banking office/place of business a violent demonstration or one that prevents, or is calculated to prevent, normal banking business.
Section 36AD(1)(c)
No person may act in a manner calculated to undermine depositors’ confidence in the banking company.
Section 36AD(2)
Contravention of subsection (1) without reasonable excuse is punishable with imprisonment up to six months, fine up to ₹1,000, or both, under the consolidated text.
Section 36AD(3) and Section 56
For this section “banking company” includes the additional institutions listed in subsection (3). Under Section 56, subsection (3) is omitted for co-operative-bank application, so the co-operative adaptation must be read separately.
Practical example
During business hours, a group blocks customers from entering a bank branch and stages a violent demonstration inside the premises that prevents normal transactions. Section 36AD(1)(a) and (b) are directly engaged. If there is no reasonable excuse, subsection (2) supplies the statutory punishment. The analysis is about obstruction, disruptive demonstrations and depositor confidence—not removal of bank property or records.
Evidence / working-paper checklist
- Section 36AD evidence: RBI/Central Government order or scheme.
- Section 36AD evidence: service/hearing record and reasons.
- Section 36AD evidence: board/management handover or acquisition documents.
- Section 36AD evidence: consequential appointment, compensation or tribunal records.
Retain the event date and source version with the file so the conclusion remains reproducible after later amendments.
Common mistakes to avoid
- For Section 36AD, avoid treating an intervention power as an ordinary governance power.
- For Section 36AD, avoid missing the opportunity/hearing or service step specified by the Act.
- For Section 36AD, avoid failing to implement the consequential disqualification/vesting/management effects.
Related sections inside the Act
Use these links to read Section 36AD in its statutory sequence, especially where the provision imports definitions, approvals, appeals, penalties or winding-up consequences from neighbouring sections.
Current-law source control
Source control: Section 36AD is anchored to the official DFS consolidated text; later changes require separate Gazette verification.
Dated matters: verify any later Gazette, RBI direction or binding judgment affecting Section 36AD on the event date.
Section 36AD Q&A
What conduct does Section 36AD prohibit?
Obstruction of lawful access or business, violent or business-disruptive demonstrations within banking premises, and conduct calculated to undermine depositors’ confidence.
Is every protest near a bank an offence under Section 36AD?
No. The statutory text targets the specified conduct in subsection (1), and subsection (2) also refers to contravention without reasonable excuse.
Does Section 36AD deal with removal of bank property or records?
No. That description does not state the operative prohibitions in Section 36AD.
Does Section 36AD apply identically to co-operative banks?
Section 56 modifies the co-operative-bank application, including omission of subsection (3); the Section 56 adaptation must therefore be checked.
Primary official sources
Disclaimer
This Finin2min page is an educational and professional reference. Banking regulation is fact-, entity- and date-sensitive. Verify the current Act, Gazette amendments and commencement notifications, applicable RBI Rules/directions and the transaction record before acting or filing.