Chapter II — Incorporation, Capital, Management and Business

Section 12: Casual vacancies and absences

Reviewed by CA Nikhil Gupta · Last reviewed 18 September 2026

Section 12 provides continuity mechanisms when the Governor/Deputy Governor is temporarily unable to act and for casual vacancies in the Central Board or Local Boards.

Operative provisionOfficial sources mappedProvision-specific decode

Finin2min - Section 12 in 2 minutes

Legal effectSection 12 provides continuity mechanisms when the Governor/Deputy Governor is temporarily unable to act and for casual vacancies in the Central Board or Local Boards.

Operative ruleIt permits temporary officiating arrangements and specifies how casual vacancies are filled; a person filling a casual vacancy generally holds office for the unexpired portion of the predecessor's term.

Connected lawThe section is about continuity, not creation of a fresh full term. Appointment authority differs depending on the office concerned.

File evidenceFor appointment files, state whether the situation is temporary incapacity/absence or a true casual vacancy, because the legal route is different.

Statutory structure and clause / subsection decode

This map separates the operative limbs of this provision so thresholds, powers, conditions and exceptions are not collapsed into a single summary.

Rule 1

It permits temporary officiating arrangements and specifies how casual vacancies are filled

Rule 2

a person filling a casual vacancy generally holds office for the unexpired portion of the predecessor's term.

Connected rule

The section is about continuity, not creation of a fresh full term. Appointment authority differs depending on the office concerned.

Worked practical example

Facts. A replacement appointed after a Director's mid-term vacancy should not automatically be recorded as beginning a new full statutory tenure.

Compliance points and common mistakes

Do not decide the issue from the heading alone. Map the facts to the operative words of Section 12 and to each relevant subsection, clause, proviso or explanation shown above.
Keep the statutory question separate from the operational overlay. The section is about continuity, not creation of a fresh full term. Appointment authority differs depending on the office concerned.
Do not convert an exception, exemption or discretionary RBI/Government power into an automatic entitlement. Record the authority, conditions and effective date.
Where the provision is historical, omitted or repealed, state that status prominently and do not present it as a current compliance obligation.

Connected provisions and instruments

Section 12 has no universal instrument dependency in this package. Add an RBI circular or direction only when its subject, entity and effective date cover the issue being analysed.

Questions and answers

What is the purpose of Section 12?

Casual vacancies and absences: Section 12 provides continuity mechanisms when the Governor/Deputy Governor is temporarily unable to act and for casual vacancies in the Central Board or Local Boards.

Which statutory limb should be checked first?

Rule 1 - It permits temporary officiating arrangements and specifies how casual vacancies are filled

What is the next legal boundary?

Rule 2 - a person filling a casual vacancy generally holds office for the unexpired portion of the predecessor's term.

What record should support the conclusion?

Section 12 file evidence: For appointment files, state whether the situation is temporary incapacity/absence or a true casual vacancy, because the legal route is different.

Primary sources

Source control for Section 12: use the official consolidated RBI Act for the statutory text and footnotes, then separately reconcile any post-Finance Act 2022 amendment, commencement notification or RBI instrument relevant to the event date.