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Section 32 of The Credit Information Companies (Regulation) Act, 2005.

(1)The Central Government may, on the recommendation of the Reserve Bank, by notification in the Official Gazette, direct that any or all of the provisions of this Act shall not apply to any credit information company or a credit institution, as the case may be, either generally or for such period and subject to such exceptions or modifications, as may be mentioned in that notification.
(2)A copy of every notification proposed to be issued under sub-section (1), shall be laid in draft before each House of Parliament, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in disapproving the issue of the notification or both Houses agree in making any modification in the notification, the notification shall not be issued or, as the case may be, shall be issued only in such modified form as may be agreed upon by both the Houses.

Summary

The Central Government has the power to exempt specific companies or institutions from any or all rules in this Act.
The Government can only grant this exemption if the Reserve Bank recommends it.
An exemption is made official through a notification published in the Official Gazette.
The exemption will not happen if Parliament disapproves it, and it will be changed if Parliament modifies it.

Practical examples

1A rural cooperative bank struggles to meet strict new data requirements. On May 12, 2026, the Reserve Bank recommends exempting them for two years. The Central Government agrees and drafts a notification, which sits before Parliament for 30 days before taking effect.

2A foreign credit data firm asks the Central Government directly for a special exemption from capital rules. The Government rejects the request immediately because the process must start with a recommendation from the Reserve Bank.

FAQ

1. Who actually issues the exemption notification?

The Central Government issues the notification in the Official Gazette.

2. Can the Government exempt a company on its own?

No, it must receive a recommendation from the Reserve Bank first.

3. Can Parliament stop the exemption from happening?

Yes, if both Houses agree in disapproving the issue of the notification, it shall not be issued.

Test yourself

Q1.Under Section 32 of The Credit Information Companies (Regulation) Act, 2005., whose recommendation is strictly required before the Central Government can exempt a company from the Act's provisions?

Q2.Under Section 32 of The Credit Information Companies (Regulation) Act, 2005., how long must the draft notification for an exemption be laid before each House of Parliament?

Q3.Under Section 32 of The Credit Information Companies (Regulation) Act, 2005., what happens if both Houses of Parliament agree in disapproving the proposed exemption notification?

Q4.Under Section 32 of The Credit Information Companies (Regulation) Act, 2005., how is an exemption officially communicated to the public?

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