Under Section 45(2) of the Banking Regulation Act, 1949, the Central Government, after considering an application from the Reserve Bank, may make an order of moratorium in respect of a banking company staying all actions and proceedings against it. The total period of moratorium under Section 45 shall not exceed:

Section 45(2) provides that the Central Government may make an order of moratorium staying all actions and proceedings against the banking company for a fixed period on such terms and conditions as it thinks fit, and may from time to time extend the period so however that the total period of moratorium shall not exceed six months. This mirrors the six-month outer limit in Section 37(1) for a High Court moratorium. During the moratorium period, under sub-section (3), the banking company may not, except as directed by the Central Government, make any payment to depositors, discharge liabilities to creditors, or grant loans and advances or make investments in credit instruments. The moratorium is a precursor to preparation of a scheme of reconstruction or amalgamation under sub-section (4).