The situation mentioned by you is still a grey area. If we strictly go by the provisions of RBI Act and the volume of investments/loans made by the company it appears that in this case registration as an NBFC is necessary. One could take the stand that as per RBI press release dated 8.4.1999 cited above, company does not have any income at all and hence registration is not required. However, how far this stand will be valid is still not known. Further, if there is some little income from interest/dividend in any year, the company will carry risk of non-registration. Hence I feel it would be better to get the company registered as NBFC.
13th April 2009 From India, Malappuram