The Reserve Bank of India RBI controls and supervises commercial banks through which of the following measures?

Introduction / Context:
The Reserve Bank of India RBI is the central bank and primary regulator of commercial banks in India. This question checks whether you understand the basic tools and methods RBI uses to control and supervise banks. Instead of relying on a single mechanism the central bank uses a combination of reporting requirements inspections and follow up actions to ensure that banks remain sound and comply with regulations.

Given Data / Assumptions:

• The question lists three specific actions calling for returns, periodic inspections, and follow up actions.
• These actions represent standard regulatory practices globally.
• We assume a normal supervisory framework where RBI monitors banks on an ongoing basis.
• We need to decide whether RBI uses one of these or all of them together.

Concept / Approach:
RBI controls and supervises banks through off site and on site supervision. Off site supervision involves calling for regular returns and reports on capital adequacy, asset quality, liquidity, profitability and other key indicators. On site supervision includes periodic inspections and audits carried out by RBI supervisors at bank branches and head offices. After obtaining data and inspection findings RBI takes follow up action such as issuing directions, imposing restrictions, or recommending corrective measures. Therefore all three listed measures are genuine parts of the supervisory toolkit and work together to maintain the stability of the banking system.

Step-by-Step Solution:
Step 1: Consider measure A. Calling for returns and information is clearly a standard regulatory practice and is definitely used by RBI.Step 2: Consider measure B. Periodic inspections of banks are one of the most important ways RBI checks compliance and risk management.Step 3: Consider measure C. Follow up action is necessary to ensure that identified problems are corrected; otherwise supervision would have no practical effect.Step 4: Recognise that RBI does not rely on only one of these methods but uses all of them in combination.Step 5: Choose option D which states that all of the above measures are used.

Verification / Alternative check:
In any supervisory system if a regulator only collected data but never inspected banks, or inspected banks but never took follow up action, control would be ineffective. RBI circulars and annual reports describe both off site monitoring based on submitted returns and on site inspection as key pillars of supervision. They also describe prompt corrective action and other follow up steps. This confirms that all three measures named in the question are valid and that option D is the correct answer.

Why Other Options Are Wrong:
Options A B and C individually mention true statements but each covers only one aspect of supervision. Selecting any single method would wrongly imply that RBI does not use the others. For example choosing only A would ignore inspections and corrective actions, which are crucial. Therefore the only complete and accurate answer is that RBI uses all of the listed measures together.

Common Pitfalls:
Some candidates may think that calling for returns is enough and underestimate the importance of physical inspection. Others may focus only on inspections and forget that ongoing off site monitoring and follow up directives are equally important. To avoid such mistakes remember that modern bank supervision is a continuous process that combines reporting, on site examination and corrective actions to maintain financial stability.

Final Answer:
The Reserve Bank of India controls commercial banks by calling for returns, conducting periodic inspections and taking follow up action, that is, by using all of the listed measures.