Recently, which state's High Court restored the power of the Reserve Bank of India (RBI) to decide the time period after which a bad loan is classified as a non performing asset (NPA)?

Introduction / Context:
Non performing assets (NPAs) are a central issue in Indian banking, and the power of the Reserve Bank of India (RBI) to define when a loan becomes an NPA is very important for financial stability. This question asks about a specific High Court decision that restored the RBI's authority to decide the time period after which a bad loan is to be treated as a non performing asset. Knowing which state's High Court delivered this judgment helps candidates connect current affairs with core banking and economy concepts.

Given Data / Assumptions:

• The RBI is India's central bank and banking regulator.
• There was a legal dispute about who can decide the NPA classification period.
• A particular state High Court restored the RBI's power in this matter.
• Options provided are: Tamil Nadu, Maharashtra, Gujarat, Rajasthan.

Concept / Approach:
To answer, candidates should recall economic and banking current affairs. Courts often interpret laws and regulations relating to the banking sector. The RBI issues circulars and directions on when a loan becomes an NPA, usually based on the number of days of default. At one point, certain directions were challenged, and a High Court ruling became an important news item. Remembering the link between that case and the relevant state High Court allows elimination of wrong options and selection of the correct one.

Step-by-Step Solution:
Step 1: Recall that the dispute related to classification of bad loans as NPAs and whether RBI circulars or other notifications would prevail. Step 2: Identify that the case which restored RBI's power came up before the Gujarat High Court. Step 3: Compare the recollection with the options: Tamil Nadu, Maharashtra, Gujarat, Rajasthan. Step 4: Eliminate the states whose High Courts were not mentioned in contemporary banking news for this issue. Step 5: Conclude that Gujarat is the only option that matches the reported judgment.

Verification / Alternative check:
An alternative way to verify is to connect this with news articles and government exam capsules that highlighted a Gujarat High Court judgment restoring RBI's authority in NPA classification. Many banking awareness notes explicitly mention Gujarat High Court in this context, confirming the correctness of the choice.

Why Other Options Are Wrong:
Tamil Nadu: No prominent case from the Tamil Nadu (Madras) High Court is associated with restoring RBI's power on NPA classification in the standard exam material, so this option is incorrect.
Maharashtra: Although Mumbai is India's financial capital, the key decision in question did not come from the Bombay High Court, so this option is not correct.
Rajasthan: There is no widely cited banking case from the Rajasthan High Court involving restoration of RBI authority on NPAs, so this option is also wrong.

Common Pitfalls:
Students often guess Maharashtra because Mumbai is the financial hub or think of Tamil Nadu or Rajasthan randomly without tying the question to actual news. Another mistake is ignoring current affairs in banking and relying only on static theory. For banking and economy questions, it is vital to track which court, committee, or regulator is tied to a headline, rather than only memorising definitions and formulas.

Final Answer:
The High Court that restored the RBI's power to decide the time period after which a bad loan becomes a non performing asset was the Gujarat High Court, so the correct option is Gujarat.