Correct Option: C

Commercial banks are classified into two: (a) Scheduled banks and (b) other banks. A scheduled bank is one which is included in the second schedule of Reserve Bank of India Act, 1934. A scheduled bank should comply with the following terms: (i) It must have paid up capital and reserves as specified; and (ii) the activities to be carried out should not be detrimental to the interests of the depositors; and (iii) it should be incorporated under the Companies Act, 1956, that is, it should not be the sole trader for a partnership firm or business organization.