new born baby visa..

Dear sir,

I am a post graduation student in china, it's my second year here in yantai of shandong province. my wife to PRC on S2 type in july and we have a baby born on 7 october, my X1 type is gonna expire on 1 december 2015 but i will get extension for 1 year as here is the rule of renewal year by year. because i am going to graduate in 2017. my wife's S2 type will expire on 18 jan 2016.
one of police man told me that my baby have to exit PRC within 45 days and then re enter...
i want to know what is the rule and regualtions for new born in PRC.. do we need to exit?
i will get his passport after 15 days.

please guide me, i am in big tension after that news.

thank you