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2021 Supreme(MP) 158
IN THE HIGH COURT OF MADHYA PRADESH AT JABALPUR BENCH
Vishal Dhagat, J.
Shah Bano Khanam – Appellant
Versus
UCO Bank – Respondent
WP-10748 of 2020
Decided On : 20-01-2021
Advocate Appeared:
For the Appellant : Sharad Gupta, Learned Counsel
For the Respondent: Akhilesh Kumar Choubey, Learned Counsel
Proper joinder of necessary parties and adherence to legal procedures are essential in seeking relief in matters involving disputes over bank accounts and succession rights.
Headnote:
Bank Account - Master Circular of Reserve Bank of India - Clause-6.2, Clause-12 - The court discussed the provisions of the master circular of Reserve Bank of India, specifically Clause-6.2 and Clause-12, which provide guidelines for the settlement of claims of deceased account holders and the rights of survivors/nominees to operate the account without the need for legal representation. The court considered the conflict between the master circular and the objections raised by the son of the deceased, who had filed a Succession Case, leading to a dispute over the amount in the saving bank account.
Fact of the Case:
The petitioner sought permission to operate a joint bank account after the death of her husband, relying on the master circular of Reserve Bank of India. The respondent bank relied on a different clause of the master circular and the objections raised by the son of the deceased, leading to a dispute over the account.
Finding of the Court:
The court found that the son of the deceased was a necessary party in the proceedings and there was non-joinder of necessary party in the writ petition. Additionally, a Civil Suit for obtaining succession certificate was pending before the Civil Court, and it was proper for the petitioner to seek permission to operate the account in the same Court where the civil suit was pending.
Issues: Non-joinder of necessary party, pendency of Civil Suit for obtaining succession certificate, conflict between master circular provisions and objections raised by the son of the deceased.
Ratio Decidendi: The court dismissed the writ petition due to non-joinder of necessary party and the pendency of a Civil Suit for obtaining succession certificate. The court emphasized the importance of following proper legal procedures and seeking relief in the appropriate forum.
Final Decision: The writ petition filed by the petitioner was dismissed.
JUDGMENT :
Vishal Dhagat, J.
1. Petitioner has filed present writ petition making a prayer to issue writ of mandamus to respondent permitting the petitioner to operate the saving bank account No. 14920100000366 after completion of formalities as per master circular dated 02.07.2012.
2. Short fact of the case, is that, the petitioner namely Smt. Shah Bano Khanam has a joint account with her husband namely Nawab Ahmad Yar Jahangir Khan. Her husband expired on 02.03.2019. Despite the fact that petitioner was having a joint account with her husband, she is not allowed to operate the account by the Bank.
3. Learned counsel for the petitioner submitted that Clause-6.2 of master circular of Reserve Bank of India, which is binding upon the respondent provides as under:-
"It may be noted that since payment made to the survivor(s)/nominee, subject to the foregoing conditions, would constitute a full discharge of the bank's liability, insistence on production of legal representation is superfluous and unwarranted and only serves to cause entirely avoidable inconvenience to the survivor(s)/nominee and would, therefore, invite serious supervisory disapproval. In such case, therefore, while making payment to the survivor(s)/nominee of the deceased depositor, the banks are advised to desist from insisting on production of succession certificate, letter of administration or probate, etc., or obtain any bond of indemnity or surety from the survivor(s)/nominee, irrespective of the amount standing to the credit of the deceased account holder."
4. It is further submitted in view of aforesaid master circular, since it is an admitted fact that petitioner was having a joint account with deceased, therefore, petitioner being survivor must be allowed to operate the account as per master circular and bank cannot insist on production of legal representation. It is further submitted by him that there is no restrain order from any Civil Court to the Bank, therefore, respondent ought to have permitted the petitioner to operate the account.
5. Respondent-Bank filed its reply and Bank had relied on master circular in respect of policy of settlement of claims of deceased account holders. Clause-12 of said policy provides as under:-
"Settlement of Claim of deceased A/C holder against legal representation
When legal representation (i.e. probated will or a succession Certificate or a Letter of Administration to the estate of the deceased) is obtained and produced by the Claimants, the branch shall make the payment in terms of the legal representation, after scrutinizing the following:
(i) That the Succession Certificate/Letters of Administration from a Competent court of law or a Certificate from Administration General of the State has been granted pertaining to the estate of the deceased depositor(s) including the balance(s) in account(s) of the deceased etc.
(ii) That the name of the depositor and the account number has been correctly stated in the Succession Certificate/Letter of administration/Administrator General's Certificate.
(iii) That the Succession Certificate/Letter of Administration/Administrator General's Certificate empowers the claimant(s) to collect the entire debt and interest thereon.
(iv) That the amount mentioned in the Succession Certificate/Letter of Administration/Administrator General's Certificate and the balance in the account of the deceased depositor is the same and if there is any difference in the amount, the same is due to application of interest in the account. The branch after verifying the above, may make payment to the claimant(s) on the basis of the Succession Certificate/Letter of Administration/Administrator General's Certificate according to their respective shares mentioned therein as per terms thereof, as per the usual procedure and after calling for all other relevant documents in support/verification of the claim.
(v) When the amount/value involved exceeds Rs. 2,00,000/- (Two lacs) assistance from the Bank's legal retainer may be ta
