One of my clients recently had a case which I am explaining below and if you are stuck in such similar situation, here is what to do.
Note: Due to attorney-client privilege, I cannot disclose complete case details or identify the actual parties involved. However, I am sharing the essential facts and legal approach so that if you find yourself in a similar situation, you can understand the available solutions and legal remedies.
Vikram Singh approached me when he and his mother Sunita Singh were facing severe difficulties in claiming a fixed deposit worth Rs. 8.5 lakhs from Punjab National Bank, Andheri branch. His grandparents, Ram Prasad Sharma and Kamla Sharma, had both passed away within six months of each other. Sunita Singh was their only daughter and legal heir. Despite having death certificates, legal heir certificates, and all required documents, the bank kept demanding additional paperwork and creating unnecessary delays. The bank manager was asking for succession certificate, then demanding notarized affidavits, then requiring additional witness statements. After six weeks of running between bank and various offices, Vikram contacted me for legal intervention. The bank was clearly violating RBI guidelines and causing mental harassment to genuine legal heirs.
Advice in Such Cases
Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation to come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.
Gather all original documents including death certificates, legal heir certificates, and account statements. Send a legal notice to the bank citing RBI guidelines for settlement of claims. File a complaint with the Banking Ombudsman if the bank continues to create obstacles. Document all interactions with bank officials for evidence purposes.
Applicable Sections of Law
Under the Bharatiya Nyaya Sanhita (BNS), Section 316 deals with criminal breach of trust which applies when banks wrongfully withhold deposits of deceased persons. Section 351 covers wrongful restraint of property belonging to legal heirs. The Bharatiya Nagarik Suraksha Sanhita (BNSS) Section 174 provides procedures for claiming deceased person’s assets. Additionally, the Indian Succession Act 1925 and RBI Master Circular on Customer Service govern such situations. Banks violating these provisions can face both civil and criminal liability for harassment of legal heirs.
Relevant Legal Precedents
Various High Courts have established that banks cannot demand excessive documentation beyond what is prescribed by RBI guidelines. The Supreme Court has held that legal heirs have absolute right to claim deceased person’s deposits upon producing valid succession documents. Courts have consistently ruled that banks creating unnecessary hurdles can be held liable for compensation and damages. The principle established is that banking services are public utilities and cannot be denied without just cause.
If you need specific judgement references for your case, you can contact Adv. Sudhir Rao on his helpline numbers for detailed legal research and citations.
If You Are the Complainant
File complaint with local police citing criminal breach of trust if bank officials are demanding bribes or creating intentional delays. Approach Banking Ombudsman with all documentation of bank’s refusal. Send legal notice to bank manager and regional head demanding immediate release of funds. File consumer complaint seeking compensation for mental harassment and financial losses. Document all interactions and maintain written correspondence with bank officials.
If You Are the Victim
Collect all documents including death certificates, legal heir certificates, and relationship proof with deceased. Submit written application to bank manager with all required documents as per RBI guidelines. Maintain copies of all submissions and get acknowledgment receipts. If bank creates delays beyond 15 days, file complaint with Banking Ombudsman immediately. Seek compensation for mental harassment and loss of interest on delayed payments.
How the Police Behave in Such Cases
Initially, police may be reluctant to register FIR in banking disputes, treating them as civil matters. However, when criminal breach of trust or cheating is involved, police are bound to investigate. Officers typically advise approaching Banking Ombudsman first. In cases involving corruption or bribery demands by bank officials, police cooperation is generally better. Documentation of all evidence is crucial for police to take action against banking institutions.
FAQs People Normally Have
Q: How long should bank take to release deceased person’s FD?
A: As per RBI guidelines, banks should settle claims within 15 days of receiving complete documentation.
Q: What documents are mandatory for claiming FD?
A: Death certificate, legal heir certificate, claim form, identity proof, and relationship proof with deceased.
Q: Can bank demand succession certificate for small amounts?
A: No, for amounts below Rs. 5 lakhs, legal heir certificate is sufficient as per RBI guidelines.
Q: What if there are multiple legal heirs?
A: All legal heirs must jointly apply or provide consent letter for one person to claim on behalf of others.
What Evidence Is Required?
- Original death certificate of account holder
- Legal heir certificate from revenue authorities
- Identity proof of claimant with address proof
- Relationship documents like birth certificate or family register
- Bank account statements and FD receipts
- Written application with claim form duly filled
- Indemnity bond if required by bank
How Long Will the Investigation Take?
Banking Ombudsman typically resolves complaints within 30-60 days. Police investigation, if FIR is filed, may take 3-6 months depending on complexity. Consumer court proceedings can extend from 6 months to 2 years. However, most cases get resolved within 30-45 days once proper legal notice is served to the bank, as they prefer avoiding prolonged litigation.
Advocate Sudhir Rao, Supreme Court of India