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CS Professional · Insolvency and Bankruptcy - Law and Practice · Debt Recovery and Securitization

A Recovery Officer sends a notice under section 28(3) to Sunrise Bank, where the defendant, Mr. Iyer, holds a joint account with his wife. The notice requires the bank to pay the defendant's money. Which statement is correct?

The notice is valid for a joint account. The shares of the joint holders are presumed equal until the contrary is proved, and a copy of the notice must be sent to all joint holders. The bank cannot insist on producing the pass book before paying.

  1. AThe notice cannot be issued for a joint account
  2. BThe shares of joint holders are presumed equal until the contrary is proved, and a copy of the notice goes to all joint holdersCorrect
  3. CThe whole balance belongs to the defendant by presumption
  4. DThe bank may delay payment until the pass book is produced for endorsement

Explanation

Section 28(3)(ii) permits notice for money held jointly and presumes equal shares until the contrary is proved. Clause (iii) requires a copy to all joint holders. Clause (iv) says that no pass book needs to be produced before payment.

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