Skip to content

CS Executive · Setting Up of Business, Industrial and Labour Laws · Financial Services Organization

After Mr Rao's death, his nephew Vikas sends Kaveri Capital a written notice claiming a share in the nominated deposit, with no court order attached. Under Section 45QB of the Reserve Bank of India Act, 1934, how must the institution treat this?

The institution is not bound by Vikas's notice. Section 45QB(5) bars receiving claims from persons other than the depositor, but if a competent court's decree, order or certificate is produced, the institution must take due note of it. Vikas has produced none.

  1. AIt must freeze the deposit until Vikas's claim is settled
  2. BIt must share the deposit equally between Vikas and the nominee
  3. CIt is not bound by the notice, though it must note any court decree, order or certificate producedCorrect
  4. DIt must refer the notice to the Reserve Bank for a decision

Explanation

Section 45QB(5) says no notice of a claim by anyone other than the depositor is receivable and the institution is not bound by it. The proviso requires it to take due note of a decree, order or certificate from a competent court. Vikas produced none, so freezing is not required.

Did you get it right without looking?

One question tells you little. A timed set on Financial Services Organization shows your real accuracy, how long you take and where you lose marks.

Practise Financial Services OrganizationFree diagnostic mock

More Financial Services Organization questions