MANUAL OF INSTRUCTIONS

VOLUME –I

DEPOSITS

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 INDEX

Table of Contents
Serial Subject Page No.
No.

1 Book Keeping 3

Deposits - General
2 43

Current Accounts
3 257

Savings Bank Accounts

4 309

Current/Savings Bank A/cs-General

5 336

Redesigned Saving Bank A/c & Current A/c

6 387

Fixed and Short Deposits A/Cs.

7 430

Monthly Income Certificates

8 468

Double Benefit Deposit A/cs

9 476

Recurring Deposit A/cs

10 485

11 Cash & Clearing 496

12 Inoperative/Dormant Accounts/Unclaimed deposits 606

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 CHAPTER - 1:
NOTES ON BOOK – KEEPING
All business entity will be operating for profits. This needs keeping a systematic
records of day to day events, so as to know about its profits, assets and liabilities. It
means that, entity must keep records of their income, expenditure and financial
status. Recording of business events and transactions in books of account is called
Book-Keeping.

Accountancy involves, systematic classification of business transactions for recording

them in the books of accounts in an analytical form. Subsequently, summarizing the
recorded events to prepare Trial balance from a ledger and thereafter Profit and Loss
account & Balance Sheet. These financial statements exhibit a “true and fair” picture
of the financial condition of a business entity on a given date. We will be interpreting
the financial transactions (in terms of money) from the recorded data and financial
statements.

In a single entry system, an incomplete or partial record of transactions is kept (say

financial statements prepared from cash book or bank book). In the double entry
system, every business transaction is recorded in books of account in two accounts,
one account is debited and the other is credited (dual aspects of the transaction). At
present, in our bank, double entry system is being followed.

Now, let us discuss about the books of accounts of following entity in brief:

The Small Trader

A small trader running his business on cash basis maintains accounts of

(a) Cash received from sale of goods
(b) Cash paid for purchase of goods.

The cash on hand with the trader at the end of the day would (a) minus (b)

Say for example :

(a) Cash received from sale of goods 1000
(b) Cash paid for purchase of goods 800
Cash on hand = (a) minus (b) 200*

He finds out periodically the profit or losses that he has made, in the following manner
(a) Current value (lower of cost or net realizable value) of goods on hand
Plus (b) Cash on hand
Minus (c) Cost price of goods on hand
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 (d)Resultant position is the Profit/Loss
At the end of a day...
(a) Current value (i.e. lower of cost or net 2200
realisable
value) of goods on
(b) Cash on handhand 200*
(c) Cost price of goods on hand 2200
Profit 200
At the end of the day, if his cash on hand matches with his previous day's cash on
hand plus his receipts of the day minus payments, the trader has balanced his
account. This method of accounting of a small trader is not useful for a large size
business, say that of a wholesaler.

The Wholesaler
A wholesaler buys and sells goods on credit and his accounts are, therefore, not so
simple as those of Small Trader. He has to keep accounts of:

i) Goods bought on credit iv) Goods sold on credit

ii) Goods bought on cash v) Goods sold on cash

iii) Cash paid towards liquidation of vi) Cash received in respect of
credits granted previously by goods previously sold on credit
manufacturers

The wholesaler will have maintain accounts of persons from whom he has bought
goods on credit and to whom he has sold goods on credit. In addition, he will also
maintain accounts of goods purchased or sold against cash. His accounts will be
somewhat as follows:

Less equal to:

(a) Cash received for sale of goods, (on credit and on cash basis)
(b) Cash paid out for goods bought (on credit and on cash basis)
(c) Cash on hand

The wholesaler ascertains his net position, that is to say, whether he has made profits
or losses, in a similar way to the trader, with the following variations:
(a) Current value of goods on hand (lower of cost or net realizable value)
Add (b) Total outstanding to be received from debtors
Less (c) Cost price of goods on hand
Less (d) Total amount to be paid to creditors
(e) Resultant position is the Profit/Loss

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 Say for example
(a) Current value of goods on hand (lower of cost or net 12,000
(b) realisable
Total value) to be received from debtors
outstanding 3,000
(c) Cost price of goods on hand 8,000
(d) Total amount to be paid to creditors 4,000
Profit 3,000

(Comments: As per accounting norms to know the correct profit the closing
stock is to be valued at cost price)

The book which keeps records of all cash transactions i.e. Cash receipts and Cash
Payments is called the "Cash Book."
The business entity should ensure that the accounting standards followed by them
should be mentioned in their notes to account of the financial statement.
As explained above the trader/wholesaler maintains the books of accounts to work
out his cash and financial position on day to day basis.

The wholesaler keeps a journal/Ledger for recording of the amounts due to him and
due from him by maintaining accounts of individuals who owe him money and to whom
he owes money.

The Bank

We know, bank, the commodity dealt with is money. The deposits paid in by customers
are the goods in which the bank deals; when it lends to the borrowers, the use of
goods, i.e., money, is "sold". The rate (of interest) at which the bank gets the money
from the depositors is the cost price of the goods. The rate at which the bank lends to
the borrowers is the sale price or current value of goods. (The terms "money sold"
and" money bought" are used in broad sense of the word commodity/goods "sold" and
"bought").
We use Finacle Software, which works on the basics of Anywhere, Anytime, Anyhow
Banking Possible. The branches will be Service Outlets (SOLs). The data of all branches
will be stored at Data Centre. All the banking operations at the connected branches shall
take place at Data Centre. The Back Office function, MIS, Integration of Core module
like Government Business Module, CRM –Loans, e-Channel (Internet Banking, ATM,
Mobile Banking, ADC etc., made available through this CBS software. For the purpose
of navigation, the important key functions are described in various “menu”
commands/options, which vary for different products launched by our bank. The bank
runs Help Desk on 24x7 basis as a single point of contact (IP-11111/Web
Access/Landline) for resolution of problems in Finacle.

The bank keeps the accounts by recording:

(a) The deposits kept/paid in by customers/account holders

(b) The deposits withdrawn/paid to customers.

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The Cash Book sets out the daily receipts of deposits by way of cash, cheques and
inward remittances etc., paid in and daily withdrawals by way of cash, cheques and
outward remittances etc.

Though we use Finacle system (computerized accounting) to maintain the daily

business/banking transaction throughout our branches/Centers, basically, bank
charges and recovers interest on the amounts lent to borrowers (which is Lending,
equivalent to the sale price of goods), and pays interest to depositors (which is
acquiring Deposits, equivalent to the cost price of goods) - the difference is Net
Interest Income, which is a component of the resultant profit or loss in its entirety.

Double Entry Book-Keeping

In every business transaction, there are two parties - one is the receiver and the other
is the giver. This two fold aspect (dual aspects) is reflected in accounts by having two
columns in an account. One column is used for transactions in which the benefit is
received and the other column is used for the benefit given. As every transaction has
a two fold effect (i.e. one account receiving the benefit and the other giving the benefit)
it affects two accounts in opposite directions. In double entry system for every
transaction the debit side and credit side is always equal i.e. “every debit must have
a corresponding credit”. This record of the two-fold effect of every transaction is the
basis of "Double Entry Book keeping". Under this system of Book-Keeping all business
transactions are recorded perfectly, completely and systematically.

The Two-fold Effect (Dual aspects of the transaction)

(a) When a customer deposits money in his account

(i) the receiver is the "Cash Account"
(ii) the giver is the "Customer’s Account"
(b) When a customer withdraws cash from the bank
(i) the receiver is the "Customer's Account"
(ii) the giver is the "Cash Account"

The bank/branch has to keep a record of the accounts of the giver and the receiver of
the benefit. In the Journal / Cash book, the cash transaction in any account is divided
into two sections, one section is the debit column and the other is the credit column.
We can observe these transactions through Cash Receipt and Cash Payments
reports, through Finacle. The basic rule is: Credit the account of the giver and debit
the account of the receiver.

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Say for example, the following transactions took place in a bank/branch:

Date Rs.

1st Customer A deposits 800/- In his account

2nd ” B ” 700/- ”

3rd ” C ” 1,000/- ”

” ” A withdraws 400/- from his account

” ” B ” 500/- ”
4th ” C deposits 1,100/- In his account.

These transactions appear in the “Cash Account" and “Customer's Account” as under:

Cash Account
Date Particulars Debit Credit
(being the (being the
RECEIVER ) GIVER ) Balance

Rs. Rs. Rs.

1St To Customer A 800 800
2nd ” ” B 700 1,500
3rd ” ” C 1,000 2,500
” By ” A
400
” ” ” B 500 1,600
4th To ” C 1,100 2,700

Customers' Account

Date Particulars Debit Credit Balance

Rs. Rs. Rs.

Customer A
1St By Cash 800 800
3rd To Cash 400 400

Customer B
2nd By Cash 700 700
3rd To Cash 500 200

Customer C
3rd By Cash 1,000 1,000
4th By Cash 1,100 2,100

We know that, system provide the credit balance without any sign (say +), whereas debit
balances are marked with a sign “- “(Negative/Minus) or a number prefix with “dr”. Generally,
the balance in Loans, Cash Credit/Over draft or debit balance in Saving or Current account
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are marked with the given sign or “dr”. The credit and debit entries are posted in the system
from the credit and debit "vouchers" by the user of the finacle system. When a customer
deposits money in his account, he fills in a paying-in-slip with the date, the name (of his
account) and the amount (The particulars of denominations of currency notes, or cheques
are entered on the reverse of the paying-in-slip).These paying-in-slips are credit vouchers.
When a customer desires to withdraw money, he writes a cheque/withdrawal slip (i.e. enters
the particulars of the date, the name of the payee and the amount) and signs it. When
cheques /withdrawal slip are presented to the Bank for payment, the cheques/withdrawal
slips are debit vouchers. These credit and debit vouchers are “posted" i.e. Entered in the
system, Posted and verified in the predesignated accounts or account heads related to the
customers.

Occasionally, credit vouchers (Generally Green color) are prepared by the Bank/SOLs, say
for crediting the proceeds of a bill collected or remittance received by it. Similarly, debit
vouchers (Generally white color) are also prepared. by the Bank/SOLs for recovering
commission, charges, fees, dues from customers or for transferring amounts from accounts
of customers, within SOLs or with other SOLs etc (it is necessary to have the written authority
from customers to debit their accounts). With regards to the vouchers prepared by the
Bank/SOLs, the officer's signature thereon constitutes the authenticity and authority to post
the vouchers. Now, through finacle we can print any voucher for keeping as a record for future
perusals too.

Balancing the books of Account

The balancing of all books of accounts plays important role to control and monitor its
accuracy. It is necessary to find out whether a person has received more than what
he has given or whether he has given more than what he has received. This process
is called "balancing". It involves adding up the debit side of an account, adding up the
credit side and ascertaining the difference. The difference is written on the lesser side,
so that the totals of two sides, with the difference added to the lesser side, should
agree. Let’s illustrate this, with following example:
Account of Mr. A. Raman

Date Particulars Cheque Debit Credit Balance

Number Rs. Rs. Rs.

1st By Cash 1,000 1,000

” To Mr. G 1234 70 930

3rd To Mr. X 1235 80 850

15" To Mr. Z 1236 50 800

” By. Cheque on Poona 1,800 2,600

realized

17th To Mr. M 1238 1,200 1,400

30th To Balance c/d 1,400

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 2,800 2,800

30th By Balance b/d 1,400 1,400

Account of Mr. Bose

Date Particulars Cheque Debit Credit Balance

Number

Rs. Rs.
Rs.
1st By Cash. 700 Cr. 700
5th To Mr. R 2375 800
” To Mr. J 2378 900 Dr. 1,000
18th To Mr. N 2379 500 Dr. 1,500
30th By Balance c/d 1500 1,500

2,200 2200

30th To Balance b/d 1,500 Dr. 1,500

In the first example, the total of credits is greater than the total of debits. The balance
is the difference on the lesser side, that is, debit side, where the description "To
Balance carried down" (c/fd) is written along with the difference. The account is then
closed by drawing parallel lines __ one line above and two lines below the total of
debit and credit columns {2800}. After closing the account, the balance is shown under
credit column as "By Balance brought down" (b/fd).

In the second example, the total of debits is greater than the total of credits. The
balance is the difference on' the lesser side, that is, credit side, where the description
“By Balance carried down" (c/fd) is written along with the difference. The account is
then closed by drawing parallel lines - one line Above and two lines below the total of
debit and credit columns {2200}. After closing the account, the balance is shown under
debit column as "To Balance brought down" (b/fd).

The book in which the accounts of depositors and borrowers are kept is called a
"Ledger". Transactions are entered in the ledger in order of date. Each debit entry
commences with the word ' "To" and each credit entry commences with the word "By".
Debit balances are indicated by Dr. (short form for debit) and credit balances are
indicated by “Cr.” (Short form for credit). Dr. or Cr. is written before the, amounts of
balances, e.g., Dr. Rs. 5,380/-, Cr. Rs. 3,540/-. In Deposit Ledgers such as Current
Accounts only debit balances are indicated by Dr., since all other balances are credit
balances.

The above said examples are provided to know about the concepts of accounting
practices, so that the flow of transactions can be easily understood by the users. Now,
in finacle (termed as “real time on-line system or system” henceforth) we programmed
work flow of all type of banking transaction into Scheme codes and respective pre-
designated accounting heads. This system consider every customer of a branch, as
a Customer of Bank holding unique customer ID. The software encompasses all the
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retail function like Saving, Current, Cash Credit Overdraft, Term Deposits,
Term/Demand Loans, Safe Deposit Vaults, Demand Draft/Pay slip etc. The security
features include Maker-Checker Concept, Audit Trail etc.

Through finacle system, banking business leveraged to suit the ever-changing needs
to provide real time on-line banking. Besides retail function, Trade Finance module
(Inward/Foreign Bills, Documentary Credits, Guarantees, Remittances, Foreign Trade
Credit & Forward Contracts), Customer Relationship Module (CRM- for Loan
Originating System), Government Business Module (Pension, PPF, CBDT, RBI
Bonds, Government Business) and e-Channel being implemented to cover volume of
business and consistently achieving growth at large. Briefly, from creation of users of
the system, every transaction is completed through three stages: “E” = Enter, i.e.
data entry related to transaction, “P”=Post, i.e. Data updated in the system & “V”=
Verified, i.e. All transaction entered, posted in the system should be Verified before
End-of-day (EOD).

All Branches termed as SOLs (Service Outlets) and carry a SOLsID (Identification
Number). Every SOLs has to initiate Begin-of-the day (BoD) and End-of-Day (EoD)
process. During the business day, users input various transactions at SOLs. The
transaction may belong to any category Cash, Transfer, or Clearing. The user will
specify the debit transaction and credit transaction. The system will check for the total
debit matching with credits. Unless transactions in the books of account are balanced
EOD will not be allowed. The daily process of validation of transaction in the system
is carried out before EoD through SOLVAL (Service Outlet validation
Process),followed by CSOLOP (Close Sol Operations)at individual branch as well as
at Data Centre for Bank as a Whole.

The accounts are correctly opened in GL Head (specific scheme type with a scheme
code to position the concerned account in General Ledger Balance) and GL Sub head
Code (Specific defined Scheme Type) / proper Scheme Code and special service
charge as provided in the work flow of the product. In the system upper limits are set
for amounts of each transaction like Debit and credit for all scheme type. Upper limits
are set in system for debit part transfer of cash, clearing and transfer transactions.
The system will not allow transaction above these limits, i.e. abnormal limits. The
system will balance each and every transaction, clearing zones are released and
regularized on all working days. With regards to inter SOLs transaction and other
transaction there exist reconciliation available through various reports, menu options.

Generally, we work with Finacle DC (Data Centre), which provide the banking
transaction on real time basis and reports through MISREP (Miscellaneous Report).
Considering the Disaster Recovery and Business Continuity Plan, there exist Finacle
DR (Disaster Recovery), which provide back up, cutover and reports along with
Finacle DC too. The system provides various reports for control and retrieval of details
of all/any transaction. These reports can be used at SOLs, Controlling offices (Zonal
/NBG/Head Office), as well reporting to the regulator (RBI) through BSR (RBI
Reports). The detailed reports can be seen through EODREP (End-of-Day Reports)
of menu MISRPT (Miscellaneous Reports) in Finacle Dr1. The details of work flow,
transaction related activity, and various reports/Audit Trails/summary/a/c jotting-
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Scheme code wise or Summary/ Profit & Loss Sheets/register/ledger/ General Ledger
Balance/Branch Daily Statements viz Finacle in toto, can be learned through HRMS -
ELM, a module christened as “Overview of Finacle”.

Before migration to current Finacle Advance Versions, Manual system was run
through Ledger for ease of banking operations. Later in migration of the system,
keeping the accounting principle intact, the real time on-line banking operations were
facilitated through introduction of Scheme Type, Scheme Code, and Special charges
code. In Finacle System, the following books/records are available / maintained at all
SOLs:

MAIN BOOKS/ RECORDS

Cash Department (Menu – SCWRPT or SCWRPTA –report Teller Counter wise)

(a)Cash Receipt Book .. .. .. (keeps a day-to-day record of the cash

received)

(b)Cash Payment Book .. .. .. (keeps a day-to-day record of the cash

paid)

Accounts Department
Specific Scheme Type, Scheme Code, special charges code for various
products

Project Star Shakti (CBS), Volume 1 to 6, MDI Study Material, Mumbai. Various Head
Office Branch Circulars (HOBC) & HO Circular Letter (HOCL) related to
Finacle/Project Star Shakti.

HRMS-ELM Human Resources Management System –Employee Learning

Management (Location – Self Service Intra/Internet Mode).

(a) Current Account (the accounts of customers who maintain

Current Deposit Accounts with the SOLs)

(b) Savings Bank (the accounts of customers who maintain

Savings Bank Accounts with the SOLs)

(c) Fixed & Short Deposits (the accounts of customers who have fixed
or Short Deposits with the SOLs)

(d) Monthly or quarterly Income Certificates. (The records of MIC/QIC Accounts)

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 (e) Double Benefit Deposit The records of DBD A/cs.

Loans/Advances (The record of loan accounts.)

(f) Loan The records of customers to whom the branch

has granted loans with record of the security
held in each loan accounts.

(g) Cash Credit The records of customers to whom the branch

has granted cash credit advances, and a
record of security held in each cash credit
account.

(h) General Ledger (keeps a day-to-day record of total balances

in each type of scheme code, scheme type,
Product).

The General Ledger is posted as per work

flow correlated with the transaction activity in
the system.)

SUBSIDIARY BOOKS

(I) Cash Transfer Book (Keeps a continuous record of the transfer

Vouchers passed i.e. from one account to
another Account, kept manually to have
control over the cash movement in/out of a
cash counter or SOL).

(ii) Clearing related activity fully automated, Cheque Truncation System

followed with pre-designated accounting
heads and reduce the hassles of
Reconciliation of clearing entries.

(iii) Daily Cash Balance Book (keeps a record of the cash in hand with the
denominations of the currency notes and
coins and also total payments and
receipts of cash and cheques of the day,
should match with the Cash Receipt and
Payments generated from the system).
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Accounts Department

i Head Office The transactions of the Branch/SOLs with Head Office

ii State Bank Of The transactions put through the Branch account with the
India/Reserve Bank State Bank Of India/Reserve Bank Of India/Other
Of India clearing Banks
iii Draft Payable The demand drafts Pay Slips payable by the SOLs
through Specific Menus in the system
iv Customers’ Liability The outstanding liability of the Letters of Credit and the
for Letters of Credit Bills Received under Letters of Credit
opened and Bills
Receivable under
Letters of Credit
(Trade Finance
Module)
v Customers’ Liability The outstanding issued Ledger Guarantees issued it is
for Guarantees maintained customer wise.
(Guarantee related
Menus)
vi Profit and Loss The profit and loss vouchers are posted in the Profit and
Analysis Book (BR- Loss Analysis Book. The system reports shows two
40, whereas BR-39 parts- credit and debits. Each part is subdivided into
consolidated details) various head to facilitate tabulation of earnings and
expenses under various categories of income and
expenditure.

Cash Transfer Book

Cash Transfer Book keeps a record of "transfer" vouchers passed each day at a
Branch. As the name of the transactions "transfer” indicates, there is a flow of funds
from one account to another account within the Bank; there is no outflow of funds from
the Bank. The 'transfer" vouchers, transfer amounts (funds) from one account to
another account maintained in a Branch or the Bank.
Illustrations
(i) If a customer deposits a Cheque in his account drawn by another 'customer
of the same Branch, there is transfer of funds from the account of the drawer
of the Cheque to the account of the payee of the Cheque.

(ii) If a customer deposits a Cheque in his account drawn by a customer of

another Branch, there is transfer of funds from the account of the drawer of
the Cheque maintained at one Branch to the account of the payee
maintained at another Branch.

In both these illustrations, though there is transfer of funds from one account to
another account, there is no outflow of funds from the Bank.
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Until the credit and debit vouchers are entered in the Cash Transfer Book, they are
pinned together. The Cash Transfer Book is divided into two parts the left-hand-side
is the debit side and the right-hand side is the credit side. The titles of accounts and
amounts of debit vouchers are entered on the left hand side and the titles of accounts
and amounts of credit vouchers are entered on the right-hand side. The totals of the
credit side and the totals of the debit side should always agree; if they do not agree
there is a mistake in a set of debit and credit vouchers wherein the amount of the
debit voucher(s) does not agree with the amount of the credit voucher(s). After the
particulars of vouchers are entered in the Cash Transfer Book and the stamp
"Transfer" is affixed on all vouchers, the pin which keeps the debit and credit
vouchers together is removed and the debit and credit vouchers are released to the
users for posting in the system. It facilitate the easy movement of cash and its controls
within a SOLs through cross-verification.
In addition to keeping a record of transfer vouchers, the Cash Transfer Book serves
to ensure that the amount(s) entered on the debit voucher(s) is equal to the amount(s)
entered on the credit voucher(s) in every transaction.

Clearing

Apart from cash transactions (cash receipts and cash payments) and transfer
transactions, there is another type of transactions called "clearing" transactions. In
these transactions, there is inflow and outflow of funds from/to other banks. When
customers deposit cheques drawn on other banks, these cheques are sent to the
banks (on whom they are drawn) and funds are received from the other banks (in
payment of the cheques sent to them). The cheques sent to other banks through
Clearing House are "Outward clearing cheques". The cheques drawn by the
customers of the Branch and received from the Clearing House are called "Inward
clearing cheques". Banks affix clearing stamp on the cheques and relative paying-
in-slips to distinguish them from cash and transfer vouchers. Now this function is
carried out through CTS and fully automated barring few centres who works on Local
Clearing Centres, pooled through specific clearing account heads in the system.

General Ledger

In a bank there are many types of accounts: Current Accounts, Savings Bank, Cash
Credits, etc., each type of account has one or more ledgers depending upon the
number of account holders.

The Manager of a Branch has to know the day-to-day developments to get an overall
picture of Branch business. It is not necessary for him to go through all the
transactions in detail to arrive at conclusions regarding the business transactions on
each day.

If this picture were to be obtained from various ledgers, it would be very laborious
and time-consuming; for instance, if the total Savings Bank deposits on any day were
to be found out, this could be done by jotting down the balances of all Savings Bank
Accounts and adding them up.
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Similar efforts would have to be made to find out the summaries of transactions taking
place in Current Accounts, Loans and so on. The laborious process described in the
earlier paragraph is obviated by the General Ledger Balance report (EOD009).

The General Ledger keeps a record of total balances in each type of ledger account,
e.g., Current Accounts, Savings Bank, Loans, Cash Credits, etc. Every day, the totals
of the debits and credits (obtained from respective Supplementary Cash Books) are
posted in each General Ledger Account. If a General Ledger Account has credit
balance at the commencement of business, the amount of credits of the day are
added to it that General Ledger Account. If the General Ledger Account has a debit
balance at the commencement of a day, the total debits are added to the balance
and totals of credit's are subtracted from the balance to arrive at the new balance (at
the end of the day) of a General Ledger Account.

Thus the General Ledger balances summarise the effects of each day's receipts and
payments of all General Ledger Accounts.

Liabilities

Liabilities are the debts owing by a person or a firm. Such liabilities appear as credit
balances in the books of accounts of these persons or firms. Bank is no exception to
this. Hence all Ledger Accounts in the General Ledger of a Branch with credit
balances are Liabilities. When the Branch accepts deposits in:
(i) Current Accounts
(ii) Savings Bank Accounts, Recurring Deposits Account
(iii) Fixed & Short Deposits Accounts
(iv) Monthly Income Certificates
(v) Double Benefit Deposits
(vi) We hold various deposit products related to each and every category of
customers (star Gurukul, star Rakshak, Jai Jawan Salary account, Star Yuva, Star
Mahila bachat etc.)Branch is liable to repay them to the depositors.
(vii) All these deposit accounts generally have credit balances.

In addition to these deposit accounts, the following are some of the liabilities of the
SOLs:

 The Drafts Payable Account has a credit balance and denotes the
amount of outstanding Demand Drafts payable by the Branch
 Head Office balance with the Branch, if the balance is in credit (like
deposits of a customer)
 Credit balances of Cash Credits (the credit balances are "deposits")
 Credit balances of Loans
 Contra Liabilities in respect of the Assets for

(a) Letters of Credit opened

(b) Guarantees Issued
(c) Bills for Collection
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(i) Inward Bills for Collection
(ii) Outward Bills for Collection
(iii) Profit and Loss Account (Profit).

Assets

Assets are:

(a) all sums of money owing to a person or firm

(b) All properties belonging to a person or a firm (such as furniture,

buildings, cash, etc.).

Hence all Ledger Accounts in the General Ledger with debit balances, are
Assets. The following General Ledger Accounts are some examples of Assets:

i.Cash on Hand ii. Head Office balance with the Branch

if the balance is in debit (like advances
to customers)
iii. Balance of the Branch with iv. Furniture & Fixtures
the Reserve Bank of
India/State Bank of India
v. Loans vi. Cash credits
vii. Bill Discounted viii. Bill Purchased
ix. Bills Receivable under x. Stamps and stamped Documents in
Letters of Credit Hand(rare field, due to on-line
availability of stamps)
xi. Security deposits xii. Contra Assets in respect of the
Liabilities for
(a) Letters of Credit Opened
(b) Guarantees issued
(c) Bills for collection
xiii. Outward Bills for xiv. Inward Bills for collection
collection
xv. Profit and Loss
Account(Loss)

General Ledger Account - Sundry Deposits

This Scheme code /Scheme Type head contains only-the credit items that are
in the nature of liabilities as defined under Section 42 (2) of the Reserve Bank
of India Act, 1934. This ledger head is shown separately in General Ledger
Balances after Current Deposits and for the purpose of Bank's Balance Sheet
it should be included in the current deposits. The following items form part of
Sundry Deposits and for each such item a separate account is maintained in
the Sundry Deposits ledger:
16
  Unclaimed dividend/bonus, excess cash received/cash found on premises,
deposits received for the credit of non-existent/non traceable accounts
(unknown deposits), etc. which are payable to others.
 Balances in Dormant Accounts of Current Deposits, i.e., Balances in non-
operative accounts which are transferred to Dormant Accounts.
 Margin money or deposit held against letters of credit' or guarantees and/or
security deposits/margin for advances, that are payable on demand.
 Call/allotment money on shares, debentures, etc.
 Taxes deducted in advance to be remitted to the respective Tax Authorities.
 Amount of Income tax and other taxes and duties paid at the Branch for
remitting to the respective authorities, kept in suspense pending clearance of
cheques of other Branches/banks.
 Interest accrued and payable on term deposits such as interest provisions on
fixed deposits, short deposits, etc., pertaining to the various half years.
 Credit balances of Advance accounts, if any.
 Any other deposits/balances that are payable to others pending disposal.

General Ledger Account - Sundry Credits

This General Ledger head (Scheme Type/ Scheme Code) contains only credit
balances of the various suspense accounts that are not in the nature of
liabilities as defined under Section 42(2) of Reserve Bank of India Act, 1934. It
contains the following items for which also separate accounts should be
maintained in the Sundry Credits ledger:

 Credit balances relating to income received in advance, to be appropriated

later, such as Rent on Safe Deposit Vault, Commission on Guarantees, Safe
Custody Charges, etc.
 Provision made for expenses.
 Amount received towards settlement of advances kept in suspense pending
final settlement (such as payments received from borrowers, claim amount
received from Deposit Insurance & Credit Guarantee Corporation, etc.).

General Ledger Account - Suspense Accounts (Debits)

This General Ledger head will contain only debit balances. Following are some of the
accounts that will, come under this General Ledger head:

 Amounts paid to customers in fraud cases after Head Office sanction.

 Salary Advances to staff for festival.
 Account for Petty Cash.
 Any debits of advance nature.

Each of the above mentioned General Ledger accounts will be maintained in separate
ledgers as under:

I. Sundry Deposits Ledger for Sundry Deposits accounts.

17
 II. Sundry Credit Ledger for Sundry Credit accounts.
III. Suspense Accounts (Debits) Ledger for Suspense Accounts (Debits).

The total of the balances in these ledgers is reflected in the relative General Ledger
account as stated above.

Overdrafts
The Bank allows Current Account holders, with previous arrangement, to use Bank's
funds. In other words, Current Account customers are allowed to withdraw money
beyond their own funds in their Current Accounts. These accounts are called
"Overdraft Accounts". The Overdraft Accounts have debit balances and are,
therefore, assets. The total of all debit balances of Overdraft Accounts appear under
"Assets".

The balance in the General Ledger Account "Current Deposits" is arrived at by

deducting the total of debit balances of "Overdraft Accounts" from the total of credit
balances of "Current Accounts" and the resultant balance is generally a credit
balance and, therefore, a liability. (Refer to third illustration below for the
explanation).

Illustration

Suppose a Branch when opened has 5 Current Accounts on the opening day of
which 2 Current Accounts have been granted overdraft facility. If the Branch has
received only credits in three Current Accounts and has permitted only withdrawals
in two Current Accounts with Overdraft facility, the position at the end of the day in
respect of the Current Accounts of the Branch will be as under:

Debit Credit
Balances Balances
(i) Current A/c of Mr. A 500
(ii) Current A/c of Mr. B 450
(iii) Current A/c of Mr. C 700

(iv)Current A/c of Mr. D O/D 175

(v) Current A/c of Mr. E A/cs. 103
_______________________________
278 1650
_______________________________

When these totals of credit and debit transactions in Current Accounts are posted in
the General Ledger Account "Current Deposits", the net result will be:
18
 Dr. Cr. Balance
-- Rs.1650/- Cr. Rs.1650/-
Rs.278/- -- Cr. Rs.1372/-
The resultant credit balance of Rs. 1,372/-, however, does not show the total amount
of Current Deposits owing to customers, since the total credit balances have been
reduced by the debit balances of the overdraft Accounts. In order to arrive at the
correct position of the Branch liability to the customers in Current Deposits, it is
necessary to add the debit balances of the Overdraft Accounts to the credit balance
in the General Ledger Account "Current Deposits “in GLB at liability side. The amount
of Current Deposits owing to Current Account customers is, therefore, Rs. 1,372/- +
Rs. 278/- = Rs. 1,650/-.Further, for balancing both the side of GLB, Overdraft amount
of Rs.278/- would be shown at asset side in GLB

Illustration: If the balance in the General Ledger Account "Current Deposits" at the
end of a day is Cr. Rs. 50,10,500/- and the amount of overdrafts (i.e., debit balances
in Current Account Ledger(s)) is Rs. 4,33,450/- then the total amount of Current
Account Deposits owing to customer is:
Rs.
(a) Balance of the General Ledger Account "Current Deposits" . 50, 10,500
add (b) Debit balances of Overdraft Accounts .. 4, 33,450
(c) Current Account Deposits owing to customers 54,43,950

As some Branches the total amount of the Current Deposits owing to customers is
less than the total of debit balances of Overdraft Accounts. The balance in the
General Ledger Account "Current Deposits" is arrived at by deducting the total credit
balances from the total debit balances and in such cases it is debit balance. In order
to find out the total amount of Current Account Deposits owing to customers, the
balance of General Ledger Account "Current Deposits" has to be deducted from the
total of debit balances of Overdraft Accounts.

Illustration: If the balance in the General Ledger Account "Current Deposits" at the
end of a day is Dr. Rs. 5,15,715/- and the amount of overdrafts (i.e. debit balances in
Current Account Ledger(s) is Rs. 32,15,912/- then the total amount of Current Account
Deposits owing to customers is:
Rs.
(a) Debit balances of Overdraft Accounts .. 32, 15,912
less (b) Balance of the General- Ledger Account "Current Deposits" .. 5, 15,715

(c) Current Account Deposits owing to 27,00,197

customers
..
It should be noted that the total amount of Overdrafts at a Branch is ascertained from
19
the Daily Extract of Overdraft Balances Register. As the name of the Register
indicates, the debit balance of each Overdraft Account and temporary Overdraft
Account are entered in the Register every day. The total of all the debit balances in
the Register represents the total amount of Overdrafts. Now a days, this work is being
done by the system itself automatically. Above description is given only for
understanding the book keeping.

The position of credit balances in Cash Credit (or Loan) Accounts is exactly the
opposite of Overdrafts Accounts. The credit balances are in the nature of deposits and
hence a liability, and are, therefore, shown under "Liabilities" in the GLB. The General
Ledger Account "Cash Credits" is the total of debit balances of Cash Credit Accounts
less the total of credit balances of such accounts. Therefore, to arrive at the
outstanding debit balances of Cash Credit Accounts, the credit balances are added to
the balance shown in the General Ledger Account "Cash Credits" in GLB at asset
side.

In order to keep daily record of

(a) debit balances in Current Accounts, i.e., Overdrafts,
(b) credit balances in Loans,
(c) credit balances in Cash Credits,
Separate folios should be allotted in the General Ledger. (Now Finacle takes care of
it)

The following illustrations show how different transactions are recorded in the books
of a Branch:

The position of Assets and Liabilities of the Branch at the opening of the day (01-10-
2017) is as follows:

General Ledger Balances as on 30.09.2017

(Please see notes in the Charts)

Liabilities Assets
Rs. Rs.

Current Deposits 5,000 Head Office A/c 5,125

Add: Overdrafts 200 Cash, 500
State Bank of India 300

5,200 Overdrafts 200

Drafts Payable 750 Outward Bills for Collection 2,000
Liability for Outward Bills for Customers' Liability for Guarantees
Collection 2,000 Issued 2,000
Guarantees Issued 2,000 Stamps and Stamped Documents
Profit & Loss (Profit) 200 in Hand 25

Total 10,150 Total 10,150

20
The following transactions take place at the Branch on 01-10-2017
(i) Customer A deposits cash Rs.100/- in his Current Account.
(ii) Customer B deposits a cheque for Rs.75/- drawn by Customer A.
(iii)Customer C deposits a cheque for Rs.85/- drawn on Ranchi Branch of the Bank.
(iv) Customer A withdraws Rs.25/- by cheque.
(v) Customer D gives two Documentary Bills for Collection-one for Rs.60/- and the
other for Rs.45/-.
(vi) Customer F buys a demand draft for Rs.150/- drawn on Branch “X” and instructs
the Bank to debit his account.

These transactions will be reflected in the different books of the Branch as under:
(i) Customer A deposits cash Rs.100/- in his Current Account:

(a) The customer Mr. A, before depositing cash, gets his paying-in-slip stamped
and numbered from the Scroll Clerk. The Scroll clerk enters the name of the
customer (i.e. title of the account) in the Receipt Scroll Book, affixes the scroll
stamp on the paying-in-slip and enters the serial number from the Receipt
Scroll Book on the paying-in-slip and initials it.
(b) Mr. A hands over the paying-in-slip and cash to the Receiving Cashier. The
Receiving Cashier counts the cash, affixes the “Received” stamp on the
counterfoil and the paying-in-slip and initials/signs the counterfoil and the
paying-in-slip. The Receiving Cashier returns the counterfoil to Mr. A. The
Receiving Cashier then enters the particulars, viz., the name of customer,
the denominations of currency notes received from the customers and the
total amount in the Teller account. Receiving cashier also provides cash
receipt as given by the teller printer to Mr. A.
(c) The paying-in-slip (which is hereafter described as a "voucher") is posted in
the account of Mr. A by the other checker (officer or special assistant). The
checker puts his stamp of verification on the voucher and initials it to indicate
that the voucher is posted in the account. The account is credited with Rs.
100/-.

(d) The particulars (name of the customer, Mr. A, the account number of Mr. A's
account and the amount paid in) are entered on the lefthand side __ credit side
__ in the Supplementary Cash Book.( Now it happens automatically in the
finacle system)

(e) The double entries in this transaction are:

(i) Debit: Cash Account (the entry in Cash Receipt Book/ Teller a/c) __ being
the receiver of the benefit (cash).

(ii) Credit: Customer A's account as stated in (c) above __ being the giver of
the benefit.

21
 (ii) Customer B deposits a cheque for Rs.75/-drawn by Customer A:

(a) As only cash receipts (i.e. cash received on counter) are put through the
Receipt Scroll Book, no entries are made in the Receipt Scroll Book for this
transaction.

(b) The paying-in-slip (together with the cheque pinned to it) is handed over to the
Receiving Cashier. The Receiving Cashier affixes the stamp "Received by" on
the counterfoil, initials and returns the counterfoil to the customer B.

(c) As the cheque deposited by the customer B is drawn by another customer of

the Branch, the particulars of the paying-in-slip and the cheque are entered in
the TM menu of the finacle. Transaction will appear in the transfer book after
day end. The Transfer Book is divided into two parts ___ the right-hand side is
the credit side and the lefthand side is the debit side. The amount of the paying-
in-slip, Rs.75/-, is entered on the credit side together with the name of the
customer, Mr. B; the debit voucher (the cheque for Rs.75/- drawn by Mr. A in
favour of Mr. B) is entered on the debit side. The transfer clerk affixes the
Transfer stamp on the paying-in-slip and the cheque of Mr. A and initials them.

(d) Subsequent procedure is similar to (i) (c) and (d) above except that the cheque
drawn by Mr. A in favour of Mr. B is posted (debited) in Mr. A's account. The
cheque reduces the balance in the account of Mr. A. The credit voucher ___
the paying-in-slip ___ is posted in the account of Mr. B. The balance of his
account increases.

(iii) Customer C deposits a cheque for Rs. 85/- drawn on Ranchi Branch of the
Bank.

Same procedure to follow as for transfer of cheque

(iv) Customer A withdraws Rs. 25/- by cheque:

(a) The Paying cashier posts the payment cheque presented by the customer A
in his account (i.e. debits his account), enters the title of the account, amount
of cheque in the TM menu of Finacle.

(b) The Cancelling Officer cancels the cheque (if it is in order) and initials it.

(c) The Paying Cashier scrutinizes the cheque, and pays cash to Mr. A. Before the
cheque is released to Accounts Department, the Paying Cashier affixes “Paid"
stamp on the cheque and initials it.

(d) The double entries in this transaction are:

22
 (i) Debit: Mr. A's account, being the receiver of the benefit.
(ii) Credit Cash (Teller) Account (payment entry in the Cash
Payment Book), being the giver of the benefit.

(V) Customer D gives two Documentary Bills for Collection - one bill for Rs.60/-
and the bill for Rs. 45/-.
(a)If the bills are in order, the following vouchers are passed : Rs. Rs.
Debit: Outward Bills for Collection 60
-do- 45 105
Credit: Liability for Outward Bills for Collection 60
-do- 45 105

(b) The bills are entered in the Outward Bills for Collection Register and sent
under a covering schedule to a Branch or another bank for collection. When
the bills are paid, the liability entries are reversed.

(c) The payment of the bills is noted in the Outward Bills for Collection Register.
Mr. D's account is credited with the proceeds of the bills less collection
charges, if any, provided they are not paid by the drawees of the bills.

(vii) Customer F buys a demand draft for Rs. 150/- drawn on Branch "X" and
instructs the Bank to debit his Current Account.

(a) The following vouchers are prepared:

Debit: The Current Account of the customer Mr. F with Rs.150/-. (A debit
voucher is prepared giving the particulars of the name of the Branch on whom
the demand draft is required and the amount of the demand draft). If account
cheque is given, then no need of preparing debit voucher.

Credit: Head Office Account "X" Branch (DD CBS 001) (on whom the draft is
drawn) with Rs.150/-.

(Note: The credit voucher is obtained as a draft application form which the,
customer is required to complete and sign).

The credit voucher gives the particulars of:

(i) Name & Code of the Paying Branch

(ii) the name of the payee
(iii) the amount of the draft
(b) The particulars of vouchers are entered in the TM menu of Finacle

(c) The debit voucher is posted in the Current Account of the customer F___ his
account is debited. Similarly credit voucher is posted in DD CBS 001 a/c of
that “X” Branch.

(d) The vouchers are checked and initialed/signed by an officer. The particulars
of the name of payee, amount and the name of the Branch on whom the draft
23
 is required, appearing on the credit voucher should agree with the
instructions of the customers.

(e) After ensuring that the debit voucher is posted in the Current Account of Mr.
F, the demand draft for Rs.150/- is prepared from the credit voucher and
checked and signed by an officer.

(f) The particulars of debit and credit vouchers are entered in the Supplementary
Cash Books of Current Accounts and Head Office respectively (automatically
by the finacle system.)

At the end of the day, when all these transactions are put through the books of the
Branch, they will be recorded as follows:
Accounts in Current Account Ledger
Current Account Mr. A

Date Particulars Cheque Debit Credit Dr/Cr Balance

No.
Rs. Rs. Rs.
30.09.2005 By Balance 1600.00 Cr 1800.00
01.10.2005 By cash 100.00 Cr 1900.00
01.10.2005 To Mr.B xx 75.00 Cr 1825.00
01.10.2005 To Self xx 25.00 Cr 1800.00

Current Account of Mr. B

Date Particulars Cheque Debit Credit Dr/Cr Balance

No.
Rs. Rs. Rs.
30.09.2005 By Balance 1000.00 Cr 1000.00
01.10.2005 By Transfer 75.00 Cr 1075.00
Cheque
Current Account of Mr.C

Date Particulars Cheque Debit Credit Dr/Cr Balance

No.
Rs. Rs. Rs.
30.09.2005 By Balance 400.00 Cr 400.00
01.10.2005 By Cheque 85.00 Cr 485.00
on Ranchi
24
 Current Account of Mr. D

Date Particulars Cheque Debit Credit Dr/Cr Balance

No.
Rs. Rs. Rs.
01.10.2005 By Balance 900.00 Cr 900.00

Current Account of Mr. E

Date Particulars Cheque Debit Credit Dr/Cr Balance

No.
Rs. Rs. Rs.
01.10.2005 By Balance 500.00 Cr 500.00

Current Account of Mr. F

Date Particulars Cheque Debit Credit Dr/Cr Balance

No.
Rs. Rs. Rs.
30.09.2005 By Balance 600.00 Cr 600.00
01.10.2005 To cost of 150.00 Cr 450.00
Draft

Current Account of Mr. G

Date Particulars Cheque Debit Credit Dr/Cr Balance

No.
Rs. Rs. Rs.
01.10.2005 By Balance 200.00 Cr 200.00

Current Account Supplementary Cash Book

Date Particulars Credit Date Particulars Debit

01.10.2005 Mr.A 100.00 01.10.2005 Mr.A 75.00
01.10.2005 Mr.B 75.00 01.10.2005 Mr.A 25.00
01.10.2005 Mr.C 85.00 01.10.2005 Mr.F 150.00
25
 Total 260.00 Total 250.00

Head Office Account (Subsidiary Ledger)

Date Particulars Debit Credit Dr/Cr Balance

30.09.2005 To Balance 5125.00 Dr. 5125.00

01.10.2005 By Demand Draft No. on 150.00 Dr. 4975.00

“x” Branch
To debit account of 85.00 Dr. 5060.00
Ranchi Branch

Draft Payable Ledger (Subsidiary Ledger)

Date Particulars Debit Credit Dr/Cr Balance

30.09.2005 By Balance 750.00 Cr. 750.00

Receipt Scroll Book

Date Voucher Name Amount

Serial No.
01.10.2005 1 Mr. A 100.00
Total 100.00

Payment Scroll Book

Date Name Amount Token Clerk Initial Cashier

No. Officer
01.10.2005 Mr. A 25 2 x xx xx

Receipt Scroll Book

Date Voucher Name Amount

Serial No.
01.10.2005 1 Mr. A 100.00
Total 100.00
26
 Book Maintained by Cash Department

CASH RECEIPT BOOK

Date Scroll Name Denomination Total

No.
01.10.2005 1 Mr. A 100.00
Total 100.00

CASH PAYMENT BOOK

Date Name Token No. Denomination Total

01.10.2005 Mr. A 2 25.00
Total 25.00

Cash Transfer Book

Date Debit Amount Credit Amount

01.10.2005 Mr. A 75.00 Mr. B 75.00
Ranchi Br./ 85.00 Mr. C 85.00
Customer a/c
Outward Bills for 60.00 Liability for 60.00
Collection Outward Bills for
collection
Do 45.00 Do 45.00
Mr. F 150.00 Head Office “X” 150.00
Branch
TOTAL 415.00 TOTAL 415.00

Daily Cash Balance Book

Date 01.10.2005
Last Day’s Balance 500.00
Received Today
Cheques 415.00
Cash 100.00 515.00
1015.00
27
 Paid Today
Cheques 415.00
Cash 25.00 440.00
Cash Balance 575.00
Particulars
Reserve Bank Of India Notes
No. of Pieces Denomination
Xx
Rupees Note

Total Cash Balance 575.00

____________________________________
Cashier
When Checking the Cash Balance Book:
(i) The last day's balance (marked "A") should be checked (and should agree)
with the previous day's closing cash balance.
(ii) The amounts "B" (received today ___cheques) and "D" (paid today ___
cheques) are identical amounts. They represent the totals of Credit side and
Debit side of Cash Transfer Book respectively and should be checked (and
should agree) with the Cash Transfer Book.
(iii) The amount "C" (received today cash) should be checked (and should agree) with
the Cash Receipt Book.
(iv) The amount "E" (paid today cash) should be checked (and should agree) with the
Cash Payment Book.

Note: The total of Cash Receipt Book should also agree with the total of Receipt
Scroll Book. The total of Cash Payment Book should also agree with the total of
Payment Scroll Book.

Cash Book
Credit Debit
Date Particulars Amount Date Particulars Amount
01.10.2005 Current 260.00 01.10.2005 Current 250.00
Deposits Deposits
Draft Payable Outward Bills
Liability for for Collection
Outward Bills 60.00 105.00
for collections
60.00 105.00 45.00

45.00
28
 Head Office 150.00 Head Office 440.00
Cash Last 500.00 Cash in hand 575.00
Balance
Total 1015.00 Total 1015.00
*This total of all credits of the day must agree with the total marked "I" (Received to-
day) in the Daily Cash Balance Book shown on page 21.

**This total of all debits of the day must agree with the total marked "II” (Paid to-day)
in the,Daily Cash Balance Book shown on page 21.
The object of checking and agreeing the totals of credit side of the Cash Book with
the total of ‘Received today' of the Daily Cash Balance Book, and of checking and
agreeing the totals of debit side of the Cash Book with the total of "Paid to-day" in
the Daily Cash Balance Book is to ensure that all transactions passed through

i) Cash Receipt and Cash Payment Books and

ii) Cash Transfer Book have been accounted for in the Cash Book.

Accounts in the General Ledger

General Ledger A/c State Bank of India

Date Particulars Debit Credit Dr./Cr. Balance

Rs. Rs. Rs.

30-9-05 To Balance 300 Dr. 300

01-10-05 To 250 Dr. 550

General Ledger A/c Cash

30-9-05 To Balance 500 Dr. 500
01-10-05 To 515 Dr. 1,015
By 860 Dr. 155

General Ledger A/c Current Deposits

30-9-05 By Balance 5,000 Cr. 5,000

01-10-05 By 260 Cr. 5,260
To 250 Cr. 5,010

General Ledger A/c Head Office

30-9-05 To Balance 5,125 Dr. 5,125

1-10-05 To 85 Dr. 5,210
By 150 Dr. 5,060

29
 General Ledger A/c Drafts Payable
Date Particulars Debit Credit Dr./Cr. Balance

30-9-05 By Balance 750 Cr. 750

01-10-05 To 170 Cr. 580

General Ledger A/c Liability for Outward Bills for Collection

30-9-05 By Balance 2,000 Cr. 2,000
1-10-05 By 105 Cr. 2,105

General Ledger A/c Outward Bills for Collection

30-9-05 To Balance 2,000 Dr. 2,000

1-10-05 To 105 Dr. 2,105

General Ledger A/c Guarantees Issued

30-9-05 By Balance 2,000 Cr. 2,000

General Ledger A/c Customers' Liability for Guarantees Issued

30-9-05 To Balance 2,000 Dr. 2,000

General Ledger A/c Stamps and Stamped Documents in Hand

30-9-05 To Balance 25 Dr. 25

General Ledger A/c Profit & Loss

30-9-05 By Balance 200 Cr. 200

General Ledger Balances as on 01.10.2005

Liabilities Amount (in Assets Amount (in
Rs.) Rs.)
Current Deposits 5010.00 Head Office 5060.00
Add: Overdrafts 200.00 5210.00
Draft Payable 750.0 Cash 575.00
Liability for Outward Bills for 2105.00 State Bank of India 300.00
Collection
Guarantees issued 2000.00 Overdrafts 200.00
Profit & Loss (Profit) 200.00 Stamps and Stamped 25.00
Documents in Hand
Outward Bills for Collection 2105.00
Guarantees issued 2000.00
Total 10265.00 Total 10265.00

Contingent Liabilities
Liability which has not arisen but which may arise on happening of a certain event
is contingent liability. It may be regarded as a potential liability which will either
develop into full-fledged liability or will be eliminated entirely by happening of a
subsequent event.
30
 The contingent liability may or may not involve payment of money. The contingent
liability is a mere record until happening of a certain event; when it is crystallized,
the liability is determined. For example, when the Bank issues a guarantee on behalf
of a customer, there is no immediate liability of payment; the liability materializes
when the Bank is called upon to make payment and pays the amount of guarantee
to the beneficiary.

In order to know the total commitment in respect of contingent liability of guarantees

issued, the following contra vouchers are passed:
Debit: Customers' Liability for Guarantees Issued
Credit: Guarantees Issued.

The contra vouchers for liability and asset are necessary to meet the requirements of
double entry bookkeeping. As the amount of contingent liability is equal to the
corresponding asset, the liability is set off against the corresponding asset, without
affecting the other assets of the Bank.

On extinction of the liability (that is to say, on expiry of the validity period of guarantees
or on payment of the amount of guarantees to beneficiary) the entries of liability are
reserved to reduce the liability.

Note: As a security for the liability of guarantees, the Bank obtains, inter alia, stamped
undertakings (counter-guarantees) from customers to reimburse the Bank, when
called upon to do so.

Liability for Outward Bills for Collection

When inland documentary bills are received (from customers and other banks) for
collection, the detailed records are kept in the Register of Bills Sent for Collection
(Outward). Liability vouchers for the amounts of these bills (sent out for collection)
have to be passed which are posted in two General Ledger Accounts __ Liability for
Outward Bills for Collection" (Liability) and "Outward Bills for Collection" (Asset). The
balance in the General Ledger Account "Liability for Outward Bills for Collection (a
credit balance) is always equal to the balance in the General Ledger Account
"Outward Bills for Collection” (a debit balance). Strictly speaking, there is no liability
for or asset of the Bank for these bills similar to those of deposits or advances. The
General Ledger Accounts help in keeping track of outstanding bills.

When the bills are received for collection, the following vouchers are passed:

Debit: Outward Bills for Collection

Credit: Liability for Outward Bills for Collection.

These entries are reversed when the bills are realized.

Balancing of Outward Bills for Collection Account

Since the purpose of maintaining the Contra General Ledger Accounts of Bills for
31
Collection is to have a check on the outstanding bills, it is necessary to agree
periodically (at least once a month) the total amount of bills outstanding in the Register
of Bills Sent for Collection (Outward) with the balance in the General Ledger Account.
(The amount of each outstanding bill from the Register is entered in a Balance Book
and such amounts are added up to arrive at the total amount of bills outstanding as
per Register).

Since, we are on CBS platform, hence, all entries/outstanding bill wise amount
should be tallied/reconciled/balanced with the register & GLB. Proper
monitoring and follow up of all outstanding bills should be done by the branch
on regular basis.

Liability for Inward Bills for Collection

A record of the outstanding inward documentary bills held by a Branch (payable at the
place where the Branch is established) is kept in the General Ledger Accounts
"Liability for Inward Bills for Collection" (Liability) and “inward Bills for Collection"
(Asset).

When inward bills are received for collection, the following vouchers are passed:

Debit: Inward Bills for Collection

Credit: Liability for Inward Bills for Collection.

These entries are reversed when the bills are paid by the drawees.

Since, we are on CBS platform, hence, all entries/outstanding bill wise amount
should be tallied/reconciled/balanced with the register & GLB. Proper
monitoring and follow up of all outstanding bills should be done by the branch
on regular basis.

Note: For further information, refer to the chapter on "Inward Bills for Collection".
Clearing House

FOR CLEARING PROCEDURE AT NET CLEAR CENTRES PLEASE REFER TO

PAGE 33 AND ALSO CHAPTER II.

At some remote centers/small towns, clearing house is being maintained

manually,

Where CTS (Cheque Truncation System) is not implemented.

Customers of banks deposit in their accounts cheques drawn on other banks Cheques
payable at upcountry centers are sent to upcountry Branches or banks for collection,
cheques payable by banks at the center are sent to Clearing House for realization. At
32
the Clearing House, each bank presents to other banks cheques drawn on them and
receives the cheques drawn on it (presented for payment by other banks). The
Clearing House facilitates the settlement of amounts of cheques thus receivable and
payable by each bank.

Every bank sorts the cheques bank-wise (drawn on other banks) and lists their
amounts.

Representatives of the banks meet at the Clearing House and deliver to each other
the cheques (together with the lists) drawn on their banks. Accounts of the amounts
receivable from and payable to each member bank are settled at the Clearing House
and thereafter the representatives take the cheques received at the Clearing House
to their banks for posting in the accounts of their customers.

At various other places, Centralized Clearing House system is going on, where
CTS is implemented.
The following illustration shows how banks settle their accounts with the Clearing
House:
There are three banks, A, B and C at a center Representative of each bank delivers
the cheques drawn on the other two banks as follows

Rs.
A bank representative delivers cheques on B bank for 2,000
A bank representative delivers cheques on C bank for 1,200

Total amount receivable by A bank 3,200

B bank representative delivers cheques on A bank for 3,700

B bank representative delivers cheques on C bank for 800

Total amount receivable by B bank 4,500

C bank representative delivers cheques on A bank for 300

C bank representative delivers cheques on B bank for 1,800

Total amount receivable by C bank 2,100

A bank representative receives cheques payable by his bank from B bank 3,700
A bank representative receives cheques payable by his bank from C bank 300

Total amount payable by A bank 4,000

B bank representative receives cheques payable by his bank from A bank 2,000
B bank representative receives cheques payable by his bank from C bank 1,800

Total amount payable by B bank 3,800

C bank representative receives cheques payable by his bank from A bank 1,200
C bank representative receives cheques payable by his bank from B bank 800

Total amount payable by C bank 2,000

The banks A, B and C instead of paying and receiving the amounts to and from each
33
other pay/ receive the difference to/from the Clearing House

The banks have to pay and receive the following amounts

A Bank B bank C Bank

Rs. Rs. Rs.
Amount to be received 3,200 4,500 2,100
Amount to be paid 4,000 3,800 2,000
To Pay 800 To receive 700 To receive 100

The Clearing House receives Rs. 800 from A bank and pays out of it Rs. 700 to B
Bank and Rs. 100 to C bank. (The Reserve Bank of India manages the Clearing House
at places where it has its offices. At other places the Clearing House is managed by
the State Bank of India or by one of its associates).

Outward and Inward Clearing Cheques

For a bank, the cheques drawn on other banks and delivered (to them) at the Clearing
House are called "Outward clearing cheques". Similarly, the cheques drawn on itself
and received from other banks at the Clearing House are called "Inward clearing
cheques".

Branches are required to do balancing/reconciliation of Net Clear Account,

Clearing Adjustment Account, Accounts maintained with other Banks & other
Bank’s Accounts maintained with the branch, on daily basis. Proper monitoring
& follow up, in regard to all outstanding entries, must be done on regular basis.
It should be noted that the "Net Clear/Clearing Account" should have a nil
balance at the end of the day.

Outward and Inward Clearing at Centers where the Bank has more than one
Branch

After preparing bank-wise lists of Outward clearing cheques and entering the particulars
of cheques in Clearing Cheques Register, a Branch forwards the lists and the cheques to
the Main Office at the Center together with a Debit Note for the total amount of cheques
sent. The following vouchers are passed at the Branch.

Debit: Head Office Account Main Office

Credit: Customers' Accounts (Customers deposit cheques pinned to

the paying-in-slips. The paying-in-slips are credit vouchers.
The attached cheques are sent to Clearing House).

34
The Main Branch sends Inward clearing cheques of the Branch under a Debit Note
for the total amount of Inward clearing cheques drawn on the Branch. The Branch
passes the following vouchers:

Debit: Customers' Accounts (The cheques received in Clearing

along with Debit Note of Main Branch are debit vouchers and
are posted (debited) to customers' accounts)

Credit: Head Office Account Main Office

At the Main Branch, the Outward clearing cheques received from the Branch together
with the Outward clearing cheques; of the Main Branch are sent to the Clearing House.
The following vouchers are passed:

Debit: General Ledger Account “Clearing"

Credit: Head Office Account Branch (by the amount of the Outward
clearing cheques of the Branch)

Credit: Customers' Accounts (at Main Branch) (by the amount of Main
Branch Outward clearing cheques).

When Inward clearing cheques are received from the Clearing House, the following
vouchers are passed:

Debit: Customers' Accounts at Main Branch (for Inward clearing

cheques of Main Branch)

Debit: Head Office Account Branch (for Inward clearing cheques of

the Branch)

Credit: General Ledger Account “Clearing".

At the Main Branch vouchers of Outward and Inward clearing cheques are posted in
the General Ledger Account “Clearing”. After posting the vouchers of outward and
Inward clearing, if this account has a debit balance, the clearing is in favor of the Main
Branch (i.e. Main Branch has to receive the amount from the Clearing House). If the
account has a credit balance, the clearing is against the Main Branch (i.e. the Main
Branch has to pay to the Clearing House).
The following vouchers are passed at the Main Branch:

(a) When there is debit balance in the General Ledger Account "Clearing”:

Debit: General Ledger Account "Reserve Bank of India/State Bank of

India" Credit: General Ledger Account "Clearing".

(b) When there is a credit balance in the General Ledger Account "Clearing":
35
 Debit: General Ledger Account "Clearing".
Credit: General Ledger Account "Reserve Bank of India/State Bank of
India".

It should be noted that the "Clearing Account" should have a nil balance at the end
of the day.

(At centers where there is only one Branch of the Bank, the Branch passes vouchers
described for Main Branch for its own cheques).
At various other places, Centralized Clearing House system is going on, where
CTS is implemented.

Accounts of Branches with Head Office

Maintained through the finacle/system and all posting/transactions are done on

double entry accounting principle.

Head Office maintains separate account of every Branch to record the transactions
between Head Office and Branches and those between the Branches.

When Head Office Account at a Branch shows a credit balance, the Branch has
"borrowed" from Head Office and when it shows a debit balance, the Branch has "lent"
to Head Office. On its borrowing from or lending to Head Office, a Branch has to pay
to or receive interest from Head Office.
Inter-Branch Transactions
Demand Draft etc. are issued by posting the transactions through
finacle/system on double entry accounting principle.

When a Branch issues a demand draft, a mail transfer, a telegraphic transfer or remits
proceeds of bills collected funds are transferred from one Branch to another. (There
is, of course, no physical transfer of funds; the transfer is by entries in Head Office
Account of a Branch).The following vouchers are passed at the Branch where the
transaction emanates:

(a) If a customer pays cash for purchase of a demand draft, mail transfer or
telegraphic transfer: Credit: Head Office Account of the Branch to whom
funds are transferred. (As this is a cash transaction, only one voucher __
credit__is passed; the corresponding debit is the entry in Cash Receipt
Book).

(b) If a customer instructs the Branch to debit his account:

Debit: Customer's Account
Credit: Head Office Account of the Branch to whom funds are transferred.

The credit voucher gives the particulars of the name of the Branch (with code number)
36
to whom funds are transferred, the names of payee and remitter and the amount.

Maintained through the finacle/system and all posting/transactions are done on

double entry accounting principle.
Reconciliation of Inter-Branch Transactions at Head Office
Maintained through the finacle/system and all posting/transactions are done on
double entry accounting principle.

Balancing of Ledgers

(Current Accounts, Savings Bank Accounts, Cash Credit Accounts, etc)

Now, being maintained through finacle/system.

Financial and non-financial transactions are posted/done by a staff through

biometric authentication/system/ system identification procedure and under
his/her PF code & password etc. within his/her delegated user work class. And
these transactions are verified by the officials through biometric
authentication/system/system identification procedure and under his/her PF
code and password etc. within his/her delegated authority. Dual control
mechanism etc. must be followed up as per Bank’s latest guidelines.
Standard Operating Procedure (SOP) must be followed up, for physical
checking/verification of all vouchers with the system generated related reports,
on daily basis, with reporting to competent authority, under compliance norms.

It is necessary to find out periodically, whether the amounts of credit and Debit
vouchers are correctly posted and whether the balances are extended correctly.
Please also refer to the Chapter on "Deposits-General"
All the vouchers are posted in the respective accounts, through finacle, as per
double entry accounting principle, and after verification, these amounts are
summarized/grouped in respective heads of GLB ( General Ledger Balance),
through General Ledger Accounts of each respective heads, viz. SB, CD, DBD,
RD, CC, OD, Loan etc. Hence, the totals of all credits and debits are added by
the system, on the day, the books are balanced. At the end of the day, finally,
all branches closes, all their transactions/books/accounts, through CSOLOP
(Close SOL Operations) and thereafter, for closing/finalizing of all
transactions/books/accounts is completed/done by the Data Centre, through
centralized CSOLOP of the Bank, as a whole.
The following illustration shows, how the “balance” is
arrived in an account: Illustration:

Account No. ....... Name of Account ......... Address & Phone no........etc.
Date Particulars Chq. No Debit Credit Balance

01.01.2019 By Cash 12,000 12,000 (Cr)

17.01.2019 To Ramesh 98723 4,000 8,000 (Cr)
37
 05.02.2019 By Interest Feb, quarter 22 8,022 (Cr)

These notes are based on principles of Book-keeping. Although the procedures

recommended have stood the test of time and are generally followed in the
Bank, it is conceivable that there may be other procedures which confirm to
such principles and are, therefore, equally valid. ' These notes, therefore, do not
form a part of the Manual of Instructions but are printed here for general
guidance particularly of those Bankmen who do not have the necessary
background of Book-keeping but desire a working knowledge of the Book-
keeping procedures in the Bank.
CHECKING AND INITIALLING IMPORTANT BOOKS OF THE BANK
1. The purpose of initials of officers in ledgers, registers and other books of the
Bank is (i) to indicate that the items entered/deleted in the books have been
authorized and checked or verified and (ii) to identify the officers who checked
or verified them.
Transactions/postings (financial & non-financial) are verified by the
officials through biometric authentication/system/system identification
procedure and under his/her PF code and password etc. within his/her
delegated authority. Dual control mechanism etc. must be followed up as
per Bank’s latest guidelines.
Standard Operating Procedure (SOP) must be followed up, for physical
checking/verification of all vouchers with the system generated related
reports, on daily basis, with reporting to competent authority, under
compliance norms.

2. As rule, officers should, in token of their having checked the items, initial against
them; they should also initial any cancellations, corrections, alterations, etc.,
made in the books of the Bank to signify the authenticity of such cancellations,
corrections, alterations, etc. Overwriting of figures must be scrupulously avoided;
alterations in the figures should be made by scoring out the entire wrong figures
neatly and entering the correct figures above them.

3. Ledger

But, at the time of opening of an account, all particulars/details, such as titles

of accounts, addresses, contact numbers, e-mail ids, names of account
holders, partners, directors, power of attorney holders, etc., special
instructions regarding operation on accounts (either or survivor, jointly, etc.),
instructions of stop payment of cheques, Interest Table code, Occupation
Code, Activity Code, and in credit accounts, besides abovesaid - BSR Code,
(MIS codes ), securities details, limit details, review details etc , must also be
correctly feeded through the system.
3. Registers ( maintained in finacle)

But, some registers are also maintained manually, to have better control and
monitoring.
38
 (1) Cheque Book Delivery Register (2) Cheque Returned Book

Register of Temporary Overdrafts,

(3) (4) Register of Stop Payment Cheques
TOL
(5) Stock, Book Debts Register (6) Register of Insurance Policies

(7) Mortgage /Title Deeds Register (8) Postage Books, Despatch Register

(9) Register of Furniture and Fixtures (10) Proposal Register

Suit Filed , Legal Action Taken

(11) (12) Loan application recd register
Register
(13) Govt Subsidy, Margin Money recd register

Control over General Ledger Account Sundry Deposits', 'Sundry Credits’ and
'Suspense Accounts (Debits)'

No new account should be opened under these 3 heads by the branch. Any new
office account should be opened by HO-DC(IT) only, with the specific approval
of concerned Functional Dept. & counter signed by HO-GOD.

Proper and meticulous follow up, monitoring and reconciliation must be done
on regular basis for all outstanding entries in all these 3 office accounts/heads.

The Branch Manager or Designated Manager/Senior Manager at larger Branches

should personally verify all the debit vouchers of the day posted in these accounts.

Sundry Deposits account "Unknown Depositors":

Sundry Deposit Accounts (SUNDEP): It is maintained for amounts of deposit
(credit balances) nature that are not specifiable by any account number
immediately. Such amounts are parked here for temporary period, pending
their final identification/classification/ - accounting. e.g. provision of half-yearly
interests on FDR, Margin moneys of L/Cs, Unclaimed Balances, Unknown
Deposits etc.

However, there are occasions when the title of an account/account number on paying-
in-slip differs (or is incomplete) from the title of an account/account number maintained
at the Branch. In such cases of doubt about the name of an account for which the
amount is meant, enquiries should be made in the different Departments so as to find
out whether the amount pertains to any account with them; otherwise, the amount
should be held in Sundry Deposits Account “Unknown Depositors". The full particulars
of such deposits such as form of deposit i.e., cash/ cheque (if cheque, its number,
bank drawn on, etc.), paying-in-slip number and account number, if any, should be
recorded in "Particulars' column of ledger account. It should be followed by a suitably
worded letter addressed to the account holder (Form CD 89) without disclosing the
amount, asking him if he has deposited any amount on that date and if so, to produce
the counterfoil. It must be seen that the number on the counterfoil and the handwriting
39
agree with those on the paying-in-slip. When the correct title of the account is
ascertained/known, the relative amount would be credited to the appropriate account
by debit to the captioned account and a fresh balance struck. The entries so
transferred from the account should be suitably marked off.

Before reversing the abovesaid entries, genuineness of the transactions and

identity of the beneficiary must be ensured/verified and proper due diligence
and care should be done.

Sundry Deposits Account "Dormant Accounts": All withdrawals from Dormant

Accounts should be permitted only under the signatures of two authorized officials,
one of whom must be the Branch Manager (or in the case of larger Branches,
Designated Manager/Senior Manager). Proper due diligence and care should be
done.

Sundry Deposits Account "Excess Cash Received/Cash found on counters"

etc.: Excess cash received/cash found on counters, etc., should be credited to Sundry
Deposits Account “Excess Cash Received and the matter should be reported to Head
Office, through proper channel, on the same day. The balance held in this account
should be transferred to the Comptroller’s Department, Head Office after one year
from the date of receipt of such cash at the Branch. While transferring the amount to
Head Office, full particulars of the transaction should be furnished. It should also to
be reported to the next higher authority.

Sundry Credit Accounts (SUNCR):

It is maintained for credit balances that do not pertain to deposits. Such amounts are
parked here for temporary period pending their final accounting/transfer to right heads
of account e.g. Provision for various expenses accrued but not paid, URI of NPA
accounts, LIC Premium of staff, GST Collection account, Auction sales proceeds etc.
Debit Balances in “GENSUS/Suspense Account (Debits)":

It is maintained for debit balances which pertain to many heads of expenditure that
are immediately unclassifiable pending their actual incurrence/recovery. Such
amounts are parked here for temporary period, mainly related to expenses of advance
nature e.g. Festival Advance to staff, Pension paid pending recovery from the PPAs,
various Advances withdrawn for purchases, etc.

As may be observed, the various accounts opened in these 3 G/L heads are supposed
to be intermediate & temporary in nature and thus call for to be squared-up over time
( within a reasonable time) by transferring the entries therein to the proper heads of
account upon due reconciliation of entries. As a natural corollary, these G/L Heads
should have minimal outstanding entries.
Branch Managers to have authority to debit and continue entries in G/L Suspense
Account for a period of 30 days, extendable to 60 days with ZM's approval & beyond
60 days with NBG-GM's approval and under advice to HO Respective Functional
Department (RFD) and GOD for noting & monitoring. Proper follow up, monitoring and
reconciliation of all outstanding entries, should be done on daily basis.
40
Further, the accounts as well as entries in these G/L Heads are either 'Pointing Type'
(PT, system reference is OAP) or 'Non Pointing Type' (NPT, system reference is OAB).
 A PT account/entry is one which requires the date of original entry at the time of
subsequent credit or debit (as the case may be) for matching/reconciling purpose,
thus prompting the user to trace the origin of the entry and set off/ square-up the
same with the current entry. PT accounts give age-wise breakup of outstanding
entries.
 A NPT account/entry is one which does not require the date of original entry for
matching/reconciling. NPT accounts do not give age-wise breakup of outstanding
entries and hence these accounts should be closed in a phased manner.
Note: Branches to scrutinize/ensure that no outstanding debit balances should
reflect at day-end in SUNDEP and SUNCR accounts, nor any outstanding credit
balances in GENSUS accounts. Such balances/entries require immediate
attention and need to be rectified.

These should be subjected to the same control as is exercised over other advances
accounts. All accounts showing debit balances should be periodically checked by the
Branch Manager (at larger Branches by the Designated -Manager/Senior Manager)
and suitable action initiated to adjust them. For example, amount of expenditure,
originally debited to Suspense Accounts (Debits) but chargeable to Branch or Head
Office Profit and Loss Account, should be transferred to the appropriate Profit and
Loss Account. Similarly, where customers in whose accounts instances of frauds,
embezzlements were detected, have been reimbursed to debit of Suspense Accounts
(Debits), instructions should be sought from the controlling authorities about the
adjustment of such debit balances.
Periodical Balancing of the Ledgers: In addition to the fortnightly balancing of these
office accounts, proper follow up, monitoring and reconciliation should be done
on daily basis.

For the purpose of exercising control over these accounts, the nature of accounts,
the amount outstanding and the age of accounts have also to be taken into
consideration rather than merely the number of such accounts.

Net Clear System

At 29 Service Branches and 11 Main Branches the Net Clear System has been
introduced. Net Clear is the accounting system under which local clearing branches
under a service branch will not draw or issue Debit Notes or Credit Notes on another
local Branch or on the Service Branch for any transaction, viz., clearing and
remittances including remittance of cash. The Service Branch will only draw Debit
Notes/Credit Notes on such Local Branches for the net amount of all their daily
transactions with Service Branch as well as other Branches. It follows that Branches
participating in local clearing under any particular Service Branch will come under the
scope and fold of net clear.

Under the system outward clearing instruments are forwarded by the local branches
to the Service Branch under an Outward Memo. Inward Clearing instruments are in
41
turn forwarded under an Inward Memo by the Service Branch to the local branches.
All remittances between the local clearing branches are conducted by means of Credit

Orders/Debit Orders and these are accounted through the Service Branch.

It is very essential that each Branch should reconcile its entries with the Service

Branch. Branch should ensure that the entries in the Net Clear Document are squared

off/reconciled on the same day or within two/three days.

Differences if any should be followed up and settled at the earliest.

***

42
 CHAPTER 2
DEPOSITS - GENERAL
Introduction
1.1 One of the important functions of the Bank is to accept deposits from the public for
the purpose of lending. A depositor, depending upon his convenience and special
requirements, may open accounts of different categories. The common features and
essential preliminaries concerning different categories of deposit accounts are listed
hereafter.

1.2 All staff members must get themselves thoroughly acquainted with the Bank's rules
of business for various types of deposits and with the Reserve Bank of India directives
on the subject of rates of interest etc. They should also keep abreast of any
amendments/changes therein from time to time.
Please also refer to our Bank’s Deposit Policy and the amendments/ changes/ revision
from time to time.

Please follow KYC and AML guidelines/norms/policy and Central KYC registry
guidelines along with CKYC operational Guidelines.

Branches are also advised to visit Stardesk e-daftary for downloading the New
Account Opening Form (Appendix I) and one pager Application Form required in
CKYC Process. (Appendix II)

I.TYPES OF ACCOUNTS

Accounts of Individuals (Single)

2. This is purely a personal account in the name of an individual and is normally

operated upon by the account holder himself. The account holder may authorise
another person to operate on his account. For this purpose, he gives a Mandate or
executes a Power of Attorney in favor of such a person. Ordinarily, any person may
open only one account in his name under each type of deposit account. When two
accounts are opened in the name of the same person for any special purpose, one
account should be distinguished from the other account by using some suffix viz , Mr
XYZ Account 'A' and Mr XYZ Account 'B' etc. Accounts in personal names indicative of
trusteeship capacity of account holders should not be opened. For instance, an account
in the name of Mr XYZ account "Saraswati Vidyalaya" or account "Panjarapole"

3. In order to avoid legal complications that may arise after the death of the account
holder, it is desirable to suggest opening of a joint account in the names of two
individuals (unless it is essential in certain circumstances to open an account in the
43
single name only), and/or to obtain proper nomination. Please refer para 13, 14, 15, 16,
& 17 for details on nomination.

RBI has directed banks to treat “Transgender Persons” as third gender and
include as “third gender” in all forms/applications etc., wherein any gender
classification is envisaged. The salutation of such person shall be "Mx". All
transgender customers shall be treated equally to other male/ female customers
without any discrimination.
JOINT ACCOUNTS OF INDIVIDUALS
4.1. A joint account is opened in the names of more than one individual for convenience
of operations and/ or to avoid legal complications upon death of one of the joint account
holders. A joint account is neither a partnership nor a trust account. It is important to
obtain clear and unambiguous instructions regarding the mode of operation and
repayment of balance of a joint account in the event of death of one or more joint
account holder(s). Authority of the joint account holder to operate a particular deposit
account is restricted to operation on that account only and does not automatically
extend to other account, such as, a safe custody account or an overdraft
account, nor does it make any party to the account responsible for an overdraft created
in that joint account by the other(s) One or more of the joint account holders can
authorize operation on the account on his/their behalf by giving a Mandate or executing
a Power of Attorney, but, such Mandate or Power of Attorney must be given by ALL the
parties to the accounts.

4.2. An account may be in the name of one person or in the names of two or more
persons, arrangements can be made for one or more persons to operate upon the
account and the balance to be paid to the survivors or survivor. The mode of operation
of a joint account after it is opened can be altered ONLY with the consent of ALL the
joint account holders. The Bank will not be bound to act on the instructions of one or
some of the joint account holders regarding such alteration.

4.3. While there are no restriction on the number of account holders in a joint account,
it is incumbent upon the Bank to examine such request vis-a-vis the purpose, nature of
business of account holders with its relevant aspects, their financial position etc.

4.4 All the accounts holders should be advised to sign on the Terms and
conditions-cum -undertaking cum declaration on Account Opening Form
Appendix I

Operations on Accounts
5.1. Instructions regarding operations on a joint account can take any one of the
following forms:
Account in the name of Mode of Operations
A&B Either or Survivor
A&B Both of us jointly or Survivor
A, B, C, D, E, ETC. Anyone/two or more of us or anyone/two or
more of the survivors of us or the survivors
44
 of us or the last survivor
A&B Former or Survivor (Also refer paragraphs 8
to 11)
A, B & C Former or Survivors (Also refer paragraphs
8 to 11)
(Note: For accounts in the name(s) of minor(s), please refer to instructions given under
"Accounts of Minors")

5.2. Joint account holders should be advised to write the full title of the account on all
cheques and paying-in-slips for easy identification of the account. They may be
requested to use a rubber stamp indicating the full title, i.e. the names of all the joint
account holders.

5.3. Unless there are instructions to the contrary, cheques or orders to pay on a joint
account should be signed by all the parties to the account.

5.4. Upon the death of one of the joint account holders, where operational/repayment
instructions are either by "Either or Survivor" or by "Jointly or Survivor", the right to
operate the account and entitlement to the balance in the account vests with the
surviving account holder. In a joint account of more than two persons, where the
operational/repayment instructions are "any one/two (or more) of us or any one/two (or
more) of the survivors of us or the survivors of us or the last survivor", upon the death
of one of the account holders, the right to operate the account and entitlement to the
balance in the account vests with the remaining (i.e. surviving) account holders in
accordance with operational instructions specified.
Revised Account Form (Page 4) includes the above mandates. Branch has to take
sign of all account holders while opening the account as per Appendix I.

5.4A Joint holders of the term deposit with ‘Former or Survivor’ or ‘Either or Survivor’
clause should give a specific mandate to the Bank, if they desire premature payment of
the deposit amount to the survivor/survivors in case a joint holder dies before the
maturity of the deposit.

The joint deposit holders may be permitted to give the mandate either at the time of
placing fixed deposit or anytime subsequently during the term/tenure of the deposit. If
such a mandate is obtained subsequently it should be as per standard format. If the
parties are desirous of giving the mandate while opening the deposit itself, the following
MANDATE should be added in the Deposit account opening / additional deposit account
opening form invariably:

‘We would like to further clarify and declare that in the event of death of anyone or
more of the joint depositors , the surviving depositors shall be within their rights to
request the Bank for premature payment of the said deposit without obtaining the
consent or discharge from the heirs/executors/successors of the deceased depositor.’

5.4B Revised Account Form includes the above mandates. Branch has to takes sign of
all holders while placing deposit.
45
 Accordingly, we hereby authorize the Bank to make premature payment of this term
deposit to the surviving joint depositors, if so requested by them, without insisting on
No Objection Certificate / discharge from the legal heirs /executors /successors of the
deceased and any such payment made shall be a valid discharge to the Bank.

This mandate is being issued on our full responsibility and shall bind our successors,
executors and heirs as well as shall continue to hold good for renewal of the said deposit
from time to time.

If such a mandate is obtained, branches can allow premature withdrawal of term/fixed

deposits by the surviving depositor without seeking the concurrence of the legal heirs
of the deceased joint deposit holder. Such premature withdrawal upon death of the
account holder, would not attract any penal charge.

Variation in Operational Instructions

6. Instructions regarding operations on the account given at the time of opening a joint
account can be varied only by the account holders jointly and Branches should not
accept variation in such instructions unless authorized by ALL the parties to the account
(Also refer paragraph 9).

Objections by One Account Holder to Operations by Another

7.1 When a Branch receives a letter from any one, two or more joint account holders to
the effect that the Bank should not allow operations by the remaining account holder(s),
a letter should be addressed jointly to all the account holders stating that the Bank has
received an intimation from one (or more) of the account holder(s) that the account
should not be allowed to be operated by the other(s) of them; that in view of the dispute
that has arisen between the account holders, the Bank would desire to close the
account unless it is operated and the cheques are signed by all the account holders
jointly; that the Bank should receive within a specific time a written intimation from the
account holders signed by all of them that they are agreeable to the account being
operated by all of them jointly; that if the Bank does not receive such intimation within
the specified time, the Bank would close the account and issue a pay-slip in favor of all
the account holders, which when presented for payment should be discharged by all of
them.
7.2 In specifying the time in such letter, regard should be had to the time taken for the
Bank's letter to reach the account holders and time taken for their letter to reach the
Bank, allowing a couple of days for their consideration and further action.

7.3 The joint letter must be addressed to the address of the account holders as
appearing on the record of the Bank. If the Bank is officially aware that one or more
account holder(s) has or have different address (es), copies of the joint letter must be
posted to those addresses also.

7.4 If, by the time so specified in the joint letter, all the account holders do not agree as
required therein, whether or not some may have agreed, the account should be closed
46
and a pay-slip drawn in favor of all the account holders should be issued and sent with
a covering letter addressed to all the account holders at the address on record with the
Bank. Copies of the letter should be sent to other account holders if the Bank is officially
aware that they have different addresses.

7.5 The pay-slip issued as above should be paid only if it is discharged by all the joint
account holders.

7.6 Between the time of the receipt of intimation from the objecting account holder(s)
and the closing of the account as above, if any cheques drawn in terms of the original
instructions are presented, they should be paid even though in so doing, the balance
may be substantially reduced or even brought to Nil.

Accounts to be operated by "Former or Survivor"

(a) Operations on Accounts

8.1 Joint account in the names of two account holders 'A' and 'B' may be opened to be
operated upon by "Former or Survivor". The instructions "Former or Survivor" convey
that the account will be operated upon by the former 'A' alone, so long as he is alive
and after his death, by the survivor 'B'. 'B' is not to operate the account during the
lifetime of 'A'. 'B' can operate the account after the death of 'A'. If 'B' dies first, the
account is to be operated upon solely by 'A' and the legal representative of 'B' will have
no right to the balance in the account or to operate the account. Only the legal
representative of the last account holder to die is entitled to the balance in the account
[Also refer paragraph 100.1(b)].

8.2 Similarly, joint account in the names of three account holders 'A', 'B' and 'C' may be
opened to be operated upon by "Former or Survivor" where the following modes
Of operation may be allowed.
So long as 'A' is alive, he or she will be the
'A' only, after his/her death, only person entitled to operate, after his or
i) jointly by 'B' and 'C' or the her death the operation will be by 'B' and 'C'
survivor of them, jointly, and one of them is not alive, then by
the survivor.
The account will be operated by 'A' alone
'A' only, after his/her death, so long as he or she is alive, after his or her
II) by either or survivor of 'B' death, if 'B' and 'C' are both alive either can
and 'C' operate, if one 'B' or 'C' is already dead, the
survivor can operate.
'A' will operate so long as he or she is alive,
'A' only, after his/her death
after his or her death, only 'B' will operate if
III) by 'B' only if alive or by the
he / she is alive only, after 'B's death or if 'B'
survivor of 'B' and 'C'
has predeceased 'A', 'C' can operate.

(b) Variation or Revocation of the Instructions

47
9. Any variation in or revocation of the instructions "Former of Survivor" must be effected
under the signature of the former account holder only "Former or Survivor"
instructions are normally given with the intention that the "Former" i e the first named
depositor should retain, as long as he/she is alive, full rights to deal with the monies
deposited by him/her and the other depositor(s) i e the "Survivor(s)" should receive and
deal with the monies only after the death of the "Former". Hence, the "Former" alone is
entitled to make any variation or revocation of operational instructions "Former or
Survivor".

(c) Overdrawing of Accounts

10. An account with the instructions "Former or Survivor" should NOT be allowed to be
overdrawn even temporarily. This point should be brought adequately to the notice
of the depositors at the time of opening the account.

(d) Precautions

11. A customer may sometimes wish to open an account which he wants to operate
during his lifetime, but after his death the account is to be allowed to be operated upon
by or the balance paid to another person and that such other person is not proposed to
be a joint account holder An account with such instructions should not be opened.
For instructions regarding payment of balance to another person who is not proposed
to be a joint account holder refer paragraph Nos 13 to 17 on "nomination".

Addition/Deletion of Names in all Deposit Accounts of Individuals

12.1. A- Branch Managers have been authorised to consider request from Account
holder/s for Addition/Deletion of name/s of any person/s in Demand as well as Term
Deposit Accounts without reference to the heirs/legal representative and/or without
obtaining 'No Objection Letter' from the legal heir/legal representatives, subject to the
following:

(i) Where all account holders are alive - upon written request signed by all the account
holders
(ii) Where one of the account holders is deceased - upon written request signed by the
surviving account holder/s provided operational instructions in the account are any of
the following :
(a) Either or survivor
(b) Former or survivor
(c) Any one of them or any one of the survivors or the last survivor

Request for Addition/Deletion of name/s in jointly operated Deposit Accounts, where

one of the depositors is deceased, should be referred to Zonal Manager for necessary
consideration on merits.

While considering such requests, Branches should ensure that:

48
 i The request for addition/deletion of name/s is made in writing duly signed by all
the depositors/ surviving depositors.
ii The signatures of all the account holders on the letter of request are verified
very carefully particularly in the case of deletion of a name and in case of any
doubt, the account holders are contacted and confirmation obtained or
preferably the account holder/s are requested to sign in the presence of the
Manager.
iii The reasons for the addition/deletion of name/s are set out in the letter of
request and that they are cogent.
iv The Branch is satisfied about the bonafide nature of the request.
V A balance confirmation letter as of the date of the request for addition/deletion
is obtained duly signed by all account holders.
vi Details of changes in the account if any in the past are examined.
vii The name of the new depositor is added after the name/s of the existing
depositor/s in order not to contravene Section 269 T (2) of the Income-Tax
(Second Amendment) Act, 1981.

Changes in Records upon Addition/Deletion of Name(s).

Addition

12. 1.B. In the case of addition of a name, although the existing account will continue
with the additional name, a fresh account opening card/form with appropriate
instructions regarding mode of operations, repayment of balance in the account etc,
should be obtained, signed by the present and new account holder(s). The account
number and the date of opening of the original account should also be noted in the new
account opening card/form.

The letter of request, old account opening card/form along with the photographs in
the case of savings bank accounts and Bills Form No 1005(in case of current account),
signed by all the account holder(s), existing as well as new, should be carefully
preserved. In the relative pass book/deposit receipt, the name of new deposit holder
and the date of his inclusion together with variation in operational instructions, if any,
should be appropriately indicated under the full signature of the concerned Officer.

Deletion

12. 1.C. In the case of deletion of a name of a joint account holder, the name and
signature of the person whose name is to be deleted should be cancelled by drawing
two parallel lines with the remark "deleted", and the date of such deletion noted in the
relative account opening/specimen signature card, deposit receipt and pass book under
the full signature of the concerned Officer. A new specimen signature card of the
remaining account holder(s) should also be obtained - the old (cancelled) card should
be carefully preserved with the remark thereon that a fresh card has been obtained with
the deletion effected.

49
Nomination in Deposit Accounts

13.1 The Banking Regulation Act, 1949 has been amended by Section 37 of the
Banking Laws (Amendment) Act, 1983 by introducing new Sections 45 ZA to 45 ZF
which provide, inter alia, for nomination facilities to bank customers in respect of deposit
accounts, safe custody accounts and safe deposit vault lockers. The relevant rules
framed by the Central Government with reference to the above Sections are termed
"the Banking Companies (Nomination) Rules, 1985". These Rules have come in force
with effect from 29.3.1985.

13.2 In terms of the Banking Companies (Nomination) Rules, 1985, nomination facilities
have been made available to the new as well as existing account holders of deposit
accounts, safe custody accounts and renters of safe deposit vault lockers, existing and
new Procedure regarding nomination in deposit account is detailed under the following
paragraphs (Procedures regarding nomination facility for safe custody accounts and
safe deposit vault lockers are given in the respective Chapters in Manual of Instructions,
Volume 2 on 'Miscellaneous Services').

14. The Banking Companies (Nomination) Rules, 1985 are applicable to all deposit
accounts whether opened by resident or non-resident Indians. For the purpose of
nomination there should not be any restriction on account of the status of the nominee
who may be a resident or a non-resident. However, repayment of deposit/credit balance
in the account to a nominee of the depositor(s) will have to be made in accordance with
the provisions of the law in force at the time of repayment. In case any restrictions are
imposed by law at the time of repayment of deposit/credit balance in the account, these
have to be strictly observed.

Nomination Forms for Deposit Accounts

15.1 The Banking Companies (Nomination) Rules, 1985 provide for different forms for
making nomination, cancellation of nomination and variation of nomination as under:

Form DA 1 - for making nomination by the depositor(s) (Specimen-Appendix V)

Form DA 2 - for cancellation of the said nomination to be made by the
depositor(s)(Specimen - Appendix VI)
Form DA 3 - for variation of the said nomination to be made by the depositor(s)
(Specimen - Appendix VII)

15.2 Branches should acknowledge in writing to the concerned depositor(s), the filing
of the relevant duly completed form of nomination, cancellation of nomination and
variation of nomination, as the case may be, in respect of a deposit. Filing of these
forms should also be noted in the appropriate books/Registers.

15.3 To avoid any controversy about validity of nomination and to safeguard the bank
against charges of improper nomination, the thumb impression of the depositor(s) in
the nomination form should be witnessed by two persons.

50
15.4 With a view to rendering better customer service, the name of the nominee may
be indicated in the Savings Bank / Current Deposit pass books and Term Deposit
receipts provided that there is an express mandate from the depositor to that effect. In
this connection the following may be noted:

(i) Depositor is required to request the Bank to incorporate the name of the nominee on
Term Deposit Receipt/s, S/B, C/D pass book (of individuals). Branches can use the
existing nomination forms DA-1 & DA-3 with the following additional paragraph -
"I/We hereby, further request you to incorporate the name of the nominee on the original
Term Deposit Receipt / S/B / C/D pass book which is enclosed herewith".

(ii) Depositor is required to add the following paragraph in form no DA-2.

"I/We enclose herewith Term Deposit Receipt / S/B / C/D pass book to enable you to
cancel the name of the nominee thereon.

(iii) Facility of incorporation of the name of the nominee on Term Deposit Receipt and
S/B, C/D pass book (for individuals) should be made available to all new as well as
existing personal deposit accounts.

16 Salient Points regarding Nomination Facilities

(i) Nomination can be made by the depositor or all the joint depositors, jointly.
Nomination facility may be extended to deposits held in the name of a sole proprietary
concern.

(ii) Nomination can be made only in respect of a deposit which is held in the individual
capacity of the depositor(s) and not in representative capacity as the holder of any office
or otherwise.

(iii) Nomination can be made in favor of only one individual. To further clarify, in case of
joint a/cs. opened in two or more persons, all of the a/c holders are required to give
nomination in only one name.
(iv) Nomination, cancellation of nomination or variation of nomination can be made at
any time during the currency of the deposit.

(v) In the case of Term Deposits, nomination or cancellation of nomination or variation

in nomination will not cease to be in force merely by reason of the renewal of such
deposits.

(vi) Joint Accounts: In the case of joint accounts, nomination, cancellation of nomination
or variation of nomination should be made by all the depositors jointly on the prescribed
forms as specified in paragraph 15.1 above. Any cancellation or variation of a
nomination is not valid unless it is made by all the depositors surviving at the time of
the cancellation or variation of the nomination.

(vii) Accounts of Minor: In the case of a deposit made in the name of a minor, nomination
51
should be made by a person lawfully entitled to act on behalf of the minor.

(viii) Nomination in favor of a Minor: Where the nominee is a minor, the depositor(s)
while making the nomination should appoint another individual not being a minor to
receive the amount of the deposit on behalf of the minor nominee in the event of death
of the depositor(s) during the minority of the nominee.

(ix) In the case of Joint Accounts wherein nomination was not made at the time of
opening the account, the surviving depositors can make a valid nomination upon death
of one of the depositors.

(x) Upon death of one of the depositors in the case of joint deposit accounts, Banks
may allow verification/cancellation of a subsisting nomination if requested by all the
surviving depositors acting together. This is also applicable to deposit accounts having
operational instructions "either or survivor". In the case of a joint deposit account the
nominee's right arises only after the death of all the depositors.

(xi) Nomination facility is available for Savings Bank Accounts opened for credit of
pension However, Banking Companies (Nomination) Rules, 1985 are distinct from the
Arrears of Pension (Nomination) Rules 1983 and the nomination exercised by the
pensioner under the latter rules for receipt of arrears of pension will not be valid for the
purpose of deposit accounts held by the pensioners with banks for which a separate
nomination is necessary in terms of the Banking Companies (Nomination) Rules, 1985
in case a pensioner desires to avail of nomination facility.

(xii) A Banking company making payment to a nominee, in whose favor a valid

nomination subsists on the death of the depositor(s) gets full discharge in respect of its
liability relating to the deposit, in terms of the provisions of sub section 4 of Section 45
ZA of the Banking Regulation Act, 1949. The question, whether the payment to the
nominee is made on or before the due date for maturity of the term deposits would not
affect the said protection available to the banking company. The Question of making
payment before due date for maturity would be governed by the right of the depositor(s)
and the existing directives on the subject as nominee gets the similar rights, in respect
of obtaining premature payment, as the depositor(s) had.

(xiii) Sub-Section (1) of Section 45 ZA of the Banking Regulation Act 1949 provides that
a depositor can nominate one person to whom the deposit can be refunded in the event
of the death of the depositor and Sub-Section (4) of the said Section 45 ZA stipulates
that payment by a banking company to a person nominated as per provisions of Sub-
Section (1) above shall constitute full discharge to the banking company of its liability
in respect of the deposit. Thus, a bank gets a valid discharge only on its making
payment of the deposit amount to the nominee.

However, where a loan is sanctioned against a deposit the deposit is adjusted against
the loan amount only when the loan is not repaid by the borrower. As such, granting of
a loan to a nominee before maturity of the deposit against the security of that deposit
52
does not amount to payment of the deposit amount to the nominee. Therefore, the bank
would not get a valid discharge if a loan is granted to a nominee against the security of
the deposit.

Death of the Depositor(s) who have made Nomination

17.1 Proof of death of the depositor: Branches should follow the procedure of obtaining
the certificate or any other satisfactory modes of proof of death of the depositor(s).

17.2 Identity of the Nominee: Application for settlement of claim format (Specimen
Appendix XXVII) which is required to be submitted by the nominee duly completed and
signed by him as well as two witnesses of good standing and integrity acceptable to the
Bank in case of claimant(s) are illiterate.

Accounts of Sole Proprietorship Concerns

18. It is an account in the name of a firm or a business owned by one individual who is
its proprietor. It is, in all other respects, an account of an individual in his single name,
except that it is operated upon by the individual in his capacity as the proprietor on
behalf of the firm or in the name of the firm. The proprietor may authorize another person
to operate on the firm's account by giving a Mandate or executing a Power of Attorney
in his favor.

Accounts of Partnership Firms

19. Partnership firm comprises of two or more persons who have come together to carry
out certain business by all or any one or more of them acting for all with an intention to
share the profits/losses of business.

Restrictions on Number of Partners

20.1 The number of partners in a partnership firm shall not exceed One Hundred. If
this condition of members is not complied with, such a firm, unless registered under the
Companies Act, 1956, becomes an illegal association in terms of Sections 11(1) and
(2) of that Act.

20.2 Where a partnership firm consists of (i) individual(s) and other separate firm(s) or
(ii) two or more separate firms, each partner of such separate firm(s) should be
individually counted as a partner of the firm formed by combinations of individual or
other firms for the purpose of Section 11 of the Companies Act, 1956. Thus, for
instance, where four firms enter into partnership and the aggregate number of the
partners of all the four firms exceeds 100, it would be an illegal association under
Sections 11(1) and (2) of the Companies Act, 1956.

20.3 Similar consideration will apply to a partnership firm composed (i) of individual(s)
and a Joint Hindu Family or Families, or (ii) of more than one Joint Hindu Families. In
53
such cases, each individual member of such Joint Hindu Family (ies) (other than the
minor members) must be counted for the purpose of Sections 11(1) and (2) of the
Companies Act, 1956. However, accounts of such firms should be discouraged, as far
as possible, and in any event should never be allowed to be overdrawn. Sections 11(1)
and (2) of the Companies Act, 1956, do not apply to a single Joint Hindu Family carrying
on any business, whatever may be the number of its members.

a. In Agrawal & Company V/s. C.I.T. U.P. AIR Case the Supreme Court has expressed
the following views:
“It is now well settled that HUF cannot as such enter into a contract of partnership with
another person(s). The Supreme Court further held that the concept of a HUF joining a
partnership presents considerable difficulty. A HUF is a floating body. Its composition
changes by births, deaths, marriages and divorces. Such partnership is likely to have a
precarious existence. The assumption in section 4(3) of the Old Companies Act,
1913that a HUF can be a partner in a partnership appears to be based on a erroneous
view of the law.”

b. In Rasiklal & Company V/s. C.I.T. Orissa the Supreme Court has stated the following:
“A HUF directly or indirectly cannot become a partner of a firm because the firm is an
association of individuals. A HUF not being a “person” cannot enter into an agreement
of partnership. The partnership Act contains various provisions regulating the
relationship between partners.”

From a reading of the aforesaid judgments, it appears that HUF’s cannot be partners in
a firm and hence such firms who have HUF’s as partners may be viewed as not
competent to enter into contract. Therefore banks must exercise caution in dealing with
such firms have HUF’s as partners while opening bank accounts.

Partnership Deeds

21. Branches have to obtain partnership deed along with any Officially Valid Document
(OVD) in respect of the person holding a Power of Attorney on behalf of any partner or
an employee/partner of the firm to transact on its behalf. Branches should also obtain
Partnership Letter as per present guidelines. A partnership deed, should be carefully
studied to see whether the implied rights of partners are in any way restricted. Where
the partnership deed provides for two partners to sign cheques, Branches cannot
accept instructions empowering any one of the partners to sign cheques on the firm's
account unless the partners suitably amend the provisions in the partnership deed.
There may be other restrictive clauses concerning the bank account of the firm which
might demand a suitable warning record in the ledger, specimen signature card and the
account opening form. It is, therefore, preferable to avoid inspection of a partnership
deed and to rely instead on Bank's Partnership Letter (Form L 438) and the legal
position regarding the implied authority of a partner as stated in the Indian Partnership
Act, 1932.

54
 Registration of Partnership

22. The Indian Partnership Act, 1932, provides for registration of partnership firms. Non-
registration under the Act debars a firm from suing, but it does not affect the rights of
third parties in suing the firm. The advantage of registration of a firm under the Act to
the Bank is that it binds the firm to the statement recorded in the Register of Firms.
Branches need not press firms to register against their wishes so long as the firms want
to open only ordinary deposit accounts (vide Sections 58,59, 60 and 69 of the Indian
Partnership Act, 1932). The following points should be noted

(a) Partnership enjoying borrowing facilities should, as a rule, be registered under the
Partnership Act.
(b) Registration of a firm under Partnership Act is different from the registration of the
firm under the Income Tax/Sales Tax law and registration of the Partnership Deed with
the Registrar of Assurances and these must not be confused.

(c) The Branch should avoid, as far as possible, opening partnership accounts with
restrictive operations thereon.

Opening of Accounts

23.1 In all types of partnership accounts, Partnership deed, along with any Officially
Valid Document (OVD) in respect of the person holding a Power of Attorney on behalf
of any partner or an employee/partner of the firm to transact on its behalf, Partnership
Letter (Form L 438) and partnership deed should be obtained along with account
opening form/card duly signed by all the partners of the firm in their capacity as partners
and also in their personal capacity. In case the Partnership Letter and partnership deed
is already held in existing account at the Branch, it need not be obtained again while
opening another account. It should, however, be ensured that when account in which
the Partnership Letter and partnership deed were held is closed, a new Partnership
Letter, partnership deed and any one OVD of all partners are obtained and kept on
record in one of the accounts which continues.

23.2 The Partnership Letter merely states that each partner has full and unrestricted
authority to sign for and bind the firm. There is no provision therein for the operation of
the account by any one of the partners nor is there any direct reference to the mode of
operation. The letter also has provision that the partners are jointly and severally
responsible to the Bank for all the liabilities of the firm to the Bank.

Customer Identification Procedure:

Please also refer and follow our Bank’s Deposit Policy and the amendments/ changes/
revision in policy from time to time.

Please also follow KYC and AML guidelines/norms/policy and Central KYC Registry
guidelines issued by bank in this regard and any amendments.

55
Bank has framed KYC Policy having following four key elements enabling
identification of customers –

1. Customer acceptance

2. Risk Management/ Categorisation of customer

3. Customer Identification Procedures

4. Monitoring of transactions

KYC updating and Risk review exercise should also be done as per laid down
norms/policy. Customer Profile Sheet (CPS Appendix III) should also be taken in all
accounts. Branches shall do Basic Due Diligence while opening any new account.

23.2 A Branches should strictly comply with the Customer Identification Procedure
(CIP) by obtaining identification documents given below for every new customer without
fail.

SL Type of Accounts Documents to be obtained

.
No
.
1 Individual A) For proof of identity & address (any one of
the following for verification along with a copy):
For customers who are natural persons, the
branches shall do Basic Due Diligence by obtaining
sufficient identification vide self-attested copy of
one of the Six OVDs, verified by original, along with
Customer Profile Sheet(CPS) to ascertain :-
Identity, address etc.

 Letter issued by the National population Register

containing details of name and address
 Passport (within validity period)
 Voter’s Identity Card issued by Election
Commission of India
 Driving License ( within validity period)
 Job Card issued by NREGA signed by an officer
of the State Govt.
 Proof of Possession of Aadhaar Card

And One recent photograph (self-attested), Other

information pertaining to nature of business or
56
financial status for the purpose of Customer Profile
Sheet (CPS).
e-KYC service of Unique Identification Authority of
India (UIDAI) is accepted as a valid process for
KYC verification- information provided by UIDAI.
As a result e-KYC is treated as OVD under PML
rules.

B) Where the OVD furnished by the customer

does not have updated address, the following
documents shall be deemed to be OVDs for the
limited purpose of proof of current address
(any one of the following for verification along
with a copy): Address proof for limited purpose,
1. Utility bill which is not more than two months old
of any service provider (electricity, telephone, post-
paid mobile phone, piped gas, water bill);
2. Property or Municipal Tax receipt;
3. Pension or family pension payment orders
(PPOs) issued to retired employees by
Government Departments or Public Sector
Undertakings, if they contain the address;
4. Letter of allotment of accommodation from
employer issued by State or Central Government
departments, statutory or regulatory bodies, and
public sector undertakings, scheduled commercial
banks, financial institutions and listed companies
and leave and license agreements with such
employers allotting official accommodation.
 The customer shall submit OVD with
current address within a period of three
months of submitting the documents
specified at above

 In case of individual who does not have address

proof in his/her name, a declaration from close
relative with whom he/she resides and whose
identity proof and address proof are obtained

C) Simplified KYC norms(Please see the

guidelines of compliance Dept) :-
Documents for “Low Risk” customers may be
obtained for verifying the identity and shall be
deemed as officially valid document(OVD) :-
 Identity Card with applicant photograph issued
by the Central/State Govt.Deptts.,Statutory,
/Regulatory Authorities
57
  Letter from a Gazetted Officer verifying the
identity and attesting photograph and address And
recent photograph(self-attested).
2 Proprietorship Following documents are to be obtained in addition
concerns to 1 above:
 Proprietorship letter in Bank’s format
 Power of attorney if any granted by the Proprietor
 Additionally, in Proprietorship firm account, ANY
TWO of the following documents must be obtained
and the same will be deemed as OVD :-

RBI has advised that in respect of accounts of sole

proprietary concerns, the Customer Identification
Procedure (CIP) shall, apart from the extant
guidelines, include obtaining and verifying any two
of the following documents for proof of name,
address and activity of the concern before opening
of such accounts:
i. Registration Certificate in case of a
registered concern;
ii. Certificate/licence issued by the Municipal
authorities under Shops & Establishment Act;
iii. Sales & income-tax returns;
iv. CST / VAT/ GST certificate(provisional/
final);
v. v. Certificate/registration document issued by
Sales Tax/Service Tax/Professional Tax
authorities;
vi. vi. IEC (Importer/Exporter Code)issued to the
Proprietary Concern by the Office of The Director
General of Foreign Trade(DGFT) or
Licence/certificate of practice issued in the name of
the proprietary concern by any professional body
incorporate.(Identity Document)
vii. vii. Complete Income Tax Return (not just the
acknowledgement) in the name of the sole
proprietor where the firm’s income is reflected, duly
authenticated /acknowledged by the Income Tax
Authorities.
viii. viii. Utility bills such as electricity, water and landline
telephone bills in the name of the proprietary
concern.
Please note importantly that the above mentioned
documents should be in the name of the proprietary
concern(except (vii) above)
Branches may also accept any registration /
licensing documents issued in the name of the
58
 proprietary concerns by the Central Govt. or State
Govt. Authority / Department. The IEC (Import
Export Code) issued to the proprietary concerns by
the office of Directorate General of Foreign Trade
(DGFT) can also be accepted as an identity
document for opening of Bank accounts of the
proprietary concerns.

In cases where the Branch is satisfied that it is not

possible to furnish two such documents, Branches
may at their discretion, accept only one of those
documents as proof of business/ activity.
Provided Branch undertakes contact point
verification and collect such other information and
clarification as would be required to establish the
existence of such firm, and shall confirm and satisfy
itself that the business activity has been verified
from the address of the proprietary concern.
3 Partnership Firms Following documents are to be obtained in
addition to 1. above:
 Partnership Deed(Registered)
 Registration certificate with a copy certified by
the Partners (if registered)
 Partnership letter in Bank’s format
 Power of attorney, if any, granted by the firm for
verification with a copy
 An OVD in respect of the person holding an
attorney to transact on its behalf. Details of
Beneficial Owner (APPENDIX IV) should be
taken, if any, otherwise take nil.
4 Limited Companies Following documents are to be obtained in
addition to 1. above:
 Certificate of incorporation with a copy certified by
the Secretary/Director of the Company
 A copy of the Memorandum and Articles of
Association (upto date) certified by the
Secretary/Director of the Company
 Certificate of commencement of business with a
copy certified by the Secretary/Director of the
Company (for Public Limited Company)
 Board resolution for opening and operating the
account certified by the Chairman of the meeting
 List of present Directors/ shareholding pattern of
the company signed by the Chairman of the
Company, duly certified by the Statutory Auditor of
the company.

59
  List of authorized signatories with their signatures
attested by the Chairman of the Company
 Power of attorney if any granted by the
Company
 PAN allotment letter for verification with a copy
 Details of Beneficial Owner (other than listed
company) should be taken, if any, otherwise take
nil.
5 Hindu Undivided Family Following documents are to be obtained in addition
(HUF) to 1 above:
 Declaration from Karta
 Joint Hindu Family letter signed by the Karta and
all major co-parceners
 PAN allotment letter for verification with a copy

6 Society/ Following documents are to be obtained in addition

Association/ to 1. above:
Club/  Certificate of registration with a copy certified by
Schools the Chairman/Secretary (if registered)
Etc.  Memorandum of Association (where applicable)
certified by the Chairman/Secretary
 Rules, regulations, bye laws certified by the
Chairman/Secretary
 Committee resolution for opening and operating
the account certified by the Chairman of the
meeting
 A list of authorized signatories with their
signatures attested by the Chairman/Secretary
 PAN allotment letter for verification with a copy
 Details of Beneficial Owner should be taken, if
any, otherwise take nil.

7 Trusts Following documents are to be obtained in addition

to 1. above:
 Certificate of registration for verification with a
copy certified by the Chairman (for Public
Charitable Trust)
 Trust deed for verification with a copy certified by
the Chairman
 Resolution for opening and operating the account
signed by all the Trustees
 Any document listing the names of the trustees /
settlers / beneficiaries
 A list of the names of trustees with their
signatures& addresses attested by the Chairman
 PAN allotment letter for verification with a copy
60
  Details of Beneficial Owner should be taken, if
any, otherwise take nil.

8 Non Resident Indian Following documents are to be obtained in

(NRI) addition to 1. above:
 Passport for verification with a copy
 Work Permit / Permanent Residency / Green
Card etc indicating the NRI’s residence status
abroad for verification with a copy
 NRI declaration
 For Student – A letter from University/College
9 Accounts of Foreign Bank shall, at its option, open a Non Resident
Students studying in Ordinary(NRO) bank account of a Foreign student
India on the basis of his/ her passport with visa &
immigration endorsement) bearing the proof of
identity and address in the home country together
with a photograph and a letter offering admission
from the educational institution in India.
i) Provided that a declaration about the
local address shall be obtained within a
period of 30 days of opening the account
and the said local address is verified.
ii) Provided further that pending the
verification of address, the account shall
be operated with a condition of allowing
foreign remittances not exceeding USD
1,000 or equivalent into the account and
a cap of Rupees Fifty thousand on
aggregate in the same, during the 30-
day period.
The account shall be treated as a normal NRO
account and shall be operated in terms of Reserve
Bank of India’s instructions on Non-Resident
Ordinary Rupee (NRO Account, and the provisions
of FEMA, 1999.
Students with Pakistani nationality shall require
prior approval of the Reserve Bank for opening the
accounts.

61
10 Bank A/cs of Salaried Identity Card / Employer Letter / Employer
Employees Certificate should be obtained only from corporate
and other entities of repute.
Branches obtaining such documents should be
aware of the competent authority designated by the
concerned employer to issue such identity Card /
Employer Letter / Employer Certificate.
Branches should, in addition to the above
document, obtain at least one officially valid KYC
document to establish the prospective customer’s
identity proof and address proof.

Note : There are certain Government Departments, Semi-Govt. or Quasi Govt. Bodies,
local Bodies and certain organizations engaged in Public Utility services e.g. State
Housing Boards, State Electricity Boards etc. which are not liable to pay income tax
under Income Tax Act 1961. However, these institutions/organizations receive grants,
loans or subsidies from the Government and therefore, depend on budgetary allocation
for performance of their functions. As such they do not qualify for payment of interest
and hence savings bank accounts cannot be opened in their names. These includes
local bodies like Municipal Corporations, Zilla Parishads, Taluka Panchayats and gram
Panchayats etc. Hence no branch should open Savings Bank account in the name of
Govt. Departments/bodies depending upon budgetary allocations for performance of
their functions/Municipal Corporations or Municipal Committees/Panchayat
Samitis/State Housing Boards/Water and Sewerage/Drainage Boards/State Text Book
Publishing corporations/Socities/Metropolitan Development Authority/State/District
Level Housing Co-operative Socities etc. or any political party or any trading /business
or professional concern, whether such concern is a proprietary or a partnership firm or
a company or an association.

However, as exception RBI allows the Banks to open savings bank accounts in the
names of State Government departments/bodies/agencies in respect of grant/subsidies
released for implementation of various programs /schemes sponsored by Central
Government/ State Government on production of an authorization to the bank from the
respective Government Departments certifying that the concerned Government
Department or body has been permitted to open savings bank account. Banks while
opening such accounts under savings bank, should keep on their record a copy of the
authorization issued by the respective Central / State Government departments.
(Ref:-RB1/2005-06/399 RPCD.CO.RF.BC.No.87/07.38.01/2005-06 dated June 6, 2006
& RPCD.RF.Dir.5516/07.38.01/2005-06 June, 2006)

Operations on the Account by Partners

24.1 Operations on an account of a firm are governed by the instructions given by all
partners and recorded on the account opening form/card which should be authenticated
under the initials of all the partners. Normally, an account in the name of partnership
firm is proposed to be operated by any one of the partners. However, requests for the
62
operation of a firm account in the modes other than this are not uncommon. Such
modes can be any one of the following

(a) Jointly by any two or three or more of all the partners, or

(b) Jointly by any two or three or more of some (not all) of the partners, or

(c) Singly by one of some (not all) of the partners

24.2 Such accounts with restrictive instructions may be opened of firms having good
reputation and of fair means and the instructions should clearly and unambiguously be
recorded on the account opening form/ card duly authenticated by initials of all the
partners

24.3 If in any such account to be operated upon by more than one partner e g , A, B
and C are partners, and B authorizes A to sign for him, such authority should not be
accepted as sufficient justification for A in his own right and as B's attorney to operate
on the account. This would have the effect of making operations single and not joint,
apart from being objectionable on the ground that the authority given by B to A to sign
for him is not given by all the partners of the firm

Mode of Signature on the Cheques of a Firm

25. The usual mode of signature and endorsement on the cheques of a firm would be
for the partners to sign or endorse for and on behalf of the firm in their capacity as
partners. Sometimes the partners desire to sign or endorse cheques in the name of
the firm. "The signature in the name of the firm is equivalent to the signature by the
person so signing in the names of all the persons liable as partners in the firm". It is the
practice to allow signature or endorsement simply of the name of the firm only if the
name of the firm is a combination of the names or surnames of the partners, e.g. A, B
& Co or B Roy & Co, etc. If the firm is trading under an assumed or a trade name or an
impersonal name e.g. Rainbow Trading Co., Hasmukh Engineering Co, the signature
and the endorsement on cheques of the firm must be for and on behalf of the firm by
the partners in their capacity as such.

Payment of a Cheque Drawn by a Firm

26.1 There appears to be no prima facie case to enquire each time a partner pays into
his personal account a cheque which he alone has drawn on the firm's account, unless
the surrounding circumstances warrant such an enquiry. It may be that the partner may
merely be drawing his salary or his share in the profits or that the amount represents
the refund of a loan that the partner may have advanced to the firm. Much will depend
upon the facts of each case, the standing of' the firm and the partner and the amount
of the cheque. If there is any room for suspicion, it would be prudent to make a judicious
enquiry as to the validity of the transfer. The case demanding the greatest care occurs
where, to meet the demands of the Bank to reduce the overdraft in his personal account,
a partner tenders a cheque which he has just drawn on the partnership account. Enquiry
63
in such an event is imperative

26.2 When cheques drawn on the firm's account by any one partner in favor of a third-
party are lodged in the personal account of the partner or of any other partner, suitable
enquiries should be made to ensure that the Bank acts without negligence. Cheques
payable to a firm should not be accepted for the credit of the personal account of a
partner without the sanction of the other partners, nor for the credit of an account of an
employee of the firm without the firm's permission.

Retirement or Admission of a Partner

27.1 Branches should observe the following procedure on receipt of notice of the
retirement of a partner:-

(a) The date of receipt of notice of retirement should be entered specimen signature
card and the account opening form, under the initials of an officer and the name of the
retiring partner to strike from the a/c and also on the card.
(b) Notice of retirement should be acknowledged to the retiring partner.
(c) Cheques drawn by a retiring partner before his retirement may be paid if otherwise
in order and if the account is an ordinary credit current account/savings bank account.
It is advisable to obtain confirmation of the other partners.
27.2 The retirement or admission of a partner amounts to a change in the constitution
of the firm. Accordingly, the existing account of the firm should be closed and a new
account of the reconstituted firm opened (by requiring all the partners of the
reconstituted firm to complete and sign a fresh set of account opening forms/ cards).
The credit balance in the existing account of the firm should be transferred to the new
account of the reconstituted firm by obtaining a cheque or a letter of authority signed by
the remaining partners of the existing firm in terms of signing instructions in the account.

27.3 If an account of firm which is being reconstituted has a debit balance for any
reason, endeavor should be made to get the account in order (in credit) before the
change in the constitution of the account is given effect to in the books of the Bank in
terms of the instructions in the foregoing paragraphs.

27.4 Pending opening of a new account, the remaining partners of the old firm may be
allowed to operate on the existing account of the firm, if and only if, the account is
merely an ordinary credit account. Arrangements should be made for payment of
outstanding cheques drawn on the existing account, when a new account is opened.

Minors in Relation to a Partnership Firm

28. Under Section 30 of the Indian Partnership Act, 1932, a minor can, with the consent
of all the partners for the time being, be admitted to the benefits of a partnership firm.
At any time within six months of such a minor attaining majority or of his obtaining
knowledge that he has been admitted to the benefits of the partnership, whichever date
is later, such an erstwhile minor may give public notice that he has elected to become
or not to become a partner in the firm and such notice will determine his position as
64
regards the firm, provided that if he fails to give such a notice, he shall become a partner
in the firm on the expiry of the said six months (Section 30 ) Branches should exercise
care in opening accounts of partnership firms where minors have been admitted to the
benefits of a partnership. The date of birth of the minor should be recorded in the books
of the Bank. The minor is not required to sign the set of account opening forms nor can
he be allowed to operate on the account. However his name with Date of Birth should
be entered in a/c. opening form and partnership letter (L-448)

Objection by one of the Partners to Operations

29. On receipt of intimation from one (or more) of the partners to the effect that the Bank
should not allow operations on the firm's account by the other partner(s), all operations
on the account must be stopped. A joint letter must be addressed and sent to the
firm and all partners, stating that having regard to the objection by one (or more) of
them, the Bank is compelled to stop all operations on the account until all the partners
jointly agree to a particular mode of operation. If after receipt of such a letter, any partner
raises some legal contentions, the Branch should make a reference to Head Office
giving all the relevant facts and the copies of the relevant correspondence.

Accounts of Joint Hindu Families or Firms

30.1 Branches are authorised to open, in special cases, deposit accounts in the names
of Joint Hindu Families or Firms of respectability and means as under:

i) Current accounts of business or trading character.

ii) All types of deposit accounts (including current accounts) of non-trading

character.

Under the Hindu Law, the joint family business is carried on by the senior male member
of the family as Karta, or Manager who acts on behalf of the joint family.

30.2 The account of Joint Hindu Family should be operated upon by the Karta, who
should complete the account opening form/card (Appendix VIII). In current accounts (of
trading nature) of Joint Hindu Families, in addition, the Bank's printed Joint Hindu
Family Letter (Form CD 115) should be completed and signed by the Karta and the
major co-parceners; the names and dates of birth of minors should be mentioned in the
space provided. Now Female member of the family can also be Karta. Any one OVD
should be taken from all the authorized persons. For all dealings with the Bank, the
Karta is the person who acts on behalf of the joint family or firm.

30.3 In all deposit accounts of Joint Hindu Families (including current accounts) which
are non-trading in nature, Branches need not obtain Joint Hindu Family Letter (Form
No. CD 115). Instead, an unstamped Joint Hindu Family Letter as per specimen given
in Appendix VIII should be obtained, in addition to the relevant account opening
form/card. The Joint Hindu Family Letter should be completed in all respects and signed
by the Karta and the major members in their individual capacity as also on behalf of
65
their joint family. Particulars of the minor members of the Joint Hindu Family must be
given in the Joint Hindu Family Letter.

Partnership of Joint Hindu Family with Outsider

31. HUF cannot enter into contract of partnership with another person or persons.
Hence an HUF can never be a partner in a partnership firm.

Accounts of Illiterate Persons

32. A person is said to be illiterate when he is unable to read and write. The account
(other than Current Account) of such a person may be opened provided he calls on
the Bank with a latest passport size photograph. Thereupon, his thumb impression or
mark should be obtained on the account opening form/card in the presence of the
Bank's official. Such thumb impressions or marks affixed by illiterate persons on
instruments are equivalent to their signatures. Any withdrawal/repayment of deposit
amount and/or interest by way of withdrawal form or otherwise should similarly be
affixed with the thumb impression or mark of the depositor.

33. The Bank's Officer will then complete the account opening formalities by obtaining
thumb impression or mark of the depositor on the card. It would suffice if the officer
opening the account is satisfied that the photograph is that of the depositor who had
come in person (These instructions also apply to illiterate account holders who give
their photographs subsequent to their opening the account). To guard against the
substitution of photographs, the same should be pasted on the account opening form
and thumb impression obtained on the photographs in addition to thumb impression at
the place of signature, and initialed by the Bank's authorized official under date in red
ink ball-point pen in token of having satisfied himself that the photograph is of the
depositor himself. As a further precaution, the Branch round rubber stamp should be
affixed halfway across the card and the photograph but care should be taken to see
that the photograph is not mutilated/ disfigured.

34. At the time of withdrawal/repayment of deposit amount and/or interest, the account
holder should affix his thumb impression or mark in the presence of the cancelling
officer who should verify the identity of the person from the photograph stapled to
account opening form/card prior to passing the instrument for payment

35. The Branch should impress upon such illiterate account holder the need of proper
care and custody of pass book, deposit receipt etc given by the Bank in respect of his
deposit account with the Bank.

Accounts of Visually Impaired Persons

36. Branches may open an account in the name of a visually impaired person as he is
not legally incompetent to enter into a contract. He must call at the Branch in person
and sign/put his thumb impression on the account opening form/card in the presence
of the Bank's official and an approved witness known to both the Bank and the
66
depositor.
36.1 Visually impaired persons be allowed to open an account with cheque book facility
(cheques to be crossed at the time of issue) with an undertaking by the account holder
that the cheque book be issued at his/her own risk. On the request of the account
holder, the branch should issue the cheques in the name of the specified payee to make
periodic payments for the retail loans, utility bills etc. At the time of issuing of cheque
books, thumb impression of the account holder should be duly affixed and authenticated
by the bank official.

36.2 For cash withdrawals, the visually impaired person should personally present
himself/herself before the branch official who will facilitate filling up the
cheque/withdrawal slips.

36.3 The facility of opening the lockers be also allowed to the visually impaired account
holders without insisting on the joint account, as this may not be possible for those who
are single or whose spouse is also visually impaired and children are minor.

36.4 ATM facility be also allowed on demand to the visually impaired customers as
available to other customers. Branches should also ensure that the ATMs are
accessible to other categories of persons with disabilities such as the wheel chair
users. No Current Account should be opened in the name(s) of visually impaired
person(s)

37. The Branch should impress upon the visually impaired account holder(s) the
obvious risk involved and the precautions to be taken in the matter of care and custody
of pass book/cheque book/deposit receipt given by the Bank in lieu of his deposits with
the Bank. Normal precautions should be exercised by the Branch for protection and
safety of the Bank.

Minors' Accounts

38.1 A minor is a person below the age of 18 years.

38.2 A minor is under legal incapacity to contract by himself and, therefore, a guardian
recognized by law along can deal with the person and property of the minor. The term
"guardian" includes a natural guardian or guardian appointed by the Court of Law.
Discharge given by guardian, during the minority of the ward, cannot be challenged by
the minor during minority or after attaining majority. Ordinarily, an account of a minor is
opened and operated upon by the natural guardian of the minor or by the guardian
appointed by the Court.

38.3 It is permissible to open any type of deposit account in the name of and/or to be
operated upon by a minor within the framework of rules of business of the Bank as
outlined hereunder - But no Current Account should be opened.

Natural Guardians

39.1 Hindus: The natural guardians of a Hindu minor in respect of the minor's person
67
as well as the minor's property (excluding the minor's undivided interest in joint family
property) according to the Hindu Minority and Guardianship Act, 1956 is

(a) in the case of a boy or an unmarried girl – Father or Mother .

(b) in the case of an illegitimate boy or illegitimate unmarried girl – Father or Mother .

(c) in the case of a minor married girl - the husband.

Note the expressions "Father" and "Mother" do not include "a step father/step mother".

39.2 If both the father and mother are not alive, no one other than a person holding a
guardianship certificate from a competent Court can act as a guardian of a minor.

39.3 Parsis, Christians and Europeans: Under systems of personal laws applicable
to Parsis, Christians and Europeans, the father is the natural guardian. The mother will
be the natural guardian only if the father is not alive. If both are not alive, a person
holding a guardianship certificate from a competent Court can act as guardian.

39.4 Accounts of Mohammedan Minors:Normally, accounts of Mohammedan minors

should be opened and operated upon by the father, who is the natural guardian of the
minor and in no event can the mother act as natural guardian of the Mohammedan
minor. Even after the father's death, the mother is not considered to be the natural
guardian under Mohammedan (Sunnite) Law. However, Branches may open accounts
in the names of Mohammedan minors to be operated upon by the mother on the
following terms.

Accounts in the name of Mohammedan minor to be operated upon

A Letter of Consent should be obtained

duly signed by the father as per
Specimen - Appendix IX after deleting
By mother
i) Father alive the word 'natural' from 'natural
SINGLY
guardian' while referring to mother who
is only the guardian and not the natural
guardian.
Father alive, but
Stamped indemnity should be obtained
By mother his consent
ii) from the mother as per Specimen-
SINGLY cannot be
Appendix X with acceptable sureties.
obtained
Stamped indemnity should be obtained
from the mother as per specimen -
By mother Appendix X with acceptable sureties.
iii) Father deceased
SINGLY Account can be operated upon by the
mother as the 'guardian' but not the
'natural guardian'.
68
 A letter as per Specimen Appendix XII
should be obtained duly signed by both
By father and father and mother after deleting the
iv) mother EITHER word 'natural' from 'natural guardian'
OR SURVIVOR while referring to mother who is only
the guardian and not the natural
guardian.

Note: There is no upper limit for acceptance of Deposits in Savings Bank and Term
Deposit Accounts and the total amount repayable at the end of the stipulated term in
respect of Recurring Deposit Accounts.

39.5 Branches may also open joint accounts in the name of a major and a
Mohammedan minor to be operated upon by "Former or Survivor" where the word
'Former' refers to the major provided the major is related to the minor in the following
capacities:

Father (being
i)
natural guardian)
A letter of consent should be obtained duly signed by
the father as per specimen -Appendix IX after deleting
ii) Mother the word 'natural' from 'natural guardian' while referring
to mother who is only the guardian and not the natural
guardian.
Major brother or A letter of consent should be obtained duly signed by
iii)
major Sister the father as per Specimen -Appendix XI.
Grandfather or A letter of consent should be obtained duly signed by
iv)
grandmother the father as per Specimen –Appendix XI.

Where it is not possible to obtain the consent of the father (for reasons, such as the
father not in India etc.) suitable Stamped Indemnity should be obtained from the major
(mother or above mentioned other relatives) as per Specimen-Appendix X with
acceptable sureties.

The balances in such joint accounts at any time should not exceed Rs. 25.000/- as far
as Savings Bank Deposits are concerned. However, there is no upper limit for the
balance/deposit amounts in Term Deposit Accounts and the total amount repayable at
the end of the stipulated term in respect of Recurring Deposit Accounts.

39.6 Such joint accounts can also be opened if the minor is below 10 years of age, as
in the case of minors other than Mohammedans.

39.7 All other instructions applicable to accounts of minors (other than Mohammedans)
will also apply to the accounts of Mohammedan minors.

69
39.8 As mother is not considered as a 'natural guardian' under Mohammedan Law, the
legend on the account opening cards as also on the cheques and withdrawal forms
should be
"A.B.C. (Minor) by his/her mother and guardian Mrs. X.Y.Z.
..........X.Y.Z."

39.9 In case the minor’s a/c is operated upon by natural guardian, the legend on the a/c
opening cards and also on the cheques and withdrawal form should “ABC (minor) by
his / her natural guardian”

Guardian Appointed by Court

40.1 A guardian appointed by Court is a person appointed by a competent Court of Law

as guardian of the person and property of a minor. Such a guardian is appointed when
the natural guardian of a minor is not alive or unable to discharge his duties as a
guardian.

40.2 Before opening an account of a minor to be operated upon by the guardian

appointed by the Court, the Court Order appointing the person as a guardian should be
obtained and examined and its copy kept on the record of the Branch. It is essential
that the guardian is properly introduced or identified.

Modes of Operations
(a) Accounts Operated upon by Guardians
41.1 Normally, accounts of minors should be opened and operated upon by the natural
guardian/guardian appointed by the Court.

41.2 An account in the name of a minor to be operated upon by the mother (in cases
other than Mohammedans Appendix IX) as natural guardian even though the father is
alive can be opened,

41.3 It would also be in order to open and allow operation on the minor's account by the
mother of the minor (in cases other than Mohammedans Appendix XII) without obtaining
such letter of consent from the father, provided the Branch is fully satisfied about
standing and respectability of the parties.

41.4 In terms of the Supreme Court ruling on Hindu Minority and Guardianship Act,
opening and operations of Minor's account by mother, may be allowed in the absence
of father without insisting upon the consent letter from the father. The Supreme Court
lays down that the father is considered as absent if:

i) Father and mother are separated or divorced,

ii) Father has left the minor in the custody of the mother,

iii) Father is not taking care of the mother and minor,

70
iv) It is agreed between the spouses that the mother shall take care of the minor.

If the circumstances listed above exist, the consent letter from the father should not be
insisted and the mother should be allowed to open and operate the minor's account.

41.5 Branches may open deposit accounts of a minor to be operated upon by either the
father or the mother (in cases other than Mohammedans).

41.6 There is also no objection to opening a joint account in the names of two minors
to be operated upon by the natural guardian of both the minors.

41.7 The mode of signature on the cards and withdrawal forms/cheques in these
accounts should be "A B C (Minor) by his/her natural guardian/guardian appointed by
Court X Y Z”.
(b) Accounts to be operated upon by Minor Alone

42.1 As a minor has no capacity to contract, it is generally believed that any commercial
transaction with him is risky. But where minor is a creditor, there is no risk in dealing
with him because where a minor has received funds, his discharge is valid and effective.
Banks normally allow a literate minor over the age of 10 years and above to operate a
deposit account since it is only after such age that a minor would ordinarily be able to
comprehend the nature of bank account (practices differ from Bank to Bank).

42.2 Accounts to be operated upon and/or the balance repayable to the minor alone
can be opened, provided he is aged 10 years or more, with restrictions on maximum
balances/repayments as shown below Care should be taken that he / she should
receive the payment by himself.

(i) Saving Bank Accounts Balance not exceeding Rs 25.000/- at any time.

(ii) Recurring Deposit Accounts The total amount repayable at the end of
the stipulated term without any upper limit.

(iii) Term Deposit Accounts The amount of deposit without any upper limit
(to include Fixed/Short/DBD/MIC, etc.)

(c) Joint Accounts of Minors

43.1 Joint account of a minor of 10 years and more may be opened as under:

(i) Jointly with natural guardian.

The operational instructions may be obtained as -

(a) Either or Survivor, or

71
(b) Former or Survivor (The word "Former" may refer either to natural guardian or to
minor)

(ii) Jointly with mother/major brother/major sister/grandfather or grandmother

(paternal or maternal) who are not the natural guardians

The operational instructions should be "Former or Survivor" where "Former" shall refer
to the mother/grandfather/grandmother/major brother or major sister, and "Survivor" to
minor.

The balances in such joint accounts at any time should not exceed Rs 25,000/- in
Savings Bank accounts. However, the balances in Recurring Deposit accounts and
Term Deposit accounts are without any upper limit.

43.2 Branches may also open joint account of a minor with a major as described under
(ii) above even if the minor is below 10 years of age. Since, in such cases, the minor
is incapable of signing at the time of opening of the account, the account opening card
would bear:

i) the name of major, his address and his specimen signature, n) the name of minor, his
address but no specimen signature of the minor.

Specimen signature of the minor should be obtained only when he/she completes the
age of 10. A suitable note should be taken for this purpose. Where Branches have
opened such accounts and obtained the signature of the minor before completion of the
age of 10, a fresh signature of the minor should be obtained when he/she
completes the age of 10.

43.3 In the event of the death of the major account holder in such an account, where
the minor continues to be below 10 years, the account can be operated upon by the
natural guardian of the minor till the minor attains the age of 10 years and the
account thereafter will be operated upon by the minor himself. Branches should
obtain the specimen signature of the natural guardian of the minor on receipt of notice
of death of the major joint account holder. The Branch may or may not receive a formal
notice of the major's death, it is sufficient if there is an announcement of the death of
the account holder in newspapers, such an announcement is deemed to be proper
notice of death. When the minor attains the age of 10 years, Branches should carefully
note to stop all withdrawals by the natural guardian, as the minor is considered capable
of operating the said account himself.
44. It is not safe to open a joint account in the names of two minors to be operated upon
by either of them as one of the minors can, on attaining majority, question the operations
by the other minor. However, joint accounts in the names of minors who are of the age
of 10 years & above may be opened to be operated upon by them jointly subject to
maximum balance restrictions referred above.

44. A Branches may accept without any upper limit, deposits in Savings Bank Accounts
of minors operated upon by:
72
(i) The natural guardian, father

(ii) The Guardian appointed by the Court

(iii) The mother as natural guardian (in cases other than Mohammedan Minors)

(iv) The mother as Guardian (and not natural guardian) of a Mohammedan minor

44. B. The upper limit of Rs 25,000/- for balances in Savings Bank Accounts of minor
shall be applicable in the following cases only:

i) Account of a minor operated by self,

ii) Joint account of two minors operated by them jointly,
iii) Joint account of a minor with his natural guardians,
iv) Joint accounts of minor with his mother/major brother/major sister/ grandfather/
grandmother (Paternal & Maternal)

Management of Minors' accounts

45.1. While opening any type of deposit account in which a minor is a party, birth date
of minor and date of his attaining majority must be noted prominently in red ink ball-
point pen on the account opening form/ card, pass book. The date of birth should be
verified from school/birth certificate from the Municipality or Grampanchayat and a note
of proof made on the form/card. A copy of such certificate should be kept on record.
When a minor attains majority, his/her latest photograph should be taken (Along
with the specimen signature card & mode of operations).

45.2. Branches from rural and semi urban areas facing difficulty in obtaining any of the
above certificates may accept a declaration from the minor's parents as proof of the
date of birth of the minor if the guardians are unable to produce any of these certificates.

45.3. The declaration should be obtained in the form- as per Specimen Appendix XIII
when both of the parents of the minor are alive, the declaration from the surviving parent
should, however, be obtained in form as per Specimen-Appendix XIV if one of the
parents is deceased. The declaration in both the cases should be unstamped.

45.4. A constant watch has to be kept on the accounts of minors and their attaining
majority particularly in accounts which are operated upon by the guardians, because if
the erstwhile guardian makes any withdrawals from a minor's account after the minor
has attained majority, the withdrawals may be questioned by the erstwhile minor. To
eliminate this risk and generally to safeguard the Bank's interest, it is necessary to
maintain a record of the dates of minors' attaining majority. In the present computer
system, a report can be generated by invoking menu option, a list of accounts where
minors are attaining majority. The report should be periodically taken.
45.5. If a withdrawal form/cheque signed by natural guardian/guardian appointed by
73
Court is presented for payment after the date on which the minor has become major,
the erstwhile minor must be contacted and his instructions sought. If he cannot be
contacted, the withdrawal form/cheque should be returned with the answer "Mr/Miss
……………………………………. (the erstwhile minors name) has since attained
majority".

Procedure after Minor Attains Majority

46.1. When a minor attains majority, the guardian ceases to be the guardian and the
account ceases to be that of a minor. The payment from the account should be made
to the erstwhile minor provided the Branch is satisfied about his identity. When a minor
attains majority, his/her latest photograph should be taken along with the
signature card (new).

46.2. When the account is operated upon by the guardian on behalf of the minor, who
has attained majority, a Balance Confirmation Letter duly signed by the erstwhile minor
with his signature duly verified by the guardian should be obtained. The signature of the
erstwhile minor should be obtained on the form/card and it should be verified by natural
guardian/guardian appointed by Court. Having done this, it is not necessary to close
the existing account and to open a new account, but the note made in the ledger
account and the account opening form/card to indicate that it is a minor's account,
should be cancelled. Thereafter, the account should be operated upon only by the
erstwhile minor.

46.3 When the account is operated upon by the minor himself, after attaining majority,
the erstwhile minor should be asked to sign a Balance Confirmation Letter which should
be kept on record after making a note in the relative card/ledger account.

46.4 Where the account is operated by two minors jointly, upon one of them attaining
majority, the account should be closed after obtaining Balance Confirmation Letter duly
signed by both the account holders with the withdrawal form for the final balance signed
by the two jointly. The account holders may then open new accounts according to the
Bank's rules.

46.5 Where, in a joint account of a minor with natural guardian father or

mother/grandfather or grandmother (paternal or maternal), brother or sister (major), the
minor has attained majority, a Balance Confirmation Letter duly signed by the account
holders should be obtained. Note of the Balance Confirmation Letter should be made
in the account opening form/card. The birth date of erstwhile minor should be cancelled
and authenticated under initials of the concerned officer.

46.6 Where, in a joint account of two minors operated by the natural guardian of both,
one of the minors has attained majority, the account should be closed after obtaining
the Balance Confirmation Letter duly signed by both the account holders with the
withdrawal form/cheque for the final balance signed by the erstwhile minor and the
natural guardian on behalf of the other minor A fresh account(s) may be opened as they
may wish.
74
46.7 In Term Deposit accounts such as Fixed/Short Deposits, Monthly Income
Certificates, Double Benefit Deposits, Recurring Deposits, where the account is in the
name of a minor to be operated upon by the natural guardian or jointly in the name of a
minor and his natural guardian, Branches should exercise care at the time of repayment
of the amounts and ensure that the minor has not attained majority, and if he has
become major, his discharge is obtained, in addition to the natural guardian's discharge,
where necessary, for repayment of the amount

Accounts of Limited Companies

47. A Limited Company may be public or private incorporated under the Companies
Act.
48. When the Registrar of Companies issues a Certificate of Incorporation, a Company
comes into legal existence.

49. Before opening an account of a limited company the following requirements must
be complied with:
(a) The original Certificate of Incorporation should be inspected and a copy thereof
(certified true by the Secretary) obtained for the Bank's record (This requirement may
not be insisted upon for long established and well-known companies).

(b) The original Certificate of Commencement of Business should be inspected in the

case of a public company A copy certified true by the Secretary of the Company should
be obtained for the Bank's record (The Certificate may not be obtained in the case of
long established and well-known companies) Certificate of Commencement of
Business is not required in the case of a Private Limited Company or a Company
Limited by Guarantee.

(c) A copy of Memorandum and Articles of Association duly certified as true and up to
date by the Secretary of the Company should be obtained and kept on record. The
Memorandum and Articles of Association should be studied and any special
restrictions/requirements in regard to the dealing of the Company with the Bank should
be noted and acted upon.

(d) A copy of the Board Resolution authorizing opening of the account duly certified true
by the Chairman of the meeting at which the Resolution is passed should be obtained
(Specimen-Appendix XVI). There should be a specific mention in the Resolution about
the type of deposit account to be opened. A Resolution obtained incorporating opening
of different categories of deposit accounts, if on record, may suffice in future to open
any type of deposit account covered by the Resolution. No fresh Resolution need be
asked for in such cases but a copy of the Resolution on record should be kept with the
account opening form/card relating to the new account with a proper noting as to where
the original Resolution is filed. It should be ensured that the instructions regarding
operations on the account contained in the Resolution are in conformity with the relative
provisions in the Company's Memorandum and Articles of Association.

(e) A copy of the latest audited balance sheet and profit and loss account may be
75
obtained in the case of a public limited company.

(f) A list of the present Directors signed by the Chairman may be obtained.
(g) In case of a company’s account (other than listed company) details of Beneficial
Owner should be taken, if any, otherwise take as nil.
(h) Any one OVD evidencing KYC should be taken from all the authorized persons.
49. A. Sometimes, while opening an account, a company is unable to furnish Board
Resolution along with other documents such as, Certificate of Incorporation,
Memorandum and Articles of Association etc. In such cases, current account in a
Limited Company's name can be opened on the basis of omnibus resolution passed by
the company's board of directors, empowering its Chief Executives etc., to open
accounts at banks. Such resolution should have been passed at a meeting of board of
directors and should not be 'Circular Resolution'. It is advisable that the resolution
mentions account opening officials by designation rather than by names. The power
delegated through the resolution or by grant of a power of attorney to sign on behalf of
the company, should not be confined to cheques only, but should extend to other
orders, whether the account is in credit or debit. It should even extend to the bills to be
accepted on behalf of the company.

49. B. Occasions may arise when a Company is required to open a Current Account at
places, other than its head quarters, where the Company has Branches/Offices. Under
the circumstances, the Company may not be able to produce a Board Resolution for
opening an Account at such a place with any Bank until after the Board Meeting. In such
cases, a Current Account in the name of the Limited Company can be opened on the
basis of an Omnibus resolution passed by the Company's Board of Directors
empowering its Chief Executives etc. to open accounts at Banks. However, all other
documents should also be obtained at each Bank Branch maintaining such accounts.
It will be advisable to mention account opening officials by designations rather than by
names in the resolution. It should not be a 'Circular Resolution' but passed at a Meeting
of the Board of Directors. A Draft of the intended resolution for the limited use of
Companies in need of opening an operative account at any of the Bank's outstation
Branches for certain limited purpose, like management of a site office etc. is given in
Appendix XV.

Completion of Account Opening Form

50.1 Branches are sometimes requested to send a set of account opening forms/cards
for being filled in at the company's office. This facility should be restricted only to
companies of long standing and well-known to the Bank. In all such cases where the
forms have been sent for completion to the Company's office, specimen signatures of
the officers of the company who are authorized to operate on the account should be
attested by the Chairman of the company, whose signature must be known to the Bank
and must be carefully verified. Branches are cautioned against indiscriminate extension
of this facility and are advised to depute a responsible member of the staff to have the
forms/cards duly completed by the company's officers in his presence.

76
50.2 In the case of companies when none of the directors is known to the Bank, it would
be worthwhile to make independent market enquiries on the standing of the company/its
directors and also to take a search in the company's records at the office of the Registrar
of Companies.
Branches should not insist on Company’s seal, unless there is a provision to the effect
in their Memorandum and Articles of Association for opening of a company account.

50.3 Issuance of cheque books to Limited Companies (Public and Private Ltd.
Cos.) Branches should issue 'order' cheque leaf books only, to the corporate clients,
unless a request to the contrary is made in writing.

Change of Directors - Authority to Operate

51. In the event of any changes in the Directors authorized to operate on the account
of the Company, a copy of the relative Board Resolution certified true by the Chairman
of the meeting at which the Resolution was passed should be obtained for record.
(Branches should also obtain fresh specimen signature form/card duly signed by all
authorized signatories including the new Directors authorized to operate the account,
with their signatures verified by the Chairman).

Form of Signature on Cheques as Drawer

52. The common form of signature on cheques drawn by a limited company in terms of
Section 147(1)(C) of Companies Act, 1956, is

For A.B. & Co. Ltd.

"X.Y.Z."

Director/Secretary

The above illustration shows the name of the company - the essential thing -as required
by the Companies Act, 1956, followed by the signature of the person who wrote or
impressed it, with the designation to indicate that it was done under authority and on
behalf of the company. It is not the practice of the Bank to accept an endorsement on
a cheque, let alone any drawing of a cheque, in the form of mere name of the company
only, as there is nothing to show that it was written on behalf of the company by some
one in authority.

Safeguards against Conversion of Cheques

53.1 Branches should treat with care all cheques drawn by a limited company which
are presented for collection in an account other than that of the named payee. Branches
should not collect without stringent enquiry a cheque drawn by a limited company
77
payable to a third-party and apparently endorsed by the payee for the private account
of a director or employee of the company which drew the cheque.

53.2 PROPER PLACE FOR THE DEPOSIT OF CHEQUE PAYABLE TO A LIMITED

COMPANY IS THE COMPANY'S ACCOUNT ANY OTHER METHOD OF DEALING
WITH THE CHEQUE PUTS THE BANK ON ENQUIRY. Branches should not collect a
cheque payable to a limited company for the personal account of any director, official
or employee of the payee company without enquiries (preferably obtaining from the
company a confirmation of the explanation afforded by the presenter of the cheque).
Branches should not collect a cheque payable to a limited company for the account of
any other party without proper enquiry, the extent of which must depend upon the
circumstances of the case. Particular care would be necessary when the customer is
short of funds or some connection with the payee company is suspected.

Importance of the Registered Office of a Company

54. To the Bank, the registered office of a company is of importance as the address
where all notices and documents may be served upon the company. A document/legal
notice to be properly served on the company or an officer thereof must be sent to the
company or the officer at the registered office of the company by post under certificate
of posting or by registered post or by leaving it at the registered office of the company
(Section 51 of the Companies Act, 1956). Statements of account, paid cheques and
genera! Correspondence relating to day-to-day business of the company may be sent
to the respective offices of the company by mutual arrangements.

Winding Up of a Limited Company by Court's Order

55. A limited company may be wound up by the Court in which case the winding up
order is served on the Bank. No cheques drawn on the account should be paid even
though they were drawn prior to the date of receipt of Court's winding up order.

56. Appointment of liquidator: The liquidator(s) who may be appointed for the
purpose is the only person(s) who will deal with the account (Refer paragraph 77.1 to
77.4).

Accounts of Clubs, Schools, Societies (including Co-operatives),

Associations, Committees etc.

57. Account may be opened in the name of a club, school, society (including co-
operative society), association, committee, etc., which is registered or incorporated
under the Societies Registration Act or the Companies Act, 1956 or Co-operative
Societies Act.

58. The activities of these bodies are governed by their rules, regulations, bye-laws etc.,
it should be ensured that bank account is opened and operational instructions are in
conformity with the rules, regulations, etc. Before opening an account the following
documents should be obtained:
78
(a) Certified true copy of the rules, regulations, and bye-laws (as the case may be).

(b) Certified true copy of Memorandum of Association, where applicable.

(c) Certificate of Registration or Incorporation in original (which may be returned after

inspection). A certified true copy of the Certificate should be obtained for the Bank's
record.

Note: (a), (b) and (c) should be certified by the Chairman/Secretary.

(d) A certified true copy of the resolution (certified by the Chairman of the Meeting of
Board of Directors or Managing Committee at which it was passed) authorizing opening
of an account with the Bank and authorizing certain office-bearers in accordance with
the rules and bye-laws of the body to sign cheques and operate the account etc.
(Specimen-Appendix XVI or XVII as may be applicable). Type of deposit account to be
opened should be specifically brought out in the resolution. If the resolution on record
provides clearly for opening of accounts of different categories of deposits, no separate
resolution for each type of deposit account to be opened is necessary, but a copy of the
resolution on record should be kept with the account opening form/card relating to the
new account with a proper noting as to where the copy of original resolution is filed.

(e) A copy of the latest balance sheet in the case of Co-operative Societies, if available.

(f) Details of Beneficial Owner should be taken, if any, otherwise take as nil.

(g) Customer Profile Sheet should be taken.

(h) Any one OVD should be taken from all the authorized persons.

(Format Customer profile sheet Appendix III)

59. In the case of account of Co-operative Society, in some States, the Co-operative
Societies Acts do not permit a society to open accounts with banks other than a Co-
operative bank without the permission of the Registrar of Co-operative Societies. For
the sake of good order, the Letter granting permission to open account with the Bank
should be inspected and necessary action taken; a copy of the Letter may be kept on
record.

60. In the event of subsequent changes in the Board of Directors or Management or the
Managing Committee, a copy of the resolution certified true by the Chairman should be
obtained by the Bank for its record (Fresh specimen signature cards or slips signed by
the new Directors or Members of the Managing Committee with their signatures verified
by the Chairman should also be obtained).

61. Sometimes the Bank is approached to open accounts of clubs, schools, societies,
associations or committees which are unregistered. Such unregistered bodies have no
legal entity and cannot be sued in their own names. The Bank may be put to difficulties
79
in the case of internal disputes arising amongst the members of such bodies Accounts
of unregistered clubs, schools, societies, associations, etc, should be opened in their
names provided Manager is thoroughly satisfied about the objects and the constitution
of such bodies and the respectability and standing of the office-bearers. The accounts
of unregistered associations should not be allowed to be overdrawn even temporarily.

Precautions
62. Cheques payable to clubs, schools, societies, associations etc, either in their own
names or in the name(s) of office-bearers in their fiduciary capacity should not be
collected in the private accounts of office bearers or other employees of those bodies.
Similarly, cheques drawn on the account of the club, school, society or association
payable to third-parties should not be collected in the private accounts of the office
bearers or employees of the club, school, society or association except after stringent
inquiry.

Accounts of Trusts

63. By an instrument of Trust Deed, an estate is placed in the hands of the Trustees to
whom the estate is entrusted in order that they may deal with it in accordance with the
provisions of the Trust Deed. A Trust may be Public Charitable Trust or Private Trust
(for the benefit of private individuals).

64. Branches may open any type of deposit account or safe custody account in the
name of a Trust by adopting the following procedure and precautions strictly, but, in
dealing with such an account care must be taken to see that the Bank is not knowingly
a party to a breach of trust.

Examination of the Instrument of Trust Deed

65. Before opening a trust account, the original Trust Deed (Instrument/Document
creating the Trust) must be obtained for examination. Such instrument may be a Trust
Deed or scheme framed by a competent authority such as a Charity Commissioner or
by an order of a Court. There are some charitable institutions which are for promotion
of education or for providing medical aid or for furtherance of religious activities etc,
which have in addition to the Trust Deeds their own rules and bye-laws or constitutions
for the administration of the trust and the powers of the trustees, in these cases such
rules and bye-laws or constitutions should be treated as part of the Instrument of Trust.
In what follows the word "instrument" is used as a general term meaning any document
creating the trust and defining the powers of trustees. The Instrument of trust should be
carefully examined to get answers to the following questions and to ascertain as well
the legal obligations applicable to the conduct of the account:

(a) Whether the trust is a public charitable trust or a private trust.

(b) What is the minimum number of trustees provided in the Instrument?

(c) Whether the Instrument contains any provision authorizing the trustees to open a
bank account of the type desired to be opened.
80
(d) Whether the Instrument contains any provision authorizing the operation of such
account by a number of trustees which is smaller than their full or maximum number.

(e) Whether the Instrument contains any provision authorizing the trustees to delegate
their powers to some of them.

(f) Whether there are any provisions in the Trust Deed which place onerous
responsibilities on the Bank regarding the operation of the account.

66. The opening and operation of the account depend upon the answers to the above
questions, as indicated below:
(a) If the trust is a public charitable trust, enquiries must be made whether it is registered
with the Charity Commissioner or such other competent authority In most (though not
all) of the States, there are Public Trusts Acts under which any public charitable trust is
compulsorily required to be registered with the Charity Commissioner or such other
authority appointed under the Act, and a certificate of registration is issued to the
trustees. The original of such certificate of registration should be called for, examined
and a copy taken on record. There can be no certificate of registration in respect of a
wholly private trust i.e. a trust with no charitable objects, but made solely for the benefit
of private individuals, mostly family members of the settler.

(b) The trust should have the prescribed minimum number of trustees as provided in
the Instrument.

(c) If the Instrument contains any provision authorizing the trustees to open a bank
account, any restriction or condition implied by such provision regarding the operation
of the account must be strictly complied with by the trustees.

(d) If the instrument authorizes the operation of a bank account by a number of trustees
less than their full number, the operation must be allowed by the specific number
mentioned in the Instrument.

(e) If there is a provision in the Instrument regarding the operation of a bank account by
some only out of all the trustees, it is NOT necessary to see whether there is a general
provision authorizing the trustees to delegate their functions and powers to some of
them. If, however, there is nothing in the Instrument regarding the operation of bank
accounts, the provision authorizing delegation to some of the trustees becomes
relevant. If, for instance, it is provided that there shall be five trustees and that they can
delegate their powers to any two of them, the operation of the account can be permitted
by any two of them.

(f) The operation of the account by only one of several trustees can be permitted only
if the Instrument specifically and in clear terms authorizes such operation.

(g) If the Instrument places any restrictions on the operation of the bank account, these
restrictions should be strictly complied with. For instance, the Instrument may provide
81
that the account should be operated by one particular trustee (sometimes called the
"Managing Trustee") jointly with any two of the rest of them, or it may provide that the
account should be operated upon by any one of a particular group of the trustees jointly
with any one of the remaining trustees. The latter type of provision is sometimes found
in Provident Fund Trusts. The operation must be allowed accordingly.

Documents to be obtained

67. After examining the Instrument and determining how the operation on the account
is to be allowed, the following documents should be obtained:

(a) The account opening form/card should be signed by all the trustees, whatever may
be the mode of operation. Customer Profile Sheet (CPS) should be taken (Appendix
III). Any one OVD should be taken from all the trustees.

(b) Certificate of registration under the local Public Trusts Act, if the trust is a public
charitable trust, should be examined and a copy taken for record.

(c) The relevant extracts from the Instrument pertaining to the number of trustees,
operation of bank accounts and/or power of delegation should be entered in a register
in which copies or extracts of powers of attorney, particulars of death certificates, copies
of letters of administration, etc., are maintained (Form OD 127A). These particulars
should be checked and initialed by an officer. (It is not necessary to have a copy of the
whole Instrument on the Bank's record). The date and serial number under which the
record is maintained in the register should be noted on the account opening form/card
and at the head of the ledger account.

(d) A resolution in the form provided in Appendix XVIII or XIX or XX as may be

applicable, signed by ALL the trustees (whatever be the mode of operation) should be
obtained. If any change takes place in the board of trustees, a fresh resolution signed
by all the new trustees should be obtained.

(e) The confirmation of the balance in the account signed by all the trustees (whatever
be the mode of operation) should be obtained every six months.

(f) Details of Beneficial Owner should be taken, if any, otherwise take as nil.
(Refer Appendix IV).

(g) Periodical statements of accounts should be sent under a covering letter addressed
to all the trustees (whatever be the mode of operation).

When Trust Deed is Silent about Operation of a Bank Account

68.1 When the Trust Deed/Instrument does not contain any provision about the
operation of a bank account or authorizing the trustees to delegate powers to some of
them, the account can be opened, but should be operated upon by ALL THE
TRUSTEES JOINTLY.
82
68.2 Operations proposed by only some out of all the trustees : If, however, in such
cases the trustees request the Branch to allow the operations by only some out of all
the trustees, the matter must be referred to Head Office with a copy of the Instrument
and a status report on the standing, respectability and such other facts about the
trustees and also about the trust; the Branch should also state whether looking to such
factors the Bank would or would not take undue risk by allowing the operation of the
account by lesser number of trustees - that is to say, whether there are any chances of
the trustees committing breach of trust. The operation on the account by some of the
trustees and not all of them may be permitted in spite of there being no specific provision
in the Instrument; but in such a case the number of trustees operating must be at least
two and not one. If possible, an endeavor should be made to persuade the trustees to
agree to operate the account by a majority in number of the trustees.

Indemnity

69. If Head Office permits to open the account and allows operation by lesser number
of trustees, in addition to the documents mentioned above, a letter of indemnity
(Specimen-Appendix XXI) signed by ALL the trustees should be obtained. The letter of
indemnity is necessary only when there is no provision in the Instrument authorizing the
trustees to delegate their powers to some of them AND the trustees nevertheless desire
to operate the account not by all of them but by some of them If the operation is either
in accordance with the authority given in the Instrument or is by all the trustees jointly,
no indemnity is necessary.

Term Deposit and Safe Custody Accounts of a Trust

70. In a current or savings bank account, the trustees generally deposit the income of
the trust funds. Term Deposit and Safe Custody accounts on the other hand relate to
the capital of the trust funds. The following ADDITIONAL POINTS are, therefore, to be
considered while opening a Term Deposit or Safe Custody account in the name of a
trust:

(a) Sometimes the Instrument contains a provision authorizing the operation of "a bank
account" generally by some only of all the trustees. THE WORDS "A BANK ACCOUNT"
CANNOT NORMALLY BE CONSTRUED TO INCLUDE A TERM DEPOSIT ACCOUNT
OR A SAFE CUSTODY ACCOUNT. There must be either a specific mention of the
Term Deposit account or the Safe Custody account and specific mode of operation
prescribed in the Instrument, or there must be a general descriptive provision for such
an account, for instance, stating that the trustees shall have power to place the trust
moneys in Term Deposit with any bank or that they will have power to place the
investments of the funds in Safe Custody with any bank AND that any two or three of
them are authorized to deal with such Term Deposits or to withdraw the investments or
to instruct the bank to sell or otherwise deal with them.

83
(b) In the absence of such a provision as is referred to in (a) above or of a power of
delegation referred to in paragraph 66 above, the account should be operated by all the
trustees jointly. The request for the operation by some only of all the trustees should be
entertained more sparingly in the case of these accounts than in the case of Current or
Savings Bank accounts. If the Branch is inclined to accommodate the trustees, a
reference should be made to Head Office before opening the account. If Head Office
agrees to allow operations by some of the trustees, an indemnity should be taken in
addition to other usual documents referred above. THE FORM OF INDEMNITY WILL
BE FURNISHED BY HEAD OFFICE IN EACH CASE SEPARATELY.

General Principles and Precautions

71.1 With regard to trust accounts of any nature, the principle of treatment by a banker
is that he must not be knowingly a party to a breach of trust, otherwise he would be
liable or accountable to the beneficiaries or any person interested in the trust. In other
words, if an account holder places money that a banker knows is trust money in his
charge, the banker must not allow the account holder to draw out the money for a
purpose which the banker knows or has sufficient reasons to believe, to be inconsistent
with the account holder's duties as a trustee. On the one hand, the banker must not act
upon mere suspicion, on the other hand, he must not ignore a circumstance which
shows that the moneys are being drawn for a purpose not consistent with the duties of
a trustee. It is because of such onerous nature of the banker's liability regarding a trust
account that elaborate procedure is required to be followed.

71.2 The following are some of the precautions which arise from the abovementioned
general principles:

(a) A cheque payable to a trust account should not be collected for the private account
of a trustee. In no case should a trust account cheque be credited into the overdrawn
private account of a trustee himself.

(b) Branches should exercise caution in paying cheques drawn on trust accounts and
ensure that such payment does not contravene the provisions of the trust deed.

(c) Proceeds of the investments of the trust or Term Deposits should not be allowed to
be collected or paid into private account of a trustee.

(d) Trust accounts should not normally be allowed to be overdrawn Any request by
trustees or loan or overdraft arrangements should be referred to Head Office for
instructions, even when the amount is within the sanctioning power of the Manager.

(e) The trustees cannot appoint attorneys where, by so doing, they delegate the
exercise of their discretion except in terms of the clearest authority to do so under the
Instrument.

(f) Any one of the trustees may stop payment of a cheque whether he is the signatory
of the cheque concerned or not. If the trustees desire to remove the stop payment
84
instructions it is advisable to have them issued a new cheque, alternatively, instructions
cancelling stop payment may be accepted, if the letter is signed in the same manner as
cheques drawn on the account (Also refer Chapter on Current/Savings Bank Accounts-
General under "Stop Payment of Cheques").

Accounts of Executors and Administrators

72.1 The Executor or Administrator, as the case may be, of a deceased person is his
legal representative for all purposes, and all the property of the deceased person vests
in him as such.

72.2 An Executor is a person named in the Will and derives his title immediately upon
the testator's death for the purpose of administration of the deceased's property. Before
acting as Executor and exercising powers given to him under the Will, he should obtain
Probate from Court though there is nothing in the law to prevent him acting as Executor
under certain circumstances.

72.3 But, an administrator is the legal representative of a person who has died intestate
and derives his title wholly from the Court as per Letters of Administration granted in
his favor by the Court.

72.4 The Executor or Administrator cannot usually delegate power to third-parties. Any
power of attorney or an authority given to third-parties to operate on the account of the
estate must not be accepted without the prior permission of Head Office.

Procedure to Open Accounts

73.1 The Probate or Letters of Administration must be produced to the Bank before an
account can be opened in the names of Executors or Administrators (A Will for which a
probate has not been obtained should not be acted upon). Usually the original grant or
a copy certified by the Court should be produced for inspection and registration. If such
original or certified copy is not produced but only a plain copy is produced, the
registration thereof should be declined and the original or a copy certified as such by
the Court should be requested. The Executors or Administrators should be identified
before an account is opened in their names. The particulars of Probate or Letters of
Administration produced should be registered, i.e entered in a Register in which copies
or extracts from powers of attorney, particulars from death certificates, letters of
administration, trust deeds, etc , are maintained (Form OD 127A). The Register should
contain such particulars of the Probate or Letters of Administration as:

(a) Date of the Will, if any

(b) Date when the Probate or Letters of Administration were granted
(c) Name of Court which issued the grant
(d) Date when exhibited to the Bank and by whom
(e) Names of Executors or Administrators
(f) Gross value of the estate
(g) Powers of Executors or Administrators
85
(h) A brief extract of the contents of the Probate or Letters of Administration and the
accounts of business of the deceased with the Bank, if any.

73.2 The entry in the Register should be checked and initialed by the Manager (or at
larger Branches by the Deputy Manager/Deputy Chief Manager). The Register should
be indexed alphabetically. The date and the serial number in which the record is
maintained in the Register should be noted on the account opening form/card and at
the head of the ledger account under the initials of an officer.

73.3 The accounts of the Executors or Administrators should be opened in the following
style "A, B and C - Executors (or Administrators) of D".

Precautions

74. (a) Account opening form/card should be signed by ALL the proving Executors or
by ALL the Administrators, if there are more than one Executor or Administrator.

(b) Clear instructions for operation of the account signed by all Executors or
Administrators should be obtained.

(c) Care must be taken to see that the Bank is not involved in any misapplication of the
funds of the estate by the Executor or the Administrator. The Bank cannot examine
every payment out of the account but care should be taken where necessary
(depending on the surrounding circumstances concerning any transaction suggesting
misapplication of funds). It would be unwise to collect a cheque payable to the Executor
or Administrator as such for the private account of the Executor or Administrator. If the
Bank were pressing for a reduction in the private indebtedness of the Executor or
Administrator, it would be dangerous to accept for the credit of his private account a
cheque drawn by him on the estate account payable to self or to any third-party.

(d) Any one OVD should be taken from all the authorized persons.

Operation by Any One Executor or Administrator where Permissible

75. In the absence of any direction to the contrary in the Probate or Letters of
Administration, any one of the Executors or Administrators can operate on the account
without written authority from the others, as the co-executors or administrators are
regarded in law as one person. However, it is prudent to obtain their precise instructions
regarding operation on the account.

Accounts of Provident Funds

76.1 Accounts may be opened in the names of properly constituted Provident Funds.
The trust deed of Provident Fund should be examined carefully to ensure that there are
no onerous provisions in it. The Rules of the Provident Fund should also be read
86
carefully to see that they do not place any onerous responsibility on the Bank.

76.2 The Provident Fund must have recognition under the Income Tax Act, 1961. The
trustees should be well-known and respectable persons of standing.

76.3 All instructions regarding opening of trust accounts and precautions thereto shall
also apply to these accounts (Refer paragraphs 63 to 71).

76.3.A. Savings Bank Accounts in the name of Employees Provident Fund

organizations/Gratuity Funds of Public/Private Limited Companies can be opened
provided that :

i) The fund is recognized Provident/Gratuity Fund within the meaning of chapter IX A of

Income Tax Act 1922,
ii) The entire Income of the fund is exempted from Income Tax and

iii) The funds do not fall within the categories of bodies mentioned in clause 3

(i) of RBI direction dated 27-12-85 reproduced below "No bank shall open a Savings
Deposit Account in the name of Government Departments/bodies depending upon
budgetary allocations for performance of their functions/Municipal
Corporations/Municipal Committees/Panchayat Samities/State Housing Boards/Water
/Sewerage/Drainage/Boards, State Text Book Publishing Corporation/Societies
/Metropolitan Development Authority/State/District Level Housing, Co-op Society etc or
any trading or business concern whether such concern is a proprietary or a partnership
firm / or a company or an association.

76.4 The following documents together with the usual account opening form/card
should be obtained:

(a) The original trust deed (which may be returned after its registration in the Bank's
record). A copy should be obtained for Bank's record.

(b) A copy of the rules of the Provident Fund.

(c) A copy of the resolution, certified true by the Chairman of the meeting at which it
was passed by the Board of Trustees authorising opening of an account with the Bank
and conferring authority on the trustees of the Fund, who, in accordance with the rules
of the Fund are authorised to sign cheques etc.

Any one OVD evidencing should be taken from all the authorized persons.

Accounts of Liquidators
77.1 A Liquidator under a VOLUNTARY WINDING UP of a Company may open an
account with the Bank subject to the consent of the Committee of Inspection, if any, and
need only produce a copy of the resolution (certified by the Chairman of the meeting at
which the resolution of such winding up was passed) of the creditors or members of the
87
Company appointing him The Liquidator's account should be opened in the following
style:

"The Liquidation Account of ………. Company Ltd" or "(Company Pvt. Ltd.)"

77.2. Liquidators cannot delegate their powers to third-parties. Where more Liquidators
than one are appointed, they may not authorise less than two of their number to sign
generally unless empowered to do so at the time of their appointment, although they
may all authorise one of their members or a third-parties to sign a particular document.

77.3 In case of account of Official Liquidator who is the Liquidator of a Company which
is being WOUND UP UNDER THE SUPERVISION OF THE COURT, "Public Account
of India" in the Reserve Bank of India must be used (Section 552 of the Companies Act,
1956).

77.4 Neither the Official Liquidator nor any other Liquidator of a Company shall pay any
moneys received by him in his capacity as such into any private banking account
(Section 554 of the Companies Act, 1956).

Accounts of Other Banks

78.1 Branches may, at their discretion, open Current Accounts only of other
scheduled banks including Regional Rural Banks, in case of doubt, they should refer to
Head Office. No account of a non-scheduled bank may be opened without reference to
Head Office.

78.2 The Bank is readily prepared to open current accounts of good foreign banks. But,
such requests to open current accounts should ordinarily be referred to Head Office.
Good business may result from such accounts and from acting as agent for foreign
banks. In opening and maintaining current accounts of foreign banks, the necessary
Exchange Control permission should be obtained and regulation of Reserve Bank of
India must be observed.

Accounts of State Financial Corporations

79.1 Accounts of State Financial Corporations may be opened. Before opening an

account, the following documents should be obtained.

(a) A copy of the relevant Act of Legislature,

(b) A copy of the Bye-laws and

(c) A certified copy of the resolution regarding opening and operation of the account It
should be seen that the terms of the resolution are in agreement with the relative
provisions in the Act and Bye-laws.
(d) Any one OVD should be taken from all the authorized persons.

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79.2 It should be ensured at all times that the accounts are conducted in conformity
with the rules and regulations.

Collection Accounts

80.1 Sometimes, an account holder e g Company, Sales Organization, Life Insurance

Corporation of India, etc., may request the Bank to collect moneys/cheques etc.,
deposited by their representatives and/or general public at centers where the Bank has
Branches and to transfer such collections at specified intervals to their main account at
a specified Branch/bank.

80.2 Before opening such an account, Branches should refer to the Zonal Office for
approval Zonal Office will fix the terms and conditions depending upon the value of the
account to the Bank as a whole. That office will also fix the exchanges on transfer of
funds from the collecting centres to the main Branch of the Bank at which the collections
are to be centralized.

80.3 Collection account is non-operating current account and no transaction other than
remitting funds to the main account should take place (cheque book should not be
issued). Actual postages incurred in remitting the funds and also the exchange as per
agreed terms should be recovered from the account holder.

80.4 All the usual formalities connected with the opening of an account are to be
observed in this type of account also, with an exception that the main Branch at which
the collections are to be centralized will supply the usual forms and verified specimen
signatures to the Branch where the collection account is to be maintained.

80.5 Opening of this type of account should be restricted to well-known and respectable
parties.

II. INTRODUCTION OF ACCOUNTS

81. If proper and valid KYC / OVD documents are submitted by the customer, then
no need of introduction. But, branch should carry out basic and proper due
diligence in regard to identity, address and occupation/profession of the
customer as per laid down KYC norms/policy.
82. Branches should guard against undesirable current accounts being transferred to
them from other banks. It may be advisable in such cases to refer to those banks from
which the accounts are being transferred. However, much depends upon the known
facts of the case. Where the account is canvassed by the Branch, such a reference
may be unnecessary.
83.1 Transactions of big amounts in such accounts should be carefully scrutinized at
least for a period of six months to see that the account is conducted satisfactorily.
Having regard inter alia, to the occupation / standing and means of account holders,
the transactions passing through the account should not be such as would reasonably
put the Bank on inquiry. It may be particularly seen whether the new account has been
exclusively used for collection of third-party cheques. Immediate withdrawals of large
89
amounts may also attract attention. When cheques for large amounts are deposited for
collection after the account is opened with a small initial cash deposit, particular care
should be taken and full enquiries made to establish the genuineness of the
account/transaction etc. Branches should report unusual characteristics or features of
any account to their higher controlling authorities particularly the accounts where there
may be large deposits or large withdrawals in cash although there may not be any
ostensible reasons to justify such transactions. Controlling authorities should make a
note of such accounts to facilitate watch and timely action, wherever necessary, in the
interest of the Bank and the banking system.

83.2 A watch can easily be kept by the clerk making the entries as well as the officer
authorizing the transactions intelligently so that any attempt to fraud could be detected
in good time.
83.3 (i) To safeguard the Bank / Branch Manager against frauds it will be the primary
responsibility of the in-charges of the Deposit section/Department to authenticate the
opening of new accounts and thereafter permit deposit of cheques/instruments and
issuance of cheque books, monitor such accounts.
(ii) Close monitoring of cash deposits and withdrawals for substantial amounts say
Rs.50, 000/- and above in rural branches, Rs.1, 00,000/- and above in Semi Urban
branches, Rs.5 Lakhs and above in Urban branches and Rs.10 Lakhs and above in
Metropolitan branches in the accounts should be done. However, branch should closely
and carefully monitor all cash transactions. Monitoring should be done by the cheque
cancelling/ transaction authorizing and authorities as mentioned in sub-para (i) above.
(iii) The above mentioned transactions should be scrutinized periodically, say, every
fortnight, by the Manager, Chief Manager, Assistant General Manager and test checks
of newly opened accounts should be carried out.
Such transactions of Rs. 10 lacs and above should be reported to their Zonal Offices in
the prescribed format on fortnightly basis. Zonal Offices should scrutinize the details of
such transactions reported by the branches and look into any particular transaction
which appears to be prima facie of dubious nature or giving rise to suspicion. Zonal
Offices in turn, should apprise Zonal Inspection and Audit Department if any
transactions of suspicious nature are observed. A monthly Cash Transaction Report
(CTR) is sent to FIU-IND, before 15th of next month, involving cash transactions more
than Rs 10 Lakhs in a single transaction or series of transactions, in Indian Currency or
its equivalent in foreign currency. A monthly Suspicious Transaction Report (STR) on
financial and non- financial transactions/matters is also sent to FIU-IND within 7 days
from the date decision is taken by the screening committee. A monthly Counterfeit
Currency Report (CCR) is also sent to FIU-IND. Record of transactions reported in the
Cash Transaction Report (CTR), Suspicious Transaction Report (STR), Counterfeit
Currency Report (CCR) should be preserved for a period of atleast five years from the
date of transaction between the Bank and the client.

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 III. Filling in of the Account Opening Form/Card

84.1 All depositors desirous of opening any type of deposit account should complete
relative Account Opening Form fully, in all respects with full name(s), full signature(s)
and specimen signature(s) at appropriate places. In the case of firms or companies, full
names, signatures and specimen signatures should be of persons authorized to operate
on the account. The officer should examine the account opening form/card etc., to see
that the depositor(s) has signed/completed it properly, has given the required
particulars against each head and that alterations on the account opening forms etc.,
are duly authenticated under the initials of all the account holders.

To fall in line with the RBI’s guidelines on Know Your Customer (KYC) policy the
account opening form has been modified (Enclosed Appendix I). The Branches are
required to obtain the revised account opening form while opening Savings Bank,
Current Account, all types of term deposits, BOI Savings Plus, BOI Current Plus,
Overdraft and Cash Credit account.

A new form is to be obtained at the time of opening of accounts for new customers. And
for opening an additional account in an existing account title, only additional account
opening form is to be obtained. For example, if A and B have earlier opening Savings
Bank Deposit Account where this new form has been obtained, in case they desire to
open a Term deposit account, the additional form need only to be obtained. The new
account opening form should be obtained in all existing accounts also in a phased
manner.

84.2 As pass books of current deposit, savings bank deposit and recurring deposit
accounts are now printed without the Rules, a separate printed copy of the Rules is
given to the account holders at the time of opening of the account who are required to
sign it. A printed copy of the rules duly signed by the account holder should be properly
filed in a separate box file or pasting file after writing prominently the account number
at the top of it on the right hand side for easy reference. An extra copy of the rules may
be supplied to the account holder, if so desired.

85. The officer must ensure that every signature appearing on the form and also on any
other forms taken, such as, partnership letters, etc., is authenticated by his initials in
red ink/ball-point pen. It is not sufficient to say “signature verified” and to initial once
only on the account opening form/card. The signature(s) of the introducer should also
be verified by an authorized officer with as much care as is required to verify the
signatures of drawers of cheques. The account opening official should, in addition to
his initials authenticating the signatures of the account holders and the introducer, affix
his full signature in red with the serial (code) number, against an appropriate legend
“Account opened by ........”. Branches where Special Assistants (who do not have
signing authority) are entrusted with the work of opening of accounts should, after
signing against the legend “Account opened by ........” write their full names against
code number.
91
86. As far as possible, the account opening form/card should be completed in the
presence of an officer of the Bank. The facility of sending account opening form/card to
be completed and signed outside the Branch should be extended with circumspection
to depositor(s) well-known to the Branch and the signature(s) on the account opening
form/card verified with the specimen signature on record in respect of their other
account(s), if any. It is advisable to write the name(s) of the proposed account holder(s)
on the account opening form/card before handing it over for completion outside the
Branch.
87.1 Signatures in Capital letters or Distinct Disjointed Alphabets: Such signatures are
exposed to risk and can be easily forged. This should be explained to the customer at
the time of opening account. If, however, the customer insists on giving such specimen
signatures, he should be asked to give his recent photograph additionally. Branches
should complete other formalities as detailed in paragraph 33 to 35 of this chapter when
such photographs are obtained.
87.2 Vernacular Signature: Signature(s) in the regional languages known to the
Branch can be accepted provided the signature(s) is steady and natural. In case an
employee comes across a signature in a language not known to him, he could always
take the assistance of some other employee at the Branch who knows the language for
the purpose of verification of the specimen signature. In such instances particular
attention should be given to the Strokes in the signature.
Special Instructions
(1) Deposits Accounts
88.1 The types of operational instructions called “Special Instructions” are printed on
the account opening form/card. It is necessary to obtain clear and unambiguous
instructions regarding the mode of operations on the form/card under the signature(s)
of all the depositor(s). The inapplicable wordings of special instructions should be
deleted/scored through neatly under proper authentication of the depositor(s). A line
should be drawn across any unused space left on the form/card to ensure that
unauthorized insertions are not made subsequently.
88.2 The instructions in paragraph 99 in the same chapter apply to accounts of
individuals. Special instructions in paragraph 89 below are applicable to all other types
of deposit accounts in addition to current accounts.

(2) Current Accounts

89. The different types of special instructions which can be given in current accounts
are given below:

(a)Joint Current Accounts

(Other than “Former or Survivor” accounts)
‘The account will be operated upon by **, cheques and orders to pay will be drawn and
signed by, securities, if any, deliverable to balance
Payable to ** (**One of the applicable wording (a) to (d) given down should be inserted
here.
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(a) Either or Survivor OR
(b) Both of us jointly or survivor
I Any one of us or any one of the survivors of us or last survivor
(d) Any two of us or any two of the survivors of us or last survivors etc.

(b) Former or Survivor Accounts

“The account will be operated upon and cheques and orders to pay will be drawn and
signed by and the balance will be repayable to the former i e, the first named account
holder Mr./Mrs./Miss ………………..during his/her life time and only after his/her death,
by and to the second named account holder Mr. /Mrs. /Miss …………………………if
then surviving”

I Other Accounts

In the accounts of Proprietorship, Partnership Concerns, Joint Hindu Families, Limited

Companies, Associations, etc, special instructions should be obtained as under
“The account will be styled as ------------------------------------ (write the full title of the
account) and will be operated upon, cheques and orders to pay will be drawn and
signed by --------------
* (i) Proprietorship concern – “the sole proprietor Mr. XYZ”

* (ii) Partnership firm – “any one (or any two/three) of the partners”

* (iii) Joint Hindu Family – „Karta“

* (iv) Limited Company, Association, etc – The exact instructions regarding the
operations on the account giving reference to the resolution of the Board of Directors
or the Governing Body, as the case may be, should be stated.
(For further details refer relevant paragraphs in “Types of Accounts”).

(3) Joint Accounts of Three Persons with Special Instructions “Former or

Survivor”

90.1 The wording as under should be affixed as an along to the specimen signature
cards.

Savings bank Accounts:

“Former or Survivor” that is, by the account-holder first named on this card during
his/her life-time and only after his/her death by (i) both the second and third named
account-holders jointly or by the survivor of them OR (ii) by either the second named
account-holder or the third named account-holder or by the survivor of them OR by the
93
second named account-holder only if alive or by the survivor of the second and third
named account-holders.
Note : There are certain Government Departments, Semi-Govt. or Quasi Govt. Bodies,
local Bodies and certain organizations engaged in Public Utility services e.g. State
Housing Boards, State Electricity Boards etc. which are not liable to pay income tax
under Income Tax Act 1961. However, these institutions/organizations receive grants,
loans or subsidies from the Government and therefore, depend on budgetary allocation
for performance of their functions. As such they do not qualify for payment of interest
and hence savings bank accounts cannot be opened in their names. These includes
local bodies like Municipal Corporations, Zilla Parishads, Taluka Panchayats and gram
Panchayats etc. Hence no branch should open Savings Bank account in the name of
Govt. Departments/bodies depending upon budgetary allocations for performance of
their functions/Municipal Corporations or Municipal Committees/Panchayat
Samitis/State Housing Boards/Water and Sewerage/Drainage Boards/State Text Book
Publishing Corporations/Societies/Metropolitan Development Authority/State/District
Level Housing Co-operative Societies etc. or any political party or any trading /business
or professional concern, whether such concern is a proprietary or a partnership firm or
a company or an association.
However, as exception RBI allows the Banks to open savings bank accounts in the
names of State Government departments/bodies/agencies in respect of grant/subsidies
released for implementation of various programmes /schemes sponsored by Central
Government/ State Government on production of an authorization to the bank from the
respective Government Departments certifying that the concerned Government
Department or body has been permitted to open savings bank account. Banks while
opening such accounts under savings bank, should keep on their record a copy of the
authorization issued by the respective Central / State Government departments. (Ref: -
RB1/2005-06/399 RPCD.CO.RF.BC.No.87/07.38. 01/2005-06 dated June 6, 2006 &
RPCD.RF.Dir.5516/07.38.01/2005-06 June, 2006)

Term Deposit Accounts:

“Former or Survivor”, that is, to the account-holder first named on this card during
his/her lifetime and only after his/her death to (i) both the second and third named
account holders jointly or to the survivor of them OR (ii) to either the second named
account-holder or the third named account-holder or to the survivor of them OR (iii) to
the second named account-holder only if alive or to the survivor of the second and third
named account-holders.
90.2.1.1 Branches should note

i) To obtain the signatures of the account holders both on account opening cards and
on the along and

ii) To mention on the cards “Operational Instructions attached”.

Noting Brief Special Instructions on Account Opening Form/Card

91.1 For drawing the attention of the cancelling officer, the operational instructions
94
should be prominently but briefly indicated against specimen signatures of depositors
on the form/card in red ink/ball-point pen by the officer opening the account.

‘E or S’ For ‘Either or Survivor’

‘F or S’ For Former or Survivor’
‘Jointly’ For ‘both of us Jointly or Survivor’
‘Anyone of us or anyone of the
‘Any One’ For
survivors of us or the last survivor’
Any two of us or any two of the
Any two jointly’ For survivors of us or the last survivor
etc.

91.2 If there is similarity in the name(s)/title(s) of two or more accounts, the word “care”
should be written in red ink/ball-point pen in bold letters on the top of the relative account
opening forms/cards. The account holders of both the accounts should also be
requested to write the full titles of the accounts on cheques and paying-in-slips and to
adopt a distinct mode of signature or employ a distinguishing code in addition to the
usual signature in order to distinguish accounts from one another.

Other Items to be completed on the Form/Card

(a) Occupation

92.1 The occupation should not be given briefly as “Business”, “Service”, “Trade” or
“Industry”. The account holder must describe his occupation in definite terms e. g.
“Accounts Officer in A B & Co” or “Manufacturers and Importers of Mechanical,
Electrical, Textile, Chemical and Pharmaceutical goods" or "Importers and dealers in
Mill Stores and Machinery", etc.
92.2 If an account holder is in service, all details about his/her post and name and
address with telephone number, if any, of the employer should be noted on the account
opening form/card.

92.3 In the case of an account of a married woman, the occupation of the husband, and
the name and address of his employer, if any, should be ascertained tactfully and noted
on the account opening form/card.

(b) Address
93.1 The address must be full and complete - the name and the number of the building,
number and/or name of the lane or street, post bag/post box number, the number of the
postal district, city/town and pin code, etc., are to be stated accordingly to ensure that
no deposit is accepted in "benami" or fictitious names to evade income tax.

93.2 The account holder's address, where he desires correspondence from the Bank
to be addressed to him, should be recorded.
93.3 In the case of a joint account, the address of the first named in the account is
usually recorded. Should the account holders desire otherwise, there can be no
objection to recording the address of such other account holder(s) as may be desired
95
by all the account holder(s) under their joint signature(s).

93.4 Sometimes friends and relatives of members of the staff open accounts with the
Bank and give addresses, care of the members of the staff at the Bank. This should not
be accepted.

93.5 To ensure correctness of the address given in the account opening form/card,
Branches should send by ordinary post, a letter of thanks to the account holder, soon
after the new account is opened. In case the letter of thanks is returned undelivered by
the postal authorities, necessary enquiries should be made about the customer from all
possible sources. In the meantime, operations in this account should be closely
monitored and extra precaution taken in handling the account.
We need to segregate the documents as per KYC category (Normal, Simiplified & small
KYC) (Refer point 23.3 for the same)
The proof of address /identity may be submitted by the account holder in any of the
following forms:

A) For proof of identity & address (any one of the following for verification along
with a copy): For customers who are natural persons, the branches shall do Basic
Due Diligence by obtaining sufficient identification vide self-attested copy of one of the
Six OVDs, verified by original, along with Customer Profile Sheet(CPS) to ascertain :-
Identity, address etc.

 Letter issued by the National population Register containing details of name and
address
 Passport (within validity period)
 Voter’s Identity Card issued by Election Commission of India
 Driving License ( within validity period)
 Job Card issued by NREGA signed by an officer of the State Govt.
 Proof of Possession of Aadhaar Card

And one recent photograph (self-attested), other information pertaining to nature of

business or financial status for the purpose of Customer Profile Sheet (CPS).

e-KYC service of Unique Identification Authority of India (UIDAI) is accepted as a valid

process for KYC verification- information provided by UIDAI. As a result e-KYC is
treated as OVD under PML rules.

B) Where the OVD furnished by the customer does not have updated address,
the following documents shall be deemed to be OVDs for the limited purpose of
proof of current address (any one of the following for verification along with a
copy): Address proof for limited purpose,

1. Utility bill which is not more than two months old of any service provider (electricity,
telephone, post-paid mobile phone, piped gas, water bill);
2. Property or Municipal Tax receipt;
96
3. Pension or family pension payment orders (PPOs) issued to retired employees by
Government Departments or Public Sector Undertakings, if they contain the address;
4. Letter of allotment of accommodation from employer issued by State or Central
Government departments, statutory or regulatory bodies, and public sector
undertakings, scheduled commercial banks, financial institutions and listed companies
and leave and license agreements with such employers allotting official
accommodation.
 The customer shall submit OVD with current address within a period of three
months of submitting the documents specified at above
 In case of individual who does not have address proof in his/her name, a declaration
from close relative with whom he/she resides and whose identity proof and address
proof are obtained

C) Simplified KYC norms (Please see the guidelines of compliance Dept):-

Documents for “Low Risk” customers may be obtained for verifying the identity and shall
be deemed as officially valid document(OVD) :-
 Identity Card with applicant photograph issued by the Central/State
Govt.Deptts.,Statutory, /Regulatory Authorities
 Letter from a Gazetted Officer verifying the identity and attesting photograph and
address And recent photograph(self-attested)

93.6 It is observed that some close relatives e.g. wife, son, daughter, parents etc. who
live with their close relatives viz. their husband, father/mother, son/daughter etc. as the
case may be, were finding difficulty in opening their accounts with Banks as utility bills
required for address verification were not in their names. As clarified by RBI, Branches
can obtain an identity document and a utility bill of the respective relative with whom
the prospective customer is residing along with a suitable declaration from the relative
that the said prospective customer is a relative and is staying with him/her. Branches
can thereafter proceed with opening of the account/s of such prospective customer/s.
They can also use any supplementary evidence such as a letter received through post
for further verification of the address. While dealing with such cases Branches should
keep in mind the spirit behind the instructions issued by the RBI and ensure that no
undue hardship/harassment is meted out to such individuals.

Initial Deposit
94. An account should ordinarily be opened with an initial deposit of cash. The Manager
(or the Deputy Manager/Deputy Chief Manager at larger Branches) may accept, at his
discretion a cheque drawn by the prospective account holder on his own account with
another bank as initial deposit. A cheque drawn in favor of a prospective account holder
by a third-party should not be accepted unless the prospective account holder is well-
known to the Bank or is introduced by a customer of good standing and well-known to
the Bank. A cheque drawn in favour of a third-party should not, as a rule, be accepted
as an initial deposit.

Approval of ACCOUNT Opening forms/Cards

95.1 The Officers/Special Assistants opening the Current Accounts/Savings Bank

97
Accounts/Term Deposit Accounts should verify the signatures of the
customers/introducers as per the existing instructions. The account opening official, in
addition to initialling (as his authentication) against every signature of the customer on
the account opening form/card should affix his full signature in red with the serial (code)
number against appropriate legend "Account opened by ………………. ". Thereafter,
the account opening form/card should be submitted to the following designated
authorities for approval/authentication.

Category of Branch Account opening form to be approved/authenticated by

Small Manager
Medium Branch Manager/ Manager (Administration)
Large Senior Branch Manager/Senior Manager (Administration)
Very Large Senior Manager (Deposits/Deputy Manager (Deposits) if any
Exceptionally Large Senior Manager (Deposits/Deputy Manager (Deposits) if any
95.2 Approval of account opening form/card is tantamount to approval for opening of
account and due care must, therefore, be exercised by the concerned officer. The
officer approving/authenticating the account opening forms/cards should ensure that
the specimen signatures of prospective account holders and introducers are individually
authenticated by the officer opening the accounts and thereby he should satisfy himself
that the instructions obtained for operation on accounts are acceptable to the Bank. He
should also check whether the official opening the account has superimposed his full
signature (in red) with the serial number. Thereafter, he should initial the account
opening form/card in token of his having checked it. It would be the responsibility of the
officer approving/authenticating the account opening forms/cards to see daily without
fail what accounts are opened and to satisfy himself about the genuineness of the
introduction.
95.3 The scrutiny/approval of current account opening forms should precede the
opening of the account. But in the case of Savings Bank/Term Deposit Accounts, such
scrutiny may be done after the account is opened but before opening of the account
in the computer system.
95.4 Branch Managers of Exceptionally Large, Very Large Branches should carefully
note to include scrutiny of the account opening forms/cards in their periodic Test Checks
in order to ascertain the quality of supervision at the Branch.
Additional Documents:
Please also refer and follow our Bank’s Deposit Policy- and thereafter if any
amendments/ changes/ new policy from time to time.
Please also follow KYC and AML guidelines/norms/policy and Central KYC Registry
guidelines from time to time.
96. In addition to account opening form/card, additional documents are required to be
taken in deposit accounts a list of such accounts and additional documents to be taken
is given below for ready reference.
Any one of the following documents should be obtained to confirm the present address
of the applicant as mentioned in the application form. But any one OVD and recent
photograph should be taken from all the authorized persons along with Customer Profile
Sheet in all accounts and details of Beneficial Owner in all eligible accounts.
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 Types of Accounts Additional Documents

i) Individual Accounts (a) Passport copy ( within validity)

(b) Voter’s ID card issued by Election Commission of India
(c) Driving Licence ( within validity)
Letter issued by the National population Register containing details of name
(d)
and address
(e) Proof of possession of Aadhaar Card
(f) MNAREGA Card
ii) For Senior Citizens (a) Passport Copy(within validity)
(b) School Leaving Certificate
(c) Voter’s ID
(d) LIC policy
(e) Employment Discharge Card issued by PSUs
(f) Any other document acceptable to branch

(iii Partnership Firms i) Partnership Letter (Form L 438),

ii) Partnership Deed
iii) Registration certificate of firm (in case of advance a/c.
Joint Hindu Family Letter (Form CD 115) in case of a/c. of business or trading
(iv Joint Hindu Families i)
nature
Joint Hindu Family letter (Appendix VI in case of deposit a/c of non trading
ii)
nature
(v Limited Companies (a) Certificate of Incorporation,
Certificate of Commencement of Business (Not required in case of Private
(b)
Companies or Companies Limited by Guarantee),
(c) Memorandum and Articles of Association,
(d) Board Resolution,
Latest audited Balance Sheet and Profit and Loss Account (in case of a
(e)
Public Limited Company)
f) A list of present Director signed by Chairman
Clubs, Schools, Societies
(a) Certificate of Registration or Incorporation (if registered), Certificate from
(vi) (including Co-operatives),
(b) Registrar of Co-operative Societies, wherever necessary,
Associations, Committees etc
(c) Bye-laws, Rules, Regulations, etc, as the case may be,
(d) Memorandum of Association, if any,
(e) Resolution, (Appendix XII or XIII)
Latest copy of the Balance Sheet in case of Cooperative Societies, if
(f)
available

Types of Accounts Additional Documents

(vii) Trusts (a) Original Trust Deed for verification. Copy to be kept on file.

(b) Instrument or Document of Trust or relevant extract thereof,

(c) Resolution, (Appendix XVIII or XIX or XX )
(d) Certificate of Registration from Charity Commissioner (if trust is a Public
Charitable Trust)
Probate or Succession Certificate or Letters of Administration or Administrator
(Viii) Executors and Administrators
General's Certificate
(IX) Provident Funds (a) Trust Deed,
(b) Rules of the Provident Fund,
(c) Resolution
(X) Liquidators (voluntary) Resolution

(XI) State Financial Corporations (a) Relevant copy of Act or Legislation,

(b) Bye-laws, if any,
(c) Resolution

Guardians appointed by Court in

(XII) Court order or Guardianship Certificate
respect of Minors

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(For further details refer relevant paragraphs in "TYPES OF ACCOUNTS")
Bills 1005 in all a/cs except Savings bank, and Tem Deposit accounts.

Branches are advised to open pension account in the name of pensioner as first holder
and joint name of his/her spouse provided the spouse’s name appears on Pension
Payment Order (PPO).

Note : There are certain Government Departments, Semi-Govt. or Quasi Govt. Bodies,
local Bodies and certain organizations engaged in Public Utility services e.g. State
Housing Boards, State Electricity Boards etc. which are not liable to pay income tax
under Income Tax Act 1961. However, these institutions/organizations receive grants,
loans or subsidies from the Government and therefore, depend on budgetary allocation
for performance of their functions. As such they do not qualify for payment of interest
and hence savings bank accounts cannot be opened in their names. These includes
local bodies like Municipal Corporations, Zilla Parishads, Taluka Panchayats and gram
Panchayats etc. Hence no branch should open Savings Bank account in the name of
Govt. Departments/bodies depending upon budgetary allocations for performance of
their functions/Municipal Corporations or Municipal Committees/Panchayat
Samitis/State Housing Boards/Water and Sewerage/Drainage Boards/State Text Book
Publishing Corporations/Socities/Metropolitan Development Authority/State/District
Level Housing Co-operative Socities etc. or any political party or any trading /business
or professional concern, whether such concern is a proprietary or a partnership firm or
a company or an association.

However, as exception RBI allows the Banks to open savings bank accounts
(Refer point 23.3 for same)

Customer Acceptance Policy

97. Accounts of the following customers will not be opened:

-Account(s) of anonymous/fictitious /benami name(s).
-Account(s) of persons with criminal background and/or having connections with
terrorist organization(s).

98. Basic and proper due diligence should be carried out by the branches in regard to
identity, address and profession/occupation etc. Of the customer, but, while carrying
out due diligence, it should be ensured that the procedure(s) adopted will not result in
denial of banking services to the general public especially those who are financially or
socially disadvantaged.

99. Proper verification of the related documents/identification of the customer is a pre-

requisite before accounts of new customers are opened and more importantly,
before existing accounts are closed. Customer identification procedure(s) should be
meticulously followed.

100
100. The Customer Identification Procedure(s) is/are to be undertaken while
establishing a banking relationship or when it is necessary to obtain additional
information from the existing customers based on the conduct or behavior of the
account.

101. The Customer Identification Procedure(s) is/are to be undertaken also in respect

of non-account holders approaching Bank for high-value one-off transaction.

102. It should be ensured that sufficient information is obtained on:

- the name of the account holder,

- nature of business activity,
- Location (address, phone numbers, fax numbers, etc,),
- mode of payments,
- volume of turnover,
- Social and financial status, etc,
103. Information collected at the outset for purpose of customer identification
and profiling would include:
- The purpose and reason for opening the account or establishing the
relationship.
- The anticipated level and nature of the activity that is to be undertaken;
- The expected origin of the funds.
- Details of occupation/employment.
- Sources of wealth or income.

KYC Documentation for Low Income Customers (Small Account) in both Rural
and Urban Areas:

104.1RBI has simplified the KYC procedure for opening accounts (Small Accounts) of
those persons belonging to low income category in both rural and urban areas who are
unable to satisfy the Bank about their identity and address (by means of any of the
above-stipulated documents or by providing suitable introduction by an existing
customer), and therefore are unable to open any account with the Bank. In such cases,
Bank may rely on any other satisfactory evidence as to the identity and address of the
customer.

104.2However, such accounts opened are subject to following conditions:

- Balances in the said customers’ all accounts put together not to exceed
Rs.50,000/-.

- The total credit in all accounts put together also not to exceed Rs.1,00,000/-.

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 - If either of the above ceiling is exceeded, branches have to follow the usual
documentation formalities (like obtention of documents as prescribed in III
above).Debits in a month should not be more than Rs 10000/- and no foreign
remittance allowed in these accounts.
- The customer has to be made aware of this requirement (of full KYC
procedures) and that transactions cannot be allowed in the accounts, in the
event the above ceilings are exceeded. Customer has to submit KYC
documents within one year or he/she can submit proof for applying KYC, subject
to branch satisfaction, then such account can be allowed for next one year
subject to above ceilings/conditions.
- Branches should advise the customer in advance immediately when the
balance reaches Rs.40, 000/= or the credit total reaches Rs.80, 000/= so as to
alert him about the need for immediate compliance with full KYC procedures.
- Operations would otherwise be stopped if customer fails to comply with this
requirement.

104.3These simplified document formalities would be applicable also to the persons

affected by natural calamities like floods etc and who have been given grants etc by
State/Central govt.s. The initial credit of such grants shall not be counted towards the
total credit (of Rs.1 Lakh stipulated above).

IV. DEPOSIT LEDGERS: WRITING, POSTING, CHECKING AND BALANCING

Computer Systems
105.As all our branches are on CBS platform, hence opening of accounts, signature,
thumb impression and photograph scanning, posting of transactions/any data entry and
verification/checking of transactions/ any data entry are being done through the
computer system on the basis of maker and checker concept/norms. Balancing is also
being done through the system. Back up of all records/transactions should be kept at
appropriate levels, besides safe keeping the hard copies of all
documents/vouchers/account opening form etc.

Opening of New Accounts

106. All particulars of account holder(s) such as the full name(s) (i e title of account),
address, telephone number, operational instructions, other special instructions given by
the account holder(s) e.g. the frequency of periodical statement etc., should be
recorded from the account opening form/card and cheque book series numbers (where
applicable) should be recorded/noted from cheque request form. The title of the account
should be spelt and styled exactly as in the relative account opening form/card. In the
case of a joint account, the names of all the account holders should be written. In the
cases of sole proprietary concerns or partnerships trading under impersonal names or
in names other than their own, it is desirable that the style of the account as entered in
the Account head should show the connection of the proprietor or partners of the
concern, e.g. Rainbow Trading Co, A B, Proprietor or Partner and not simply the
Rainbow Trading Co. The names of partners should be noted in the Account in the case
of partnership accounts. All entries in the account must be entered and verified by
102
checking Officer. Operational Instructions should be properly verified in the system by
the checking officer.

(a) Current Accounts

107. If there are accounts with similar names, the words “Care: similar account (Title
of the other similar account)" should be mentioned in all the concerned accounts. The
account holders should be requested to use rubber stamps to affix the full title of the
accounts on their paying-in-slips and cheques. They might also be advised to write a
distinguishing code in addition to their usual signatures.

(b) Savings Bank Accounts

108. Now it is being opened through the computer system.

Note : There are certain Government Departments, Semi-Govt. or Quasi Govt. Bodies,
local Bodies and certain organizations engaged in Public Utility services e.g. State
Housing Boards, State Electricity Boards etc. which are not liable to pay income tax
under Income Tax Act 1961. However, these institutions/organizations receive grants,
loans or subsidies from the Government and therefore, depend on budgetary allocation
for performance of their functions. As such they do not qualify for payment of interest
and hence savings bank accounts cannot be opened in their names. These includes
local bodies like Municipal Corporations, Zilla Parishads, Taluka Panchayats and gram
Panchayats etc. Hence no branch should open Savings Bank account in the name of
Govt. Departments/bodies depending upon budgetary allocations for performance of
their functions/Municipal Corporations or Municipal Committees/Panchayat
Samitis/State Housing Boards/Water and Sewerage/Drainage Boards/State Text Book
Publishing Corporations/Societies/Metropolitan Development Authority/State/District
Level Housing Co-operative Societies etc. or any political party or any trading /business
or professional concern, whether such concern is a proprietary or a partnership firm or
a company or an association. However, as exception RBI allows the Banks to open
savings bank accounts. (Refer Point 23.3b)
(Ref:-RB1/2005-06/399 RPCD.CO.RF.BC.No.87/07.38.01/2005-06 dated June 6,
2006 &RPCD.RF.Dir.5516/07.38.01/2005-06 June, 2006)

(c) Other Accounts

109. Other deposits accounts viz., Term Deposits, Monthly Income Certificates, Double
Benefit Deposit Certificates, Recurring Deposits, etc also are being opened through the
computer system with all the necessary related details.

Posting through computer system

110 The transactions must be posted up to date, accurately and authenticated in the
same evening. Now transactions should be posted and verified through the computer
system as per maker and checker concept/norms.

103
 Precautions in Posting Credit/Debit Entries

111. Before cheques/withdrawal forms, paying-in-slips or vouchers are posted in the

system it should be ensured that the account number (where applicable) written/printed
on cheques/withdrawal forms, paying-in-slips or vouchers is the same. Now
transactions should be posted and verified through the computer system as per maker
and checker concept/norms.

112. The computer operator must enter full particulars of debit/credit entries under the
column `Particulars'

Checking through computer system

113. When checking transfer book, the particulars (of names of accounts, account
numbers and amounts) from the relative vouchers should be checked. The authorizing
officer should run through the vouchers and compare that:

(a) in respect of each credit voucher: the title of the account, account number and the
amount
(b) In respect of every cheque: the amount
(c) In respect of debit vouchers other than cheques: the name, account number and the
amount are correct.
114.1 After the calling is over, the officer should go through the vouchers to ensure that:

(a) Each voucher bears the transaction number entered by the posting clerk under his
initials (to indicate that it has been posted in the ledger)
(b) Each voucher bears "Cash", "Clearing" or "Transfer" stamp (with date) as the case
may be
(c) Vouchers are passed by the authorised officers and all credit and debit vouchers
over Rs. 5,000/- bear the full signatures of officers
(d) Each cash payment cheque or other instrument involving payment of cash of Rs.
500/- and over bears the full signature of the cancelling officer (and not merely his
initials)

The signing powers of Special Assistants (as per work class) and officers revise from
time to time.

114.2 Regarding second cancellation / authorization, the following requirements are to

be followed:-

a) Where the first cancellation is by a special assistant, the second cancellation

invariably should be done by an officer.

b) Where the first cancellation is by an officer the second cancellation will be

done by another officer.

The official passing payment of cheques should pass (cancel) the drawer’s signature
104
on the instrument in such a manner that it is not obliterated / defaced,

SIGNING OF CLEARING AND TRANSFER VOUCHER

115.1 The instructions regarding signing of clearing & transfer vouchers is still hold
good.

Amount in Rs. Signatory signing under

Section I- Officers Section II – SWO A/ B/ Head
Cashier/ Special Assistant
Up to and inclusive of May be signed singly May be signed singly
Rs.15,000/-
For amounts above May be signed singly May be signed singly except
Rs.15,000/- & up to SWO A Work Class 110
Rs.25,000/-
For amounts above May be signed singly May be signed singly except
Rs.25,000/- & up to SWO A - Work Class 110
Rs.50,000/- SWO B – Work Class 130
For amounts above May be signed singly Must be signed jointly
Rs.50,000/- & up to
Rs.1,00,000/-
For amount above Must be signed jointly Must be signed jointly
Rs. 1,00,000/-

i) Where first signatory is of Section II the second signatory must be of Section I.

ii) Where first signatory is of Section I the second signatory must be of Section I
except in case of Single Officer Branches.

iii) Above instructions are not applicable to P & L Suspense Debit, Sundry Credits,
Sundry Deposits and Dormant Account etc. Vouchers which should invariably be
checked and signed by two officials.

The signing powers for Demand Drafts / Pay Orders / Mail Transfers / Telegraphic
Transfers / Term Deposit Receipts as under-

Category Signing Power

(A) Singly
i) Section II- Special Assistants/ Cashier Instruments up to Rs.25,000/- or
in – charge equivalent in Foreign Currency
Section I – Officers Instruments up to Rs.50,000/- or
equivalent in Foreign Currency
(B) Jointly
ii) Jointly where one of the signatory Instruments above Rs.50,000/- or
should be from Section I equivalent in Foreign Currency

105
115.2. When authenticating the postings, the checking officer should ensure that:

(a) the vouchers are posted in the right accounts and the amounts are correctly
entered in the correct column, debit or credit, as the case may be

(b) The serial numbers of the cheque(s) drawn on the account are from the cheque
book issued to the account holder

(c) No cheque has been accepted in a savings bank account unless the account is
introduced to the satisfaction of the Bank or has been otherwise approved

(d) No stopped cheques have been inadvertently paid

(e) Restrictions placed on the operations of an account under orders of any

Court/Income Tax Authorities are adhered to. If any mistake is noticed, it should be
corrected on the spot in all the relevant books under the initials of the officer.
Balancing through the computer system

116. Periodical Balancing should be done under each category of deposits

accounts/head through the computer system and it should be tallied with General
Ledger Balance (GLB) and Form A and any other book as prescribed by our Bank from
time to time.

Periodical Balancing of Accounts

117. Periodical Balancing should be done under each category of deposits

accounts/head through the computer system and it should be tallied with General
Ledger Balance (GLB) and Form A and any other book as prescribed by our Bank from
time to time.

V. Death, Insolvency and Insanity of Account Holder

Branches should follow our latest Deceased Policy for delegation of powers and any
other changes/modifications/new guidelines from time to time.

Death of Account Holder

118.1. Upon the death of an account holder the authority given by him to his banker to
pay cheques either drawn by him or his agent stands revoked. Mandate letters and
powers of attorney are made void by the death of the person who has given them. The
Bank may or may not have received a formal notice of the account holder's death; it is
sufficient notice if there is an announcement of the account holder's death in
newspaper. Branches should not, however, act upon a mere rumor of an account
holder's death - facts should be ascertained. All cheques signed by the account holder
and presented for payment after notice of his death must be returned with the remark
106
"Drawer deceased"; all cheques signed on behalf of the account holder(s) by the power
of attorney holder(s) or the mandate holder(s) and presented for payment after the
receipt of the notice of the account holder's death should be returned with the remark
"Drawer (on whose behalf cheque is drawn -state his name) deceased".

118.2 In the case of current account of a partnership firm or joint account of two or more
persons, when one of the partners or joint account holders in an account which is
temporarily overdrawn is deceased, the Branches should endeavor to set right the
account before future withdrawals/debits are made in the account.

Repayment of Balance of a Deceased Account Holder

Branch should follow our latest Deceased Policy for delegation of powers and any other
changes/modifications/new guidelines from time to time.

119.1 In accounts of deceased where nominations has not been made:

i) Application form for payment of balance in the deceased account holder
will be obtained on the prescribed format Appendix XXIII duly signed by all heirs of the
deceased.
ii) The application form will accompany death certificate from the appropriate
authority.
iii) Facts given in the application form will be verified and branch will get
satisfied about it.
iv) Branch will obtain indemnity (specimen – As per Manual of Instructions
Appendix XXVIII) with sureties of appropriate worth duly executed by all heirs and
sureties wherever applicable.
v) Branch will not insist for succession certificate from heirs for payment
where the amount involved is upto Rs. 40.00 lakh. However, in case of dispute among
the heirs, succession certificate will be insisted upon.
vi) Whenever deceased has left Will, Probate from the competent court will
be insisted upon.
vii) Branch will obtain sanction for payment of balance from the appropriate
authority as per the delegation of powers.

119.2 When the heirs of a deceased account holder request the Bank to pay the
balance in the account of the deceased, without obtaining legal representation, against
an indemnity letter:

(a) Branches should require the claimants to furnish particulars on a prescribed form
(Specimen - Appendix XXIII). The Branch should verify the particulars given in the form.
(He should initial at the foot of the form to signify that he has verified the details). Care
should be exercised where the reported age of one of the heirs of the deceased is 18
years; it should definitely be stated whether such heir has completed 18 years or not.

(b) If, on the basis of the information obtained, and depending upon the relevant
circumstances, it is decided to repay the balance to the claimants against an
107
 Indemnity Letter, the following procedure should be followed depending upon the
amount involved.

Claim amount in deceased depositor Details on requirement of Indemnity, Affidavit

account(s) &Sureties and net-worth of Sureties
*Balances up to and inclusive of Rs. a. Declaration from respectable person/s well
5,000/- including up to date interest known to deceased family in para no.5 of
claim form
b. Declaration / undertaking from claimants (
Annexure-10)
c. Unstamped Letter of Indemnity signed by all
the heirs
Above Rs. 5,000 and up to & inclusive a. Declaration from respectable person/s well
of Rs. 25,000 including up to date known to deceased family in para no.5 of
interest claim form
b. Declaration / undertaking from claimants (
Annexure-10)
c. Affidavit (Duly Stamped & Notarised) (
Annexure-4)
d. Stamped Letter of Indemnity signed by all
the heirs
e. One surety or more sureties jointly of good
standing for the amount involved.
Above Rs. 25,000 and up to & a. Stamped Letter of Indemnity signed by all
inclusive of Rs. 5 Lakh including up to the heirs
date interest b. One surety or more sureties jointly of good
standing for twice the amount involved.
Above Rs.5 Lakh and up to & a. Stamped Letter of Indemnity signed by all
inclusive of Rs. 40 Lakh including up the heirs.
to date interest b. One surety or more sureties jointly of good
standing for thrice the amount involved.

• Wherever the claimants are finding it difficult / not able to obtain legal heir certificate:
Branch may settle the claim without insisting for Legal heir certificate up to Rs. 5,000/-
on basis of Declaration / Undertaking from claimants (Annexure-10) & Declaration from
respectable person/s well known to deceased family in para no.5 of claim form and
claim above Rs. 5,000 and up to & inclusive of Rs. 25,000 /- including up to date interest
with an additional documents i.e. Affidavit (Duly Stamped & Notarised), subject to
condition that the sanctioning authority is fully satisfied about the identity , integrity and
bonafides of the claimants after due enquiry.

With a view to reducing the stamp duty on claimants, Branches should obtain Indemnity
Letter which will be stamped as an Agreement and NOT as a Bond. Such Indemnity
Letter will not be attested i.e. it is not to be witnessed. The intention is that neither the
signature of the executant of Indemnity nor the signatures of the sureties will be
witnessed. This, however, does not dispense with the necessity of due identification of
the sureties and of the executant of the Indemnity. Manager should independently
108
assess the worth of the sureties and satisfy himself that the sureties are acceptable. If
necessary, he may obtain status reports on the sureties from their bankers.

(c) Stamped indemnity letter duly signed by the claimants and the sureties should be
preserved in a separate file with the relative correspondence and papers - in no case
should be indemnity letter be filed away with the relative vouchers.

(d) The claimants should be asked to return all unused cheque forms. The pass book
should also be called for and written up to date and returned.

119.3 Where the deceased account holder has not made a Will, all the heirs of the
deceased should execute the indemnity letter, although the request may be to pay to
one or few of the heirs.

119.4 Where the deceased account holder has made a Will but the executors of the
Will do not intend to obtain the Probate and request the bank to pay the balance against
an indemnity letter, the person who would be the heirs of the deceased, had he died
without leaving a Will (i.e. heirs as on intestacy) should join the indemnity in addition to
the executors.

Death of Individual Account Holder

120.1 If an account is in the name of an individual or proprietorship concern, upon the

death of the individual/sole proprietor, the bank balances in his/its various deposit
accounts become payable to the legal representative of the deceased upon production
of a proper legal representation, such as a Probate, Letters of Administration,
Succession Certificate or Administrator General's Certificate.

120.2 The "legal representative" of a deceased can be anyone of the following:

(a) The executor(s) who has obtained a grant of Probate of the Will of the deceased

(b) The administrator(s) who has obtained a grant of Letters of Administration to the
estate of the deceased

(c) The holder of a Succession Certificate

(d) The holder of an Administrator General's Certificate

120.3 Probate is granted by Court in respect of the last Will and Testament of the
deceased. Letters of Administration are issued by Court in respect of movable or
immovable property and without any limit as to the value thereof. A Succession
Certificate can only be issued for debts, shares or securities and not for any other
property movable or immovable (jewellery or ornaments kept in a safe deposit locker).
An Administrator General's Certificate can be issued only for estates not exceeding Rs.
50,000/- in the aggregate.

109
120.4 When Probate of a Will or Letters of Administration or other legal representation
issued by a competent Court in India is produced, Branches should examine it to satisfy
that:
(a) It unquestionably relates to the account of the deceased and

(b) Particulars of the amount due by the Bank to the deceased are correctly shown in
the schedule of property attached to the grant on the strength of which payment is
desired to be made by the Bank to the holder(s).
120.5 The identity of holder of such a grant should be proved to the satisfaction of the
Bank before payment is made. (Usually, the original grant or a copy thereof, certified
by the Court, should be produced for registration. If such original or certified copy is not
produced, but only a plain copy is produced, registration thereof should be declined and
a request made for the original or a copy certified by the Court).
120.6 The particulars of the Probate or Letters of Administration or other legal
representation produced should be registered in Power of Attorney Register (Form OD
127 A). The register should contain such particulars such as:
(a) Date of the Will
(b) Date of the Probate or Letters of Administration
(c) Name of the Court or other authority which issued the grant
(d) Date when exhibited and by whom
(e) Names of the executors or administrators
(f) Gross value of the estate
(g) Balances or facilities at the Bank
The particulars entered in the register should be checked and initialed by the Manager.
The date and serial number in the register in which the record is maintained should be
noted on the account opening form/card under the initials of an officer of the concerned
department or by the Deputy Manager/Deputy Chief Manager of the Branch or by the
Manager in a small Branch. (The production of legal representation does not by itself
dispense with the need of proof of death; as far as practicable, death certificates should
be insisted upon, before making payment).
120.7 A grant of legal representation issued by any Court outside India should not be
registered. A proper grant from a competent Court in India should be requested. A Will
of which Probate has not been obtained should not be acted upon and no payment
should be made on the strength of the Will only, to the executor(s) until a Probate has
been obtained.
120.8 In the case of Probate or Letters of Administration, one of the several executors
or administrators can give a valid discharge, in the absence of any directions to the
contrary in the Will or the grant. Even so, where a grant is made in favor of more persons
than one, a joint receipt or discharge from all such persons should be insisted upon.
This rule should be adhered to when payment of balance of account of a deceased is
made.
110
120.9 Where a grant of Probate is made reserving the right of another executor(s) to
come in and prove the Will later on, only those who have proved the Will and obtained
Probate are entitled to receive payment of the balance due to the deceased and give a
valid discharge.
120.10 In the event of death of one of the several executors or administrators who have
obtained Probate or Letters of Administration, the survivor(s) is entitled to carry on the
administration of the estate and to give a valid discharge for payment.

Death of one of the Joint Account Holders

(a) Current/Savings Bank Accounts

121.1 Upon receipt of notice of death of one of the account holders in an account to be
operated upon by "Either or Survivor", "Former or Survivor" or "Anyone or anyone of
the survivors or the last survivor" etc., it is not necessary to close the existing account
and open a new one. The name of the deceased account holder may be deleted after
registering his death certificate in the Bank's books and account allowed to be operated
upon by the surviving account holder(s) provided the joint account is an ordinary current
account (having no borrowing facility) or a savings bank account. It is, of course, open
to the surviving account holder(s) to withdraw the entire balance and thereby close the
account.

121.2 Branches should observe the following procedure upon receipt of notice of death
of a joint account holder:

(a) Date of receipt of notice of death and source of information should be noted in the
system

(b) Cheques drawn by the deceased joint account holder either singly or jointly as per
operational instructions and presented after the notice of death should be returned
unpaid with the remark "Drawer deceased" or "One of the drawers, Mr./Mrs./Miss
................................................. deceased".

(c) Survivor should be asked to produce death certificate from proper authorities as
proof of death of the joint account holder. When the death certificate is received, the
name of the deceased joint account holder should be deleted in red ink/ball-point pen
from the account opening form/card and ledger account under the initials of an officer
(stating the date of death). Usual practice of registering the death certificate should be
followed.

(d) If there are no instructions in the joint account to pay the balance to the "survivor"
or "the survivors or any one (or two or more, as the case may be) of the survivors or the
last survivor", the operation on the joint account should be stopped on receipt of notice
of death of a joint account holder and every withdrawal should be allowed only against
the joint discharge of the survivor(s) and the legal representative(s) of the deceased
joint account holder.
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122. It may happen that the legal representatives or the heirs of a deceased joint
account holder may serve upon the Bank a notice disputing the right of the survivor(s)
to the balance in the account. The proper procedure in such a case would be to explain
to the claimants the correct position that the Bank cannot take cognizance of any such
notice and that in accordance with the instructions in the account, which forms a term
of the contract between the Bank and the depositors, the Bank is bound and liable to
honor the cheques signed by the survivor(s) unless an order of a competent Court
prohibiting the Bank from honoring his cheques is served on the Bank before the time
such cheque(s) is/are presented. Until and unless such a Court order is served upon
the Bank, the Bank should honor the cheques of the survivor(s), even if they result in
payment of the full balance in the account.

b) Term Deposit Accounts

123.1 Instructions given by the joint account holders at the time of opening the account
constitute the terms of contract between the depositors and the Bank; and, any variation
in such terms can be made only with the consent of all the parties/surviving parties to
the account. In the case of a Term Deposit, the period for which the deposit is accepted
is also one of the terms of such contract.

123.2 If the deposit runs up to the date of maturity, payment will be made to the surviving
account holder(s).

123.3 Upon receipt of notice of death, Branch should make a note of the fact of death
in the books of the Bank for further reference.

123.4 According to RBI directives, in case of Term Deposit Accounts where the account
holder is deceased, the claim of the legal heir/representative should be settled first, by
allowing simple interest at the appropriate rate, for the period from the date of maturity
till the date of settlement, without treating the deposit as having been renewed. The
proceeds thus arrived at on the date of settlement can, however, be placed as fresh
deposit, under any scheme/plan of deposit by the legal heir-turned-depositor.

123.5 Branches should give the following details (or such of them as may be available)
while recommending for consideration premature repayment to the surviving
depositor(s):

(i) Amount of the deposit receipt

(ii) Its due date

(iii) Name(s) of the depositor(s)

(iv) Name(s) of the deceased depositor(s)

(v) Name(s) of the heir(s) of the deceased depositor(s)

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(vi) Name(s) of the legal representative(s) (if any) of the deceased

(vii) Whether the heir(s)/legal representative(s) would be willing to give his/her consent
to the payment before maturity or is likely to object

(viii) Other facts of the case relevant to the issue

123.6 Payment of interest in case of term deposit accounts of deceased depositor(s):

In case of a Term Deposit standing in the name/s of:

(1) A deceased individual depositor, or
(2) Two or more joint depositors, where one or all the depositors have expired, interest
shall be paid in the manner indicated below,
(i) On the maturity of the deposit:
Bank will pay interest at the contracted rate till the date of maturity of deposit.
(ii) In case of premature withdrawal by legal heir(s)/nominee/legal heir, i.e., in
the event of the payment of deposit being claimed before the maturity date/
contract period:

The bank will pay “applicable rate of interest on the date of acceptance of deposit for
the actual period for which deposit has remained with the bank or contracted rate of
interest, whichever is lower shall be applicable” without charging penalty.
(iii) In case of deposit being claimed after the date of maturity
In the case of death of depositor(s) after the date of maturity of the overdue deposit, the
Bank shall pay interest at Saving Bank Rate applicable as on the date of maturity, up
to the date of payment.
In the event of death of the depositor, before the date of maturity of deposit and where
the amount of the deposit is claimed after the death of maturity, the Bank shall pay
interest at the contracted rate, till the date of maturity and thereafter at simple term
deposit interest applicable as on the date of maturity, for the period for which the deposit
remained with the Bank, beyond the date of maturity.
In the event of auto renewal system of term deposits for the same tenor (as of the
maturing deposit) at the then prevailing rate of interest applicable as on date of maturity,
Bank shall pay interest at the contracted rate/ prevailing rate up to the date of maturity
span of such auto- renewal period, during which depositor has expired and thereafter
simple term deposit interest at the applicable rate for the period (as on the date of
renewal/ maturity), up to the date of payment.

Optional Instructions

124.1 Branches sometimes receive requests for an advance against Term Deposit
Receipts or for repayment of the Term Deposit before maturity. In case one of the joint
account holders is deceased, such requests cannot be acceded to outright, as this
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would be tantamount to a change in the terms of the contract, for which the concurrence
of the legal representatives of the deceased would be required, and, where legal
representation has not been obtained, various formalities, including execution of
Stamped Indemnity, would have to be completed.

124.2 With a view to obviating inconvenience to customers in such cases, when

opening Term Deposit Accounts or renewing existing accounts, Branches should give
to the customers the option of adding the following clause by way of additional
instructions. In case of EXISTING Term Deposit Accounts prior to renewal there is no
objection if the account holders wish to add these instructions provided all the joint
account holders are alive:

"In the event of death of any of the joint depositors prior to maturity of the deposit the
Bank will, at the request of the surviving depositor/of all surviving depositors, be at
liberty though not bound and at its absolute discretion to add/delete any name or to
repay the deposit before maturity or to grant an advance against the security thereof,
on such terms as the Bank may in its absolute discretion decide and such repayment
before maturity shall constitute a valid discharge to the Bank".

124.3 Branches should, however, note that acceptance of these instructions is entirely
at the option of the customer - It is not compulsory. Acceptance or cancellation of this
clause should be under the signatures of all the account holders.

124.4 Branches should prepare a rubber stamp reading "Optional Instructions

Accepted/Cancelled" and put it on the Deposit Receipt, to indicate whether the
aforesaid instructions have been accepted or cancelled.

124.5 The cancellation of the clause should also be under the signatures of all the
account holders in order to forestall any disclaimer, by the account holders at a future
date that they were not aware that such additional instructions could be given.

124.6 The effect of the clause is that the depositor on his demise gives up his right to
the deposit. Consequently Branches can allow the survivor(s) either to add/delete a
name or get repayment before maturity or an advance against the Term Deposit without
the usual formalities of obtaining the consent of the legal representatives, executing an
indemnity etc.

Death of a Partner in Accounts of Firms

125. Subject to a contract to the contrary, the death of a partner dissolves the firm
(Section 42(c) of the Indian Partnership Act, 1932). Under Section 47 of the Act the
surviving partners can, notwithstanding the dissolution, continue the business of the
firm for the purpose of winding up or completing unfinished transactions. The authority
of the surviving partners for continuing the firm's business after its dissolution by the
death of a partner is valid only for purposes of winding up of the firm and it is not always
practicable to determine easily whether the transactions in an account are for the
winding up of the firm or not. Branches should observe the following procedure on the
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notice of death of a partner:

(a) The date of receipt of notice of death and source of information should be noted in
the ledger account under authentication.

(b) Cheques signed by the deceased partner and presented after notice of death may
be paid upon confirmation by the surviving partners.

(c) The death certificate from appropriate authorities should be furnished to the Bank
as a proof of death of the partner. On receipt of the death certificate, a remark in red
ink/ball-point pen stating the date of death should be made in the account opening
form/card under initials of an officer against the name of the deceased partner.

(d) Pending the opening of a new account for the reconstituted firm, surviving partners
may be allowed to operate the existing account of the firm, provided it is an ordinary
deposit account with no borrowing facility.

(e) A cheque or a letter of authority signed by the surviving partner(s) in accordance

with the signing instructions in the account should be obtained to transfer the balance
from the existing account of the reconstituted firm.

(f) If there are outstanding cheques drawn on the old account, written authority should
be taken to debit them to the new account.

Death of ‘Karta’ of Joint Hindu Family Account

126. On the death of the "Karta", Branches should stop operations in the account. The
death certificate should be obtained and registered. A new set of account opening
forms/cards and a new Joint Hindu Family Letter completed by the new "Karta", under
the written consent of all the major co-parceners of the old account, should be obtained
and a new account of the Joint Hindu Family opened. The credit balance in the old
account should thereafter be transferred to the new account. (Obtaining affidavit cum
indemnity (Specimen Appendix XXXIII) from surviving members and legal heirs with
two surities confirming their acceptance to one of the members as a new Karta)

Death of a Trustee in Trust Account

127. In case of death of a trustee, it is not safe for the Bank to assume that the surviving
or the continuing trustees possess full powers to deal with the trust property. The
surviving trustee(s) has power to act, only if there is nothing to the contrary in the trust
deed. Hence, Branches should peruse the trust deed and act accordingly.

Procedures for settlement of claims in respect of deceased depositors

Keeping in view the same scope and objective, Bank has merged its Policy on Model
Operational Procedure for Settlement of Claims in Deceased Depositors Accounts and
Model Policy on Settlement of Claims Received from Nominee / legal Heirs of Missing
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 Persons maintaining Deposit Accounts and renamed the policy as "Bank's Policy on
Operational Procedure for Settlement of Claims of Deceased / Missing Depositors
Accounts".

127. A. The modified forms as per the Model Operational Procedure adopted by our
Bank to enable the branches to settle the claims are as under:-

i. Application form for payment of balance in the account of deceased depositor when
account has nomination or is a joint account with survivorship clause (Appendix
XXVII)

ii. Application form for claim for payment of balance in the account of deceased account
holder where no nomination has been made or is a joint account without a survivorship
clause (Appendix XXVIII).

iii. Indemnity letter regarding payment of balance in the account of deceased account
holder without production of Legal Representation(Appendix XXXI)

iv.Receipt for full and final settlement of claim (Appendix XXXVII)

v.Declaration in case funds are settled in favour of a minor (Appendix XXXVIII)

vi.Check list of documents (Appendix XXV)

Branches should obtain the indemnity letter duly executed by all the legal heirs and the
sureties of appropriate worth along with receipt for full and final settlement of claims. In
case the funds i.e. the balance in the deceased depositor’s account are settled in favor
of minor, the declaration for utilization of the claim amount for benefit of the minor is to
be obtained from the natural guardian. Branches to obtain documents as per the check-
list only while settling the claims pertaining to deceased depositors. There is no change
in delegated powers for settlement of claims in deceased depositors’ accounts. All
papers related to settlement of claims should be preserved carefully.

Time limit for settlement of claims

The branches will settle the claims in respect of deceased depositors and release
payments to survivors(s)/nominee(s) within a period not exceeding 15 days from the
date of receipt of the claim subject to the production of the proof of death of the depositor
and suitable identification of the claimant(s) to the bank’s satisfaction. In the case of
accounts without survivorship / nomination clause, the claim should be settled within
one month from the date on which the requisite documents have been submitted.
Branches should strictly adhere to the time norms fixed by the Bank for expeditious
settlement of claims.

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Treatment of flows in the names of deceased depositors
Further, in order to avoid hardship to the survivors/nominee(s) of a deposit account, it
has been decided to obtain appropriate agreement/authorization (as per the format
enclosed) from the survivor(s) / nominee(s) with regard to the treatment of pipeline flows
in the name of the deceased account holder and the following procedure will be adopted
for pipeline credits:

“ As authorized by the survivors/nominee(s) of deceased account holder, the branch

will open an account styled as “Estate of Shri/Smt. _______________” (the deceased),
where all the pipeline flows in the name of the deceased account holders will be allowed
to be credited and no withdrawals are to be allowed. The balance in such account will
be settled with nominee(s)/survivors after completion of such transaction period as
agreed in authority letter.

Customer Guidance and Publicity on the benefits of nomination facility and the
survivorship clause for expeditious and hassle free settlement of claims upon
the death of depositors

Further, branches should also bring to the notice of the deposit account holders that:

“Nomination facility does not take away the rights of legal heirs on the estate of the
deceased. The nominee would be receiving the stock (balance in deposit account) from
the bank as a “trustee” of the legal heirs”

Accordingly, the above clause is being incorporated in Account Opening Form. The
other conditions/precautions to be observed in this connection remain unchanged.

Insolvency or Winding up

Accounts of Individuals and Limited Companies

128. Insolvency of an individual customer and winding up of a corporate body customer

terminates the authority of the banker to pay cheques or to accept or honor bills or to
take any other action or deal with the property on behalf of such a customer. The
cheques drawn by the insolvent or his agent dated prior to the date of his being
adjudicated as insolvent, should not be paid. After the order of adjudication is made,
property of the insolvent vests in the Official Assignee/Receiver/Liquidator.

Joint Accounts

129. The insolvency of a joint account holder terminates the joint relationship and further
operations on the account must be transacted by the Official Assignee or Official
Receiver and the solvent parties. Cheques drawn by the insolvent account holder must
be returned unpaid. Cheques drawn by the solvent account holder(s) alone irrespective
of the operational instructions also should be returned if they are not countersigned by
the Official Assignee/Official Receiver. Care must be taken not to damage the credit of
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the solvent parties. The remark on the returned cheques should be "Joint account
holder `A' in insolvency" or in similar terms.

Partnership Firm Accounts

130.1 Subject to a contract between the partners, a firm is dissolved on the insolvency
of a partner of the firm (Section 42 of The Indian Partnership Act, 1932). The credit
balance in the account of the firm, a partner of which has become insolvent, can safely
be paid to the solvent partner. If the firm is indebted to the Bank and it is desired to
retain the Bank's rights on the insolvent's estate, it is necessary to break (not close) the
firm's account. Cheques drawn by the insolvent partner should be paid upon
confirmation of the solvent partners.

130.2 A firm is dissolved by the adjudication of all the partners or all the partners but
one as insolvent (Section 41 of the Indian Partnership Act, 1932). In such a case, all
operations on the firm's accounts and also on the private accounts of the partners
should be stopped, whether the accounts are in debit or in credit.

Insanity or Lunacy of Account Holders

131. Under Section 11 of the Indian Contract Act, 1872 persons of unsound mind are
disqualified from contracting, but the disqualification does not apply to contracts entered
into or ratified by lunatics during the periods of their sanity.

Accounts of Individuals

132. When the Bank comes to know of its customer's lunacy, all operations on his
account, irrespective of whether the account is operated upon by customer himself or
by his agent, should be suspended until receipt of an order from the Court, or definite
proof of customer's sanity has come into the hands of the Bank. When lunacy order is
received, a careful note should be taken on the Bank's record and the account may be
allowed to be conducted in accordance with the instruction, if any, contained in the
Order.
Joint Accounts

133. The insanity of a party to a joint account has the effect of stopping the account and
the balance must be held to the joint order of the other account holder(s) and the
receiver in lunacy.

Partnership Firm Accounts

134. In the event of a partner of a firm becoming insane, the proper course would be to
advise the other partners to apply to the Court for an interim injunction restraining the
insane partner from meddling with the affairs of the firm, or to instruct the Bank to allow
operations on the account only on joint signatures of all the remaining partners (i.e.
other than the insane partner).

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Settlement of Claims received from the Nominee / Legal Heirs of missing persons
maintaining deposit account with the Bank

Branch should follow our latest Deceased Policy for delegation of powers and any other
changes/modifications/new guidelines from time to time.

134.1 At present, claims received from the Nominee/Legal Heirs of a missing person
maintaining deposit account with the Bank are settled as per the Order of a Competent
Court.

134.2 The settlement of claims in respect of missing persons is governed by the

provisions of Section 107/108 of the Indian Evidence Act, 1872. Section 107 deals with
presumption of continuance and Section 108 deals with presumption of death of a
missing person. As per the provision of Section 108 of the Indian Evidence Act,
presumption of death can be raised only after a lapse of seven years from the date of
a person being reported missing. The Nominee/Legal Heirs of the missing person have
to raise an express presumption of the depositor/subscriber under Section 107/ 108 of
the Indian Evidence Act, before a Competent Court. If the court presumes that the
missing person is dead, it issues an order for settlement of the claim in respect of the
missing person/depositor and accordingly the claim is settled by the Bank.

134.3 With a view to avoid inconvenience and undue hardship to common public in
obtaining a court order, it has been decided to fix the threshold limit of Rs. 40.00
Lac for settlement of claims in deposit accounts without insisting upon a court
order. Indemnity Documents to be obtained in such deposit accounts are as under:

Claim amount in deceased depositor Details on requirement of Indemnity,

account(s) Affidavit &Sureties and net-worth of Sureties
*Balances up to and inclusive of Rs. a. Declaration from respectable person/s
5,000/- including up to date interest well known to deceased family in para no.5
of claim form
b. Declaration / undertaking from claimants (
Annexure-10)
c. Unstamped Letter of Indemnity signed by
all the heirs
Above Rs. 5,000 and up to & inclusive a. Declaration from respectable person/s
of Rs. 25,000 including up to date well known to deceased family in para no.5
interest of claim form
b. Declaration / undertaking from claimants (
Annexure-10)
c. Affidavit (Duly Stamped & Notarised) (
Annexure-4)
d. Stamped Letter of Indemnity signed by all
the heirs
e. One surety or more sureties jointly of good
standing for the amount involved.
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 Above Rs. 25,000 and up to & a. Stamped Letter of Indemnity signed by all
inclusive of Rs. 5 Lakh including up to the heirs
date interest b. One surety or more sureties jointly of good
standing for twice the amount involved.
Above Rs.5 Lakh and up to & a. Stamped Letter of Indemnity signed by all
inclusive of Rs. 40 Lakh including up the heirs.
to date interest b. One surety or more sureties jointly of good
standing for thrice the amount involved.

• Wherever the claimants are finding it difficult / not able to obtain legal heir certificate:
Branch may settle the claim without insisting for Legal heir certificate up to Rs. 5,000/-
on basis of Declaration / Undertaking from claimants (Annexure-10) & Declaration from
respectable person/s well known to deceased family in para no.5 of claim form and
claim above Rs. 5,000 and up to & inclusive of Rs. 25,000 /- including up to date interest
with an additional documents i.e. Affidavit (Duly Stamped & Notarised), subject to
condition that the sanctioning authority is fully satisfied about the identity , integrity and
bonafides of the claimants after due enquiry.

134.4 The documents to be obtained from the Nominee/Legal Heirs/Claimants, along

with Application Form for settlement of dues in respect of missing persons are as under:
i. Copy of FIR lodged with Police authority.

ii. Certificate issued by Police authorities that such missing person is not traceable.
iii. The report of non-traceability of missing person by the Police should be of a date
after 7 years from the date of registration of FIR and enquiry by the Police authority.
iv. Declaration by the Nominee /Legal Heirs of the missing person (depositor) that the
missing person has not been heard of for the last seven years and also their
indemnity as given above.

v. Confirmation about legal heirs (in case of settlement of claim with the legal heirs).

vii. Checklist of Documents(Appendix XXVI)

134.5 For an amount of deposits exceeding Rs. 40 Lakh, the Nominee/Legal Heirs of a
missing person maintaining a deposit account, should apply to a Competent Court
under Section 107/108 of the Indian Evidence Act and if the Court is convinced and
satisfied, it can presume that depositor/missing person is dead and then the request of
the claimants can be considered by the Bank on the basis of the Court Order; as per
the existing procedure in vogue.

134.6 However, in case of any dispute arising amongst the Legal Heirs or Nominee and
any other person claiming the balance amount in the account of missing person, the
Bank should insist upon claimants to produce an Order from a Competent Court
irrespective of the balance in the account, even if the balance is Rs.40 Lakh and below.

134.7 Copies of the following Forms to be obtained from Nominee / Legal heirs are
enclosed for ready reference:
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i. Application form for payment of balance in the account of missing person/depositor
when account has nomination or is a joint account with survivorship clause (Appendix
XXVII)

ii. Application form for claim for payment of balance in the account of missing
person/account holder where no nomination has been made or is a joint account
without a survivorship clause (Appendix XXVIII)

iii. Indemnity letter regarding payment of balance in the account of a missing

person/account holder without production of Legal Representation (Appendix XXXII)

iv. Receipt for full and final settlement of claim (Appendix XXXVII)

v. Declaration in case funds are settled in favour of a minor (Appendix XXXVIII)

vi. Check-list of Documents (Appendix XXVI)

vii. Settlement of claims in various types of accounts / Facilities (Appendix XXIV)

134.8 Branches will obtain the above new Forms with immediate effect and documents
as listed above for settlement of dues of missing persons. The branches should obtain
an Indemnity Letter duly executed by all the Legal Heirs and the Sureties of appropriate
worth, along with a Receipt for full & final settlement of the claim. However in case of
settlement with the nominee, there is no need to obtain indemnity letter. Further, if the
dues (balance in the missing person/depositor’s account) are settled in favour of a
minor, a Declaration for utilization of the claim amount for the exclusive benefit of the
minor should be obtained from the natural guardian. Branches should obtain documents
as per the check list only while settling claims pertaining to a missing person maintaining
a deposit account. We would like to advise / clarify that the Delegated Powers for
settlement of claims in respect of a deceased depositor would be also applicable in
cases of a missing account holder. Please also note importantly that all papers
pertaining to settlement of claims in respect of a missing account holder should be
preserved carefully.

134.9 Further, branches should note to ensure that all claims received by them in
respect of missing persons are settled and payment thereof be released to the Nominee
/ Legal Heirs within one month from the date of submission of requisite documents.
Branches should strictly adhere to the norms fixed by the Bank in this regard, for
expeditious settlement of claims in respect of a missing account holder.

VI. MISCELLANEOUS INSTRUCTIONS

Filing and Custody of Account Opening Forms (Appendix I)/Cards

135. Normally each account opened at a Branch is given a serial number department
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wise and the specimen signature cards should be arranged in the filing cabinets in their
respective serial order. But, depending on the volume of business at a Branch and
operational convenience, Branches may adopt different methods of filing of these cards.
It is, however, desirable to arrange these cards in a serial order where the accounts are
opened in the ledgers in the serial orders of the number of accounts, i.e., savings bank,
etc. Where the accounts are opened in alphabetical order (i.e. current accounts), it is
obviously convenient to arrange the cards in alphabetical order. The account number
should be noted on the specimen signature cards before they are filed. The cards must
be maintained in good condition. RBI has directed banks to treat “Transgender Persons”
as third gender and include as “third gender” in all forms\applications etc., wherein any
gender classification is envisaged.

136. The signatures should be scanned immediately (along with photographs) and
the same should be authenticated.
137. When an account is closed, a rubber stamp "Account Closed" should be affixed
on the specimen signature card under the date and initials of an officer in such a manner
as not to obliterate the specimen signature(s). The signatures of closed accounts should
be immediately deleted from the system.

Filing of Current Account Opening Forms

138. Branches should take proper care in filing of current account opening forms.

Custody of Current Account Opening Forms

139. As the current account files contain account opening forms bearing specimen
signatures etc., of account holders, it is absolutely necessary that these files, at all
times, remain in the custody of an officer of the Branch. It is of paramount importance
that no unauthorized person should be allowed to have an access to these files. The
files, when they are not in use, must be kept locked in a steel cabinet. The concerned
officer at the Branch should once in a year, verify that the account opening cards of all
operative accounts (live accounts) are available and that they are properly arranged.

Custody of Other Deposit Account opening Forms/Cards

140. The care and precautions indicated in the above paragraph 139 apply equally to
the custody of account opening forms/cards of other deposit accounts.

Paying-in-slips

Branches should follow latest guidelines and any other changes\modifications\new

guidelines from time to time, regarding standardization of various forms used in Banks
viz. (1) Deposit/pay-in-slips (2) Cash withdrawal slip (3) cheque book request form (4)
cheque return slip (5) Pass book (6) Fund transfer form –NEFT/RTGS (7) Stop payment
request form (8) DD\Pay order application form (9) Fixed\Recurring deposit application
form (10) Service request form. These standardized forms will be used by all the Banks
w.e.f. 01.01.2017.
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RBI has directed banks to treat “Transgender Persons” as third gender and include as
“third gender” in all forms/applications etc., wherein any gender classification is
envisaged.

141.1 Paying-in-slips are provided by the Bank for deposit of money for credit of deposit
accounts. Care should be taken to see that the paying-in-slips bear the name of the
Branch. Normally, the name of the Branch will be printed thereon, but, if it is not so
printed, Branch rubber stamp should be affixed thereon. All particulars on the slip
should be properly and carefully filled in by the depositor who should sign at the place
"By.......". In the case of paying-in-slips for Term Deposits, other particulars such as
term of deposit, rate of interest, etc., should also be filled in by the depositor.

141.2 The customer should be advised to preserve the counterfoil of the paying-in-slip
carefully to be able to exchange it with the deposit pass book/deposit receipt/certificate
etc. in due course. On the paying-in-slip, the number of account, where applicable,
should be written legibly. Where, in a savings bank account, moneys are accepted
without pass book accompanying paying-in-slip, the paying-in-slip and counterfoil
should be rubber stamped "without Pass Book" by the cashier receiving such deposits.

The cashier should give computerized cash receipt acknowledgement through the
“printer” besides the counterfoil of the paying-in-slip.

Receipt/Payment Scroll Book

142. Now system provide the cash Report on all receipts and payments done.
(Also refer Chapter on Cash and Clearing for detailed instructions.)

Tokens (Presently not in operation)

143.1 There are two types of tokens, viz., Payment Tokens and Cheque Book Tokens.
The payment Tokens for current and savings bank deposits accounts are of different
shape and cast in different metals. These are to be issued by the Counter Clerk to the
account holders/payees presenting cheques/withdrawal forms for payment
accompanied by pass book, wherever applicable. Each Branch is supplied with an
adequate number of the two types of tokens with the name of the Branch and the serial
number engraved thereon. The tokens should remain in the custody of

Cash Department overnight. Care should also be taken to see that the Cheque Book
Tokens are also kept in proper custody overnight.

143.2 The Cheque Book Tokens are to be issued by the Clerk when new cheque books
in current and saving bank accounts are requisitioned by the account holders. These
tokens are issued for the purpose of identifying the persons calling at the Branch to
receive the cheque books.

143.3 In case of loss of cheque Book Token/Payment Token a penalty charge of Rs.
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115/- should be recovered from the customer.

Relaxations regarding the use of cheque Book Tokens

144.1 The practice of issue of cheque Book Tokens may be dispensed with, the prior
approval of the higher Controlling Authority, at Branches where

(a) The number of cheque books issued daily is small,

(b) The cheque book are issued on the spot and,

(c) The Identity of the person to whom the cheque book is issued, is established to the
satisfaction of the Branch. It is only if these pre-requisites are fulfilled, the Branches
may forward such requests to higher controlling authority after weighing the
consequences of eliminating the precautionary measure. There is possibility that in the
absence of cheque-book tokens, cheque books might be delivered to unauthorized
persons. This should be borne in mind before putting up such a request for waiver of
the requirement of issue of cheque book tokens. It should, however, be noted that
except those Branches which have been specially granted permission to dispense with
the practice of issue of cheque book tokens, all branches have to ensure that the
instructions given of cheque book token are followed meticulously.

144.2 The position may be reviewed once in six months, say, during May, November
and recommendation made to the Zonal Manager for consideration of the waiver or
otherwise
Now in system cheque book is entered at the request of the customer’s
application received at the Branch. Alternatively, the request for cheque book can
also be done through Mobile banking, Internet banking & through ATM.

Change in the Specimen Signature of Account Holder

145.1 When it is noticed that an account holder's signature has undergone a drastic
change from the specimen lodged with the Bank, it is desirable to obtain a fresh
specimen signature card duly completed by the account holder in the presence of the
officer. It is important to record the date on the card when such specimen signature is
obtained. The officer concerned must initial against the fresh Specimen Signature on
the new card/slip. The old specimen signature card/slip should then be marked
"cancelled" with two parallel lines across the card/slip with a remark under initials of the
officer, that fresh signature obtained on (date). The old card/slip may then be stapled
behind the new card/slip. The new signature should be scanned immediately and
authenticated.

145.2 The account holder may, in certain circumstances, also desire to change the
mode of his signature in which case he should personally call on the Bank. He should
be properly identified and then a fresh signature should be obtained on specimen
signature card/slip. The same procedure of stapling and initialing in new/old specimen
signature card/slip scanning signature mentioned above should be followed in this case
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also.

145.3 Noting of the date on the new specimen signature card/slip and initials of the
concerned officer against the fresh signature are of great importance, in the absence of
which it may be difficult at a future date establish when and by whom the new specimen
signature was obtained.

Change in Address of Account Holder

146. Branches should follow KYC and AML Policy , norms and guidelines issued from
time to time in regard to identify, address, profession/occupation of the customer and
periodical KYC updating and risk review exercises should also be carried out by the
branches. Monitoring of transactions, reporting of Cash Transaction Report (CTR),
Suspicious Transaction Report (STR), Counterfeit Currency Report (CCR) and other
reports within stipulated time.

146. A Change in address of account holder should be noted only on his written
authority. The signature of the account holder on the letter advising change in address
should be verified by the cancelling officer. The original address in the account opening
form/card, the ledger page and pass book (where applicable) should be neatly ruled
through and the new address written immediately below in the relative column in red
ink/ball point pen, giving reference to date of customer's letter, under initials of the
ledger checking officer. It should be ensured that the change in address of the account
holder is made only in such accounts indicated by the customer specifically, but not in
all accounts as a matter of routine. In case of any doubt about the intention of the
account holder regarding the change of address in some or all accounts, a reference
should be made to him.

146. A. It is observed that over a period of time, addresses and other contact details of
many of our customers have changed. To correct this situation, get a customer update
form (APPENDIX XXXXV) filled from the customers and obtain. Since all the formalities
regarding KYC Norms are completed and due diligence is already conducted at the
time of opening of the account; Branch know the identity of the customer. In the event
of change in this address due to relocation or any other reason, customers may intimate
the new address for correspondence to the bank within two weeks of such a change
and fresh address proof may be submitted within a period of six months. Branches
should verify this new address.

Additional Rate of Interest to Staff Related Accounts

147. Additional Rate of Interest of 1.00%, over and above the rate of interest
mentioned in the schedule of interest rates shall be paid on the Domestic Saving Bank
Deposit and Domestic Term deposit for specific maturity buckets to bank’s Staff/Ex Staff
and their exclusive associations as well as on deposits of Chairman, Chairman &
Managing Director, Executive Director or such other Executives appointed for a fixed
tenure, subject to:
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 (i) The additional interest is payable till the person continues to be eligible for the
same and in case of his ceasing to be so eligible, till the maturity of a term
deposit account.
(ii) In case of employees taken over pursuant to the scheme of amalgamation,
the additional interest is allowed only if the interest at the contractual rate
together with the additional interest does not exceed the rate, which could have
been allowed if such employees were originally employed by the bank.
(iii) In the case of employees taken on deputation from another bank, the bank
from which they are deputed may allow additional interest in respect of the
savings or term deposit account opened with it during the period of deputation.
(iv) In the case of persons taken on deputation for a fixed tenure or on a contract
of a fixed tenure, the benefit will cease to accrue on the expiry of the term of
deputation or contract, as the case may be.
(v) Bank Employees’ Federations, in which bank employees are not direct
members, shall not be eligible for additional interest.
(vi) The additional interest may be paid on the following deposits after obtaining a
declaration from the depositor concerned, that the monies deposited or which
may be deposited from time to time into such account belong to the depositor:

(a) member or a retired member of the bank’s staff, either singly or jointly with any
member or members of his/her family; or

(b) The spouse of a deceased member or a deceased retired member of the bank’s
staff; and

(c) An Association or a fund, members of which are members of the bank’s staff;

147. A to avail the benefit of additional interest of 1.00%, the Staff/Ex-Staff member has
to be the First/Sole account holder. The employee Id (PF No.) is entered in the
Customer Id linked to the Term Deposit Account shall only be allowed to avail additional
rate.

147 B. The benefit of 0.50 % additional interest rates subject to threshold specified from
time to time, as admissible to senior citizens shall be eligible to Senior Citizen Staff/Ex-
Staff as well, over and above the 1.00% additional interest payable to them by virtue of
their being retired members of the banks’ staff.

147 C. Ex-Staff members, who have retired from the Bank's service either on attaining
the superannuation age or seeking voluntary retirement, are eligible for 1% additional
Rate of Interest in Domestic Saving Bank Deposit and Domestic Term deposit for
specific maturity buckets. Staff members who have retired compulsorily or resigned /
dismissed / terminated / removed from the Bank's service shall not be eligible to avail
Additional ROI.

148. The benefit of additional interest rate on deposits on account of being bank’s
own staff or senior citizens is not available to Rupee Deposits of Non Residents/ Foreign
Currency Deposits i.e. NRE, NRO, FCNR (B) and RFC deposits.
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 Temporary Overdraft
149. No temporary overdraft should be granted to an employee of the Bank.

Garnishee Order
150.1 The Bank is prohibited and restricted from honoring the customer's cheques after
a Garnishee Order (Prohibitory Order) issued by a competent Court in execution of a
decree in a Civil Court has been served on the Bank. (Also refer paragraph 152.3).
Whether Garnishee Order covers the whole of the credit balance of the account
concerned or only a part of the amount will depend on the terms of the Order. If no
amount is specified in a Garnishee Order, then the Order will apply to the whole amount
but if restrictions in the Garnishee Order apply only to a named amount, the Bank may
earmark such a sum and allow the customer to operate on the account for the balance.
Garnishee Order applies to the debts actually due from the Bank to the customer on
the date of receipt of the Order. The amount of a Term Deposit can be attached before
the date of maturity but can be paid only on or after the date of maturity. The order does
not affect future debts. Upon service of a Garnishee Order, the time and date of the
receipt thereof should be noted prominently in the account concerned. The original
Garnishee Order should be compared carefully with the copy which should be kept on
the Bank's record.
150.2 Upon the receipt of a Garnishee Order, all accounts in a customer's name must
be taken into consideration and a debit balance may be set off against the credit
balance before arriving at the attachable sum. If a Garnishee Order specifies one
judgement debtor, a joint account is not attached. This means that a Garnishee Order
citing a sole judgement debtor will not attach a joint account in which such a debtor is
a constituent. In such a case an affidavit is required to be filed in Court stating that there
is a joint account in the name of the judgement debtor and another person and,
therefore, the debt in the account is not attachable. This can be done with the help of a
junior Advocate.
150.3 Where a Garnishee Order has been served and cheques have been received
through clearing in the day, it is the practice to pay the cheques, but Branch Managers
should use their discretion and pay the cheques with circumspection; where the credit
balance includes uncleared effects, the amount of such items is not attached unless
there is an agreement to allow drawings before clearance.
150.4 The attachment order relates to the funds in the account as on the date and time
of receipt of the Order which are immediately payable to the account holder. When the
Bank receives Garnishee Order, it should advise the customer of its receipt and that
cheques drawn by the customer will be honored only if the balance left after satisfying
Garnishee Order is adequate to meet them.
150.5 lf the circumstances demand, the cheques presented after service of the Order
should be returned with the answer "Refer to Drawer".
150.6 Moneys in a Trust Account where the judgement debtor is a trustee are not
attachable under the Order.
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150.7 The banker is not entitled to deduct interest and commission charges accruing
from any attachable balance.

Notice from Income Tax Authorities

151.1 A notice under Section 226(3) (ii) of the Income Tax Act, 1961 may be issued in
writing by the Income Tax Officer to any person who holds or may subsequently hold
any money for or on account of the assesse jointly with any other. For the purpose of
this Sub-Section, the shares of the joint holder in such account shall be presumed to
be equal until the contrary is proved.
151.2 In terms of this Section and provisions thereof, an Income Tax Officer by a notice
in a prescribed form may call upon the Bank to pay to him the amount due to him by
way of arrears of income tax super tax/penalty/ interest/fine by an assesse. Who may
be a customer of the Bank? In law, such a demand is deemed to have been made under
the authority of the tax payer and the receipt of Income Tax Officer will constitute a good
and sufficient discharge of the Bank's liability to the account holder concerned. The
Bank should, therefore, pay the amount demanded by the Income Tax Officer forthwith,
subject to adhering to the requirements of the following paragraphs and advise the
account holder(s) suitably.

151.3 When a notice under this Sub-Section is issued to a banking company, it shall
not be necessary for any pass book, deposit receipt or other documents to be produced
for the purpose of any entry, endorsement, etc. before payment is made,
notwithstanding any rule, practice or requirements of the bank to the contrary.

151.4 As per the I. T. Act 1961 and guidelines prescribed by the Central Board of Direct
Taxes and the Ministry of Finance, the I. T. Authorities ought to call for information
which is related to a specific assesse. They ought not to call for information of an
absolutely roving nature in the case of banks. So on receipt of notices and/or summons
of roving and fishing nature, the Zones/Branches should approach the concerned I. T.
Authorities or their senior officers and request that the notice/summons either be
withdrawn or modified. Under no circumstances such notices be ignored as it would
otherwise expose them to penalty for non-compliance.

151.5 Sub-Section (1) of Section 131 of I. T. Act 1961 confers the I. T. Authorities the
power to ask for information in respect of pending proceeding. The power under Section
131 (1A) of I.T. Act 1961 can be exercised even in absence of pending proceedings but
the presence of a "reason to suspect" is a pre-condition to exercise this power.

151.6 Section 133 (6) of I. T. Act 1961 empowers specified I. T. Authorities to require
any person including a banking company or any officer thereof, to furnish information
in relation to such points or matters as, in the opinion of the authority will be useful for,
or relevant to, any enquiry or proceeding under the Act. The power in respect of an
enquiry, in a case where no proceeding is pending, shall not be exercised by any I. T.
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Authority below the rank of Director or Commissioner as the case may be.

Notice of Single Accounts

152. If the assessee has an account in his single name, the entire balance in the
account or the amount of arrears of income tax etc., mentioned in the notice, whichever
is less, should be paid to the Income Tax Officer.

Notice in Joint Accounts

153.1 If the assessee has a joint account in the names of himself and one other person,
half the balance in the account as on the date of receipt of the notice or the arrears of
income tax etc. mentioned therein, whichever is less, should be paid to the Income Tax
Officer. This is irrespective of whether the account is operated jointly or by either or
survivor of the depositors.

153.2 If the account is in three names and the assessee is one of them, one-third of
the balance in the account as on the date of receipt of the notice or the arrears of income
tax etc., mentioned therein, whichever is less, should be paid to the Income Tax Officer,
irrespective of the mode of operation. This is because under this Section, the share of
each joint account holder is presumed to be equal unless the contrary is proved. The
Bank does not ordinarily have any notice of the actual share of each account holder; it
will have to proceed on the presumption mentioned in the Section.

Notice in Term Deposit Account

154. If the assessee has a Term Deposit account, the amount thereunder does not
become payable until the date of maturity of the deposit. The notice under Section 226
(3), however, calls upon the Bank to pay to the Income Tax Officer even such moneys
as may subsequently become due from the Bank to the assesse-account holder. The
Bank will, therefore, have to pay the requisite amount on or immediately after the date
of maturity. On receipt of such notice, Branches should immediately inform the account
holder of having received the notice and that the Bank will make the payment on the
date of maturity to the Income Tax Officer., unless the Bank receives an intimation from
such an office withdrawing the notice. The account holder may then, if he so thinks fit,
make some arrangement with the Income Tax Officer and have the notice to the bank
withdrawn, if possible. If no such withdrawal is intimated, the payment will have to be
made on the date of maturity. If the Term Deposit is joint, the payment will be on the
pro rata basis.

Advice to Account Holders

155. Under this Section, the Income Tax Officer is required to send a copy of the notice
to the assesse. Even then the Bank should inform the account holder(s) before and
after making the payment to the Income Tax Officer.

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 Notice in Advance Accounts

156. If an assessee has, in addition to deposit account(s), borrowing facilities whether

singly or jointly with the Bank and the outstanding debit balance(s) in advance
account(s) is more than the balance(s) of his deposit account(s), the Income Tax officer
should be informed of the balances in the account(s) and the Bank's right of lien or set
off and that the Bank is unable to comply with the notice. The customer should be
immediately informed of the Bank's claim. If the Income Tax Officer should contest the
Bank's right to such security and/ or lien or set off, immediate reference should be made
to Head Office for further instructions, giving full details and forwarding copies of all the
relevant correspondence. In case the outstanding debit balance in the borrowing
account(s) is lower than the deposits of the assessee, the balance available after full
liquidation of the advance should be paid to the Income Tax Officer.

156.1 Overdraft Accounts - An overdraft (to the extent the credit facility is not utilised)
does not represent money due to the assessee- customer nor can the bank be said to
be holding any money for or on account of the assessee. However, if the account has
a credit balance then the bank can be said to be holding money for or on account of the
customer and the credit balance is attachable.

156.2 Other Loan Accounts - If there is credit balance in the account then the bank can
be said to be holding money for or on account of the customer and the credit balance
is attachable.

Notice in Accounts of Deceased Customers

157. If a notice is served on the Bank under Section 226(3) of the Income Tax Act,
1961, attaching moneys in respect of the tax dues of the deceased account holder in a
joint account to be operated upon in anyone of the following manner viz. :

(a) Either or Survivor

(b) Both of us or Survivor

(c) Anyone or Survivors

(d) Any Two or Survivors

(e) Former or Survivor

The Bank would be justified in refusing to pay in response to the notice. The Bank's
liability would be to make payment of the entire amount to the survivor(s); provided such
notice is received after death of the joint account holder from whom the tax recovery is
to be made. The reason to be given for such refusal should be that on the date of service
of such notice no amount was due and payable by the Bank to the estate of the
deceased.

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 Banker's Lien
158.1 A lien is the right to retain property belonging to a debtor until he has discharged
a debt due to the retainer of the property.
158.2 Banker's lien is a general lien covering all securities, documents and things
deposited with him as a banker by a customer or coming into his possession in the
ordinary course of his business as the banker of his customer.
158.3 The lien does not operate if there is an express contract or circumstances that
show an implied contract inconsistent with lien. For instance, deposit of securities for
the purpose of Safe Custody is a purpose inconsistent with the banker's lien.
158.4 In the absence of a contrary agreement, a banker has a lien on all bills, cheques
and notes sent to him by a customer for collection.
158.5 Banker's lien is sometimes described as "an implied pledge". This means, the
banker has power not only to retain but also to realize the securities over which he has
a lien. But before doing so, he should give reasonable notice to his customer.
158.6 Strictly speaking, there is no right of lien on money in a customer's account.
Bankers, however, have a right of set off on the moneys in Deposit Accounts.

Banker's Right of Set Off

159. The right of set off is also called the right to combine Accounts. The banker can
set off the balance or money in a Deposit Account against the debt due to him in an
Advance Account of the customer, subject to the following:

(a) The debt due to the banker must be a sum certain due and recoverable at the date
of setoff. This means, a notice of demand calling upon the customer to repay the
advance should be given before the right is exercised. The notice should state that on
the failure of the borrower to repay the debt within the time stipulated, the Bank will take
all or any of such steps for the recovery of the advance as the Bank is entitled under
the security documents and law, including the exercise of its right of set off.

(b) If the customer has one account of his own money and another as Trustee, the
banker cannot set off a credit balance in the Trust Account against the debit balance in
his personal account.

(c) There should not be any agreement, express or implied, inconsistent with the right
of set off.

(d) The creditor and the debtor should be one and the same person or one and the
same set of persons. If the Deposit Account is in the names of A and B of whom only A
is indebted to the Bank, no right of set off can be exercised.

Secrecy of Customer's Accounts

160.1. It is an implied term of the contract between the banker and the customer that
the former will not disclose the condition of his customer's account to a third-person or
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party without the express or implied consent of the latter except on reasonable and
proper occasions. The obligation to observe secrecy does not end even with the closing
of the customer's account. Branches should, therefore, take scrupulous care not to
disclose the state of customers' accounts to the third-party without the authority of the
customer even if the person approaching is known to the Bank and/or to the customer.
For example, if a customer has his "personal" and "business" accounts at a Branch and
if he deputes to the Bank an employee in connection with the "business" account, no
particulars of his "personal" account should be given to the employee for passing on to
the customer.

Furnishing of data - Violation of Secrecy Obligations

161.2. Branches receive, from time to time, requests for data/information on certain
aspects of their business from Government and other agencies for academic /
theoretical purposes. In this connection, Reserve Bank of India directives are:

"The bankers' obligation to maintain the secrecy arises out of the contractual
relationship between the banker and customer, and as such no information should be
divulged to third parties except under circumstances which are well defined. The
following exceptions to the said rule are now accepted.

(a) Where disclosure is under compulsion of law

(b) Where there is a duty to the public to disclose

(c) Where interest of bank requires disclosure and

(d) Where the disclosure is made with the express or implied consent of the
customer.The banks should, therefore, appreciate the implications of furnishing
information that would violate the provisions of secrecy in the background or
circumstances stated above."
In view of the above, Branches should note that whenever such requests are issued,
they should be satisfied that the information being sought is not of such a nature as will
violate the provisions of the laws relating to secrecy in the banking transactions. In
cases in which branches have doubts whether the furnishing of information might violate
secrecy provisions, they should get specific legal advice from the Zonal Offices.
Closing of Accounts

162.1. Whenever an account holder desires to close an account, a request in writing

duly signed by all the account holders should be obtained.

162.2. It should be ensured that all unused cheque forms issued to a current
account/savings bank customer whose account is closed, are returned to the Bank
immediately or within a reasonable time after the account is closed, as such unused
cheque forms are likely to be used for fraudulent purposes. If the unused cheque forms
are not returned even after two reminders, the question of further reminders is left to
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the discretion of Manager or at larger Branches, of the Deputy Manager/Deputy Chief
Manager. The bottom right-hand (i.e. the signature space) of each cheque form
returned should be torn off; only whole cheque books returned should be used for pay
slips or for issue of loose cheques to account holders. (Cheques of some foreign
Branches bear revenue stamps. In the event the cheques of foreign Branches with
revenue stamps are returned, they should be sent without mutilation to the Branch of
issue so that it can claim refund of stamp duty).

162.3. A remark "Account Closed" with date (on which the account was closed) should
be made (or rubber stamped) under the initials of the ledger checking officer on the
relative account opening form/card in such a manner as not to obliterate the specimen
signature(s). A similar remark (with date) should be made under the initials of the ledger
checking officer in the Cheque Book Delivery Register against the serial number of the
cheque book issued with distinctive numbers of the unused cheque forms which are
returned by the current/savings bank account holder. The specimen signature cards of
such closed accounts should be removed from the cabinet in which such cards are filed
and kept on record seperetaly.

162.4. When an account is closed, the account holder should be asked to produce the
pass book to the Bank (where applicable). It should be written up to date and returned
to him marked "Account Closed" at the foot of the last entry and on the front cover.

162.5. When an account is closed, the plastic cover of the pass book issued, if any,
should not be removed while returning the pass book.

162.6. Charges for closure of a/c should be recovered as advised by HO from time to
time (through circular on Service charges).

Non KYC compliant Accounts should be freezed\ closed as per laid down KYC-AML
Policy\norms\guidelines from time to time.
Care and Custody of Bank's Books

163.1. No unauthorized person should be allowed access to Ledgers, Balance Books,

Extract Books, Supplementary Cash Books, etc. These should remain in the custody of
an officer and be kept safely locked when not in use. The Manager should ensure
personally that all these books and other records of the Branch are, under no
circumstances, left lying outside overnight on the counters etc. These books should be
kept overnight in strong rooms/fire proof safes or almirahs where available; otherwise
they should be stored in other steel cupboards/almirahs.

163.2. These books are important records of the Bank and should be very carefully
preserved. Balance Books and Extract Books should be kept neat and in good order.
They might prove useful to the Bank to reconstruct the records, if necessary. All ledgers
when they become loose by constant use should be rebound even if due for re-writing.

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 Service to Senior Citizens

164.1. Senior members of the society deserve a special treatment in any service
industry, looking to their age, physical limitations, temperament and above all the
service they have rendered to the society in their prime days. Branches should hence
take adequate care in providing services to senior citizens and make necessary
arrangements to provide efficient counter service. Senior citizens should not be made
to wait in the long queues for availing services or completing certain banking
transactions. The following points may be noted in this context:

(a) Senior citizen is a person above age of 60 years. (Branches should not question the
eligibility if any customer is claiming to be so)

(b) Branches with large number of Pension accounts may arrange separate counter
while disbursing pensions during the first week of the month.

(c) Normally, queues are formed in the banking hall for withdrawal of cash, deposit of
cash, deposit of cheques, updating of pass books, tendering taxes challans, share
applications, Electric bills, Telephone bills etc. Senior citizens should be exempted from
facing such queues. Staff members should be directed to entertain such customers
ensuring minimum inconvenience to other customers.
(d) All staff members should treat senior citizens with courtesy and respect. They should
be given patient hearing invariably and guided properly in completing their banking
transactions. Manager, Floor Manager should take extra care in attending to disabled
senior citizens.
(e) Complaints/Grievances or any representations from senior citizens, verbal or written
should be dealt with as far as possible on the spot. Arguments/dispute with the senior
citizens should be avoided.
164.2. While dealing with aged customer, (senior citizens) Branches are likely to come
across some very old, sick and incapacitated customers having pension or regular
singly operated accounts or such persons may approach for opening new accounts.
The situation may arise sometime when account holder may not be able to operate his
account himself/herself or through a representative for being unable to sign cheque or
withdrawal slip due to certain physical incapability. To overcome such situations and
help the distressed customer, the following guidelines should be uniformly adhered to
by Branches:
A) The cases of sick/old/incapacitated account holders fall into following categories:
a) An account holder is too ill to sign a cheque/withdrawal slip and cannot be physically
present in the Branch to withdraw money from his bank account but can put his/her
thumb impression on the cheque/withdrawal form and
b) An account holder who is not only unable to be physically present in the Branch but
is also not even able to put his/her thumb impression on the cheque/withdrawal form
due to certain physical defect/incapacity.
B) With a view to enabling the old/sick/incapacitated customers as described above to
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operate their single accounts, the following procedure should be followed:
a) Where thumb or toe impression of the old/sick/incapacitated account holder is
obtained, it should be identified by two independent witnesses known to the branch,
one of whom should be a responsible bank official.
b) Where the customer cannot even put his/her thumb impression and also would not
be able to be physically present in the Branch, a mark can be obtained on the
cheque/withdrawal form which should be identified by two independent witnesses, one
of whom should be a responsible bank official. This mark can be placed by the person
in any manner. It could be the toe impression as suggested above, the point to be noted
is that there should be physical contact between the person's limb and the document
i.e. cheque or withdrawal form.
c) The customer should also be asked to indicate as to who would withdraw the amount
from the branch on the basis of cheque/withdrawal form as obtained above and that
person should be identified by two independent witnesses. The person who would be
actually drawing the money from the Branch should be asked to furnish his/her
signature to the Branch.
164.3. While allowing operations in the account as spelt out hereinabove, certain
precautions should be taken to avert perpetration of frauds or misappropriation of funds
in such accounts, which are generally as below:
i) A remark /note should be made in bold letters on the specimen signature card and
the Ledger folio or registered in the computer operated system that the account is of an
incapacitated person.
ii) As far as possible the account holder should be asked to have a joint account with
close relation and make a nomination in the account.
iii) If the old/sick/incapacitated person is not willing to open and operate a joint account,
he/she should be convinced to give Power of Attorney/Mandate for operating the
account. The Power of Attorney or Mandate should be carefully examined and noted in
relevant branch records.
iv) Care should be taken in collection of cheques for large amounts.
v) Cheque book should be made available strictly on verification of the transactions in
the account and on proper inquiry and authorization of the person collecting the cheque
book.

vi) The facility should be rendered in deserving cases, so as to provide relief to the old
/ sick / incapacitated persons who are unable to withdraw cash.

vii) The above points are illustrative and not exhaustive; the official allowing such
operations should fully satisfy himself about circumstances of each case and identity of
the person collecting cash on behalf of the old/sick/incapacitated person should be
established beyond doubts.

Branches are advised to open pension account in the name of pensioner as first holder
and joint name of his/her spouse provided the spouse’s name appears on Pension
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Payment Order (PPO).

Branches are advised to provide a clearly identifiable dedicated counter or priority to

Senior citizens and differently Abled persons including visually impaired persons.
We have to provide Digital Life Certificate under Jeevan Praman Scheme Pensioners
can submit physical Live Certificate from any of the branch of the pensioner’s paying
Branch.
Banks are advised to provide minimum 25 cheque leaves every year, if required in
Saving Bank free of charge, by ensuring the date of birth of depositor in the account
master system.

164.4: Facilities to Senior Citizens:

Please also refer various schemes for Senior Citizens, from time to time

Parameters Norms
Eligibility One who has completed 60 years of age.
Verification of School Leaving Certificate/ LIC Policy/ Passport/ Voter’s
Age Identity Card/ Pension Payment Order/ Employment
Discharge Card/ Identity Card with Date of Birth Indicated
therein or any other document acceptable to the bank.
Joint Accounts Can be allowed – only with close relatives, i.e. Father,
Mother, Spouse, Brother, Sister, Son or Daughter. The
Close Relative need not be a Senior Citizen.
The first deposit holder should necessarily be the Senior
Citizen.
Deposit Scheme All Term Deposits + Recurring Deposit Scheme,
including Flexi RD Scheme.
Minimum Amount Rs.5, 000/- in Term Deposit. Additional Rate of Interest
acceptable @0.50% currently, is applicable for the deposits up to
Rs.1 cr. & deposits of 6 months & above to 10 years.
Rs.100/- in normal RD & Rs.1,000/- in Flexi RD A/cs.
Rate of Interest Additional Rate of interest as per the guideline prevailing
at the time of accepting the deposit.
Nomination Available.
facility

Customer Service:

Role of Grahak Bandhu

Our Bank is using services of Business Correspondent\Business Facilitator etc. In this

regard, branches should follow the guidelines prevailing from time to time.

165. Customers and especially the visitors who come to our branches for the first time
to start a relationship are in search of a friendly face at a visible help desk counter, who
will reach out and help the first time visitor / customer. Even existing customers many
136
a times require guidance on various banking issues.

The ‘Grahak Bandhu’ will perform the above important functions. The way we welcome
our guests and make them feel important, these ‘Grahak Bandhu’ would welcome the
customers with a warm smile, greetings and then help and facilitate their tasks in the
branch. They will educate the existing customers about our various products and also
help them migrate to alternative delivery channels.

The JOB of ‘Grahak Bandhu’ will be to:

i) Remain in the banking hall throughout the business hours.

ii) Welcome first time visitors / customers with a smile, greetings and if possible
calling existing customers by their name to give them recognition.
iii) See that all necessary forms are stocked at customer desk, signage in the
branch are proper, branch is neat and clean.
iv) Remain on the move and oversee whether there are any customer service
bottlenecks, like too many customers at a counter, slow movement etc.
v)Assist customers in their queries/ tasks, take them to the respective seats if need
arises.
vi) Keep a stock of various stationary items/ publicity material with him so that he
can provide them to the customers.
vii) Generate awareness about our various products and guide them to the relevant
desk for further action if customer evinces interest
viii) Educate the customers to use ATMs, where the branch has an ATM or guiding
customers about nearby locations of ATM and its usage, so that they can migrate to
automated delivery system.

‘Grahak Bandhu’ will be the fountainhead from which the care and concern for the
customer needs’ will flow in such a manner that it gradually embraces the entire gamut
of branch activities.

Bank's Policy on Doorstep Banking

166.1 DOORSTEP BANKING THROUGH BRANCH STAFF / BUSINESS
CORRESPONDENCE:
1. In compliance to Reserve Bank of India vide notification Ref. No. RBI/2017-18/89
DBR.No.Leg.BC.96/ 09.07.005/201718 dated 09.11.2017 to provide Doorstep Banking
Services for basic banking services to Senior Citizens of more than 70 years of age and
Differently Abled or Infirm Persons (having medically certified chronic illness or
disability) including those who are Visually Impaired, Bank had its own policy namely
Bank's Policy on Doorstep Banking Facility to Senior Citizens and Differently Abled
Persons which was approved by Board on 25th June 2019.
2. Under this channels, the Doorstep Services will be provided by the parent branch to
137
senior citizens of more than 70 years of age and differently abled or infirm persons who
are under the radius of 5 KMs distance from the home branch and request for service
in this regard has been made during business hours. This services will be provided only
to fully KYC compliant saving account holders (with or without Term Deposit) having
valid registered mobile number with the Bank.
3. The following financial and non-financial DSB services shall be available through
branch.
Financial Services Non- Financial Services
Cash Pickup facility for deposit of Pickup facility of cheques for collection in
amount in accounts upto Rs. 20,000/- account
per request. Pickup facility of cheques book requisition
slip.
Cash Delivery facility for withdrawal Pickup facility of 15H form
of amount from the account upto Rs. Pickup facility of life certificate
20,000/- per request. Pickup facility of additional / Re-KYC
documents
Delivery Facility of Demand Draft / Pay
order
Delivery facility of Term Deposit Advice

166.2 PSB ALLIANCE DOORSTEP BANKING - THROUGH OUTSOURCING

AGENCIES
1. To improve ease of Banking, Department of Financial Services, Government of India
under their roadmap for banking reforms under EASE - Banking for Customer
Convenience had advised banks to provide Doorstep Banking Facilities through a
Centralized System and a Sub-Committee in the matter comprising members from
State Bank of India, Punjab Bank, Bank of Baroda, Canara Bank, UCO Bank and
Allahabad Bank was formed at IBA level to expedite these reforms across all the Public
Sector Banks for the uniformity of process /services. Further, as decided in the Sub-
Committees, UCO Bank was designated as the Anchor Bank for Door Step Banking
(DSB) through U I Touch Points (UTP) for all the PSBs.
2. Further, through due process two vendor i.e M/s. Atyati Technologies (P) Ltd. and
M/s. Integra Micro System (P) Ltd., have been shortlisted / declared as L1 and L2 by
UCO Bank (Anchor Bank) and have been assigned 60 and 40 centers in PAN INDIA
respectively to provide Door Step Banking Services (DSB) through Universal Touch
Points (UTP) on behalf of all 18 public sector Banks including our Bank. 3. Under this
mode, the Doorstep Services will be provided to all fully KYC compliant account holders
with valid registered mobile number with the Bank (without any age / physical disability
criteria), through outsourced agencies under PSB Alliance Doorstep Banking Services
(DSB).

4. The following financial and non-financial services shall be available under PSB
alliance doorstep banking.

138
 Financial Services Non- Financial Services
Cash withdrawal: Post Service Request Pre Service Request
Minimum Rs. 1000/- Negotiable Instruments: Account Statement
and Maximum Rs. Cheque , Pay order, DD etc. Term Deposit Receipt
10,000/- Acknowledgement
• Card Based New Cheque Book TDS /Form 16 Certificate
• AEPS Requisition Slip
15G/15H Forms Pre-Paid Instrument/Gift
Card
IT/ GST Challan Pre-Paid Instrument/Gift
Standing Instructions Card
Request
Life Certificate (Digital/Fall
Black Mechanism)
Add/Edit/Cancel
Nomination w.e.f.1-11-2021
Fund Transfer Request
w.e.f.01-11-2021

Now, we have clubbed our existing policy i.e. Bank's Policy on Doorstep Banking
Facility to Senior Citizens and Differently Abled Persons with the PSB alliance Doorstep
Banking and named the policy as Bank's Policy on Doorstep Banking.

The revised policy is aligned with the ethos of guidelines on PSB Alliance Doorstep
Banking Services (DSB) issued by Department of Financial Services, Government of
India Reserve Bank of India and Indian Banks Association from time to time under their
roadmap for banking reforms under EASE - Banking for Customer Convenience and
Reserve Bank of India notification Ref. No. RBI/2017-18/89 DBR.No.Leg.BC.96/
09.07.005/201718 dated 09.11.2017 on providing Doorstep Banking Services for basic
banking services to Senior Citizens of more than 70 years of age and Differently Abled
or Infirm Persons (having medically certified chronic illness or disability) including those
who are Visually Impaired.

Obtaining Permanent Account Number (PAN)

Branches should follow the Income Tax guidelines\norms prevailing from time to time.
Branches should also follow the KYC-AML guidelines prevailing from time to time.

167. Branches are required under Rule 114 B:

1.1 To verify and keep on record Permanent Account No.(PAN) of customers

(photocopy of PAN Card or any other documentary evidence in respect of PAN issued
by Income Tax Department duly certified by the customer may be kept on record) in
respect of the following banking transactions:

139
 a. Opening an account.

b. Investment in Term Deposits exceeding Rs.50, 000/-.

b. Payment in Cash for purchase of Demand Drafts or Pay Orders for an amount
aggregating Rs.50, 000/- or more during any one-day.

c. Deposits in Cash aggregating Rs.50, 000/- or more in the bank account.

d. Issuing of Credit Card.

e. Investment in RBI Bonds aggregating Rs.50, 000/- or more.

1.2 In case the customer is a minor who applies for opening an account.

1.3 item (a) above) or for investment in term deposit ( referred to in para 1.1. item
(b) above) and such minor does not have any income chargeable to tax, he is
required to quote the PAN of his father or mother or guardian as the case may
be.

1.4 In case of persons who have not been allotted a PAN and who enter into any of
the above specified transactions viz. para 1.1. item (a) to (f), branches must
obtain a declaration in Form no.60 Appendix XXXXII giving therein particulars of
such transaction.

2.1 In case of persons (not having PAN) who have agricultural income and are not
in receipt of any other income chargeable to income tax, branches are required
under Rule 114 C to obtain a declaration in Form No.61 as and when they
undertake any transaction specified in para 1.1 item (a) to (f) (Appendix XXXXIII).

2.1.1 It may however be noted that, quoting of PAN / giving a declaration in Form
no.60 or Form no.61 is not applicable to:

i. Non – Residents;
ii. Central Government / State Government and Consular Offices in transactions
where they are payers.

2.1.2 It is the duty of the Branch Manager or the concerned dealing officer to ensure
that PAN is correctly quoted in the document received from the customers who
undertake any of the transactions specified in para 1.1 item (a) to (f)

3. Branches are required under Rule 114 D to forward to the Commissioner of

Income Tax (Central Information Bureau) having territorial jurisdiction over the
area in which they are situated, copies of all declarations (other than those
obtained at the time of opening of bank account) received in Form no.60/Form
no.61 in two installments viz. forms received up to 30 th September to be
140
 forwarded latest by 31st October of that year and those received up to 31 st
March to be forwarded by 30th April of that year.

Furnishing of Annual Information Return

4.1 Branches are required to furnish an annual Information Return under Section 285BA
read with Rule 114 in respect of the following transactions:

a. Cash deposits aggregating to Rs.10 lakh or more in a year in any saving bank
account of a customer;
b. Payment made by any person for bills raised in respect of Credit Card issued to
that person aggregating to Rs.2 lakhs or more in a year.

4.2 The above return is required to be furnished in Form no.65 duly verified as indicated
therein. Further the above return comprising Part A and Part B of Form No.65 should
be furnished on computer readable media being a floppy (3.5 inch and 1.44 MB
capacity) or CD-ROM (650 MB or higher capacity) or Digital Video Disc (DVD), along
with part – A thereof on paper. The return should be accompanied with a certificate
regarding clean and virus free data.

4.3 The Annual Information Return should be furnished to the Commissioner of Income
Tax (Central Information Branch) having territorial jurisdiction over the area where the
branch is situated or to any agency authorized by the CBDT to receive such return on
behalf of the Commissioner on or before 31st August immediately following financial
year in which the transaction is registered or recorded

4 Please note that the instructions contained in Form No.60 / Form No.61 / Form No.65
must be meticulously adhered to while filling the said forms.

Branch should submit Monitoring of transactions, reporting of Cash Transaction Report

(CTR), Suspicious Transaction Report (STR), Counterfeit Currency Report (CCR) and
other reports within stipulated time.

Obtention of Photographs
168. In terms of Reserve Bank of India directives, Banks are required to obtain
photographs of the depositors/account holders in all new deposit accounts. Salient
points on obtention of Photographs:
(i) Photographs must be obtained in all types of deposit accounts.

(ii) The cost of photographs should be borne by the account holders or as

advised from time to time.

(iii) In case of operative deposit accounts like Saving Bank, Current Deposit etc.,
photographs of those who are authorized to operate the account are to be
obtained.

(iv) In Term Deposit Accounts photographs of all depositors in whose name

141
 the deposit receipt stands may be obtained except in the case of deposits
in the name of minors where guardian's photographs could be obtained.

(v) The requirement of obtaining photographs is in addition to the obtaining of

introduction.

vi) The photograph should be properly pasted on the account opening card at
the place provided for.

(vii) The signature of the account holder/s signatories to the account should be
obtained across the photograph(s).

(viii) The branch's round stamp should be affixed halfway across the card and
front of the photograph without disfiguring/mutilating the picture.

(ix) Photographs are to be obtained both in resident and Non-resident

accounts.

(x) The requirement of photographs is also applicable to pardanashin women.

(xi) Where a person(s) is/are having more than one deposit account only one set
(normally not more than two copies) of photographs need be obtained and
separate photographs should not be obtained for each category of deposit.

(xii) Photocopies of driving license, passport etc. containing photographs would

not be sufficient for the purpose. Obtaining of photographs is a must.
(xiii) Photographs cannot be treated as a substitute for specimen signature.

(xiv) When a minor becomes major, a latest photograph should be obtained from
him/her.

Capital Gains Account Scheme 1988 & BOI Capital Gains Tax Exemption Deposit
Scheme 1997
169.1 The Capital Gains Account Scheme 1988 was introduced in 1988 and applies to
all assesses who are eligible for exemption under Section 54, 54B, 54D, 54F or 54G of
the Income Tax Act 1961. Under the scheme, Branches can open Savings Bank
Account or Term Deposit Account for 3 years. The minimum period of deposit is 7 days
in respect of single term deposit of Rs. 15 lac and above.

In other cases, the minimum period is 15 days.

169.2 The rate of interest will be the same as applicable to Bank's normal deposits

169.3 Under the Schemes the deposits cannot be encumbered.

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Provision of Cheque Drop Box facility for cheques / instruments for customers

170.1 As per the extant instructions, all cheques/instruments received for collection/
clearing from the customers are crossed before they are accepted.

170.2 As part of better customer service, the Bank has installed Cheque Drop Boxes
at select metro/urban branches.

170.3 Following procedure should be adopted for crossing of cheques/ instruments

while providing Cheque Drop Box facility for customers: -

“Branches should display suitable notice near the Drop Box advising the
customers/ their agents or employees to affix Bank’s Crossing Stamp before
dropping the cheques/instruments in the Box. For this purpose the Crossing
Stamp may be tagged to the Box or kept near the Drop Box”

170.4 The Cheque Drop Box should be kept in such a prominent place that it is visible
to the customers and opened at least 3 – 4 times in a day so that the cheques deposited
in the box are sent in the same day’s clearing.

170.5 However, if the customer desires the counterfoil / acknowledgement for deposit
of the cheques/instruments, he may be advised to avail of the usual counter facility
where procedure regarding issuing counterfoil/acknowledgement for instruments
deposited is followed.

170.6 As a precautionary measure against frauds, a special crossing stamp has to be

kept tied near the cheque drop box and notice in bilingual / trilingual should be
displayed on the cheque drop box itself as under :-

“Customers can also tender the cheques at the counter and obtain
acknowledgement on the pay-in-slips / counterfoils. Where the customers
choose to put the cheques in the drop box, it is advised / requested that before
dropping the cheque in the cheque drop box for clearing / collection, the
customer should (in their own interest) ensure that (i) special Bank crossing
stamp kept near the drop box should be affixed on the face of the cheque (above
the MICR band (white band) in such a fashion that it shall not cover the material
facts like MICR Band, amount field, signature of drawer etc.) and (ii) fifteen digit
account number is correctly written at the back of the cheque.”

170.7 Branch should take proper and adequate steps for the safety and security of the
cheque drop box. The details of cheques, which are taken out from cheque drop box,
should be recorded in a register, duly signed by an authorized officer.

143
 Inoperative Accounts – Criteria for classification:

171. A savings as well as current account should be treated as inoperative / dormant

if there are no transactions in the account for a period over two years. For the purpose
of classifying an account as inoperative, both the types of transactions, i.e. debit as well
as credit transactions induced at the instance of customers as well as third party should
be considered. RBI has clarified that interest on term deposits credited to the account
of the customer should be treated as customer induced transaction since it is according
to the mandate of the customer. In such cases, ,the account should be treated as an
operative account as long as the interest on term deposit account is credited to the
Savings Bank account. The Savings Bank account can be treated as inoperative
account only after two years from the date of the last credit entry of interest on term
deposit.

MACT SB A/c (Motor Accidental Claims Tribunal SB A/c)

We have launched the product MACAD (Motor Accidental Claimant Annuity Deposit
and “MACT SB A/c (Motor Accidental Claims Tribunal SB A/c).

172. As per Honorable High Court of Delhi directions and as advised by IBA, we have
formulated a New Product named “MACAD (Motor Accidental Claimant Annuity
Deposit” and “MACT SB A/c (Motor Accidental Claims Tribunal SB A/c).
. This New Product has in-built Term deposit known as “MACAD” and SB A/c known as
“MACT Claims SB A/c”.
The features of these New Products (Annexure I&II) and the specified Scheme Codes
for the Term Deposit accounts and SB accounts opened under this Product, which are
as under:-

- TD549 – Motor Accident Claims Term Deposit (Appendix LII)

- SB170 – MACT Claims SB Account (Appendix LIII)
- MACAD Account opening process flow (Appendix LIV)

Since MACAD (Term Deposit) & MACT SB A/c. is a Special Category of Account as
per direction of High Court, no deviation is permitted other than what is mentioned in
the Scheme.
Please note that scheme code is essential for identification of the accounts under this
category. Please ensure that Scheme Code is correctly chosen while opening of the
144
 Term Deposit Account MACAD and MACT SB A/c.

Escrow Account / Current Account for Developers (as per RERA)

172. Guidelines for opening accounts:

a. Promoters of a Real Estate Development Firm should register themselves with the
Regulator under RERA provided that the projects are ongoing and completion
certificate is not issued.

b. Promoters need to maintain a project specific Separate Current Account/escrow

account for each of their projects as per their state regulator (Respective States have
notified in their guidelines the type of account to be opened i.e. escrow account
or Current Account). Needles to mention that all due diligence and adherence to
existing guidelines to be adhered to while opening a new account. Please note that the
current account is to be opened project wise and should not be treated as normal
current A/c. The withdrawals should be allowed as per state RERA Regulations.

c. While opening the account, documents similar to current account need to be taken as
per the constitution of the developer with the copy of RERA application form or
Registration certificate as the case may be along with escrow agreement in the states
where escrow account is mandatory. An undertaking to be obtained that the promoters
will be solely responsible for any deviation with regards to RERA act. (Annexure –I copy
enclosed)

d. The account to be opened without cheque book for each project and incase of internet
banking facility with viewing rights only (new account to be opened in Separate
customer id in case of existing customer).

e. A minimum 70% of the proceeds from investors and buyers will have to be deposited
in this account. These proceeds can only be used for construction of the project and
cost borne for purchase of land. Section 4 (2) (l) (D) of the Gazette of India bearing
registration no DL—(N)04/0007/2003—16 clearly defines the clauses pertaining to
banking.

f.The withdrawal will be in proportion to the percentage of completion of project. Any

withdrawals from the separate current account/Escrow account will be supported by
promoter’s declaration (Annexure II – copy enclosed)

g. In case the customer is new to bank then Branches should endeavor to open
additional current account for operational purpose. This will help us to retain CASA as
the amount credited from separate current account/escrow accounts will not be
withdrawn immediately. Both the accounts should be opened under separate CUSTID.

h. Please note that separate A/c’s are to be opened project wise and the
withdrawal from these a/c’s can be credited to additional current/cash
145
 credit/overdraft a/c as per instructions of the customer after receipt of requisite
documents.

Please Note:

a)Branches to take care that while opening the account it should be in the name
of Project only (as the account is project specific) and cheque book field is to be
compulsorily marked as N and internet banking to be for view only. The Path for
the same in Finacle is given below.
a) Since the separate account opened will be in the name of the specific project the
amount withdrawn from 2 or more project account’s can be credited to the
Company’s account.

Internet Banking – Option A (view only) to be selected on the form

MOST IMPORTANT TERMS AND CONDITIONS OF SAVINGS BANK ACCOUNTS

(SB A/C)

i. OPENING OF ACCOUNT: All individuals are eligible to open SB A/c. upon submission
of identity and address proof. The Bank may call for submission of KYC document at
regular interval in accordance with the regulatory compliance. The SB A/c should not
be used for carrying out Business/commercial transactions.
ii.
iii. OPERATIONS IN THE ACCOUNTS: Ten Debit entries are allowed free per month.
iv. Normal SB A/c with Cheque Book Facility
 In SB A/c with cheque book facility, all withdrawals must be made by cheques from the
cheque book issued to the account. In extreme circumstances, Branch Manager can
permit cash withdrawal by means of withdrawal form. Use of withdrawal slip will be
allowed to the account holder for self-withdrawal, for a maximum of Rs.25000/- at
parent branch on a written request only.

 Cheque Books up to 25 MICR cheques, will be issued free of charge per year to
account of an individual.

 The Bank reserves the right to withdraw the cheque book facility if the minimum
balance is not maintained or for any other reason whatsoever, with prior intimation.

 Average Quarterly Balance (AQB) is Rs.500/- at Rural & Semi-urban branch and
Rs.1,000/- at Urban & Metro branch for Normal SB Accounts with Cheque Book
Facility.

v. Normal SB A/c without Cheque Book facility

 The withdrawal from the account without Cheque Book facility is allowed with help of
Withdrawal Slip.
146
  Withdrawal Slip when presented for payment must accompany the relative savings
bank pass book.
 Third party cash withdrawals in Savings accounts are not allowed by withdrawal slips,
even if they are accompanied by passbooks.
 Average Quarterly Balance (AQB) is Rs.100/- for Normal SB Accounts without Cheque
Book Facility
vi.
vii. Basic Savings Bank Deposit A/c.
 Basic Savings Bank Account may be opened either with “NIL” or very low minimum
balance.
 Operation in BSBDA-Small Account would be restricted, subject to maximum balance
Rs.50000/-, annual turnover Rs.100000/- and four free transactions per month.
viii.
ix. INTER-SOL OPERATIONS: Inter-Sol deposits are allowed, subject to cash handling
charges. Inter-Sol cash withdrawals maximum up to Rs.50,000/- per day, allowed only
to the depositor(s) having cheque book facility and not to third parties.
x.
xi. RATE OF INTEREST ON SAVING BANK DEPOSIT: Presently, ROI is 2.75% for
amount upto Rs. 1.00 Lakh & 2.90 % p.a for amount above Rs. 1.00 lakh (as per the
balances available in the account) and payable quarterly in the month of February,
May, August and November. Interest is calculated on daily balance maintained in the
account and credited if it is Minimum Re.1/- or above in nearest rupees.
xii.
xiii. NOMINATION FACILITY: Nomination facility is available on all Savings Bank Deposit
accounts opened by the individuals.
xiv.
xv. STANDING INSTRUCTIONS: Standing Instructions/Direct Debit (ECS) facility is
available for SB Accounts. The charges for execution/ failure are displayed on our
Website.
xvi.
xvii. DORMANT ACCOUNT: SB A/c. will be treated as DORMANT, if there are no
operations for two years or more.
xviii.
xix. ACCOUNT PORTABILITY: Facility for transferring the account within our Branches is
available.
xx.
xxi. CLOSURE OF ACCOUNT: A/c. may be closed anytime at the A/c. maintaining Branch.
Closure of A/c. before 12 months is subject to charges, excluding closed within 14 days
from A/c. opening date.
xxii.
xxiii. ATM/MOBILE BANKING/INTERNET BANKING FACILITY: ATM / Mobile Banking /
Internet Banking facilities are available to all SB A/c. holders.
xxiv.
xxv. SERVICE CHARGES & OTHER CHARGES: Charges are levied as per Bank's
guidelines and subject to change from time to time with 30 days' notice. For details
please visit our Bank's website www.bankofindia.co.in.
xxvi.
147
xxvii. CUSTOMER GRIEVANCE/ FEEDBACK: The customer can provide their
suggestions/feedback/grievance, if any, to the concerned Branch Manager/or submit
on our website-https://www.bankofindia.co.in
xxviii. DICGC Cover: Each depositor in Bank is insured up to a maximum of Rs.500000/-
(Rupees Five Lakh) for both principal and interest amount held by him/her.
xxix.
xxx. DISCLOSURE OF INFORMATION : The Bank may disclose information about
customers' a/c if required or permitted by Law, rule or regulations, or at the request of
Public or regulatory authority or if such disclosure is required for the purpose of
preventing frauds, or in public interest, without specific consent of the account holder/s.

148
 .
Appendix I:Paragraph 1.2, 5.4, 84

149
150
151
152
153
154
155
156
157
158
Appendix II: Paragraph 1.2

159
160
Appendix III:Paragraph 23.2, 59, 67

161
 Appendix IV:
Paragraph 23.2
Format for Beneficial Owner:-

BENEFICIAL OWNER (BO)

(Declaration to be obtained from the customer) Name of the Branch

Title of the Account

Account Number
Constitution
[Tick (√) any one] o PARTNERSHIP FIRM / LLP
o COMPANY (PVT. LTD.)
o TRUST
o UNINCORPORATED
ASSOCIATION (BODY OF
INDIVIDUALS)
o REGISTERED SOCIETIES /
CLUBS / ASSOCIATIONS
Sr. No. NAME (%)
Name/s of the Beneficial Owner/s
with %
(The person/s exercise/s control
through ownership or has/have a
controlling ownership interest)*

*In case of company, “Controlling ownership interest” means ownership of/entitlement

to more than 25% of the shares or capital or profits of the company.
*In case of Partnership Firm, the beneficial owner is the natural person(s), who, whether
acting alone or together, or through one or more juridical person, has/have ownership
of/entitlement to more than 15% of capital or profits of the partnership.
*In case of unincorporated association or body of individuals the beneficial owner is the
natural person(s), who, whether acting alone or together, or through one or more
juridical person, has/have ownership of/entitlement to more than 15% of the property or
capital or profits of the unincorporated association or body of individuals.
*In case of trust, the identification of beneficial owner(s) shall include identification of
the author of the trust, the trustee, the beneficiaries with 15% or more interest in the
trust and any other natural person exercising ultimate effective control over the trust
through a chain of control or ownership.
Authorized Signatories
…………………………..…
…………………………….
(Please Note: Declaration about BO should be supported by document up to the
satisfaction of the Branch and / or certificate from Statutory Auditor of the Entity)

162
 Appendix V
(paragraph 15.1)
Form DA 1

Nomination under Section 45ZA of the Banking Regulation Act, 1949 and Rule 2(1) of
the Banking Companies (Nomination) Rules, 1985 in respect of Bank Deposits
I/We________________________________________________________________
__(names and addresses)
nominate the following person to whom in the event of my/our/minor's death the amount
of the deposit, particulars whereof are given below, may be returned by
.................................
(name and address of Branch/ office in which deposit is held)

Deposits Nominee
Nature Distinguishing Additional Name Address Relationship Age If nominee is
of No. details, if with a minor, his
any Depositor, if date of birth
any

£ 2 As the nominee is a minor on this date, I/We appoint

Shri/Smt./Kum.……..........................
.........................................................................................................................................
............(name, address and age)

to receive the amount of the deposit on behalf of the nominee in the event of
my/our/minor's death during the minority of the nominee.

Place :
Date : Signature(s)/Thumb impression(s) of depositor(s)

Name(s), signature(s) and

address(es) of witness(es) @

Where deposit is made in the name of a minor, the nomination should be signed by a
person lawfully entitled to act on behalf of the minor.

£ Strike out if nominee is not a minor.

@ Thumb impression(s) shall be attested by two witnesses.

163
 Appendix VI
(Paragraph 15.1)

FORM DA 2
Cancellation of Nomination under Section 45ZA of the Banking Regulation Act, 1949
and Rule 2(5) of the Banking Companies (Nomination) Rules, 1985 in respect of Bank
Deposits.

I/We________________________________________________________________
[name(s) and address (es)]

hereby cancel the nomination made by me/us in favor of…………………………………

.........................................................................................................................................
............ (Name and address) in respect of................................................................. (Give details
of deposit)

Place :

Date : * Signature(s)/Thumb
impression(s)of depositor(s)

Name(s), signature(s) and

address(es) of witness(es) £
------------------------------------------------------------------------------------------------------------------

* Where deposit is made in the name of a minor, the cancellation of nomination should
be signed by a person lawfully entitled to act on behalf of the minor.

£ Thumb impression(s) shall be attested by two witnesses.

164
 Appendix VII
(Paragraph 15.1)
FORM DA 3
Variation of Nomination under Section 45ZA of the Banking Regulation Act,
1949 and Rule 2 (6) of the Banking Companies (Nomination) Rules, 1985 in
respect of Bank Deposits.
I/We______________________________________________________________
[name(s) and address (es)]

cancel the nomination made by me/us in favor of .......................................................

(name and address)

and hereby nominate the following person to whom in the event of my/our/minor's
death the amount of the deposit, particulars whereof are given below, may be
returned by ............................................................................................................. (name
and address of Branch/office in which deposit is held)
Deposits Nominee
Nature Distinguishing Additional Name Address Relationship Age If nominee
of No. details, if any with Depositor, is a minor,
if any his date of
birth

£ As the nominee is a minor on this date, I/We appoint

Shri/Smt./Kum………………………................................................................................ (
name, address and age)to receive the amount of the deposit on behalf of the nominee in the

event of my/our/minor's death during the minority of the nominee.

Place :
Date : * Signature(s)/Thumb
Impression(s) of depositor(s)
Name(s), signature(s) and
Address (es) of witness (es)

* Where deposit is made in the name of a minor, the variation of nomination should be
signed by a person lawfully entitled to act on behalf of the minor.
£ Strike out if nominee is not a minor.
$ Thumb impression(s) shall be attested by two witnesses.
165
 Appendix VIII
(Paragraph 30.2, 30.3)
Specimen of an Unstamped Joint Hindu Family Letter to be obtained in Deposit
Accounts of Joint Hindu Families which are Non-Trading in nature

To,
Bank of India,
..................................... Branch.

Dear Sirs,

I the undersigned the present Karta or Managing Member and we the

undersigned are the present adult members of our Joint Hindu Undivided Family known
as "………………. .......................................... ............................................. H.U.F." We
are desirous of opening a Savings Bank/Double Benefit/Fixed Deposit Account
......................................................... in the name of.............................
".................................................................... H.U.F." with your
Bank.................................... Branch.

2. We hereby declare that we have read your current Rules relating to the account
and that we accept them as binding upon us.

3. Although the said account will be operated by me

………………………………………the Karta only, the following members namely:

1.

2.

3.

4.

5.

6.

are also authorised jointly and severally to represent and sign on behalf of the said joint
family and have full unrestricted authority to bind all the members of the joint family
however constituted from time to time.

4. In the event of the Bank acceding to our request and opening the account in the
166
name of............................................ H.U.F., we, the undersigned, undertake with the
intention of binding not only the present members of the said joint family (both adults
and minors) but also all future members thereof (both adults and minors) and all
persons entitled to a share therein and ourselves personally and our respective interest
in the joint family properties as well as our separate estates -

(1) that whenever any change occurs in the managership or in the constitution of
the said joint family caused by the death of a co-parcener whether or not resulting
in a share devolving on his widow or widows or by the birth of a co-parcener or if
at any time any of us desires to give up or sever his connection with the said Joint
Family or if any minor member of the said family attains majority, to give notice
thereof to the above-mentioned office of the Bank at once in writing;
(2)and that notwithstanding any change in the membership of the said Joint Family
all acts purporting to be done on behalf of the said Joint Family before the Bank
shall have received notice in manner aforesaid shall be binding on the said Joint
Family and its properties and on each of us and our respective estates and the
liability of the said Joint Family and of each of us and of our respective estates
shall continue until all liabilities in respect of such acts shall have been discharged.
The names and dates of birth of the present minor members of the aforesaid Joint
Family are given below*

Yours faithfully,

1. Mr…………………………………..
Will sign on behalf of the Hindu His personal signature here.
Undivided family as follow
……………………………………..
Karta

2. Mr…………………………………………..
……………………………………..

3. Mr………………………………………….
……………………………………..

4. Mr………………………………………….
………………………………………
*Particulars of the minor members of the joint Family:

Name Father’s name Date of

birth

…………………………… ………………

……………..
167
 Appendix IX
(Paragraph 39.4 & 41.2)

Specimen of a consent Letter for Mother to Operate Minor's Account

Date...........................

To,
Bank of India,
..................................... Branch.

Dear Sirs,

Re: Proposed Savings/Fixed/Short/ Monthly Income

Certificate/Double Benefit/Recurring Deposit Account in the name
of my minor son/daughter Master/Miss
….............................................
born on..............................

I do hereby give my consent to your opening Savings/Fixed/Short/Monthly

Income Certificate/Double Benefit/Recurring Deposit Account in the name of my minor
son/daughter Master/ Miss ...................................................................... to be operated
upon by my wife, Mrs ………….................................................................................. as
mother and natural guardian. All operations on the said account by my wife as such
natural guardian will be binding on me and on the above-named minor.

Yours faithfully,

(Signature of the minor's father)

168
 Appendix X
(Paragraph Nos 39.4 and 39.5)

Specimen of Indemnity to be signed by the Mother as a guardian of a

Mohammedan Minor where father is deceased

Date...........................

To,
Bank of India,
..................................... Branch.

Dear Sirs,

Re: Account in the name of ……………………………………. ...

minor to be operated upon by.................... mother/brother/sister/
grandmother/grandfather of the minor

At my request you have opened a Savings Bank Account

No..................................... / Fixed / Short / Monthly Income Certificate/Double Benefit
Deposit Account No......................../ Recurring Deposit Account No.
................................................... in the name of my minor son / daughter / brother /
sister / grandson / granddaughter to be operated upon by me as his/her mother/brother/
sister/grandfather/grandmother.
2. I have represented to you
* i) that my husband/father/son/son-in-law Mr. ..........................................................
the father of the said minor is not alive and I am acting as his/her defect guardian.

* ii) I am not in a position to obtain a letter of consent from my husband/father/son/son-

in-law Mr. ......................................................... the father of the said minor for
opening and operation of the said account.
iii) The account opened for the benefit of the minor and the money deposited
therein from time to time as also the interest accrued thereon from time to time
will be utilised for the benefit of the minor.

3. You have agreed to open the said account to be operated by me as the

guardian of the said minor without insisting on an order of a Court, relying on my
above representations and on my giving you an Indemnity as hereinafter appearing.

4. In consideration of the premises, I, so as to bind myself as the guardian of the

said minor as also in my personal capacity and my heirs, executors, administrators,
estate and effects, undertake and agree with you and your successors and assign as
follows :
169
* Delete if not applicable
i) to keep you safe and indemnified against all claims, demands, actions,
proceedings, losses, damages, costs, charges and expenses (the legal costs being
between Advocate and client) which may be made or brought or commenced
against you or be paid, sustained, suffered or incurred by you howsoever as a
consequence, direct or indirect of your opening the account in the name of the said
minor to be operated upon by me as his/her guardian as aforesaid and without
insisting on an Order of a Court;
ii) to pay to you on demand the amount of any such losses, damages, costs,
charges and expenses together with interest at ...................... % p.a. from the
date of payment by you until reimbursement by me.

Yours faithfully,

Witnesses : 1)

2)

Signatures & Addresses.

In consideration of the premises, we, the undersigned,

................................................................ (name/s of surety/ies) jointly and
severally guarantee to you, Bank of India, the payment of all moneys due under
the aforesaid indemnity by the executants thereof.

Witnesses : 1) Signature ..........................................................................

Name .................................................................................
Occupation .......................................................................
Address ............................................................................

2) Signature ..........................................................................
Name ................................................................................
Occupation .......................................................................
Address .............................................................................

Signatures and Addresses

Note : To be stamped as an Indemnity Bond if the signature of any of the

executants whether indemnifier or surety is attested by a witness. If not so
attested, it is to be stamped as an Agreement. But the indemnifier and the sureties
should be otherwise properly identified.
170
 APPENDIX XI
(Paragraph no. 39.4 and 39.5)

Specimen of the Consent Letter to be obtained from the Father to allow Relatives to
operate the Account

To,
Bank of India, Date : ..........................
............................. Branch

Dear Sirs,

Re : Proposed Savings/Fixed/Short/Monthly Income Certificate/Double

Benefit/Recurring Deposit Account in the name of my minor son/
daughter Master/Miss ......................................................................
born on .............................................................................................

I do hereby give my consent to your opening Savings/Fixed/Short/Monthly

Income Certificate/Double Benefit/Recurring Deposit Account in the name of my minor
son/daughter, Master/Miss................................................................................... to be
operated upon by
my*…………………Mr./Mrs.................................................................................. as**
.................. ................................................and guardian of my minor daughter / son. All
operations on the said account by my*........................................... as**
............................................................. and guardian of the minor would be binding on
me and
on the abovementioned minor.
Yours faithfully,

.......................................................
(Signature of the minor's father)

* State the relationship of father to the relatives

* * State the relationship of the relatives to the minor.

171
 APPENDIX XII
(paragraph 39.4 to 39.8 and 41.3)
Specimen of a Letter of Undertaking by Father and Mother to Operate Minor's
Account by Either of Them

Date. ........................

To,
Bank of India,
.................................... Branch.

Dear Sirs,

Re: Proposed Savings/Fixed/Short/Monthly Income Certificate/Double

Benefit/Recurring Deposit Account in the name of my minor son/
daughter Master/Miss ......................................................................
born on .........................................

I do hereby give my consent to your opening Savings / Fixed / Short / Monthly Income
Certificate/Double Benefit/Recurring Deposit Account in the name of my minor son /
daughter Master / Miss......................................... to be operated upon by either myself
as the father and natural guardian or my wife,
Mrs............................................................... as mother and natural guardian. All
operations on the said account by my wife as such natural guardian will be binding on
me and the above-named minor.

Yours faithfully,

(Signature of the minor's father)

I agree and undertake that I will operate the account as stated above, for the benefit
of my minor son/daughter.

(Signature of the minor's mother).

172
 APPENDIX XIII
(Paragraph 45.3)

Specimen of Declaration by Parents where Both the Parents are alive

To, Date..........................

Bank of India,
......................................... Branch

Dear Sirs,

Re: Opening of an account with your ................................................Branch on

behalf of our minor son/daughter

We say that we are desirous of opening an account with your

...................................... Branch in the name of our minor son/daughter
................................................................. who is under the age of 18 years (hereinafter
referred to as "the minor").

2. We understand, you require school certificate/birth certificate from

Municipality/birth certificate from Gram Panchayat as proof of date of birth for opening
an account on behalf of the minor.

3. Since we do not possess school certificate/birth certificate from Municipality/birth

certificate from Gram Panchayat as proof of date of birth required by you, we request
you to open the account in the name of our minor son/daughter on the basis of this
declaration made by us.

4. We have made due and diligent search to obtain school certificate/birth

certificate from Municipality/birth certificate from Gram Panchayat but could not find the
same and we hereby undertake to furnish it if we obtain the same from aforesaid
authority.

5. We say that we are parents of our minor and we are entitled to operate an
account on behalf of our minor under the personal law by which we are governed.

6. We hereby undertake to indemnify and keep indemnified you against any loss or
damage that may be caused to or suffered by you on account of any claim that may be
made in respect of the said account opened by us on behalf of minor.

173
7. We have made this declaration solemnly and sincerely knowing that on the faith,
strength and correctness thereof you have agreed to open the said account on behalf
of minor.

Yours faithfully,
( ............................................... )

174
 APPENDIX XIV
(paragraph 45.3)

Specimen of Declaration by the Surviving Parent where one of the Parents is

Deceased

To, Date..............................

Bank of India,
................................... Branch

Dear Sirs,

Re : Opening an account with your .................................. Branch

on behalf of my minor son/daughter.

I say that I am desirous of opening an account with your

............................................... Branch in the name of my minor son / daughter
.................................................................................. who is under the age of 18 years
(hereinafter referred to as "the minor").

2. I understand, you require school certificate/birth certificate from

Municipality/Gram-Panchayat as proof of date of birth for opening an account on behalf
of the minor.

3. Since I do not possess school certificate/birth certificate from Municipality/Gram-

Panchayat as proof of date of birth required by you I request you to open the account
in the name of my minor son/daughter on the basis of this declaration made by me.

4. I have made due and diligent search to obtain school certificate/birth certificate
from Municipality/Gram Panchayat but could not find the same and I hereby undertake
to furnish it if I obtain the same from aforesaid authority.

5. I say that I am the only surviving parent of my minor son/daughter and I am

entitled to operate an account on behalf of minor under the Personal Law by which I am
governed.

6. I hereby undertake to indemnify and keep indemnified you against any loss or
damage that may be caused to or suffered by you on account of any claim that may be
made in respect of the said account opened by me on behalf of the said minor.

7. I have made this declaration solemnly and sincerely knowing that on the faith,
strength and correctness thereof you have agreed to open the said account on behalf
175
of the said minor.

Yours faithfully,

..........................................

176
 APPENDIX XV
(Paragraph 49 B)
DRAFT RESOLUTION
CERTIFIED copy of a Resolution passed by the Board of Directors
of.......................................
Co. Ltd. at its meeting held on the ................... day of.............. 20.......... when a
proper quorum was present

RESOLVED that Mr .......................................................................................................

Chairman/Managing Director/Chief Executive/
......................................................................of the Company be and is hereby
authorised for and on behalf of and in the name of the Company to open and operate
on any Current Accounts whether the same be in credit or overdrawn and other demand
or term deposit accounts with any Bank or Banks at any place or places in India/in the
State of................................. he may approve of and for that purpose to sign the
necessary account opening forms and mandates, receipts and other documents
required by the concerned Bank and to give to such Banks instructions from time to
time regarding operation of such accounts whether the same be in credit or overdrawn
including the names of any officers/employees authorised by him to operate such
accounts and the mode of operation thereof and to vary or revoke these instructions
and to issue new instructions to the Banks at his discretion from time to time and to
close any of such accounts if he so thinks fit.

RESOLVED further that the said Mr. ................................. be and he is hereby also
authorised to make, draw, accept, endorse, transfer, negotiate, deal with any cheques,
pay-orders/bills of exchange and other negotiable instruments/ for and on behalf and in
the name of the Company and also to sign and to give discharges and receipts for any
moneys payable to the Company by any Bank in respect of any such Bank account and
generally to do all such acts, deeds and things as may be necessary and proper for the
purpose of opening and operating such account or any of them including in particular
to authorise any officer or employee of the Company to operate such accounts and to
exercise any of the powers hereby conferred on him except the power to open any such
accounts.

FURTHER RESOLVED that Mr. .................................................... Chairman/Managing

Director/Chief Executive is hereby authorised to delegate the powers hereunder given
to him to such other officers as he may deem fit from time to time on such terms and
conditions as he may deem fit

RESOLVED that as and when required a certified copy of this Board Resolution be
furnished to the concerned Bank and the Bank be requested to act thereon.

177
 APPENDIX XVI
(paragraph 49 (d) and 58 (d))

Specimen of Resolution for Opening of Accounts of Limited Companies AND

Societies, Associations, Committees and Clubs Incorporated
under the Companies Act, 1956

Certified copy of an extract from the minutes of meeting of the Board of Directors
of the ............................... Company Limited duly convened and at which a proper
quorum was present, held at ...................................................... on the ........... day of
......................20…….

We hereby certify that the following resolution of the Board of Directors

of.......................... ................................ Co. Ltd., was passed at a meeting of the Board
held on ................................. and has been duly recorded in the minute book of the said
Company:

"Resolved that a banking account for the Company be opened with Bank of India,
......................... Branch, .................... City and that the said Bank be and is hereby
authorised to honour cheques, bills of exchange and promissory notes drawn, accepted
or made on behalf of the Company by
………………………………………………………(Here insert how many persons have to
sign and their names)...................................................................................and to act
upon any instructions so given relating to the account, whether the same be overdrawn
or not or relating to the transactions of the Company."

..........................................
Certified true copy Chairman of the Meeting
Date .............................

……..………………………………
Secretary
(Names and designations of the office-bearers should be mentioned)

(b) That as and when any change takes place in the Governing Body/Managing
Committee/Board of Management / ..........................................................................
the Bank be advised about such change and a fresh Resolution regarding the
operation of the Account(s) be forwarded to the Bank forthwith.

(c) That a copy of the Resolution duly authenticated by

………………………………………………………….names and designations)be forwarded to
178
the Bank together with the specimen signatures of all the aforesaid office- bearers.
This Resolutions shall remain in force until the receipt by the Bank of the advice
about the change in the office-bearers authorised to operate the Account(s) together
with a fresh Resolution in that behalf."

.............................................
Chairman of the Meeting
Certified True Copy
Date........................ Secretary

* Applicable alternative(s) to be included in the Resolution

179
 APPENDIX XVII
[Paragraph 58 (d)]

Specimen of Resolution for Opening of Accounts of Clubs, Schools,

Societies,Associations, Committees, etc.

Certified copy of an extract from the minutes of a meeting of the Governing

Body/Managing Committee/Board of Management of
.............................................................................. duly convened at which a proper
quorum was present, held at ............................................... on the ..............day of
............................ 20..............

"RESOLVED
*(a) That a Current/Savings Bank Account(s) be opened in the name
of.............................. ………………………………………………..with Bank of India,
.............................................. Branch, ...................................... City and that the
account(s) be operated upon and cheques thereon be signed and all instructions
regarding the Account(s) be given by all/any .................................. of the following
office-bearers:
.....................................................................................................
.....................................................................................................
.....................................................................................................
(Names and designation of the office-bearers should be mentioned)
AND/OR

*(a) That a Safe Custody Account be opened in the name of

................................................. with Bank of India, ........................................
Branch,........................................ City, and that all / any ...................................... of the
following office-bearers be authorised to lodge into and withdraw from the Account the
Shares, Debentures, Securities, Fixed Deposit Receipts and any other scrip
representing any investment whatsoever belonging to ................................................
and to give instructions to the Bank for selling and otherwise dealing with all or any of
them and also to give all other instructions with regard to operation
of the said Safe Custody Account:

.....................................................................................................
.....................................................................................................
.....................................................................................................
(Names and designations of the office-bearers should be mentioned)
AND/OR

*(a) That a Fixed Deposit Account/Monthly Income Certificate/Double Benefit Deposit

Account be opened in the name of ..................................................................................
with Bank of India, ......................................... Branch, .......................................... City,
180
by depositing an amount of Rs.............................. (Rupees
…………………………………………..) for a period of ............................... years and/or
by depositing such other amounts as may be available for such period(s) as may be
required from time to time and that all/any ................. of the following office-bearers be
authorised to receive the amount of the said Fixed Deposit/ Monthly Income
Certificate/Double Benefit Deposit and interest thereon and to renew the same and to
endorse and discharge the Fixed Deposit Receipt(s)/Monthly Income
Certificate(s)/Double Benefit Deposit Certificate(s) and to give all other instructions with
regard to the operation of the said Fixed Deposit/Monthly Income Certificate/Double
Benefit Deposit Account:
...................................................................................................................

181
 APPENDIX XVIII
(Paragraph 67 d)

Specimen of Resolution for Trust Accounts: Current or Savings Bank Account

Resolution passed by the Trustees of the ............................................................

Trust at their meeting held on the ............................. day of ........................... 20

Resolved that:

(a) A Current/Savings Bank Account be opened in the name of

............................................... Trust with Bank of lndia, .........................................
Branch, ....................................... City.

(c) The Account be operated upon and cheques thereon be signed and all instructions
regarding Account be given by all/any ……………………………………………………
………...……………………………………………………………………………………
…(Insert the no. as authorised by the Trust Document or permitted by Head Office)
Of following Trustees, who are all the present Trustees of the abovementioned
Trust:
.........................................................................................
.........................................................................................
.........................................................................................
.........................................................................................

(c) As and when any change takes place in the Board of Trustees, the Bank be advised
about such change and a fresh Resolution regarding the operation of the Account be
forwarded to the Bank forthwith.

(d) This Resolution be forwarded to the Bank together with the specimen signatures of
all the Trustees and it shall remain in force until the receipt by the Bank of the advice
about the change in the Board of Trustees together with a fresh Resolution referred to
in (c) above.

............................................................
............................................................
............................................................
............................................................
(All the Trustees to sign).

182
 APPENDIX XIX
[paragraph 67(d)]

Specimen of Resolution for Trust Accounts: Safe Custody Account

Resolution passed by the Trustees of the ................................................ Trust at their

meeting held on the ................................. day of ............................ 20...............

Resolved that :

(a) A Safe Custody Account be opened in the name of the .......................................................

Trust with Bank of India, .................................................. Branch, ....................................
City.

(b)All/Any………………………………………………………………………………......................
...(Insert the number as authorised by the Trust Document or permitted by Head Office)of the Trustees named below, who
are all the present Trustees of the Trust, be authorised to lodge into and withdraw from the
Account the shares, securities and other investments belonging to the Trust and to give
instructions to the Bank for selling and otherwise dealing with the same and also to give all
other instructions with regard to the operation of the said Safe Custody Account:

...................................................................
...................................................................
...................................................................
...................................................................

(c) As and when any change takes place in the Board of Trustees, the Bank be advised about
such change and a fresh Resolution regarding the operation of the Account be passed and
forwarded to the Bank forthwith.

(d) This Resolution be forwarded to the Bank together with the specimen signatures of all the
Trustees and it shall remain in force until the receipt by the Bank of the advice about the
change in the Board of Trustees together with a fresh Resolution referred to in (c) above.

........................................................

........................................................

........................................................
(All the Trustees to sign).

183
 APPENDIX XX
[Paragraph 67(d)]

Specimen of Resolution for Trust Accounts: Term Deposit Account

Resolution passed by the Trustees of the............................................... Trust at

their meeting held on the ................................. day of ..................... 20...............
Resolved that:

(a) A fixed Deposit / Monthly Income Certificate / Double Benefit Deposit Account be
opened in the name of the ………………………. Trust with Bank of
India……………………………….
Branch,……………………………City, by placing an amount of Rs………………………
on Fixed Deposit / Monthly Income Certificate / Double Benefit Deposit for a period of
………… years.

(b)All/Any.........................................................................................................................
......(Insert the number as authorised by the Trust Document or permitted by Head Office)of the Trustees named
below, who are all the present Trustees of the Trust, be authorised to receive the
amount of the said Fixed Deposit/Monthly Income Certificate/Double Benefit Deposit
and interest thereon or to renew the same and to endorse and discharge the Fixed
Deposit Receipt(s)/Monthly Income Certificate(s)/Double Benefit Deposit Certificate(s)
and to give all other instructions with regard to the operation of the said Fixed
Deposit/Monthly Income Certificate/Double Benefit Deposit Account :

...................................................................
...................................................................

(c) As and when any change takes place in the Board of Trustees, the Bank be advised
about such change and a fresh Resolution regarding the operation of the Account be
passed and forwarded to the Bank forthwith.

(d) This Resolution be forwarded to the Bank together with the specimen signatures of
all the Trustees and it shall remain in force until the receipt by the Bank of the advice
about the change in the Board of Trustees together with a fresh Resolution referred
to in (c) above.

........................................................
(All the Trustees to sign).

184
 APPENDIX XXI
(Paragraph 69)

To be stamped
as an agreement

Specimen of Indemnity Letter by Trustees in a Trust Account

Date ........................

To,

Bank of India,
................................ Branch.

Dear Sirs,

In consideration of your having at our request opened a Current/Savings Bank

Account with you in the name of
........................................................................................ to be operated upon by any
......................................... of us jointly, we do jointly and each one of us doth severally
declare, undertake and agree as follows:

(1) That we all have been duly appointed Trustees and are entitled to act as such
Trustees of the said Trust.

(2) That all deposits into and withdrawals from the said account shall be in due course
of the administration of the said Trust and for the purpose of the Trust and that the
account shall relate solely to the affairs of the Trust and that you are not to be concerned
to look to the propriety of any withdrawal or to the actual application thereof and that
every withdrawal shall
for the purposes of these presents be deemed to be a withdrawal by us all.

(3) That you will be duly notified of any and every change in Trustees.

(4) That we and each one of us jointly and severally so as to bind our respective selves
personally and our respective heirs, executors and administrators and our personal
estates and effects will keep Bank of India, its Successors and Assigns safe, saved,
harmless and indemnified against all proceedings, actions, claims, demands, losses,
damages, costs, charges and expenses (the legal costs being as between advocate
and client) commenced or made against the Bank or paid, sustained, suffered or
185
incurred by the Bank in consequence of any operation on the said account on any
ground whatsoever, to the intent that the Bank shall in all respects be in the same
position in which it would be if the account were an ordinary current account without the
Bank being affected with notice of the Trust.

Yours faithfully,

............................................................

(All the Trustees to sign)

186
 APPENDIX XXII
(Paragraph 85)

Specimen of a letter of Thanks to the Introducer of an Account

Ref. No. Date ............................

..............................................................
..............................................................
..............................................................

Dear Sir/Madam,

It is always gratifying when a customer of Bank of India recommends its

services to a friend and introduces him to the Bank. It is, therefore, with much
pleasure that we have opened a current/savings bank account for Mr./Mrs./Miss
..................................................... who has been introduced to us by you.

I very much appreciate this introduction from you because, besides indicating
to us the worthiness of the new customer, it expresses the friendly relations existing
between the Bank and its old customers.

In sending you this note of personal thanks, I would take the opportunity to
advise you that, besides current / savings accounts, the Bank offers to its
customers extensive
services of various kinds.

Yours faithfully,

Manager

187
 APPENDIX XXIII
(paragraph 119.1(i), 119.2(a))

Specimen of Form to be Completed by Claimant(s) for Payment of Balance of

Account
of a Deceased Account Holder
Date .....................
To,

Bank of India,
.................................. Branch.

Dear Sirs,

(Specify type of deposit and title of account)

Re: ......................................................................................................

I/We furnish the following particulars in connection with the above account and
request you to repay the balance of the account against an Indemnity Bond:
1. Name of the deceased account
holder..............................................................................

2. Name(s) of the
applicant(s)………………………………………………………………………………………

3. Amount claimed and the nature of the account

concerned………………………………………………

4. Has the deceased left a Will? Who are the executors named in such Will? Why has
Probate not been obtained?
.........................................................................................................................................

5. If the deceased did not leave a Will, has any form of legal representation been
obtained to his estate such as Succession Certificate, Letters of Administration or an
Administrator General's Certificate? If so, by whom?
……………………………………………………………………………………………………

6. If the deceased was married, did he/she leave a widow/widower and/or a child or
children or a child or children of a predeceased child? Any minors? If so, is there a legal
or natural guardian?
……………………………………………………………………………………………………
7. If the deceased did not leave a widow/widower and a child or children or issue, did
he/ she leave him/her surviving any parent, brother, sister or children of a predeceased
brother or sister?
188
……………………………………………………………………………………………………
8. What is the relationship of the claimants with the deceased? Are they all the heirs?
……………………………………………………………………………………………………

9. If the deceased was a Hindu and the balance of the account is claimed as joint family
property, who are the other members of such joint family? Who is the Karta of such joint
family?
……………………………………………………………………………………………………
10. Are there any claimants/heirs other than those joining in the indemnity bond?
……………………………………………………………………………………………………
11.Are there any unsatisfied creditors?
……………………………………………………………………………………………………
12. What is the position regarding liability to and payment of estate duty?
……………………………………………………………………………………………………
13. Has the deceased left any other assets? If so, who is/are the claimant(s) thereto?
How has/have such claimant(s) acquired title to such assets?
……………………………………………………………………………………………………
14. Was the deceased doing any business or was he in service? If in service, was he
entitled to any Provident Fund? If he was, whom did he nominate to receive such
Provident Fund?
……………………………………………………………………………………………………
15. Was the life of the deceased assured? If so, to whom have the moneys been paid?
Was there a nomination or assignment in respect of the assurance moneys? If so, to
whom?
……………………………………………………………………………………………………
16. Names of two sureties, with full address and occupation.

……………………………………………………………………………………………………
I. (i) Name
(ii) Address
(iii) Occupation

II. (i) Name

(ii) Address
(iii) Occupation

17. Any other facts which the applicant(s) wants to state in support of his/their claim.
Yours faithfully,
...............................................

189
APPENDIX XXIV (Paragraph 134.7(vii))

190
191
192
 APPENDIX XXV

(Paragraph 127A(vi))

193
APPENDIX XXVI (Paragraph
134.4(vi), 134.7(vi))

194
195
 APPENDIX XXVII
(Paragraph 127A(i), 134.7(i))

196
197
198
199
 APPENDIX
XXVIII(Paragraph 119(iv), 127A(ii), 134.7(ii))

200
201
202
203
APPENDIX XXIX(Paragraph 127, 134)

204
APPENDIX XXX (Paragraph 127, 134)

205
APPENDIX XXXI(Paragraph 127A(iii))

206
APPENDIX XXXII (Paragraph 134.7(iii))

207
208
209
APPENDIX XXXIII (Paragraph 126)

210
211
 APPENDIX XXXIV
(Paragraph 127, 134)

212
213
 APPENDIX XXXV
(Paragraph 127, 134)

214
 APPENDIX XXXVI
(Paragraph 127, 134)

215
APPENDIX XXXVII
(Paragraph 127A(iv), 134.7(iv))

216
APPENDIX XXXVIII (Paragraph 127A(v), 134.7(v))

217
APPENDIX XXXIX(Paragraph 127, 134)

218
 APPENDIX XXXX
(paragraph 149.1)
Specimen of Declaration Form -Staff Accounts

Date ...............................

To,

Bank of India,
..................................... Branch.

Dear Sirs,

Re: My Savings Bank Account No. ...............................................

My Term Deposit (F.D./M.I.C/D.B.D.)/R.D.*
Account

I do hereby declare that I am a staff member of the Bank of India,

............................... Branch/Department and the monies deposited or to be deposited
in my abovementioned account(s) are my own monies and belong to me.

Yours faithfully,

……………………………

* Strike out which is not applicable.

219
 Appendix XXXXI
(Paragraph 148.1)

Specimen of Statement of Current Accounts Opened/Maintained in the Names

of close Relatives of Staff Members

BRANCH : FOR THE QUARTER ENDED

Name(s) of
Proprietor/Pa Remarks on
rtners/ conduct of
Directors and Account such as
particulars of Mimimum &
Name of Account
Account staff Member Maximum
the introduced Activity Constitution
opened on who is close balance, cheques
Account by
relative of the returned unpaid of
Proprietor/Pa any and reason
rtner/Director therefore overlimit
& nature of granted any etc.
relationship

220
APPENDIX XXXXII
(Paragraph 167.1(4))

221
222
223
224
225
 APPENDIX XXXXIII
(Paragraph 167.2(1))

226
227
228
229
230
231
232
233
 APPENDIX XXXXIV
(Paragraph 167)
Bank of India ...................... Branch

Statement of Transactions for the month of .................. 20 ................

(Rules, 114B, 114C & 114D of Income Tax Rules)
Date Name & Address of the Nature of Amount PAN/GI PAN/GIR No. not quoted
No. Depositors/Others Transaction Rs R Whether enclosed copies of
No.

Form 60 Form 61
Yes/No Yes/No Passport
Yes/No.

I Term Deposits
exceeding
Rs. 50,000/-
II Opening of Accounts

III Payment to a hotel/

restaurant of bills
exceeding
Rs. 25,000/-at any one
time

IV Others (Specify)

Date :

Branch Manager

234
 APPENDIX XXXXV
(Paragraph 146. A)

Customer Records Up-dation Sheet

Title of A/C :- _______________________________________________________________

A/C No :-

Branch :- _______________________________________________________________
My / Our Account Personal details are as under :-
Account Holder 1 Account Holder 2 Account Holder 3

Name:

Date of Birth:

Gender:

Marital Status:

PAN No.

Occupation:

My / Our Present Contact Details/Addresses are as under:-

Residence: Office:

Land Mark Land Mark

Pincode Pincode

Phone (R) Phone (O)

Mobile No.____________________________ Mobile No.________________________

Email : _______________________________ Email : ___________________________

Preferred Communication Address :- Residence / Office .(Please tick your preference for communication address).

I/ We confirm that above will be the communication address for all correspondences relating to my / our
above mentioned bank account. I / We authourise you to update your records as per above information.

Signature 1 Signature 2 Signature 3

I am currently enjoying following products from the bank, please link them to a common customer id -

□ Savings Bank A/c □ Current A/c □ Term Deposit □ PPF A/c □ Personal Loan

A/c No: A/c No: A/c No: A/c No: A/c No:

Branch: Branch: Branch: Branch: Branch

□ Home Loan □ Auto Loan □ Mortgage Loan □ Education Loan □ Other

A/c No: A/c No: A/c No: A/c No:

Branch Branch Branch Branch

I am interested in -

□ Savings Bk A/c □ Current A/c □ Term Deposit □ ATM/Debit/Credit Card

□ Education Loan □ Home Loan □ Auto Loan □ Safe Deposit Vaults

□ Internet Banking □ E-Pay □ Online Share Trading

I would like to refer the following friends / relatives to the Bank for banking services

Name: Phone No: Product:

Name: Phone No: Product:

Name: Phone No: Product:

235
APPENDIX XXXXVI (Paragraph 166.1)

236
237
238
239
240
APPENDIX XXXXVII
(Paragraph 166.1)

241
242
243
244
245
246
247
248
APPENDIX XXXXVIII, LIX
(Paragraph 166.1)

249
 APPENDIX L
(Paragraph 166.1)

250
 APPENDIX LI
(Paragraph 166.1)

251
252
 APPENDIX LII
TD549 – MOTOR ACCIDENT CLAIMS TERM DEPOSIT

Sr. Scheme Particulars / Details

No. Features
1 Purpose One time lump sum amount, as decided by the Court /
Tribunal, deposited to receive the same in Equated
Monthly Installments (EMIs), comprising a part of the
principal amount as well as interest.
2 Eligibility Individuals including Minors through guardian in single
name.
3 Mode of Singly
Holding
4 Type of Motor Accident Claims Annuity (Term) Deposit Account
account (MACAD)
5 Deposit i. Maximum: No Limit
Amount ii. Minimum: Based on minimum monthly annuity Rs.
1,000/- for the relevant period.
6 Tenure i. 36 to 120 months
ii. In case the period is less than 36 months, normal FD
will be opened.
iii. MACAD for longer period (more than 120 months)
will be booked as per direction of the Court.
7 Rate of Prevailing rate of interest as per Tenure.
interest
8 Receipts/ i. No Receipts will be issued to depositors.
Advices ii.Passbook will be issued for MACAD.
9 Loan No loan or advance shall be allowed.
Facility
10 Nominatio i. Available.
n facility ii. MACAD shall be duly nominated as directed by
the court.
11 Premature i. Premature closure or part lump sum payment of
Payment MACAD during the life of the claimant will be made
with permission of the court. However, if permitted,
the annuity part will be reissued for balance tenure
and amount, if any, with change in annuity amount.

253
 ii. Premature closure penalty will not be charged.
iii. In case of death of the claimant, payment to be given
to the nominee. The nominee has an option to
continue with the annuity or seek pre-closure.
12 Tax i. Interest payment is subject to TDS as per Income Tax
deduction Rules. Form 15G/15H can be submitted by the
at source Depositor to get exemption from Tax deduction.
ii. The annuity amount on monthly basis net of TDS will be
credited to the MACT Savings Bank account.

254
 Appendix LIII
SB170 – MACT CLAIMS SB ACCOUNT

Sr Features Particulars / Details

No
1 Eligibility Individuals including Minors (through guardian) in
single name.
2 Minimum/ Not applicable
Maximum Balance
Requirement
3 Cheque book / i. By default, these facilities are not available in
Debit Card / ATM this product.
Card/ Welcome Kit/ ii. However, in case these facilities have already
Internet Baking /
been issued, the court shall direct the bank to
Mobile Banking
facility cancel the same before the disbursement of the
award amount.
iii. The bank shall make an endorsement on the
passbook of the claimant(s) to the effect that no
cheque book and/or debit card have been
issued and shall not be issued without the
permission of the Court.
4 Operations in i. Only single operation.
the account ii. In case of Minor accounts, the operation will be
through guardian.
5 Withdrawals Only through Withdrawal Forms or through Bio-
Metric authentication.
6 Product change Not permitted

7 Place of Opening Only at the Branch near to the place of residence of

Claimant (as directed by the Court).
8 Account Transfer Not allowed

9 Nomination Available, as per Court Order.

10 Passbook Available

11 Rate of Interest As applicable to Regular SB accounts

12 Statement by e- Available
mail

255
Appendix LIV

Process flow of the Account MACAD

Customer (Claimant) visits the Branch along with High Court Order for
opening the MACT SB A/c & MACAD A/c with Bank

Branch Official after verifying the facts, provide an Account Opening Form
for filling all the details and advise him to produce the required documents
for KYC and other details along with the photographs.

After examining the KYC documents, the Account will be opened and the
Nomination will be entered as per Court Order. The details of the Account
will be advised to the Customer for onward submission to the Court.

The amount received in MACT SB A/c. shall be deposited in the MACAD

account as per directions by the Court.

The Customer shall be given passbook for the A/c opened in his name.

The premature closure of MACAD deposit by the claimant will be

allowed as per the Court order only. In case of part withdrawal of
MACAD deposit (as allowed by the Court) the Customer shall be
advised about revised Annuity amount, if any, after effecting part
withdrawal of the deposit.

In case of death of the Claimant, payment will be given to the

Nominee as per the Extant guidelines on Nomination.
256
 CHAPTER 3-CURRENT ACCOUNT
Introduction

1. Current Accounts are opened mainly by business community, corporate bodies or

the like where the account holder has often to receive money and to make a number
of payments. Current accounts are maintained mainly for business purposes and are
never used for the purpose of investment or saving. These deposits are the most liquid
deposits and there are no limits for number of transactions or the amount of
transactions in a day. Considering the large number of transactions in the account
and volatile nature of balances maintained, banks generally levy certain service
charges for operating a Current account.

2. RBI defines current account as a form of non-interest bearing demand deposit

where from withdrawals are allowed any number of times depending upon the balance
in the account or up to a particular agreed amount and shall also be deemed to
include other deposit accounts which are neither Savings Deposit nor Term Deposit.
In terms of RBI directives, banks are not allowed to pay any interest on the balances
maintained in Current Accounts. However, legal heirs of a deceased person are paid
interest at the rates applicable to Savings bank deposit from the date of death of the
account holder till the date of settlement.

3. Current accounts may be opened in the names of:

 Individual - Single Accounts

 Two or more individuals - Joint accounts (Can be opened with operational
 instructions "Either or Survivor" or Former or Survivor" or "Any One/All of
the Joint Account Holders")
 Sole Proprietary concerns
 Partnership Firms
 Joint Hindu Families or Firms
 Associations, Clubs, Societies etc.
 Limited Companies
 Executors and Administrators
 Trusts
 Provident Funds
 Liquidators
 Other Banks
 State Financial Corporations
 Government departments/organisations etc
Note: In approved cases, branches may open non-operating accounts called
"Collection Accounts".
Opening of Accounts
257
4.1 To fall in line with the RBI’s guidelines on Know Your Customer (KYC) policy the
account opening form has been modified. The Branches are required to obtain the
revised account opening form while opening Savings Bank, Current Account, all types
of term deposits, BOI Savings Plus, BOI Current Plus, Overdraft and Cash Credit
account. Also refer to the Current A/c rules as per the SOP.

A new form is to be obtained at the time of opening of accounts for new customers
and for opening an additional account in an existing account title, only additional
account opening form is to be obtained. For example, if A and B have earlier opened
a Savings Bank Deposit Account where this new form has been obtained, incase they
desire to open a Term deposit account, the additional form need only be obtained.
The new account opening form should be obtained in all existing accounts also in a
phased manner.
A separate specimen signature slip (form CD 63S) and Bill Indemnity Letter (Form
Bills 1005) should also be signed by all the account holders irrespective of the mode
of operations on the account. The nomination in the prescribed format should be
obtained in all personal accounts/sole proprietary accounts where such nomination is
desired by the account holders. (Refer Chapter 2 on Deposits - General).

Please also refer to our Bank’s Deposit Policy and the amendments/ changes/ revision
from time to time.

Please also follow KYC and AML guidelines/norms/policy and Central KYC
registry guidelines along with CKYC operational Guidelines.

Branches are also advised to visit Stardesk e-daftary for downloading the New
Account Opening Form (Chapter 2 Deposit General- Appendix I) and one pager
Application Form required in CKYC Process (Chapter 2 Deposit General-
Appendix II).

4.2 KYC DOCUMENTS FOR VARIOUS TYPES OF ACCOUNTS

Kindly note importantly that

(i) Copies of KYC documents to be obtained duly signed by the applicant and
verified with the original however in case of digitally opened accounts where KYC
documents have been digitally verified, there is no need to obtain physical copy of
the documents.

(ii) Wherever the proof given has BOTH the Identity as well as current address in a
SINGLE DOCUMENT, branch may obtain only that SINGLE document as identity
and address proof.

258
 KYC DOCUMENTS FOR VARIOUS TYPES OF ACCOUNTS:

Particulars
1. (a) For customers who are natural persons, the branches shall do Basic Due Diligence by obtaining sufficient
identification vide self-attested copy of one of the SIX OVDs, verified by original to ascertain
(i) identity and address of the customer
(ii)one recent photograph,
(iii) Any other document pertaining to business or financial status i.e. B/S, income tax return etc.
(b) For customers as legal persons or entities, branches shall obtain / verify through documents, as under-
(i) the legal status of the entity,
(ii)any person purporting to act on behalf of the legal person/entity is so authorized and verify the identity of that
person through OVDs,
(iii) Understand the ownership and control structure of the customer and determine, who is / are the natural
person / s who ultimately controls the legal person/entity – as per definition of Beneficial Owner( REFER CHAPTER
2,Annexure I)
As a proof of identity and address, at least one of the following documents (OVDs) is obtained for verification
along with a copy in respect of Individual, Proprietor, each Joint account holder / each Partner / each Director / each
Trustee / each HUF Member, each Office Bearer, each Authorized signatory/PA holder(Refer CHAPTER 2,POINT
23.2A-1):-
1. Passport [within validity period];
2. Letter issued by the National population Register containing details of name and address
3. Voter’s Identity Card;
4. Driving License [within validity period];
5. Job Card issued by NREGA signed by an officer of the State Govt;
6. Aadhaar Card
2. Proprietorship Firm account, the following documents are obtained in addition to documents listed above at Sr. No.
1( Refer CHAPTER 2,POINT 23.2A-2):-
a. Proprietorship letter in Banks’ format;
b. Power of attorney, if any granted by the Proprietor;
C. Additionally, in Proprietorship Firm account, ANY TWO of the following documents must be obtained and
the same will be deemed as OVD
(a) Registration certificate 17
(b) Certificate/license issued by the municipal authorities under Shop and Establishment Act.
(c) Sales and income tax returns (GST Registration Number/Income tax returns).
(d) Certificate/registration document issued by Professional Tax authorities.
(e) License/certificate of practice issued in the name of the proprietary concern by any professional body
incorporated under a statute.
(f) Complete Income Tax Return (not just the acknowledgement) in the name of the sole proprietor where the firm's
income is reflected, duly authenticated/acknowledged by the Income Tax authorities.
(g) Utility bills such as electricity, water, and landline telephone bills.
(h) IEC (Importer Exporter Code) issued to the proprietary concern by the office of DGFT / License/certificate of
practice issued in the name of the proprietary concern by any professional body incorporated under a statute.
NOTE:-
- In cases where it is not possible to obtain two of the documents listed at C.(a) to (h) above, and the branches are
satisfied with the explanation given by the customer, the Branches would have the discretion to accept only one of
those documents as business activity proof.
- However, in such cases the branches would have to undertake contact point verification, collect such information as
would be required to establish the existence of such firm, confirm, clarify and satisfy themselves that the business
activity is being undertaken from the given address of the proprietary concern.
- The account opening official must document such confirmation in the account opening form. It is also clarified by RBI
that the list of registering authorities indicated is only illustrative and therefore includes license / certificate of practice
issued in the name of the proprietary concern by any professional body incorporated under a statute, as one of
the documents to prove the activity of the proprietary concern.
The above mentioned documents {except No. (f) } should be in the name of the proprietary concern. In
respect of all existing sole proprietary accounts, Branches should obtain the above documents
immediately, in case not obtained earlier.
3. Partnership Firm account, the following documents( Refer CHAPTER 2, POINT 23.2A-3):- are to be obtained in
addition to documents listed above at Sr. No. 1:
a) Partnership Letter in Bank’s format;
b) Registration certificate, if registered;
c) Partnership deed (Registered) ;
d) Power of attorney, if any, granted by the firm to transact business on its behalf;
259
 Particulars
e) An officially valid document (i.e. documents listed at Sr. No 1 above) in respect of the person holding an attorney
to transact on its behalf;
4. Trust account, the following documents ( Refer CHAPTER 2, POINT 23.2A-7):-are to be obtained in addition to
the documents at Sr. No. 1 above in respect of all trustee):
a) Registration certificate, if registered,
b) Trust deed (Registered);
c) Resolution for opening and operating the account, signed by all the Trustees;
d) A list of the names of the trustees with their addresses;
e) An officially valid document (i.e. documents listed at Sr. Nos. 1 above) to identify the those holding Power of
Attorney;
f) Specimen of Indemnity Letter by Trustees in a Trust Account (( Refer CHAPTER 2, annexure xviii)

5. Unincorporated association or body of individuals- Proof of Identity and Address are to be obtained required of
each individual at the time of opening an account as per the documents listed at Sr.No. 1 above):
a) Resolution of the managing body of such association or body of individuals;
b) Power of attorney, if any, granted to transact on its behalf;
c) An officially valid document in respect of the person holding an attorney to transact on its behalf (i.e. documents
listed at Sr.Nos.1 above); and
d) Such information as may be required by the bank to collectively establish the legal existence of such an association
or body of individuals.
(Partnership Firm, Trust or any entity which is not registered at the time of opening of account, such entity must be
treated as Unincorporated entity.
6. Company, the following documents are to be obtained, in addition to documents listed above in Sr. No. 1:
a) Certificate of incorporation;
b) Memorandum and Articles of Association;
c) A resolution of the Board of Directors to open the account and conveying authority to operate the account;
d) Power of attorney, if any, granted by the Company to transact on its behalf;
d) An officially valid document (i.e. documents listed in Sr. Nos. 1 above) in respect of person holding a Power of
Attorney;
e) Certificate of Commencement of Business (for Public Ltd. Cos.);
f) List of present Directors / shareholding pattern of the company duly certified by the Statutory Auditor of the company;
g) A list of authorised signatories for operating the accounts with their signatures duly authorised by the Chairman /
Secretary;
f) Specimen of Resolution for Opening of Accounts of Limited Companies AND Societies, Associations,
company & club incorporated under the Companies Act, 1956( refer CHAPTER 2, Annexure XIII)
G)Declaration to be obtained from the current account holder(company/firm) for not having borrowing
facilities with other branch/bank (Refer Annexure I )

7. In the case of every Society / Association / Club the following documents should be obtained, in addition to the
documents listed at Sr. No. 1 above:
a) Certificate of Registration, if registered;
b) Memorandum of Association;
c) Rules, regulations and bye-laws;
d) Committee resolution for opening and operating the account;
e) A list of authorised signatories with their signatures duly authorized by the Chairman / Secretary;
f) Specimen of Resolution for Trust Accounts: Current or Savings Bank Account( refer: chapter 2, Annexure
xv)

8. In the case of every Hindu Undivided Family (HUF), the following documents should be obtained, in addition to the
documents listed at Sr. No 1 above:
a) Declaration from Karta;
b) Joint Hindu family letter signed by the Karta and all the major co-parceners;

4.2 Branches are normally opening current accounts and allow operations therein
without making any inquiries whether the account holder is enjoying any credit facilities
with other Bank. It may so happen that the borrowers of one bank open current
accounts with other banks and conduct operations through such accounts instead of
routing all their transactions in the accounts maintained with the lending bank and
thereby violating credit discipline. This is more common where a customer is enjoying
borrowing facilities against book debts. To safeguard the interest of the lending bank,
it would be essential to obtain a declaration from a firm or a company which desires to
260
open a current account that the firm or company is not enjoying any credit facility with
any other bank. If they are enjoying any credit facilities, they must give full particulars
of such facilities with the name(s) of the banks concerned. The Bank has every right to
refer to the lending Banks concerned for Status reports/No Objection Certificate before
opening such other bank borrowers’ CD accounts with the Bank.
I Declaration and undertaking as per Specimen-Appendix-I to be
obtained from a firm/company not having any borrowing/banking facility with
any other bank.
II Declaration and undertaking as per Specimen - Appendix II to be
obtained from a firm/company enjoying borrowing/banking arrangements with
the Bank as well as with other banks.
Current Account in the name of Staff Relative
4.3 In case of Current Accounts opened in the name(s) of the staff/relatives of staff
members the following procedure should be adopted:
(a) Details of all Current Accounts in the name(s) of close relatives of staff members
operated and maintained at a Branch should be reported to the next Controlling
Authority i.e. Zonal Manager. The format for reporting purpose is given in Appendix
VII.
(b) Branches which do not have any such account should submit a `Nil' Statement.
(c) The branches should also submit to the next Controlling Authority the particulars of
operations in these accounts every quarter as per the format given in Appendix VII.
(d) Branch Manager is the authority to authorise the opening of such accounts.
(e) The current accounts of all staff members held in their names either singly or jointly
with any other person should be checked by an officer of the branch.
(f) Manager should carry out periodical scrutiny or test check of such accounts.
(g) All credit vouchers relating to all staff accounts including paying-in-slip should be
countersigned by an officer of the Branch.

4.4 A Other Accounts: While the operational instructions can be in any manner (say
either or survivor or former or survivor or any one Partner/Director/Trustee etc,), the
same would be jointly authenticated in the account opening form in case of
Partnership Firms and in case of Limited Companies or Trusts or Societies etc would be
in accordance with the Board Resolution or the Trust Deed or the Bye Laws as the case
may be.
5.1 While opening the account, the official concerned should explain to the
prospective customer the requirement of maintaining minimum balance and the penal
charges in case of non compliance.

Branches must display on the Notice Board at conspicuous place in the Banking Hall
the above details and ensure that it draws the attention of customers.

261
 Temporary Overdrafts
6.1 Payment of cheque(s) or debit voucher(s) causing a current account to be overdrawn
must be authorised by Manager who should initial on the cheque/voucher in token of his
approval. (The extent of authority to grant temporary overdraft is given in the booklet
containing the scheme of `Delegation of Powers' which is revised from time to time).
Such cheque(s)/voucher(s) should be entered in the Register of Temporary Overdrafts
(Form CD 28 - Specimen: Appendix-VIII). The Manager should also initial the entry in
the Register. Payment of subsequent cheque(s)/Voucher(s) in an account in which
temporary overdraft has been permitted and is outstanding should be passed for
payment likewise, if the intention is to allow the account to be further overdrawn. The
date when a temporarily overdrawn account is put in order should be recorded in the
Register of Temporary Overdrafts under appropriate column and initialled by the
Manager. The circular on Delegation of Powers issued from time to time by the Head
Office should be refered to in any matter pertaining to temperory overdrafts.
6.2 The Manager should not make it a practice to accommodate any account holder by
granting temporary overdrafts as the Bank might be involved if in one instance the facility
is not given and a cheque is returned unpaid. The facility of permitting account to be
temporarily overdrawn should be given on a very restrictive/selective basis. The
occasions to grant temporary overdrafts should be few and far between in any account.
The extent of temporary overdraft permitted should bear a reasonable proportion to the
average balance in the account and the means of the account holder(s).
6.3 When the account is allowed to be overdrawn temporarily, Branches should send
to the account holder(s) an advice requesting him to put the account in order
immediately (Form CD 57) and should follow-up regularly until the account is set right.
6.4 Where the account holder requires the facility of drawing in excess of balance, it is
advisable to consider granting a regular overdraft limit for which a proper proposal
should be submitted for sanction at appropriate level.
6.5 Where a customer, owing to the peculiar nature of his business, requires "cheques
against cheque" facility on a regular basis against cheque(s) lodged in his account,
Branches should put up for sanction, at appropriate level, a suitable proposal. (Also
refer to the scheme of 'Delegation of Powers'.)
6.6 Following action should be taken in day-to-day management of clearing portfolio,
especially in regard to permitting withdrawals against cheques sent in clearing:
i) The limits against clearing cheques should be sanctioned only in respect of first class
customers and even in such cases, the extent of the limits and the need therefore
should be subjected to a thorough scrutiny and periodical review.
ii) Such drawings should be normally confined to bank drafts, Government cheques and
to a limited extent, third party cheques.
iii) Drawings against cheques of allied/sister concerns should not be permitted.
iv) The facility should normally be only of a temporary nature and should not be allowed
on a regular basis without proper scrutiny and appraisal.
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v) The Managers should exercise their discretionary powers in this regard very sparingly
and that too only in respect of respectable customers and should not normally exceed
the sanctioned limits/ discretionary powers.
vi) The conduct of the accounts where facilities are allowed against uncleared effects
should be closely watched to ensure that the constituents do not misuse the facility.
6.7 A separate Register should be maintained for regular limits against uncleared
effects, sanctioned by the Branch Manager. A separate Register should also be
maintained for casual withdrawals against uncleared effects, permitted by the Branch
Manager, in his discretionary authority. In this latter Register, a separate column should
be provided for recording full particulars of cheque(s) deposited against which
withdrawal was permitted and whether such cheque(s) was/were realised and date of
realisation should also be recorded. Both these Registers should be made available to
inspecting officers and to internal auditors.
6.8 The debit balances of temporarily overdrawn accounts should be jotted daily (except
on the balancing day) in the Daily Extract of Overdraft balances (form OD 145) and
checked by the concerned ledger checking officer. Statement of TOD is to be sent
monthly in Form BR 3 (A) as given in Appendix-IX.

Interest Payable on Current Deposit Accounts:

7.1. In terms of the Reserve Bank of India's directive, payment of interest on current
accounts except the accounts of the exempted categories mentioned below, is
prohibited. Interest is also not payable on margin money held in current accounts with
Branches.

7.2. Interest should be paid on the credit balances lying in a current account in the name
of a deceased depositor, from the date of death of the depositor till the date of payment
of his/her legal heir(s), representative/s, and nominee/s at the rate applicable to Savings
Bank Deposits as on the date of payment. This is also applicable to current accounts in
the name of a proprietorship firm where the sole proprietor is deceased.

7.3. At times interest becomes payable in accounts where the cheques/other

instruments deposited are drawn on the outstation branches and sent for collection, if
the proceeds are not realised/credited to the customer's accounts or the unpaid
instruments are not returned to the customers within a specified period from the date of
their lodgement. Interest at the rate of as conveyed by H.O. from time to time should be
paid for such delayed collection. Such interest should be paid only when the amount of
interest is Rs. 5/- or more. Interest should not be paid on cheques/other instruments
lost in transit.

7.4. Such cases, however, should be rare as with the services of the Service Branches,
Courier Services/Speed Post speedy collection of instruments is possible. Where such
interest is to be paid for the delay in collection, the matter should be reported to the
appropriate higher authority giving specific reasons for the delay and prior sanction be
obtained before payment is made. It should be noted that the period specified has been
allowed only for the purpose of calculating interest as aforesaid and under no
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circumstances it should be construed that the Bank can take this much time for
collection/return of outstanding instruments. Prompt despatch of collection instruments
and timely follow up would ensure a smooth collection service.

7.5. Current Accounts maintained by the Regional Rural Banks only with the Sponsor
Bank would earn interest at the rate mutually agreed upon by the Regional Rural Bank
and the Sponsor Bank, which is presently nil. This rate is subject to change as and
when reviewed by the Sponsor Bank. Such interest should be calculated on daily
product basis and be paid at half-yearly intervals in March and September every year.
In terms of the existing RBI directives interest need not be paid on current account
balances of Regional Rural Banks not sponsored by us.
Balance Confirmation Letters
8.1 In view of the instructions printed in the Current Account Statement Form, it is not
necessary for the Branches to send a Balance confirmation letter (Form No. CD 58) to
all current account holders except holders of:
i) Overdraft Accounts
ii) Trust Accounts
iii) Non-resident Accounts
iv) Accounts where the Branch Manager considers it necessary in the Bank's interest
to obtain confirmation letter.
8.2 Branches should send to these account holders a Balance Confirmation Letter
(Form CD 58) once a year (as of 31st March) as soon after March closing as possible.
8.3 When Balance Confirmation Letters are received back from these account holders
duly signed, they should be attended to immediately. Signatures on Balance
Confirmation Letters should be verified by cancelling officers in the usual manner.
(Balance Confirmation Letters must be signed by account holders in exactly the same
manner as cheques are drawn on the accounts.)
8.4 The Manager should pay personal attention to ensure that Balance Confirmation
Letters are received back duly signed by the holders of:
(a) Trust accounts
(b) Non-resident accounts
(c) Accounts where operations are few and far between
(d) Accounts where there have been occasions for return of cheques for reason
"Drawer's signature differs"(e) Accounts operated by the Attorney or the Mandatory.
(The letter should be signed by the Donor/ Mandator).
8.5 Apart from the Balance Confirmation Letters sent as on 31st March, the Manager
may also send at his discretion Balance Confirmation Letters on any other days for the
above-mentioned accounts.
8.6 Account holders who have not confirmed their balances may be requested to do so
whenever they happen to come to the Bank personally. If necessary, reminders should
be sent.
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8.7 Indemnity letter regarding Payment of balance of deceased account holder.
(Refer chapter-2, Annexure XXIII)

Current Account Statements

9.1 Branches may send statements of accounts at the option of the current account
holders. If a statement of account is to be sent, the frequency thereof should also be
noted. In accordance with these instructions, prepare and despatch statements of
accounts to account holders within 5 days from the date to which the statements relate.

9.1A To obviate delay, the current account statements should be sent to customers in
a staggered manner instead of sending them by a target date every month, in case the
branch is having large number of current accounts. Otherwise, statements should be
dispatched in one lot.

9.1B Branches may request the customers to avail the facility of e-mail statement. A
system driven e-mail statement is being sent centrally. The branch may request /advise
the customer to avail the internet banking/mobile banking facility as it provides greater
ease in transactions.

9.2 credit entry in a statement may be binding on the Bank if the account holder can
show that he altered his position by relying on such a credit entry. With regard to a debit
entry in a statement, the account holder is under no duty to check the entries and he
can repudiate incorrect debits to his account. Care should be taken to see that the
account holder's credit is not harmed by return of a cheque drawn in reliance upon the
erroneous posting in the account. The system of authorisation in Branches, therefore,
must be such that mistakes or errors in postings such as, posting of wrong amount or
posting in wrong account and extension of wrong balances are avoided. When any
mistake or error in posting is found, the account holder should be advised immediately
and the error should be rectified.

9.3 It is desirable to avoid abbreviations while posting the entries. The customers must
understand the entries without difficulty. However, the following 12 standard
abbreviations may be used.

Remittance Per
(i) CLG Clearing Cheque (vii) Rpp
Post
Returned
(ii) D/W Dividend Warrant (viii) Rtd.
(iii) F.D.R Fixed Deposit Receipt (ix) Reptd. Represented
(iv) INT Interest (x) S/C Safe Custody
Standing
(v) PRO Proceeds (xi) S/I Instructions

Transfer Cheque
(vi) R/C Returned Cheque (xii) TR
on Ourselves

9.4 Full postal address of the account holder should be appear on the first sheet of the
265
statement; each statement sheet should bear the name, number of the account.

9.5 As a rule, statements should be despatched by post or hand delivery, unless

account holders call for them personally; statements may, however, be handed over in
closed covers to the known messengers or representatives of account holders. (Also
refer the Chapter on Deposits-General). A record should be kept in a register/pass book
of statements of accounts despatched to account holders. (A specimen of the ruling is
given in Appendix III). Where the statement is returned undelivered due to change of
address, efforts should be made to contact the account holder to obtain the correct
address.

Duplicate Current Account Pass Books/Statements

10. Branches may issue duplicate statements to account holders upon their written
request. The letter should be signed in the same manner as cheques drawn on the
account are signed. Charges at the rate prevalent at the relevant time should be
recovered from the account holders. Care should be taken to see that no annoyance is
caused to valued account holders. The word DUPLICATE should be written on the
statement and a suitable remark should also be made in the a/c.

Charges for issue of duplicate Statement of account should be credited to Profit and
Loss Account `Miscellaneous Receipts'.
Return of Paid Cheques
11.1 Some account holders require their paid cheques to be returned to them at agreed
intervals. The facility of returning paid cheques should be extended to only approved
customers selectively at the discretion of the Manager. A Letter of Undertaking
(Specimen-Appendix IV) should be taken when any such arrangement for the return of
paid cheques is made in an account. A note of such arrangement should be made at in
the account under special instructions.

11.2 Cheques which are in dispute should not be returned until the dispute is settled.
Paid cheques may be returned upto the last date for which the current accounts are
balanced.

11.3 It should be ensured that the paid cheques (after authorisation by an officer is
completed) are kept separately every day neatly arranged and bundled till they are
required to be sent along with the duplicate copy of the statement of account. A
statement of account should be prepared on Form CD 79A in triplicate - the original
serving the purpose of statement of account, the duplicate to be sent along with the
paid cheques and the last copy to be retained at the Branch to serve as the "Duplicate
Voucher" for the paid cheques returned which should be carefully preserved like
vouchers either by keeping it along with the bundle of vouchers relating to the month or
by keeping it filed in a separate file. At the time of returning the paid cheques
(periodically), it should be ensured that they are arranged in the same order in which
they appear in the statement of account and particulars of their dates and the names of
banks through which they were paid should be entered under the columns provided for
this purpose in the statement of account (second and third copies) - these entries are
266
 necessary to have a complete record of the paid cheques returned.
11.4 At the time of sending the copy of the statement of account with the paid cheques,
a printed covering letter (Form CD 108) should be used as a covering letter - this also
contains a counterfoil which is required to be returned by the account holder
acknowledging receipt of the cheques and confirming the balance in the account. It is
important to get back the acknowledgment (counterfoil) duly signed by the customer (in
case of debit balance, over appropriate revenue stamp) and the matter should be
followed up until it is received.

11.5 If any difficulty is experienced in obtaining the counterfoils containing the

acknowledgment-cum-balance confirmation promptly and regularly from a customer,
the Branch Manager should suitably notify the customer, regretting the Bank's inability
to continue the facility and should withdraw it.

Dormant Current Accounts

12.1 A savings as well as current account should be treated as inoperative / dormant if
there are no transactions in the account for a period of two years. For the purpose of
classifying an account as inoperative, both the types of transactions, i.e. debit as well
as credit transactions induced at the instance of customers as well as third party should
be considered. RBI has clarified that interest on term deposits credited to the account
of the customer should be treated as customer induced transaction since it is according
to the mandate of the customer. In such cases, ,the account should be treated as an
operative account as long as the interest on term deposit account is credited to the
Savings Bank account. The Savings Bank account can be treated as inoperative
account only after two years from the date of the last credit entry of interest on fixed
deposit account. The Current A/c termed as dormant should be transferred in February
and August each year to Sundry Deposit Account - "Unclaimed Balances" maintained
under the head "Sundry Deposit". The total of the balances in this head being reflected
in the General Ledger account "Sundry Deposits".

12.2 Accounts should not be transferred to Sundry Deposit Account - "Unclaimed

Balances" in the following cases:

(a) Where an account is stopped under a garnishee or other Court order

(b) Where operations of an account are stopped till the grant of legal
representation is received
(c) Where, for particular reasons, discretion would dictate that an account
should remain current. (If, for instance, there is an operative Account No.
I and a dormant Account No. II with a small balance, and the account
holder is known to be doing active business, it would ordinarily be decided
not to transfer the balance of the dormant Account No. II to Sundry
Deposit Account - "Unclaimed Balances").

Operationalizing the Dormant / Inoperative accounts

i. Branches should identify all the inoperative accounts, not operated for more than two
years, and with a balance of Rs 1000/- to be classified as inoperative account through
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system every half year. Branches should approach the customers and inform them in
writing (A suitable system generated communication will be sent to such customers )
exhorting them to (a) activate their accounts or (b) they may be asked to provide details
of their existing Bank account details, if they are shifted to new area so as to transfer
the amount lying in the account.

ii. Branches are required to make an Annual review to identify inoperative accounts and
send communication to the customer stating that the account will slip into the
inoperative/dormant category within 3 months. In all such cases, where the accounts
continue to be inoperative even after sending a written reminder, the customers will be
contacted over ‘phone or in person for getting the accounts activated and a record
thereof shall be maintained at the branch. In cases where the letters sent by the Bank
are returned undelivered, the branch should make efforts to contact the customer
immediately thereafter by approaching the introducer or the neighbors at the last
recorded address and gather information about the accountholder’s present
whereabouts.

iii. In all other cases, i.e. accounts with balances of less than Rs 1,000/-, system
generated reminders will be sent after one year from the date of last customer induced
operation in the account and necessary follow up through phone calls/ personal visits
to the address given at the time of account opening/ last recorded address for getting
the account activated. If necessary, help of the introducer /customer’s neighbors be
sought to contact / locating the customer for the above purpose. In case of deceased
customer the details of legal heirs are to be obtained.

Steps to be taken when requests for activation are received

When a request for activation of a dormant account is received, approval for activation
should be accorded by a designated officer at the branch. She/he will verify and satisfy
her/ himself that the account was opened in a KYC compliant manner and the reasons
adduced by the account holder for not operating the account are genuine. Fresh set of
KYC documents in respect of residence proof shall be obtained and the same should
be confirmed by sending letter to the above address given by the customer. Further it
should be seen that the amount of deposits being made is commensurate with the
occupation level of the customer, as declared in the account opening form and the
transaction should be closely watched.

Register of Dormant Current Accounts

13.1 Particulars of dormant current accounts transferred to Sundry Deposit Account -

"Unclaimed Balances" should be maintained in the Register of Dormant Current
Accounts (Form CD 29), so that these particulars are available at one place, year after
year, and obviate the necessity of recording them in each subsequent new Sundry
Deposit Ledger opened. Balances of outstanding dormant accounts in the Register of
Dormant Current Accounts should be jotted half-yearly and tallied with the Balance of
Sundry Deposit Account - "Unclaimed Balances".

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13.2 The Register should be opened alphabetically, with adequate number of pages
allotted to each alphabet so that, in future years also the record is maintained
alphabetically. The particulars in the Register of Dormant Current Accounts should be
as follows:

a) date on which the account was opened

b) file number, account number and special instructions, if any
c) title of the account
d) balance and date of last operation on the account
e) cheque series numbers outstanding
f) date when balance paid and how paid
g) remarks.

13.3 At the end of the Register, a few pages have been provided with a different ruling.
These pages are for balancing and if properly used, would ensure that the total of
"Unclaimed Balances" in Sundry Deposit Ledger agrees with the outstanding balances
of all dormant accounts in the Register. When recording transactions, the voucher -
credit or debit - should be posted in :a) Sundry Deposit Account - "Unclaimed
Balances"and b) The Register (in the pages with special ruling which are provided at
the end).A fresh balance should be extended in the Sundry Deposit Account -
"Unclaimed Balances" and in the pages at the end of the Register. The balances shown
both in the Sundry Deposit Account - "Unclaimed Balances" and in the pages at the
end of the Register must always agree.
13.4 When transferring balances of inoperative current accounts to Sundry Deposit
Account - "Unclaimed Balances", a ledger-wise list of such accounts should be
prepared with one set of transfer vouchers for the consolidated balance of all the
accounts to be transferred. Postings should be made in the respective accounts in the
ledger from the list and the credit voucher should be posted in Sundry Deposit Account
- "Unclaimed Balances", particulars of current accounts, balances of which are
transferred, together with the respective balances should be entered in the Register as
required in the foregoing paragraphs. The amount of credit voucher should also be
entered in the last pages in the Register. The occasions to debit Sundry Deposit
Account - "Unclaimed Balances" arise when an account holder claims the balance of
the dormant account or starts operating on the account.
13.5 Before returning a cheque with the reason "Account closed", the officer should
first ascertain (from the Cheque Book Delivery Register) the title of the account and
search for the account in the identified Dormant Current Accounts. If an account is
traced in the dormant accounts, before paying the cheque, the balance of the dormant
account (as noted in the Register) should be transferred from Sundry Deposit Account
- "Unclaimed Balances" to the appropriate current account ledger. All particulars of the
dormant account available in the Register should be noted in the regular ledger
account. While effecting the transfer of balances of dormant accounts from Sundry
Deposit Account - `Unclaimed Balances' to current account ledgers, any payment (i.e.
debit vouchers) from this account should be permitted only under the signature of two
authorised officials, one of whom must be the Branch Manager ( Manager/Senior
269
Manager in case of larger branches) who will do so after satisfying themselves that the
proposed operations on the accounts are under circumstances which do not arouse
any suspicion. The drawers' signatures on cheques on inoperative accounts should be
verified with more than usual care.14.6 Under Section 26 of the Banking Regulation
Act, 1949, banks are required to submit to the Reserve Bank of India the particulars of
accounts dormant for ten years. A record of the date of last operation in dormant
account is, therefore, necessary so that accounts dormant for ten years can be reported
to the Reserve Bank of India. It is necessary, when opening new ledgers, to make a
note in the ledger pages of accounts which have remained dormant say, for the last 6
months, in the following manner:
"Not operated upon since ...................................................................................." (State
the date of last operation)

13.7 It should be borne in mind that the particulars of accounts dormant for ten years
is to be obtained from:
a) Current Accounts identified and marked to by the system
b) Current accounts which may be dormant for ten years (but balances of which are
not transferred to Sundry Deposit Account - "Unclaimed Balances") for some special
reasons.
13.8 It is of utmost importance that the balances in all accounts which are dormant or
where operations are few and far between are confirmed on the Bank's usual Balance
Confirmation Letters. The Managers should give personal attention to see that this is
done. Letters (Specimen - Appendices V and VI) may be sent to account holders
whose accounts have been dormant with comparatively small balances for a
considerable time. The shorter letter (Specimen - Appendix V) should first be sent to
the account holder whose account is dormant. A diary note may be taken for a
reminder to be sent six months later. At the expiry of six months the account should
again be scrutinized. If the account holder has not taken appropriate action either by
closing the account or by resuming transactions, the second and longer letter
(Specimen - Appendix VI) may be sent. The Branch Managers are advised to use
these forms with discretion. They should not hesitate, where circumstances require, to
send a polite, specially worded letter, instead.
Other Instructions

The Instructions given in Chapters on Deposits - General and Current/Savings Bank

Accounts - General shall also apply to Current Accounts.

14.1. The Bank in its effort for mobilizing low cost deposit had introduced Tierisation of
Current Accounts under scheme code CD-201, 209 & 211. The tierised Current
account is based on relationship based pricing model, wherein, customer is
encouraged to avail maximum benefits in the form of discounts and waiver on service
charges, if the depositors are willing to maintain requisite Monthly Average Balance
(MAB). The motive of upgrading the account is to offer additional
incentive/discount/freebies to the one who is maintaining higher Monthly Average
Balance, so as to induce them to maintain the higher Average Balance in an account.
270
Bank is offering 4 variants of Current Accounts (Normal, Gold, Diamond and Platinum)
at different price levels with additional benefits/concession & value additions to the one
who is at higher level of tierisation. Earlier there were 8 variants which was Normal,
Silver, Gold, Gold Plus, Diamond, Diamond Plus, Platinum & Platinum Plus. It was
difficult for branches to market these variants as there were only little difference in
privileges & concessions from one variant to another hence the variants are being
reduced to four.

14.2. In case of non-maintenance of requisite MAB, applicable penal charges along

with GST shall be levied.

14.3. Up-gradation and down-gradation of tierised Current Account will be done every
month by the system based on the MAB maintained for the previous month. But, as
stated above, penal charges shall be levied only if MAB goes below minimum threshold
limit.

14.4. Since the penal charges shall be levied only if MAB(required to be maintained in
a month) goes below the minimum threshold limit. Accordingly, competent authority
has decided to henceforth withdraw the authority given to reverse the penalty
levied for non- maintenance of MAB in tierised current accounts. Earlier the
delegation was vested with the Branch Heads of all grades/ scales to avoid any
customer complaint and also due to the reason that it was not feasible to obtain written
consent of ALL account holders before the implementation of tierisation.

Revised Modification/ Changes in Other Current Accounts.

15.1 Special schemes of Current Accounts earlier launched viz. Star Benefit CD A/C
and also the segment specific current account viz. NRO & NRE Current Account,
RERA Current Accounts are also tierised in 4 tiers i.e. Normal, Gold, Diamond &
Platinum categories with adherence of RBI, FEMA & Govt guidelines. Upon migration
of these schemes into tierised products based on MAB, the privileges & concessions
will be made available to their variants i.e. Normal, Gold, Diamond & Platinum
categories.

15.2 The growing need of business & merchants for digital payments have been duly
recognized. We have added features like POS Machine, QR code & issue of credit
card/ATM card which would be available for free or at concessional rates based on the
balance (MAB) maintained by the customers. The existing Current Account products
shall be offered with QR Code/POS/UPI/Voice Box/Payment Gateway etc.

15.3 The insurance of stocks & material is also proposed to be offered under
fire/burglary/theft insurance through our tied up partners in General Insurance. This
will be offered at concessional premium. For individual & proprietorship current
accounts, personal accident insurance is proposed for customer.

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15.4 Above area of changes & modifications were identified as critical to success of
Current Accounts Products. Therefore, various schemes/variants have been
taken up for modification & improvements in Current Account Product & their
variants which are summarized as under: -
i. Current Account- General (Scheme Code-CD201) with 8 variants, Normal,
Silver, Gold, Gold Plus, Platinum, Platinum Plus.
ii. Star Benefit CD Plus Account (Scheme Code- CD 201 with special charge
code” CDP”)
iii. Star Crystal Current Account (Scheme Code- CD201 with special charge
code “CRYST”)
iv. Current Account- Institutional (Scheme Code-CD211)
v. Current Account- Collection (Scheme Code-CD209)
vi. Current Account- NRO (Scheme Code-CD205)
vii. Current Account NRE (Scheme Code- CD206)
viii. RERA Plus & RERA Current Account (Scheme Code- 224& 225)
ix. Current Account Deposit Plus Scheme
x. BOI Super Plus Current Account Scheme

15.5. In all above mentioned Current Account Schemes, the features, privileges &
concessions are proposed to be parameterized on the basis of Monthly Average
Balance (MAB).

15.6. Increase in penal charges on account of non-maintenance of minimum

Average Quarterly balance in Current Plus Deposit and Super Current Plus
Deposit (Sweep-Out/Sweep-in accounts) as follows:
Average Quarterly Balance Revised Penal Charges
requirement
Current Plus Rs. 4 Lakh Rs. 1000/- + Applicable
Deposit Service Tax per quarter
Super Current Rs. 35 Lakh Rs. 5000/- + Applicable
Plus Deposit Service Tax per quarter

The accounts under the said schemes shall be available for tierisation and benefits &
modalities of respective category of tierised account shall be applicable.

15.7. For the convenience of our valued customers, Bank has started sending e-mail
statement to All Current Account holders wherever e-mail id is available in the system
on monthly basis. To enhance our communication channels, we send communication
directly to our Tierised Current Account holders (normal, Gold, Diamond and Platinum)
regarding their present category and benefits/incentives & other modalities extended
by the Bank in the particular category via e-mail and SMS. For seamless
communication from Head Office level, Branches should update the PAN, Constitution
code, Mobile No, E-mail id, communication address etc. of the customers to enable us
to send communication directly to customers.

A healthy Current Account portfolio reflects the Bank's strength and deep engagement
with customers. It is the key performance indicator and important component to boost
the Net Interest Margin (NIM). Branch Manager should ensure that all staff members
are well acquainted with the product features and its advantages so that substantial
272
business is mobilized by the bank.

Type of Current Accounts

16.1 The Bank in its effort for mobilizing low cost deposit had launched Current
Accounts at attractive price points. The tierised Current accounts have striking
unique & distinguished features which shall be envied by our competitors. The
tierised current accounts are designed on the Monthly Average Balance (MAB)
requirement instead of Minimum Balance stipulation which is an irritant to the
account holder.

16.2 Bank in its endeavor to make Current Account product one of the best in the
industry, has adopted a relationship based pricing model as it makes the product
profitable for the customer as well as for the bank in the long run. In the
relationship based pricing model, customer is encouraged to avail maximum
benefits in the form of discounts and waiver on service charges, if the depositors
are willing to maintain requisite Monthly Average Balance. The tierisation is
aimed at enhancing the acceptability of our Current Account products which is
available with additional features, discounts & value added offerings.

16.3 We highlight the features/ value additions available to Tierised Current account
holders:
I. No Daily Minimum Balance Stipulation
II. Monthly Average Balance requirement for Rural Branches Rs.2000/-, Semi
Urban Branches Rs.2000/-, Urban Branches Rs.5000/- & Metro Branches
Rs.10000/-.
III. New Current Accounts can be opened on DAY ONE ITSELF at higher tierised
levels like Diamond or Platinum etc. as the case may be, as requested by the
prospective customer
IV. Penal charges to be levied only if MAB goes below the minimum threshold
limit i.e. Rs 10000/- in Metro, Rs 5000/- in Urban, Rs.2000/- in Semi-urban &
Rural.
V. Free/ Reduced NEFT/RTGS Charges*
VI. Free Demand Drafts/ Pay Orders*
VII. Waiver on Processing Charges of Retail Loans*
VIII. Waiver on AMC charges on Demat Account* (only for first year)
IX. Free/ Reduced Charges on Cash Handling for Cash Deposit*
X. Discount on Point of Sale (POS) offer*
Note :- (*)The free or reduced charges/ discount on various service charges/ add on
facilities, are applicable for tierised accounts and are proportionately higher for
tierised accounts with higher Monthly Average Balances.

16.3 Bank is currently offering various Current Account Schemes which are opened
under different Scheme Codes and are identified accordingly. Out of which, the
accounts under the following scheme codes shall be available for tierisation
wherein majority of the current accounts are opened and maintained at our
Branches.
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16.4
Sr Name of the Product Scheme
No Code
1. Current Account - General CD-201
2. Current – Collection Account CD-209
3. Current Account - Institutional CD-211

The above three scheme codes constitute more than 98% of the current
deposit portfolio.

17. Categories of Tierised Current Accounts and their MAB requirement

Sr Category of Current AQB

No. Accounts
1 BOI Normal Current Up to Rs 50,000/-
Account
2 BOI Gold Current Account Above Rs. 50,000/- to
up to Rs. 2,00,000/-
3 BOI Diamond Current Above Rs. 2,00,000/-
Account to up to Rs.
10,00,000/-
4 BOI Platinum Current Above Rs. 10,00,000/-
Account

The tierised accounts under Scheme Codes - CD-201, CD-209 & CD-211 which are
known as Normal, Gold, Diamond and Platinum.

Please Importantly note that to extend the benefits under the respective tierised
Current Account for new or existing current, Branches are required to label the Current
Account as follows:-

For New Current Account: -OAAC -V-Free code 10- G, D, P, NO

Manual tagging as Gold, Diamond or Platinum is permitted only once at the

time of opening of account subject to obtaining an undertaking from the
customer that requisite monthly average balance shall be maintained in the
account for the chosen category. In such cases/ request, branch will categorise
this new current account in particular category and provide necessary input (G,
D and P) in account in the field free code 10.

The field will be non-editable and branch will be allowed to tag the account as
Gold, Diamond or Platinum as the case may be only at the time of opening of
account. Thereafter, modification in the account through HACM menu shall be
restricted and not to be permitted.

For Existing current Account: - ACM-V-Free Code 10- G, D, P, NO

274
 Free Code Description
10
G The Benefits & Modalities of Gold Account Apply
D The Benefits & Modalities of Diamond Account
Apply
P The Benefits & Modalities of Platinum Account
Apply
NO Non –Optee for Tierisation
The Scheme code and Free Code 10 are essential for identification of the account
and their category and also for the extension of benefits to the depositor.

Branch should update the PAN, Constitution code, Mobile No, E-mail id,
communication address etc. of the customers to enable us to communicate seamlessly
with the customers thereby reducing the workload of the Branches. Updated customer
details also help in better customer service.

Migration & System Level Integration:

18.1 The tierisation of Current Accounts is done on the basis of Monthly Average
Balance of previous month. Migration from one tier to another (up-gradation and down
gradation) shall take place on the basis of immediate preceding month MAB and on
monthly basis. Penal charge shall be levied only if MAB goes below the minimum
threshold limit.

18.2 Please Note:

1)The Branch Manager, based on the potential of the new account is authorized to
open a new account and tag it at a higher level of tierised account like Diamond or
Platinum, as the case may be, on the very first day of the opening the account with an
objective to strengthen relationship and business growth. In the next month system
would automatically tierise the account as per the MAB of that month. The prospective
customers, who are desirous of opening accounts under higher end tierised accounts,
are required to submit option/ request form. The Branch Managers are requested to
use this feature to effectively market and canvass good accounts.

2) At the system level, accounts would be tierised (up-graded and down-graded) on the
basis of Monthly Average Balance automatically upon completion of each month.

19.Current Deposit Plus Account

This product is a combination of Term Deposits and Current Deposit with very attractive
features and incentives for Customers. The product would maximize the returns for the
customers on their short-term funds which otherwise would not earn any interest in the
Current Deposit Account. On maturity, the Short Deposits both principal and accrued
interest, is renewed automatically for the original tenure.

During the tenure of Short Deposits, if need arises, the deposit can be paid before
maturity on 'last in first out' basis without penalty so as to ensure that the customer
275
does not bear higher interest loss. In such a case, the latest Fixed Deposit will be
broken (in multiples of Rs. 1,00,000/-) to meet the shortfall if any, in the balance in
Current Deposit Account if cheques are drawn in excess of balance available. The
Salient features of the scheme are as under: -

Sr Schemes /Parameters Current Deposit Plus Account

No
1 Initial Deposit Rs. 5 Lakh
2 Average Quarterly Balance Rs. 5 Lakh
3 Sweep in Daily
4 Sweep out On 1st & 16th ( Fortnightly Basis)
5 Multiple Amount Rs. 1,00,000/- ( Minimum balance in
SDR is Rs. 1,00,000/-)
6 Maximum Cap for Term No upper Ceiling
Deposit
7 Rate of Interest Card Rates as applicable to deposits
of above maturity periods
8 Penalty Rs. 1000/- per quarter for non-
maintaining AQB of Rs.5 lakh
9 Tax Deduction at Source The TDS norms would equally apply to
accounts and would be handled in the
usual manner
10 Lien on BOI Current Deposit The customer must not assign,
Plus Account transfer, charge, pledge or otherwise
encumber any “BOI Current Deposit
Plus Account” except in favour of our
Bank, as a security for any obligation
of the customer to the Bank

The accounts under the said scheme shall be available for tierisation and benefits &
modalities of respective category of tierised account shall be applicable.

20 .BOI Super Plus Current Account

Bank has introduced the captioned scheme wherein Sweep-out/ sweep in facility is
provided in current account and interest is paid on balances kept in FFD portion beyond
Rs. 35 Lakh in Super Current Plus deposit. The Salient features of the scheme are as
under: -

Sr Schemes/Parameters Super Current Plus

No Deposit
1 Initial Deposit Rs. 50 Lakh
2 Average Quarterly Rs. 35 Lakh
Balance
3 Sweep in Daily
4 Sweep out Daily
276
 5 Multiple Amount Rs. 15 Lakh (Minimum
balance in FFD portion
is Rs. 15 Lakh)
6 Maximum Cap for Term No upper Ceiling
Deposit
7 Rate of Interest Card Rates as
applicable to deposits
of above maturity
periods
8 Penalty Rs. 5000/- per quarter
for non-maintaining
AQB of Rs. 35 Lakh
9 Tax Deduction at Source The TDS norms would
equally apply to
accounts and would be
handled in the usual
manner
10 Lien on BOI Current The customer must not
Deposit Plus Account assign, transfer,
charge, pledge or
otherwise encumber
any “BOI Current
Deposit Plus Account”
except in favor of our
Bank, as a security for
any obligation of the
customer to the Bank

The accounts under the said scheme shall be available for tierisation and benefits -&
modalities of respective category of tierised account shall be applicable.

21 .Current Account for NRI Customers

The NRI customers can open Current Account with any of our BOI branch. The scheme
code for Current — Deposits (NRO) is CD 205 and the scheme code for Current —
Deposit (NRE) is CD 206. The following rules will govern their Current Accounts:-

Features NRE Current account NRO Current

Account
Eligibility NRIs • Any person
(individuals/entities of resident outside
Bangladesh/Pakistan India (other than a
nationality/ownership person resident in
require prior approval of Nepal and Bhutan).
RBI).
• Individuals/entities
of Pakistan
277
 Nationality/
ownership, entities
of Bangladesh
ownership and
erstwhile Overseas
Corporate Bodies
require prior
approval of Reserve
Bank of India.
Joint Account can be held Account can be held
Account of 2 jointly by a Non- jointly by a Non-
or more NRIs Resident Indian Resident Indian
(persons of Indian (persons of Indian
nationality or origin) / nationality or origin) /
with a Resident Indian with a Resident Indian
(Former or Survivor
basis). A Resident
Indian can operate the
account only as a
Mandate / POA holder.
The Resident Indian
must be a
close relative as
defined in
Section 6 of the
Companies act,
1956.
Currency in Indian Rupees (INR) Indian Rupees
which (INR)
Account is
denominated

Repatriability Freely Repatriable Principal up to USD 1

Million.
Subject to FEMA
2000 guidelines
revised from time to
time.
Interest Rate Not applicable Not applicable
Sweep-in Available Available
Facility
Taxation Funds in NRE Account Funds in NRO
are exempted from Account are
income tax in India taxable under
Indian Income
Tax Act

278
Note: - The rules/guidelines for NRI are subject to change from time to time and it will
be as per the latest guidelines issued by RBI/Bank.

22 .Facilities Extended to Current Account Holders

Cash Deposit:- The daily cash deposit limit/Cash Handling Charges are proposed
to be prescribed with a daily cap on the amount of deposit. The proposed Cash
Deposit Limit (Cash Handling Charges) as per table given in point 28.

Collection of Local Cheques/Outstation Cheques/Cheque payable in foreign

Countries: - All cheques and other Negotiable Instruments payable locally are
presented through the clearing system prevailing at the centre. Cheques deposited at
branch counters and in collection boxes within the branch premises before the
specified cut-off time is presented for clearing on the same day. Cheques deposited
after the cut-off time and in collection boxes outside the branch premises including
off-site ATMs is presented in the next clearing cycle.

Cheques drawn on other banks at outstation centres is normally collected through our
branches at those centres. Where the bank does not have a branch of its own, the
instrument would be directly sent for collection to the drawee bank or collected through
a correspondent bank. The bank would also use the National Clearing services offered
by the Reserve Bank of India at centres where such collection services exist.
Cheques payable at foreign centres where the bank has branch operations (or
banking operations through a subsidiary, etc.) is collected through that office. The
service of correspondent bank is utilized in country/centres where the correspondent
has presence. Cheques drawn on foreign banks at centres where the bank or its
correspondents do not have direct presence will be sent direct to the drawee bank
with instructions to credit proceeds to the respective Nostro Account of the bank
maintained with one of the correspondent banks.

For time frame of local /outstation cheques & other modalities, Branch may be guided
by policies & guidelines issued by Bank from time to time. Wherever applicable, facility
of High Value clearing should be given to customers. Bank offers concession in
collection of cheques in tierised Current accounts.

23. Fund Transfer

i) Intra-Bank Transfer: Customers can avail the facility of transferring money from
one account to another account within the Bank, Free of cost, at any of our Branch &
from Internet Banking. Branches should persuade the customer to use Internet
Banking for normal transfers as it saves time of customers & Branch personnel too
and it reduce the over-crowding of Branches.

ii) Inter-Bank Transfer: Inter Bank Transfer enables electronic transfer of funds from
the account of the remitter in one Bank to the account of the beneficiary maintained
279
with any other Bank branch. There are two systems of Inter Bank Transfer - RTGS
and NEFT. Both these systems are maintained by Reserve Bank of India. Bank offers
concession in RTGS and NEFT transaction from Branch premises in tierised Current
accounts. This facility is Free of cost for Platinum and Platinum Plus customers from
Branch Premises. The focus should be on shifting our customer base from Branch
Banking to E-Banking as it helps us to lessen the cost of servicing per customer and
also saves time & money of customers as well. NEFT/RTGS through Internet Banking
may also lessen the risk of bank arising due to erroneous typing/writing error of staff
resulting credit in wrong account.
iii) Some of the services can be used for Inter-Bank as well as Intra-Bank Transfer
transactions. We are enumerating below the list of such services which can be done
through online mode "Anytime Anywhere Anyway" (AAA):-

a) Instant Money Transfer (IMT): - IMT is an innovative domestic money transfer with
cash out facility. It allows our customers to send money to receiver 24*7*365 through
Retail Internet Banking or our Bank's any IMT enabled ATM, without using a card i.e.
withdrawal is Card less. The sender limit is Rs. 10,000/- per transaction and the limit
of receiver/beneficiary is Rs. 25,000/- per month. This is a very unique facility extended
to our valued customers and must be marketed extensively to gain the competitive
advantage as only few Banks are offering this facility.

b) IMPS: - IMPS offers an instant, 24X7, interbank electronic fund transfer service
through mobile phones. IMPS is an emphatic tool to transfer money instantly within
banks across India through mobile, Internet and ATM which is not only safe but also
economical both in financial and non-financial perspectives.

24 .Temporary Overdrafts (TODs)/ Drawing against uncleared effects: -

Temporary overdraft may be given on merits in exceptional cases to meet temporary

needs of customer in the Current Account to augment Bank's business. TOD should
not exceed 30 days. Please refer Manual of Instructions for details. The extent of
authority to grant temporary overdraft is as per "Delegation of Powers-Credit Matters"
which is revised from time to time.

25. Auxiliary Services

I. POS Services: - The point-of-sale (POS) is the time and place where a retail
transaction is completed. It is the point at which a customer makes a payment to the
merchant in exchange for goods or after provision of a service. Our Card Products
Department has been supplying the POS terminals to ME's (Merchant Establishment).

Card Product Department has relaxed the eligibility criteria/ due diligence and
approval authority norms.

Bank offers concession at prevailing Merchant Discount Rate for Credit Card
ranges ranging from 0.05-0.30% in tierised Current accounts. POS machines to
be extensively promoted and endeavour must be to provide it at every possible site in
the area of responsibility of the Branch. It helps us to earn fee income and improving
280
CD balances as it offers the healthy float in Current Accounts.

II. Cash Management Services (CMS): - Our Bank offers wide range of web based
cash management products which help the corporates/mid-corporates and business
houses to efficiently manage their resources with utmost accuracy and that too at
enormous cost savings. We employ state of the art technology and strive hard to
provide innovative solutions to suit the changing needs of the clients. Our STAR CMS
products are completely tech-savvy, designed to serve the contemporary needs of
clients. The Powerful & Robust MIS is compatible with any kind of client
platforms/ERP solutions.

III. Waiver of Processing Charges in Retail Loans: - We have extended waiver on

processing charges of Retail loan in different proportion in tierised accounts.

Branches may please note: -

• Retail Loan includes all schematic Retail Loans such as Housing Loan, Vehicle Loan,
Educational Loan and Personal Loan etc. (excluding Mortgage Loan which is generally
for business purpose).

• Retail Loan can be extended to individuals, Partners (As per partnership deed),
Companies Directors (As per Articles/Memorandum of Association), Trustees (As per
Trust Deed) etc. However, this concession is available only to the individuals
maintaining CD A/c in their names applying Retail loans in their individual names or
Partners apply for Retail Loans in their individual names whereas the CD A/c is in the
name of the Partnership firm, which is eligible for the concession listed in the circular.

In case of CD A/c is in the name of Pvt. Ltd., Trust etc., the concession in processing
charges cannot be extended to any individual in the capacity as the directors, trustees
etc.

26. Corporate Salary Packages

Bank offer attractive salary account package to our current account customers viz.
Companies, Partnership Firms etc. Our Salary Packages comes with some of the best
in class striking features Viz. Up to Rs.130 lakhs accidental Death Insurance Cover,
Waiver in interest rate and processing charges in retail loans, attractive OD facility. We
should market aggressively our salary products to existing Current account customers
and borrowers to get healthy CASA balances. Large Corporate Branches must try to get
all the salary accounts of our borrowers especially where we are a lead Bank.

E-mail statement of Account

Bank has started sending e-mail statement of account to various category of tierised
Current account holders on monthly basis. The above mentioned set of customers
receives their e-mail statement in 1st or 2nd week of every month usually constituting
the consolidated transaction executed by the account holder in the preceding month. It
enables the customer to access their statement on their respected PC/Mobile phone
anytime, anywhere and saves their unnecessary visits to Branches to check the
preceding month transaction. This activity is performed by Data Warehouse, HO
281
Department every month and any query/complaint/clarification should be ideally marked
to them.

Business Debit & Credit card

The following two variants of Business Debit cards (Visa and Rupay) can be issued with
the name of the firm/company on the card in addition to the name of the card -

Business Credit card (visa) can be issued to Sole Proprietor, Partners, Directors
of Pvt. Ltd./Public Ltd. companies in their individual/ personal capacity. Credit
Card is to be promoted as bank earns fix percentage of the transaction amount
whenever customer swipes credit card on POS and earns interest on monthly basis on
the unpaid bill amount. The Interest rate charged on unpaid bill amount is more than the
normal credits extended by the Bank.

Corporate Internet Banking

Corporate Internet Banking can be issued to Non-Individuals like Partnership Firms,
Public Ltd. Company, Private Ltd. Company, Trust, Society, Body corporate etc. Beyond
the facility of Retail Internet banking, it meets the complex requirement of corporate
customer like profile based access, account level restriction for their multiple users,
imposing limit on the fund transfer, Multi-level work flow for doing transactions in maker
checker, file upload for bulk transaction, details of trade finance accounts etc.
NEFT/RTGS through Internet Banking is "Free of Cost" and at discounted rates
through branches in Tierised Current Accounts.

27. CLOSURE OF CURRENT ACCOUNT

Whenever an account holder desires to close an account, a request in writing duly
signed by all the account holders should be obtained. It should be ensured that all
unused cheque leaves issued to a current account customer whose account is closed,
are returned to the Bank immediately or within a reasonable time after the account is
closed, as such unused cheque leaves are likely to be used for fraudulent purposes.

Presently Bank charges customers for closing their accounts before completion of
stipulated time period of 12 months. However as per Code of Bank's commitment to
customers, 2009, bank shall not levy any charges for closure of accounts within 14 days
from opening of the account. For Closure of CD accounts after 14 days and before 12
months there will be penal charge applicable as per circular issued on Service charges
by Head Office (subject to revision from time to time) for all type of branches.
Branches are hereby advised and instructed not to allow any closure of current account
unless warranted and that too with the approval of the Branch head only. The Zonal
Office should put in place a system to monitor the closure rate and critically examine the
reasons for closure of EACH AND EVERY ACCOUNT.
As you are amply aware of the fact that the growth of Current account deposit is
undoubtedly linked with the quality of customer service delivered at branches. The
subdued position of Current account deposits gives clear indication that customer
service has occupied backseat or not up to the mark. We need to be in "listen mode" to
customer requirement/sensitivities and be in "mission mode" to extend seamless
customer service and lift the level of Customer Service. Service quality and brand loyalty
282
goes together. If the customer is served with the expected quality and the services are
delivered as per the promises, then satisfaction level increases and loyalty level are
intact. If there is a gap in this area, then loyalty factor is put under strain.

28. Based on Monthly Balance Tierisation of Current Account:

Sr. Features Normal GOLD DIAMOND PLATINUM
No
.
1 Tierisation of Balance upto Rs MAB Range- Above Above Rs. 2,00,000/- to Above Rs. 10,00,000/-
Current A/Cs 50,000 Rs. 50,000/- to upto upto Rs. 10,00,000/-
based on Rs. 2,00,000/-
Maintaining
Monthly
Average
Balance
2. Initial Deposit NIL NIL NIL NIL

3 Daily NIL NIL NIL NIL

Minimum
Balance
Requirement
4 Minimum Metro Branches – Rs.10,000/-
Monthly Urban Branches -- Rs.5000/-
Average Semi Urban Brs – Rs.2000/-
Balance Rural Branches – Rs.2000/-

Benefits & Concessions will be linked to the tierised a/c based on the MAB maintained in the account.

5. Charges for 1. Metro Branches: Rs.200/- per month, for MAB less than Rs. 10000/-
Non- 2. Urban Branches:
Maintaining Rs. 150/- per month, for MAB less than Rs. 5000/-
Average 3. Semi Urban Branches: Rs. 100/- per month, for MAB less than Rs. 2000/-
Quarterly 4. Rural Branches: Rs. 100/- per month, for MAB less than Rs. 2000/-
Balance
6. Issuance of 50 Cheque Leaves – 50 Cheque Leaves – No Charges to apply till No Charges to apply till
cheque First Time free every year year +25 the customer is Diamond the customer is Diamond
books Afterwards, Cheque Leaves per or Platinum category for or Platinum category for
chargeable as per Month- Free issuance of cheque book issuance of cheque book
service charge
circular Afterwards,
chargeable as per
service charge
circular
7. Account
Maintenance In the first year, No charge is to be levied. Thereafter Rs. 50/- plus GST per month, when the MAB is
Charges below Rs. 50,000/- during preceding month.

283
8. Cash At Home & Non- At Home & Non- At Home & Non- At Home & Non-
Deposit Home Branches: Home Branches: Home Branches: Home Branches:
(Base & The daily cash deposit The daily cash deposit The daily cash deposit The daily cash deposit
Non Base limit is proposed to be limit is proposed to be limit is proposed to be limit is proposed to be
Branches) maximum Rs. 2.00 maximum Rs. 5.00 lakhs maximum Rs. 10.00 maximum Rs. 20.00
lakhs per day free and per day free and will be lakhs per day free and lakhs per day free and
will be exempted from exempted from cash will be exempted from will be exempted from
cash handling charges. handling charges. cash handling charges. cash handling charges.

Above the limit as Above the limit as Above the limit as Above the limit as
prescribed for daily prescribed for daily prescribed for daily prescribed for daily
deposits, the charges deposits, the charges deposits, the charges deposits, the charges
applied would be applied would be applied would be applied would be
Chargeable Rs.1/- per Chargeable Rs.1/- per Chargeable Rs.1/- per Chargeable Rs.1/- per
Rs.1000 or part thereof. Rs.1000 or part thereof. Rs.1000 or part thereof. Rs.1000 or part thereof.

Cash Deposit at Cash Deposit at Cash Deposit at Cash Deposit at

BNA/CDK – Free BNA/CDK – Free BNA/CDK – Free BNA/CDK – Free

9 Cash At Home Branches: At Home Branches: At Home Branches: At Home Branches:

Withdrawal Up to 20 Cash Up to 30 Cash Withdrawal Up to 50 Cash Withdrawal Up to 75 Cash Withdrawal
(Base & Withdrawal in a Month: in a Month: No Charges in a Month: No Charges in a Month: No Charges
Non Base No Charges (Free) (Free) (Free) (Free)
Branches)

At Non Home Branches: At Non Home Branches: Non Home Branches: At Non Home Branches:
Up to 5 Cash Withdrawal Up to 5 Cash Withdrawal in Up to 5 Cash Withdrawal in Up to 5 Cash Withdrawal in
in a Month with a cap of a Month with a cap of a Month with a cap of a Month with a cap of
withdrawal of Maximum withdrawal of Maximum up withdrawal of Maximum up withdrawal of Maximum up
up to Rs.50,000/- per to Rs.1,00,000/- per to Rs.1,00,000/- per to Rs.1,00,000/- per
occasion. (Free) occasion. (Free) occasion. (Free) occasion. (Free)

Afterwards, per Afterwards, per withdrawal Afterwards, per withdrawal Afterwards, per withdrawal
withdrawal will be will be charged Rs.150/- for will be charged Rs.150/- for will be charged Rs.150/-
charged Rs.150/- for maximum permissible limit maximum permissible limit for maximum permissible
maximum permissible of Rs.1,00,000/- per of Rs.1,00,000/- per limit of Rs.1,00,000/- per
limit of Rs.50,000/- per occasion. occasion. occasion.
occasion. (

10 Transfer of FREE FOR ALL ACCOUNTS

funds
amongst CBS
Branches
through BOI
Cheque
11 Collection of
Cheques As per the Service
Charges Circular Nil Charges-on Nil Charges-on Nil Charges- on
collection of cheques collection of cheques collection of cheques

12 Issue of As per the service Nil charges for making of

Demand charges circular 10 DD/Pay DDs Nil charges for issue of DD
Drafts /Pay Order/Bankers Cheque
slip/ Banker’s (Per Month)-
cheque
Free
Afterwards-As per the
Service Charges
Circular to apply.
13 Revalidation / As per the Service Nil Charges on revalidation
Cancellation Charges Circular As per the Service Nil charges on of DDs
of Drafts Charges Circular revalidation of DDs

14 Issuance of As per the Service Nil Charges for issuance of

Duplicate Charges Circular As per the Service Nil Charges for issuance duplicate DDs
Demand Draft Charges Circular of duplicate DDs
284
15 RTGS –
Outward As per service As per service charges Free ( Nil charges apply) Free ( Nil charges apply)
through charges circular circular
branch
16 Processing No waiver proposed 100% waiver of processing
Charges 50% waiver of charges 100% waiver of processing
waiver on processing charges charges
Retail Loans

17 Statement of
Account Monthly Account Monthly Account Monthly Account Monthly Account Statement:
Statement – Once in a Statement: Twice in a Statement: Twice in a Twice in a Month- Free
Month-Free Month- Month- Free Thereafter chargeable as per
Thereafter chargeable Thereafter chargeable Thereafter chargeable as the Service Charges Circular
as per Service as per the service per the service charges
Charges Circular charges circular Circular

18 Credit Card One credit card -Either Any one Credit card One credit card -Either Any one Credit card
. Visa Gold or Rupay Visa Platinum or Rupay Either Visa Platinum or
Platinum depending on Either Visa gold card or Select depending on the Rupay Select depending on
the customer’s choice- Rupay Platinum customer’s choice the customer’s choice

(Subject to fulfilment (Subject to fulfilment of (Subject to fulfilment of

of eligibility criteria. (Subject to fulfilment of eligibility criteria. Issuance eligibility criteria. Issuance
Only Issuance eligibility criteria. Only Charges and annual Charges and annual
Charges are Waived) Issuance Charges are maintenance are Waived) maintenance are Waived)
Waived)
19
One ATM Card Free: One ATM Card Free One ATM Card Free One ATM Card Free
Either Rupay NCMC Either : Rupay Platinum or Either Rupay Select or Either Rupay Select or Visa
or Visa Classic card Visa Platnium Visa Business Signature

Issuance Charges Issuance Charge – Issuance Issuance Charge Free

:Free Free Charge Free

Renewal Charges: As Renewal Charges – Renewal Charge –

per the Service 50% of the normal Renewal Charge
Free
Charges Circular to applicable charge – Free
apply
ATM- cum –
Debit Card
Access to BOI ATM : Access to BOI ATM : Access to BOI ATM :
Unlimited Transactions Unlimited Access to BOI ATM :
Unlimited Transactions Unlimited Transactions
(financial + non- Transactions (financial (financial + non-financial) –
financial) – 10 + non-financial) – 10 (financial + non-
financial) – 10 10

Access to Other Bank’s

Access to Other Access to Other ATM : 3 in 6 metro and 5
Bank’s ATM : 3 in Bank’s ATM : 3 in 6 Access to Other in other centers
6 metro and 5 in metro and 5 in other Bank’s ATM : 3 in 6 Transactions (financial +
other centers centers Transactions metro and 5 in other non-financial) – Free
Transactions (financial + non- centers Transactions
(financial + non- financial) – Free (financial + non-
financial) – Free financial) – Free

20 Free
Mobile Alerts
Free Free Free
21 Mobile : Free Free
Banking Free Free
22 RTGS/NEFT Free
outward Free Free
Free
through
Internet
banking
23 Waiver on Free for 1st Year

285
AMC charges Free for 1st Year Free Free
on Demat A/c
for 1st Year

Note: Please refer the latest HOBC for any additional details

29. SCHEME CODES USED IN FINACLE FOR DIFFERENT TYPES OF

CURRENT ACCOUNTS

SCHM Code Scheme Name

CD201 - CURRENT - GENERAL
CD202 - RFC (DOMESTIC)
CD203 - EEFC SCHEME
CD204 - EEFC FOR OTHER BRANCHES
CD205 - CURRENT - DEPOSITS NRO
CD206 - CURRENT - DEPOSIT NRE
CD207 - EDISCD
CD208 - PDSCD
CD209 - CURRENT - COLLECTION NC
CD210 - CDEXTR
CD211 - CURRENT - INSTITUTIONAL
CD212 - VOSTRO ACU USD
CD213 - VOSTRO ACCOUNTS BANKS
CD214 - VOSTRO ACCOUNTS PEHS
CD215 - VOSTRO ACCOUNTS BRANCHES
CD216 - DIVIDEND WARRANTS PAYMENT
CD217 - DIVIDEND WARRANTS PAYMENT
CD218- INTEREST WARRANT PAYMENTS
CD219- CURRENT ACCOUNT IN FC
CD221 - DIAMOND DOLLAR ACCOUNTS
CD222 - PAYMENT OF TAX - OUR BANK
CD223 - PAYMENT OF TAX - OUR BANK
CD249 - CURRENT – NSE

286
 APPENDIX I
(Paragraph 4.2)
DECLARATION AND UNDERTAKING TO BE OBTAINED FROM CURRENT
ACCOUNT-HOLDER (COMPANIES/FIRMS) NOT HAVING ANY
BORROWING/BANKING FACILITY WITH ANY OTHER BRANCH/BANK

Date:

To,
The Branch Manager,
Bank of India,
_________________________Branch/Office

Dear Sir,

With reference to my/our application dated________________________for opening

current account in your bank, I/We confirm and declare that I/We do not have any
advance or other banking facility from any branch of your bank or of any other bank and
I/We undertake that I/We shall not obtain any advance or other banking facility from any
other branch of your bank or of any other bank without giving to you prior written notice.

Yours faithfully,

(Authorised Signatories)

(To be signed by all Partners of a firm/to be signed by authorised Directors of a Limited

Company)

287
 APPENDIX II
(Paragraph 4.2)

DECLARATION AND UNDERTAKING TO BE OBTAINED FROM CURRENT

ACCOUNT HOLDER (COMPANIES/FIRMS) HAVING BORROWING/BANKING
ARRANGEMENT WITH THE BANK / OTHER BANKS

Date:
To,
The Branch Manager,
Bank of India,
________________________Branch/Office

Dear Sir,

With reference to my/our application dated_______________________for opening

current account with your Bank, I/We furnish below the details of all borrowings/banking
arrangements made by us with your bank as well as other banking institutions:

Name of the Bank and Nature and details of banking / borrowing

Address arrangement

We confirm and declare that the above are all the existing banking/borrowing
arrangements made by us. We undertake to furnish to you promptly details of any
changes in respect of the above and/or any other information in this connection, which
may be required by you.

Yours faithfully,

(Authorized Signatory)

(To be signed by all Partners of a firm/to be signed by authorized Directors of a Limited

Company.)

288
 APPENDIX III

(Paragraph 9.5)
Specimen of Register of Statements dispatched to Account Holders
Account Title of the January February March April May June July August September Remarks
Number Account

A1 Amit & Co. 1 2 2 1 and so on

A2 Attract & 2 2 2 1 and so on

Co.
A3 A. V. & Co. 2 2 2 3 and so on

A4 A. X. & Co. 3 3 2 5 and so on

Year______

Instructions:

1. The record may be kept ledger-wise and period-wise either in the same register/pass
book or by using separate registers/pass books.

2. Cut sheets containing twelve months (from January to December) may be provided in
the register/ pass book as per the requirements of the Branch, preferably for five years.
The cut sheets may be provided on the lines of the existing Daily Extract of Overdraft
Balances (Form OD 145). The columns may, however, be provided as per the
specimen.

3. The dates on which the statements (for previous month) are sent to the customer may
be mentioned in the appropriate month-wise columns provided in the register/pass
book.

4. In the case of monthly statements, all endeavors should be made to send the
statements to the customers before the 5th of the subsequent months.

5. A similarly ruled register/pass book may be maintained for other periodical statements
of accounts.

289
 APPENDIX IV
(Paragraph 11.1)

Specimen of letter of Undertaking for return of Paid Cheques to be obtained

from Account Holders

On stamped paper of
appropriate value Place;
Date:
To,
Bank of India,
______________________Branch

Dear Sirs,

Re. : Our Current Account with your branch at..........................

In consideration of your having, at our request, agreed to return to us each

week/month cheques drawn by us on your Branch at......................, we hereby
undertake and agree with you as follows:

(1) We shall confirm the balance whenever called upon by the Bank to do so.
(2) We shall give you a receipt and acknowledgement for the cheques delivered each
week/month in the prescribed form.
(3) We shall keep the said cheques safe and secure for a period of at least eight years
from the date of their payment.
(4) We shall not part with the said cheques except when required by law.
(5) We shall produce the said cheques before the Income Tax Authorities whenever
called upon to do so.
(6) We agree to indemnify you against any losses, damages, costs, expenses, etc., you
may incur or be put to by reason of your acting upon our request as above.

Yours faithfully,

________________
(Authorized Signatories)

290
 APPENDIX V

Specimen of First Letter of Advice - Inoperative Accounts

Ref. No.
Date.........................

_________________________________________
_________________________________________
_________________________________________

Dear Sir/Madam,

Re: Your Current Account

1. We observe that your current account has been dormant for some time and your
balance at the close of business today is Rs........................in your favor.

2. We trust that it is not your desire to cease banking with us and we would be very glad
if you would resume deposits in and withdrawals from your account.

3. If the account does not suit your immediate needs, we will endeavor to meet your
requirements if you will very kindly communicate with us.

Yours faithfully,

__________________
Manager

291
 APPENDIX VI

Specimen of Second Letter of Advice - Inoperative Accounts

Ref. No.

Date..........................

_________________________________________
_________________________________________
_________________________________________

Dear Sir/Madam,

Re.: Your Current Account

We observe that your current account has been dormant for some time and your
balance at the close of business today is Rs._____________in your favor.

2. We trust that it is not your desire to cease banking with us and we would be
very glad if you would resume deposits in and withdrawals from your account.

3. If the account does not suit your immediate needs, we will endeavor to meet
your requirements if you will very kindly communicate with us.

4. Should you, however, have decided definitely to discontinue making use of

your account with us, we should be glad if you would please instruct us regarding the
disposal of the balance standing to your credit and return to us the unused cheque
forms in your possession.

Yours faithfully,

________________
Manager.

292
 APPENDIX – VII

Specimen Statement of current Accounts Opened/Maintained in the Names of

Close Relatives of Staff Members

BRANCH FOR THE QUARTER ENDED

Name of Account Account Activity Constitution Name(s) of Remarks on conduct of Account such as
the opened on introduced by Proprietor/Partners/ Minimum & Maximum balance, cheques
Account Directors and returned unpaid if any, and reasons
particulars of staff therefor, over limit granted if any etc.
member who is a close
relative of the
Proprietor/Partner/Direc
tor & nature of
relationship

293
 APPENDIX - VIII

Specimen of Register of Temporary overdrafts

NO. CD - 28

Date Name of Date of Account Amount of Amount No. of Times Initial Date A/c Initial Remarks
of Account opened Cheque Overdrawn TOD given in Put in
TOD (Rs.) (Rs.) last 3 months order

294
 APPENDIX - IX

Statement of Temporary Overdrafts

BR-3 (A)
BRANCH:
FOR THE MONTH ___________20
Date of Name of Date Amount of TOD allowed (Rs.) Sanctioning
TOD Account Account cheque Authority & Date
opened

Maximum Period for which Balance as Details of Temporary Remarks (state

permissible the TOD is given on the date of Overdrafts given during last the reasons for
TOD (as reporting Rs. three months TOD and steps
per Dr. No. of times Maximum taken for recovery.
delegation) given Overdrafts (Rs.) Also specify Over
(Rs.) limit, other
deposits/facilities
and outstanding
therein, if any)

NOTE: Separate statements to be submitted for reporting Temporary

Overdrafts/Over limits.

295
 Appendix X
CUSTOMER UNDERTAKING FOR TAGGING NEW CURRENT ACCOUNT
TO HIGHER END VARIANT
(Most Important Document- For Opening / Tagging New Account to Gold/
Diamond/ Platinum) (For New Accounts Only)
To:
The Branch Manager,
Bank of India,
____________________Branch

I/We wish to open New Current Account in one of the following Variant. (pls. tick)

Normal Gold

Diamond Platinum

Upon the Bank opening my a/c to above product variant I/We accept that I/We am/are
required to maintain an Average Quarterly Balance (AQB) for the new variant selected
above as per the following tierisation, in my/our account.

Variant Normal Gold Diamond Platinum

Monthly Average Upto Rs 50,000 Above Rs 50,000 Above Rs 2,00,000 Above Rs 10,00,000
Requirement to Rs 2,00,000 upto Rs 10,00,000

I / We have understood the benefits and privileges of each variant of the accounts from
you and also understood that non-maintenance of balance in my / our account, as per
the newly selected variant, may result in levy of MAB non-maintenance charges as
without any separate notice.

I/We confirm that I/we have read schedule of charges of the new (switched) variant.
I/We have read and understood the features and the schedule of charges of the above
variant and accept the terms & conditions prescribed by the bank for maintaining
Current Account as above.

I authorize the Bank to tag the account even at higher level without giving any further
notice to me and I confirm that I shall be bound by the respective terms and conditions
of such variant . I also understand that schedule of service charges are subject to
change from time to time at the discretion of the bank, and a notice given in the Bank’s
website would be deemed to be service of proper notice to me/us.
296
_________________________________________
_________________________________________

(Signature of the Customer/Authorized Signatory 1) (Signature of the

Customer/Authorized Signatory 2)

(to be signed by authorized signatory / signatories as per the mode of

operation.)

FOR BANK USE:

On the basis of the undertaking & declaration provided by the customer, a/c no.
_________________has been tagged as ___________CD A/C on date______

Date______________________ Bank Officer Signature ____________________

Approved by Branch Head : ______________________________

___________________________

(Sign)
(Employee code)
297
 Appendix XI

CUSTOMER UNDERTAKING FOR SWITCHING CURRENT ACCOUNT VARIANT

WITHOUT CHANGE OF ACCOUNT NUMBER
(Most Important Document- For Switching Account to Gold / Diamond/ /
Platinum/ Platinum Plus)
To:
The Branch Manager,
Bank of India,
____________________Branch

I/We _____________________________________________________ (Title of the

A/C) wish to switch over our existing current account, bearing account number
______________________________ (please enter your 15 digit current account
number) from our existing Current Account viz; Normal Current Account to one of the
following Variant as chosen by me/us. (pls. tick)

Gold Diamond Platinum

Upon the Bank switching over my a/c to above product variant I/We accept that I/We
am/are required to maintain an Average Quarterly Balance (AQB) for the new variant
selected above as per the following tierisation, in my/our account.

Variant Gold Diamond Platinum

Monthly Average Above Rs 50,000 Above Rs 2,00,000 Above Rs 10,00,000

Requirement to Rs 2,00,000 upto Rs 10,00,000

I / We have understood the benefits and privileges of each variant of the accounts
from you and also understood that non-maintenance of minimum balance as stated
above in my / our account, as per the newly selected variant, should result in levy of
MAB non-maintenance charges without any separate notice and authorize you to
debit the same from our/my account.

I/We confirm that I/we have read schedule of charges of the new (switched) variant. .
I/We have read and understood the features and the schedule of charges of the above
variant and accept the terms & conditions prescribed by the bank for maintaining
Current Account as above.

I also understand that schedule of service charges are subject to change from time to
298
time at the discretion of the bank, and a notice given in the Bank’s website would be
deemed to be service of a proper notice to me/us

_________________________________________
______________________________________
(Signature of the Customer/Authorized Signatory 1) (Signature of the
Customer/Authorized Signatory 2)

(to be signed by authorized signatory / signatories as per the mode of

operation.)

FOR BANK USE:

On the basis of the undertaking & declaration provided by the customer, a/c no.
_________________has been tagged as ___________CD A/C on
date_____________.

Employee code________________________ Place

_________________________________

Date______________________ Bank Officer Signature

____________________

Approved by Branch Head: ______________________________

___________________________
(Sign)
(Employee code)

299
 Appendix XII

CUSTOMER UNDERTAKING FOR SWITCHING CURRENT ACCOUNT OF HIGHER

END VARIANT TO NORMAL CURRENT ACCOUNT
(Most Important Document- For Switching Account under Silver/ Gold/ Gold
Plus/ Diamond/ Diamond Plus/ Platinum/ Platinum Plus to Normal Current
Account)

To:
The Branch Manager,
Bank of India,
____________________Branch

I/We _____________________________________________________ (Title of the

A/C) wish to switch over our existing current account, bearing account number
______________________________ (please enter your 15 digit current account
number) from our existing Current Account categorized by system, as Silver/ Gold/
Gold Plus/ Diamond/ Diamond Plus/ Platinum/ Platinum Plus (pls. tick) to Normal
Current Account and request you for the same.

Upon switching to Normal Current Account, I/We have understood that the system will
block auto tierisation and will continue the account as Normal Current account despite
maintenance of higher AQB. The Bank may allow auto tierisation only upon a specific
request made by me/us in this regard on the terms as decided by the Bank from time
to time. I/We am/are required to maintain an Average Quarterly Balance (AQB) which
is prescribed by the Bank for its Normal Current Account.

Parameter Metro Branch Urban Semi Urban Rural

Branch Branch Branch
AQB Rs.10000/- Rs.2500/- Rs.2500/- Rs.1000/-
Requirement
Charges per
Quarter for Non – Rs.600/- Rs.500/- + Rs.500/- + Rs.350/-
Maintenance of +Applicable Applicable Applicable +Applicable
AQB service tax service tax service tax service tax

I / We have understood the benefits and privileges of each variant of the accounts from
you and also understood that non-maintenance of the minimum balance as stated
above in my / our account, as per the newly selected variant, should result in levy of
AQB non-maintenance charges without any separate notice to me/us and we agree and
authorize you to debit the same from my/our account.

I/We confirm that I/we have read schedule of charges of the new (switched) variant. .
I/We have read and understood the features and the schedule of charges of the above
variant and accept the terms & conditions prescribed by the bank for maintaining
Current Account as above.
300
I also understand that schedule of service charges are subject to change from time to
time at the discretion of the bank, and a notice given in the Bank’s website would be
deemed to be service of a proper notice to me/us

_________________________________________
_________________________________________
(Signature of the Customer/Authorized Signatory 1) (Signature of the
Customer/Authorized Signatory 2)
(To be signed by authorized signatory / signatories as per the mode of
operation.)

FOR BANK USE:

On the basis of the undertaking & declaration provided by the customer, a/c no.
_________________has been tagged as ___________CD A/C on
date_____________.

Employee code________________________ Place

_________________________________

Date______________________ Bank Officer Signature

____________________

Approved by Branch Head: ______________________________

___________________________
(Sign)
(Employee code)

301
 Appendix XIII

CONSENT LETTER FOR CONVERTING BOI Savings Plus Account/BOI Current

Deposit Plus Account into Normal Account

Present Communication Address Permanent Address:

______________________________
________________________________
______________________________
________________________________
______________________________
________________________________

Date:
The Assistant General Manager /
Chief Manager / Senior Branch Manager /
Branch Manager
Bank of India,
_____________ Branch

Dear Sir / Madam,

Conversion of my BOI Savings Plus Account/BOI Current Deposit Plus Account
into Normal Account
I/We refer to the notice regarding modifications in certain parameters of BOI
savings plus account/BOI current deposit plus account displayed on Bank’s website.
I request you to consider converting my existing BOI Savings plus Account/BOI Current
Deposit plus Account (No: _______________________) into normal Savings Bank
Account/Current Account. I am aware that after conversion of my BOI savings plus
account/BOI current deposit plus account to normal account, my account and the FFDs
shall not be linked and accordingly upon maturity of the FFD the same may be renewed
as a normal FD for ----- months/* ------ yrs /*the proceeds be credited to my SB/current
a/c..
Thanking you,

Signature
Full Name:_________________
Contact Number:_________________
Email Id:__________________

302
The new current accounts shall be opened at ZCOD level only and the branches are
not permitted to open current accounts at their level. Needless to mention here that the
ZCODs to ensure quick TAT while opening the new current accounts (Ref.Cir.lr.
No.2021-22/38 Ref.GOD:VK:2021-22:12 dated 17.08.2021)

STANDARD OPERATING PROCEDURE (SOP)

Opening of Current Accounts by Banks - Need for Discipline

(As per Cir.Lr. 2022-23/26 Ref.HO: GOD:SEM:2022-23:07 dtd. 19.05.2022)

Keeping in view the importance of credit discipline in banking system, especially in

reduction of NPA levels in banks and to curb diversion of borrowed funds, Reserve
Bank of India has issued various guidelines last such circular Ref no. RBI/2022-23/27
DOR.CRE.REC.23/21.08.008/2022-23 on Opening of Current Accounts & CC/OD
Accounts by Banks.
Therefore, there is a need of having Standard Operating Procedure (SOP) in place on
detail procedure, guidelines and due diligence to be followed by branches while any
entity (ies) / borrower approaches for opening of current accounts.
A. Borrower having Cash Credit / Overdraft Facilities from the Banking System
(a) Where the aggregate exposure of the banking system is less than ₹ 5 crore
Branches can open current accounts of customer without any restrictions subject to
obtaining an undertaking (Annexure-1) from such customers that they (the borrowers)
shall inform the branch, if and when the credit facilities availed by them from the banking
system becomes
₹ 5 crore or more.
(b) Where the aggregate exposure of the banking system is ₹5 crore or more
i. Borrowers can open current accounts with any one of the banks with which it has
CC/OD facility, provided that the bank has at least 10 per cent of the aggregate
exposure of the banking system to that borrower.
ii. In case none of the lenders has at least 10 per cent of the aggregate exposure, the
bank having the highest exposure among CC/OD providing banks may open
current accounts.
iii. Other lending banks may open only collection accounts subject to the condition that
funds deposited in such collection accounts will be remitted within two working days
of receiving such funds, to the CC/OD account maintained with the bank.
iv. The balances in such collection accounts shall not be used for repayment of any
credit facilities provided by the bank, or as collateral/ margin for availing any fund
or non-fund based credit facilities. However, banks maintaining collection accounts
are permitted to debit fees/ charges from such accounts before transferring funds
to CC/OD account
v. Non-lending banks are not permitted to open current/ collection accounts.

B. Borrowers having no Cash Credit/ Overdraft Facilities from the Banking System
(a) Where the aggregate exposure of the banking system is ₹50 crore or more
Branches may open current accounts by adhering to below guidelines: -
303
 i. All lending banks shall put in place an escrow mechanism i.e. all lending banks
shall be part of the escrow agreement. The terms and conditions of the
agreement may be decided mutually by lending banks and the borrower.
ii. Borrower shall free to choose any lending bank as their escrow managing bank
and can open / maintain current accounts with it.
iii. However, there is no restriction on opening of 'collection accounts' by other
lending banks subject to the condition that funds will be remitted from these
accounts to the said escrow account at the frequency agreed between the bank
and the borrower.
iv. Further, balances in such collection accounts shall not be used for repayment of
any credit facilities provided by the bank, or as collateral/ margin for availing any
fund or non-fund based credit facilities.
v. There is no prohibition on amount or number of credits in 'collection accounts',
debits in these accounts shall be limited to the purpose of remitting the proceeds
to the said escrow account. However, banks maintaining collection accounts are
permitted to debit fees/ charges from such accounts before transferring funds to
the escrow account.
vi. Non-lending banks shall not open any current account for such borrowers
(b) Where the aggregate exposure of the banking system is ₹5 crore or more but less
than ₹50 crore
i. There is no restriction on opening of current accounts by the lending banks
ii. However, non-lending banks may open only collection accounts as detailed at para
B (a) above.

(C) Where the aggregate exposure of the banking system is less than ₹5 crore
i. Branches can open current accounts of customer without any restrictions subject to
obtaining an undertaking (Annexure) from such customers that they (the borrowers)
shall inform the bank/branch, if and when the credit facilities availed by them from the
banking system becomes ₹5 crore or more.
ii. The current account of such customers, as and when the aggregate exposure of the
banking system becomes ₹5 crore or more, and ₹50 crore or more, will be governed by
the provisions of para B (b) and para B (a) respectively.

C. Customers who have not availed any credit facilities from the Banking System
Branches are free to open current accounts of prospective customers who have not
availed any credit facilities from the banking system, after complying with the extant
KYC and due diligence guidelines.
Branches are free to open current accounts, without any of the restrictions placed in
this SOP, for borrowers having credit facilities only from NBFCs/ Fls/ co-operative
banks/ nonbank institutions, etc. However, if such borrowers avail aggregate credit
facilities of Z5 crore or above from the banks covered under these guidelines
(Scheduled Commercial Banks and Payments Banks), the provisions of the SOP shall
be applicable.

D. Exemptions Regarding Specific Accounts

Branches are permitted to open and operate the following accounts without any of the
restrictions placed in terms of paras A, B and C of this SOP.
304
(a) Specific accounts which are stipulated under various statutes and specific
instructions of other regulators/ regulatory departments/ Central and State
Governments.
An indicative list of such accounts is given below: -
i. Accounts for real estate projects mandated under Section 4 (2) I (D) of the Real
Estate (Regulation and Development) Act, 2016 for the purpose of maintaining 70
per cent of advance payments collected from the home buyers. ii. Nodal or escrow
accounts of payment aggregators/ prepaid payment instrument issuers for specific
activities as permitted by Department of Payments and Settlement Systems
(DPSS), Reserve Bank of India under Payment and Settlement Systems Act, 2007.
iii. Accounts for the purpose of IP0/ NFO/ FPO/ share buyback/ dividend payment/
issuance of commercial papers/ allotment of debentures/ gratuity etc. which are
mandated by respective statutes or by regulators and are meant for specific/ limited
transactions only.
(b) Accounts opened as per the provisions of Foreign Exchange Management Act, 1999
(FEMA) and notifications issued thereunder including any other current account if it is
mandated for ensuring compliance under the FEMA framework.
(c) Accounts for payment of taxes, duties, statutory dues, etc. opened with banks
authorized to collect the same, for borrowers of such banks which are not authorized to
collect such taxes, duties, statutory dues, etc.
(d) Accounts for settlement of dues related to debit card/ ATM card/ credit card issuers/
acquirers
(e) Accounts of White Label ATM Operators and their agents for sourcing of currency
(f) Accounts of Cash-in-Transit (CIT) Companies/ Cash Replenishment Agencies
(CRAs) for providing cash management services
(g) Accounts opened by a bank funding a specific project for receiving/monitoring cash
flows of that specific project, provided the borrower has not availed any CC/OD facility
for that project
(h) Inter-bank accounts
(i) Accounts of All India Financial Institutions (AIFIs), viz., EXIM Bank, NABARD, NHB,
and SI DBI
(j) Accounts attached by orders of Central or State governments/ regulatory body/
Courts/ investigating agencies etc. wherein the customer cannot undertake any
discretionary debits. Branches maintaining accounts listed in para D shall ensure that
these accounts are used for permitted/ specified transactions only. Further, Branches
shall flag these accounts in the CBS for easy monitoring. Lenders to such borrowers
may also enter into agreements/ arrangements with the borrowers for monitoring of
cash flows/ periodic transfer of funds (if permissible) in these accounts.

E. Other Instructions
(a) All banks, whether lending banks or otherwise, shall monitor all accounts regularly,
at least on a half-yearly basis, specifically with respect to the aggregate exposure of the
banking system to the borrower, and the bank's share in that exposure, to ensure
compliance with above revised instructions. If there is a change in exposure of a
particular bank or aggregate exposure of the banking system to the borrower which
warrants implementation of above new banking arrangements, such changes shall be
implemented within a period of three months from the date of such monitoring.
305
(b) Branches / Zones shall put in place a monitoring mechanism to monitor non-
disruptive implementation of the RBI revised instruction on opening of current accounts
and to ensure that customers are not put in undue inconvenience during the
implementation process.

(c) Banks should not route drawal from term loans through CC/ OD/ Current accounts
of the borrower. Since term loans are meant for specific purposes, the funds should be
remitted directly to the supplier of goods and services. In cases where term loans are
meant for purposes other than for supply of goods and services and where the payment
destination is identifiable, banks shall ensure that payment is made directly, without
routing it through an account of the borrower. However, where the payment destination
is unidentifiable, banks may route such term loans through an account of the borrower
opened as per the provisions of the RBI circular. Expenses incurred by the borrower for
day-to-day operations may be routed through an account of the borrower.

Note:

• "Exposure" for the purpose of these instructions shall mean sum of sanctioned fund
based and non-fund-based credit facilities availed by the borrower. All such credit
facilities carried in their Indian books shall be included for the purpose of exposure
calculation.

• In case of proprietary firms, the aggregate exposure shall include all the credit facilities
availed by the borrower, for business purpose or in personal capacity.

• Branches may compute the aggregate exposure based on the information available
from Central Repository of Information on Large Credits (CRILC), Credit Information
Companies (CICs), National E-Governance Services Ltd. (NeSL), etc. and by obtaining
customers' declaration, if required.

• "Banking System" for the purpose of these instructions, shall include Scheduled
Commercial Banks and Payments Banks only.

306
307
 Annexure
DECLARATION AND UNDERTAKING
TO BE OBTAINED FROM THE CUSTOMERS FOR OPENING OF CURRENT
ACCOUNT

Date:

To,
The Branch Manager,
Bank of India,
Branch/Office

Dear Sir,

With reference to my/our application dated for opening

current account in your bank, I/We confirm and declare that

I/We do not have any advance or other banking facility from any branch of your
bank or of any other bank and undertake that II\Ne shall not obtain any advance or
other banking facility from any other branch of your bank or of any other bank
without giving to you prior written notice.

OR

I/We furnish below the details of all borrowings/banking arrangements made by

us with your bank as well as other banking institutions and undertake that I/We shall
inform the bank, the details of any changes in respect of the borrowings/banking
arrangements made by us and/ or any other information in this connection which
may be required by you.

I/We undertake that I/We shall inform the bank/branch, if and when the credit
facilities availed by me/us from the banking system becomes ₹5 Crore or more, and
₹50 Crore or more. Yours faithfully,

(Authorised Signatories)

(To be signed by all Partners of a firm/to be signed by authorised Directors of a Limited Company)

308
 CHAPTER 4 -Savings Bank Accounts

1.1 Savings Bank accounts, as the very name suggests, are intended for savings
for the future. These accounts promote savings habit of people. Balances in this type
of account earn interest. There is no restriction on the number and amount of deposits
to be made on any one day and any small amount. (Exception for simplified KYC
accounts) The amount from the account can be withdrawn when needed.

1.2 The term "savings bank accounts" referred to in this Chapter includes both the
categories of savings accounts, viz. savings accounts with cheque book facility and
savings accounts without cheque book facility. Instructions in this Chapter are equally
applicable to both these categories of savings accounts unless the context indicates
to the contrary.

2. Introduction of Accounts

Introduction is not mandated for opening of saving bank account.

To facilitate the branch managers to aggressively canvass for low cost savings
bank deposit account(s) and to compete with other players in the market place,
some flexibility is given. Branches may open Savings Bank account of depositor
against production of any one of the 6 officially valid documents evincing the Proof
of Identity(PoI) & Proof of Address(PoA) or any other document as enumerated
below:-

OVDs

i. Aadhaar Card – both as PoI & PoA

ii. Election Identity Card – both as PoI & PoA
iii. Pass port– both as PoI & PoA if within validity
iv. Letter issued by the National population Register containing details of name
and Address - both as PoI & PoA
v. Driving Licence – both as PoI & PoA if within validity
vi. MNREGA Job CARD – both as PoI & PoA Simplified Documents

The official opening the account should obtain photocopy of document and
certify with the original. The officer should certify having verified the original
document under signature with code number.
309
 If the depositor provides his CKYC number, it is not mandated, to obtain the
KYC documents but the details pertaining to his CKYC should be kept on record
& also filled in the application form.

In case the depositor does not have any valid documents as specified above,
the official may open the saving bank account known as Small Accounts on
declaration basis of the depositor. The depositor has to be informed about the
restrictions of these accounts and also that he/she has to provide documents
evincing his KYC details as specified in the para 2.1

In addition to the above, a depositor may choose to open his account in

electronic mode at branches or through digital modes (within the geographical
limit of India)

3. Types of Accounts
3.1 Savings bank accounts may be opened in the names of:

(i) Individual - Single Accounts

(ii) Two or more individuals Joint Accounts
(iii) Illiterate Persons
(iv) Blind Persons
(v) Minors
(vi) Associations, Clubs, Societies, etc.
(vii)Trusts
(viii)Institutions/ Agencies specifically permitted by the Reserve Bank of India
(also refer paragraph No.4)
(ix) HUF
Refer to the banks customer acceptance policy revised from time to time.

3.1.1 Savings bank account cannot be opened by banks in the names of

 Government departments.
 Bodies depending upon budgetary allocations for performance of their
functions
 Panchayat Samitis
 State Housing Boards
 State Electricity Boards
 Industrial Development Authorities
 Water and Sewerage /Drainage Boards
 State Text Book Publishing Corporations/Societies
310
  Metropolitan Development Authority
 State/District Level Housing Co-op. Societies, etc.
 Any trading, business or professional concern (e.g. firms of Chartered
Accountant, Lawyer etc.) whether such concern is a proprietary or a
partnership firm for a company or an association.
 Political Party
 Other banks including Regional Rural Banks, Co-Operative Banks and
Land Development Banks.

For detailed instructions for dealing with these accounts, refer Chapter 2 on Deposits
General.

3.2 Savings bank accounts of military units may be opened for the funds of Regimental
Units which mainly consist of contributions from individual members of the unit, income
from Regimental properties, collections made on Army Day, etc. Balances in such
accounts earn interest as per the rules.

Opening of Savings Bank accounts in the name of certain agencies aiming to

serve the weaker sections of society.

4.1 In terms of the Reserve Bank of India directive, savings bank accounts cannot be
opened in the name of any trading or business concern, whether such concern is a
proprietary or a partnership firm, a company or an association and would not be
eligible for any interest. The Reserve Bank of India, however, has exempted certain
agencies/institutions from this prohibition on account of the socially desirable purpose
of their activities aiming to serve the weaker sections of society. Accordingly, the
following institutions /organizations are eligible for earning interest on their savings
bank accounts on the usual terms:
 Primary Co-operative Credit Society financed by the Bank.
 Small Farmers Development Agency (SFDA)
 Marginal Farmers and Agricultural Labourers Agencies (MFAL)
 Drought Prone Areas Programme (DPAP)
 District Development Authority (DDA)
 Rural Development Agency/Society (DRDA/DRDS)
 Integrated Rural Development Programme (IRDP)
 Integrated Tribal Development Agency (ITDA)
 Agriculture Produce Market Committees
 District Khadi and Village Industries Boards
 Jawahar Rojgar Yojana funds held by Zilla Parishads / Gram Panchayats
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  Fish Farmers Development Agencies (FFDA)
 Development of Women and Children in Rural Areas (DWCRA)
 Swarna Jayanti Gram Swarojgar Yojana
 Self-help Groups (SHG) – registered and unregistered which are engaged
in promoting savings habits among the members

 Farmers’ Clubs – Vikas Voluneer Vahini – VVV

 Nagar Panchayats, Nagar Palikas and Municipal bodies in relation to
funds given as subsidy under Nehru Rozgar Yojanatowards the Scheme of
Urban Micro Enterprises Scheme of Urban Wage Employment. (Provided that
such account is opened only with a public sector bank).
 Societies registered under the Societies Registration Act, 1960 or any other
corresponding law in force in a State or a Union Territory.
 Companies governed by the Companies Act, 1956 which have been licensed
by the Central Government under Section 25 of the said Act or under the
corresponding provision in the Indian Companies Act, 1913 and permitted not
to add to their names the word `Limited' or the words "Private Limited"
 Collector/ District Magistrate /District Commissioner in respect of funds
released for implementation of Member of Parliament Local Area development
Scheme (MPLADS) where the works under the scheme are executed through
the planning Department of the State Government. Public Sector Banks may
also open SB accounts under the said scheme in the name of District Rural
Development Agency (DRDA)
 Institutions other than those listed under para 4.3 below and whose entire
income is exempt from payment of Income Tax Act, 1961.
 Any other institution permitted by the RBI from time to time.

Banks should not maintain even "Interest Free" Savings Bank Accounts of
ineligible entities.

Please carefully note that “acceptance of Interest free deposits in Savings Bank
is prohibited irrespective of caste, creed or religion of the depositor”
4.1-A The Block Development Officer who is acting on behalf of the Agencies such as
district Development Authority/District Rural Development Agency and is charged with
the task of rendering social or economical assistance to, or welfare of the weaker and
underprivileged sections of the society, is eligible to open Savings Bank Account and
earn interest on the account.
4.1-B In terms of the Reserve Bank of India directives, it has been decided to allow
banks to open Savings Bank Accounts in the name of State Government Departments
/ Bodies / Agencies in respect of grants / subsidies released for implementation of
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various programs / schemes sponsored by the State Governments on production of
an authorization to the bank from the respective Government Department certifying
that the concerned Government Department or Body has been permitted to open
Savings Bank Account. While opening such accounts, banks should keep on their
record a copy of the authorization issued by the respective State Government
Department.

RBI has now permitted opening of Savings Bank account in the name of State
Government Departments / Bodies / Agencies also in respect of grants / subsidies, as
stated above, in addition to Central Government Departments / Bodies / Agencies for
similar purpose. All other provisions of RBI directives in the above matter, conveyed
to branches from time to time, remain unchanged.

4.2 There are certain Government Departments, Semi-Government or Quasi-

Government bodies, local bodies and certain organizations engaged in public utility
services e.g. State Housing Boards, State Electricity Boards, etc., which are not liable
to pay income-tax under the Income-tax Act, 1961. However, these institutions /
organizations receive grants, loans or subsidies from the Government and, therefore,
depend on budgetary allocation for performance of their functions. As such they do
not qualify for payment of interest and, hence, savings bank account cannot be
opened in their names. These include local bodies like Municipal Corporations, Zilla
Parishads, Taluka Panchayats and Gram Panchayats.

4.3 In the opinion of the Reserve Bank of India, the following institutions do not qualify
for opening of savings bank account or payment of interest:
- Municipal Corporations/Committees/Panchayat Samitis
- State Housing Boards
- Industrial Development Authorities
- State Electricity Boards
- Water and Sewerage/Drainage Boards
- State Text Books Publishing Corporations / Societies
- Metropolitan Development Authority
- State District Level Housing Co-operative Societies etc.

Although the activities of the institutions of this type are of developmental nature, these
organizations are not specifically serving any economically weaker/underprivileged
sections of the society, and as such they do not qualify for exemption under the Reserve
Bank of India directive.
4.4 Branches should note that it will not be in order to open savings bank accounts in
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the names of such organizations / institutions / agencies / Government Departments,
etc., on usual terms of payment of interest and the Reserve Bank of India will not
entertain any application in respect of them for relaxation.

4.5 The Institutions/Agencies listed under paragraph 4.1 which may be getting funds for
their operation out of budgetary allocation have been specifically allowed to open
Savings Bank accounts with banks and earn interest thereon. For institutions covered
by paras 4.2 & 4.3 above, Bank should not maintain even Interest free Savings Bank
Accounts.

4.6 In addition to these specifically exempted categories of agencies, if Branches desire

to open savings bank accounts in the names of certain institutions and they are fully
satisfied that those institutions satisfy the eligibility criteria, viz: specifically serving any
economically weaker / underprivileged section of the society and that they do not have
to depend on Government grant for their performance, it will be necessary to obtain
prior approval of the Reserve Bank of India for opening of saving bank account in their
names.

For this purpose, application is required to be made to the Reserve Bank of India
furnishing full particulars of the institution along with:

i) Memorandum and Articles of Association,

ii) bye-laws,
iii) details of the nature of activities,
iv) published accounts such as the Balance-Sheet, Profit and Loss
Account or statement of Income and Expenditure,

v) Statement regarding the manner of distribution of surplus funds, etc., to

enable the Reserve Bank of India to decide whether a specific exemption can
be granted in favor of a particular institution or not. Branches should note to
send such information to their respective Zonal Office who will make a formal
application to the Regional Office of the Department of Banking Operations
and Development within whose jurisdiction the registered office of the
beneficiary organization is situated.

4.7 It should be noted that payment of interest on savings bank accounts opened in
the names of institutions, which is not permissible either under the directive or under a
specific exemption granted by the Reserve Bank of India, would involve violation of the
directive of the Reserve Bank of India.
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4.8 Branches should not open Savings Bank Accounts of other banks, including
Regional Rural Banks and Co-operative Banks. Opening and conduct of accounts of
Land Development Banks are governed by the Reserve Bank of India directives (and
not by the IBA Code for banking practice) in terms of which they, being profit making
bodies, are also not eligible to open Savings Bank Accounts.

5. Opening of Accounts

5.1. Opening and Operation of Accounts:

(a) An account may be opened in the name of one person or jointly in the names of
two or more persons.

(b) An Account in the names of two or more persons operated upon by any one or
more or all of them, and the balance made payable to any one or more or all of them
or anyone or more or all of the survivors of them or to the last survivor, as applicable.

(c) The mode of operation of a joint account should be specified at the time of opening
the account and cannot be changed subsequently, without the written consent of all
the joint account-holders.

(d) In a joint account of two persons to be operated upon by 'Either or Survivor' on

the death of any one of them the surviving account-holder alone can operate on and
will be entitled to the balance in the account, the heirs of legal representatives of the
deceased account-holder will have no claim against the Bank. On the death of the
surviving accountholder, his heirs or legal representatives alone will be entitled to
claim the balance from the Bank.
(e) A joint account to be operated upon by 'Former or Survivor' can also be opened.
Where the special instructions relating to the operation of an account reads 'Former or
Survivor' the account shall be operated upon and the cheques/withdrawal forms shall
be drawn by and the balance shall be repayable to the former i. e. the first named
account holder during his/her life time and only after his/her death by and to the second
named account holder if then surviving.
(f) In approved cases, an account may be opened in the names of associations,
clubs, co-operative societies (with the permission of the Registrar of Co-operative
Societies), Trusts or other non-trading Institutions for purposes of depositing savings,
provided the relevant bye laws, rules, etc. are found acceptable to the Bank and are
strictly adhered to and when required a suitable indemnity is given to the Bank.

(g)In the event of death of a sole depositor or of the surviving or the last surviving
depositor, the amount payable in the account of such deceased depositor shall be
315
paid to the legal representatives of such sole depositor or of the surviving or the last
surviving depositor, as the case may be. "Legal representatives" shall include either
the executor or the administrator who has obtained Probate or Letters of
Administration from a Competent Court in India or the holder of a grant of Succession
certificate or of any other proper grant of legal representation to the estate of such
deceased depositor from a Competent Court in India. The Bank reserves the right to
pay at its discretion the balance due in the account of such deceased account holder
to his/her heirs on a proper indemnity with or without sureties. The guidelines issued
for Deceased Policy to be followed.

6. Account of Minors:
(a) A Savings Bank account of a minor may be opened to be operated upon
by the natural guardian of the minor or by the guardian appointed by the Court.
(b) A Savings Bank Account may also be opened in
(i) The single name of a minor aged 10 years or more to be operated
upon by the minor.
(ii) The joint names of two minor who have completed the age of 10
years to be operated upon by them jointly.
(iii) The joint names of two or more minors to be operated upon by a
person who is the natural guardian of both or all the minors.
7. How to open Savings Bank Account:
Application to open a Savings Bank Account should be made on the Bank's prescribed
forms duly completed with his name, address and occupation. Each applicant will be
required to sign a declaration to the effect that he has read and accepted the Savings
Bank Rules. The KYC documents to be obtained for opening of any deposit account
as specified in Chapter 2.
8. Tierisation in Savings Account:
The Savings Accopunt products have been revamped and rationalized to suit the
needs of the market. The tierised savings account is based on relationship based
pricing model, wherein, customer is encouraged to avail maximum benefits in the form
of discounts and waiver on service charges, if the depositors are willing to maintain
requisite Average Quaterly Balance (AQB).

In order to have clear identification based on AQB, following tierised categories have
been enabled in the system (Finacle) for which system will calculate the AQB based
on the average balance maintained by the Savings account holder except staff and
institutional accounts.
Table 2
Sr. Name of Tier Minimum Range of AQB
No Qualifying AQB
1 Normal / Regular Below Rs 10,000/- Below Rs.10,000/-
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2 Classic Rs 10,000/- Rs.10,000/- & above but less than Rs.1.00 lakh
3 Gold Rs 1 Lakh Rs.1.00 lakh & above but less than Rs.5.00 lakh
4 Diamond Rs. 5 Lakh Rs.5.00 lakh & above but less than Rs.10.00 lakh
5 Platinum Rs 10 Lakh Rs.10.00 lakh & above

Please refer to the branch circular issued from time to time for details and latest
updations regarding the Savings Deposit Schemes.
9. Illiterate Depositors:
Any depositor unable to write must attend in person and (in the presence of an
approved witness who knows the depositor and is known to the Bank) affix his thumb
impression to the application and other forms and have it attested by the signature of
the approved witness. An illiterate depositor may lodge in person a passport size
recent photograph with the Bank subject to provision of rules regarding withdrawals.
10. Minimum Balances:
Minimum balance charges are levied for the non-maintenace of the stipulated balance
in the account. Presently there is no stipulation for maintaining Daily Minimum Balance
for all Non-BSBD Savings Bank Accounts. The criteria for recovering penal charges
are based on stipulated Average Quarterly Balance (AQB). Therefore, customer
enjoys freedom of utilizing his full amount on any particular day without any penal
charges on account of minimum balance. The charges will be guided by the service
charges circular issued by HO from time to time.

11. Maximum Balance:

There is no limit to the maximum balance in accounts. Interest will be allowed on the
balance in accounts.

12. Interest:

(a) Interest will be allowed at the rate prescribed by the Bank from time to time. The
present rate of interest allowed on Savings Bank Account can be ascertained at the
Bank. The Bank reserves the right to vary the rate of interest from time to time and to
increase or decrease the rate of interest payable.

(b) Interest on Savings Bank is calculated on the daily product (w.e.f. 1st April
2010).Saving interest will be credited quarterly in the months of May, August,
November and February, respectively and/or at the time of closing account.
12. Collection of Cheques, Warrants, etc.:
Cheques, Dividend Warrants, Interest Warrants, etc., in favor of a third party will not
be accepted for credit of a Savings Bank Account.
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13. Pass Book:

(a) A pass book will be supplied to the depositor indicating the account number
and the name of the depositor. Deposits in Savings Bank Account may be
accepted without production of the pass book if the number and name of the
account are clearly written on the paying-in-slip. No money can ordinarily be
withdrawn by withdrawal forms from an account without production of the pass
book.

(b) The pass book of the account should be updated from time to timethrough
branch/kiosk etc, particularly in the case of accounts operated upon by cheques.
Depositors should carefully examine their pass book before leaving the Bank
and ascertain that entries are correct. They should also be careful to keep their
pass books in their own possession. The Bank will not be responsible for any
loss caused to the depositor, if an unauthorized person obtains possession of
the pass book.

(c) The Bank will not be responsible or accountable for any sum claimed to
have been deposited which is updated in the pass book.

(d) Entries will be made by the Bank in the pass book in respect of amounts of
cheques, etc., deposited in the account.. Such amounts are, however, not
available for withdrawal until the cheques, etc., are realized.

14. Loss of Pass Book:

(a) No charge will be made for the pass book supplied in the first instance to
the depositor at the time of opening the account or any pass book issued to
him in continuation of the original pass book.If a pass book be spoiled,
mutilated or lost, the Bank may issue a duplicate pass book on payment of
a service charge by debit to his operative account as stipulated by Bank
from time to time. The charge may be waived at the discretion of the Bank
in cases where it is proved to the Bank's satisfaction that the depositor had
no control over the circumstances leading to the Pass Book being spoiled,
mutilated or lost.

(b) Loss of the Pass Book should be reported to the bank immediately. The
depositor/s will be required to sign a suitable letter of indemnity for issue of
a duplicate pass book where the pass book has been reported to be lost.
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 (c) If a statement of past entries is required, the Bank will make an appropriate
charge for labor involved in preparing it as per the extant guidelines of the
bank

(d) Facility of issuance of Duplicate Pass Books is to be extended to Saving

Bank accounts with cheque book facility only and not to be made applicable
to accounts operated by withdrawal slips.

15. Withdrawals:

(a) A customer is allowed to withdraw money from his account using various
forms of withdrawal like withdrawal slip, cheques, ATM/debit cards etc.

(b) A depositor cannot withdraw by withdrawal slip a sum smaller than Rs. 1/-
or any sum which is not a multiple of Re.1/- unless it be to close the account.

(c) When a depositor wishes to withdraw from his account by withdrawal slip
he must present his pass book personally or by duly authorized agent at the
Bank with an order for withdrawal on the form prescribed by the bank for the
purpose, signed by himself and showing the amount which he wishes to
withdraw. In the case of joint account the withdrawal forms should be signed in
accordance with the instructions given at the time of opening of the account.

(d) If the depositor is unable to write he must attend personally and affix his
thumb impression to the order, to be attested by the signature of the approved
witness who knows the depositor and is known to the Bank. If a photograph is
lodged with the Bank by an illiterate depositor, he need not have his thumb
impression attested every time he withdraws money. It will suffice if he affixes
his thumb impression in the presence of an official of the Bank..

(e) (i) Withdrawals may be made by cheques where allowed by the Bank. The
Bank reserves the right to refuse payment of a cheque drawn for amount smaller
than Rs. 5/-.

(ii) Cheques must be drawn on the printed forms provided by the Bank, the Bank
reserves the right to refuse payment of cheques drawn otherwise.

(f) Cheque Books as per scheme feature will be issued to the account of an
individual. Cheque Books will be issued only to good depositors who maintain
a minimum balance of Rs. 500 and Rs.1, 000 for account in rural/semi-urban
and urban/metro branches respectively. The Bank reserves the right to withdraw
319
the cheque book facility if a minimum balance of Rs. 500/-or Rs. 1,000 is not
maintained or for any other reason whatsoever, either with or without prior
intimation.

(g) Applications for cheque book can be made either digitally through
mobile/internet banking platforms or physically by the depositor in writing on
the Bank's cheque book requisition form at the branch. It is particularly important
that the printed requisition form inserted in the cheque book must be used when
a new cheque book is required. The requisition form should be signed in
accordance with the mode of operation of the account as specified at the time
of opening the Account.

(h) Accounts in which cheque books are issued will be drawn upon only by
means of cheques. However, withdrawals may be allowed by means of
withdrawal forms in accounts in which the cheque book facility is withdrawn or
at the discretion of the Bank.

(i) The attention of the depositor is particularly drawn to the notice on the front
cover of the cheque book, regarding the drawing of cheques and the safe
custody of cheque books.

(j) Cheques/withdrawal forms must not be postdated.

(k) Cheques/withdrawal forms must be drawn in such a way as to prevent

unauthorized alteration or additions after issue.

(l) No changes/alterations can be carried out on the cheques (other than for
date validation purposes if required).

(m) The amount of the cheque/withdrawal form must be stated in words and
figures. Writing should be clear and distinct.

(n) The Bank will be entitled to refuse payment of a cheque/withdrawal form

on which the signature(s) does not exactly correspond with that on record at the
Bank.

(o) It is desirable that in the case of a Savings Bank Account standing in the
names of two or more persons, the full title of the account should appear on the
top of the cheque drawn on the account. A rubber stamp may be used for this
purpose; such stamp (or writing) of the full title of the account would be in
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 addition to the usual signature or signatures.

(p)Cheques/withdrawal forms should not be issued before the necessary funds

have been credited to the relative account and are actually available for
withdrawal. If cheques/withdrawal forms are presented when there are
insufficient funds to meet them, payment will be refused and the
cheques/withdrawal forms returned as Savings Bank Account should not be
overdrawn. Disregard of this rule will entail summary closing of the account.

(q) The account number must be written on all cheques/withdrawal forms at

the place provided for the purpose. Should any cheque/ withdrawal forms be
drawn without the account number being mentioned thereon the Bank shall be
entitled to refuse payment of the cheque/withdrawal form.
(r) The bank will register instructions from the drawer of a
cheque/withdrawal form to stop payment of it, but cannot undertake any
responsibility in case such instructions are over looked for any reason or cause
whatsoever and howsoever arising.
A. Cash Payments in Branches
 (a) Any customer can withdraw money from his/ her account number either
through a withdrawal slip or a cheque. Branches should ensure below points
are adhered before making payments against withdrawals slips.
 Payment against withdrawal slip is allowed for account without cheque book
facility.
 Withdrawal slip when presented for payment by customer must accompany the
relative saving bank pass book.
 Third party cash withdrawals in Saving Bank accounts are not allowed by
withdrawals slip, even if they are accompanied by passbooks.
 Payments against withdrawal slips in accounts without cheque books are not
allowed at non-home branches even if the customer himself presents the
passbook and the withdrawals slip for payment
B. Withdrawal from Accounts of illiterate / Visually Impaired / Minor / Senior
Citizen/Sick/ Incapacitated customer Following guideline to be strictly adhere by
branches while making payment against withdrawal slip in the account of illiterate
/ Visually Impaired / Minor / Senior Citizen/ Sick/ Incapacitated customer.
Illiterate
The account holder should affix his thumb impression or mark in the presence of the
cancelling / authorized officer who should verify the identity of the person from the
photograph affixed to the passbook and / or display in CBS System prior to passing
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the withdrawal form for payment.
Visually Impaired
The visual impaired person should personally present himself/herself before the branch
official who will facilitate filling up the withdrawal slips.
Minor
The natural guardian or by the guardian appointed by the court can withdraw money
against withdrawal form. However, if a withdrawal form signed by natural guardian /
guardian appointed by court is presented for payment after the date on which the minor
has become major, the erstwhile minor must be contacted and his instructions sought.
If he cannot be contacted, the withdrawal form should be returned with the answer "Mr.
/Miss (the erstwhile minor name) has since attained majority.
Senior Citizen/ Sick / Incapacitated customer
 Branches are likely to come across some very old (senior citizen), sick and
incapacitated customers having pension or regular singly operated accounts.
The Bank- situation may arise sometime when account holder may not be able
to operate his account himself/herself for being unable to sign cheque or
withdrawal slip due to certain physical incapability. To overcome such situations
and help the distressed customer, the following guidelines should be uniformly
adhered to by Branches:
The cases of sick/old/incapacitated account holders fall into following categories.
-An account holder is too ill to sign a cheque/withdrawal slip and cannot be physically
present in the Branch to withdraw money from his bank account but can put his/her
thumb impression on the cheque/withdrawal form and
-An account holder who is not only unable to be physically present in the Branch but is
also not even able to put his/her thumb impression on the cheque/withdrawal form due
to certain physical defect/incapacity and operate a joint account, he/she should be
convinced to give Power of Attorney/Mandate for operating the account. The Power of
Attorney or Mandate should be carefully examined and noted in relevant branch
records.
 With a view to enabling the old/sick/incapacitated customers as described
above to operate their single accounts, the following procedure should be
followed
-Where thumb or toe impression of the old/sick/incapacitated account holder is
obtained, it should be identified by two independent witnesses known to the
branch, one of whom should be a responsible bank official.
-Where the customer cannot even put his/her thumb impression and also would
322
 not be able to be physically present in the Branch, a mark can be obtained on
the cheque/withdrawal form which should be identified by two independent
witnesses, one of whom should be a responsible bank official. This mark can be
placed by the person in any manner. It could be the toe impression as suggested
above, the point to be noted is that there should be physical contact between
the person's limb and the document i.e. cheque or withdrawal form.
-The customer should also be asked to indicate as to who would withdraw the
amount from the branch on the basis of cheque/withdrawal form as obtained
above and that person should be identified by two independent witnesses. The
person who would be actually drawing the money from the Branch should be
asked to furnish his/her identity by way of KYC documents and signature to the
Branch.
 The facility should be rendered in deserving cases, so as to provide relief to the
old / sick / incapacitated persons who are unable to withdraw cash over the
counter.
 The above points are illustrative and not exhaustive; the official allowing such
operations should fully satisfy himself about circumstances of each case and
identity of the person collecting cash on behalf of the old/sick/incapacitated
person should be established beyond doubts.

C. Transfer of Funds from one account to another Saving bank:

Withdrawal form / slip should NOT be accepted for inter-account transfer of funds
(i.e. transfer of funds from one saving bank account to another). However, for such
transfer of funds, Branches should follow below guidelines:-
• Branches may allow for transfer of funds from one account to another with the
written authority of the account holder(s) from whose account funds are being
transferred. Such authority letter should be signed in the same manner as the
cheques on the account are signed.
• The signature(s) on the letter of authority should be verified by the cancelling
officer before effecting transfer of funds.
• Such transfer of funds should be effected only by passing separate vouchers on
the basis of an authority letter signed by the account holder.
• Branches should ensure that letter of authority has pasted to the relevant debit
voucher in such a way that the signature(s) thereon and the amount mentioned
therein are not obliterated.
• The transfer of funds on the basis of phone call or e-mail should not be solicited
from the account holders. These being the most fraud prone area, where chances
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 of entering into dispute /litigation are more. Branches have to execute controls and
tactfully handle such request from customers.
Note: This rule would apply in case of accounts of staff members also.

16. Transfer to Other Deposit Account:

The Bank would accept instructions from depositor to transfer amounts from their
Savings Bank Account to other types of deposit account such as Short Deposits, Fixed
Deposits, Monthly Income Certificates, Recurring Deposits, Double Benefit Deposits,
etc. Such instructions should normally be accompanied by cheques/withdrawal forms
drawn on the depositor's account together with completed opening forms/cards in
respect of the deposit accounts proposed to be opened. Transfer to such deposit
accounts would be subjected to minimum amounts prescribed and Bank's rules
relating to such accounts prevailing from time to time.
17. Nature of Savings Bank Account:

Saving Bank Accounts are not intended to take the place of Current Accounts. Savings
Bank Accounts must not be overdrawn.

18. Business Hours:

The Savings Bank will be open for transaction of business during the normal hours
the Bank is open for business.

19. Change of Address:

Change of address should be immediately intimated to the Bank in writing by the

customer along with the relevant OVDs/documents. The evidence submitted by the
customer to the bank should be verified with original and relevant changes are to be
made in the system.

20. Nomination Facility:

Nomination Facility is available to new as well as existing SB Accounts. A nomination

form duly filled up and signed by all account holder/s is required to be submitted to the
Bank for the purpose. The account holder/s can make, cancel and vary the nomination
at any time during currency of the account by submitting the prescribed form for the
purpose duly signed. The nomination can be made in favour of only one individual.
The name of the nominee can be indicated in the Saving Bank Pass Book if so
324
desired by the account holder/s, in writing.

21. Closing of Accounts:

(a) if a depositor closes the account within 12 months of opening it, a small
charge will generally be made as per extant guidelines issued from time
to time

(b) The Bank reserves the right to close any account without previous
intimation if in the Bank's opinion it is not operated upon satisfactorily or for
any other reason whatsoever.

22. Deletion, Addition and alteration to rules:

(a)The Bank reserves to itself the right to delete, add to or alter these rules at any time
without giving a separate notice to every account-holder. An announcement of any
change in the rules put up on the Bank's Notice Board, Bank’s Website, or published
in the press shall be deemed to be sufficient notice to all account-holders.

(b) These rules as amended from time to time as aforesaid shall constitute a contract
between the account holder and the Bank and will be binding on the account holder,
his heirs, executors, administrators or other legal representatives and on the Bank.

23. Service Charges on Savings Bank Accounts

Service charges on savings bank account should be levied as per instructions given
by Head Office from time to time.

24. Inoperative Accounts – Criteria for classification:

A savings as well as current account should be treated as inoperative if there are no
transactions in the account for a period over one year & Dormant if there are no
transaction in the account for a period over one year from the date of account classified
as inoperative. Both the types of transactions debit as well as credit transactions
induced at the instance of customers as well as third party will be considered. RBI has
clarified that interest on term deposits credited to the account of the customer should
be treated as customer induced transaction since it is according to the mandate of the
customer. In such cases, the account should be treated as an operative account as
long as the interest on term deposit account is credited to the Savings Bank account.
RBI has also clarified that the instances where the customer has given a mandate
for crediting dividend on shares to bank accounts and the same should be treated as
a customer induced transaction. The Savings Bank account can be treated as
inoperative account only after two years from the date of the last credit entry of interest
325
on term deposit.

25. Dormant Accounts

25. The Reserve Bank of India requires banks to submit information every year in
respect of accounts which have been dormant for 10 years and more. Include the
para pertaining to Depositor Education Awareness Fund. To facilitate this being
done, Branches should deal with dormant savings bank accounts as given below:
26. Operationalizing the Dormant / Inoperative accounts

i) Branches should identify all the inoperative accounts, not operated for more than
two years, and with a balance of Rs 1000/- to be classified as inoperative account
through system every half year. Branches should approach the customers and
inform them in writing (A suitable system generated communication will be sent to
such customers ) exhorting them to (a) activate their accounts or (b) they may be
asked to provide details of their existing Bank account details, if they are shifted to
new area so as to transfer the amount lying in the account.
ii) Branches are required to make an annual review to identify inoperative
accounts and send communication to the customer stating that the account will slip
into the inoperative/dormant category within 3 months. In all such cases, where
the accounts continue to be inoperative even after sending a written reminder, the
customers will be contacted over phone or in person for getting the accounts
activated and a record thereof shall be maintained at the branch. In cases where
the letters sent by the Bank are returned undelivered, the branch should make
efforts to contact the customer immediately thereafter by approaching the
introducer or the neighbors at the last recorded address and gather information
about the accountholder’s present whereabouts.

iii) In all other cases, i.e. accounts with balances of less than Rs 1,000/- , system
generated reminders will be sent after one year from the date of last customer
induced operation in the account and necessary follow up through phone calls/
personal visits to the address given at the time of account opening/ last recorded
address for getting the account activated. If necessary help of the introducer
/customer’s neighbors be sought to contact / locating the customer for the above
purpose. In case of deceased customer the details of legal heirs are to be obtained.

27. Steps to be taken when requests for activation are received

When a request for activation of a dormant account is received, approval for activation
should be accorded by a designated officer at the branch. She/he will verify and satisfy
326
her/ himself that the account was opened in a KYC compliant manner and the reasons
adduced by the account holder for not operating the account are genuine. Fresh set
of KYC documents in respect of residence proof shall be obtained and the same
should be confirmed by sending letter to the above address given by the customer.
Further it should be seen that the amount of deposits being made is commensurate
with the occupation level of the customer, as declared in the account opening form
and the transaction should be closely watched.

(a) Dormant Accounts Not Earning Half-Yearly Interest

28.1. Savings Bank Accounts having such balances which do not earn half-yearly
interest should be treated as dormant accounts provided they are not operated upon
by the account holders for a continuous period of one year. Such accounts (except
Staff Accounts) should be transferred to the Register of Dormant Savings Bank
Accounts with full particulars in the month of July every year. Now, System take care
of the marking of Dormant Accounts.

28.2. Before actual transfer of accounts is effected, ACXFRSOL is the menu through
which we can transfer saving account to other branch by maintain same account
number. But the account receiving Branch should obtain KYC document for their
record.
(b) Dormant Accounts Earning Half-Yearly Interest

Apart from the dormant accounts with very small balances which do not carry any
interest, there may be certain accounts, although dormant for 10 years, may have
balances sufficient enough to earn half-yearly interest. Now system takes care of
conversion of normal account to dormant account.
28. Operations on a Dormant Account
28.1. Sometimes an account holder whose account has been transferred to the
Register or to the Savings Bank Dormant Accounts Ledger may issue a cheque or a
withdrawal form. In such a case, special care has to be exercised to identify the
customer and after the Branch Manager is satisfied he should ask the account holder
whether it is his intention to continue operating the account or whether he desires to
close it.

28.2. If the account holder intends to close the account, he should be asked to withdraw
entire balance of his account and his cheque or withdrawal form should be paid to the
debit of the consolidated "Savings Bank Dormant Accounts" or to respective individual
account if it is an interest earning account, as the case may be. Before paying out the
327
balance, all the usual formalities should be followed and unused cheque forms, if any,
should be recovered from the account holder.

28.3. All withdrawals from Dormant Accounts should be permitted only under the
signature of two authorized officials, one of whom must be the Manager (Dy.
Manager/Dy. chief Manager in case of large branches).
29. Transfer of Dormant Accounts to "Operative" Savings Bank Ledgers

. When an account holder operates on his account which has been dormant, the
procedure is:

29.1. Large number of deposits made by account holders who have not made any
nomination are presently being held by branches as dormant Savings Bank Accounts.
Branches should follow up with such account holders by sending advices (as is being
done in the case of Current Account holders) to the customers at their addresses on
record. If such letters are returned undelivered, the Branch should take immediate
steps to find out to the best extent possible, the whereabouts of the customers or their
legal heirs, in case they are deceased. Such follow up would be of timely assistance to
the legal heirs and would also reduce the quantum of unclaimed deposits with the
Branch.

30. Segregation and Storage of Specimen Signature Cards of Dormant

Accounts
30.1. As soon as the eligible dormant savings bank accounts have been transferred
to the Register of Dormant Savings Bank Accounts, the relative specimen signature
cards should be removed from the specimen signature card cabinets. They should be
arranged in serial order according to the account number and made into bundles of
100 cards. HARD COPY OF THE DORMANT ACCOUNT HAS TO BE MAINTAINED
PROPERLY.

30.2. When there are occasions to transfer any dormant account to the operative
ledger, the relative specimen signature card should be removed from the bundle of
cards stored in the safe and replaced in the specimen signature card cabinet at the
appropriate pocket.
31. Temporary Overdraft Payment of Cheque in Excess of Balance/Easy
Overdraft:
Temporary overdraft/easy overdraft must not be allowed in a savings bank account
except in the cases mentioned in paragraph no. 31.1 below.
31.1 In a savings bank account-Salary and pension accounts where regular remittance
328
is received periodically, say monthly salary etc., if a crossed cheque drawn by the
account holder against the expected monthly remittance is presented for payment
before the actual remittance is received, the cheque may be paid even though the
balance in the account is not sufficient to meet the cheque. This facility is available
subject to the features of the account scheme as menstioned in the branch circular
issued and revised by the HO from time to time.

31.2 Before deciding to pay such a cheque, the Manager should personally examine
the circumstances for the delay in receipt of the usual remittance and take into account
the standing of the account holder, amount of the cheque, shortfall in the account, etc.
(Usually such cheques would be for payment of insurance premium, school fees,
telephone/electricity bills etc.)

31.3 The shortfall in the savings bank account should be shown in the savings bank
account itself in other words, when a crossed cheque is presented for payment before
the actual monthly remittance is received, temporary overdraft/easy overdraft should
be granted in the savings bank account. It should, however, be noted that, except in
the aforesaid case, under no circumstances can a temporary overdraft/easy overdraft
be granted in a savings bank account.

31.4 Payment of the crossed cheque creating an overdraft in a savings bank account
must be authorised by the delegated authority on the cheque in token of his approval.
Payment of such a cheque should be entered in the Register of Temporary Overdrafts
(Form CD 28) and the entry should be initialed by the Manager. The last two pages of
the Register of Temporary Overdrafts which is used for grant of temporary overdrafts
in Current Accounts may be reserved for recording temporary overdrafts/easy
overdrafts in savings bank accounts. The date when a temporarily overdrawn account
is put in order should be recorded in the register of Temporary Overdrafts under the
appropriate column and initialed by the Manager/ Deputy Manager.

31.5 Temporary overdrafts/easy overdraft so created in a savings bank account

should be immediately reported to the higher Controlling Authority if they are not
repaid within a week. As in the case of current accounts, temporary overdrafts/easy
overdrafts granted in savings bank accounts should also be reported to the Controlling
Authorities as per the procedure laid down in respect of such reporting. The
instructions regarding reporting of temporary overdrafts in current accounts shall be
applicable to temporary overdrafts/easy overdrafts granted in savings bank accounts

31.6 The facility of permitting a savings bank account to be temporarily overdrawn

should be on very restrictive and selective basis i.e. on occasions as stated in
paragraph 23.3 above and such occasions to grant temporary Overdrafts/easy
329
overdraft should be few and far between in any account

31.7 When the account is allowed to be so overdrawn temporarily, Branches should

send to the account holder an advice requesting him to put the account in order
immediately (Form CD 57), this should be followed up to ensure that the debit balance
in the account is wiped out within a week / 10 days.

31.8 The rate of interest to be charged on overdrafts allowed should be the maximum
lending rate prevailing at any point of time.

31.9 The debit balances of accounts so temporarily overdrawn should be jotted daily
in the Daily Extract of Overdraft Balances.

31.10 The facility of such temporary overdrafts/esy overdraft should be extended only
on individual accounts excluding minor's account, non-resident account etc.
32. Other Instructions

32.1. Instructions given in Chapter 2 on Deposits-General and Current/Savings Bank

Accounts- General also apply to Savings Bank Accounts.

32.2. Services such as safe custody, purchase and sale of shares, remittances, etc.,
may be made available to savings bank account holders where such accounts are
fully kyc complied.
33. Special Savings Bank Deposit

33.1 BOI SAVINGS PLUS SCHEME

This is a combination of Short Deposit Scheme and our Savings Bank

Scheme with very attractive features.

Technical Support:-

1. The scheme is made available at all branches. The system takes care of the entire
operations of the new GL A/c (BOI Saving Plus) including the complex calculations,
sweep outs/ins, interest calculations, applications and provisions etc. The system will
assist the customer to view the latest position of accounts including Savings Bank
position, Pseudo balance which shows total funds at the disposal of the customer.

Accountings:-

2. TheTerm deposit portion appears under Term Deposit head in GLB and the linked
Savings Bank portion will continue to remain in GL Head Savings Bank. A separate
P/L head styled “Interest on BOI Saving Plus” is opened to route interest amounts
credited in the BOI Saving Plus accounts. The quarterly provision procedure is same
330
as the one followed in DBD accounts which is taken care by system.

Eligible accounts:-

Under the scheme, Saving Banks accounts are subject to the Minimum balance in SB
portion is Rs.1,00,000/- and minimum balance in Term Deposit Portion is Rs.25,000/-.
Non-maintenance of requisite balance shall attract penal charges as applicable from
time to time.

Basic feature of the scheme:-

Subject to the minimum balance stipulated in the S/B account as stated above,
balances above Rs.100000/- in the S/B accounts of customer who have opted for the
scheme would be transferred to SDR or DBD portion Rs. 25000 for tenure as opted
by the customers between 15 days and to 364 days (In the SDR portion, money can
be invested for any period from 15 days to 179 days, as per the customer’s choice.
In the DBD portion, money can be invested from 6 months upto 364 days, as per
customer’s choice). Such transfers from the Saving Bank accounts are termed
"sweep outs". Branches have to ensure that while opening a new Savings Plus
Account, the account should have Minimum Rs. 125000/- balance in the
Savings Account.

The sweep out will happen on daily basis. Any amount in excess of Rs 100000/- in
Savings bank account will be automatically transferred to Term Deposit Account in
multiples of Rs. 25000/- on daily basis. Service charges will continue.

The BOI Saving Plus account is nothing but a structured short deposit account
maintained parallel in the computer system with linkage to the savings bank account
of the concerned customer. Principal would be auto renewed, and interest would be
credited to SB A/c on maturity. The interest money can be swept back into SDR / DBD
as per customer’s choice once again for a period of his / her choice. TDS norms would
apply as per extant rules. Sweep-ins would take place on LIFO basis. In case the
customer wishes to renew for a shorter or longer period he should communicate in
good time to the branch concerned.

The Swept out money can be invested in SDR, for a period from 15 days to 179 days
& In DBD for a period of 6 months to 364 days

To meet the urgent funds requirement of BOI Saving Plus customers, funds would
be transferred from the BOI Saving Plus account to their respective savings bank
account (sweep ins) to meet cheques in clearing or at the specific request of the
customer subject to the availability of the funds in BOI Savings Plus accounts.

Such transfers would again be in multiples of Rs. 1,000 on daily basis and would
not be subject to any premature Penalty-. The system would take care to break
the deposits which is of recent origin to give maximum benefit to the customers
(i.e. it would break deposits using LIFO Method - last in first out).

331
The transfer in Rate of Interest:-

On BOI Savings Plus account the rate of interest shall be the rates applicable for
the tenure of deposit decided by the customers. As usual Savings Bank portion
would continue to earn interest as per the Bank directives. Interest on BOI
Saving Plus would be calculated on quarterly compounding basis.

Lien on BOI Saving Plus Accounts:-

The customer may not assign, transfer, charge, pledge or otherwise encumber
any BOI Savings Plus Deposit except in favor of the bank, as security for any
obligation of the customer to the Bank.

Operational guidelines for branches:-

The system takes care of various complicated calculations involved in the

scheme. The following may additionally be noted:-

All the sweep out / sweep in would be carried out at the "end of day operations" (EOD)

All the automatic renewals of BOI Saving Plus deposits would also be carried out
at the "end of day operations".

The system will always display the total funds at the disposal of a customer (i.e.
free funds in S/B and the balance of BOI Saving Plus account - Principal
amounts only). This would be termed as "pseudo balance".

The exceptional reports in S/B Accounts having linkage with BOI Saving Plus
would be generated after considering the "pseudo balance".

There is no change in respect of mode of calculation of interest in Savings Bank

and interest calculation / application / provisioning in respect of SDRs as
applicable to BOI Savings Plus account.

The TDS norms would equally apply to accounts and would be handled in the
usual manner. The receipts in BOI Savings Plus account (in electronic form)
would be serially numbered and all the details of BOI Savings plus scheme could
be viewed at any point of time.

33.2 Super Savings Plus Deposits

The features of the Super Savings Plus are as given below: -

Super Savings Plus Deposit
Initial Deposit Rs.20 lakh
Quarterly Average Balance (QAB) Rs.5 lakh
Sweep in Daily
Sweep out Every 15 days
Multiple amount Rs.15 lakh

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 Period of deposit Less than 6 months

Rate of interest Card rates as applicable to deposits of Rs.15 lakh and

above

Charges for non-maintenance of Quarterly Average Rs.1,000/- per quarter to be levied.

Balance (QAB)

Except for initial deposits, multiple amounts for Sweep in & Sweep out, rate of
interest, Quarterly Average balance (QAB) and charges for not maintaining
Quarterly Average Balance (QAB), all other product features including terms and
conditions will be the same as applicable to the Savings Bank Plus.

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 Appendix I
Draft of Letter of Undertaking for Issue of Duplicate Savings Bank
Pass Book

Date:

Bank of India
_______________Branch

Dear Sirs,

Re.: My/Our Savings Bank A/C.

No. _____________________
Re.: Loss of Pass Book
Re.: Issue of Duplicate Pass Book

I/we have to inform you that I/we have lost the pass book of
my/our above Savings Bank Account No…………………..

2. Inspite of my/our best efforts I/we have not been able to trace it. It appears to
have now been irretrievably lost.

3. As it may be difficult for me/us to operate the account without a pass book I/we
request you to issue me/us a duplicate pass book. You have agreed to do so on the
faith and strength of my/our representation and on my/our giving an indemnity as
hereinafter appearing.

4. I/we confirm that the balance in the said account as on was Rs.and I/we agree
that the said balance will be the opening balance in the new pass book that may be
issued by you.

5. In consideration of your agreeing at my/our request to issue the duplicate pass

book, I/we so as to bind our/my respective heirs, executors/administrators estate and
effects hereby agree and undertake with you and your successors and assigns as
follows :-
(i) to indemnify you and keep you indemnified from and against all present and future
claims, demands, actions, proceedings, loss, damage, liability, costs, charges and
expenses whatsoever which may be made or commenced against you or be paid,
sustained, suffered or incurred by you whether now or at any time as a consequence
direct or indirect of your issuing me/us a duplicate pass book as aforesaid.
334
(ii) to pay and make good on demand the amount of any such loss, damage,
liability, costs (the legal costs being as between attorney/advo cate and client )
charges and expenses together with interest at 12% per annum from the date of
payment by you until reimbursement by me/us.

(iii) that I/we shall return to you the original pass book should it be found by me/us or
should it again come into my/our possession at any time hereafter.

Yours faithfully,

(NOT TO BE ATTESTED)

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 CHAPTER 5- CURRENT/SAVINGS BANK ACCOUNTS-
GENERAL

I. PAYMENT AND ENDORSEMENT OF CHEQUES

Payment of Cheques/Withdrawal Forms
1. Quick payment of cheques/withdrawal forms/slip reduces waiting time at counters,
leads to high level of customer satisfaction and has the effect of toning up of the image
of the Bank. It is, therefore, of paramount importance that Branches make payment of
cheques/withdrawal forms as quickly as possible-within five minutes. This helps us to
follow the Banking code and standard board of India (BCSBI) fair practices norms. The
newly introduced withdrawal form/slips are used only in saving bank withdrawals.

1.1 The payments through Aadhar Enabled Payment System (AEPS) through Hand Held
Device (HHD) over the counter in all Aadhar Enable account assist us in speedier
payments to the account holders.

2. Issue of Tokens (Currently not in use)

3. Scrutiny/Posting of Cheques by Counter Staff

3.1 When posting cheques/withdrawal forms in the account, counter staff should ensure
that:

(a) the cheque presented is from the cheque book/ cheque leaves issued to the
account holder and its payment is not stopped by the drawer, or while posting cheque
the counter staff should not override the flag prompted by the system.

(b) the cheque is not postdated or stale (normally Bank cheque is valid for payment for
three months, unless the validity is restricted by the drawer and suitably enfaced on the
instrument itself) and is not crossed (in case of cash payment). Any alteration on the face
of the cheque is not accepted even if counter signed by the drawer

(c) the signature (s) on cheque/withdrawal form is according to the instructions

regarding operations on the account e.g., A
̏ nyone to sign," ̏Jointly," etc,

(d) a cheque drawn payable to order is endorsed properly (counter staff should refer
irregular endorsements to the cancelling officers),
(e) Clear balance is available to post the cheque/withdrawal form and that the amounts
in words and figures tally. Ensure that uncleared effects are realized and the cheque/
withdrawal form will be fully covered by the clear balance in the account. Posting of
cheques in current accounts against uncleared effects should be done if there is a regular
sanction to pay against uncleared effects or the payment is approved by the authorized
cancelling officer; the cancelling officer may refer for payment of such cheques to the
Manager or the officer concerned of Current Accounts Department having authority in
this regard. (Also refer paragraphs 26 and 27).
336
(f) Restrictions
placed on the operations on an account under orders of Court/ Income
Tax Authorities etc., are fully adhered to.

3.2 After posting the cheque/withdrawal form counter staff should enter transaction
number and initial in the space provided there for on the cheque/withdrawal form.
Through menu SCWRPTA daily cash paid/received should be printed and hold on record
for further use.

3.3 Counter staff should enter all cheques which cause temporary overdraft in current
accounts in the Register of Temporary Overdrafts (Form CD 28) (Refer paragraph 6 of
the Chapter on Current Accounts).

3.4 The counter staff should follow the added security designs/features, color, micro
lettering patterns on the personalized cheque, CTS2010 (Cheque Truncation System
standards) to curb the scope of misuse or fraud.

3.5 The cashier /SWO –B making the payment through withdrawal slip/form/cheque
should invariably mark these instruments with the facsimile stamp of payment with proper
initials to give validity of the payment over the counter.

Passing Cheques/withdrawal Forms for Payment

4.1 Where an account is opened by deposit of cheques, drafts etc., (which might have
been stolen or spurious and might have been fraudulently obtained), Branches should be
on guard whenever there is immediate and large withdrawal there against. Heavy
withdrawals in newly opened accounts should be closely monitored. All payments in cash
for Rs. 5,000/- and above should be passed by the passing officer only after he scans
through the recent entries, especially the credit entries in the account and satisfies himself
about their genuineness. The counter staff should immediately bring this to the attention
of the cancelling officer who should put his initials against the debit entry in the account
for the cash withdrawal to signify that he has carried out the necessary verification of facts
and established the identity/bonafides of the account holder by contacting him or the
introducer and taking such other steps as may be necessary.

4.2 ‘Know Your Customer’ KYC principle is applicable to all new deposits and advance
accounts. Cash Deposits and Cash withdrawals for Rs.10 lakh and above should be
closely monitored and detailed record to be maintained. The Suspicious Transaction
Report (STR) should be submitted within 7 days of arriving at a conclusion that any
transaction is of suspicious nature. The records of (Cash Transaction Report/ Normal
Transaction Report) CTR/NTR/STR should be preserved in the branch and made
available as when demanded by the controlling authorities.

As per KYC principle issuance of Traveler’s Cheques, Demand Drafts, Mail Transfers and
Telegraphic Transfers for Rs.50,000 and above only by debit to customers’ accounts or
against cheques and not against cash and should also affix Permanent (Income Tax)
Account Number (PAN) on the applications.
337
4.3 Similarly, extreme caution should be exercised in cases where a nominal initial deposit
(say Rs. 100/200) is made in the account, the purpose of such initial deposit in a savings
bank account could be only to obtain a pass book from the Branch and attempt a
fraudulent withdrawal thereafter. The large value cash/transaction should be monitored;
the cash/transaction must relate with the activity of the account holder and hold economic
or lawful purpose.

Whenever an attempt is made at a cash withdrawal of substantial amount disproportionate

to earlier withdrawals leaving thereby only a small balance in the account, such
instruments i.e. the cheque or a withdrawal slip should be thoroughly scrutinized and
signature carefully verified and, if possible, the account holder be called at the Bank or
contacted by the concerned officer before passing the instrument for payment.

4.5 Cancelling officers must scrutinize all cheques/demand drafts/withdrawal forms of

cash payment and signatures on all letters of authority (instead of cheques) authorizing
payment under Ultra Violet Ray Lamp to detect fraudulent alterations not visible to the
naked eye. All cheques/demand drafts of Rs. 5,000/- and over presented
through ̏Clearing" and T
̏ ransfer" must similarly be examined before passing them for
payment. (As a matter of abundant precaution it is suggested that Clearing/Transfer
cheques for amounts even less than Rs. 5,000/- should be examined under Ultra Violet
Ray Lamp, whenever it is practicable). It would also be necessary to examine under the
Ultra Violet Ray Lamp, all drafts irrespective of the amount if they are to be paid in the
absence of drawing advice of the issuing Branch. (Also refer paragraph 16.)

4.6 The counter staff and cancelling official should refer the suspected cheque through
UV Ray Lamp machine. Such cheque examined and honored should be marked as
“Checked by UV Ray lamp” to up keep records.

Verification of signatures:
In comparing signatures by keeping them upside up, there is a natural tendency to read
the signature letter for letter, rather than compare it. In the process, vital differences in
slope, continuity, space, size, boldness or strokes are likely to be overlooked. Upside
down method of comparison will easily disclose major differences, if any. Since the
signatures cannot be read, the officer will always tend to compare its different
characteristics. Besides, similarities or disparities will be revealed if the signature on the
cheque is also compared with the specimen signature with the right side up, left side up,
i.e. from all possible angles.

Cancellation of Cash Payment Instruments

5. Cancelling officers should scrutinize cheques or any other instruments thoroughly and
verify signatures of accountholders with the relative specimen signature cards, if
necessary and cancel the signatures. In respect of accounts of illiterate depositors who
cannot sign and give thumb impression or those who can sign only in capital letters and/or
distinct/disjointed alphabets and where Branches are required to obtain photograph of the
account holder (refer Chapter 2 on Deposits General), for the purp of withdrawal such
account holders should personally come to the Bank and sign in the presence of the
cancelling officer who should verify the identity of the person from the photograph affixed
338
to the account opening Form/card or image of the account holder captured in the system
prior to passing the instrument for payment. Signature(s) of drawer(s) on cheques,
withdrawal forms and vouchers (or any other instruments) for cash payment of Rs. 500/-
and over should be cancelled (or passed for payment) under the full signature(s) and not
initials of the cancelling officer(s). Ordinarily, cheques etc., for cash payment of Rs. 10,000/
and above (or the applicable amount as authorized by the Zonal Manager) are required
to be cancelled (or passed for payment) under the full signatures of two cancelling officials
authorized in that behalf. The Zonal Manager may, however, in certain cases within his
authority in this regard, also authorize cancellation or passing for payment of cheques
etc., for amounts in excess of Rs. 10,000/- by an officer singly if warranted by
circumstances.

5.1 In the newly opened deposit accounts, for the first six months, cash withdrawals of
Rs. 25,000/-and above and clearing/transfer payment of Rs.50,000/- and above must be
counter-signed by another official (say Chief Manager/Dy. Chief Manager/Manager /Dy.
Manager as the case may be), other than the cancelling officials.

5.2 The cancelling officer should honor the cheque by adopting proper method of
cancellation. This process of cancellation begins with ticking date, followed by checking
the crossing or lines on left side upper part, the name of the payee, subsequently, check
the amount in words and in figure, and the signature appearing on the
cheque/withdrawal form tallying with our records. After ticking all these aspects,
proceed for cancellation, the BIXXXXX with number should be struck down by a small
tick and an initial. The Signature part of the drawer of the cheque should be properly
defaced i.e. by drawing a clear and unique un- mixed mark below the drawer’s signature
for easy identifications with red pen. At the back of the cheque or withdrawal from the
dual signature of the account holder or holder or representative with the given currency
details with cheque/withdrawal form to stop payment authorize/verify the financial
transaction to make it complete. (The details are enclosed in image 5.2.i)
This procedure will ensure following the provisions of the Negotiable Instrument Act and
correct flow of the payment in due course. These flows ensure the fully checked and
complete financial transaction status to any payment.
Cancellation powers to be exercised singly
6. The following powers for cancellation may be granted by the Zonal Managers to the
Officials at Branches on merits, as per Branch Managers' recommendations.
Cancellation means not only cancellation of cheques but also cancellation of signatures
on inward mail transfers (Credit Authorization Notes), Credit Notes, demand drafts, Pay
orders and term deposit receipts, etc.
Category of Staff Powers to be exercised singly
Cash Cheques upto Clearing Transfer
and including(Rs.) Cheques(Rs.)
I. Special Assistants 35,000/- 1,50,000/-

II. Officers
Promotee Officers/Direct recruit
(a) 50,000/- 50,000/-
officers(during probation)
339
 (b) Officers after confirmation 50,000/- 1,00,000/-

(c) Managers of One Officer Branches Full powers Full powers

The signing Powers of Special Assistant (AS per work class) and the officers revise from
time to time.
(i) The powers recommended are the maximum and the Zonal Managers have the
authority to fix lower limits whenever necessary, in respect of individual officials,

(ii) There will be an enabling provision for the Zonal Manager to permit higher powers or
full powers in this regard to an officer, provided the situation warrants such a sanction.
Such a sanction, in excess of the above indicated powers should be reported to Head
Office, Personnel Department.

(iii) Regarding second cancellation the following requirements are to be followed:-

(a) Where the first cancellation is a Special Assistant, the second cancellation
invariably should be done by an Officer.

(b) Where the first cancellation is by an Officer, the second cancellation will be done
by another Officer.
(iv) In finacle/system the Designation/work class is linked with the transaction limit and
transaction right for financial transactions. This matrix for transaction limit must be
followed strictly for Data Entry/Posting/Verification.
Officers passing payment of cheques should pass (cancel) the drawer's signature on
the instrument in such a manner that it is not obliterated /defaced. (If the drawer's
signature is obliterated /defaced, the police authorities do not pursue cases of frauds,
or we may loss our claims before the judicial authorities.)
Signing of Clearing and Transfer Vouchers

7.1 The limits for signing clearing and transfer vouchers are as below:

Signatory signing under

Section Section II(swo A/B/head

I(officers) cashier/Special Asst.

For amounts upto and inclusive of May be signed singly May be signed singly
Rs.50,000/-
May be signed singly May be signed singly except
Above Rs 15000/-and up to Rs 25000/- SWO A- Work class 110

May be signed singly except

Above Rs 25000/- and up to Rs May be signed singly SWO A- Work class 110 & SWO
50000/- B-Work class 130

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For amounts above Rs.50,000/- & upto May be signed singly Must be signed
Rs.1,00,000/- jointly
For amounts above Must be signed Must be signed
Rs.1,00,000/- jointly jointly

Note: Section I – comprises of all Officers & Section-II Special Assistant / Cashier-in-
Charge
i) Where first signatory is of Section II, the second signatory must be of Section I
ii) Where first signatory is of Section I, the second signatory must be of Section I except
in case of single officer branches.
iii) The above instructions are not applicable to P&L, Suspense Debits, Sundry Credits,
Sundry Deposits and Dormant Account Vouchers etc., which should be invariably
signed by two officials and one among these two officials must be a Branch Manager
or person holding the charge of the branch.

Scrutiny of Cheques by Officers:

8.1 Apart from the items scrutinized by the counter staff before posting the cheques in the
account, the cancelling officers should also examine in particular that (a)
cheques/withdrawal forms etc., are not stale or postdated., (b) cheques presented for
payment across the counter are not crossed, (c) the amounts in words and figures agree
and d) No alteration on the face of cheque

8.2 Ordinarily, ̏bearer'' cheques should present no difficulties since the Bank is
discharged, if payment of a bearer cheque is made to the bearer thereof. But bearer
cheques payable to Limited Companies, Government Departments etc., should not be
paid across the counter without enquiries as cheques favoring such payees are expected
to be collected through their bank accounts.

8.3 Care should be exercised in cancelling cheques drawn to order of the payee. Section
85 (1) of the Negotiable Instruments Act states, "Where a cheque payable to order
purports to be endorsed by or on behalf of the payee, the drawee is discharged by
payment in due course." ̏Payment in due course'' is defined as ̏payment in accordance
with the apparent tenor of the instrument in good faith and without negligence to any
person in possession thereof under circumstances which do not afford a reasonable
ground for believing that he is not entitled to receive payment of the amount therein
mentioned" (Section 10 of Negotiable Instruments Act). In order that the Bank is
discharged by payment, "order" cheques must be properly endorsed and the payment
should be made without negligence, under circumstances which do not afford a
reasonable ground for believing that the person is not entitled to receive payment of the
cheque. (Refer paragraphs 17 to 24 for details on Endorsement).

8.4 It is, therefore, a good practice to make enquiries to establish the identity of the person
who has presented an ̏order" cheque to satisfy that he is the person who is entitled to
receive the payment. Invariably anywhere sol transactions i.e. payment by branch other
than parent branch needs correct identification and inquiries to make payment complete.
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8.5 Sometimes a cheque is drawn payable to ‘’A only" without the addition of words "or
order". The use of words "pay to `A' only" on cheques would restrict the negotiability and
transferability and the collecting banker would not get adequate protection under the
Negotiable Instruments Act, 1881. Branches should discourage the drawing of a cheque
as “Pay to `A' only".

8.6 Cheques written in two different languages, e.g. the amount in figures in Gujarati and
the rest, including the amount in words in say Hindi, if presented for payment, should not
be returned if the order of the drawer is clear, without any mistake, understandable and
the cheques are otherwise in order. Also cheques drawn as per `Saka' Era should also
be paid if otherwise in order. We should ascertain the Saka calendar date correspond to
the Gregorian calendar date in order to avoid payment of stale cheque.

8.7 In general, if cancellation of cheques is done intelligently keeping in mind the special
features of an account as to operations, amounts drawn, new security features, design
and color pattern of cheque, etc., possible fraud may be detected in good time.

Scrutiny by Cashiers before Payment

9. When the cashiers receive cheques and vouchers for payment, they should verify that
all such payments are duly entered / posted / verified (as per the work class/designation
provided in the transaction limit matrix referred in para 6 (iv) cancelled by the authorized
cancelling officer(s).

Paying cashiers and their assistants should ask the presenter of the
token/cheque/withdrawal form to state the amount to be received by him. (This ensures
that payment is not made to the wrong person or of the wrong amount). It is the duty of
the paying cashier to see that his assistants strictly follow this rule. (Also refer Chapter
on Cash and Clearing).

10. Payment Scroll Book –this is dispensed with due to direct entry of the
cheque/withdrawal form in the finacle/system.

11. Signing of Vouchers and Authentication of Transfer Cheques

11. All credit and debit vouchers for Rs. 5,000/- and over should be signed in full by
the official concerned. The ̏Account Payee" stamp on transfer cheques received
internally over the counter for Rs. 5,000/- and over should be authenticated by the full
signature of an official of Cash Department (and not merely by his initials). (Where only
a clerk-cashier with authority to sign is in charge of the cash Department, his
authentication would suffice). Also refer to paragraph 7.1.

12. Letters (instead of cheques) Authorizing Payment

12.1 A cheque (or a withdrawal form in a savings bank account) is the correct form of
order to pay, since a cheque is governed by banking law and custom regarding
endorsement, presentation, negotiation and other matters. A simple letter of authority to
pay money from an account may not be so governed to the same extent. It may not,
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however, be possible to rigidly enforce this requirement that all payments should be made
by cheques (or withdrawal forms) and withdrawals on the basis of simple letter of
authority signed by an account holder may have to be permitted.

12.2 Resort to a letter of authority would generally arise when the account holder is away
from the station. In that event, the letter will be received by post or sent with a third-party.
Wherever possible and if in doubt (e.g. where the letter of authority is sent with a third-
party) the account holder should be contacted over telephone to get on the spot
confirmation. Where it is decided to allow withdrawal/payment on the basis of authority
letter, the Branch Manager must satisfy himself that the letter of authority is genuine and
is issued in special circumstances. Noting about the facts to pay should be clearly
mentioned on the letter to safe guard the interest of the bank, it is advisable to pass office
Debit voucher for the sake of clarity and good order.

12.3 It is necessary to take special precaution in such cases of request by account

holders for payment by letter of authority. Branch Manager should authorize withdrawals
under his signature (and not with initials) on the letter of authority and payment voucher.

12.4 A type-written letter of authority warrants greater scrutiny and care. A clever forger
may try to hide his handwriting by using a typed letter. The letter of authority should be
verified both for the handwritten contents and the signature(s) under the Ultra Violet Ray
Lamp irrespective of the amount involved. It should be ensured that the letter is signed
in accordance with operational instructions of the account. Where the amount involved is
Rs. 500/- and over, the signature(s) on the letter of authority should be verified by two
officials.

12.5 When an account holder by a letter of authority requires the Bank to transfer the
amount to his own account either with the same Branch or another Branch or another
bank or to any other account with the same Branch, another Branch or with another bank,
it warrants greater care and scrutiny.

12.6 An advice of debit (Form CD 65A) giving reference to his letter of authority should
be sent to the account holder when action is taken on his letter of authority. The account
holder should be requested to confirm the debit amount and send a cheque/withdrawal
form in support. It must be ensured that the debit advice is in fact dispatched and follow
up action is taken by the officer concerned to get a confirmatory cheque/withdrawal form
or otherwise the account holder confirms the debit by a separate letter. It is understood
that signature of the account holder(s) on such cheque/withdrawal form/confirmation
letter should be verified. To facilitate follow up of confirmation by the account holder, a
note should be taken in the relative account under the initials of the officer checking the
account. The cancelling officer should make an appropriate remark against the note only
after confirmation advice/cheque/withdrawal form is received from the account holder.
Where the amount involved is Rs. 1,000/- and over, the advice should be sent by
Registered Acknowledgement Post recovering postage charges from the account
holder. Capturing the correct mobile number in the account with SMS facility or email to
his registered ID will cater a proof of debit in addition with routine communication modes
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for Debit in account. We may request customer to opt for NEFT/RTGS facility or self/third
party transfer though internet banking along with other alternative channels like
IMPS/IMT/UPI transfers through BHIM etc., These tools will reduce the risk of making
payment without cheque / withdrawal form and avoidable problems in customer service.

12.7 Further debits to the account on the basis of letters of authority from the account
holder should not be allowed unless confirmatory advice/cheque/withdrawal form in
respect of first letter of authority has been received from him.

12 (a) Transaction carried out on the basis of request received from customers
over E-mail / Fax Message:
A separate menu namely “HCONCALL” is available to capture the details and also put
restriction on the verification of transaction created on the basis of request received
through E-mail / Fax for remittances of funds from customer accounts.

Delegated Authority to post the effective transaction in FINACLE after entering &
verifying the details in HOCNCALL menu is as under:

Branch Headed by Authorized Official(#)

Scale I to Scale IV (a) Branch Manager
(b) Designated Officer (not below the rank of
Scale-II) if Branch Manager is on sanctioned
leave.
Scale V (a) Branch Manager
(b) Designated Officer (not below the rank of
Scale-III) if the Branch Manager is on
sanctioned leave.
Scale-VI Branch Manager / Designated Officer not below
the rank of Chief Manager.
# No Deviation allowed.
Before posting the effective transaction in finacle, the above delegated authority must
ensure that:

 the details of request received from customer over email / fax has been entered
and verified in “HCONCALL” menu;
 report is generated and is duly signed by the entering, verifying officer along
with Branch Manager;

All the Branches / Zones are instructed to strictly follow the guidelines and
MANDATORILY capture the detail in new menu “HCONCALL” adhering the new
guidelines before carrying out the effective transactions in CBS on the basis of the
request received through E-mail / Fax.

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In this regard, all Zone/Branches are also advised to take a note that the new guidelines
is an additional preventive measures to be followed by branches in addition to the
existing guidelines circulated / issued by Head Office from time to time.

As this being the most fraud prone area, where chances of entering into dispute
/litigation are more, the branches are advised not to routinely entertain transactions
based on e-mail / fax messages. However, in unavoidable cases, if the branches are
required to do transactions based on the request received over e-mail / fax messages,
then they must strictly follow the laid down procedure and extant guidelines of the bank.

Please refer to the HOBC 117/201 dated 16.11.2023 for SOP.

13. Payment of Cheques to Other Banks over the Counter

13. Branches should carefully scrutinize requests by other banks for payment of cheques
over the counter. The signatures of the officers signing on behalf of the collecting bank
must be carefully verified before payment is made and passed under the full signature(s)
of the authorized officers(s). Payment of cash should be avoided wherever possible. If
cash has to be paid in any particular instance, reasons for cash payments must be clear
and completely satisfactory. The Manager must specifically sanction, in writing, the
payment of cash. Unless specifically requested, payment should be made by Pay
Order/NEFT/RTGS which is passed through the Clearing. At other places, it should be
made by a cheque on the State Bank of India/Reserve Bank of India. In case of RTGS/
NEFT/DD etc., the details of payee to be additionally captured on the reverse of the
cheque which should be tallied with the details furnished in the DD/RTGS/NEFT etc.
form.

Opening of Crossing on Cheques

14. Banks have suffered losses due to fraudulent opening of crossed cheques. It is,
therefore necessary to exercise care and satisfy that the opening (cancellation) of
crossing is genuine before paying cheques (with crossings thereon apparently cancelled
by the drawer). To detect fraudulent opening or crossings, cheques should be carefully
examined under Ultra Violet Ray Lamp. The practice of opening crossings should be
positively discouraged. Opening of a crossing should not be recognized unless the
specimen signature of the drawer is appended and then only when the cheque is
presented for payment by the drawer himself or by his known agent. Where possible and
necessary, the drawer may be approached for confirmation of the cheque. If the drawer
of a cheque on which the crossing has been opened is an upcountry customer, the
cheque may be paid only after proper enquiries about the bona fides of the person
presenting the cheque are made. It may be advisable to ascertain if cash cheques of
similar amounts have been drawn in the past.

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Fraudulent Alterations of Cheques

15.1 W
̏ here a promissory note, bill of exchange or cheque has been materially altered
but does not appear to have been so altered, or where a cheque is presented for payment
which does not at the time of presentation appear to be crossed or to have had a crossing
which has been obliterated, payment thereof by a person or banker liable to pay and
paying the same according to the apparent tenor thereof at the time of payment and
otherwise in due course, shall discharge such person or banker from all liability thereon;
and such payment shall not be questioned by reason of the instrument having been
altered, or the cheque crossed." (Section 89 of the Negotiable Instruments Act.).

15.2 The paying banker is protected against the payment of a materially altered cheque
provided (a) the alteration is not apparent, (b) the payment is according to the apparent
tenor of the instrument and (c) otherwise in due course. It is nevertheless necessary that
all cheques, particularly cash cheques are carefully examined. The cancelling officer
should carefully scrutinize not merely the signature of the drawer but also the general
appearance of the cheque to find out if any erasure of disfigurement is noticeable; he
must satisfy himself that apparently there is nothing to suggest that there are any material
alterations in the cheque.

15.2.1 The adoption of RBI CTS 2010 guidelines the cheques materially altered are not
allowed to be presented for clearing settlement. This protects the presenting and paying
banker from the issues of material alterations of cheque presented in clearing settlement.

15.3 There being no ̏legal obligation" on a bank to examine cheques under Ultra Violet
Ray Lamp in a claim against the Bank for payment of a cheque where fraudulent
alterations are not discernible to the naked eye, the Bank can legitimately take the stand
that the cheque was paid in the ordinary course according to its apparent tenor in the
usual course of business and that the Bank is unable to accept the claim and should
immediately advise the claimant(s) accordingly. A report to Zonal Manager should be
made immediately conveying full details and guidance sought, wherever necessary.
Nevertheless, the staff concerned should continue to exercise due care and vigilance
when putting the cheques, drafts, etc., through the Ultra Violet Ray Lamp. (Also refer
paragraph 16 below).

Ultra Violet Ray Lamp

16.1 Cheques, drafts, etc., are printed on sensitised paper with fugitive ink and each
cheque or draft leaf has the watermark which is clearly visible if the instrument is held
against light. Chemical alteration/erasure on the instrument can be easily detected if
it is held against light as there will be thinning at the spaces where alteration/erasure
has been made. The added security features, design, color and pattern of printing the
bank name along with account number in micro lettering secure the obliteration/
forging cheque. Officers should be aware of this important and vital feature while
carrying out proper scrutiny of the instruments. Utmost care has to be exercised in
examining cheques, drafts, etc., and use of Ultra Violet Ray Lamps is `must' for this
purpose.
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16.2 To prevent encashment of fraudulently altered cheques, drafts etc., where the
alterations are not visible to the naked eye, Branches have been provided with Ultra
Violet Ray Lamp (Path-Finder machine). When cheques, drafts, etc., are closely
examined under Ultra Violet Ray Lamp, the fraudulent erasures/alterations, if any,
are easily visible at all points of time whether proximate or distant. The bleached
writings invariably leave a trace which is also visible any time under Ultra Violet light.

16.3 The examination of the cheques, drafts, etc., should be thorough and the officers
examining the cheques, drafts, etc., should not stop after examining the signature
portion only, because the signature portion of fraudulently altered cheques, drafts,
etc., is almost always untouched. Alterations could be in one or more of the following:

(a) Amount both in words and in figures,

(b) Name of the payee,
(c) Date of the cheque and
(d) Crossings etc.

These should also be thoroughly examined under the Ultra Violet Ray Lamp keeping
in mind the newly introduced security features of design, color, micro lettering on
cheque.

16.4 The Manager should ensure that full and proper use of the Ultra Violet Detector
is being made and that the detector functions smoothly and is always maintained in
good working order. He should also ensure that a spare bulb per machine is at all
times available. If for any reason the Ultra Violet Ray Lamp is not being used, the fact
should promptly be brought to the notice of Zonal Office. Where the electric current
is not steady and there are frequent changes in the voltage, stabilizers to rectify the
occasional voltage deficiency of the current due to fluctuations should be installed.

(Sometimes due to overheating of the bulb, the Lamp may stop functioning. This can
be remedied by switching off the lamp for a short time, until the lamp has slightly
cooled down. In any case, immediate steps must be taken to set the lamp right, cost
of bulb should be debited to P/L Misc. charges).

16.5 Sometimes, however, Ultra Violet Ray Lamp does not function due to failure of
supply of electricity (due to any technical faults or general power cut enforced in the
State) or any technical defects in the Lamp itself. It is necessary for Branches, in such
cases, to exercise more care while scrutinizing cheques etc., before passing them for
payment; in case of doubt, Branches should scrutinize the general appearance of
such instruments, if necessary, with the aid of magnifying glass, the intention being
to satisfy that to the extent possible there is apparently nothing to suggest any
material alteration in the instruments. The cost of magnifying glass for this purpose
may be debited to Profit and Loss Account - Miscellaneous Charges. Branches at
rural unbanked centers, where such magnifying glasses may not be available, may
indent them from the Zonal Office. Needless to add, Branches should take necessary
remedial steps immediately where the Lamp does not function due to any technical
defects in the Lamp itself or arranging for alternate machine in cash department too
347
assist us to run the smooth operations in the branch.

16.6 Branches should maintain a pass book or electronic record in Excel Sheet with
the following columns to record working of the machine(s):

(a) Number of machine (i.e. serial number painted on the machine as recorded in the
Register of Furniture and Fixtures),Date machine went out of order and cause
thereof, if known.
(b) Action taken to set it right,
(c) Date put in order,
(d) Initials of the Officer/Manager and
(e) Remarks.

16.7 At metropolitan/bigger Branches such a pass book or electronic record in excel

sheet may be maintained by the officer usually dealing with stationery, furniture, etc.,
and at other Branches by the second officer or by the Manager (if he is the only
officer). The pass book should be kept up to date at all times. The officer using the
machine must inform the officer maintaining the pass book as soon as the machine
goes out of order. The concerned officer should make appropriate entries in the pass
book and take remedial action immediately.It is mandatory in all branches to keep
Ultra Violet Ray Lamp in working condition, avoiding its use for scrutiny of cheque on
the ground of its stopped working not admissible and acceptable.

Endorsements on Cheques

17.1 “Where a cheque payable to order purports to be endorsed by or on behalf of

the payee, the drawee is discharged by payment in due course" (Section 85 (1) of the
Negotiable Instruments Act). “Payment in due course" means payment in
accordance with the apparent tenor of the instrument in good faith and without
negligence to any person in possession thereof under circumstances which do not
afford a reasonable ground for believing that he is not entitled to receive payment of
the amount therein mentioned. (Section 10 of the Negotiable Instruments Act).

17.2 Where a cheque payable to order purports to be endorsed by or on behalf of the

payee and the banker on whom it is drawn pays it in due course, the banker is
discharged even though the endorsement of the payee or subsequent endorsements
have been forged or made without proper authority. Branches must therefore,
exercise reasonable care in examining endorsements and see that they purport to
have been regularly made by or on behalf of the payee.

17.3 Irregularities in endorsements may occur through a payee failing to endorse

correctly or through an apparently regular endorsement being forged or attached
without authority. If the banker pays a cheque upon an irregular endorsement, he
will be unable to rely upon the protection given in Section 85 (1) of the Negotiable
Instruments Act. Should payment be made to the persons actually entitled, the
drawer's account can be properly debited despite the irregularity. In view of the
348
possibility of fraud, however, it is clearly of the greatest importance that the paying
bank should take great care and observe the requirements of the law. Irregularities
may arise in a number of ways and are commonly caused by inadequate or
erroneous descriptions of the payee or by signatures appended on behalf of payees.

17.4 The following are notes on rules for regular endorsements by different types of
payees and are intended for general guidance of Branches:

(a) A cheque drawn payable to bearer does not require to be endorsed and all
endorsements which may have been placed thereon need not be examined.

(b) A cheque without the words “order" or “bearer" is, nonetheless, payable to “order"
and requires the endorsement of the payee.

(c) Also a cheque with the word “bearer" struck out but without the word “order"
should be treated as payable to the order of the payee and requires the
endorsement of the payee.

(d) If a person presenting a cheque is unable to write, he should endorse the cheque
by a mark (a cross like “X"). This mark should be witnessed preferably by an
independent person known to the Bank. The witness must know the person
whose mark he witnesses, and should give his own address along with his
signature.

(e) Endorsements written in pencil are not accepted as they can be erased.

(f) An endorsement wholly by means of a rubber stamp should not be accepted

unless it is confirmed by the collecting banker. (This practice leaning towards
obsolete due to availability of alternate delivery channels)

17.5 The endorsement should be spelt exactly in the same way as the payee's name
appears on the face of the cheque, or in the special endorsement, as an endorsee. If
the name of the payee or endorsee is wrongly spelt, the endorsement must literally
follow the wrong spelling but the payee or endorsee may add his correct signature
underneath.

17.6 Endorsements in regional languages of the region where Branches operate should
present no difficulty. For endorsements in languages not known to the Bank, the Bank
might be justified in requiring the English translation thereof to be properly verified by a
Notary or a Magistrate, but it is preferable to have the endorsements confirmed by the
collecting bank.

17.7 When the name of the payee of a cheque has the prefix Mr., Mrs., Shri. Dr., or
military or other rank or a title, the prefix or rank or title should not appear in an
endorsement. (In the State of Tamil Nadu, cheques are issued with the honorific “Thiru"
for “shri'', “Thirumathi" for “Shrimathi" and “Selvi" for“Kumari"). A cheque payable to “Mr.
A. B. Chenoy" should be endorsed as A. B. Chenoy (and not Mr. A.B. Chenoy). A
349
cheque payable to Mrs. A. B.Chenoy may be endorsed as (Mrs.) A. B. Chenoy or Amina
Chenoy wife (or widow) of A. B. Chenoy.

17.8 Joint payees when name individually, must endorse individually unless one has
authority to sign for and on behalf of others. A cheque payable to “Mr. A. Raman and
Mr. K. Ramaswamy" should be endorsed as “A. Raman" and “K. Ramaswamy" by them
in their handwriting.

17.9 All alterations in endorsements should be confirmed to the satisfaction of the

paying banker.

Endorsement on cheques by Company/Corporation

18.1 A bill of exchange, hundi or promissory note shall be deemed to have been made,
accepted, drawn or endorsed on behalf of a company if drawn, accepted, made, or
endorsed in the name of, or on behalf or on account of, the company by any person
acting under its authority, express or implied (Section 47 of the Companies Act, 1956).
Every company shall have its name mentioned in legible characters on all bills of
exchange, hundis, promissory notes, endorsements, cheques and orders for money
purporting to be signed by or on behalf of the Company under section 147(c).

18.2 An endorsement “For" or “Pro" or “on behalf of" a principal is not accepted unless
(a) the agent adds after his signature the description of his position relating to the
principal and (b) that position is such that a person holding it would normally have
authority to endorse. The officials who have prima facie authority to endorse on behalf
of a limited company are Directors, Manager, Secretary, Managing Director and the
endorsement on behalf of a limited company by other than these officials (e.g. Cashier,
Accountant) may require confirmation. An endorsement by an Accountant on behalf of
a bank is usually accepted.

The common form of signature or endorsement is :

1) For A.B.& Co. Ltd.,

“X,Y, Z “
Director

2) Per Pro A.B. & Co. Ltd.,

“A.B.C."
Manager/Secretary.

18.3 The above illustration shows the name of the company-the essential thing - as
required by the Companies Act, 1956 followed by the signature of the person who wrote
or impressed it with the designation to indicate that it was done under authority and on
behalf of the company. It is not the practice of the Bank to accept an endorsement on
a cheque, let alone any drawing of a cheque, in the form of mere name of the company
only as there is nothing to show that it was written on behalf of the company by someone
in authority.
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18.4 An endorsement “per pro" indicates that the person signing has limited authority,
but ordinarily it is considered adequate for a paying banker to accept the endorsement
without enquiry. If the paying banker has reason to doubt the authority of a person
signing “per pro", he is entitled to postpone payment till he has satisfied himself that
the authority is in order. The usual form of “per pro" endorsement is “Per Pro A.B.," C,
(C's signature). The words “per pro" usually precede the name of the principal.

18.5 As a general rule, an agent has no power to delegate his authority; he must act
personally. An endorsement signed “Pro-Manager," “Pro-secretary" or “Pro-
Accountant" etc., is not accepted without confirmation. Endorsement by banks signed
“Pro-Manager" are recognised by custom. An endorsement which is not strictly in order
is frequently confirmed by a banker as:

̏Endorsement confirmed
For A. & B. Bank Ltd.
X.Y.Z.
Manager"

18.6 Where a cheque payable to order has been omitted to be endorsed by the payee,
the banker occasionally endorses it:

“̏Placed to the Credit of the Payee's Account”

For A. & B. Bank Ltd.,
C.D.E.
Manager

OR

“Payee's Account credited”

For A. & B. Bank Ltd.,
C.D.E.
Manager

Endorsement by Trustee

19. Trustees must act personally and cannot delegate their authority even to one of
themselves except as provided for in the trust deed or in the Indian Trusts Act. In the
absence of such authority, all trustees must join in an endorsement and a cheque drawn
payable to "Trustees of the late Mr. H. L. Mehta" should be endorsed:

"E. N. Shah,"
“̏B .M. Mistry,"
̏Trustees of the late Mr. H. L. Mehta."

An endorsement "For self and co-trustee of late Mr. H. L. Mehta, E. N. Shah," would
ordinarily require confirmation by the collecting bank.
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Endorsement by Executors and Administrators

20. Executors and administrators may delegate authority amongst themselves but not
to outside parties. A cheque payable to Executors of Ranchhoddas Marfatia is correctly
endorsed:
̏For self and co-executors of Ranchhoddas Marfatia,
A.B."

Endorsement by Proprietory/Partnership Firms

21.1 In a proprietory firm, the proprietor being the whole and sole in charge of the firm
can act alone on behalf of the firm and has prima facie authority to endorse cheques
etc., on behalf of the firm.

21.2 In a partnership firm, each partner can act on behalf of the firm and he has prima
facie authority to endorse cheques etc., on behalf of the firm.

Endorsement by Collecting Bankers

22.1 There may be no obligation on the banker on whom an “order" cheque is drawn to
pay it, if it is not endorsed by the payee, but it is customary to make payment of such a
cheque on the collecting bank's assurance that the proceeds thereof are credited to the
payee's account. As the cheque has not been endorsed, the bank cannot get protection
under Section 85 (1) of the Negotiable Instruments Act. It will have a recourse against
the collecting bank. It is, therefore, necessary to exercise care and discretion in paying
cheques in reliance upon certificates or confirmations of the collecting banks. Branches
may accept certificates or confirmations of other banks if they are satisfied that the
banks concerned are good for the amount involved. Guarantees or certificates by
members or sub-members of the Clearing House may be accepted. Guarantees of
other scheduled banks and state co-operative banks may be generally accepted unless
the amount of the cheque is large compared with the paid-up-capital and reserves of
the guaranteeing bank. Certificates or confirmations of district co-operative banks and
other non-scheduled banks may, if desired, be confirmed by apex co-operative or
scheduled banks; certificates of non-scheduled banks need not necessarily be
accepted, unless such banks maintain accounts with the bank and the amount of the
cheque is relatively not large. The certificate or the confirmation should be signed by a
duly authorised officer of the collecting bank and his signature should be known to the
Bank. All additions and alterations to the usual rubber stamp of the collecting bank
require authentication under the initials of an authorised officer of the collecting bank.

22.2 The collecting bank's discharge must be complete, regular and must relate
properly to the payee who has either not endorsed or has irregularly endorsed. If there
are three endorsements on a cheque or instrument and the second endorsement is
irregular, a mere certificate "Payee's Endorsement Confirmed" is not enough, as it does
not say which endorsement is confirmed. The correct form of the certificate would be:

“First and second payees' endorsements confirmed and third payee's account credited".
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Endorsements by Private Bankers

23.1 Certain proprietary partnership firms are using the word ̏bankers" as part of their
trade name. These private bankers inter alia undertake the following business:

(a) acceptance of current deposits withdraw able on demand not by means of

cheques but by means of withdrawal forms.
(b) collection of cheques for credit of accounts.

(c) lending by way of overdrafts, key loans, discount of hundis, etc.

The section 126 of Negotiable Instrument Act, provides that, where a cheque is
crossed generally, the banker, on whom it is drawn shall not pay it otherwise than to
a banker.

Payment of cheque crossed specially. - Where a cheque is crossed specially, the

banker on whom it is drawn shall not pay it otherwise than to the banker to whom it
is crossed, or his agent, for collection.

The section 128 provide about, payment in due course of crossed cheque and section
129 states, paying banker liable to the true owner for loss when payment not made
in due course.23.2 When a private banker deals through a regular collecting banker,
the responsibility of the paying banker is as under:

(d) If the cheque is a crossed cheque, the paying banker would incur no liability if
he pays the amount of the cheque to the regular collecting banker if it is otherwise in
order. Further, if the endorsements are prima facie in order, no confirmation or
guarantee is required from the collecting banker.

(e) If the cheque is a crossed and marked “account payee'', it would not be in order
for the paying banker to pay such cheques if they do not bear the collecting banker's
guarantee for or confirmation of the private banker's certificate “payee's account
credited." In the absence of such guarantee or confirmation from the collecting banker,
the paying banker would have to rely only on the certificate of the private banker to
ensure that the proceeds are collected by him for and credited to the account of the
named payee only. The “account payee" crossing is the collecting banker's
responsibility, and the only way it could be fixed on the regular collecting banker in
such cases is by requiring him to guarantee or confirm the private banker's certificate.
It would be in order for the paying banker to pay the cheque, where the regular
collecting banker has guaranteed or confirmed the endorsement of the private banker.

Endorsements on Clearing Instruments by means of Rubber Stamps

24. The CTS2010 introduced changed procedure for clearing and settlement through
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GRID (Refer Cash & Clearing for more details). (REFER CIR NO-115/198 DATED
20.10.2021)

Guarantee of Third Party Endorsements on Cheques

25.1 Account holders often request Branches to guarantee third-party endorsements

on cheques lodged for the credit of their (account holder's) account. Confirmation of
payee's endorsements by the Bank involves responsibility and should be done with
discretion. Requests from account holders to guarantee third-party endorsement on
cheques should not be granted as a matter of routine. Each request must be
considered with due regard to the amount of cheque, standing of the account holder
and the circumstances in which the Bank is asked to guarantee the endorsement.
Branches may, without making it a general practice, agree to do so at the specific
written requests of their good account holders provided the account is conducted
satisfactorily and the amount of the cheque is not disproportionate to the average
balance maintained in the account or the means of the account holder.

25.2 This facility should, however, be extended only to good current account holders
whose accounts are satisfactorily conducted. The Bank does not normally accept
third-party cheques for credit of a savings bank account and the question of
guaranteeing the endorsement of a third-party may not arise in such cases. But if, on
a rare occasion a third-party cheque(s) is accepted for credit of a properly introduced,
KYC compliant savings bank account as a very special case, the endorsement may
be guaranteed by the Manager with due circumspection.

25.3 The acceptance of third party cheques in Savings Bank Account is to be

discouraged and is to be permitted only with permission of a competent authority,
as a very special case. If an S/B a/c holder frequently requests for such facility, he
should be discreetly advised to open a current account.

25.4 Since as a matter of rule, third-party cheques are not to be accepted for deposit
in Savings Bank accounts except in special cases with the approval of the
Manager/Deputy Manager/Deputy Chief Manager, the cheque receiving cashiers are
required to exercise precautions while accepting the cheques/refund orders/dividend
warrants etc. in Savings Bank accounts, especially when the name/s of the
depositor/s mentioned in the paying-in-slip is/are different than that appearing on the
instrument tendered. If necessary, reference to account/specimen card may be made
to ensure that the payee is actually a joint account holder in the concerned S. B.
account.

25.5 Branches should obtain an Indemnity Letter (Form CD 104) signed by the
account holder when he makes a casual request to confirm the third-party
endorsement on a cheque. Branches should, thereafter, send a reply to the account
holder (Specimen - Appendix I). Where Branches are frequently called upon to
confirm the third-party endorsements on cheques lodged in the current account
holder's account, it is convenient to take a general Letter of Indemnity (Form CD 101)
to obviate the necessity of obtaining an Indemnity Letter each time the account
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holder requests the Bank to guarantee third-party endorsement. The general Letter
of Indemnity is in the form of an agreement and should be stamped accordingly. The
endorsements of third-parties like firms or limited companies should not ordinarily be
guaranteed.

25.6 Branches may confirm their account holder's endorsements which are not strictly
in order when they receive cheques for collection.

25.7 In joint deposit account (both C.D. & S.B.) with large no. of account holders,
such acceptances/collections of third-party instruments in the past are seen to have
facilitated fraudulent encashment, avoidance of payment of taxes, or money
laundering and routing of benami transactions. As such, as per RBI guidelines, (i) it
is incumbent on banks to examine such requests of third-party endorsements vis-a-
vis the purpose, nature of business of account holders, constitution of account,
economic activity, their financial position etc.25.9 (ii) Account payee cheques payable
to third-parties should not be collected, (iii) Care should be exercised in collection of
cheques for large amounts, (iv) cheques `crossed generally' and payable to `order'
should be collected only on proper endorsement by payee (v) Such transactions
should be scrutinized periodically to ensure timely action, if warranted.

25.8 Acceptance of third party cheque in current account is the accepted practice in
the banking industry. Withdrawal of such facility by our Bank to the exclusion of rest of
the industry does not make good business sense and also runs the risk of loss of
reputation for the Bank. In the course of business, certain calculated risks are required
to be taken judiciously, taking due care of the interest of the Bank. However, considering
the occasions of fraudulent encashment, attempted frauds, etc. this facility is to be
granted very cautiously, after thorough scrutiny by the appropriate authority / senior
officials at Administrative offices / branches.

Return of Cheques (REFER CIR NO-115/198 DATED 20.10.2021)

26.1 The particulars of cheques returned under objection for any reason should be
entered in the Outward Cheque Returned Book (Form CD 13) and the relative
Cheques Returned Memo (Form CD 52) must be initialled by the Manager or the
Deputy Manager or by an authorized officer at larger Branches. Branches should
protect an account holder by advising him direct in the event of his cheque being
dishonored because the signature of drawer thereon differs. It is desirable that the
pass book of an account holder, whose cheque is returned because the drawer's
signature differs, is received for being written up as soon after the return of the cheque
as possible. The branch should endeavor to deliver the returned instrument deposited
for collection by the account holders. Special care must be followed for cheques
returns on financial ground. Updating of the mobile data and making SMS facility
active will immediately inform the account holder about return of the cheque. The
branch should not keep on pilling the returned cheque to avoid aggravating customer
complaints, the rejected cheque should be returned to the account holder via post or
courier within 24 hours.
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26.2 Before a cheque is returned under objection “Account Closed," a reference
should also be made to the Cheque Book Delivery Register (Form CD 17) to ascertain
the correct title of the account; enquiries should be made as to whether the account
is transferred to Unclaimed Balances Account/ Dormant Account.

26.3 Branches should not, normally, make payment against unclear effects. Cheques
drawn against unclear effects should be returned and appropriate charge for "Return
of Cheques" be levied. There may be cases where this rule could safely be relaxed
and some valued account holders accommodated. In such a case, the Manager may
at his discretion and having regard to the standing of the account holder, nature of the
account and other relevant circumstances authorize payment against unclear effects.
Appropriate charges may be made at the discretion of the Manager on each occasion
and the account holder advised (Specimen - Appendix II). Branches should, however
take necessary precautions while allowing to draw against unclear effects even
against Demand Drafts drawn by other Branches Bank as sometimes there is
possibility of these may be spurious drafts or forged/stolen instruments. Branches
should also follow the instruction as detailed in Chapter 3 on “Current Accounts''.

26.4 For return of cheques where the effects are not cleared, the reason ‘Effects not
cleared' only should be stated. The Bank need not suggest in the return memo
‘Please present again'. It is for the presenter/collecting bank to decide and any
suggestion from the paying bank in this regard is unwarranted. When such a cheque
is presented again and there are still no funds in the account (not collected yet), it
would normally be returned with the objection ‘insufficient funds'. The objection
‘Effects not cleared' should not be repeated normally and even in the case of most
valued customers, it may not be repeated more than once. Where we are the
collecting bank, we may re-present the cheque only in deserving cases/valued
customers after levying appropriate charges.

26.5 A number of account holders from time to time issue cheques which cannot be
paid when presented owing to lack of funds. It is very unsatisfactory for a banker to
have to return such cheques unpaid and it may detract from the banker's own
prestige. Branches should deal in a suitable manner with account holders who issue
cheques which they have good reason to believe will not be paid. Strict supervision
by the Manager over accounts where cheques are returned for want of funds is
necessary.

26.6 When there are not enough funds in an account to meet cheque(s), the
cheque(s) should be returned with the standardized answer “Refer to Drawer''. This
should normally satisfy the usual requirements. With a view to enabling the payee to
avail benefits of the penal provisions in the Negotiable Instruments Act, the reason
“funds insufficient" may be assigned in appropriate cases, instead of ‘refer to drawer'.
Branches should, however, note that the words “funds insufficient" are to be used
with utmost care after thoroughly ascertaining that no funds are available, not even
any bill/instrument on collection for which proceeds are awaited or else such words
can be libelous and risky to use.
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26.7 It is a serious matter to damage an account holder's credit by dishonoring a
cheque which ought to have been paid. The customer may take the Bank's lapse to
its logical conclusion. If not, there is every possibility of losing the customer's
goodwill, and in some cases, the customer's business. Besides, the damage done
to the public image of the Bank will be colossal. Thorough enquiries should be made
in other Departments for any amount that may have been received for the credit of
the account, before any cheque is returned for insufficient funds. It should also be
ensured that the balance is correctly extended.

26.8 In any case, before returning a cheque for financial reasons, it would be essential
to consider the relationship of the customer with the Bank. It is possible that the
customer might have banked with the Bank for a good number of years and has a very
satisfactory relationship with the Bank. In other cases, though the account in question
is small or of recent origin, the customer has a very satisfactory dealing in other
accounts either at the same Branch or else-where. In such cases, suitable note should
be made on the account and card about the other accounts he maintains with the Bank.
Sometimes, the drawer of the cheque is a person of respectability and standing in
Government/Private Corporation and his salary cheques are deposited regularly every
month in his account with the Bank. It is nevertheless essential to make necessary
inquiry when returning the cheque for financial reasons (effects not cleared, funds
expected, insufficient funds, refer to drawer etc.). Such cheques which are to be
returned for financial reasons should be referred to the Branch Manager. Normally
authority to return cheques for financial reasons will vest only in the Branch Manager
and in large branches with the Deputy Manager/Deputy Chief Manager. Only in the
absence of these officials can the authority be exercised by the next senior officer.
Whoever exercises this authority would, of course, be held responsible for the decision
taken.

26.9 When a cheque is returned for some irregularity in the cheque itself, such as an
incorrect endorsement or an unauthenticated alteration, etc., the reason should be made
quite clear in the memo, so that no reflection is cast upon the account holder's credit.

26.10 While returning the cheques unpaid as paying banker or collecting banker, please

(i) thoroughly ascertain the position of accounts as regards suitability of funds (to
reckon bills sent for collection too);

(ii) avoid giving general reasons such as ‘Refer to drawer',

(iii) Ensure that the dishonored instrument is returned /dispatched to the payee
promptly, in any case, within 24 hours.

Precautions/Procedure while Returning Cheques for Financial Reasons

27.1 The following procedure should be adopted at the discretion of the Manager for
cheques returned for financial reasons:
357
(a) If a cheque is returned for the first time, the usual advice (Form CD 59) should
be sent to the account holder.

(b) A final notice warning the account holder (Specimen-Appendix III) should be
sent on the second occasion of the return of a cheque for want of funds.

(c) Where it is fairly clear that the account holder has drawn cheques
even though he was aware that the balance was insufficient, a pay-slip for
thebalance of the account (after debiting charges for sending pay-slip) should be sent
after sending Registered Acknowledgement Due Notice (Specimen-Appendix IV).
The acknowledgement or the notice should be carefully preserved.

27.2 A proper record of current accounts in which cheques have been returned for
financial reason should be kept and service charges (which should include charges for
returned cheques) should be levied at the time of each incidence of return of cheque
as per prevailing service charge schedule, the system takes care for charges on return
cheque posting or we have to apply manually MANCHG to avoid revenue loss, or at
the time of closing the account after serving suitable notice.

27.3 When cheques have been returned for financial reasons in a savings bank
account, Branches may consider withdrawal of cheque book facility from the customer
after explaining the position to the customer or even to close the account after giving
due notice, depending upon the circumstances of each case.

27.4 Following additional procedures for dealing in case of dishonored instruments /

cheques for want of insufficient funds

i. While issuing cheque book it will be ensured by branches that the customers are
made aware of the condition that in the event of dishonor of a cheque valuing rupees
one crore and above drawn on a particular account of the drawer on four occasions
during the financial year for want of sufficient funds in the account, no fresh cheque
book would be issued and the Bank is at liberty to close the current account at its
discretion. To this end suitable clause will be added in account opening form and in
case of existing accounts, a letter advising the new condition will be issued while
issuing new cheque book. Till the branches may use rubber– stamps incorporating
the condition covering such dishonor of cheques, which may articulately be affixed
on the obverse side of acknowledgement slip of cheque books so that enough
awareness is created amongst customers. The detail terms and condition along with
general conditions about the saving / current accounts are duly placed at investor’s
corner in our bank’s website.

“I/we confirm having noted that, in the event of dishonor of a cheque valuing
Rs. one crore and above drawn on this account on four occasions during the financial
year for want of sufficient funds, no fresh cheque book would be issued by the Bank.
The Bank may also consider closing this account at its absolute discretion in such
instances.”
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ii. Whilereviewing advance accounts such as Cash Credit, Overdraft account wherein
cheques have been returned for financial reasons as per para (i) above, the need
for continuance of otherwise of these credit facilities and the cheque facility relating
to these accounts should be reviewed by appropriate authority higher than the
sanctioning authority.

As a precautionary measure as and when a cheque is dishonored for third time on

iii.
a particular account of the drawer during the financial year, the concerned constituent
be reminded of aforesaid condition and stoppage of cheque facility in the event of
cheque being dishonored on fourth occasion on the same account during the financial
year. Similarly, cautionary advise will be issued if the bank intends to close the
account.

iv.Zonal Offices will monitor such accounts and ensure that full co-operation is
extended thereby furnishing documentary proof of the fact of dishonor of cheques in
any proceedings relating to dishonoured cheque before a court, consumer forum and
/ or any other competent authority. The Zonal Offices, for the quarter ending June
2003 onwards, will forward the consolidated data of the Zone to MIS Department,
Head Office who in turn will consolidate the same and give to General Operations
Department for reporting to Audit Committee on a quarter to quarter basis. The
collection/extraction of MIS data at Data Ware House level in the present finacle
system provide effective control & monitoring tools regarding cheque return at any
level of our daily banking operations.

v. It
is expected that all the concerned staff members exercise due diligence and avoid
any collusion with the drawer of the cheque for causing delay in or withholding the
communication of the fact of dishonour of the cheque to the payee/holder or the return
of such dishonoured cheque to him.
Cheques Drawn for the Amount stated differently in Figures and in Words

28.1 If on a cheque presented for payment and amount ordered to be paid is stated
differently in figures and in words, it will not be proper to dishonour the cheque with the
reason "Amount in words and figures differs." Such a cheque should be honoured when
presented for payment for the amount stated in words in terms of Section 18 of the
Negotiable Instruments Act, 1881 which reads as under:

"If the amount undertaken or ordered to be paid is stated differently in figures and in
words, the amount stated in words shall be the amount undertaken or ordered to be
paid."

28.2 While implementing this advice, it is imperative that Branches subject such
cheques to greater scrutiny than usual with a view to ensuring that there are no
chemical alterations, etc. Efforts should also be made to contact the account holder
before payment of such a cheque. In any case, the customer must be advised after
payment of the cheque. The varying amount in figures should be rounded in red and
the correct amount (i.e. the amount in words) be super scribed prominently on the
face of the instrument.
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28.3 All care will have to be taken to ensure that the relative entries in the books of
accounts are accurately corrected, and that the clearing account is properly adjusted in
respect of such cheques presented through the Clearing House.

28.4 The payee who is receiving credit of such cheques will also require to be advised
of the correct amount of credit given, through the collecting bankers. If the payee
happens to be the customer of the Bank, the relative counterfoil of the paying-in-slip
should be corrected under proper authentication wherever necessary.

28.5 Branches should; however, put up an appropriate public notice in a prominent

place in the Branch premises advising customers to be careful while writing cheques
so as to avoid discrepancies in the date, amount in words and figures, etc.

Teller System
29.1 In Branches where the "Teller System" was introduced, later merged with the
concept of Single Window Operator (SWO-B/ A) the presenter of a cheque/withdrawal
slip is not to be issued a Token nor is the cheque/withdrawal slip required to be posted
in the ledger before paying it. All that a customer has to do is to present the
cheque/withdrawal slip to the Teller and the latter pays him the money. In some of the
branches where the payment is beyond the prescribed limit of the work class cashier,
the cancelling official attending on the cash counter cancel the payment on the spot and
payment is made to the account holder to avoid spill of time in transaction for better
customer service. For details please refer to Chapter 11 - Cash and Clearing.

II. STOP PAYMENT OF CHEQUES

30. A customer has a right to give notice to his banker to “stop payment" of a cheque
issued by him. Anyone who is party to the account can alone stop payment of a cheque
irrespective of the operational instructions recorded by the Bank in the concerned
account.( Please check with the details mentioned in Chapter 2 regarding instructions
in Joint Account) When an account is in several names and the cheques, of which
payment is to be stopped, is signed only by one of the account holders or by one
partner, a notice from any one of the other account holders or partners is sufficient
authority to justify stopping payment of the cheque. If a cheque is signed by more
persons than one (e.g. by the Secretary and a Director of a limited company jointly or
by two trustees), a notice to stop payment of the cheque from one of them is usually
acted upon.

31. Stop payment instructions should be in writing giving accurate and full particulars of
the cheque such as number, date, amount, name of the payee, etc. It is effective when
it comes to the knowledge of the Bank provided the cheque is not already paid by then.
It is for this reason that the date and time of receipt should be recorded on such
letter/notice. The details of cheque to be returned are entered into the system to avoid
the time discipline regarding presenting and closure of settlement of clearing cheque at
centralized clearing house/grid.
360
32 The signature of the account holder in such instructions should be verified. [The
particulars of stop payment instructions should be noted in the Register / finacle system
for Stop Payment Cheques (Form CD 34).] (Also refer paragraph 35 to 36). The receipt
of stop payment instructions should be promptly acknowledged after ascertaining
whether or not the cheque is paid. If the cheque has already been paid, the date of
payment, mode of payment, name of recipient of the payment, etc. should be advised
to the account holder/ person requested of the stop payment /him at once.

32. A The disclaimer clause “The Bank will Register Instructions from the drawer of the
cheque to stop payment of it, but cannot undertake any responsibilities in case such
instructions are overlooked” should be provided in the terms and conditions along with
general rules at Investor’s corner.

Telephonic or Telegraphic or E-mail Instructions of Stop Payment

33.1 When payment of a cheque is stopped by telephone or telegram or e-mail,

written confirmation by the drawer must be obtained without delay. Payment of such
cheques should be postponed pending confirmation of the stop payment instructions
but care should be taken to see that no damage is done to the account holder's credit
by postponing payment (or returning the cheque unpaid).

33.2 If the cheque is presented for payment before such written confirmation is
received, it should be returned with reasons “Payment countermanded by telephone/by
telegram/by e-mail; payment postponed pending confirmation; present again”.

Stop Payment Instructions by Payee

34. Payee has no right to stop a cheque. But if the payee reports to the bank loss of
cheque by him, the following steps/precautions should be taken:

(a) Precautionary note should be taken in the account.

(b) Payee should be advised to contact the drawer at once and drawer's written
instructions to “stop payment" obtained.

(c) If a cheque reported lost by the payee is presented before the written stop payment
instructions of the drawer are received, the Branch should exercise great care before
paying it. If it is decided to return the cheque, the reason to be given should be "Cheque
reported lost by the payee."

Register of Stop Payment Cheques

35. Branches should maintain a Register of Stop Payment Cheques (Form CD 34)
and enter therein the particulars of stopped cheques. The entries in the register should
be checked by the cheque cancelling officer. Stop payment instruction letters should be
serially numbered in accordance with the entry in the Register of Stop Payment
Cheques and be filed in same serial order in a separate file to facilitate easy location of
the letters when necessary. FINACLE system for Stop Payment Cheques
361
Recording Stop Payment Instructions in the Account

36. Since all our branches are computerized on, CBS etc. full details written in the
stop payment register to be entered by the Counter Staff in the respective account.
These particulars to be verified / authorized by the concerned supervisory staff. The
physical register will help us to document our evidence before the court of law.

Return of Stopped Cheque

37. When a stopped cheque is presented for payment, it should be returned unpaid
with the usual Cheque Returned Memo (Form CD 52) stating the reason "Payment
stopped by the drawer" and the words "Payment Stopped" should also be written in
bold characters across the top corner of the cheque in red ink/ball-point pen. (This will
prevent the risk of payment through oversight if the cheque is presented again). The
date of return of the stopped cheque should be entered against relative entry in the
Register of Stop Payment Cheques.
Withdrawal of Stop Payment Instructions
38.1 If an account holder desires to remove the stop payment instructions, it is
advisable that he issues a new cheque in lieu thereof. Alternatively, the instructions to
cancel or revoke stop payment of cheque which should be in writing and signed in the
same manner as the cheques are drawn on the account may be accepted. The
signature(s) on such a letter should be verified by an officer. Stop Payment Instructions
must be cancelled in the account; a note to the effect should be made in the Register
of Stop Payment Cheques in the "Remarks" column and stop payment instruction
should be removed from the account. The customer's letter should be acknowledged.
38.2 Respective Software – Package stores the data and information of Stop
Payment instructions for individual accounts.

III. POWERS OF ATTORNEY/MANDATE LETTERS GRANTED BY

CURRENT/SAVINGS BANK ACCOUNT HOLDERS

39. The customer may authorize, for his convenience, an agent or nominee to
operate on his account. Such an authority is given either by way of Mandate Letter or
Power of Attorney. By mandate letter the particular banker is informed that certain
powers have been delegated whereas a power of attorney acts as a general notice
and authority.

39.1 Considering the prevailing trends, the POA should be registered through court
of law, it should not be notarized public. The court registered POA contains the full
KYC of the parties executing/undertaking POA and clearly identifiable. This court
register POA will protect our interest to the fullest possible extent.

40. A power of attorney may be special or general. A special power of attorney

authorizes a person to act in a single transaction whilst authority to act in more than
one transaction such as a bank account or generally, is a general power of attorney.

41. The power of attorney is a stamped document. A power to operate an account

362
will not include, by itself, a power to overdraw or borrow money. Authority or power to
borrow by the attorney should definitely/explicitly be stated/embodied in the
instrument. Drawing on an overdraft account is borrowing.

42. If the joint account holders wish to empower an agent or a nominee to operate
on the joint account, the authority must be confirmed by all the account holders. A
power of attorney (or mandate letter) authorizing a person to operate upon a joint
account must be signed by ALL THE JOINT ACCOUNT HOLDERS. A joint account
holder, who has an authority to operate on the account, cannot delegate his authority
to an agent or a third-party without the written consent of the other joint account
holders. For details regarding power of attorney and mandate letter, please refer
paragraphs 48 to 50.

Power of Attorney/Mandate Letter in Partnership Accounts

43. In a partnership firm account no person should be allowed to operate as an

attorney (or an agent) unless he is authorized to do so by a power of attorney (or
mandate letter) executed by all the partners. The power of attorney (or mandate letter)
purporting to give such authority executed by one or more partners (but not by all the
partners) cannot be accepted as sufficient even though the partner or partners
executing the power of attorney (or mandate letter) purport to do so on behalf of the
firm. A person holding a general power of attorney and having authority thereunder
to operate on the account of the grantor cannot, by virtue of that authority, be
permitted to operate on the account of a firm in which the grantor may be a partner.
For example, "A" who is a partner in A. B. & Co. has given "D" a general power of
attorney to act on his behalf. "D" cannot, by virtue of authority under the power of
attorney given to him by "A" operate on the account of the firm A. B. & Co.

Power of Attorney in Joint Hindu Family Firm Accounts

44. In a Joint Hindu Family Firm Accounts, the Karta is the person who acts on
behalf of the joint family or firm. A Karta can delegate his authority to one or more of
the major co-parcners under a power of attorney. The other co-parcners should be
asked to confirm such power of attorney, wherever possible.

Power of Attorney in Limited Company Accounts

45. In the case of a limited company, power to appoint an attorney depends upon
the provision in its Articles of Association. A specific authority in the Articles in this
respect is necessary in order to enable the directors to delegate their powers to
others. Powers of attorney are usually granted by a limited company under its
common seal. (Also refer paragraph 50.7)

Recording Power of Attorney/Mandate Letter

46. Branches should make appropriate note against the specimen signature of the
attorney obtained on the account opening form/card/slip to the effect that the account
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is operated under the authority of power of attorney/mandate letter so as to draw the
attention of the canceling officer. This is also essential since the Bank has to exercise
certain restraints in such accounts. The registration number of the power of attorney,
the court of registration, authority and date of registration in Bank's books should also
be recorded thereon. (Refer paragraph 49).

Cheques favouring Donee (or Mandatory)

47. Branches should not accept without proper enquiry cheques drawn or endorsed
in favour of the donor (or mandator) for credit of donee's (or mandatory's) personal
accounts. Similarly, cheques drawn by the donee (or mandatory) on the principal's
account either in favor of himself or in favor of third-party should not be credited to
the account of donee (or mandatory).

Powers of Attorney

48.1 Powers of attorney when received by Branches should be promptly

acknowledged to the donor.This is particularly necessary where a donee brings the
document to the Bank for registration.

48.2 The power of attorney should be carefully scrutinized and Branches should
pay careful attention to see that:

(a) the power of attorney is not acted upon or registered unless it is adequately
stamped according to the provisions of the Indian Stamp Act or other stamp law
in force in the State. A power of attorney executed outside the Indian Union for
use in India must be stamped in accordance with the Indian Stamp Act within 3
months after it is first received in the Indian Union. The registered document
contains the KYC of the POA donor and done with specific details to operate
the account/ financial transactions and lacks any limitation/ conditional clauses
hampering the interest of the donor/account holder.

(b) the identity of the person claiming to act as an attorney must be verified to the
satisfaction of Manager. This may be done by getting the signature of the
donee attested by the donor.

(c) the power of attorney is ACTUALLY IN FORCE.

(d) the power of attorney covers the purpose for which it is proposed to be used.

48.3 It is essential that the signature of the executant of a power of attorney should
either be known to the Bank or be otherwise properly verified. It is advisable that in
the case of a power of attorney granted by a person or a small institution whose
identity cannot be unquestionably established, the executant's signature thereon
should be attested either by a Magistrate or Advocate or Solicitor or Notary Public. In
the case of a power of attorney executed outside India, the donor's signature should
be attested by a Notary Public. The power of attorney should normally not be attested
by husband or wife of the donor of the power, as the case may be, nor can it be
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attested by the attorney himself.

48.4 A power of attorney must be definite and not provisional or contingent. A power
of attorney contingent upon an eventuality such as "during my illness" or "during my
absence" should not be accepted as the recovery or return of the donor would
automatically revoke the power without the Bank necessarily knowing of such
revocation.

48.5 A power of attorney does not authorize any act which is not specifically
mentioned in it. The authority embodied in a power of attorney must be rigidly
interpreted, e.g.

(a) Power to operate on the account does not include power to open account with
the Bank.

(b) Power to draw cheques does not include power to draw or accept bills of
exchange.

(c) Power to draw a bill of exchange does not confer the authority to accept or
negotiate a bill of exchange. An attorney cannot negotiate a bill unless
expressly authorized.

(d) Power to draw cheques on a credit account does not imply power to draw
cheques which would render an account overdrawn or increase the existing
overdraft in the account.

(e) An attorney has no power to borrow unless he has a clear and unambiguous
authority to do so under the power of attorney. Drawing on an overdraft account
is borrowing.

(f) An attorney cannot give indemnity/guarantee unless specifically provided.

(g) Power to pledge or give any other kind of security must be specifically
authorized.

(h) An attorney cannot delegate his powers to another person except under the
clearest authority to do so under the power of attorney and to the extent therein
allowed.

48.6 It would be impracticable to lay down in any power of attorney, no matter how
great the number of specific clauses, all those incidental acts which are necessary to
the carrying through of the main purposes and this is accomplished by the insertion
of general clause reading - "In general, to do all other acts, deeds, matters and things
of whatsoever kind or nature as fully and effectually as the donor can do". SUCH A
GENERAL CLAUSES MUST NOT BE READ BY ITSELF BUT ONLY IN RELATION
TO THE SPECIFIC CLAUSES WHICH PRECEDE IT. The general clause in a power
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of attorney merely extends the operation of a specific clause to cover transactions
which are necessary or ancillary to give effect to that specific clause and it is not
intended to extend or amplify the attorney's authority to do substantive acts which are
not specially authorized to be done. Most powers of attorney contain a clause
whereby the donor undertakes to ratify anything which the attorney may lawfully do
or cause to be done but it would be most unwise to rely on this clause to cover
transactions which are not unquestionably provided for in the instrument.

Power of Attorney Register

49.1 Branches should give a registration number to each power of attorney etc.
received by them in original under the Branch stamp and initials of an officer. A
complete copy of power of attorney or a relevant extract accepted by the Branches
must be kept on record in Power of Attorney Register (Form CD 127 A) duly
pasted/stapled/copied by hand. In addition, if a power of attorney has been registered
by other institutions such as Reserve Bank of India or other Well-known bank, the
names of these institutions and their registration numbers should be noted in the
Power of Attorney Register.

49.2 After registration a synopsis thereof should be made with particular references
to the following forthe sake of easy reference:

(a) name of account (or donor),

(b) name of beneficiary/attorney,

(c) particulars of power so embodied in the Instrument concerning the operation of

Bank accounts,

(d) has the beneficiary power to borrow, power to pledge, power to delegate his
powers to another person and

(e) any limitations contained in the power of attorney in respect of business

transactions, banking operations in the donor's account.

49.3 Besides power of attorney, other documents such as Probates or Letters of

Administration, Succession Certificate, Partition Deeds, Trust Deeds, Death
Certificates, etc., should similarly be registered in the Register.

Mandate Letters

50.1. A letter of mandate is addressed by a customer to the Bank informing that

powers to operate the account (ordinary deposit account) have been delegated by the
customer (the mandator) to a particular person (the mandatory). Such letters of
mandate do not attract stamp duty.
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50.2. As far as possible, Branches should require customers to execute powers of
attorney when they desire to authorize their agent or nominee to operate on their
account on a more or less permanent basis. The procedure of obtaining mandate letters
instead of powers of attorney should, as far as possible, be limited to operations on
ordinary credit accounts. Should the rigid insistence on a regular power of attorney be
likely to result in the loss of a good account, Branches may accept a mandate letter
(Specimen-Appendix V) in the following cases:

(a) Accounts of individuals.

(b) Joint accounts in the names of two or more individuals. (The mandate letter
should be signed by all the parties to the account).

(c) Accounts of proprietary or partnership firms. (The mandate letter should be

signed by the proprietor or all the partners for and on behalf of the partnership
firm).

50.3 The proper mode of signature by agents acting under the mandate letter is
"Per Pro" followed by the principal's name, which should be followed by the agent's
signature. For example, if "A" has given authority by a mandate letter to his agent "B"
to operate on his account proper mode of "B's" signature should be:

Per Pro "A"

"B's" signature.

50.4 The Manager may at his discretion obtain fresh mandate letters after say two
years or other appropriate period. It is of the utmost importance that the account
holder himself confirms the balance on the usual balance confirmation letter in an
account where the mandate letter is held.

50.5 It should be seen that the mandatory does not exceed any of his powers or
delegate his powers to others.

50.6 A REGULAR POWER OF ATTORNEY SHOULD, AS A RULE, BE REQUIRED

IF THE AGENT OR THE NOMINEE IS TO OPERATE ON AN ACCOUNT ENJOYING
BORROWING FACILITIES.

A mandate letter should not be accepted in trust account. (Proper practice is to require
trustees to give a regular power of attorney provided that delegation of powers of all
trustees is expressly permitted by the trust deed etc.).

50.7 Branches should observe the usual practice of requiring limited companies to
grant regular power of attorney to their agents instead of mandate letters. A limited
company can, however, grant authority to certain of its employees by a proper
resolution passed by its Board of Directors to operate on the company's account. A
copy of such a resolution, certified true by the Chairman of the meeting at which it
was passed, should be obtained for the Bank's record. Before allowing operations on
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the strength of such a resolution, the Manager should make sure that the Articles of
Association of the company concerned expressly authorise its Directors to delegate
their powers and exercise care to see that the authority granted to the person in terms
of the resolution is not exceeded by him.

Revocation of Power of Attorney/Mandate Letter

51.1 The authority granted to an attorney to operate on the account is revoked

EITHER by specific instructions by the account holder(s) which should be in writing,
OR
(a) Where the donor (or mandator), or one of the donors (or mandators) is deceased
becomes insane, insolvent or bankrupt;
(b) Where there is more than one attorney with power to all of them to act JOINTLY
the power is revoked on the demise of one of them.

51.2 A notice of cancellation by one of the donors (or mandators) will also have the
effect of withdrawal of authority.

IV. MISCELLANEOUS INSTRUCTIONS

Cheque Books

52. Cheque books for current and savings bank accounts are distinct from each
other. A cheque book contains 50 or 100 cheque leaves in the case of current
accounts and 25 or 50 leaves in the case of saving bank accounts.

53. We have started with centralized printing of the Cheque book and customers
can indent the cheque book on line. The branch should invariably indent the cheque
book through finacle for request made at branch. The cheque books which were
returned back from the printer/supplier on the branch address should be kept properly
and delivered within 1 week to the related account holders by contacting them
personally.
54. The branch should hold minimum cheque book stock under dual control to
avoid the fraud and dissatisfaction to the account holders. The data should be kept in
excel format to apply proper control and monitoring.
55. Branches should display, a notice reading on the cheque book overleaf or
cheque book provided in Welcome Kit :
"ACCOUNT HOLDERS ARE REQUESTED TO EXAMINE CAREFULLY THE
CHEQUE BOOKS ISSUED TO THEM AND TO VERIFY THAT THE NUMBER OF
FORMS IN EACH CHEQUE BOOK ISSUED IS CORRECT AND THAT THE
RUNNING NUMBERS OF CHEQUES ARE IN SERIAL ORDER."

56. While issuing a cheque book in an account for the first time, it should be
invariably ensured that the application is given in Form CD 63A in case of C.D.
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account (a part of account opening form) or Form SB 339 in case of S.B. account.
The form should be signed by the accountholder/s as per his specimen signature and
in accordance with the operational instructions which is to be verified and cancelled
by an officer. Such form should also be presented by the account holder in person.
In exceptional circumstances, the Deputy Chief Manager/Deputy Manager/Manager
may waive this condition after fully satisfying himself about the bonafide of the
presenter/representative. In such a case, proper and prompt follow-up should be
made with the account holder/s regarding receipt of the cheque book. The branch
should also, in such cases, send a written communication to the account holders
advising of having handed over the cheque book to his/their representative and
requesting them to confirm having received the cheque book with all leaves intact.

57.1. On presentation of the cheque book request form, a cheque book token
should be issued to the person presenting it after obtaining his signature and
recording the token number on the reverse of the form. The cheque book should be
handed over after receiving back the relative cheque book token. (Also refer the
Chapter on `Deposits - General').

57.1 A. A rubber stamp "New Account" should be put on all the leaves of
cheque books issued to a newly opened account such time that the
Manager/concerned Branch Official is satisfied about the bonafides of the account
holder. In quite a few cases frauds have been perpetrated 7 to 10 months after the
opening of the accounts. The intervening time gap was used for familiarizing and
personalization. An event-less period of 6 months to 1 year cannot be said to be an
indication of the account holder's honest intentions. As such, it would not be proper to
specify any definite period for which the stamp "New Account" should be affixed on
cheque forms issued in a newly opened account. Branches should, therefore, use their
discretion in regard to discontinuation of such stamping with due circumspection.

57.1. B. While issuing cheque book for the first time, in new deposit accounts or
even in old accounts where cheque book has so far not been issued, proper enquiries
should be made before delivery of the cheque book.

57.1. C. While issuing a cheque book, the supervisory staff should sign the in-
built requisition slip in the cheque book in full and write his/her signature code number
also and affix round stamp of the branch thereon. While noting the particulars of the
new cheque book series in the account, the staff should also note the date of issue
of the cheque book against the same.Currently the system takes care of these
requirements.

57.2. Members of the staff at Branch should be alert when a request for a cheque
book is received for the first time after the savings bank account has earlier been
operated by withdrawal slips. In such cases, no cheque book should be issued unless
the customer personally calls at the Branch to prove his identity or alternatively the
cheque book should be sent by Registered and Acknowledgement Due Post to his
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address as per Branch record. In SB account the cheque book may be delivered to
the customer’s address upon his request from the centralized location. However, in
case of CD account, the cheque book has to be collected from the branch. Requisition
of cheque book can happen through Branch, ATM, SMS and Internet Banking.

58.1 At the time of issue of subsequent cheque Books, before cancelling the
signature(s) of the concerned account holder(s) on the cheque book request forms,
cancelling officers should ensure that staff have verified that the cheque book request
forms are from cheque books issued to the account holders and are not reported lost
or misplaced. Before a new cheque book is issued, it may be considered whether the
account is undesirable or unremunerative or that the account holder is not already in
possession of a large number of unused cheques.

58.2 In an existing account in which a cheque book has been issued and an
application for a new cheque book is made on a loose cheque book request form
instead of the printed cheque book request form inserted in the cheque book issued
to the account holder or by a letter purported to have been signed by the account
holder, the account holder should be asked to call at the Bank (with the pass book in
case of savings bank account) and should be identified properly before a fresh cheque
book is issued to him. The officer should ascertain the reason for not presenting the
cheque book request form from the cheque book issued to him. If the cheque book
request form is reported to be lost or misplaced the account holder should be asked
to call at the Bank and to give a letter to that effect, along with an indemnity for loss of
requisition slip provided by the bank. Where it is not possible for the account holder to
call at the Bank in person for genuine reasons, a suitable letter should be sent to him
at his address recorded with the Bank and the fresh cheque book issued only on
receipt of confirmation from the account holder. This signature of the account holder
on the letter should be verified and initialled by the officer. If the lost/misplaced cheque
book request form is subsequently presented for issue of a new cheque book, the
counter staff should bring it to the notice of the officer. A new cheque book should not
be issued against such a request form. The account holder should be sent for. The
officer should ascertain from him and satisfy himself about the circumstances in which
the cheque book request form which was reported lost/misplaced was traced. The
request form presented should be destroyed after cancelling the earlier note in the
account under initials of the officer. A new cheque book may be issued only against
the request form, from the "current" cheque book in use by the account holder,
provided the account holder is not already in possession of a large number of unused
cheques.

58.3 While issuing cheque books to the account holders, it should be ascertained
whether there is proper utilization of cheque books issued earlier to ensure that these
are not extensively misused.

59. When a cheque book is issued to an account holder(s), his name and the date
of issue should be noted against the relative entry in the Cheque Book Delivery
Register (Form CD 17 or SB 329, as the case may be) under the initials of an officer.
In the case of savings bank accounts ledger page number should also be entered in
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the column provided in the relative Cheque Book Delivery Register.

60. When a cheque book is issued, the name of the account and account number
(where applicable) must be written on the cover of the cheque book and on the
cheque book request slip bound in the new cheque book. The account number is
printed on in all cheque leaves of the book issued to savings bank / current account
holders. The cheque book acknowledgement letter (with printed numbers of relative
cheque forms) is supplied as the first page in each cheque book. The name and
address of the account holder should be entered in the space provided in the letter.
If the account holders personally call at the Bank to collect the cheque books, the
acknowledgement letters should be got signed and detached preferably before the
account holders leave the counter. They should be requested to count the number of
cheque leaves in the book and thereafter sign the letter. In other cases before issuing
or dispatching the cheque book by post the letter should be detached from the cheque
book and sent separately (and not with the cheque book) to the account holder(s)
promptly along with an unstamped envelope addressed to the Bank for the account
holder to sign and return the acknowledgement.

61. Sometimes, it may become necessary to issue more than one cheque book at
a time to an account holder/s having regard to the magnitude of operations in their
account. On such occasion, before handing over/dispatching the cheque books to the
account holders, it should be ensured that the cheque book requisition slips in all
cheque books to be issued (except the last one in the serial order) are removed and
destroyed from the cheque books after making a proper note in the Cheque Book
Delivery Register. For subsequent issue of cheque book(s), the requisition slip in the
last cheque book would naturally be used by the account holder.

62. The series of the new cheque book issued should be noted on the requisition
slip against which the new cheque book is issued. The slips should be sent to
concerned staff who should enter the cheque series (noted on the requisition slips) in
the respective accounts. Checking officers should check the entries. Thereafter the
requisition slips may be filed (in pasting files) and should not be accessible to
unauthorized persons.

63. When the cheque book acknowledgements are returned by the account
holder(s) duly signed, the cancelling officer should verify and cancel the signatures
thereon and write "Ackd." (With the date of receipt) against the cheque series. If the
cancelling officer finds that the signature on the acknowledgement letter differs from
the specimen signature on record, he should scrutinize the signature on the relevant
requisition slip and satisfy himself thoroughly that the signatures on both, the
requisition slip and the acknowledgement are of the account holder(s). Thereafter,
the officer-in-charge of cheque books should mark the dates of acknowledgement
letters in the Cheque Book Delivery Register. The acknowledgement letters should
be pasted in a separate pasting file maintained for the purpose.

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64. Periodically, i.e. at least once in two weeks, the officer-in-charge of cheque
books should inspect the Cheque Book Delivery Register and send reminders in all
cases where acknowledgement letters have not been returned for ten days or more.
(The intention in sending reminders at intervals is to ensure that cheque books have
actually reached the account holders. If the Manager is thoroughly satisfied after
referring to the account that the cheque book has been received by the account holder
a reminder need not be sent).

65. Counter Staff should draw the attention of the cancelling officers, when a
cheque from a cheque book for which acknowledgement is not received is presented
for payment. The cancelling officer should take particular care to scrutinize the
cheque when it is presented for payment to guard against a possibility of the cheque
book having been delivered to unauthorized person(s).

Cheque Books Issued to Upcountry Account Holders

66.1 All cheque books issued to upcountry account holders should, as a rule, be
sent by registered post. Cheque book requisition slips in cheque books issued to
upcountry account holders should be marked by rubber stamp "Upcountry - By Post"
Counter Staff (or those dealing with issue of cheque books) should not issue cheque
book tokens against the cheque book requisition slip marked "Upcountry - By Post",
without reference to the cancelling officer. (This precaution is necessary to obviate
the possibility of unauthorised persons who have fraudulently obtained the cheque
book requisition slips in transit exchanging them for new cheque books. Ordinarily,
an upcountry account holder is unlikely to ask for a cheque book over the counter;
he would send the requisition slip by post). The cancelling officer should, therefore,
satisfy himself of the bonafides of the applicant and, if satisfied; remove the note
"Upcountry - By Post" under his initials and cancel the signature of the account
holder on the requisition slip, if in order. Cancelling officers should exercise more
than usual care in dealing with such cases.

66.2 Sometimes an account holder may request the Bank to send a cheque book
at his temporary address. It should be sent by registered post or by the Bank's hand-
delivery sepoy where feasible. A separate intimation advising issue of cheque book
must be sent to the account holder at his permanent address also. In all such cases,
Branches should follow up and obtain acknowledgement of the cheque book from the
account holders.

Issue of Loose Cheque Forms (It has been discontinued)

67.1 A record of cheque books used for issue of loose cheque forms should be
maintained preferably in a separate section of Cheque Book Delivery Register. A
separate cheque book (or a complete cheque book returned unused by an account
holder) should be kept for the issue of loose cheque forms. Slowly, this practice
should be avoided to have better monitoring as various other alternate delivery
channels are being implemented. Check whether loose cheque leaves are being
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issued. It has been discontinued.

67.2 In cases where an account holder has not brought his cheque book and wishes
to draw cash, payment should be allowed only against a loose cheque to be issued
by the Branch. If it is a saving bank account with cheque book facility, it should be
ensured that under no circumstances withdrawal is allowed by means of withdrawal
forms. (This rule is also applicable to accounts of staff members with cheque book
facility).

67.3 Loose cheque form should be issued on application in person by an account

holder (or a person authorized to operate on the account) and its use should be
restricted to cash payment to the account holder (or the person authorized to
operate on the account) only - loose cheque form should not be used for payment
to third-parties. A loose cheque form should not be issued to servants and
messengers of account holders. Usual precautions for scrutiny of cheques before
payment must, however, be followed.

67.4 Unless an account holder is known to the cancelling officer, loose cheque form
should be supplied only after the account holder's signature (on his application for a
loose cheque form) is verified under the initials of the officer. The counterfoil of the
loose cheque issued should state the date of issue, the name of account holder and
the amount with the specimen signature of the account holder. The counterfoil should
be initialed by the cancelling officer. The word "Loose cheque" should be entered on
the top of the loose cheque form and the cancelling officer should sign below these
words. The cheque should be posted in the account and cancelled thereafter in the
usual way.

67.5 In case of necessity to issue a loose cheque, normally passbook should be

insisted upon. However Manager/Deputy Manager/Deputy Chief Manager may
waive this at his discretion in deserving cases.

67.6 Requests for cheque book issuance through SMS/Tele / Internet Banking
Modules in MBB / CBS branches to be followed as per respective procedure stated
separately for respective types of branches.

67.7 The printing of Multicity cheque book has been discontinued w.e.f. 01.04.2010.

Balance Certificate

68. The account holder(s) may require a certificate for the balance in their bank
account(s) as on a certain date. Balance Certificate (Form CD 70) may be issued only
on a written request from the account holder(s) or in accordance with standing
instructions. The balance to be shown in the certificate should be the clear balance
as at the close of a day. In case an account holder requires a stamped balance
certificate, the cost of revenue stamp should be recovered from him. Also refer to
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manual of service charges to be levied for providing the certificate

68.1. The account holder(s) may also get Balance certificate through other delivery
channels line, Internet Banking etc.

Transfer of Funds from One Account to Another

70.1 No transfer of funds from one account to another should be allowed without
the written authority of the account holder(s) from whose account funds are being
transferred. Such authority letter should be signed in the same manner as the
cheques on the account are signed. The signature(s) on the letter of authority should
be verified by the cancelling officer before effecting transfer of funds. Preferably the
account holder(s) should be requested to send a cheque for the amount transferred.
(Also refer paragraph 12).
70.2 Saving bank withdrawal form should NOT be accepted for inter-account transfer
of funds (i.e. transfer of funds from one saving bank account to another). Such
transfer of funds should be effected only by passing separate vouchers on the basis
of an authority letter signed by the account holder. This rule would apply in case of
accounts of staff members also. However, in the case of savings bank account (from
which the funds have to transferred to another account) with cheque book facility, the
cheque should be accepted for inter-account transfer of funds.

71. It sometimes happens that a Branch having various accounts of sister concerns
having identical partners is requested to transfer moneys from one account to another
account when the balance in one account falls short to meet payment of a cheque
drawn on it. Such requests should normally be declined but where, in the interest of
the Bank's business, it is considered expedient to do so, Branches may obtain a
general letter of authority indicating the names of the concerned accounts and the
names of the parties concerned in each of such account. The general letter of authority
should be signed by all parties to all the accounts on behalf of the firms of which they
are partners and in their personal capacities.

71.1. The transfer of funds on the basis of phone call or e-mail should not be solicited
from the account holders. These being the most fraud prone area, where chances of
entering into dispute /litigation are more spurious. We have to execute controls and
tactfully handle such request from our customers.

72. When a respectable account holder(s) requests the Bank on telephone to

transfer the funds from his account to another, it may be done on a rare occasion and
only under special circumstances at the discretion of Manager with due caution and the
account holder should be requested to send a cheque in due course which when
received should be kept with the debit voucher. The Manager should follow up the
matter and ensure that the cheque is received in due course. The Manager acting upon
such telephonic instructions must be quite familiar with the voice of the person giving
the instructions for transfer of funds. It is advisable to decline such request and make
the account holder aware about the threats and risk associated with such fund transfers.
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73. Such transfer of funds should be effected by means of Debit Voucher-cum-
Advice (Form CD 65 B) and it should be seen that the advice is sent to the account
holder(s) whose account is debited. It must be clearly indicated in the advice that the
transfer of funds has been effected under the specific general authority or telephonic
instructions given to the Bank by the concerned account holder. In the case of a casual
transfer, the letter of authority should be pasted to the relevant debit voucher in such a
way that the signature(s) thereon and the amount mentioned therein are not obliterated.

Acceptance of Deposit (Cash / Cheque) for the Credit of an Account at Any other
Branch:

74. All the Branches of the Bank are now on CBS platform. It is possible to deposit
cash / cheque at any Branch for credit to an account maintained by the customer at any
Branch. Subjected to cap on the amount and service charges decided from time to time.

Usual procedure regarding acceptance and credit to the account must be adhered to
for deposits at other than home branch/es. Similar usual precautions must be taken and
procedure must be followed for collection and clearing of cheques

For details please refer chapter on cash and clearing.

Transfer of Accounts from One Branch to Another

75. When a current/savings bank account holder desires his account to be

transferred from one Branch to another, he should be requested to make an application
to the Branch (where he maintains the account) to transfer the account to another
Branch where he desires to transfer his account. The application should be
accompanied by the pass book (where applicable), a crossed cheque/withdrawal form
(duly signed by the account holder in blank) drawn in favor of the Bank and unused
cheque forms (where applicable). The application should be signed by the account
holder in the same manner as the cheques/withdrawal forms are drawn on the account.
Now, as per account number portability, the account number will remain same, only
the KYC Details of the new place, SOLID will get changed at the transferee branch.
The branch should follow Ongoing Due Diligence (ODD) & Continuous Due Diligence
as per stipulated periods for KYC updates in all accounts. The Request for account
transfer can be placed at either the transferor branch or transferee branch.

75.1. At the new Branch fresh KYC must be done before allowing operation in the
same.

75.2. If the request is received at the Branch where the account is maintained, the
Branch should obtain a fresh account opening form/card etc., duly completed and
signed by the account holder(s) for use at the Branch where the account is required to
be transferred. Every signature on the fresh account opening form/card etc., should be
authenticated by the initials of an officer of the Branch and a stamp "Signature(s)
Verified" should be affixed thereon and signed in full by an authorized officer under his
code number. The Branch should not part with the existing account opening form/card
etc., from its own record for the use of the specified Branch.
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75.3. Considering the Account number portability, the procedure to physical close and
transfer the account should not be followed in saving/ Current Account. Instead of
following the long drawn way prescribed over here, the portability will be less
cumbersome and more update. Still, if the account holder desire to close and transfer
the account, then only, after the signature of the account holder on the application is
verified and cancelled, if in order, the blank cheque/withdrawal form should be filled in
for the final balance repayable, the account should be closed and the balance
transferred by a mail transfer to the specified Branch. The fresh account opening
form/card etc., completed by the account holder with his signature verified should be
forwarded to the concerned Branch along with the Credit Authorization Note. In case of
savings bank account, the Credit Authorization Note should state whether the account
was introduced, the balance in the account before application of interest and the amount
ofinterest, (Interest should be applied in savings bank accounts up to the end of
preceding day). The statement of account/pass book should be written up to date and
returned to the account holder and the unused cheque forms destroyed after making a
note in the ledger page and Cheque Book Delivery Register. The transferor Branch may
furnish a confidential report on the means, standing and respectability of the account
holder, especially in the case of a current account.

75.4. The transferor Branch should send the Credit Authorization Note and the
account opening form/card (with the signature of the account holder duly verified) in
that order separately to the transferee Branch, the intervening period being not more
than two days. The form/card will be sent under a covering letter signed by the
Manager/Deputy Manager in charge of Deposits under his code number. At the
transferee Branch, such new accounts will be opened after being authorized by the
Manager/Deputy Manager in charge of Deposits. The transferee Branch, on receiving
the account opening form/card and the Credit Authorization Note must carefully verify
the signature of the Officer of the transferor Branch on the account opening form/card
and on the Credit Authorization Note before responding to it. In case of doubt,
confirmation from transferor Branch should be sought by telegram - where possible by
tested telegram to ascertain the genuineness of the Credit Authorization Note. While
permitting large immediate withdrawals from accounts opened by means of Credit
Authorization Note, extreme care should be exercised. (Also refer to paragraph 4
above).

75.5. Sometimes the customer may desire to carry with him letter, demand draft, etc.,
from the transferor Branch to the transferee Branch to avoid delay in transfer/opening
of his account at the transferee Branch. The customer may be allowed to do this if he
so desires. The following procedure should be followed in addition to the instructions
contained in paragraph above:

i)The transferor Branch should follow the usual procedure except that instead of
remitting the balance by a Credit Authorization Note, a Demand Draft drawn on the
transferee Branch in favour of ̏Bank of India Account (name of the account
holder)"should be prepared.

ii) The transferor Branch should also prepare a forwarding letter as per specimen
376
given in Appendix VI addressed to the transferee Branch.

iii) The original forwarding letter, Demand Draft and the fresh specimen signature
card (with signature(s) of the account holder(s) thereon duly verified) should be given
to the customer in a sealed envelope addressed to the transferee Branch. While
handing over the sealed envelope to the customer his signature should be obtained
on the office copy of the forwarding letter, as an acknowledgement.

iv) A copy of the forwarding letter along with the relevant draft drawing advice
should be sent separately by post to the transferee Branch immediately. A
confidential report on the means, standing and respectability of the account holder,
as stated in paragraph 78.3 above may be sent to the transferee Branch along with a
copy of the forwarding letter and the draft drawing advice. It should NOT be handed
over to the customer in any case.

75.6. At the specified Branch to which the account is transferred, the identity of the
account holder should be established before he is allowed to operate the account
transferred from another Branch. There should be no difficulty to do so as the Branch
which transferred the account would have already furnished the specimen signature of
the account holder.

If, however, the request is received at the Branch where the account is to be
transferred, the application-cum-letter of request to transfer the account, the pass
book, a fresh account opening form/card, etc., and a cheque or withdrawal form duly
signed by the account holder in blank in favor of the Bank and crossed should be
forwarded by the transferee Branch to the transferor Branch. Whenever a blank
withdrawal form or cheque duly signed by the account holder is given to the transferee
Branch, it should be CROSSED and the name of the Bank –entered as PAYEE (in a
cheque) and, the withdrawal form/cheque along with the application to transfer the
account, the pass book, account opening form/card, etc., should be sent by
Registered Post. Branches should also obtain the customer's instructions on the
reverse of the cheque/withdrawal form, in addition to the letter of request to transfer
the account, in the following manner:

"Please close my account No. ……………………………. with you and transfer the
entire balance together with the interest to my account with your ……………..Branch."

On receipt of these, the transferor Branch should follow the procedure detailed in
paragraph 78 above and transfer the account. The transferee Branch should obtain
and destroy the unused cheque forms, if any, and advise the transferor Branch of the
numbers of the cheque forms destroyed to enable that Branch to make appropriate
remarks in the account and Cheque Book Delivery Register.

377
Infrequently Operated Current/Savings Bank Accounts

76. A current/Savings Bank account which has not been operated upon by the
account holder for more than two year and which has not been transferred to Sundry
Deposit Account-Unclaimed Balances/Savings Bank Dormant Accounts Ledger or
Register is to be considered as "infrequently operated" or inoperative account*. Due
care should be taken while allowing withdrawal in accounts which have remained
inoperative for a reasonably long time - say over six months. A remark
"INOPERATIVE ACCOUNT" should be made in the account so as to draw the
attention of the counter staff.(* Inoperative Accounts – Criteria for classification:
A savings as well as current account should be treated as inoperative / dormant if
there are no transactions in the account for a period over two years. For the purpose
of classifying an account as inoperative, both the types of transactions, i.e. debit as
well as credit transactions induced at the instance of customers as well as third
party should be considered. RBI has clarified that interest on term deposits credited
to the account of the customer should be treated as customer induced transaction
since it is according to the mandate of the customer. In such cases, ,the account
should be treated as an operative account as long as the interest on term deposit
account is credited to the Savings Bank account. The Savings Bank account can be
treated as inoperative account only after two years from the date of the last credit
entry of interest on term deposit.) Credit balance in inoperative account for more than
10 years should be transferred to the Depositor Education and Awareness Fund
Scheme, 2014. The depositor at any point of time can get his account activated by
submitting his KYC documents

77. As a precautionary measure, in such infrequently operated accounts the first

withdrawal should be authorized by the Branch Manager at smaller Branches and by
the Deputy Manager/Deputy Chief Manager at large Branches. For this purpose, the
following practice should be followed:

(a) A suitable remark should be made in the concerned account to the effect that
the withdrawal in the account should be referred to the Manager/Deputy Manager/
Deputy Chief Manager as the case may be. The Branch Manager/Deputy Manager/
Deputy Chief Manager should ensure that the first withdrawal in such an account is
so authorized.

(b) The
Manager/Deputy Manager/ Deputy Chief Manager should also ensure that the
remark (to refer withdrawal to the Manager/Deputy Manager/ Deputy Chief Manager)
is cancelled under initials and dated after operation in the account has been resumed.

Unsatisfactory Accounts

78.1. Unsatisfactory accounts are those in which cheques are drawn without
providing/arranging for adequate funds to cover them and the cheques have to be
returned unpaid frequently. It is very unsatisfactory for a banker to have to return
378
cheques for financial reasons. Apart from reflection on the status of the account holder,
it also affects the image of the Bank.

78.2. An account holder maintaining a very small average balance in the account but
operating the account extensively by drawing cheques of small amounts or an account
holder drawing cheques against unclear effects and expecting the Bank to pay his
cheques can also be called unsatisfactory account. (Also refer paragraph 7 of the
Chapter on Current Accounts).

78.3. Strict supervision by the Manager over accounts where cheques are returned for
want of funds is necessary. (Procedure to deal with such account holders is given in
paragraph 27). Branches should deal in a suitable manner with account holders who
issue cheques which they have good reason to believe will not be paid.

Black List of Undesirable Customers/ None face to face Customers

79.1. It is advisable for Branches to keep a special file entitled "Black List of
Undesirable Customers" in which special circulars from Head Office giving a list of
undesirable customers should be carefully filed as and when received. This file may be
kept either by the Manager/Deputy Manager/ Deputy Chief Manager as the case may
be. In addition, a separate record may be kept in which the names of those on the black
list should be recorded alphabetically for easy reference. Before opening accounts, it is
advisable to refer to the black list to ensure that the prospective account holder's names
are not included therein. This file and the record should be treated as "Confidential" and
carefully maintained.

79.2. If a Branch has unhappy experience with any of its customers, Branch Manager
should advise Head Office the undesirability of having dealing with such a customer
giving full particulars of the customer concerned and conduct of his account so that
Head Office may consider issuing circulars to all Branches to keep them warned.

Note: The term "savings bank accounts" referred to in this Chapter includes both
the categories of saving account, viz. savings accounts WITH CHEQUE BOOK
facility and savings account WITHOUT CHEQUE BOOK facility. Instructions in
this Chapter are equally applicable to both these categories of savings account
unless the context indicates to the contrary.

79.3.With the advent of technology and paradigm shift in the financial market, we have
widened scope of our salary account, various salary schemes were designed keeping
in mind the banking and financial needs of targeted groups. These new products were
marketed to the targeted group/customer class in a vigorous manner so as substantial
business is mobilized in a sustained manner.

79.4 The saving bank accounts were designed to be more scheme code (say SB 121,
SB 161, SB 162, SB163, SB 164,SB165, SB 166, SB167,...) with Special Charge Code
to allow diiferential product & services offering PENSION, 0201, 0202, 0203, 0204,
SENIOR, SBMAH, GURU etc....) with Average Quarterly Balance concept, instead of
379
minimum balance concept. These newly launched saving accounts carry various
freebies, group insurance protections, to make lucrative and competitive in the market.
Hence the correct data feeding and data capture should be followed to avoid future
frauds, risk and sustained customer service.

79.5. Current accounts being core domain for CASA and Net Interest Income source,
the competitive forces are continuously luring the current account customer with better
product offerings and additional features. We are following Current Account Tierization
with relationship based pricing model i.e. customer is encouraged to avail maximum
benefit in the form of discount and waiver on service charges, if the depositor are willing
to maintain Average Quarterly Balances. These current accounts are facilitated with
seamless communication from Head Office All new Current accounts will be opened
with free code 10 for benefits and modalities of Silver/Gold/Gold Plus/ Diamond/
Diamond Plus/ Platinum/Platinum Plus solely based on AQB.

79.6. This Tierization of Current account follows the basic tenets that, we cannot afford
to offer the same benefits to the customer who are maintaining relatively lesser AQB,
as there is cost attached to every service which is offered by the Bank.

79.7. According to RBI-2015-16 DBR Leg BC 25./09.07.005/2015-16 dated

02.07.2015 Bank to ensure branches do not open Current Accounts of entities which
enjoys credit facilities (Fund Based + Non Fund Based) from the banking system
without specifically obtaining NOC from the lending Bank. It is further clarified that, bank
may open current account of prospective customer in case no response is received
from the existing banker after a minimum waiting period of a fortnight.

APPENDIX I
(Paragraph 25.5)

Specimen of Reply to Account Holder - Guarantee of Third-Party

Endorsements on Cheques

Ref. No. Date .........

Dear Sir/Madam,

With reference to your letter of . we have, as requested by you, guaranteed/confirmed

the endorsement of .................. on the cheque/draft No on for Rs ______We
look to you for reimbursement in full of any loss caused to us by reason of our so acting
upon such your request.

Yours faithfully, Manager

380
 Appendix II
(Paragraph 26.3)

Specimen of Advice of Payment Against Uncleared Effects as a

Special case-Return of Cheques

Ref. No. Date ................

Dear Sir/Madam,

Re : Your cheque No ........ for

Rs............favouring .........

We beg to advise that we have today honoured, as a special case, the

abovementioned cheque although drawn against an uncleared local bank
clearing cheque. Your account has been debited with Rs in this
connection.

A cheque of another local clearing bank paid in for credit of an account before
the due time, viz p.m. on week days, IS NOT AVAILABLE FOR DRAWING
AGAINST UNTIL THE NEXT WORKING DAY, provided you have ascertained
that it has not been returned. A local clearing cheque paid in on a Saturday
cannot be drawn against till the SECOND working day thereafter.*

(* This is applicable at places where there is no clearing on Saturdays.)

Please note that we shall not, in future pay cheque drawn against uncleared
effects and we should be obliged if you would kindly refrain from drawing cheques
in this manner.

If, on a particular occasion, you are desirous of drawing against a local clearing
cheque, please see as early as possible on that day the Manager/Deputy
Manager/ Deputy Chief Manager who will endeavour to get the cheque sent for
special collection.

Yours faithfully, Manager

381
 Appendix III
(Paragraph 27.1(b))

Specimen of Final Notice - Return of Cheques

Ref. No. Date .........

Dear Sir/Madam,

We beg to advise that your cheque No .................for Rs ........... has today been
presented for payment, but as your account is only Rs ............. at credit, we have
returned the cheque with the answer…………….

We shall be glad if you will, in future, not issue cheques overdrawing your account.
Please note that your account will be subject to a half-yearly service charge.

Kindly also note that the next cheque returned for want of funds will entail the
IMMEDIATE closing of your account WITHOUT ANY FURTHER REFERENCE TO
YOU.

Yours faithfully,

Branch Manager

382
 Appendix IV
(Paragraph 27.1(c))
Specimen of Registered Acknowledgement Due Notice - Return of
Cheques
Ref. No. Date ......
Registered Acknowledgement Due

Dear Sir/Madam,

Re : Cheque No ......dated...............for Rs

The abovementioned cheque was presented for payment today but as your
account was only Rs in credit, we have returned the cheque with the remark
"Refer to Drawer". Your Account has been debited with Rs being the Bank's
service charges in this connection.

As you do not conduct the account to our satisfaction and as you issue cheques in
excess of your balance, we regret we have to request you to close your account
by the and return to us all the unused cheque forms in your possession.

If you do not close your account by the specified time, we shall be obliged to close
your account and issue a payslip for the final balance.

Yours faithfully,

Branch Manager

383
 Appendix V
(Paragraph 50.2)
Specimen of Mandate Letter

To Date .....

Bank of India,
Branch,

Dear Sir,

Re: Current/Saving Bank Account No………………………….

In the name (s) of …………………………………………………

I/We have given my/our authority to Mr./Mrs./Miss……………………………………to draw

and sign cheques on my/our Current/Saving Bank Account with you whether the same is in
credit or otherwise: and to endorse cheques, drafts, bills of exchange, hundies, dividend
warrants and interest coupons payable to me/us and to accept bills of exchange or hundies
drawn upon me/us and I/we hereby acknowledge and hold myself/ourselves liable thereon
in the same way as if signed by myself/ourselves.

You may treat this authority as continuing until I / we give you notice to the contrary in writing.

Yours faithfully,

Mr./Mrs/Miss …………………. ……………………

Will sing as …………………… ..………………….

WITNESS ……………………..

………………………………..

(Signature and address)

384
 Appendix VI
(Paragraph 79 (ii))
Specimen of Account Transfer Letter

BANK OF INDIA
______Branch

To: Date:

The Manager,
………………….Branch,

Dear Sir,

At the request of our account holder/s, Mr./Mrs./Miss./Messers _________ , we have

to-day closed his/her/their CD/SB Account No. ______ with us and enclose:

A Demand Draft No. _______ dated ______for Rs.drawn on you, representing the entire
i)
balance in the aforesaid account.

ii) A
fresh account opening form with the signature/s appearing thereon duly verified
by us.

iii) The pass book of the closed account duly up-dated.

2. Kindly open a CD/SB account in his/her/their name with you.

3. We have applied interest in the Savings Bank A/c No.______upto the preceding day of
A/c closure.

4. The aforesaid Savings Bank A/c was introduced/approved/not introduced.

5. A
copy of this letter along with the advice of drawing no._____dated_____are sent to
you separately by post.

6. Wehave delivered the original of this letter and Demand Draft as stated above to
Mr./Mrs./Miss./Messers………………………………………….. against his/her/their
acknowledgement.

Yours faithfully,

Manager
Encl: i) Demand Draft
ii)Account Opening Form
iii) Pass book

385
 CHAPTER 6

Revamped Savings Bank Account

A.Revamped Savings Bank Account

1.1 Revamped Savings Bank accounts is the modified savings bank accounts based on
tierisation where customers who affords to keep sizeable balance in the account on
quarterly average basis is eligible for certain concessions in charges and certain
additional facilities as enumerated below :

Introduction of Accounts

2. As applicable to Savings Bank Account para 2 in Chapter 4.

Types of Accounts

3. As applicable to Savings Bank Account para 3 in chapter 4. This scheme is applicable

to all persons/organizations who can open a SB account.

Opening of Accounts

4. Application to open should be made on Savings Bank Account Opening Form. The card
should be completed by the account holder in all respects. Other stipulations, formalities
and operational instructions pertaining to SB account is applicable mutatis-mutandis to
revamped SB account.

Major Features Offered upon Maintenance of Average Quarterly Balance

i. Upgraded Savings Accounts are embedded with Free Group Personal Accident
Insurance Cover as high as up to Rs.150 lakh
ii. Air Accidental Insurance Cover as high as up to Rs.100 lakh
iii. International Debit Cum ATM card with global access/ acceptance
iv. Higher Cash Withdrawal Limit up to Rs.1.00 lakh on ATM Cards*
v. Free Locker Facility for Gold, Diamond & Platinum SB A/C holder (Locker Type
“A” to “B” Only) for the first year.
vi. Concessional Rate of Interest on Retail Loan for Select Categories of Savings
bank accounts.
vii. Waiver of Processing Charges on Retail Loans
viii. Unlimited Free ATM Transactions at BOI ATMs
ix. One Month Overdraft against salary / Pension
x. Instant Personal Loan up to 6 Months Net Salary for salary/Pension account
holders.
xi. Free Issuance of Credit Cards

386
 xii. No Daily Minimum Balance Stipulation
xiii. Unlimited Cheque Leaves for Select Categories of SB Customers
5.2 The revamped Savings Accounts are simplified & upgraded with various features
& concessions. Bank is absorbing the cost of extending substantial coverage of accidental
insurance and also sacrificing revenue on various concessions. Now the Savings
Accounts
are scheme code driven and the special charge codes are withdrawn keeping the process
simple while opening of accounts. The features, benefits & concessions are now linked
to Scheme Code and the same are enabled based on scheme code of the Savings
Account Scheme/ Variant. Therefore, branches/ frontline staff need to choose relevant
Savings Account Scheme Code considering the eligibility, preferences of the customers
& profession of the customers. The concessions & benefits are linked to the accounts
based on Average Quarterly Balance (AQB) which encourages customers to maintain
higher balances on average basis so as to avail higher concessions and benefits.

5.3 The revamp & enrichment in features are being done for the existing Savings Bank
customers who will also be privileged to avail premium features, benefits & concessions.
The higher benefits and higher concessions to the existing Savings Customers are
considered to give an edge to our branches to peruse them for keeping higher balances
in Savings Account.

5.4. The revamped Savings Accounts are broadly classified in non-BSBDA, resident,
staff, and institutional Savings Accounts which are assigned specific scheme code
for linking / attaching attributes, features, benefits & concessions.

Summary of Changes
6.1 In order to rationalize the number of Schemes so as to bring down the number of
Savings Scheme to a reasonable acceptable level, following scheme codes are now
merged with corresponding scheme code of similar product class.
i. Scheme Code SB 162 (erstwhile Jai Jawan Salary A/C – Non Commissioned) is
now being merged with Scheme Code SB 161 Jai Jawan Salary Account.
Therefore, Jai Jawan Salary Account – SB 161 is now covering entire range of
Defence Salary accounts viz. Army, Navy, Air Force, Coast Gaurds, Para Military
Forces etc and also Police Personel & Para Military Forces.

Note: Now onward, the accounts are based on scheme codes. The features,
benefits & concessions are linked to Scheme Codes and Special Charge code is
withdrawn.
ii. Scheme Code SB 164 (erstwhile Ratnakar Bachat Salary Account) now merged
with Scheme Code SB 165 (Salary Accounts - Private Employees)

iii. Scheme Code SB 166 (erstwhile Senior Citizen SB Accounts) now discontinued
and merged with Scheme Code SB 101
iv. Scheme Code SB 167 (erstwhile Mahila Savings Account) & SB 166 (erstwhile
Senior Citizen SB Account) now merged with Scheme Code SB 101 (All non-staff,
non-minor, resident citizens).
6.2. The accounts under above scheme codes viz. SB 162, SB 164, SB 166 & SB 167
will continue in the system (Finacle) with revised scheme codes Code SB 161, SB 165 &
387
SB 101 respectively with revised / enhanced features/ concessions as per the scheme
norms. The scheme codes SB 162, SB 164, SB 166 & SB 167 stands withdrawn &
discontinued by the Bank and will no longer be available for on-boarding new customers
in these Scheme Code.
6.3. In order to make the concessions, features & benefits rational, the same has been
linked in proportion to the Average Quarterly Balance (AQB) maintained by the
customers. In order to have clear identification based on AQB, following tierised
categories have been enabled in the system (Finacle) for which system will calculate the
AQB based on the average balance maintained by the Savings account holder except
staff and institutional accounts.
Table
Sr. Name of Tier Minimum Range of AQB
No Qualifying AQB
Normal / Below Rs Below Rs.10,000/-
1
Regular 10,000/-
2 Classic Rs 10,000/- Rs.10,000/- & above but less than Rs.1.00 lakh
Rs 1 Rs.1.00 lakh & above but less than Rs.5.00
3 Gold
Lakh lakh
Rs. 5 Rs.5.00 lakh & above but less than Rs.10.00
4 Diamond
Lakh lakh
Rs 10 Rs.10.00 lakh & above
5 Platinum
Lakh

The very first AQB shall be calculated for the existing accounts for the period July, August &
September, 23 and the cycle for calculating the same will continue taking three months of the
subsequent quarter together. The new account which are opened in between the quarter, the very
first AQB shall be calculated on the residual period of the quarter in which the account has been
opened.

6.4 Please note that the features, benefits & concessions are linked to the Scheme
Code therefore while opening of Savings Account of customers, staff & customer should
be aware of the fact that customers fulfils the eligibility & norms for opening Savings
Account in a desired/ particular scheme code. In case of joint accounts, features,
benefits, concessions & other attached facilities shall be strictly as per the Scheme
Code and shall be extended to the first account holder only. Therefore, kindly make
sure that at the time of opening the account, correct Scheme Code is entered for the
relevant category of the customer he/ she belongs to as mentioned above.
Service Charges
7.1 The specific features, benefits & concessions are linked to the Scheme Code and the
same are made available/ embedded to the Savings Accounts of various categories /
variants wherein other services charges/ penal charges would be applicable to Savings
Accounts as per the prevailing Services Charges Circular.
8. Branches need to take care of the following points:
i. Dormant account holders are excluded from getting any benefits of tierisation.
ii. Salary/Pension accounts where salary/pension is not credited for 6 consecutive
months will be treated as regular Savings Bank Accounts and the enhanced
Insurance cover and other benefits would not be made available to them.

388
 iii. Minor Accounts which are opened in Pratham Savings Accounts under
Scheme Code SB – 116 will have to be converted to SB-101 or any other suitable
scheme as per the eligibility after completing the age of 18 years. Branches to
conduct Re-KYC/ update KYC of the account holder/s. Upon request of the
account holder and looking into the eligibility norms of the Savings Account
variants, branch may migrate/ switch the existing account into the preferred
category after notifying the Average Quarterly Balance (AQB) criteria, service
charges/ penal charges attached to the variant. All minor account holders need
to be notified suitably at least 3 months in advance regarding completing the KYC/
Re-KYC so as to enjoy uninterrupted operations of the Savings Account.
iv. As the special charge code is withdrawn, the proper occupation code is to be
fed into the Customer Master (CUMM) for the identification of customers.
v. Branches need to ensure that proper constitution code is chosen as per the
eligibility criteria of the scheme and are duly fed into the system at the time of
opening of account:

Scheme Scheme
Code Description Eligible Constitution Code
Only major accounts with
Savings Account constitution codes 41,42,47,48
SB101 General and 52.
Eligible entities having constitution
Savings Account codes other than
SB102 Institutional 41,42,43,44,47,48 and 52
Staff Salary Savings 43,44 (Active staff as well as
SB111 Account active pensioner)
Pratham Savings Minor Accounts with constitution
SB116 Account codes 41,42,47,48
Pensioners Savings
SB121 Account No Change
Rakshak Salary
SB161 Savings Account 41,42,47,48
Government Salary
SB163 Savings Account 41,42,47,48
Private Salary Savings
SB165 Account 41,42,47,48

Salary/Pension Account Modalities

9.1 Branches/ ZO / frontline staff should importantly note to take duly filled letters from
employers & employees at the time of opening the account or at the time of extending the
easy advance as an overdraft/instant Personal Loan as per the enclosed format annexed
with the circular.

389
 i. Annexure – A: Format of Letter of undertaking to be obtained from the
employees/pensioners at the time of account opening.
ii. Annexure – B: Format of undertaking to be obtained from the employee at the
time extending Easy Advance as Overdraft.
iii. Annexure – C: Format of undertaking to be obtained from the employee for
extending Instant Personal Loan.
iv. Annexure - D: Format of undertaking to be obtained from the employer at the time
of extending Easy Advance as Overdraft/Instant Personal Loan.
v. Annexure – E: Format of undertaking to be obtained from the customer at the time
of account opening if he/she wants to avail the benefits of the advanced features
of the premium categories i.e Gold/ Diamond/ Platinum.
Operational Guidelines:
10.1 Following operational guidelines and important instructions are to be kept in mind
while opening/ maintenance of Savings Accounts:
i. Eligibility norms of the Savings Accounts in a particular scheme code which is
proposed to be opened for a customer should be checked and ascertained that
prospective customer desirous of opening Savings Accounts fulfil the eligibility
criteria of the Savings Accounts – Scheme Code.
ii. All existing Savings Accounts are now onward classified/ categorised on the basis
of Scheme Code and special charge code is withdrawn. Therefore, care should be
taken to open the Savings Account in the correct scheme code after verifying the
eligibility norms so as to provide the benefits & concessions to the customers.
iii. All existing & new Savings Accounts are subject to qualify the prevailing KYC/
CKYC/Re-KYC as per the prevailing RBI guidelines which are in force. Guidelines/
policy issued by the bank vide “Policy on Know Your Customer (KYC) Norms/ Anti-
Money Laundering (AML)/ Combating of Financing of Terrorism (CFT)” to be
implemented & followed meticulously for maintaining & opening of new Savings
Account.
iv. Branch Head is made authorized to manually tag the new account for higher end
tierisation viz. Gold, Diamond or Platinum looking into the profile & assurance from
the customer to maintain higher AQB. By doing so, customer will become eligible
to avail higher benefits & concessions immediately upon opening of new account.
Branches are advised to obtain an undertaking that prescribed AQB shall be
maintained by the customer in the current quarter. If the requisite/ stipulated AQB
is not maintained, the account will get downgraded in the next quarter. Branches
will not be permitted / allowed to tag the account to their/ customer’s preference
during the later stage except at the time of new account opening.

Note: This provisions have been made in the system and only branch head will be
permitted to approve the tagging of account. If the account could not qualify for the
tagged category, the system will re-categorise/ re-tierise the account as Normal,
Classic, Gold etc as the case may be as per AQB. Similarly, if the new account is
tagged manually as a lower category and qualify for higher category as per AQB,
the system will tierise the account as per eligible higher category based on AQB
maintained.

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11. Savings Bank Account – General (Scheme Code –SB 101)

Eligibility: All Resident Individuals (single or jointly), Two or more individuals Joint
Accounts, Hindu Undivided Families (HUF).

Minimum Balance Requirement: There is no stipulation of maintaining Daily Minimum

Balance for all Non-BSBD Savings Bank Accounts. The criteria for recovering penal
charges are based on stipulated Average Quarterly Balance (AQB) instead daily
minimum balance stipulation. Therefore, customer enjoys freedom of utilizing his full
amount on any particular day without any penal charges on account of minimum
balance. The criteria for maintenance of stipulated AQB and penal charges as per
Branch Circular on service charge issued from time to time.

Note: Savings Bank Account opened/ maintained in Scheme Code SB -101 (Savings
Bank Account – General) will attract penal charges as per Service Charge Circular issued
by the Bank from time to time.

Any tierised account viz. Classic, Gold, Diamond & Platinum if do not meet the above
AQB stipulation, the penal charges in the subsequent month / quarter, shall be levied as
per the prevailing Service Charge Circular.

SB101 (Savings Account General)

Features Diamon Plati
Normal Classic Gold
d num
Daily
Minimum Nil
Balance
Average Rs
Rs 5
Quarterly Rs 500 Rs. 10,000 Rs 1 Lakh 10
Balance Lakh
Lakh
Waiver of
ATM/ Debit
Card
Issuance
charges* Visa
(Only one Rupay Rupay Rupay
card and
Visa Classic Sign
NCMC Platinum Select
first ature
issuance is
being
considered
for waiver)
*At the time of issuance/replacement/renewal and AMC the system will apply the charges as per
the prevailing Categorisation of the accounts.
The Rupay NCMC will be there in Free choice with all variants.
Rupay Sangini Debit Card- Sangini Debit Card is an exclusively designed ATM cum Debit Card for
Women. This card will only be issued to all women account holders.

391
Waiver of
ATM/ Debit
Card AMC
(Subject to
Rs.50,000/ Rs. 2
qualify Rs.50,000/- Rs.1 Lakh Rs.5
Average - Lakh
Lakh
Yearly
Balance)

Free 50 Unli
First 25 25 Leaves 25 Leaves
Cheque Leaves mite
Leaves leaves p.a. per Qtr
per Qtr d
Waiver of
Charges applicable as per bank’s 50% waiver
RTGS/NEF
latest service charges
T Charges
Free Charges applicable as per bank’s
DD/PO latest service charges
50% waiver
Credit
Card
issuance 100% waiver for all categories
Charges
waiver
SMS Alerts Chargeable Free
WhatsApp
Alerts Chargeable Free
The Group Personal Accident Insurance Cover is inbuilt benefit to the SB A/C holders
and its coverage amount is linked to Scheme Type which is further enhanced based
on maintenance of AQB. (Details of Group Personal Accident Insurance Cover is
Group advised vide HO BC 117/158 dated 08.09.2023.)
Personal (Group Personal Accident Insurance cover will prevail as per Bank’s issued
Accident guidelines from time to time.)
Insurance
cover
Rs.1,
Rs. Rs.25,00,000 Rs.50,00,
Rs.10,00,000/- 00,00
1,00,000/- /- 000/-
,000/-
Passbook First issuance Free Issuance Free
Free
Transaction at
BOI ATM per 10
month
Free
Transaction at
other bank
ATM per 5*
month
*Including financial and non-financial transactions
Note: In case of ATMs located in six metro locations, viz. Bengluru, Chennai, Hydrabad, Kolkata, Mumbai and New
Delhi, bank shall offer their savings bank account holders 3 free transactions (including financial and non-financial
transactions) in a month at any other bank’s ATM.
Rules in this regard will prevail as per RBI/Bank’s issued guidelines from time to time.

392
Concession in
Processing
Charges in
Not Available 50% 75% 100%
Retail Loans

Concession in
ROI in Retail 5 bps 10 bps 25bps
Loans Not Available

In case of any other concession already offered to Retail Loan

customers viz. festive offers, special concessions to women
Note:
beneficiaries etc, the concessions proposed to Savings Account
holders vide this Branch Circular is automatically withdrawn.
Locker Rent
Concession* NA 10% 50% 100%
Salary/Pensio
n Advance NA
Instant
Personal Loan NA

*Subject to availability of the lockers. The proposed concessions will be available only for
the locker type A and B for the first year.

12. Savings Bank Account – Institutional (Scheme Code –SB 102)

Eligibility: Savings Bank Accounts – Institutional under Scheme Code –SB 102 may be opened
for following categories:

i. Associations, Clubs, Societies, etc., Trusts, Institutions / Agencies specifically permitted by

RBI.
ii. Following Primary Co-operative Credit Society which is being financed by the bank.
a. Khadi and Village Industries Board
b. Agriculture Produce Market Committee
c. Societies registered under Societies Registration Act, 1860 or any other corresponding Law
in force in the state or Union Territory.
d. Companies Governed by the Companies Act 1956 which have been licensed by the Central
Government under section 25 of the Act, or under the corresponding provisions in the Indian
Companies Act 1913 and permitted, not to add to their names the word "Limited or the
words "Private Limited"
e. Institutions other than those mentioned in para 2 and whose entire income is exempt from
payment of income tax under Income Tax Act, 1961.
f. Government departments/bodies/agencies in respect of grants/subsidies released for
implementation of various programs/schemes sponsored by Central Government/State
Governments subject to production of an authorization from the respective Central/State
Government departments to open savings bank account.

393
 g. Development of women and children in rural areas (DWCRA). h) Self-help Groups (SHGs)
registered or unregistered, which are engaged in promoting savings habits among their
members.
h. Farmers' Clubs - Vikas Volunteer Vahini.

Prohibitions for opening Savings Accounts: Savings Bank account shall not be opened
in the name of the following categories of institutions/ entities:

i. Any trading or business concern, whether such concern is proprietorship, partnership,

company or association
ii. Government departments/bodies depending upon budgetary allocations for performance of
their functions.
iii. Municipal Corporations/Committees
iv. Panchayat Samities
v. State Housing Boards
vi. Industrial Development Authorities
vii. State Electricity Boards
viii. Water / Sewerage / Drainage Boards
ix. State Text Book publishing corporations / societies / Metropolitan Development Authorities
x. State / District level housing Co-operative Societies.
xi. Other banks including Regional Rural Banks, Co-operative Banks and land Development
Banks.
xii. Political parties These Institutions / Organizations are specifically excluded from opening
SB Accounts with Banks and earn interest thereon and hence branches are prohibited from
opening such Accounts.

Note: Any other institution permitted by Reserve Bank of India from time to time, can be allowed
to open Savings Bank Accounts.

Please carefully note that “acceptance of Interest free deposits in Savings Bank is
prohibited irrespective of caste, creed or religion of the depositor”

Occupations Codes & Customer Constitution Code: Branch / staff opening the account need
to select occupation code & customer constitution code from the dropdown menu.

Minimum Balance Requirement: Nil for Institutional Savings Account under Scheme Code
SB102

SB-102 (Savings Account Institutional)

Features
All Category
Minimum Balance Nil
AQB Nil
Waiver of ATM/ Debit Card Issuance
Not Available in Government Accounts
charges
394
 Waiver of ATM/ Debit Card AMC
Not Available in Government Accounts
Transaction in POS/PG
Free Cheque Leaves Unlimited
Waiver of RTGS/NEFT Charges 100% waiver
Free DD/PO 100% waiver
Credit Card issuance Charges waiver Not Available in Government Accounts
Credit Card AMC Waiver (Min Transaction
Not Available in Government Accounts
Amt)
SMS Alerts Free
WhatsApp Alerts Free
Group Personal Accident Insurance cover
Not Applicable
& other covers
Passbook
Free Transaction at BOI ATM per month
Free Transaction at other bank ATM per
month
Concession in Processing Charges in
Retail Loans
Not Available in Government Accounts
Concession in ROI in Retail Loans

Locker Rent Concession

Salary/Pension Advance
Instant Personal Loan

13. Pratham Savings Account - Scheme Code –SB 116

Eligibility: Only individual minor below the age of 18 years. Account holder upon attaining the age
of majority i.e. 18 years of age, the account will become SB General (SB-101) or any other suitable
scheme as per the eligibility and will be tierised as per AQB stipulation viz. Classic, Gold, Diamond
& Platinum. The benefits & concessions thereafter shall be based on tierised category which is
maintained by the account holder.

Minimum Balance Requirement: Nil for Pratham Savings Account.

Upon attaining the age of majority i.e. 18 years of age, the account will become SB General which
shall be subject to penal charges for non-maintenance of stipulated Average Quarterly Balance
(AQB) vide Annexure I. The features, benefits & concessions offered with Pratham Savings
Account (Scheme Code – SB 116) are as under:

SB116 (Pratham Savings Account)

Features
Normal Classic Gold Diamond Platinum
Minimum Balance Nil
Average Quarterly Rs 10
Nil Rs 10,000 Rs 1 Lakh Rs 5 Lakh
Balance Lakh

395
Waiver of ATM/
Debit Card Issuance
charges*(Only one
card and first Rupay NCMC Rupay Select
issuance is being
considered for
waiver)
*At the time of issuance/replacement/renewal and AMC the system will apply the charges
as per the prevailing Categorisation of the accounts.
Rupay NCMC will be there in Free choice with all variants
Waiver of ATM/
Debit Card AMC
(Subject to qualify 50,000/- 75,000/-
Average Yearly
Balance)
Free Cheque
First 25 leaves 25 Leaves per Qtr
Leaves
Waiver of
Charges applicable as per bank’s latest
RTGS/NEFT 100% waiver
service charges
Charges
Charges applicable as per bank’s latest
Free DD/PO 100% waiver
service charges
Credit Card
issuance Charges Not Eligible
waiver
SMS Alerts Chargeable Free
What’s App Alerts Chargeable Free
The Group Personal Accident Insurance Cover is inbuilt benefit to the SB
A/C holders and its coverage amount is linked to Scheme Type which is
further enhanced based on maintenance of AQB. (Details of Group
Personal Accident Insurance Cover is advised vide HO BC 117/158 dated
Group Personal
08.09.2023.)
Accident Insurance
(Group Personal Accident Insurance cover will prevail as per Bank’s
Cover
issued guidelines from time to time.)

Rs.50,000/ Rs.10,50,000 Rs.50,50,00 Rs.1,00,50,

Rs.25,50,000/-
- /- 0/- 000/-
Passbook First issuance Free Issuance Free
Free Transaction at 10
BOI ATM per month
Free Transaction at
other bank ATM per 5*
month
* Including financial and non-financial transactions
Note: In case of ATMs located in six metro locations, viz. Bengluru, Chennai, Hydrabad,
Kolkata, Mumbai and New Delhi, bank shall offer their savings bank account holders 3 free
transactions (including financial and non-financial transactions) in a month at any other
bank’s ATM. Rules in this regard will prevail as per RBI/Bank’s issued guidelines from time
to time.
Concession in
100% Concession in processing charges of Education Loans only
Processing
396
 Charges in Retail
Loans
Locker Rent
Services Not Applicable
Concession
Salary/Pension
NA
Advance
Instant Personal
NA
Loan

14. Pensioners Savings Account - Scheme Code – SB 121

Eligibility: The individuals who are drawing regular pension from Bank of India irrespective of age
are eligible for Pension Savings Account.

Minimum Balance Requirement: Nil for Pensioners Savings A/Cs under Scheme Code - SB
121.

SB121 (Pensioners Savings Account)

Features
Normal Classic Gold Diamond Platinum
Minimum Balance Nil
Average
Nil Rs 10,000 Rs 1 Lakh Rs 5 Lakh Rs 10 Lakh
Quarterly Balance
Waiver of ATM/
Debit Card
Issuance
charges*(Only Rupay Rupay
Visa Classic Rupay Select Visa Signature
one card and first NCMC Platium
issuance is being
considered for
waiver))
*At the time of issuance/replacement/renewal and AMC the system will apply the charges
as per the prevailing Categorisation of the accounts.
Rupay NCMC will be there in Free choice with all variants
Waiver of ATM/
Debit Card AMC
(Subject to 50,000/- 75,000/- Rs.1 Lakh Rs.2 Lakh Rs.5 Lakh
qualify Average
Yearly Balance)
Free Cheque First 25 25 Leaves 25 Leaves 50 Leaves
Unlimited
Leaves leaves p.a. per Qtr per Qtr
Waiver of Charges applicable as
RTGS/NEFT per bank’s latest service 100% waiver
Charges charges
Charges applicable as
Free DD/PO per bank’s latest service 100% waiver
charges
Credit Card
issuance Charges
100% waiver for all categories
waiver
SMS Alerts Chargeabl Free
397
 e
Chargeabl
WhatsApp Alerts Free
e
The Group Personal Accident Insurance Cover is inbuilt benefit to the SB
A/C holders and its coverage amount is linked to Scheme Type which is
further enhanced based on maintenance of AQB. (Details of Group
Personal Accident Insurance Cover is advised vide HO BC 117/158 dated
Group Personal
08.09.2023.)
Accident
(Group Personal Accident Insurance cover will prevail as per Bank’s
Insurance cover
issued guidelines from time to time.)

Rs.5,00,0 Rs.15,00,00 Rs.30,00,000 Rs.55,00,000 Rs.1,05,00,00

00/- 0/- /- /- 0/-
Passbook Issuance Free
Free Transaction
at BOI ATM per 10
month
Free Transaction
at other bank 5*
ATM per month
* Including financial and non-financial transactions
Note: In case of ATMs located in six metro locations, viz. Bengluru, Chennai, Hydrabad,
Kolkata, Mumbai and New Delhi, bank shall offer their savings bank account holders 3 free
transactions (including financial and non-financial transactions) in a month at any other
bank’s ATM.
Rules in this regard will prevail as per RBI/Bank’s issued guidelines from time to time.
Concession in
Processing
50% 100%
Charges in Retail
Loans
Concession in
ROI in retail Loans Not Available 5 bps 10 bps 25bps
(s.t. minm rates)
In case of any other concession already offered to Retail Loan
customers viz. festive offers, special concessions to women
Note
beneficiaries etc, the concessions proposed to Savings Account
holders vide this Branch Circular is automatically withdrawn.
Charges applicable as
Locker Rent
per bank’s latest service 25% 50% 100%
Concession*
charges
Salary/Pension
Equal to 1 month net Pension
Advance
Equal to 6 months net Pension (All other terms and conditions as arriving
Instant Personal
Net Take Home (NTH), ROI will be as per bank’s prevailing guidelines for
Loan
Personal loan)

15. Rakshak Salary Savings Account - Scheme Code – SB 161

Eligibility: Following categories of employees drawing monthly salary are covered in the Rakshak
Salary Account – Scheme Code – SB 161:

398
 i. All permanent employees of Defence Forces i.e. Indian Army, Indian Air Force, Indian Navy,
Paramilitary Forces and Coast Guards. Agniveers are also eligible under this scheme. Ex-
servicemen getting pension are also eligible & covered in this Scheme.

ii. All existing permanent employees of the Central & State Police, Civil Police, home guards,
Traffic Police and Reserve Police of all States, Police Forces of The Union Territories
(Under The Control of The Central Government), Railway Protection Force (RPF) (under
the Ministry of Railways, Central Government) and Government Railway Police (GRP) –
(part of State Police Force).

Minimum Balance Requirement: Nil for Rakshak Savings A/Cs under Scheme Code - SB 161.

Features SB161 (Rakshak Salary Savings Account)

Normal Classic Gold Diamond Platinum
Minimum
Nil
Balance
Average
Quarterly Nil Rs 10,000 Rs 1 Lakh Rs 5 Lakh Rs 10 Lakh
Balance
Waiver of ATM/
Debit Card
Issuance
charges*(Only
Rupay Rupay
one card and Visa Classic Visa Signature
Platinum Select
first issuance
is being
considered for
waiver)
Waiver of ATM/
Debit Card
AMC (Subject
75,000/- Rs.1 Lakh Rs.2 Lakh Rs.5 Lakh
to qualify
Average Yearly
Balance)
Free Cheque
25 Leaves per Qtr Unlimited
Leaves
Waiver of 100% waiver
RTGS/NEFT
Charges
Free DD/PO 100% waiver
Credit Card
issuance
100% waiver
Charges
waiver
Chargeabl
SMS Alerts Free
e

399
 WhatsApp Chargeabl
Free
Alerts e
The Group Personal Accident Insurance Cover is inbuilt benefit to the
SB A/C holders and its coverage amount is linked to Scheme Type
which is further enhanced based on maintenance of AQB. (Details of
Group Personal Accident Insurance Cover is advised vide HO BC
117/158 dated 08.09.2023.)
(Group Personal Accident Insurance cover will prevail as per
Bank’s issued guidelines from time to time.)
1.Group 1.Group 1.Group 1.Group
Personal Personal Personal Personal
Accidental Accidental Accidental Accidental
Death Death Death Death
Insurance Insurance Insurance Insurance
1.Group
Cover of Cover of Cover of Cover of
Personal
upto upto upto upto
Accidental
Rs.50,00, Rs.60,00, Rs.75,00,00 Rs.100,00,0
Death
000/- 000/- 0/- 00/-
Insurance
2.Perman 2.Perman 2.Permanent 2.Permanent
Cover of upto
ent Total ent Total Total Total
Rs.150,00,000
Group Disability Disability Disability Disability
/-
Personal Cover of Cover of Cover of Cover of
2.Permanent
Accident upto upto upto upto
Total Disability
Rs.50,00, Rs.50,00, Rs.50,00,00 Rs.50,00,00
Insurance Cover of upto
000/- 000/- 0/- 0/-
cover Rs.50,00,000/-
3. 3. 3. 3.
3. Permanent
Permanen Permanen Permanent Permanent
Partial
t Partial t Partial Partial Partial
Disability
Disability Disability Disability Disability
Cover of upto
Cover of Cover of Cover of Cover of
Rs.25,00,000/-
upto upto upto upto
4.Air
Rs.25,00, Rs.25,00, Rs.25,00,00 Rs.25,00,00
Accidental
000/- 000/- 0/- 0/-
Insurance of
4.Air 4.Air 4.Air 4.Air
upto
Accidental Accidental Accidental Accidental
Rs.1,00,00,00
Insurance Insurance Insurance of Insurance of
0/-
of upto of upto upto upto
5.Educational
Rs.1,00,0 Rs.1,00,0 Rs.1,00,00,0 Rs.1,00,00,0
benefit of upto
0,000/- 0,000/- 00/- 00/-
Rs.2,00,000/-
5.Educatio 5.Educatio 5.Education 5.Education
nal benefit nal benefit al benefit of al benefit of
of upto of upto upto upto
Rs.2,00,0 Rs.2,00,0 Rs.2,00,000/ Rs.2,00,000/
00/- 00/- - -
Passbook Issuance Free
Free
Transaction at
10
BOI ATM per
month
Free
5*
Transaction at

400
 other bank
ATM per month
Concession in
Processing
Nil 50% 100%
Charges in
Retail Loans
Concession in
ROI in retail Not Available 5 bps 10 bps 25bps
Loans
Charges
applicable
as per
Locker Rent
bank’s 50% 100%
Concession*
latest
service
charges
Salary/Pension
Equal to 1 month net
Advance
Equal to 6 months net Salary (All other terms and conditions as arriving
Instant
Net Take Home (NTH), ROI will be as per bank’s prevailing guidelines
Personal Loan
for Personal loan)

16. Govt. Salary Savings Account – Govt Employees - Scheme Code – SB 163

Eligibility: Following categories of employees drawing monthly salary are covered in the Salary
Account – Govt. Employees - Scheme Code – SB 163:

i. Central Govt., State Govt., Govt of India Undertaking & PSU Employees drawing regular
salary. Contractual staff such as also eligible subject to approval from the employer and
direct salary credit without any vendor.

ii. Govt. Employees of University, College & School or any other such institution/ training
colleges (both teaching & non-teaching staff are covered)

iii. Pensioners also eligible for this scheme if they maintain pension account with us in
SB163.

Minimum Balance Requirement: Nil for Govt. Salary Account – Govt Employees - Scheme Code
– SB 163.

SB163 (Government Salary Savings Account)

Features
Normal Classic Gold Diamond Platinum
Minimum Balance Nil
Average Quarterly
Nil Rs 10,000 Rs 1 Lakh Rs 5 Lakh Rs 10 Lakh
Balance

401
Waiver of ATM/ Debit
Card Issuance
charges*(Only one Rupay Visa
Visa Classic Rupay Select
card and first Select Signature
issuance is being
considered for waiver)
*At the time of issuance/replacement/renewal and AMC the system will apply the charges
as per the prevailing Categorisation of the accounts.
Rupay NCMC will be there in Free choice with all variants
Waiver of ATM/ Debit
Card AMC (Subject to
75,000/- Rs.1 Lakh Rs.2 Lakh Rs.5 Lakh
qualify Average
Yearly Balance)
Free Cheque Leaves 25 Leaves per quarter Unlimited
Waiver of RTGS/NEFT
100% waiver
Charges
100% waiver
Free DD/PO
Credit Card issuance
100% waiver
Charges waiver
Charge
SMS Alerts Free
able
Charge
Whats App Alerts Free
able
The Group Personal Accident Insurance Cover is inbuilt benefit to the
SB A/C holders and its coverage amount is linked to Scheme Type
which is further enhanced based on maintenance of AQB. (Details of
Group Personal Accident Insurance Cover is advised vide HO BC
117/158 dated 08.09.2023.)
(Group Personal Accident Insurance cover will prevail as per
Bank’s issued guidelines from time to time.)

1.Group 1.Group 1.Group 1.Group

1.Group Personal Personal Personal Personal
Persona Accidental Accidental Accidental Accidental
l Death Death Death Death
Acciden Insurance Insurance Insurance Insurance
Group Personal
tal Cover of Cover of upto Cover of Cover of
Accident Insurance
Death upto Rs.75,00,000/- upto upto
Cover
Insuran Rs.60,00,00 2.Permanent Rs.100,00,0 Rs.150,00,
ce 0/- Total Disability 00/- 000/-
Cover 2.Permanent Cover of upto 2.Permanent 2.Perman
of upto Total Rs.50,00,000/- Total ent Total
Rs.50,0 Disability 3. Permanent Disability Disability
0,000/- Cover of Partial Cover of Cover of
2.Perma upto Disability Cover upto upto
nent Rs.50,00,00 of upto Rs.50,00,00 Rs.50,00,0
Total 0/- Rs.25,00,000/- 0/- 00/-
Disabilit 3. 4.Air Accidental 3. 3.
y Cover Permanent Insurance of Permanent Permanen
of upto Partial upto Partial t Partial
Rs.50,0 Disability Rs.1,00,00,000 Disability Disability
402
 0,000/- Cover of /- Cover of Cover of
3. upto 5.Educational upto upto
Perman Rs.25,00,00 benefit of upto Rs.25,00,00 Rs.25,00,0
ent 0/- Rs.2,00,000/- 0/- 00/-
Partial 4.Air 4.Air 4.Air
Disabilit Accidental Accidental Accidental
y Cover Insurance of Insurance of Insurance
of upto upto upto of upto
Rs.25,0 Rs.1,00,00,0 Rs.1,00,00,0 Rs.1,00,00
0,000/- 00/- 00/- ,000/-
4.Air 5.Educationa 5.Education 5.Educatio
Acciden l benefit of al benefit of nal benefit
tal upto upto of upto
Insuran Rs.2,00,000/ Rs.2,00,000/ Rs.2,00,00
ce of - - 0/-
upto
Rs.1,00,
00,000/-
5.Educa
tional
benefit
of upto
Rs.2,00,
000/-

Passbook Issuance Free

Free Transaction at
10
BOI ATM per month
Free Transaction at
other bank ATM per 5*
month
* Including financial and non-financial transactions
Note: In case of ATMs located in six metro locations, viz. Bengluru, Chennai, Hydrabad,
Kolkata, Mumbai and New Delhi, bank shall offer their savings bank account holders 3 free
transactions (including financial and non-financial transactions) in a month at any other
bank’s ATM.
Rules in this regard will prevail as per RBI/Bank’s issued guidelines from time to time.
Concession in
Processing Charges Nil 50% 100%
in Retail Loans
Concession in ROI in
retail Loans (s.t. minm Not Available 5 bps 10 bps 25bps
rates)
In case of any other concession already offered to Retail Loan
customers viz. festive offers, special concessions to women
Note
beneficiaries etc, the concessions proposed to Savings Account
holders vide this Branch Circular is automatically withdrawn.
Locker Rent
NA 50% 100%
Concession*
Salary/Pension
Equal to 1 month net Salary
Advance

403
 Equal to 6 months net Salary (All other terms and conditions as
Instant Personal Loan arriving Net Take Home (NTH), ROI will be as per bank’s prevailing
guidelines for Personal loan)

17. Private Salary Savings Account – Private Employees - Scheme Code – SB 165

Eligibility: Following categories of employees drawing monthly salary are covered in the Salary
Account – Private Employees - Scheme Code – SB 165:

i. All Private Sector Employees / Corporates Employees drawing regular salary

ii. Private Sector Employees of University, College & School or any other such institution/
training colleges (both teaching & non-teaching staff are covered)

(All the existing Private sector and Gurukul Accounts to be transferred to SB 165)

Minimum Balance Requirement: Nil for Corporate Salary Account – Private Employees -
Scheme Code – SB 165

SB165 (Private Salary Savings Account)

Features
Normal Classic Gold Diamond Platinum
Minimum Nil
Balance
Average
Quarterly Nil Rs 10,000 Rs 1 Lakh Rs 5 Lakh Rs 10 Lakh
Balance
Waiver of
ATM/ Debit
Card
Issuance
charges*
Rupay Visa
(Only one Visa Classic Rupay Select
Platinum Signature
card and first
issuance is
being
considered
for waiver)
*At the time of issuance/replacement/renewal and AMC the system will apply the
charges as per the prevailing Categorisation of the accounts.
Rupay NCMC will be there in Free choice with all variants
Waiver of
ATM/ Debit
Card AMC
(Subject to
75,000/- Rs.1 Lakh Rs.2 Lakh Rs.5 Lakh
qualify
Average
Yearly
Balance)
Free Cheque
25 Leaves per quarter Unlimited
Leaves

404
Waiver of
RTGS/NEFT 50% waiver 100% waiver
Charges
Free DD/PO 50% waiver 100% waiver
Credit Card
issuance
100% waiver
Charges
waiver
SMS Alerts Chargeable Free
WhatsApp
Chargeable Free
Alerts
The Group Personal Accident Insurance Cover is inbuilt benefit to the SB A/C
holders and its coverage amount is linked to Scheme Type which is further
enhanced based on maintenance of AQB. (Details of GP is advised vide HO
BC 117/158 dated 08.09.2023.)
(Group Personal Accident Insurance cover will prevail as per Bank’s
issued guidelines from time to time.)

1.Group 1.Group
1.Group 1.Group 1.Group
Personal Personal
Group Personal Personal Personal
Accidental Accidental
Personal Accidental Accidental Accidental
Death Death
Accident Death Death Death
Insurance Insurance
Insurance Insurance Insurance Insurance
Cover of upto Cover of
Cover Cover of upto Cover of upto Cover of upto
Rs.30,00,000 upto
Rs.40,00,000 Rs.55,00,000 Rs.80,00,000
/- Rs.1,30,00,0
/- /- /-
2. Air 00/-
2. Air 2. Air 2. Air
Accidental 2. Air
Accidental Accidental Accidental
Insurance of Accidental
Insurance of Insurance of Insurance of
upto Insurance of
upto upto upto
Rs.50,00,000 upto
Rs.50,00,000 Rs.50,00,000 Rs.50,00,000
/- Rs.50,00,000
/- /- /-
/-

Passbook Issuance Free

Free
Transaction 10
at BOI ATM
per month
Free
Transaction
at other bank 5*
ATM per
month
* Including financial and non-financial transactions
Note: In case of ATMs located in six metro locations, viz. Bengluru, Chennai, Hydrabad,
Kolkata, Mumbai and New Delhi, bank shall offer their savings bank account holders 3
free transactions (including financial and non-financial transactions) in a month at any
other bank’s ATM.
Rules in this regard will prevail as per RBI/Bank’s issued guidelines from time to time.
Concession Nil 50% 100%
405
 in Processing
Charges in
Retail Loans
Concession
in ROI in Not Available 5 bps 10 bps 25bps
Retail Loans
In case of any other concession already offered to Retail Loan customers
viz. festive offers, special concessions to women beneficiaries etc, the
Note
concessions proposed to Savings Account holders vide this Branch
Circular is automatically withdrawn.
Locker Rent
NA 50% 100%
Concession*
Salary/Pensio
Equal to 1 month net Salary
n Advance
Instant
Equal to 6 months net Salary (All other terms and conditions as NTH, ROI will
Personal
be as per bank’s prevailing guidelines for Personal loan)
Loan

18. Staff Salary Account – Bank of India Staff - Scheme Code – SB 111

Eligibility: All permanent / contractual staff of Bank of India to whom monthly salary is paid from
Bank of India are covered in the Staff Salary Account – BOI Staff - Scheme Code – SB 111.

Minimum Balance Requirement: Nil for Staff Salary Account – BOI Staff - Scheme Code – SB
111.
SB111 (Staff)
Features
All Category
Minimum
Nil
Balance
AQB Nil
Waiver of
ATM/ Debit
Card Rupay Platinum
Issuance
charges
Waiver of
ATM/ Debit
Card AMC 75,000/-
Transaction
in POS/PG
Free Cheque
Free
Leaves
Waiver of
RTGS/NEFT 100% Waiver
Charges
Free DD/PO 100% Waiver
Credit Card
issuance
100% Waiver
Charges
waiver
406
Credit Card
AMC Waiver
(Min 75,000/-
Transaction
Amt)
SMS Alerts Free
Whats App
Free
Alerts
Available at par with Gold Salary Account
1.Group 1.Group 1.Group 1.Group 1.Group
Personal Personal Personal Personal Personal
Accidental Accidental Accidental Accidental Accidental
Death Death Death Death Death
Insurance Insurance Insurance Insurance Insurance
Cover of Cover of Cover of Cover of Cover of
Rs.50,00,000/ Rs.60,00,000/ Rs.75,00,000/ Rs.1,00,00,00 Rs.1,50,00,00
- - - 0/- 0/-
2.Permanent 2.Permanent 2.Permanent 2.Permanent 2.Permanent
Total Total Total Total Total
Disability Disability Disability Disability Disability
Cover of Cover of Cover of Cover of Cover of
Rs.50,00,000/ Rs.50,00,000/ Rs.50,00,000/ Rs.50,00,000/ Rs.50,00,000/
GPA & other - - - - -
covers 3. Permanent 3. Permanent 3. Permanent 3. Permanent 3. Permanent
Partial Partial Partial Partial Partial
Disability Disability Disability Disability Disability
(50%) Cover (50%) Cover (50%) Cover (50%) Cover (50%) Cover
of of of of of
Rs.25,00,000/ Rs.25,00,000/ Rs.25,00,000/ Rs.25,00,000/ Rs.25,00,000/
- - - - -
4.Air 4.Air 4.Air 4.Air 4.Air
Accidental Accidental Accidental Accidental Accidental
Insurance of Insurance of Insurance of Insurance of Insurance of
Rs.1,00,00,00 Rs.1,00,00,00 Rs.1,00,00,00 Rs.1,00,00,00 Rs.1,00,00,00
0/- 0/- 0/- 0/- 0/-
5.Educational 5.Educational 5.Educational 5.Educational 5.Educational
benefit of benefit of benefit of benefit of benefit of
Rs.2,00,000/- Rs.2,00,000/- Rs.2,00,000/- Rs.2,00,000/- Rs.2,00,000/-

Passbook issuance Free

Free
Transaction
Unlimited
at BOI ATM
per month
Free
Transaction
at other Unlimited
bank ATM
per month
Concession
in As per Bank Guidelines
Processing
407
Charges in
Retail Loans
Concession
in ROI in
Retail Loans
Locker Rent
Concession
Salary/Pensi
on Advance
Instant
Personal
Loan

19. STAR NARI SHAKTI SAVINGS ACCOUNT

FEATURES - STAR NARI SHAKTI SAVINGS ACCOUNT UNDER NEW SCHEME

Parameter CODE 192

Target Group Women in the age group of 18 years and above with independent source of regular
income
Eligibility Singly or in joint names. The first account holder should belong to the target group.
Staff is also eligible to open account in this scheme
Tiered structure Accounts categorized to 5 different tiers based on the AQB maintained
available
Normal Classic Gold Diamond Platinum
Minimum Nil
Balance (Nari Shakti Savings Account is Zero Balance Account & concessions & benefits are
linked to the account based on AQB maintained in previous completed quarter)
(No Penalty to be levied for Non maintenance of AQB even it falls below the
stipulated level under tiered category)
AQB Criteria AQB - Below Rs Rs 10,000/- Rs 1 lakh & Rs 5 lakhs & Rs 10 lakhs &
10,000/- to less than above to less above to less above
the Account will be Rs.1.00 lakh than Rs.5.00 than
treated as Normal Lakh Rs.10.00
SB A/C and Lakh
Charges will be
levied as per the
prevailing Service
Charge Circular
except Minimum
Balance Charges
as the A/C is a Zero
Balance A/C.
Charges for No Penalty for Non Maintaining Daily Minimum Balance it being a Zero Balance
Non Account.
Maintaining
Minimum Even the AQB proposed to be maintained for availing higher benefits will also
Balance/AQB not attract any penalty if the AQB falls in the account at any points of time. In
the given situation, entitlements of availing benefits will remain linked to the
AQB maintained in the previous completed quarter.
Example: Concessions & benefits on opted/ availed services in the month of
January shall be worked out on the basis of the AQB maintained during period
of Oct, Nov & Dec.

408
Charges for No Charges for excess debit entries in Savings Bank account except cash
excess debit withdrawals which will be governed by the existing rules/ prevailing service charge
entries in SB circular.
account. ATM /
INTERNET
transactions not
to be counted /
reckoned
Free Cheque First 25 leaves 25 leaves per 25 leaves per 50 leaves per Unlimited
Leaves annum quarter quarter
In addition to first 25 Free leaves
Waiver of Nil 10% waiver 50% waiver 100% waiver
Issuance of
DD/Pay slips
charges
Waiver of Chargeable As 10% waiver 50% waiver 100% waiver
RTGS/NEFT per Service
Charges Charge Circular
Eligible Debit Rupay Visa Classic/ Rupay Rupay Visa
cum ATM NCMC/Sangini Rupay Platinum/ Select/ Signature/
Card/Waiver of debit Card NCMC/Sangi Rupay Rupay Rupay
ATM/ Debit ni debit Card NCMC/Sangini NCMC/Sangi NCMC/Sangin
Card Issuance debit Card ni debit Card i debit Card
charges(only
one card and
first issuance is
being
considered for
waiver)
Credit Card
issuance 100% waiver
Charges waiver
SMS Alerts Free
WhatsApp Chargeable Free for accounts having AQB of Rs.10,000/- & above in
Alerts previous completed quarter.
GPA & other The Group Personal Accident Insurance Cover is inbuilt benefit to the SB A/C
covers holders and its coverage amount is linked to Scheme Type which is further enhanced
based on maintenance of AQB. (Details of GPA is advised vide HO BC 117/158
dated 08.09.2023.)

Rs.1,00,000/- Rs.10,00,000/- Rs.25,00,000/- Rs.50,00,000/- Rs.1,00,00,000/

-
Passbook Issuance Free(first time)
Free unlimited
Transaction at
BOI ATM per
month
Free As per the prevailing Service Charge Circular (presently BC:NO:117/54 dated
Transaction at 06.05.2023)
other bank ATM
per month
Concession in NIL 25% waiver 50% waiver 75% waiver 100% waiver
Processing
Charges in
Retail Loans*

409
 Concession in Not available 5 bps 10 bps 25 bps
ROI in retail
Loans
Note *In case of any other concession already offered to Retail Loan customers viz.
festive offers, special concessions to women beneficiaries etc, the
concessions proposed to Savings Account holders vide this Branch Circular is
automatically withdrawn.
Discount on Women are considered to be sensitive to their jewellery/ ornaments therefore
Locker Rental this discounted rental shall be a unique selling proposition which in turn will
give edge to the product to attract more potential customers.

N/A 25% 50% 100%

On the Annual Rent of Lockers of A & B category subject to availability of lockers.
(This facility will be provided for the first year only)
Demat Account N/A 50% 100%
Annual
Maintenance
charge
Personal Loan Personal Loan : For salaried/ working & self-employed with ITR : Refer to the Master
Facility Circular on Star personal Loan Circular for all details (Recent circular No:BC
No:117/08 dated 01.04.2023)

i. Eligibility: Salaried (permanent employees of central govt, state govt & corporates),
professionals and high net worth individuals, existing diamond and platinum
customers maintaining accounts for more than 6 months. (All other terms and
conditions as arriving Net Take Home (NTH), ROI will be as per bank’s prevailing
guidelines for Personal loan.)

ii. Concession of 0.50% pa is applicable in ROI for women beneficiary. Under no

circumstances the ROI should be below RBLR
*(In case of any other concession already offered by the HO-Retail, the concession in
ROI under this product will automatically be withdrawn)

Health and
Wellness In order to make the offerings more attractive, our existing Health Insurance
providers (Star Health, Care Health Insurance, Reliance General Insurance
and Bajaj Allianz) are offering dedicated Health and Wellness products/offers
at discounted rates which suites the demands of the tiered structure of our
Star Nari Shakti Account. (details under Annexure I)
Other Facilities  Free Internet Banking facility
& Incentives  Free Fund Transfer Through Internet Banking
 Free utility bills payment facility through E-pay
 Free Missed call alert facility

All other facilities/ concessions will also be made available in these accounts which
are otherwise available to Normal Savings Accounts.
Girl child For every New Nari Shakti Account opened, the bank will contribute Rs 10/- towards
welfare the banks CSR funds for socio economic welfare for uplifting/ supporting girl child.
20. Accounts for NRI customers

Savings NRE account (Scheme code ‘SB-131’)

This scheme is specially launched for all the NRI customers for opening of Savings
account. Account can be held jointly by a NRI/with a resident Indian (Former or Survivor
basis). A Resident account holder can operate the account only as a mandate/POA holder.
The Resident Indian must be a close relative of account holder. Savings NRE account can
410
be opened at all the branches.

Savings NRO account (Scheme code ‘SB-141’)

This account can be jointly held by a NRI or with a Resident Indian. This account can be
opened with Indian currency (INR) itself. Savings NRO account can be opened at all the
branches.

RFC Savings account (Scheme code ‘SB-151’)

A Resident Foreign Currency savings account can be opened by the NRIs who have
returned for permanent settlement after being resident outside India for not less than 1
year. These funds can be transferred to an NRE/FCNR account upon change of status to
NRI again. RFC savings account can be opened at designated branches. RFC account
can be maintained in to US dollar and Great Britain Pound (GBP).

RFC Savings
Features NRE Savings Account NRO Savings Account account for

Eligibility NRIs (individuals/entities of 1. Any person resident Outside India(other A Resident

returning NRIs Foreign
than a person resident in Nepal and Currency Savings
Bangladesh/Pakistan Bhutan). Account can be opened
by NRIs who have
2. Individuals/entitiesof Pakistan returned for permanent
Nationality/ownership require prior settlement after being
approval of RBI). Nationality/ownership, entities of
Bangladesh ownership and erstwhile resident outside India
Overseas Corporate Bodies require prior for a continuous period
approval of Reserve Bank of India. of not less than one
year. These funds can
be transferred to an
NRE/FCNR account
Joint Account Account can be held jointly by a NRI Account can be held jointly by a NRI upon change
Account can beof status
held
facility (persons of Indian nationality or origin) (persons of Indian nationality or origin) / to NRI again.
jointly by eligible
/ with a Resident Indian (Former or with a Resident Indian. Returning NRI with
Survivor basis). A Resident Indian can a Resident Indian
operate the account only as a Mandate (Former or Survivor
/ POA holder. The Resident Indian basis). The Resident
must be a close relative as defined in Indian must be a close
Section relative as defined in
Section 6 of the
6 of the Companies act,1956. Companies act, 1956.

Currency in Indian Rupees (INR) Indian Rupees (INR) US Dollar

which account (USD), Great
maintained Britain

Pound (GBP)
Repatriation Principal and interest are RBI allows repatriation only for i) current Funds are repatriable
income ii) up to USD one million per for bonafide purposes
fully repatriable financial year (April-March), for any
bonafide

Purpose after payment of

applicable taxes.

411
Mandate Holder An Indian resident can be An Indian resident can be N.A.

authorized to operate the authorized to operate the

account and provided with an ATM card account and provided with an ATM card for
for the account the account
Interest Rate as advised by
Rate Bank from time to time
as per stipulated
Taxation Interest earned is exempted from Tax Interest is taxable under Indian Income Tax Interest earned is
guidelines.
in India Act exempted from Tax in
India provided Resident
but

Not Ordinarily
Cheque Free 50 Cheque leaves per annum Free 50 Cheque leaves per annum Resident
Free 50 Cheque leaves
Book per(RNOR)
annum
status is held as per the
Fund Transfer Free fund transfer within Free fund transfer within bank Free
Incomefund transfer
Tax Act
within bank (Self
bank (Self A/c or Third Party) (Self A/c or Third Party)
Free collection of NEFT/RTGS Free A/c or
Free collection of NEFT/RTGS through Net banking Third Party)
NEFT/RTGS
Free collection
Ancillary Services  Free Internet
Free banking
NEFT/RTGS through  Free Internet banking  Free
of Internet
NEFT/RTGS
banking
Net banking
Free NEFT/RTGS
 Missed Call alert facility for  Missed Call alert facility for obtaining  Missed
through
Call
account balance alert facility
Net
Obtaining account balance for obtaining
banking
account
 Online Income Tax return filing facility balance
 Online Income Tax return
 Free utility bills payment  Online Income Tax
Filing facility return filing facility
Facility through E-pay
Change in  Free
NRE accounts should
utility bills be designated as NRO accounts may be designated as
payment Authorised dealers
should
Free convert
utility bills
residential status resident accounts or the funds held in resident accounts on the return of the the
from Non-resident these accounts may be transferred to  ATM cum
account International
holder to India forDebit
any purpose payment facility
FCNR(B) deposits on
to resi-dent Facility through E-pay
the RFC accounts, at the option of the indicating his intention to stay in India for maturity into resident
account holder, immediately upon the an 7 uncertain period. ru-pee
Through deposit
E-pay
 ATMofcum
re-turn theInternational
account holder to India
Debit Card for accounts or RFC
taking up employment or on change in Card (EMV chip based) account (if the
(EMV chip based)
the residential status.  Likewise, when a resident Indian depositor
ATM cum is eligible to
becomes a person resident outside India, International Debit Card
open RFC account), at
his existing resident ac-count should be (EMV
the chip)of the
option
designated as NRO account. account holder

412
 Annexure A

LETTER OF UNDERTAKING
To be submitted by the Employee

Present Residential Address Permanent Address:

______________________________ ________________________________
______________________________ ________________________________
______________________________ _________________________________
Office Address:
________________________________
________________________________
________________________________
Date:
The Assistant General Manager / :
Chief Manager / Senior Branch Manager /
Branch Manager
Bank of India,
_____________ Branch

Dear Sir / Madam,

My Savings Bank Account No. ____________________ with
you
Personnel No. _____Salary Code No._____________
I, ___________________________S/o/W/o/D/o employed with _____ (Employer) am fully
aware that my Employer has agreed to disburse the salary through my captioned account. I am fully
aware and further agree that the said services and any complimentary facilities if provided by the Bank
shall stand terminated/withdrawn automatically upon non-credit of salary/pension for 6 continuous
months or my resignation/termination from the present employer. Bank shall also be within its right to
withdraw, modify any of the complimentary facilities provided to me or make any or all of them a paid
service and in such case I will be treated only like any other normal customer of the Bank and I shall
be liable to pay the normal service charges, costs, interest, commission etc. as applicable to the
general customers of the Bank.

Further I also state that the Bank will not be liable or held accountable for any
consequential or related action arising from the act of refund of amount to the
Employer from my account, made under instructions of the Employer with or without
assigning any reason for the same by the employer. The Bank will also be within its
right to freeze all transactions in my salary account till such time the matter is
conclusively resolved between the employer and myself.
I further agree and undertake that I shall be bound by the Letter of undertaking (if any, between my
employer and bank) and any modifications / amendments to the same entered into with Bank of India
and the Employer shall not be questioned by me. I am also fully aware that Bank shall be required to
disburse my salary provided the same is pre-funded / paid by the employer. I shall intimate to the bank
any change in my address. I shall not transfer my Salary Account in case of my transfer or for
whatsoever reason, without taking prior clearance from the bank.

413
I am Aware that the Insurance Cover is Subject to settlement of Claim by the
Insurance Company without any Liability to the Bank. The rights and liabilities of the
insured shall be with the Insurance Company and that Insurance Contracts or any of
its terms shall not be binding on the Bank and the Bank takes no responsibility to
either the Insurance Company or the Insured. Bank holds the right to withdraw the
facility at its discretion in any subsequent year.

I am aware about the facilities being provided and my obligation for timely repayment of principal and
interest on loans/overdraft provided to me under ________________Salary account subject to
execution of Bank’s prescribed documents. Bank may recover the outstanding dues including interest
thereon from me or my successors/nominees /assigns or from my dues payable to me by my employer.
This authority is irrevocable and may be used for the recovery of Bank’s dues.

Signature
Full Name:
Designation:
Contact Number:

414
 Annexure B

APPLICATION FOR EASY OVERDRAFT FACILITY

Place:
Date:

The Assistant General Manager/

The Chief Manager/the Senior Branch Manager
/Branch Manager, Bank of India,
_______________________Branch
Dear Sir,

My SB Account No __________________________________________.

Request for sanction of easy overdraft under the scheme

With reference to above, I have to state that I have been maintaining the
captioned SB account with your Branch since______________ wherein my salary is
being credited every month. I wish to apply for Easy overdraft of Rs.______________
(up to one month’s net salary not exceeding Rs. 1 Lakh).

My date of joining is __________________and date of superannuation is

___________________.

2 I agree to abide by all the terms and conditions prescribed by the Bank and
agree to execute all the necessary documents for the said overdraft as and when
required.

3 I undertake to repay the said overdraft created in my savings bank account

with interest at as applicable/advised to me from time to time which is ___% over
RBLR, presently ___% p.a. or as may be reset by BOI from time to time. I am aware
that this overdraft is only for 30 days and in case this is not repaid within 30 days then
overdue interest @ __% p.a. will be recovered by the bank additionally on entire
balance outstanding in my overdraft account. I also undertake to repay the overdraft
with interest on ceasing to be employee of _____________ immediately.

I authorise you to Debit my account number (alternate A/c if any)

_______________________ and credit my overdrawn SB account by the amount
outstanding along with up to date interest thereon
Thanking you,
Yours faithfully,

( )
Name:
_____________________
Employee Code and salary code if any

415
 Designation:
________________
Address:
___________________
___________________________

___________________________ Contact No

416
 Annexure C
APPLICATION FOR INSTANT PERSONAL LOAN:
Place:
Date:
The Assistant General Manager/
The Chief Manager/the Senior Branch Manager
/Branch Manager, Bank of India,
_______________________Branch
Bank of India

Dear Sir,

My SB Account No __________________________________________.

Request for sanction of Instant Personal Loan under the scheme

With reference to above, I have to state that I have been maintaining the
captioned SB account with your Branch since______________ wherein my salary is
being credited every month. I wish to apply for Instant Personal
Loan.______________ (up to six month’s net salary not exceeding Rs. 5 Lakhs).

My date of joining is __________________and date of superannuation is

___________________.

2 I agree to abide by all the terms and conditions prescribed by the Bank and
agree to execute all the necessary documents for the said overdraft as and when
required.

3 I undertake to repay the said demand loan in _______ Equated Monthly

installments of Rs._________ with interest at monthly rests as applicable/advised to
me from time to time which is ___% over RBLR, presently____ % p.a. or as may be
reset by BOI from time to time. I am aware that this loan is only for ____ months (max
36 months) and will be recovered from my Salary Account number
___________________ on ____ day of every month. In case this is not repaid on
due date then overdue interest @ __% p.a. will be recovered by the bank additionally
on entire balance outstanding in my loan account. I authorize you to recover the
amount of EMI every month from my salary account number___________________
maintained with ___________Branch. I also undertake to pay the loan with interest
outstanding immediately on ceasing to be employee of _____________.

Thanking you,
Yours faithfully,

( )
Name:
Account Number:

417
 Annexure D
LETTER OF UNDERTAKING
(To be obtained from the Employer)

The Assistant General Manager /Chief Manager

Senior Branch Manager / Branch Manager
Bank of India,
________________________ Branch

Dear Sir / Madam,

Re: Request for Overdraft / Personal Loan facility to our employee
Mr. / Mrs. / Ms________________________________ Employee ID No.________
is maintaining a Salary A/c No. ____________________with your Branch.
On the request of our employee Mr. / Mrs. / Ms______ _______________________
Bank is considering above mentioned loan/overdraft facility to him / her. In this regard
we note as under:-
1. We shall not change his / her above mentioned Salary account without the prior
consent of your Branch.
2. In case of non-payment of amount in the overdrawn account or loan account, on
your demand the outstanding amount will be paid by us directly to the Bank by
deducting the amount from his / her salary and / or other amounts due to the
employee from us.
3. We note to obtain a “No Dues Certificate” from you, in the event he / she requests
for shifting his / her Salary Account to another Bank / Branch, or submits a
notice of resignation, or retires from our organization or has his / her employment
terminated by us and note to settle the terminal benefits of the employee, if any,
and other amounts due to him / her from us through the salary account
maintained with your Branch.

Executed on this the __________ day of __________________ at

__________.

Yours Faithfully,

Name :
_______________________
____________________ Designation : __________________
Authorised Signature

Seal

418
 Annexure E
LETTER OF UNDERTAKING
(To be obtained from the Customer)

The Assistant General Manager /Chief Manager

Senior Branch Manager / Branch Manager
Bank of India,
________________________ Branch

Dear Sir / Madam,

Re: Request for the tierisation of the savings bank account in
_______category to avail the benefits of the features provided by you in
certain category

I Mr. / Mrs. / Ms_______________________s/o d/o w/o _____________want/wants

to open a new savings bank account with your Branch.
I undertake that:
1. I will maintain the stipulated AQB for the __________ category.
2. If any point of time I will fail to maintain the stipulated AQB the bank will be
authorise to degrade my account and deduct the applicable charges from my
savings account.

Executed on this the __________ day of __________________ at

__________.

Yours Faithfully,

Name: _______________________
Mobile: ______________________

Signature:_____________________

419
 Letter to be obtained from the Employer on the Organization’s letter head

The Assistant General Manager /Chief Manager

Senior Branch Manager / Branch Manager
Bank of India,

Branch

Ref : Request for opening Salary A/c of our Employee with you Bank.
Dear Sir / Madam,

Please refer to our request for opening salary a/c of our employees with your Bank.
We agree to the following Terms & Condition of Bank of India (Bank) for opening
Salary Account of our employees:-

1. The term ‘Employee’ or ‘Personnel’ shall not include outsourced employees

or casual/temporary employees appointed for a period of less than ___
months.

2. The Employees whose salaries are to be disbursed shall open their salary
savings account with Branches of the Bank following the Bank’s procedure
for the same interalia mentioning their Staff Personnel number and salary
code etc. allotted by the Employer in the Account opening form at the time
of opening their salary account with the Bank.

3. The Employer will provide either a local cheque in Bank’s favour .... days in
advance along with a list of employees with full details for the credit of their
accounts along with soft copies or will maintain a Current Account with the
Bank with such balance as may be stipulated by the Bank from time to time.

4. The Employer shall pre-fund the salary to be paid to the Employees in the
current account of the Employer providing the details of the amounts to be
credited to each employee in hard copy as well as in soft copies. The format
of soft copy will be decided with the consent of both the parties so that data
may be loaded in the system for urgent posting of accounts.

5. The Employees who are drawing an amount of Rs. 5,000/- / Rs.10,000/-or

above per month shall be eligible to open salary account with the Bank to
which their monthly salary shall be arranged to be credited by the Employer.
It will be discretion of the Bank to allow to any other employee to open
account if his salary is less than Rs. 5,000/- / Rs.10,000/- per month.

6. As far as possible the Employer shall open a current account (said Account)
with the Bank at the designated Branch (Designated Branch) wherein the
Employer shall maintain sufficient funds. The Employer shall transfer the

420
 required funds electronically to the said Account or issue a consolidated
cheque payable at towards total salary of its Personnel having their
accounts in the Bank in advance together with salary details of each
Personnel on electronic media in such format as may be advised by the Bank
along with a copy of the same in physical form duly signed and sealed by the
Employer to the Designated Branch.

7. The amounts towards payment of the salary along with the bank account/
salary details of each of the Employees are to be provided by the Employer
to the Designated Branch at least seven days before the due date of actual
credit of salary.

8. In the event of any Employee ceasing to be in the service of the Employer for
any reason, the same shall be intimated by the Employer to the Bank
immediately and not later than 7 days of the Employee ceasing to be in the
service of the Employer.

9. The Bank undertakes to credit into account of the Personnel who are
holding their salary accounts in the various branches of the Bank connected
to CBS their salary within days of the Employer providing adequate
funds/salary along with the bank account/ salary details of each of the
Employees. At the sole discretion of the Bank, Bank may also consider
disbursement of any other amounts as may be payable by the Employer to
an Employee at the request of the employer to Bank on such terms and
conditions that Bank may stipulate including payment of any service
charges by the Employer to the Bank.

10. Bank shall not under any circumstances be bound to accede to the request
of the Employer for recall of the salary erroneously disbursed to any
Employees at all. Such issues shall be settled by the Employer directly with
the Employees without involving the Bank in any manner. Bank also shall not
be liable or bound to refund any amount withdrawn by any personnel for which
they are not entitled to.

11. Bank may at its sole discretion provide certain complimentary facilities to the
Employees which may vary from time to time. Such complimentary facilities
provided may be modified or withdrawn or made a paid service by the Bank
without any prior notice to the Employer and/or the Employees.
Notwithstanding anything contained herein or in any other document, writings,
between the Parties herein or between the Bank and the Employer/Employee,
the services/complimentary facilities extended to the Employees shall cease
immediately upon termination of this arrangement or from the date of the
Employee ceasing to be in the service of the Employer, whichever is earlier.
From the said date they shall also be liable to pay all service charges,
commission, interest etc. as applicable to that of a normal customer of the
Bank.

421
 12. (a) This arrangement may be terminated with immediate effect by either party
giving notice of termination to the other Party (the ‘Defaulting Party’)

(i) if the Defaulting Party has committed a material breach of any term of
this arrangement and has failed to remedy such breach (if capable of
remedy) within thirty (30) days after notice from the other party to do so.

(ii) Ifthe Defaulting party repeatedly commits the same breach of any of
the terms of this arrangement then the arrangement may be terminated
without any further notice.

(iii) If
the Defaulting Party shall cease to carry on its business or
substantially the whole of its business:

(iv) If there is a material adverse change in any applicable law affecting

Bank generally.

12 (b) Either party shall also have the right to terminate this arrangement for any
other reason which need not be disclosed to the other by giving 60 days’
notice in writing to the other.

12 (c) In the event of any Govt., statutory, regulatory guidelines Bank shall be
entitled to terminate this arrangement forthwith.

13. Each notice, demand or other communication to be given or made hereunder

shall except as otherwise provided herein, be given or made in writing and may
be sent by one Party to the other Party by Registered Post, e-mail, facsimile
or hand to the address or numbers mentioned below or such other address
and numbers as one Party may inform the other in writing.

Executed on this ____________ day of _________ at .

Name & Address of Employer Signed on behalf of Employer

AUTHORISED SIGNATORY SIGNATURE, NAME AND SEAL

{Supported by proper Board resolution dated

( in case of company) }

422
LETTER OF UNDERTAKING

To be submitted by the Employee

Residential Address:

Office Address:

Date:

The Assistant General Manager / :

Chief Manager / Senior Branch Manager /

Branch Manager

Bank of India,

Branch

Dear Sir / Madam,

My Savings Bank Account No. _____ with you

Personnel No. Salary Code No. _______________________________

I, Shri / Smt ____________ S/o/W/o employed with _____ (Employer) is fully

aware that my Employer has agreed to disburse the salary through my captioned
account in accordance

with the terms of the letter of the undertaking datedexecuted by my Employer. I am

fully
aware and further agree that the said services and any complimentary facilities if
provided by the Bank shall stand terminated/withdrawn automatically upon
termination/expiry of the said letter of undertaking or upon my resignation / dismissal
/ desertion / retirement from the service of the Employer which ever happens earlier.
Bank shall also be within its right to withdraw, modify any of the complimentary
facilities provided to me or make any or all of them a paid service and in such case
I will be treated only like any other normal customers of the Bank and I shall be liable
to pay the normal service charges, costs, interest, commission etc. as applicable to
the general customers of the Bank.

Further I also state that the Bank will not be liable or held accountable for any
consequential or related action arising from the act of refund of amount to the
Employer from my account, made under instructions of the Employer with or without

423
assigning any reason for the same by the employer. The Bank will also be within its
right to freeze all transaction in my salary account till such time the matter is
conclusively resolved between the employer and myself.

I further agree and undertake that I shall be bound by the said Letter of undertaking
and any modifications / amendments to the same entered into with Bank of India and
the Employer shall not be questioned by me. I am also fully aware that Bank shall
be required to disburse my salary provided the same is pre-funded / paid by the
employer. I shall intimate to the bank any change in my address.

I am aware about the facilities being provided and my obligation for timely repayment
of principal and interest on loans/overdraft provided to me as various incidental
benefits under BOI Saral Salary A/c / BOI Salary Plus a/c. Bank may recover the
outstanding dues including interest due on me from me or my successors/nominees
/assigns or from my dues payable with my employer. This authority is irrevocable
and may be used for the recovery of Bank’s dues.

Signature

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 APPENDIX - 1
(Paragraph – I)

U.BOI Savings plus Account opening Form

FILL NAME(S) (IN BLOCK LETTERS) OCCUPAT

1. ION
2.
3.
ADDRESS (OF FIRST DEPOSITOR)

PARTICULARS OF NOMINES (S)

In the event of death of any of the joint depositors, prior to maturity of the deposit the
Bank will at the request of the Surviving depositor/s of all the surviving depositors, be at
liberty though not bound and at its absolute discretion to add/delete any name or to
repay the deposit before maturity, or to grant an advance against the security thereof,
on such terms as the Bank may in its absolute discretion decide and such repayment
before maturity shall constitute a valid discharge to the Bank.
BOI SAVING PLUS ACCOUNT

BANK OF INDIA

I/We request
standing you
in the to open
name/s of Savings Bank Account linked
to this BOI Saving Plus

I/We agree to be bound by the Bank’s rules and regulations governing such
accounts from time to time. The tenure for deposits would be for _____ days / 6
months (fillTO
PAYABLE up/delete as applicable) SIGNATURE/S (Specimen)

ME 1.
survivor Jointly to use or 2.
survivor
3.
SPECIAL INSTRUCTIONS

VERIFIED DATE ACCOUNT

NO.
AUTHORISED SIGNATURE

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V.Savings Bank Schemes

Scheme code Scheme Name

SB101 SAVINGS BANK GENERAL
SB102 SB-INSTITUTIONAL
SB103 SB WELCOME KIT SCHEME
SB104 STAR SARAL BACHAT ACCOUNT
SB105 LOW INCOME SB (KYC)
SB106 SPECIAL SAVINGS SCHEMES
SB111 SB STAFF
SB121 SB-PENSION
SB131 SB-NRE
SB141 SB-NRO
SB151 RFC- (RET INDIANS) SB
SB161 JAI JAWAN (COMMISSIONED)
SB162 JAI JAWAN (NON COMMISSI.)
SB163 BOI SALARY PLUS ACCOUNT
SB 163 (WITH SPECIAL
CHARGE CODE 'GURU) BOI STAR GURUKUL SB A/C
SB164 STAR RATNAKAR BACHAT SALARY
SB165 BOI SARAL SALARY SCHEME
SB166 BOI STAR SENIOR CITIZEN SB A/C
SB167 BOI STAR MAHILA SB A/C
SB181 FISB (SMART CARD)
SB182 FISB (SMART CARD - TCS)
SB183 FISB (SMART CARD - HCL)
SB 116 Star Yuva Acs

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W.Current Deposit Schemes

Scheme code Scheme Name

CD 201 CURRENT - GENERAL
CD 202 RFC (DOMESTIC)
CD 203 EEFC SCHEME
CD 204 EEFC FOR OTHER BRANCHES
CD 205 CURRENT - DEPOSITS NRO
CD 206 CURRENT - DEPOSIT NRE
CD 207 EDISCD
CD 208 PDSCD
CD 209 CURRENT - COLLECTION A/C
CD 210 CDEXTR
CD 211 CURRENT - INSTITUTIONAL
CD 212 VOSTRO ACU USD
CD 213 VOSTRO ACCOUNTS BANKS
CD 214 VOSTRO ACCOUNTS PEHS
CD 215 VOSTRO ACCOUNTS BRANCHES
CD 216 DIVIDEND WARRANTS PAYMENT
CD 217 DIVIDEND WARRANTS PAYMENT
CD 218 INTEREST WARRANT PAYMENTS
CD 219 CURRENT ACCOUNT IN FC
CD 220 LOW INCOME CD (KYC)
CD 221 DIAMOND DOLLAR ACCOUNTS
CD 222 PAYMENT OF TAX - OUR BANK
CD 249 CURRENT - NSE

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 CONSENT LETTER FOR CONVERTING BOI Savings Plus Account/

BOI Current Deposit Plus Account into Normal Account

Present Communication Address Permanent Address:

Date:

The Assistant General Manager /

Chief Manager / Senior Branch Manager /

Branch Manager

Bank of India,

Branch

Dear Sir / Madam,

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Conversion of my BOI Savings Plus Account/BOI Current Deposit Plus Account
into Normal Account

I/We refer to the notice regarding modifications in certain parameters of BOI

savings plus account/BOI current deposit plus account displayed on Bank’s website.

I request you to consider converting my existing BOI Savings plus Account/BOI

Current Deposit plus Account (No: _______________________ ) into normal Savings

Bank Account/Current Account. I am aware that after conversion of my BOI savings
plus account/BOI current deposit plus account to normal account, my account and the
FFDs shall not be linked and accordingly upon maturity of the FFD the same may be

renewed as a normal FD for -------- months/* ------ yrs /*the proceeds be credited to my

SB/current a/c..

Thanking you,

Signature

Full Name:

Contact Number:

Email Id:

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 CHAPTER 7 -FIXED AND SHORT DEPOSITS ACCOUNTS
1. Fixed and Short Deposits in this Chapter are referred to as “Term Deposits".

2. All officers dealing with the Term Deposit accounts must thoroughly acquaint
themselves with the Bank's Term Deposit Rules, study the directives issued by
the Reserve Bank of India regarding such deposits from time to time and keep
abreast of changes, amendments, etc. and strictly adhere to the instructions
contained therein.

3. Deposits which are repayable within 179 days are called Short Deposits; interest
thereon is calculated on the basis of 365/366 days in a year for the actual number
of days the Short Deposit remains with the Bank. Deposits which are repayable
after six months or more are called Fixed Deposits; interest thereon is calculated
on the basis of 365/366 days in a year or actual months (Also refer paragraph 14.5).

Introduction of Accounts

4. All Term deposit accounts are required to be KYC complied i.e. KYC is done and
is not due. Introduction need not be insisted upon if the prospective account holder
maintains a current / savings account with valid KYC. (For detailed instructions on
"Introduction", refer Chapter on Deposits General).

Need to open Savings Bank Accounts

5. It is desirable that the Term Deposit account holders also maintain Savings Bank
accounts with the Bank so as to avoid delay in disbursement of interest on term
deposits or inconvenience to the customer having to call on the Branch to collect
interest. Accordingly, the customers should be suitably advised about the need
to have Savings Bank account also at the Branch. For this purpose, while issuing
Term Deposit Receipts, Branches should attach thereto the slips with the
following wordings printed thereon.

``For your benefit and convenience, may we suggest that you open a Savings Bank
Account with us and give us instructions to credit thereto, half yearly interest on
this Term Deposit Receipt. Your interest will earn interest."

Types of Accounts

6. Term Deposit accounts may be opened in the names of :

(i) Individual - Single Accounts

(ii) Two or more individuals - Joint Accounts

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(iii) Sole Proprietory Concerns

(iv) Partnership Firms

(v) Illiterate Persons

(vi) Blind Persons

(vii) Minors

(viii) Limited Companies

(ix) Associations, Clubs, Societies, etc.

(x) Trusts

(xi) Joint Hindu families (accounts of non-trading nature only)

(xii) Municipalities

(xiii) Government and Quasi-Government Bodies

(xiv) Panchayats

(xv) Religious Institutions

(xvi) Educational Institutions (including Universities)

(xvii)Charitable Institutions

For detailed instructions for dealing with these accounts, refer Chapter on Deposits -
General.

Opening of Accounts

7.1 To fall in line with the RBI’s guidelines on Know Your Customer (KYC) policy the
account opening form has been modified. The Branches are required to obtain the
latest account opening form while opening Savings Bank, Current Account, all types
of term deposits, BOI Savings Plus, BOI Current Plus, Overdraft and Cash Credit
accounts.

431
A new form is to be obtained at the time of opening of accounts for new customers
and for opening an additional account in an existing account title (within the same
CUST ID), only additional account opening form is to be obtained. For example,
if A and B have earlier opened Savings Bank Deposit Account (having valid
CUSTIDs) where this new form has been obtained and in case they desire to
open a Term deposit account, the additional form need only to be obtained. The
new account opening form should be obtained in all existing accounts also in a
phased manner. The Account opening form has been annexed as APPENDIX
XXVII to Chapter 2 – Deposits - General.

7.1 A The depositors, having internet banking facility with funds transfer option,
can book FDR online. An E- mail advice will be sent to the customer on registered
E mail ID and no physical advices will be sent for Term Deposits booked through
net banking. In case no Email ID is registered, customer has to collect Term
Deposit receipt from the Branch. Customer can check Term Deposit holdings on
Term deposit summary page on next working day. For liquidation of the deposit
the customer is required to submit E- mail advice. The Term Deposit Online
facility will be limited to opening of TDR, Nomination and premature Closure of
eTDR for single mode of holding. The customer need to visit the branch for all
other activities related to TDR like Loan against TDR, etc.

Nomination in Term Deposit Accounts

7.2 For detailed instructions please refer Chapter 2 on Deposits - General.

Obtaining Permanent Account No. (PAN)

7.3 With effect from 01.11.1998 quoting of PAN. is compulsory. For details
please refer to Chapter 2 on Deposits - General.

KYC requirements

8. The KYC requirements as per the category must be ensured especially with
respect to Beneficial Owners while opening the account. Branch is to be guided
by the CKYC procedure at the time of opening the account as advised by Head
Office, time to time (available in Star Desk). In case CKYC ID is provided by the
individual customer, the original KYC documents may not be insisted. Instead a
copy of the documents entered under the CKYC Id should be kept for the Branch
record. In case the KYC data of a particular customer as per CKYC registry portal
is different from the data provided for by him/her, the Branch has to insist on new
proof to match the modification in KYC details.

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Paying-in-Slips

9. The depositor(s) should fill in the paying-in-slip at the time of depositing money.

Rates of Interest and Minimum Amount of Deposit

10. Rate of interest payable on Monthly Income Certificates is the same as that
payable on Term Deposits of equivalent periods. Head Office keeps Branches
informed of the rates of interest and changes therein from time to time

10.1 Branches should not accept Term Deposits beyond a period of 120 months,
in terms of the Reserve Bank of India directive. Any deposit for periods beyond
120 monthscan be accepted only in case of court order with clear mandate for
the same. It should be so indicated on the system by selecting special category
indicator in finacle as ‘C’.

10.2 The minimum maturity period for term deposits has been reduced to 7 days
from the present 15 days. The minimum amount per single deposit for period
between 7 days to 14 days will be Rs. 10,000/-.

Minimum Amount of TDR’s (Over the counter)

Term Deposits Metro & Urban Rural & Semi-Urban

Double Benefit Deposits Rs.10,000/- Rs.10,000/-
Branches

Fixed Deposit (Minimum per Receipt) (Minimum per Receipt)

Monthly Income Certificate

Quarterly Income Certificate

Short Deposits Rs.10,000/- Rs.10,000/-

Recurring Deposit Rs.500/-

(Minimum per Receipt) Rs.500/-
(Minimum per Receipt)

(Minimum monthly instalment

amount)

In case of Term Deposit created through the Retail Internet Banking, the minimum
amount shall be Rs -10000/-.

Please note the following exceptions of minimum amount criteria for term deposit
receipts and where extant instructions to be followed:

i) Automatic renewal

ii) Subsidy kept under Government sponsored schemes, Margin Money Deposits,

433
 Earnest Money Deposits and Court attached / ordered deposits.

iii) In case of automatic renewal, while it has been made as an exception from the
minimum size criteria, branches may advise the customers to build up their
deposit balance as per this new criteria.

Preparation and Issue of Deposit Receipts

11. Deposit Confirmation/Renewal Advice are issued on normal computer

stationery (continuous stationery) in all CBS Branches wef 01/04/2006. However
in case of customers’ requests for advances against Term Deposit Receipts print
the receipt on the security receipt. This is because such receipt needs to be
discharged and kept by the branch under lien as per the present terms and
conditions of such advances.

11.1 “When the period prescribed is a calendar month running from any arbitrary
date, the period expires with the day in succeeding month immediately preceding
the day corresponding to the date upon which the period starts that if the period
starts at the end of a calendar month which contains more days than the next
succeeding month, the period expires at the end of the later month".

11.2 A deposit is made on 11-02-2005 for six months. It falls due for payment on
11-08-2005, i.e. 6 months after the date of deposit. A deposit made on 30-08-
2005 for 6 months will become due for payment on the last day of the month of
February 2006 i.e. on 28-02-2006. (Normally the Receipt should have become
due on 30th but there are only 28 days in February 2006).

11.3 When the due date of payment of a deposit is a holiday or a non-business

working day, interest should be paid for the intervening holiday/non-business
working day, irrespective of whether the depositor seeks repayment on the
succeeding working day or later on e.g. If the Due Date of payment of a Term
Deposit is 01-04-2006 and 01-04-2006 and 02-04-2006 happen to be holidays
and if the depositor seeks payment on 04-04-2006 (or on any subsequent date)
and not on 03-04-2006, which is the immediate succeeding day, interest in such
case is payable for 1st and 2nd April 2006 only. Interest so payable should be
calculated on the maturity value in case of Double Benefit Deposits and Recurring
Deposits and on the principal amount in case of other term deposits.

11.4 The due date for a Short Deposit is calculated by including the date of
deposit and by excluding the date of payment. A deposit made on 23-11-2005 for
91 days will mature on 22-02-2006 as follows:

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8 days November (including the date of deposit)

31 days December

31 days January

21 days February (excluding the date of payment)

Total 91 days.

11.5 Where upcountry cheques are issued for obtaining the Term Deposit
Receipts, Branches should not issue deposit receipts by giving immediate credit
for upcountry cheques even if the deposits are kept for more than six months. In
such cases, Branches should purchase these cheques by charging usual
exchange rates for such purchases.

11.6 Branch has to enter the details properly in the System as per the Account
opening form. Accordingly, the Receipt is printed by the System. The receipt will
be printed after receiving of cash or authorization of transfer entry. The Receipt
should be delivered to the depositor on surrendering the counterfoil of the relative
paying-in-slip.

11.7. The signing powers for Term Deposit Receipts are as under-

Category Signing Power

(A) Singly
i) Section II- Special Instruments upto Rs.25,000/- or
Assistants/ Cashier in – equivalent in Foreign Currency
charge
Section I – Officers Instruments upto Rs.50,000/- or
equivalent in Foreign Currency

(B) Jointly
ii) Jointly where one of the Instruments above Rs.50,000/- or
signatory should be from equivalent in Foreign Currency
Section I
Note: At one-officer Branches where the Manager is the only official in the
supervisory cadre, the second signature would necessarily have to be that of clerk-
cashier having authority to sign under Section II.

(b) Where the first signature is that of a Special Assistant authorized to sign
under Section I, the second signature should be that of an officer with signing
authority;

(c) Where the first signature is that of a Special Assistant/Clerk-Cashier

authorized to sign under Section II, the second signature should be that of an

435
officer having authority to sign under Section I.

It is incumbent on the Officer/Special Assistant/Clerk-Cashier who signs first to

satisfy that the second signature is obtained in the manner specified above.
Authorized signatories should append their signature code numbers while signing
Term Deposit Receipts.

11.8 Branches should bear in mind that Deposit Receipts should be issued strictly
in accordance with RBI instructions/directives. Any violations thereof will be viewed
very seriously by Head Office and also by Reserve Bank of India. Branch
Managers should also note to verify this aspect during test checks. Receipt cannot
be generated / printed without entering the date in the system.

11.9 The Term Deposits receipts in the name of Govt. Deptt. / Institutions etc.
should invariably bear the full name of the same and not the abbreviations

Custody of Undelivered Term Deposit Receipts

12. Term Deposit Receipts which remain undelivered for over a week from the date
of issue should be kept in a safe/cupboard under dual control till they are delivered
to the concerned depositors. Proper record of such receipts should be maintained
in a pass book for future reference.

Due Date Diary and Advice of Maturity Date

13.1 A deposit falling due on a Sunday or a Bank Holiday is payable on the

succeeding working day. Now system generates the due date of the deposit
receipts.

13.2 While sending Maturity Date Advices, Branches should also attach thereto
latest printed pamphlet regarding different types of plans available for investment.

13.3 Additionally, if a Term Deposit account holder/s desire/s to give advance

disposal instructions for the Term Deposit Receipts on maturity date, the same may
be accepted by the branches by obtaining suitable request letter from the
depositor/s as per specimen given in Appendix VII /the instruction for automated
renewal as inserted in latest additional account opening form and ensure to act
upon such instructions on the due date list generated by system. The relative Term
Deposit Receipts duly discharged with disposal instructions duly recorded on the
same should be lodged with the Branch along with the request letter, so that the
Branch can act upon the said instructions on due date. The Term Deposit Receipts
should be held by the Branch in safe custody, for which a safe custody receipt
should be issued to the depositors. Please note that the Term Deposit shall be

436
renewed for a period same as that of the original (preceding) period at the rate
prevailing on the date of renewal if no clear mandate is given by the depositor at
the time of opening of the account.

13.4 On the due date, an advice should be sent to the depositors informing
him/them about carrying out of his/their instructions and requesting him/them to
return the safe custody receipt/s for cancellation/amendment as may be
applicable. Vigorous follow up has to be made till the safe custody receipt is
surrendered by the depositor/s duly discharged for cancellation/amendments. It
should be importantly ensured that the renewed term deposit receipt should not
be handed over to the customer, unless the safe custody receipt is surrendered by
the depositor, if customer has given instruction to renew automatically, the system
renew it on the maturity date.

13.5- At times it is noticed that the depositors may not be in favor of revealing
details of deposits to other members of their family. Therefore, it has been decided
to incorporate a clause in the term deposit account opening form seeking a
mandate from the depositors in this regard giving an option to the customers to
waive notices if so desired.

“I / We would / would not like to receive intimation of impending due date of deposit
by Post / Hand delivery”.

Calculation & Payment of Interest

14. Calculation of interest is done by the system, however to understand the

accounting Procedure and the rate of interest we follow it

14.1 Branches should be guided by the communications received periodically on

Interest Rates on Deposits by our Bank.

14.2 However, existing deposits shall continue to run upto maturity at originally
contracted rates.

14.3 In terms of the Reserve Bank of India directive, interest should be calculated
at quarter or larger intervals (and not monthly). However, if any depositor insists
on monthly payment, interest on Fixed Deposit, Branches may agree to do so,
provided that the amount of interest paid every month is not more than the
discounted value of the interest for one month, so that even if interest is allowed
on the interest so paid, the aggregate amount (i.e. amount of interest paid monthly
together with the interest that may accrue on the amount so paid in one month)
would not exceed one month's interest on the deposit calculated on a quarterly
basis. Branches should follow the guidelines given in paragraph 9.1 & 9.2 of

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Chapter 8 on `Monthly Income Certificate' in this connection.

14.3-A The Reserve Bank of India directive permitting payment of 1% p.a.

additional interest does not apply to minor son/daughter of the deceased
employee and therefore, banks are not permitted to allow additional interest on
deposits accepted from such minor sons/daughters. In the case of term deposit
standing in the joint names of the employee with his/her minor child, the additional
interest of 1% would continue till the date of maturity of the original deposit
irrespective of the intervening incident like the death of the employee. [Also please
refer paragraph 149.1 of Chapter 2 on Deposits-General]. This is applicable only
if the staff /ex staff is first holder. No additional rate of interest is payable if the
staff /ex staff is not first holder even if the money belongs to the staff (Please refer
to Para 152 in Chapter 2).

14.3-B Interest on fixed deposits is being paid on simple interest basis either half
yearly or annually. However, Branches may pay interest on fixed deposits at the
end of each year, duly compounded for the year. This will help depositors who
need to make annual payments for various purposes annually and in addition,
earn higher interest, on their investment.

14.4 In terms of the Reserve Bank of India directive, bank should not accept
deposits for a period longer than ten years (except deposits by Court Order).
However, Branches may accept Fixed Deposits for a period of six months and
above for any periods subject to a maximum period of ten years, in multiples of
complete months or even for a period where the terminal month is incomplete.
For example, deposits can be accepted for 13 months, 41 months, 38 months and
12 days, etc. However, the payment of interest for the incomplete terminal quarter
of terminal month would be in accordance with the rules stated in paragraph 9.3
of Chapter 8 on ‘Monthly Income Certificates'

14.5. Mode of calculation of Interest on Short Deposits and Fixed Deposits for
periods less than 12 months:

Short Deposits
On deposits repayable within 179 days Interest should be paid for the actual number
(Short Deposits) of days on the basis of 365/366 days in a
year.
Fixed Deposits
One deposits repayable after 179 days
(Fixed Deposits)
Where the terminal month is incomplete. Interest should be calculated for the
completed months and the actual number of
days on the basis of 365/366 days in a year.

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 Where the terminal month is complete. Interest should be calculated for actual
months.

14.6 Interest on deposits ceases on maturity of the deposits. Normally, the deposits
get Auto-renewed on the maturity date. However, if not done so, Branch has to
inform Data Centre.

Fixed and Short Deposit Registers

15. All details of the accounts are available in the system, if they are entered
properly by the Branch.

15.1 The amounts of interest debited to the Profit and Loss Account for different
half-years are credited to separate Sundry Deposit Accounts for each half-year. At
the time of actual payment of interest, the respective Sundry Deposit accounts are
debited and the total amount of interest credited to the depositor's account (or paid
in cash). It should be noted that the interest on the current period of half-year which
is not yet over, is debited to the Profit and Loss Account-Interest on Fixed Deposits.

Posting in the System

16. The names of account holders and the instructions regarding repayment as
shown on the Account opening Form are to be entered in the system while opening
the account.

16.1 The Rate of interest is changed in the System as per directions of Head
Office

Payment of Half-Yearly Interest on Fixed Deposit Receipts

17.1 At the request of depositors, half-yearly interest on Fixed Deposits may be

credited to their accounts on 1st October and 1st April even without the production
of Receipts.

17.2 Interest credit instruction is given at the time of opening of account. There is
column for this purpose in additional account opening form

17.3 The standing instruction cards received from the depositors, should be kept
in a separate card cabinet file. The instructions should be entered in the System.

17.4 As per the standing instructions from the depositors, Branches are
sometimes, required to remit monthly/quarterly/half-yearly interest on the term
deposits for credit of account of a specified third party. While effecting such

439
remittances, Branches should merely state to the beneficiary that the amount is
remitted as per the instructions from the depositor and nothing more except where
circumstances call for giving additional information or when the remitter specifically
advises to do so.

17.5 When a depositor gives standing instructions at the time of issue of the Fixed
Deposit Receipt to credit half-yearly interest to his account but does not desire to
keep the Receipt in a safe custody account with the Bank, a suitable note (that the
interest is payable half-yearly and should be credited to the current or savings
account of the depositor) should be made on the back of the Deposit Receipt. In
respect of the Fixed Deposit Receipts held in safe custody, standing instructions
to credit the half-yearly interest to the accounts of depositors may be carried out
free of charge. If a depositor gives the standing instructions later (when the Bank
is not in possession of the Fixed Deposit Receipt), such standing instructions
should be recorded immediately in the system and the depositor requested to send
the Deposit Receipt to the Bank to make a note thereon as referred to above. (If
the depositor does not comply with the request, the matter need not be pursued,
but a note should be made in the Fixed Deposit Ledger and the Register).

Payment and Renewal of Term Deposits

a)New Term Deposit receipts are issued at the time of renewal of the receipts

b)Lien is marked in the system and on the Term deposit Receipt manually

18.2 A depositor may want to renew only the principal amount of the Deposit
Receipt and draw the accrued interest. The accrued interest in such case may be
transferred in the account of the depositor.

18.3 System automatically renew it if instruction of automated renewal is given by

the depositor.

18.4 Deposit Receipts issued by the Bank are NOT TRANSFERABLE by

endorsement. The amount of a Deposit Receipt can be paid only to the depositor
on identification and in accordance with the instructions on the card. Payment of a
Deposit Receipt to a third-party must be authorised by a separate letter from the
depositor which should accompany the Deposit Receipt duly discharged. The
signature on the letter of authority must be verified and the person identified before
payment is made to him.

19. Sometimes a depositor may forward to the Bank an undischarged Deposit

Receipt with a covering letter requesting renewal of the deposit. In such a case,

440
the Deposit may be renewed if the covering letter is signed as required for
repayment of the deposit noted on the card/Account opening form. Before the
deposit is renewed, the signature(s) on the covering letter should be verified. In
case the depositor has not given instructions on maturity, the default option that
the deposit shall be renewed for same period as of the expiring deposit at the rate
prevailing on the renewal date. If depositor has already given instruction to renew
automatically in such case system renews the Term deposit Receipt on maturity

20. In respect of acting on the basis of communication received by way of letters,

fax, emails etc. for making third party payments, the branches must take extra
precautionary measures. Branches should ensure genuineness of the
communication by means such as contacting the depositor/s either over telephone
or by other available means of communication and record the same on the
authority letter. Otherwise payment should be credited to the account of the
depositor.

21. In case of renewal of Term Deposits frozen by enforcement authorities, while

obtaining the request letter from the depositor also advise him to indicate the term
for which deposit is to be renewed. In case the depositor does not exercise his
option of choosing the term for renewal, system renews the same for a term equal
to the original (preceding) term.

Overdue Deposit Receipts

22. Renewal of overdue deposit receipt and interest for the overdue period are
governed by the Reserve Bank of India directives issued from time to time.
Branches must adhere to the terms of the directives in this regard.

22.1 The rules governing renewal of overdue deposit and interest payable on
overdue deposits are as under.

i) Interest on overdue receipt for the overdue period would be payable only when
the receipt is renewed from the date of maturity stated on the receipt. The interest
allowed shall be at the appropriate rate operative on the date of maturity, of such
overdue deposits which shall be payable only on the amount of deposit so
renewed. In case a depositor wishes to renew an overdue deposit from the date
of presentation, the deposit would not earn interest from the date of maturity
(original due date) upto the date of presentation of the overdue receipts.

ii) Renewalof domestic overdue term deposits shall be for a period extending up
to at least 15 days beyond the date of renewal. Such renewed receipts will,
however earn interest from the date of maturity at the appropriate rate as

441
mentioned in the preceding paragraph. In the event premature withdrawal of such
renewed deposit is sought within such extended period of 15 days no interest shall
be payable at all on such deposits from the date of maturity of the old deposit
receipt.

iii) Deposits can be accepted for a maximum period of ten years.

iv) In the cases of overdue deposits renewed, interest for the overdue period
could be paid in cash at the time of presentation for renewal, only if a calendar
quarter (viz. 31st March, 30th June 30th Sept. and 31st Dec.) has intervened
between the date of (original) maturity and the date of presentation for renewal. If,
however, the depositor has not originally opted for quarterly payment of interest,
the interest for the overdue period would be payable in cash at the time of
presentation for renewal, only if a calendar half-year (viz. 30th June or 31st
December) has intervened between the date of (original) maturity and the date of
presentation for renewal. In either case, the interest would be payable only upto
the end of previous quarter/half-year as applicable.

v) Some depositors may desire to renew an overdue deposit from the date of
maturity including the interest accrued on the receipt upto the date of maturity.
Such requests may be acceded to and the interest upto the original date of maturity
may be added to the principal deposit amount and the aggregate renewed as of
the date of original maturity. In such cases, the accrued interest would also qualify
for interest for the overdue period. Currently, all deposits are auto-renewed for the
original contract period. However, if any deposit is not renewed or overdue and the
depositor wants to renew/ encash the deposit, system calculates the interest while
renewing / encashing the deposit, as desired. The above procedure is mentioned
here to get acquainted with the procedure of interest on overdue deposits.

Automatic renewal of maturing Term Deposits

22.A.1 With effect from 15th March, 2002, all maturing Term deposits would be
automatically renewed for the same tenure (as the maturing deposit) at the rate of
interest applicable on the date of maturity if no intimation has been received from
the depositor as regards to renew the concerned deposit for a shorter or longer
period. As Per the RBI guidelines dated July 02, 2021, if a Term Deposit (TD)
matures and proceeds are unpaid, the amount left unclaimed with the bank
shall attract rate of interest as applicable to saving account or the contracted
rate of interest on the matured TD, whichever is lower.

22.A.2. In case the depositor/s send an advance (before the date of maturity)
intimation, expressing a desire to renew the concerned deposit for a shorter or

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longer period then deposit would be renewed according to the depositor/s’s desire.

22.A.3. Various situations that could arise relating to renewal of deposits:-

Deposit has been The depositor comes within The amount will be repaid to him in
15 days of date of automatic the manner he desires without any
renewed renewal and does not wish to interest for the intervening period
automatically have the deposit renewed
Deposit has been The Depositor comes to the The applicable interest for the
renewed branch after 15 days but intervening period as per the Term
automatically before the end of the fresh Deposit Rules (i.e. interest at the
due date of the automatically rate applicable for the period the
renewed receipt and wishes deposit has remained with the Bank
to have the funds back with quarterly compounding) will be
paid to the depositor along with the
Principal. However, penalty for
before maturity payment would be
levied as per the guideline issued by
head office from time to time.

The matter regarding imposing of penalty in case of premature closure / withdrawal

of deposits (Term / Short term deposit) as decided by Bank from time to time must
be followed in this regard .

22.A.4 The print outs would be taken out and handed over to the customer when
he calls at the branch. The Authorising Officials however have to carefully verify
that the automatic renewal details appear correctly in the system.

22.A.5. The branches are to arrange for suitable rubber stamp with wordings given
below and use it on new Account opening cards and Pay in Slips of Term deposits
including:

“All maturing term deposits would be renewed automatically on the due date for
the same period at rate of interest ruling on the date of maturity unless intimated
otherwise by the depositor/s in good time”

22.A.6. The following instructions are also applicable for renewal of deposits:

i) Fresh receipts would be issued

ii) In case of Under Lien receipts notings would be made on the reverse of
the receipts in the space allotted for the same

iii) TDS would be applicable as per extant guidelines

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iv) For every automatic renewal, intimation would be sent to depositor/s

Payment and Renewal of Deposits before Maturity

23.1 Depositors may request repayment of their deposits before maturity.

Repayment of term deposits before maturity is permissible in terms of the
directives of the Bank issued from time to time. Branches should be guided by the
instructions conveyed by Head Office from time to time in respect of pre-closure
penalty.

For the purpose of this directive, where:-

(i) on the death of the depositor, the deposit is allowed by the Bank to be held in
the names of one or more legal heirs or legal representatives of the depositor,
either jointly in their names or along with other persons or separately in their
names by splitting up the deposit; or

ii) the deposit has been made in the name of one person alone and the name of
another is allowed to be added by the Bank; or

iii) the deposit has been made in the name of two or more persons and the names
of one or some of them are allowed to be struck off or substituted by the Bank,
such transactions shall not merely on that account be regarded as involving
renewal of the deposit or premature repayment of the deposit provided the
original term of the deposit is not reduced in any case.

23.2. Payment of interest on the Term Deposits of a deceased depositor-

As per RBI directives in the event of death of the depositor before the date of
maturity of the deposit and the amount of the deposit is claimed after the date of
maturity, the bank shall pay interest at the contracted rate till the date of maturity.
From the date of maturity to the date of payment, the bank shall pay simple interest
at the applicable rate operative on the date of maturity, for the period for which the
deposit remained with the bank beyond the date of maturity.

However, in the case of death of the depositor after the date of maturity of the
deposit, the bank shall pay interest at saving deposit rate operative on the date of
maturity from the date of maturity till the date of payment.

23.3 Interest on premature withdrawal/renewal: In the case of Fixed Deposits and

Short Deposits, interest will be paid at simple rate of interest on premature
withdrawal/renewal of the deposit.

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23.4 The Manager may sanction repayments of Term Deposits before maturity
without limit for the specific purpose of re-depositing the full amount with the Bank
to earn a higher rate of interest. In all other cases, the Managers and Zonal
Managers may sanction repayment of Fixed/Short Deposits before maturity upto
the limits authorised by Head Office. (Please refer to the Delegation of Powers in
this respect). Branches should not accede to the requests for splitting up of Term
Deposit Receipts before maturity.

23.5 Request for and repayment before maturity of a Term Deposit in joint names
should be made by/to ALL the depositors and ALL of them must give their
discharge on the back of the Deposit Receipt, irrespective of the instructions given
to the Bank regarding the mode of operation on the account viz., "either or survivor"
etc. Where the joint accounts are operated upon by "Former or Survivor", such
request can be made under the signature of the FORMER account holder only.

23.6 Repayment before maturity of a Term Deposit standing in the single name of
a deceased depositor or in joint names where one of the depositors is deceased
may be approved by the Zonal Managers, if the amount is within their discretionary
powers or alternatively may be referred to Head Office for decision. (Also refer the
Chapter on Deposits-General).

Extension of Period of Deposit before Maturity

24.1 Renewal of deposit before the date of its maturity shall not be regarded as
involving premature repayment provided the deposit is held by the Bank after the
date of renewal for a period longer than the remaining period of the original
contract; on such renewal the rate of interest in respect of the period upto the date
of renewal shall be the rate of interest applicable for the period during which the
deposit has remained with the Bank upto the date of renewal and in respect of the
period after the date of renewal, at the rate of interest applicable for a period equal
to the period of renewal.

24.2 Extension of the period of deposit as stated above does not invoke the
provisions of penal interest for premature withdrawal of deposit.

24.3 This provision of extension of period is applicable to Fixed Deposits/Short

Deposits. Extension of period must be allowed only on the written requests of ALL
depositors and surrender of original Receipt duly discharged by ALL depositors.
Where the joint accounts are operated upon by `Former or Survivor', such requests
can be made under the signature of the FORMER account holder only.

24.4 The procedure for extension of period of deposit is similar to the repayment

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of deposit before maturity but without applying penal rate of interest.

24.5 The extended deposit should be treated as a new deposit and a new Receipt
should be issued.

Procedure for account opening value dated prior to 15 days.

It has now been decided by the Top Management in the ALCO meeting to restrict
any value dating of TDR at branch level (HOBC-115/248 dated 16.11.2021). Value
dating of TDR shall be allowed at Zonal Office level with the specific approval of
Zonal Manager/ Zonal Manager In-Charge for any such deserving cases (as
stipulated in point no 6 of Br Cir 109/20 dated 07.04.2015).The procedure for
opening value dated TDRs at Zonal level remains unchanged

Premature withdrawal of Deposits Renewed before Maturity

24.6 Sometimes, a customer after renewing the deposit before maturity, may
request the Bank to pay the deposit even before the expiry of the period of the
original contract. Whether a renewal amounts to a premature withdrawal or not
depends upon either the subsequent withdrawal is made before the expiry of the
period of the original deposit or after the expiry of that period. If the subsequent
withdrawal is made after the expiry of the period of the original contract, the
renewal does not amount to a premature withdrawal of the original deposit. If the
subsequent withdrawal is made before the expiry of the period of the original
contract, the renewal will certainly amount to a premature withdrawal of the original
deposit. Branches should be guided by the instructions conveyed by Head Office
from time to time in respect of pre-closure penalty.Whenever, a deposit is renewed
before maturity, Branches may affix a rubber stamp on the fresh receipt as under:

Premature Renewal of Receipt No ..................... Dated…………..

Maturing on ..............

Transfer of Fixed Deposits Before Maturity from One Branch to Another

25.1 The Manager may accede to requests by depositors for transfer of Fixed
Deposits before maturity to another Branch for genuine requirements of the
depositors.

25.2 Procedure at Transferring Branch: The depositor's letter signed by ALL

depositors for the transfer of the deposit should be taken and kept on the record of
the Branch. A fresh specimen signature card (Form TD IS) duly filled in and signed
by the depositor should also be taken (for the use of the Branch where the deposit

446
is to be transferred). A note reading "At the depositor's request, this deposit with
interest is payable at Branch subject to the other terms and conditions of the
contract of deposit”, should be made on the face of the Deposit Receipt under the
signatures of the Branch Manager and the Deputy Manager.

25.3 The fresh card (taken with the letter of request) with all the signatures thereon
authenticated by an officer of the Branch should also be sent. The system takes
care of accounting procedure.

25.4 If the account holder so desires, the Fixed Deposit Receipt may be returned
to him with the note indicated in paragraph 25.2 above. But the full particulars of
the deposit, such as, the full name and address of the depositor, the date of
deposit, the number and amount of Deposit Receipt, the due date, etc. should be
advised to the transferee Branch. Fresh Account opening form mentioning the
special instruction should be obtained and signature of the depositor should be
verified and to be sent to other branch.

25.5 Procedure at Transferee Branch: The Deposit Receipt, if received from the
transferring Branch, should be forwarded to the depositor, upon change of Sol ID
by the transferor branch, account is transferred to transferee branch.

25.6 If the request for the transfer is made by the depositor at the Branch to which
the transfer is to be made, that Branch should forward the letter of request
addressed to the transferring Branch together with the Deposit Receipt and the
card, so that the specimen signatures on the card can be authenticated by the
transferring Branch.

Payment or Renewal of Deposits at Other Branches

26. Account is transferred to transferee branch immediately upon Change of

Sol ID by the Transferor branch.

Renewal and delivery of deposit receipt to customer which is received from

another bank for collection

26.A. The IBA Code for Banking Practice provide that in case a deposit receipt is
received for collection from another bank, the receipt should not be renewed by
the issuing bank and delivered to the customer directly. Instead, the issuing bank
should either pay to the collecting bank or else, the instrument should be returned
if the issuing bank has any valid reasons not to pay.

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Notice of Assignment

27.1 When a Branch receives notice from a third-party of an assignment of the

amount due under a Deposit Receipt of the Bank, the matter should immediately
be referred to Head Office for instructions. In such a case, the Branch should ask
to see the original of the assignment together with the notice of assignment signed
by the assignor, i.e. the depositor. It is only where the assignor has refused to sign
the notice that the assignee is entitled to give notice of the assignment to the Bank.
The assignee, on producing the assignment duly stamped and also producing the
Deposit Receipt, can demand payment of the deposit on the due date and can give
the Bank a good discharge for such payment without any further signature by the
assignor. Though it is advisable to obtain the discharge of the depositor on the
Deposit Receipt before payment thereof on the due date, such discharge cannot
be insisted upon. A note of the receipt of notice of assignment should be made
against the relative entry in the Deposit Register and Ledger under the initials of
an officer of the Bank.

27.2 The Bank is entitled to set off the debts, if any, due to the Bank by the
depositor at the time the notice of assignment is received by the Bank. When the
Bank receives the notice of assignment, the assignee should be informed of the
amounts due from the depositor and requested to note that the Bank will exercise
its right of set off on the amount that will become due under the Receipt.

Term Deposit in Lieu of Earnest Money

28.1 Branches are sometimes required to issue Term Deposit Receipt on account
of earnest money, security deposits, tender deposits, etc., as security for
performance of contracts and payable by contractors to government/quasi-
government departments or any other institution or agency. The Central
Government have amended Rule 274 of the General Financial Rules, 1963, so as
to include therein deposit receipts of all scheduled banks as acceptable securities.
All local bodies are free to choose any bank depending upon operational
convenience and it is not incumbent on them to have banking arrangement with
only one Bank. As per Reserve Bank of India clarification there is nothing in the
instructions given by the Government to the local bodies/statutory authorities
which require them to deal exclusively with State Bank of India or any particular
bank. In case any difficulty is faced by Branches in this regard with any
Government department, etc. Branches should advise Head Office through their
respective Zonal Office to take up the matter with the concerned Government
department for doing the needful.

28.2 Branches should obtain an application (Specimen - Appendix II) from the

448
depositors before issuing the term deposit receipt in favour of the Government
department or any other institution or agency. While issuing a term deposit receipt,
in addition to the name of the concerned Government department or any other
institution or agency, the caption of the tender giving brief description of job work
and the number and date of the tender should also be mentioned in the term
deposit receipt with a view to identify the particular tender for which the deposit
receipt has been issued. Accordingly, term deposit receipt in lieu of earnest money
may be issued in the following form:

“Name of the depositor – A/c Government Department / representatives”

28.3 For the purpose of payment of interest on term deposit to the depositor, a
letter from the Government department or any other institution or agency in
whose favour the term deposit receipt is issued, authorising payment of interest
to the depositor(s) is required to be obtained. This letter should be submitted by
the depositor along with the application as stated in paragraph 28.2 above. In the
event of any dispute between the depositor and the Government
department/institution/agency in whose favour the term deposit receipt has been
issued and if the authority to pay interest is revoked by the Government
department/institution/agency interest on such term deposit receipt becomes
payable only to the Government department/institution/agency in whose name
the term deposit receipt has been issued.

28.4 When any Government department so accepts a term deposit receipt from
the contractors, it is obligatory on the part of that Government department to seek
confirmation from the concerned Bank which has issued the term deposit receipt.
Branches should confirm the issuance of deposit receipt when requested by the
Government department, etc.

28.4. A. Branches are, however, permitted as a special case, to issue Deposit at

Call Receipts to the tenderers (contractors) for the amounts earmarked against the
earnest money held in current accounts with them for submission to the
Government Departments, Local Bodies with the tender papers relating to
construction contracts. Such a course of action will not be construed as a violation
of the RBI directive on rates of interest on deposits.

28.5 Withdrawal of the Earnest Money Deposit: If any contractor i.e. the
depositor who has obtained the term deposit receipt requests for withdrawal of the
earnest money deposit on the plea that he had not participated in the bid or he was
not awarded the contract, Branches should insist on a release order from the
Government department or any other institution or agency in whose favour the
term deposit receipt has been issued for releasing the deposit amount. However,

449
in cases where the contractor did not submit his tender in time and therefore, the
Government department refuses to issue a release order, Branches may pay the
amount of term deposit receipt to the depositor without insisting on the release
order from the Government department provided they are fully satisfied that the
depositor i.e. the contractor was unable to submit the tender in time for genuine
reasons.

28.6 Loss of Term Deposit Receipt in Lieu of Earnest Money: Refer to

paragraph 31 below or the procedure for issuance of a duplicate term deposit
receipt when the original receipt issued in lieu of the earnest money deposit is
reported lost. Deposit Receipt under Lien

29. Whenever a lien on a Deposit Receipt in favour of the Bank is created, a

note to this effect Should be prominently made in the system

Advances against Bank's Fixed/Short Deposit Receipts

30. For detailed instructions regarding advances against Fixed & Short
Deposit Receipts, refer to the Volume on Advances and circulars issued on the
subject from time to time by the Bank.

Lost Deposit Receipt

31.1 When a depositor reports that he has lost or misplaced his Deposit Receipt,
he should be asked to notify the Branch in writing. The signature of the depositor
(on the letter) should be verified and a note “Deposit Receipt Reported
Lost/Misplaced" should be entered in the system quoting the reference of the letter.

31.2 The Manager should consider the circumstances in which the Deposit Receipt
is reported lost or misplaced and satisfy himself that the depositor has made all
possible efforts to trace the lost or misplaced Deposit Receipt. If the Deposit
Receipt is reported to be stolen, the depositor should lodge a complaint with the
police and inform the Bank of the result of the police investigation.

31.3 When the Manager is satisfied that the Receipt is irretrievably lost by the
depositor(s), he may issue a duplicate Term Deposit Receipt against an Indemnity
Letter as per specimen given in Appendix III provided a request in writing is made
by ALL the joint depositors setting out the circumstances of the loss. Branches
should obtain prior approval of the appropriate higher controlling authority for
issuance of duplicate Deposit Receipt in lieu of lost Receipt against Indemnity
Letter, when the amount of the lost Term Deposit Receipt is beyond the delegated
authority of the branch. The Indemnity Letter should be stamped as an agreement
and signed by all the joint depositors - the signatures thereon should not be

450
attested.

31.4 The Indemnity Letter requires to be executed by two sureties. However,

joining of sureties in execution of the indemnity may not be insisted upon except
in cases where the higher Controlling Authority considers that the circumstances
are such that it is in the Bank's interest to insist on execution of the indemnities by
sureties also.

31.5 When a request for advance is made against a duplicate Receipt so issued
or against a Lost Receipt where the depositors have not obtained a duplicate
Receipt, Branches should follow the procedure as detailed in Manual of
Instructions, Volume 3 on ‘Advances’.

31.6 Where a Deposit Receipt sent by the Branch to the depositor by post is
irretrievably lost in postal transit, a duplicate receipt may be issued against a
simple Letter of Request-cum-Indemnity as per specimen given in Appendix IV
duly signed by all the depositors. In such cases Branches should ensure that -

i) All Deposit Receipts are sent to the depositors in India by Registered Post /
Speed Post Acknowledgement Due and to the depositors in foreign countries
by Registered Post.

ii) A proper record is kept of all Deposit Receipts sent by post and
acknowledgement slips obtained duly signed by the depositor(s).

iii) When a depositor reports non-receipt of Deposit Receipt, effort is made to

establish that it is irretrievably lost in transit.

iv) Prior approval of higher Controlling Authority is obtained for issuance of

duplicate Deposit Receipt.

A letter of request-cum-Indemnity (Specimen - Appendix VI) should be signed by

all the depositors in the presence of an Officer. Where this is not possible for
genuine reasons, the Letter of Request-cum-Indemnity should be executed before
an official of Indian High Commission or a Notary Public. Branches should
carefully verify the signature(s) of the depositor (s) on the Letter of Request-cum-
Indemnity.

31.7 When a duplicate Term Deposit Receipt is issued, an appropriate remark to

that effect should be made in the system.

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31.8 Loss of Term Deposit Receipt issued in lieu of earnest money:

Where the depositor i.e. the contractor who has obtained a term deposit receipt in
lieu of the earnest money deposit in the name of Government department, etc.,
(also refer to paragraph 28 above) has reported the loss of the said term deposit
receipt, a duplicate term deposit receipt in lieu of the original reported lost may be
issued after obtaining prior approval of higher Controlling Authority therefor and a
stamped indemnity (Specimen - Appendix V) duly executed and signed by both -
the depositor i.e. the contractor as well as the Government department, etc., in
whose favour the deposit receipt is issued. However, as regards execution by the
Government departments, etc., such an indemnity should be signed by a person
who is authorised to sign on behalf of the Government/quasi-Government
department or any other institution or agency. Branches should also follow the
instructions given in paragraph 31.1, 31.2 and 31.7 above in this connection.

Brokerage

32. No brokerage on deposits in any form to any individual, firm, company,

association, institution, or any other person should be paid except-

(a) to individuals employed as agents for collecting from door to door, deposits
under any special scheme introduced by the Bank for deposit mobilisation, or

(b) in respect of deposits made with the Bank by the Life Insurance Corporation of
India or the Unit Trust of India, representing money at call or short notice. Prior
sanction of Head Office for payment of brokerage in the above two cases must
be obtained.

Deduction of Tax at Source

33. Under the provisions of the Income Tax Act, 1961, Branches are required to
deduct tax at source from the interest payable on term deposits in excess of the
limits prescribed and advised by them through Head Office from time to time.
Deduction of tax at source shall be made from interest payable on Recurring
Deposits also. Non-compliance would attract severe penalties on the bank. System
deducts Tax as per guidelines by Head Office depending upon the directives from
Income Tax Act, time to time.

Payment of Interest/Principal Amount of Deposit-Payment by Crossed

Cheques, etc.

34.1 In terms of Section 40 A (3) of the Income-Tax Act, 1961, payment of any
expenditure to be debited to the Bank's Profit and Loss Account, whether directly

452
or through a Suspense Account, in an amount exceeding Rs. 2,500/- must be
made by a crossed cheque or a crossed bank draft. Crediting the amount into the
payee's account with any Branch tantamount to payment by such crossed
instruments.

34.2 However, the provision of the Section 40 A (3) will not be applied if the
payment could not be made by crossed cheque or bank draft due to "exceptional
or unavoidable circumstances" and the assesse furnishes evidence as to the
genuineness of the payment and the identity of the payee. In this connection, the
hold-up in cheque clearing operations in banks or any other similar circumstances
which is likely to cause reasonable apprehension in the mind of the payee that the
crossed cheque/bank draft will not be cleared expeditiously would constitute
"exceptional or unavoidable circumstances".

35.1 In terms of the Income-Tax (Second Amendment) Act, 1981, repayment of

the deposit amount (together with the interest, if any) of Rs.20, 000/- or more must
be made by an account payee cheque/bank draft/payslip or by crediting the
savings bank account or current account with the Branch of the person(s) to whom
such deposit has to be repaid. [Branches should satisfy themselves about the
identity of their depositors. In this connection it is essential that an introduction in
a deposit account is treated as a substantive step having real significance and not
a mere formality. (Also refer Chapter 2 on "Deposit-General.")]

35.2 As per the provisions of the Income-Tax (Second Amendment) Act, 1981, for
the purpose of arriving at the aggregate amount of Rs. 20,000/- not only the
amount of deposit(s) held by the depositor(s) himself (themselves) but also those
held jointly with any other person(s) with the Branch (on the date of repayment of
any such deposit) together with CHAPTER 7 – FIXED & SHORT DEPOSITS
ACCOUNTS interest, if any, payable on such deposit(s) should be reckoned.
Where, by virtue of this provision being inapplicable (namely, the aggregate
amount being less than Rs.20,000/-) repayment of the term deposit is desired IN
CASH by the depositor(s), a Declaration (Specimen-Appendix VI) should be
obtained from the depositor(s). IT SHOULD, HOWEVER, BE CAREFULLY
NOTED THAT THE BRANCH CANNOT ABSOLVE ITSELF OF THE LEGAL
OBLIGATION CAST BY THE ACT MERELY BY RELYING UPON THE
DECLARATION SO OBTAINED.

35.3 It should also be noted importantly that the failure to comply with the SAID
PRESCRIBED MANNER OF REPAYMENT will render the persons concerned
liable to imprisonment and fine.

35.4 Branches should make suitable notings in bold letters about the prescribed

453
manner of repayment in the Registers/Ledgers of all deposit accounts falling under
the purview of the aforesaid Act so that the repayment of such deposits (renewal
or fresh) will be effected in accordance with the procedure laid down in that respect.

Inter-Bank Call Money Market

36.1 Banks are required by statute to maintain a certain percentage of their

deposits in liquid form, such as cash on hand, balances with Reserve Bank of India,
balances with State Bank of India and notified banks and investments in approved
securities.

36.2 Funds position and cash and securities ratio of Bank of India is managed by
Treasury Branch Head Office: Only a few specified Branches of the Bank are
involved in the process of maintenance of the Bank's funds position. The following
paragraphs are, therefore, intended for the general information of all Branches.

36.3 In order to fulfil the statutory cash and securities reserve ratios, banks have
sometimes to borrow funds "at call" (or at notice) from other banks in the "Inter-
Bank Call Money Market" through approved finance brokers. Effective Call Money
Markets are located at Mumbai, Calcutta, Delhi and Chennai. Whenever the
requirement of funds of the Bank is more than funds available within the Bank,
Treasury Branch, Head office resorts to borrowing from the Inter-Bank Call Money
Market at Mumbai. If necessary, Treasury Branch Head office also borrows from
the Markets at Calcutta, Delhi and Chennai through the Main Branches located at
these centres. Money thus borrowed is usually maintained as balance with
Reserve Bank of India at those four centres.

36.4 The Bank sometimes accepts deposits from institutions like Life Insurance
Corporation of India and Unit Trust of India which may have surplus funds to lend.
These deposits are repayable at a notice period ranging from 3 days to 14 days.
These deposits, though termed "Deposits with Notice”, are outside the purview of
the Reserve Bank of India's directives on rates of interest on deposits. The interest
rates on these deposits are determined by Market conditions.

36.5 Call Money rate changes on day-to-day basis, depending on the demand for
and supply of funds. The rate is subject to the ceiling advised by Indian Banks'
Association/Reserve Bank of India in this regard. Money borrowed "at call" remains
with the Bank only till the opening of business the following day when the lending
banks instruct either for the repayment or for the renewal of the amount lent at the
prevailing Market (or call) rate.

36.6 Sometimes, the Bank may have funds in excess of its requirements, in which

454
case the Bank becomes a lender in the Call Money Market.

36.7 Although the day-to-day transactions relating to borrowing from or lending in

the Call Money Market for the Bank as a whole are controlled by Treasury Branch
Head office and the Main Branches at Calcutta, Delhi and Chennai also sometimes
borrow money at call at their centres on their own account if it becomes necessary
to meet heavy, adverse Clearing and/or to satisfy their urgent cash requirements.

36.8 It is necessary to see that the cost of money at call is not out of proportion to
the advantage the Bank will derive from such borrowing.

36.9 The Bank also has a borrowing limit with Reserve Bank of India at a stipulated
rate of interest. It is not generally advisable to borrow from the Call Money Market
unless the Market rate is less than the rate charged by Reserve Bank of India, or
unless the borrowing limit with Reserve Bank of India falls short of the Bank's
requirements of funds at a particular time.

Foreign Currency (Non-Resident) Accounts

39. Persons who are Indian nationals and persons of Indian origin (except those
holding Pakistani passport) residing abroad, may open Foreign Currency (Non-
Resident) Accounts in designated foreign currencies with certain selected
Branches of the Bank. The funds in foreign currency may be held in Term Deposits
for specified periods in these Foreign Currency (Non-Resident) Accounts with the
selected Branches. The names of the selected Branches are advised by Head
Office from time to time. The manner in which the Foreign Currency (Non-
Resident) Accounts are to be maintained and operated, the rates of interest
applicable and other terms and conditions governing these accounts (as notified
by Reserve Bank of India) are advised by Head Office periodically. (Also refer to
Manual of Instructions Volume 4 Foreign Exchange).

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 APPENDIX I

Specimen of Advice of Maturity Date to Term Deposit Account Holders

Ref. No ...................................................................................... Date

Dear Sir/Madam,

Re: Your Term Deposit Account(s) with us:

Receipt No. Date Amount in the Name(s) of Due Date

We invite your kind attention to the due date(s) of the captioned Deposit
Receipt(s) recorded thereon. You will please observe that the Receipt(s) will
become / have / has become due for renewal / payment on the date(s) indicated
above.

We are confident that you would like to continue the deposits with us by renewing
the Receipt(s) for appropriate period. We, therefore, request you to forward the
Deposit Receipt(s) to us duly discharged on the reverse thereof. Please also let
us have your instructions as to the period for which the amount is to be renewed
and disposal of the interest accrued.

The giving of this intimation as to due date is not obligatory on the Bank, under
the terms and conditions mentioned on the reverse of the Deposit Receipt(s)
and the same is sent entirely as a matter of courtesy and with the intention of
giving better service to our depositors.

Assuring you of our prompt attention and efficient service at all times.

Yours faithfully,

Manager

456
 APPENDIX II
(Paragraph 28.2)
Specimen of Application by contractor(s) to issue Term Deposit Receipt for
Earnest Money payable to Government Departments

Date:

The Manager,
Bank of India

Dear Sir,

Re : Term Deposit Receipt in lieu of Earnest Money__________________

I/We, Mr./M/s.have entered into/agreed to enter into a Contract No.

datedwith (Name of the Government Department/other Agency) for
One of the terms of said Contract requires me/us to obtain a Term Deposit Receipt
from a Bank in favour of______________ (Name of the Government
Department/other Agency) Account myself / ourselves to the extent of Rs.______
(Rupees _______________________________________ ) for the purpose of

2.I/We,_______________ tender herewith cash Rs. __________ / cheque

for Rs. _______________________ in this regard.
3. Kindly issue a Fixed/Short/Call Deposit Receipt for _____days/months for Rs.
(Rupees ) in the name of (Name of the Government Department/ A/c.
other Agency) (Name of the Depositor)
4. I/We, confirm that the deposit in question has been made as and by way of
security for due performance of my/our Contract with Department/Agency. In case
of demand of the whole or part of the deposit by (Name of that, the payment
may be made to ______________________ Department/Agency) (Officer of that
Department/Agency) according to the Bank's rules applicable to such deposits.

5. "Notwithstanding that the above deposit has been made in the name of (name of
the Govt. Department/other agency) A/c. (name of the depositor), I/We (name
of the depositor) request that the interest on the deposit may be paid to (name
of the depositor) in terms of the enclosed letter from (name of the Govt.
Department/other agency) authorising payment of interest to (name of the
depositor)."

Classification: Internal
 APPENDIX III

(Paragraph 31.3)

INDEMNITY LETTER FOR ISSUE OF DUPLICATE TERM DEPOSIT

RECEIPTS

(To be stamped as an agreement)

(NOT TO BE attested)

Name :
Address :
Date :
Bank of India,

Dear Sirs,

Re. : Term Deposit Receipt/s No./s.

dated _______________________________ for Rs.

in favour of ________________________________

due on

I/We was/were until recently in possession of the abovementioned Term

Deposit Receipt/s issued by you in my/our favour.

2. I/Weregret to inform you that the abovementioned Deposit Receipt/s

has/have been either lost or misplaced and cannot be traced inspite of
my/our having made a due and diligent search for the same.

3. I/We
assure you that I/We have not created any right or interest in the
said Receipt/s or in the debt represented by it, in favour of any person
whomsoever.

4. I/We have requested you to issue a duplicate Term Deposit Receipt/s in

lieu of the aforesaid Receipt/s which has/have been lost.

5. You have agreed to accede to my/our above request on the faith and

458
strength of my/our above representations and assurances and on giving
you the indemnities, undertakings and authorities as hereinafter appearing.

6. In
consideration of the premises, I so as to bind myself and my heirs,
executors, administrators, estates and effects/we so as to bind ourselves
and our heirs, executors, administrators, estates and effects hereby agree
and undertake with you and your successors and assigns as under:-

i) to keep you safe and indemnified from time to time and at all times from
and against all claims, demand, actions, proceedings, loss, damages,
liability, costs (legal costs being between Attorney/Advocate and
clients), charges and expenses whatsoever, which may be made or
brought or commenced against you or be paid, sustained, suffered or
incurred by you howsoever as consequence direct or indirect of your
issuing to me/us duplicate Term Deposit Receipt/s as aforesaid;

ii) to pay to you and make good on demand by you the amount of such loss,
damage, liability, costs (legal costs being between Attorney/Advocate
and clients), charges and expenses; together with the interest at
% p.a. from the date of payment by you until reimbursement by
me/us;

iii) to return to you the original Term Deposit Receipt/s as aforesaid should
the same be found by me/us or should again come into my/our
possession, at any time hereafter.

* In consideration of the premises, I/We the undersigned (jointly and

severally) guarantee to you, Bank of India, on demand by you, the due
payment of all moneys payable to you under the foregoing letter by the
executants thereof.

459
Signature :
Name :

Occupation :
Address :

1. Signature :
Name :

Occupation :
Address :

(*To be obtained if sureties execute the Indemnity).

460
 APPENDIX IV
(Paragraph 31.6)
Letter of Request-cum-Indemnity from Depositor/s for Issue of Duplicate
Term Deposit
Receipt in lieu of one lost in Postal Transit

Name : Address :

Date :

Bank of India,

Branch

Dear Sirs,

Re. : Term Deposit Receipt/s No./s.

dated __________________________ for Rs. _____________________issued

by the Bank in favour of due on

You delivered the aforesaid receipt to the postal authorities for onward
transmission to me/us. The postal authorities have, however, failed to deliver the
same to me/us. The said receipt is lost in postal transit. Inspite of my/our having
made due and diligent inquiries with the postal authorities, I/We have been
unable to obtain the said receipt from the postal authorities.

2. I/We have requested you to issue a duplicate Term Deposit Receipt/s in

lieu of the aforesaid receipt which has been lost in postal transit.

3. I/We have not transferred in favour of any person whatsoever any of my/our
right title or interest in the said receipt or in the debt represented by it.

4. In
consideration of the premises, I so as to bind myself and my heirs,
executors, administrators, estates and effects/we so as to bind ourselves and
our heirs, executors, dministrators, estates and effects hereby agree and
undertake with you and your successors and assigns as under:-

i) to keep you safe and indemnified from time to time and at all times from and
against all claims, demand, actions, proceedings, loss, damages, liability
costs (legal costs being between Attorney/Advocate and clients), charges
and expenses whatsoever, which may be made or brought or commenced
against you or be paid, sustained, suffered or incurred by you howsoever
as consequence direct or indirect of your issuing to me/us duplicate Term
Deposit Receipt/s as aforesaid:

ii) to pay to you and make good on demand by you the amount of such loss,

461
 damage, liability, costs (legal costs being between Attorney/Advocate
and clients), charges and expenses together with the interest at
% p.a. with quarterly rests from the date of payment by you until
reimbursement by me/us;

iii) to return to you the original Term Deposit Receipt/s as aforesaid should
the same be received by me/us or should again come into my/our
possession, at any time hereafter.

Yours faithfully,

(Depositor/s)

(Not to be signed by any witness)

* In consideration of the premises, I/We the undersigned (jointly and severally)

guarantee to you, Bank of India, on demand by you, the due payment of all
moneys payable to you under the foregoing letter by the executants thereof.

1.Signature
Name:

Occupation:
Address :

2.Signature
Name:

Occupation:
Address :

(*To be obtained if sureties execute this letter).

(Not to be signed by any witness)

462
 APPENDIX V
(Paragraph 31.8)
INDEMNITY LETTER FOR ISSUE OF DUPLICATE TERM DEPOSIT
RECEIPT ISSUEDIN
LIEU OF EARNEST MONEY

To be stamped as an agreement PROVIDED SIGNATURES

ARE NOT WITNESSED

Name :

Address

:
Date

Bank of India,

Dear Sirs,

Re. : Term Deposit Receipt/s No./s. dated for Rs. _________________in

favour of

due on

We, the undersigned, Mr./M/s ................................. and ................................

(Name of the Government Department) respectively have entered into a

contract No……………..dated …………..for One of the terms of such contract
requires the undersigned No. 1 to obtain a Term Deposit Receipt from the Bank
in favour of the undersigned No. 2 Account(Name of the Depositor) to the extent
of Rs. for the purpose of

2. Pursuant
to the above requirement, I, the undersigned No. 1 had obtained
the Term Deposit Receipt from your Bank in favour of the undersigned No. 2
(Government Department) who has also executed these presents:-

3. Wewere until recently in possession of the abovementioned Term Deposit

Receipt/s issued by you in our favour.

463
4. Weregret to inform you that the abovementioned Deposit Receipt/s has/have
been either lost or misplaced and cannot be traced inspite of our having made
a due and diligent search for the same.

5. Weassure you that we have not created any right or interest in the said
Receipt/s or in the debt represented by it, in favour of any person whomsoever.

6. We have requested you to issue a duplicate Term Deposit Receipt/s in lieu of

the aforesaid receipt/s which has/have been lost.

7. Youhave agreed to accede to our above request on the faith and strength of
our above representations and assurances and on giving you the indemnities,
undertakings and authorities as hereinafter appearing.

8. Inconsideration of the premises, we so as to bind ourselves jointly and

severally and our heirs, executors, administrators, estates and effects jointly and
severally hereby agree and undertake with you and your successors and
assigns as under:-

to keep you safe and indemnified from time to time and at all times from and
i)
against all claims, demands, actions, proceedings, losses, damages, liabilities,
costs (legal costs being between Attorney/Advocate and clients), charges and
expenses whatsoever, which may be made or brought or commenced against
you or to be paid, sustained, suffered or incurred by you howsoever as
consequence, direct or indirect, of your issuing to us duplicate Term Deposit
Receipt/s as aforesaid;

ii) to pay to you and make good the amount of

such loss, damage, liability, costs
(legal costs being between Attorney/Advocate and client), charges and
expenses together with the interest at % p.a. rate of interest as an
unsecured advance from the date of payment by you until reimbursement by
us;

to return to you the original Term Deposit Receipt/s as aforesaid should it

iii)
be found by us or should it again come into our possession, at any time
hereafter.

Yours faithfully,

* In consideration of the premises, I/We the undersigned (jointly and severally)

guarantee to you, Bank of India, the payment of all moneys due under the
aforesaid presents by executants thereof.

464
1. Signature :
Name :

Occupation :
Address :

2. Signature :
Name :

Occupation :
Address :

465
 APPENDIX VI
(Paragraph 35.2)
Letter of Request to pay Amount of Term Deposit in cash
where the Aggregate Amount is less than Rs. 20,000/-

(Name and Address of the depositor)

Date :

The Manager,
Bank of India,

Branch _______________

Re.:Repayment of my/our
Term Deposit Receipt

No. dated

for Rs. __________________________________

in the name(s) of __________________________

on maturity/before maturity

1. I/We request you to pay the amount of the above term deposit in cash.
2. * I/We declare that I/We do not have any other term deposit/s with you in my
own name or jointly with another/others.
* I/We have kept other term deposits with you. I/We confirm that the aggregate
amount of such deposit/s receivable by me/us in my/our name/s or jointly with
another/others together with interest thereon is less than Rs.20,000/-.
Yours faithfully,
Signature of depositor/s)
* Strike out whichever is inapplicable.

466
 APPENDIX VII
(Paragraph 13.3)

Date :

BANK OF INDIA

Branch

Dear Sir,

My/Our/FDR/DBD/MIC/

Receipt No. ____________________________

Dated ________________________________

for Rs. ________________________________

due on
I / We hereby request you -

to renew the captioned receipt with/without interest on maturity, for a further

i)
period of ____________________ months/years.

ii) to
credit the proceeds of the receipt/interest on maturity to my/our Savings
Bank/ Current Deposit A/c.No. _________________________ with you/at your
Branch.

2. I/We
hereby lodge the receipt with you for safe-keeping to enable you to act on the
above instructions.

3. I/We undertake to return the safe-custody receipt/s to you for

amendments/cancellation.

Yours faithfully,

(Signature of Account holder/s)

467
 CHAPTER- 8: MONTHLY INCOME CERTIFICATES
1. Moneys invested in this type of deposit (Monthly Income Certificate) provide fixed
monthly income by way of interest to the depositor for a specified period leaving the
deposit amount intact. The Scheme will specially appeal to retired people who have no
pension. The monthly interest instalment should be credited to the savings or current
account or recurring deposit account of the depositor according to his instructions.

Introduction of Accounts

2. All Monthly Income Certificate accounts are required to be introduced/ KYC

complied. Introduction need not be insisted upon if the prospective account holder
maintains a current/introduced savings account. (For detailed instructions on
"Introduction", refer Chapter 2 on Deposits General).

Types of Accounts

3. The accounts may be opened in the names of:

(i) Individual — Single Accounts

(ii) Two or more individuals — Joint Accounts
(iii) Sole Proprietory Concerns
(iv) Partnership Firms
(v) Illiterate Persons
(vi) Blind Persons
(vii) Minors
(viii) Limited Companies
(ix) Associations, Clubs, Societies, etc.
(x) Trusts
(xi) Joint Hindu Families (accounts of non-trading nature only)
(xii) Municipalities
(xiii) Government and Quasi-Government Bodies
(xiv) Panchayats
(xv) Religious Institutions
(xvi) Educational Institutions (including Universities)
(xvii) Charitable Institutions

For detailed instructions for dealing with these accounts, refer Chapter 2 on
Deposits — General Opening of Accounts

4. To fall in line with the RBI’s guidelines on Know Your Customer (KYC) policy the
account opening form has been modified. The Branches are required to obtain the
468
revised latest account opening form while opening Savings Bank, Current Account, all
types of term deposits, BOI Savings Plus, BOI Current Plus, Overdraft and Cash Credit
account.

A new form is to be obtained at the time of opening of accounts for new customers.
And for opening an additional account in an existing account title, only additional
account opening form is to be obtained. For example, if A and B have earlier opened
Savings Bank Deposit Account where this new form has been obtained, in case they
desire to open a Term deposit account, the additional form need only to be obtained.
The new account opening form should be obtained in all existing accounts also in a
phased manner. The Account opening form has been annexed as APPENDIX XXVII
Chapter 2 – Deposits General.

The prospective depositor should fill in all the relevant particulars and complete in all
respects the Newly introduced/ KYC complied account opening form hereafter referred
to as the "card". The other particulars regarding account number, Customer ID ledger
folio, etc., should be completed by the Branch. The name of the account to which the
monthly interest amount is to be credited should be carefully noted on Account opening
form. The customer having Retail Internet transaction facility can open Online
TDR account through Internet Banking.

Amount to be invested

5.1 Minimum amount that may be accepted for deposits under the Monthly Income
Certificate Scheme shall be Rs. 10,000/- (Minimum per Receipt) for all category
branches and the amount above this can be accepted in the multiples of Rs. 100/-.

5.2 The monthly interest (discounted value) on deposits accepted as above is generally
paid in fractions. For example, on Rs. 6000/- accepted for a period of 12 months at the
rate of 8% p.a., monthly interest payable at discounted value amounts to Rs. 39.70.
However, where it is desired to receive interest in round amount, Branches are allowed
to accept deposits in fraction of Rs. 100/- and correspondingly pay interest in round
amount of Rs. 5/- or in multiples thereof. Branches should follow the interest table
shown in the finacle, showing the amounts of deposits for different periods which would
earn interest of Rs. 5/- or multiples thereof at different rates of interest. The interest
credited to the Account is rounded off after March’15 onwards.

Paying-in-Slips

6. Thedepositor(s) should fill in the paying-in-slip at the time of depositing moneys.

Care should be taken to see that the depositor has written all the relevant particulars
469
thereon, including instructions regarding repayment. It should be seen that the
instructions regarding repayment of the amount of the deposit on the card and on the
paying-in-slip tally. Also refer paragraph 8 of the Chapter on Fixed and Short Deposit
Accounts.

Interest

7. Rateof interest payable on Monthly Income Certificates is the same as that payable
on Term Deposits of equivalent periods. Head Office keeps Branches informed of the
rates of interest and changes therein from time to time.

Preparation and Issue of Monthly Income Certificate

8. Monthly Income Certificate (Form MIC 4) should be prepared from the card and the
paying-in-slip and issued only after ascertaining whether cash is received by the
Branch or cheque is realized. Instructions regarding disposal should be mentioned
clearly in red ink/ball-point pen on the Certificate and counterfoil under the initials of
the officer(s) signing the Certificate. (Instructions given in paragraph 11.1 and 11.5 to
11.10 of the Chapter on Fixed and Short Deposit Accounts also apply to Monthly
Income Certificates).
Presently, the Monthly Income Certificate (MIC) is printed through Finacle.
Calculation and Credit of Monthly Interest

9.1 Although in terms of the Reserve Bank of India directive, interest should be
calculated at quarterly or longer intervals (and not monthly), banks are allowed to pay
interest to the depositors on a monthly basis (as is done in the case of deposits under
Monthly Income Certificate Scheme), provided, however, that the amount of interest
paid every month is not more than the discounted value of interest for one month, so
that even if interest is allowed on the interest so paid, the aggregate amount (i.e. the
amount of interest paid monthly together with the interest that may accrue on the
amount so paid in one month) would not exceed one month's interest on the deposit
calculated on a quarterly basis.

Illustration: If an amount of Rs. 10,000/- is deposited for a period of 24 months or more,

yielding interest amount of Rs. 225/- per quarter (at 9% per annum, convertible
quarterly), the monthly instalment of interest would work out at Rs. 74.44 (recurring),
instead of Rs. 75/-.

9.2 There are two alternative ways in which a depositor may opt for interest on
deposits under Monthly Income Certificate Scheme as under:

I.A. depositor may receive interest every month at monthly discounted value as
explained in paragraph 9.1 above. Monthly instalment of interest at discounted value
470
will be paid according to the interest rates shown in Finacle. It is essential that the exact
amounts of interest as indicated in the table is paid for the respective amounts of
deposits and respective periods requested by the depositors; the figures of paisa
should not be rounded up or rounded down in any case.

Proportionate monthly instalment of interest will be credited to the specified account of

the depositor during the last week of the first month and thereafter full monthly
instalment of interest, as indicated in the table, will be credited during the last week of
every month. Proportionate interest on the basis of 30 days to a month would be
calculated in the following manner. If a deposit is accepted on the 7th of a month, first
instalment of interest will be calculated from 7th to the end of the month, that is, for 24
days (including 7th), irrespective of number of days in a month, and paid during the
last week of the 1st month and so also for the correspondingly proportionate period in
the last month i.e., 6 days in which Monthly Income Certificate is due for payment.

II. A. depositor may receive interest every quarter at actuals in which case the deposits
will, for all practical purposes, be treated as deposits under the Bank's Fixed Deposit
Scheme with an endorsement to the effect that the interest will be paid every quarter.
9.3 In terms of the Reserve Bank of India directive, Branches should not accept
deposits for a period longer than ten years subject to a maximum period of ten years
(Except Deposits as per Court Order, procedure explained in the Chapter 9).
Branches may accept deposits for any period in multiples of complete months or even
for a period where the terminal quarter/month is incomplete. To illustrate, deposits can
be accepted for 13 months, 37 months, 41 months, 38 months and 12 days, etc.
However, the payment of interest for the incomplete terminal quarter or terminal month
would be as follows:

i) Where the interest is paid at quarterly intervals during the currency of the
deposit, interest shall be paid at actuals at the contracted rate for the terminal
incomplete quarter at the maturity of the deposit.

ii) Where the interest is paid at discounted value on monthly basis during the
currency of the deposit—

a) If the terminal quarter consists of one month, interest therefor shall be paid
at actuals, i.e., 1/3 of quarterly interest; For example, if the deposit is for 37
months, the interest for the 37th month shall be paid at actuals i.e., 1/3 of
quarterly interest.

b) if the terminal incomplete quarter consists of —

i) one month and over but less than two month (e.g. If the deposit is for 37
months and 15 days), interest therefor shall be paid at discounted value for
471
 the first month (i.e. for the 37th month) and at actuals for the terminal
incomplete month;

ii) two months (e.g. if the deposit is for 38 months), interest therefor shall be
paid at discounted value for the first month (i.e. for the 37th month) and at
actuals for the second month;

iii) two months and over but less than three months (e.g. if the deposit is for
62 months and 15 days), interest therefore shall be paid at discounted
value for the first and second months (i.e. for the 61st and 62nd months)
and at actual for the terminal incomplete month.
9.4 Interest should be paid to the debit of Profit and Loss Account — Interest on
Monthly Income Certificate. As far as possible, once a month the total of interest on all
Monthly Income Certificates outstanding and due in a month should be worked out by
taking the total of the amounts entered in the column of monthly interest instalments
for that particular month from the Ledger-cum-Register and the amount of interest on
each Monthly Income Certificate account should then be disposed of according to the
instructions of the depositor.
The above method is explained to understand the ledger maintenance of MIC Interest.
Presently MIC interest is being credited to Savings/ Current/ Recurring Deposit etc.
accounts as per the instructions of the depositor by entering the respective Account
Number in to the Interest Credit Account ID field while opening MIC account in Finacle.

9.5 Interest on Monthly Income Certificate ceases on maturity.

The above LEDGER CUM REGISTER method is not followed. Presently MIC Ledger
and Register are generated in Finacle and no entering of interest is being done in
Finacle. System holds the information of the Ledger with Interest details.

Balancing

10.1 The principal amount of the Monthly Income Certificates should be balanced once
a month.Manual Balancing is discontinued. System is handling the Balancing Portion
in Finacle.
Presently Balancing is being done by system itself.

Payment and Renewal of Monthly Income Certificate

11. A Monthly Income Certificate may be paid or renewed on or after due date on
being surrendered, duly signed by the depositor(s) over a revenue stamp (in case of
cash payment) on the reverse. Instructions with regard to discharge and affixing of
revenue stamp, cancellation and payment scroll book for payment of Term Deposit
472
Receipts also apply to Monthly Income Certificates.

NOW AUTO RENEWAL IS DONE IN FINACLE

Repayment before Maturity

12. Sometimes depositors may request repayment of Monthly Income Certificates

before maturity. The Manager may sanction such repayments upto the limits
authorised by Head Office from time to time. The request should be made by all
depositors and all of them should discharge the Monthly Income Certificate irrespective
of the instructions regarding repayment. Payment of interest on a Monthly Income
Certificate to be repaid before maturity is governed by the Reserve Bank of India
directive issued from time to time. Where at the specific request of the depositors, the
Bank repays the principal amount of the deposit before maturity, interest repayable
shall be proportionately less (in accordance with the prevailing rules and Reserve Bank
of India directive) and the amount of excess interest, if any, already paid should be
recovered from the principal amount before payment and posted in red ink/ball-point-
pen in Profit and Loss Account-Interest on Monthly Income Certificate and adjusted.
Now, System takes care of recovery in the excess interest from Principle amount
of the Receipt.

Death of Monthly Income Certificate Account Holder

13. In the event of death of Monthly Income Certificate account holders, payment of
the amount of Monthly Income Certificate to the nominee, if appointed or to the legal
representative(s) will be made in accordance with the nomination rules and instructions
for payment of the balance of deceased account holders respectively. Refer Chapter
on Deposits — General and deceased depositors’ policy in this matter

Advances against Monthly Income Certificate

14. For detailed instructions regarding advances against Monthly Income Certificate,
refer to the Volume on Advances and circulars issued on the subject from time to time
by the Bank.

Other Instructions

15. The following instructions contained in the Chapter on Fixed & Short Deposit
Accounts are also applicable to Monthly Income Certificates:
Paragraph
Subject numbers of Fixed
& Short Deposit
(a) Custody of Undelivered Receipts 12
Accounts
473
 (b) Due Date Diary and advice of Maturity Date 13

(c) Overdue Deposit 22

(d) Payment and Renewal of Deposits before maturity 23
(e) Extension of period of deposit before maturity 24

Transfer of deposit before maturity from one Branch to

(t) 25
another

(Q) Payment or renewal of deposit at other Branches 26

(h) Notice of Assignment 27
(i) Deposit under Lien 29

0) Lost Deposit Receipt 31

(k) Brokerage 32
Payment of interest/principal Amount of Deposit —
(I) 34 & 3
Payment by crossed cheques etc. 5
(m) Verification of Stock of Deposit Receipt Books 36

(n) Custody of Deposit Receipt Books and Counter-foils 37

Also refer Chapter on Deposits — General

Combination of Monthly Income Certificate and Recurring Deposit

16. Amount of interest on Monthly Income Certificate which is credited to current or

savings accounts every month can also be credited to recurring deposit account in
the name of the depositors. Since, installment in a recurring deposit account has
to be Rs. 500/-or multiples thereof, the part of monthly interest amount in excess
of recurring deposit account installment can be credited to the depositor's current
or savings account. Where, however, monthly interest amount is less than the
amount of installment in recurring deposit account, the depositor may pay an
appropriate extra sum to make the amount equal to the exact recurring deposit
account installment which may then be credited to recurring deposit account.
Suitable standing instructions should be obtained from the depositors. Customer
having Retail Internet transaction facility can enter Standing Instructions for
the Recurring Account through Internet Banking.

474
16. Now, Customer having Retail Internet Banking (transaction) facility can open
the Monthly Income Certificate online and the deposits opened online can be
prematurely closed by the Customer through Internet Banking. Proceeds of the
same will be credited in T+1 days and an e-mail is sent to the registered e-mail
Id regarding this.

475
 CHAPTER- 9 DOUBLE BENEFIT DEPOSIT ACCOUNTS
Double Benefit Deposits provide a higher yield on the principal at the end of the
stipulated period as the interest is compounded on quarterly basis; but, the principal
and the accrued interest is paid only at the end of the period for which the deposit is
placed with the Bank and not monthly or half-yearly as in the case of other types of
deposits. This scheme is useful for short term, medium term and long term investment
ordinarily ranging from 6 months to 120 months.

Types of Accounts
2. The accounts may be opened in the names of:
(i) Individual — Single Accounts
(ii) Two or more individuals — Joint Accounts
(iii) Sole Proprietary Concerns
(iv) Partnership Firms
(v) Illiterate Persons
(vi) Blind Persons
(vii) Minors
(viii) Limited Companies
(ix) Associations, Clubs, Societies, etc.,
(x) Trusts
(xi) Joint Hindu Families (accounts of non-trading nature only)
(xii) Municipalities
(xiii) Government and Quasi-Government Bodies
(xiv) Panchayats
(xv) Religious Institutions
(xvi) Educational Institutions (including Universities)
(xvii) Charitable Institutions
For detailed instructions for dealing with these accounts, refer Chapter 2 on
Deposits — General

Opening of Accounts
3. As per RBI’s guidelines on Know Your Customer (KYC) policy the account opening
form has been modified. The Branches are required to obtain the latest account opening
form while opening Savings Bank, Current Account, all types of term deposits, BOI
Savings Plus, BOI Current Plus, Overdraft and Cash Credit account.

A new form along with KYC is to be obtained at the time of opening of new
accounts for new customers. For additional account, only additional account
opening form is to be obtained. For example, if A and B have earlier opened
476
 Savings Bank Deposit Account where this new form has been obtained, in case
they desire to open a Term deposit account, the additional form need only to be
obtained. The new account opening form should be obtained in all existing
accounts also in a phased manner. The Account opening form has been annexed
as APPENDIX I Chapter 2 – Deposits General.

The depositor should complete the Account Opening form as above in all respects
including instructions regarding payment of maturity proceeds. For detailed
instructions, refer Chapter 2 on Deposits — General.

When a DBD account is opened, we take instructions in the account opening form
regarding payment of maturity proceeds. Customer can choose to either (a) close
the account on maturity and credit the proceeds to their account or (b) renew the
principal amount and credit the interest amount on maturity or (c) auto renewal of
the deposit on the day of maturity (Default option). As per RBI guidelines, in case
the depositor has not furnished the specific details, the deposit shall be auto
renewed for the same period at the rate applicable on the date of auto renewal
including Term Deposit which are opened after obtaining of permission of HO-
Treasury. Also note that, deposits accepted with special rates, if any, shall not be
auto renewed. All the details should be entered in system properly. Upon renewal,
Customer may collect the renewed deposit receipt after submitting the matured
receipt duly discharged as per operational instruction.
The customer having Retail Internet Banking with Transaction facility can now
open the account through Internet Banking.

Period and Amount of Deposit

4.1 Deposits under Double Benefit Deposit Scheme are accepted for a fixed period
from six months up to a maximum period of 120 months. In case of court order the
deposits under the scheme can be accepted for more than 120 months. These
deposits, on maturity are repayable with interest compounded on quarterly basis.
These deposits may be accepted even for periods where the terminal quarter/half
year is incomplete. The incomplete quarter/half year of such deposits should be
reckoned at the end and for the incomplete quarter simple interest should be paid.

In case of court order the deposits under the scheme can be accepted for more
than 120 months. If the branch opens the TDR for the period more than 10 years
as per court order, the interest rate for the account will be the ROI applicable for
the 10 years.. The procedure for opening such TDR is as under:

 Term deposit may be prepared by the branch for the actual tenure as mentioned
in the Court Order, and the branch has to mandatorily enter the field “Spl Catgr.”
477
 as “C”.
 .
 The rate of interest eligible for these Term Deposit accounts shall be the rate of
interest applicable for ten years on the account open effective date.
 Modification in the account pertaining to the Rate of Interest shall be done by the
officials from Zonal Office authorized for it upon verification of the Court Order.

5. Deposits can be accepted for Rs. 10,000/- minimum per receipt in Metro, Urban,
Rural and Semi-Urban Branches. The following exceptions of minimum amount criteria
for term deposit receipts and where extant instructions to be followed:

i) Automatic Renewal
ii) Staff accounts
iii) Subsidy kept under Government sponsored schemes, Margin Money
Deposits, Earnest Money Deposits and Court attached/ordered deposits.

In case of automatic renewal, while it has been made as an exception from the
minimum size criteria, branches may advise the customers to build up their
deposit balance as per these new criteria.

6. At the time of depositing the amount, the depositor(s) should fill in relevant particulars
in the common paying-in-slip and sign against "BY". Instructions in regard to repayment
must be clearly mentioned. In absence of the clear instructions, the default option will
be applicable. The depositor(s) may change the option during the currency of the
deposit. However, the instructions will be applicable only on the maturity of the current
deposit. Branch should carefully enter all the details in the system. (Also refer paragraph
8 of the Chapter on Fixed and Short Deposit Accounts).

7. A cheque in favor of the account holder may be accepted for the credit of the account.
Double Benefit Deposit account should be opened after cheque realization. The clear
credit in the account shall be the date of account opening.

Preparation and Issue of Double Benefit Deposit Certificate

8. Double Benefit Deposit account should be opened as per account opening form. DBD
receipt will be printed after receiving of cash or authorization of transfer entry. "Maturity
Value" of the Double Benefit Deposit Certificate is the ultimate amount repayable at the
end of the stipulated period together with the interest compounded quarterly. The
applicable TDS shall be deducted from the accrued quarterly interest or from the
operative account as per the option given by the customer. Maturity value of the Term
deposit may differ, if the TDS is deducted from the Quarterly Accrued Interest on the
Term deposit (Instructions given in the Chapter on Fixed and Short Deposit Accounts
also apply to Double Benefit Deposit Accounts).
478
Double Benefit Deposit Ledger-cum-Register
9. Now, Branches can get all the details of the accounts from the report called “jotting”
through finacle.

Calculation and Application of Interest

10. The system takes care of calculation of interest. After application of interest the
print copy of the interest sheets should be checked, signed and preserved for future
use. The entries are as under -
*****SUNCR113INR INTEREST PAYABLE TD - IO TYPE
*****SUNCR003 INT PROVISION ON TERM DEPOSITS

The total amount of interest calculated will be credited to the individual TDR account of
the respective depositors to the debit of Profit and Loss account "Interest on Double
Benefit Deposits". In Finacle, the system takes care of calculation of interest. After
application of interest the print copy of the interest sheets should be checked, signed
and preserved for future use.

11. As per RBI guidelines, system rounds up the interest in individual TD accounts
to the nearest rupee.

12. Tax Deduction at Source

Bank deducts tax at source and remits to Income Tax Authorities as per the Income
Tax Act, 1961. Currently, the tax is applicable if the amount of interest credited or paid
during the financial year exceeds Rs. 40,000/- and Rs 50,000/ in case of Senior Citizens
on all deposits under one CIF No. The tax is deducted either from Term deposits’
proceeds or operative account as per the choice opted for by the customer. Bank shall
issue TDS certificate to the customer as per the extant guidelines of Income Tax
Authorities.

Balancing
13. The total principal amount of Double Benefit Deposits with interest accrued
thereon should agree with the balance in the General Ledger Account — Double Benefit
Deposits. Now, System takes care about balancing of GL Head.

Repayment and Renewal

14.1 On the due date depositor will discharge the Double Benefit Deposit Certificate
over revenue stamp (in case of cash payment) at the back of the Certificate. (Also refer
paragraph 18 of the Chapter on Fixed and Short Deposit Accounts).

14.2 The Certificate itself will serve as debit voucher for the principal amount and the
amount of interest due. Before repayment, it should be ascertained that Double Benefit
Deposit Certificate is not under lien of the Bank.
479
14.3 Double Benefit Deposit Certificate is not transferable by endorsement. In absence
of special instructions the amount can be paid to the depositor in person in accordance
with the repayment instructions. Payment to third-party must be authorized by a
separate authority letter duly signed by the depositor, accompanying the discharged
Double Benefit Deposit Certificate. The signature on the authority letter should be
verified and the person receiving the payment must be identified (KYC documents to
be obtained) before payment is made. In Case an undischarged Double Benefit Deposit
Certificate is received with a covering letter to renew the deposit, it may be renewed
after verifying the signature on the letter.

14.4 With effect from 15th March, 2002, all maturing Term deposits would be
automatically renewed for the same tenure (as the maturing deposit) at the rate of
interest applicable on the date of maturity. In case the depositor/s send an advance
(before the date of maturity) intimation, expressing a desire to renew the concerned
deposit for a shorter or longer period then deposit would be renewed according to the
desire of the depositor/s. For further details on renewal of deposits, please refer to
Chapter – 7 – Fixed & Short Deposits. As Per RBI instruction circular No. RBI/2021-
22/66, DoR.SPE.REC.29/13.03.00/2021-2022 m dated July 02, 2021, if a Term
Deposit (TD) matures and proceeds are unpaid, the amount left unclaimed with the
bank shall attract rate of interest as applicable to Saving account or the contracted
rate of interest on the matured TD, whichever is lower

14.5 System restricts branches to open TDR account value dated prior to 15 days.
Branches are unable to rectify the mistake committed inadvertently in account opening
/ renewal even in genuine cases,
i. If a TDR is being renewed for the period other than the customer’s mandated period.

ii. If
the account is of valuable nature and have bearing on business of the Branch
immediately or near future.
iii. There are rare occurrences where branch erroneously closes the receipt
prematurely citing operational issue without seeking the customer’s mandate/approval
and which may also give rise to customer complaints.
iv. There may be cases where Branch erroneously opens TDR in scheme
code other than customer’s request.

Procedure for account opening value dated prior to 15 days.

It has now been decided by the Top Management in the ALCO meeting to restrict any
value dating of TDR at branch level (HOBC-115/248 dated 16.11.2021). Value dating
of TDR shall be allowed at Zonal Office level with the specific approval of Zonal
Manager/ Zonal Manager In-Charge for any such deserving cases (as stipulated in
point no 6 of Br Cir 109/20 dated 07.04.2015).The procedure for opening value dated
TDRs at Zonal level remains unchanged.
480
Use menu OAACAU
Function –‘M’odify
Option – S
Modify the value date same as approved by Zonal Manager
Option – F to create flow with modified value date and commit
After completion of activity as mentioned above, branch has to verify the account.

Repayment before Maturity

15. A written request for closure of DBD account before maturity should be obtained
from all the account holders irrespective of the operational instruction given at the time
of opening the DBD account. The Double Benefit Deposit Certificate duly discharged
by ALL the depositors. Interest payable on deposits before maturity will be on a
compounded basis with quarterly rests for the period during which the deposit has
remained with the Bank. However, the interest rate payable on the term deposits
prematurely withdrawn will be the card rate, applicable at the time of acceptance of
deposits for the period of deposit actually run less penalty, if any.
Currently, penalty on premature withdrawal is:

Penalty applicable for premature withdrawal of Fresh/Renewed

Domestic/NRO/ NRE Rupee
Term Deposits w.e.f.01.04.2016 (Circular letter no.15-16/215 dt29.03.16)
Deposits less than Rs.5 Lakhs Deposits for ALL NRE
Rs. 5 Lakhs & Term
above Deposits- No
withdrawn interest
prematurely payable if
Withdrawn on or Withdrawn prematurely withdrawn
after completion before completion of before12
of 12 12 months(except Months
NRE Term Deposits)
NIL 0.50% 1.00%

NO SPLITTING OF DEPOSITS: Splitting of Deposits means Multiple Term Deposits

made on the same value date with Same Maturity Period in Single Customer Id
regardless of scheme code. Splitting of Term Deposits in such a way to result in
accommodation / undue benefit to the customer causing loss to the Bank would be
treated as a serious lapse on part of the concerned officials which may result in
examination of Staff Accountability / recovery of interest.
Please note the clause of taking, prior permission from Treasury Branch, by the
authorised Branch/Zone, for accepting deposit of Rs.10 Cr & above at given card
rates also (in any maturity bucket) both under Domestic and NRE Segments, is
481
continuing.
The matter regarding imposing of penalty in case of premature closure / withdrawal of
deposits (Term / Short term deposit) is decided by Bank from time to time, the
instruction of the Head office in this regard must be followed. However, currently
System takes care for calculation of interest and or penalty as applicable.

Branches may quote the Rate of Interest without Penalty clause for the deposits
offered by Government departments*. The deposits such accepted should fall under
the following Constitution Codes
11 - Central Government
12 - General State Government #
13 - State Govt. (Commercial Undertaking)
14 - Local & Quasi Government.
# - Branch Head and Manager Administration/In Charge of Deposits Department
will be Responsible for opening of such accounts.

* Please note the clause of taking, prior permission from Treasury Branch, by the
Branch/Zone, for accepting deposit of Rs.10 Cr & above at given card rates also (in
any maturity bucket) both under Domestic and NRE Segments, is continuing.
The auto renewal flag of all new deposits of Rs. 10 Crs & above has been disabled.
Branches are advised to invariably contact Treasury Branch, Head Office before
renewal of all such deposits
NO SPLITTING OF DEPOSITS: Splitting of Deposits means Multiple Term Deposits
made on the Same value date with Same Maturity Period in Single Customer Id
regardless of scheme code.

No interest will be paid for premature withdrawal below 7 days in case of Term Deposit
and below 3 months in case of RD. In case of NRE DBD, minimum period is 12
months. No interest is payable below 12 month for NRE DBD.

Branches should also follow the instructions given in paragraphs 23.1, 23.2, 23.4, 23.5
and 23.6 of Chapter 7 `Fixed and Short Deposit Accounts and Appendix I on Page
No. 8.

Extension of period of Deposit before Maturity

16. Extension of the period of Double Benefit Deposit before maturity is also
possible, as in the case of Fixed Deposits, without invoking the penal rate of interest
subject to the usual condition that the deposit is renewed for a period longer than the
remaining period of the original contract. Branches should follow the instructions given
in Chapter 7 of "Fixed and Short Deposit Accounts". Where the period of deposit is so
extended, the interest payable for the expired period of the existing deposit shall be
paid on a compounded basis with quarterly rests at the rate of interest applicable for
482
the period during which the deposit has remained with the Bank.

17. PREMATURE RENEWAL OF TERM DEPOSIT:

In case the depositor desires to renew the deposit by seeking premature closure of an
existing Term Deposit Account, the Bank will permit the renewal at the applicable rate
on the date of renewal, provided the deposit is renewed for a period longer than the
balance/un-run period of the original deposit.

Death of Double Benefit Deposit Account Holder

18. In the event of death of a joint account holder, amount of Double Benefit
Deposit will be paid in accordance with the instructions regarding repayment initially
given. If there are no instructions, payment will be made to the legal representative.
For detailed instructions, refer Chapter 2 on Deposits — General. The deceased
depositors’ policy also shall be applicable in case of deposits.

19. INTEREST PAYABLE ON TERM DEPOSIT IN DECEASED ACCOUNT--In the

event of death of the depositor before the date of maturity of the deposit and amount
of the deposit is claimed after the date of maturity, the Bank shall pay interest at the
contracted rate till the date of maturity. From the date of maturity to the date of
payment, the Bank shall pay simple term deposit interest at the applicable rate
prevailing on the date of maturity, for the period for which the deposit remained with
the Bank, beyond the date of maturity as per the Bank's policy in this regard.
However, in the case of death of the depositor after the date of maturity of the Deposit
and where the deposits is not renewed automatically, the amount of maturity value of
deposit shall attract rate of interest as applicable to savings account or the contracted
rate of interest on the matured TD, whichever is lower.

Advance against Double Benefit Deposits

20. For detailed instructions regarding advances against Double Benefit Deposit, refer
to the Volume on Advances and circulars issued on the subject from time to time by
the Bank. (New circular no-114/240 dated 28.01.2021)

Credit Card against Double Benefit Deposits

For detailed instructions regarding Credit Card against Double Benefit Deposit, refer
to the Volume on Card Product – Credit Card and circulars issued on the subject from
time to time by the Bank. (Circular no-115/324 dated 24.03.2022 5.4)

Other Instructions
21. The following instructions contained in the Chapter on Fixed and Short Deposit
Accounts are also applicable to Double Benefit Deposits:
483
 Paragraph,
Subject numbers of chapter
on fixed & short
(a) Overdue Deposit 22.1
deposit accounts
Repayment before maturity in the case of a Joint
(b) 23.6
Account where one of the account holders is deceased

(c) Transfer of deposit before maturity from one Branch to 25.1

another
(d) Payment or renewal of deposit at other Branches 26

(e) Notice of Assignment 27.1

(f) Deposit under Lien 29

(g) Lost Deposit Receipt 31.1

(h) Brokerage 32

(i) Verification of Stock of Deposit Certificate Books 36

Also refer Chapter on Deposits — General.

484
 CHAPTER- 10 RECURRING DEPOSIT ACCOUNTS

1. Recurring Deposit is a special type of deposit account which enables a depositor

particularly in fixed income group to save by paying into the account an agreed fixed
sum of money monthly over a stipulated period. The deposits in this type of account
earn compound interest on quarterly basis. Longer the period for which monthly
deposits are agreed to be made higher is the rate of interest subject to rules.

Introduction of Accounts

2. AllRecurring Deposit accounts are required to be KYC compliant. KYC need not be
insisted upon if the prospective account holder’s Cust ID is KYC compliant and it is not
due on the date of opening of new / additional account. (For detailed instructions on
"Introduction", refer Chapter on Deposits — General).

Types of Accounts

3. As
the Recurring Deposit Scheme is designed as an alternative to mutual funds
whereby periodical payments can be made for receiving lumpsump amount on
maturity.

For detailed instructions, for dealing with these accounts, please refer to the Chapter
2 on Deposits — General

Opening of Accounts

4.1 To fall in line with the RBI’s guidelines on Know Your Customer (KYC) policy the
account opening form has been modified. The Branches are required to obtain the
latest account opening form while opening Savings Bank, Current Account, all types of
term deposits, BOI Savings Plus, BOI Current Plus, Overdraft and Cash Credit
account.

A new form is to be obtained at the time of opening of accounts for new customers and
for opening an additional account in an existing CustId, only additional account opening
form is to be obtained. For example, if A and B have earlier opened Savings Bank
Deposit Account where this new form has been obtained, incase they desire to open a
Term deposit account, the additional form need only to be obtained. The new account
opening form should be obtained in all existing accounts also in a phased manner. The
Account opening form has been annexed as APPENDIX XXVII Chapter 2 – Deposits
General. The name of the depositor should match with the KYC documents submitted
for opening of the deposit account.
485
When a prospective customer desires to open a Recurring Deposit account, he should
be requested to fill in the application form as above. All the details should be entered
in system properly. The customer having Retail Internet Banking with transaction
facility can now open Online RD account.

4.2 A Recurring Deposit account where the compounding of interest is to be done on

quarterly basis shall be accepted for periods in multiples of three months only upto the
maximum period of ten years. If large sums of deposits are offered for periods over
120 months, Branches should make a prompt reference to Head Office.

4.3 Recurring Deposits will be in equal monthly installments. Minimum monthly

installment is raised to Rs.500/-

Paying-in-Slips

5. Presently a common paying-in-slip, for all type of accounts, has been introduced.

Deposit of Monthly Instalments

6.1 Cheques drawn in favor of the account holder may be accepted if he maintains a
KYC compliant current account or savings account at the Branch. Instalment for any
calendar month must be paid on or before the last working day of that month. No
penalty os to be paid for missed instalments.

6.2 At the request of a depositor, installments may be deposited free of charge by one
Branch to another Branch where the depositor maintains his Recurring Deposit
account. Standing instructions of the depositors to transfer the amounts of monthly
instalments from the current/savings accounts to their Recurring Deposit accounts may
be accepted free of charge. Should the balance in the account be insufficient to make
the transfer, the standing instructions may be treated as cancelled under advice to the
depositor.

6.3 In the case of defaults in the payment of instalments, the depositor may either:

a) Regularize the account by paying the defaulted instalments

b) Continue the account till maturity without regularizing it in which case simple
interest shall be paid at the applicable rate for the entire period.

Acceptance of Annual Instalments

7.1 Branches can also accept annual instalments under the Recurring Deposit
Scheme. This would suit the requirements of corporate bodies, societies, etc., who
may desire to create or invest funds for specific purposes such as Sinking Fund,
Gratuity Fund, Pension Fund, etc
486
7.2 The minimum number of annual instalments will be 5 and the maximum number of
annual instalments will be 9. The amount of annual instalment should be minimum Rs.
500/- or in exact multiple thereof. All other terms and conditions as applicable to
Recurring Deposit Accounts with monthly instalments are also applicable to Recurring
Deposit Accounts with annual instalments.

Opening of Accounts in the System

8.1 All the particulars of accounts, such as Customer ID, full names of account holders,
special instructions, if any, for repayment of the balance, address, number and amount
of instalments, rate of interest etc should be entered in the system properly by the
Branch.

8.2 If on a rare occasion, a cheque for the amount of an instalment deposited into the
account is returned unpaid, a debit entry would be necessary.

KYC requirements
9. The KYC requirements as per the category must be ensured especially with respect
to Beneficial Owners while opening the account. Branch is to be guided by the CKYC
procedure at the time of opening the account as advised by Head Office, time to time
(available in Star Desk). In case CKYC ID is provided by the individual customer, the
original KYC documents may not be insisted. Instead a copy of the documents entered
under the CKYC Id should be kept for the Branch record.

Recurring Deposit Pass Books

10.1 Every Recurring Deposit account holder should be supplied with a Recurring
Deposit Pass Book (Form RD 6).

All the particulars, such as Customer ID, the name of the account holder, address,
account number, the number of instalments, etc., should be filled in at the appropriate
place on the cover page and the inside page of the pass book. Every entry in the pass
book must be verified and authenticated by an officer under his initials (in Finacle
system environment, pass book is being printed by printer & hence initials are not
required). The summation of debit and credit columns in the pass book should be
taken.

The date on which the last Instalment falls due should be written on the first page of
the R/D Pass Book below the space provided for writing the maturity value.

10.2 As pass books of recurring deposit accounts are printed without the Rules, a
separate printed copy of the Rules is given to the account holders at the time of opening
of the account who are required to sign it. A printed copy of the Rules duly signed by
487
the account holder should be properly filed in a separate box file after writing
prominently the account number at the top of it on the right hand side for easy reference.
An extra copy of the Rules may be supplied to the account holder, if so desired.

10.3 No instalment can ordinarily be paid into and no repayment can ordinarily
be made from an account without production of the pass book. If the pass book
is mutilated/spoiled/lost, charges at the rate prevalent at the relevant time should
be made for a fresh pass book. In case the RD is opened through Retail Internet
Banking, the insistence of passbook may not be made, instead customer may
produce the statement of account.

Calculation and Application of Interest

12.1 Rates of interest applicable to Recurring Deposits are that of the Domestic
Rupee Term Deposits for the relevant period & amount and are liable to change
from time to time.

12.2 The products for a month would be the balance (full rupee amount only) of
the account at the end of the previous month. Since compounding of interest is
done on quarterly basis, System will calculate interest on the basis of quarterly
compounding but apply interest every six months in September & March.

Presently Finacle system takes care of all these procedures.

12.3 If any instalment in arrears is paid at a later date, interest on the amount of
arrears of instalments should be calculated for the month/s for which the
instalment was in arrears at a rate specified in paragraph 6 above.

Currently, system takes care of instalments paid in advance if any.

12.4 Interest on Recurring Deposits accrues half yearly and comes for
assessment on annual basis. In case a depositor requests for a certificate of
interest accrued on the Recurring Deposit, it may be issued to him for the relevant
financial year. However, it should be made clear to the account holder that the
interest accrued on Recurring Deposit will actually be paid to the depositor only
on maturity. The interest accrual shall be subject to deduction of TDS at the rate
specified as per extant guidelines of Income Tax Act, 1961

Due Date Diary and Advice of Maturity Date

13. Instructions given in the Chapter on "Fixed & Short Deposits Accounts" on
maintenance of Due Date Diary and advising of maturity dates to depositors are
also applicable to Recurring Deposit Accounts. Since it is possible to fix date of
maturity on payment of last instalment of a Recurring Deposit Account, Branches
488
may send the Maturity Date Advices to Recurring Deposit Account holders on
payment of last instalment. Accordingly, Due Date Diary can be maintained once
the due date for repayment of a Recurring Deposit Account is known.

Repayment of Recurring Deposit

14. The total amount repayable to a depositor inclusive of interest depends on

the amount of monthly instalments and the period for which it is invested. When
all the instalments stipulated by the depositor are paid, the accumulated
amount will be repayable together with accrued interest 30 days after the
last instalment has become payable and has been paid, or the date of
maturity whichever date may have fallen later. For this purpose, the "date of
maturity" is that date corresponding to the date of opening of the account and
falling in the month subsequent to the month for which the last instalment is due.

The examples of the due dates for repayment of deposits of accounts in which
the last instalment is deposited on different dates are given in the following Table.
Date a/c No of Date of Date of Due date Remarks
opened instalm last maturity of
a)7.5.2005 ents instalme 7.5.2006 7.5.2006
12 1.4.2006 repayme Last instalment paid in
stipul nt nt the month it is
ated Due but before the
date
corresponding to
account opening
date.

b)1.3.2004 24 20.2.2006 1.3.2006 20.3.2006 Last instalment paid in

the month it is due but
after the date
corresponding to
account opening date.
c) 20.12.2004 12 14.10.200 20.12.20 20.12.200 Last instalment paid in
5 05 5 earlier month than the
month in which it is due
d)17.5.2003 36 . 17.5.200 10.8.2006 Last instalment paid
10.7.200 6 in after the
6 month in which it is due.

489
Repayment of Recurring Deposit before Maturity

15.1 Sometimes depositors may request repayment of their deposits before all the
stipulated instalments are paid. Branches should follow directives by the Bank, in the
matter of premature withdrawal of deposits issued from time to time.

15.2 Interest amount every half-year has been calculated on monthly products and
provided for and debited to Profit and Loss Account — Interest on Recurring Deposits on
the footing that the monthly instalments will be paid regularly during the stipulated period.
The normal rate of interest on Recurring Deposit is higher than the rate of interest payable
to a depositor requesting repayment of deposit before maturity. The difference between
the interest at normal rate of interest and the actual interest payable will be credited to
Profit and Loss Account — Interest on Recurring Deposits. Currently, it is being taken care
by the system.

15.3 In the case of premature closure of a Recurring Deposit account within three months
of its opening no interest should be paid.

15.4 In other cases where the sole depositor or all joint depositors or all survivors of them
wish to discontinue the account before all the stipulated instalments are paid, the amount
of the instalments already paid will be repayable together with compound interest on
monthly products at a rate of interest applicable to the period for which the deposit has
remained with the Bank along with penalty, if any subject to the directive of the Bank in
this regard for Term Deposits.

Payment of Balance of Deceased Account Holders

16. If a depositor or surviving depositor or the last surviving depositor dies before the
stipulated instalments are paid, the account will be discontinued and the balance of
instalments in the account will be repayable to the legal heirs of the deceased with interest
as under:

(a) if deposit has run for less than 12 months, at the rate stipulated by Bank on
repayment of Term Deposits from time to time,

(b) if deposit has run for a period of 12 months or more but less than the contractual
period, at the rate applicable for the period for which the deposit has remained with
the Bank from the date of opening the account to the date of repayment,

(c) if the deposit has run for the contractual period or more, at the rate applicable for
contractual period.

But, under no circumstances, the interest will be payable beyond stipulated contractual
period for a particular Recurring Deposit account. For other detailed instructions, refer

490
Chapter on Deposits — General.
In finacle, system convert the matured Recurring Deposit amount in to DBD for six
months.

Nomination
17. Nomination is available for Recurring Deposits. Branch should refer to the Standard
Nomination Rules in this regard.

Advances against Recurring Deposits

18. For detailed instructions regarding advances against Recurring Deposit, refer to the
Volume on Advances and circulars issued on the subject from time to time by the Bank.

Transfer of Account from One Branch to Another

19. Depositors of Recurring Deposit Accounts are allowed to transfer the balances at any
time before maturity as deposits repayable on the expiry of a fixed term with interest on
a compounded basis at the rate applicable for the period during which the deposit has
remained with the Bank, without any penalty.

I. Procedure at Transferor Branch

i) A letter requesting the Branch to transfer the account to another specified Branch of
Bank should be obtained along with the related pass book. This letter should be signed
by ALL the depositors in the case of joint accounts irrespective of the mode of operations
specified in the account and the signatures verified by two officers where more than two
officers are working in a Branch or by an authorised official, where only one officer is
available.
ii) A fresh specimen signature card (Form RDI) duly completed and signed by ALL the
depositors in case of a joint account should be obtained for the use of the transferee
Branch. The operational instructions on the fresh card and the order in which the names
are entered thereon (in case of joint accounts) should be exactly the same as those in
the existing account. All the signatures and operational instructions on the fresh card
should be verified in the same manner as stated in (i) above under a rubber stamp
reading "signatures verified". Full signatures of the officer/officers authorised to sign on
behalf of the Branch will be required.

Following documents should be sent to the transferee branch along with the request
letter.

(a) The fresh specimen signature card (Form RDI) — item (ii) above.

(b) Pass Book of the transferred account written up to date and duly ruled off with
remarks as stated under (i) above.
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 (c) Statement of accounts. (This should be an exact copy of the ledger account. It
should show the rate of interest allowed in the account, interest amount
recoverable on instalment in arrears, products upto the month of transfer from
the previous quarter, etc.).
iii) Interest should be calculated quarterly and credited to the account up to previous
quarter of the month of transfer by debiting Profit and Loss account — Interest on
Recurring Deposits. The subsequent products of each month up to the month of transfer
should be advised to transferee Branch to enable them to pay interest.

iv) Interest to be charged on the instalments in arrears (i.e. not received within the
prescribed period), if any, should be calculated at the prescribed rate and the total
interest amount recoverable should be worked out. It should not, however, be charged
to the account. (The transferee Branch would recover such interest at the time of
repayment. For this purpose, the interest amount should be advised to the transferee
Branch in the statement of account — item vi(c) below).

v) The account should be closed and the balance in the account transferred to the
specified transferee Branch by means of a Credit Authorization Note (Form BR 668 B),
showing separately the total instalment amount and total interest amount. A remark "At
the request of the depositor(s), the account is transferred to
Branch" should be made on the ledger folio.
Now in finacle it can be transferred directly to the transferee Branch in menu ACXFRSOL
with the same account number .

vi) The Credit Authorization Note should be sent to the transferee Branch together with
the following:

(a) The fresh specimen signature card (Form RDI) — item (ii) above.

(b) Pass Book of the transferred account written up to date and duly ruled off with
remarks as stated under (v) above.

(c) Statement of accounts. (This should be an exact copy of the ledger account. It
should show the rate of interest allowed in the account, interest amount
recoverable on instalment in arrears, products upto the month of transfer from
the previous quarter, etc.).

vii) The letter of request for transfer should be attached to the debit voucher prepared for
closing the account.

viii) If the depositor has given any standing instructions in respect of crediting instalments
for the Recurring Deposit account, these may be cancelled under approval of the
depositor.

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ix) Other procedure connected with closing of a Recurring Deposit account should be
followed as usual.

II. Procedure at Transferee Branch

i) A new pass book for the account should be prepared as usual. A remark "The Account
is transferred from our Branch" should be made on the inside first page of the pass
book. The first entry to be made in the pass book should be on the printed line relating
to the latest month for which the instalment has been deposited at the transferor
Branch, with the noting,
"By Amount Transferred from Branch." Only the total of instalments already paid in at the
transferor Branch (i.e. exclusive of interest) should be entered in the "Credit
(instalments)" and "Credit Balance (instalments)" columns. The space in the pass book
page(s) pertaining to the previous instalments deposited at the transferor Branch should
be neatly ruled across.

ii) The pass book of the new account together with the pass book of the account of
transferor branch should be sent to the depositor.

iii) Standing instructions in regard to payment of further instalments may be

obtained from the depositor, if required.

iv) The Statement of Account received from the transferor Branch should be filed carefully
for reference etc.

Presently in Finacle environment, provision of “Account Number Portability” has been

introduced and hence there is no need to open another Account or pass any voucher
separately. Accounts are being transferred through system with the help of Menu / Data
Centre. Requisite documents must be taken and preserved by both, the Transferor and
Transferee Branches.

Closing of Account

20.1 The Bank reserves the right to close the account in which monthly instalments are not
regularly paid. In such event, the amount of the instalments already paid will be repayable
together with simple interest.

20.2 If an account is closed within 12 months of its opening, charge at the rate prevalent
at the relevant time should be made.

Star Flexi Recurring Deposits

21. This unique Recurring deposit scheme offers flexibility to the customer to invest
surplus fund on monthly basis and allows choosing core installment and monthly flexi
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installments.

Some of the features of the Scheme are as under –

i) Core Installments (Fixed rate) - As applicable for the period for which account has
been opened.
ii) Flexi Installments- As applicable for the period of RD remains with the Bank i.e.
from the date of deposit of each flexi installment till maturity of RD account.
iii) Maturity value will be calculated by the System, depending on the amount of Flexi
Installments. No fixed maturity value.
iv) There will be one maturity date for care and flexi installments.
v) Core and Flexi Installments need not be deposited together, they can be deposited
at different dates in the same month.
vi) No pass book will be issued for Flexi RD account. Only System generated
Statements will be issued to the customers.
v) No Flexi installment will be accepted in the last month of R/D account, i.e. If RD
account is opened for 36 months, Flexi installments can be deposited from 1st to
35th month.
vi) No auto-renewal of maturity proceeds permitted. Instead the proceeds will be
credited to SB account, if no other instructions are received from the customer.
For this purpose, an operative SB or CD account may be opened for the customer
while opening the Flexi RD Account.
vii) All other Terms & conditions are as applicable to the Normal RD Accounts.

Other Instructions

21. The following instructions contained in the Chapter on Fixed and Short Deposits
Accounts are also applicable to Recurring Deposit accounts.

Subject Paragraph numbers of Chapter on Fixed & Short

Deposits Accounts
(a) Overdue Deposit 22.1
(b) Payment of Deposit at other Branches 26

(c) Assignment of deposit 27

(d) Deposit under Lien 29
(e) Payment of Interest/Principal Amount of 34, 35
Deposit-payment by crossed cheques,
etc
Also refer chapter on Deposits – General
21.2 Requests of customers to give retrospective effect as of the date of maturity for
reinvestment of proceeds of the overdue Recurring Deposit Accounts in other modes of
Term Deposits can be acceded to, subject to compliance of instructions laid down in
para 22.1 and 22.2 of Chapter-7 on Fixed and Short Deposits Accounts.
Overdue Recurring Deposits

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23. All overdue RD A/cs should be renewed as DBD with maturity value of RD for the
same tenure as the maturing RD with applicable interest on the date of maturity of the
RD. The a/c opening card of the maturing RD account would be used for the renewed
DBD receipt after due notings on the card.Other instructions relating to overdue deposits
as per instructions in chapter 7 – Fixed & Deposit Accounts apply to RD a/cs also.

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 CHAPTER- 11
CASH AND CLEARING

1. Custody of cash: Dual Control

1.1 Cash held in Branch safe or strong room should always be under the dual control
of the Manager / Designated Officer and the cashier of the Branch, even during working
hours. The cash safe/strong room should be locked by the two officials, so that no one
official singly can open the cash safe/strong room.

1.2 When cash safe/strong room is opened in the morning, the cashier should take out
cash sufficient for the requirements during the day. The balance of cash should remain
in the safe / strong room under dual control, as stated above.

1.3 The cashier should maintain a pass book to keep a record of cash taken out in the
morning and kept back in the evening. (A specimen of the pass book with the required
columns is given in Appendix I). If further cash is required to be taken out during the
day, appropriate entries must be made in the pass book. This pass book should remain
in the Branch cash safe/strong room. The Manager should check, from the entries in
the pass book, the cash taken out and kept back. (The amount of cash kept back in
the safe at the end of the day together with the cash already in the safe must agree
with the balance of cash on hand at the close of business of the day). The Manager /
Designated Officer must also sign the Daily Cash Balance Book (Form Cash 1075) at
the end of the day after the Branch cashier has signed it. This is necessary to evidence
the dual control over cash in the Till/Vault.

1.4 Managers of Small and Medium Branches should hold one set of keys relating to
cash safes/securities safes. The other set of keys should be held by the cashier/senior
most second officer in case of Small Branches and by Cashier/Assistant Manager
(administration) in case of Medium Branches.

1.5 In case, due to business considerations, if any of the Branch Managers of Medium
Branches requests for relief from the responsibility of carrying/holding these keys, the
same may be considered and authorized by the Zonal Manager, on merits of the case.
While approving such cases, the authorities concerned should specifically advise the
Branch regarding the officers who would carry these keys in that Branch.

1.6 In case of Large, Very Large and Exceptionally Large Branches, the Managers/Chief
Managers be relieved of the responsibility of carrying the keys of cash and security
safes. The two sets of keys should be held/carried, at these Branches, by the following
authorities, according to the type of safes provided at the Branches:

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A. For types of safes with two sets of keys:
Keys of To be held by
Cash safes First Key At Very/ Exceptionally Large Branch
Senior Manager / Chief Manager
(Administration & services)

At Large Branch
Manager (Administration & services)
Second Key Cashier
First Key At Very/ Exceptionally Large Branch
Senior Manager/ Chief Manager
Security (Administration & services)
safes At Large Branch
Manager (Administration & services)
Second Key At Very/ Exceptionally Large Branch
Senior Manager/ Chief Manager
(Administration & services)
At Large Branch
Manager (Credit)

B. For types of safes where a master-key is provided additionally:

Keys of To be held by
Master Key At Very/ Exceptionally Large Branch
Senior Manager / Chief Manager
(Administration & services)
Cash safe At Large Branch
Manager (Administration & Services)
Keys A & B Cashier
Master Key At Very/ Exceptionally Large Branch
Senior Manager / Chief Manager
(Administration & services)
At Large Branch
Security safes Manager (Administration & Services)
Keys A & B At Very/ Exceptionally Large Branch
Senior Manager / Chief Manager (Credit)
At Large Branch
Manager (Credit)

1.7 Notwithstanding the above, the Branch Manager at his discretion may entrust the
keys to other next senior officers of the Branch for temporary periods, during the
leave/absence of duty/deputation of the designated officers concerned, without
compromising on the principle of dual/control requirements.
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2. Daily Lodgment of Cash in the Till/Vault

2.1 The Joint Custodian of cash (i.e. Branch Manager/Senior / Chief Manager as the
case may be) should check the cash every time before depositing the same in the Till /
Vault. The procedure for such checking, at the minimum, should cover:

(a) detailed piece by piece count of all notes of higher denominations, viz. Rs.
100/- and above (if in circulation), however, in the case of Rs. 100/-
denomination notes, if there are more than 2 bundles, first the number of
bundles and then packets in each bundle should be counted (a bundle
contains 10 packets each of 100 currency notes); thereafter, a detailed piece
by piece count of a sample lot of at least 25% of the total number of packets
of Rs. 100/- denominations notes should be made.

(b) After checking the total number of bundles and the number of packets in each
bundle, a sample count of notes of lower denominations by the "clip" system.
The Joint Custodian should use his discretion as to the number of sample
packets to be checked on clip system basis. (The clip system is explained in
the Note below).

(c) Piece by piece count of all loose currency notes.

(d) Sample check of Rupee coins and small coins. The Joint Custodian may use
his discretion as to the extent of such sample check.

Note: Under the "clip" system, the checking officer (i.e. the Joint Custodian) clips a
certain portion of the notes from the selected packet and asks an officer/cashier other
than the cashier-in-charge to count in his presence the pieces "unclipped". Thereafter,
the checking officer counts the pieces in the clipped portion and verifies that the total
number of pieces counted by himself and the other cashier/officer amounts to 100
pieces.

3. Change of Cashier

3.1 The incoming cashier should take complete charge of the Branch cash and satisfy
himself that the balance of cash in hand tallies with the balance in the Daily Cash
Balance Book. What method of taking charge of entire cash he should adopt is purely a
subjective matter but he should at least undertake the minimum checks as indicated

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in paragraphs 2 and 40 with due circumspection and satisfy himself regarding
correctness of the cash on hand.

4. Safety of Cash within the Bank

4.1 Design of cash cabins should be based on following broad principles:-

a) Cash cabin must provide reasonable security to both the cashiers and cash from
hostile environment, so that the cash staff is able to protect the cash in their
possession and can be solely accountable for it.

b) Cash cabins should block visibility of cash from customer aisles while ensuring
that a customer is able to see his cash being counted / processed.

c) Cash cabins must not be visible from outside the branch premises. At the same
time, visibility of other work stations should be maximized.

d) Mechanization of cash dispensing must not compromise the security of cash and
staff.

e) Entry to cash enclosure should be such that no one should be able to enter
without being noticed.

f) Wherever necessary, cashier's cash drawers may be replaced by a "drawer-safe"

device wherein cash kept in the drawer automatically drops into safe below the
drawer when the drawer is pushed in.

g) Entrance doors should have locks which cannot be opened from outside.

h) Cash cabins should be enclosed by a common passage at the rear.

i) Visibility of cash processing area from customer aisles must be blocked.

j) Cash cabins must be enclosed by see-through partition walls. Thick glass plate
or decorative aluminum grilles may be used for the purpose. However, the front
side of the cash cabin should have thick glass only. It must be ensured that
registers and other books/records are not piled against the partition, thereby
obstructing the view.

k) The cash cabin doors must be fitted with night latches, so that once closed from
within, they cannot be opened from outside without operating the key. This should
be equally applied to the Teller cabin as well as to the door of the cash department.

l) The cashier's cabin should have a very small opening (tray-type) not exceeding
5 cm in height and as far away as possible from the door latch at the rear, so that
cheques, registers, etc. can be passed through it without opening from outside.

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 m) All windows of the cash counters should be provided with sliding flaps which
cannot be opened from outside.

n) The breadth of the work-table on the cashier's side of the counter should
likewise be such that a person standing outside cannot reach the cash drawer
level.

o) The cash drawers should have appropriate locking arrangements.

p) A thick transparent glass of at least 6" width should be provided at upper

work table to facilitate customer to view his cash being counted.

q) The height of the cash cabin should be adequate to prevent a person standing
outside from reaching the counter level.

r) The cash windows to provide space just for a hand to pass through.

s) The Cash counter should have work tables at two levels, the first should be of
the same level as the counter on the customer’s side and the second at a lower
level where drawers for keeping cash will be fitted on the cashier’s side

4.2 As and when there is a change in layout of a branch, either due to the layout
being defective or not meeting the security norms, the Security Officer of the Zone
must be consulted.

4.3 The Branch Manager/ Manager should have a clear view of Cash Department; it
should not be obscured by cabinets or safes.

4.4 The work of removing cash from the strong room should be undertaken 15
minutes before the actual start of business hours. This has three-fold advantages:

(a) The cash could be removed from the strong room when the customers are
not expected and when the gates are closed.

(b) The absenteeism will be known so that alternative arrangements can be

made.

(c) Prompt service will be available to the customers at the start of business
hours.

During business hours, cash must be taken out of the strong room on a minimum
number of occasions, if necessary.

4.5 The doors of the Branch should be closed and locked from inside when the cash is
taken out of the strong room to the counters in the cash department and similarly when

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the cash is brought back from the counters to the strong room. Where an armed
guard/watchman is posted, he should escort such cash in transit. The paying cashier
must accompany the cash box duly locked from cash safe to his cabin and vice versa.

4.6 Cash taken out from the cash safe should be just sufficient to meet the daily
requirements and it should not exceed the amount prescribed. The minimum quantum
of cash should be taken out of the safe every day depending upon the average
payments/receipts.

4.7 Cashiers' cabins should be properly covered and provided with an automatic lock.
Doors of the cash cabins should remain locked at all times. Cashiers should keep the
cash in the drawers of their counters or in steel boxes fixed to the counters. If cash is
kept in the drawers, they should be provided with locks which close automatically
when they are pushed in. If cash is kept in steel boxes near the counter, they should
be chained securely (with an iron chain) either to the railing or to the leg of the
counter. The steel boxes should be provided with a locking device so that when the
box is closed, it is automatically locked.

4.8 As a strict precautionary measure, an unknown person should not be allowed to

loiter around, particularly behind the counter or the cashier's cage, without proper
enquiries/interrogation and that no access to important instruments and documents is
given to any unauthorized person. The receiving/paying cashier should invariably keep
the door(s) of the cash cage(s) locked, when cash transactions are being handled. It
is also necessary that the cashiers should not indulge in conversation with unknown
person(s), as someone else or companion of unknown person may have an opportunity
to whisk away currency notes without the notice of the cashier. Utmost vigilance,
therefore, should be kept by all the staff members concerned. Further, entry of
customers in Cash area should not be allowed.

4.9 Branches should close shutters/grille gates immediately at the close of banking
hours every day. Visitors to the Bank after business hours should be closely screened
and let in selectively after they are properly identified. There should only be one exit-
cum-entry door in the Branch and it should be provided with collapsible gate/rolling
shutters. Wherever possible, the closure of the door by the application of button or
similar system should also be considered especially in the Metropolitan Branches. The
collapsible grill gate at the main entrance to the branch must be so chained so that
entry and exit is restricted to one person at a time.

4.10 Alarm system in branches must always be kept in working order and it must be
ensured that they are being properly serviced by the authorized vendor as per contract
terms. Alarm switches must be installed at a few important places viz., Manager's
cabin, cash cabins, strong room, stationery room, toilet and near the armed guard
where posted and speakers of the alarm system in a branch should be located in a
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manner, so that it is hidden from public view and not easily accessible.

5. Bait Money

5.1 The use of Bait Money is a measure of passive resistance and is highly effective as
a counter offensive against dacoits/robbers. Bait money is also known as trap money,
decoy money, or the robbers pack. It is prepared in advance of an attempt of robbery
at the branch premises or while cash is in transit. It does not require physical action,
that might be suspicious or objectionable to desperadoes and it is not self-revealing as
bandits cannot recognize bait money. Hence, as a measure of passive resistance bait
money by itself does not incite robbers to violence towards the staff and customers.

5.2 The bait money is currency notes whose serial numbers and series of issue have
been noted either by micro-filming or simply by noting down their numbers and
keeping them in a safe place separately. These currency notes which are "Recorded"
should be placed among the currency in bank safe, cashier's cash box, teller's till and
containers of the cash in transit. In the case of a holdup, these recorded notes are
purposely included in the "Loot" or are unknowingly carried by the bandits who steal
the cash.

5.3 The number and denomination of currency notes to be used for the purpose would
depend entirely on the discretion of the Branch Manager. However, as a guideline only
one or two bundles of different denominations be kept at each place. It is, however,
preferable that the notes selected should be fairly new, preferably of same series and
be in sequence.

5.4 Bank robbers are highly afraid of bait money as there is no knowledge which of
the stolen notes might have been recorded. It is, therefore, necessary that these
details are circulated after a theft, only to the police, bank etc., but must be withheld
from the rest and the public. The desperadoes would be only too happy to have these
numbers.

5.5 Operational Instructions: Branches are required to adhere following measures

to ensure proper keeping of bait money at all places where bank’s cash is kept.

i) The average cash held in a Branch will be the guiding factor for the
denomination of bait money packet. A branch with high average cash holding
i.e. above 10 lakh can keep bait money of Rs.100/Rs.500. However, a branch
with a lower cash holding should at least maintain a bait money packet of
Rs.50/-. No branch should maintain bait money less than Rs.50/-.
iii) The bait money should be changed at least at an interval of three months or
in case of change of branch manager/cashier, or in case it has been paid due
to urgent requirement, a record of the same should be maintained by the
cash officer/chief cashier/cashier-in-charge. The bait money shall be kept in
each cash counter, be it payment/receipt or teller. This also holds good for
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 all branches under CBS, where cash is paid/received on all counters. The bait
money shall also be kept in cash safe along with cash.

iv) Branches / currency chests doing cash remittance shall ensure keeping of bait
money in each box. For this one note packet from the remittance may be
taken as bait money and its numbers written at the back of the voucher/pass
book. Once the remittance reaches its destination safely, the packet whose
numbers have been noted may be deposited along with other cash
remittance. Thus there will be no need to carry back the bait money.
v) Bait money should be prepared in fairly fresh/issuable currency notes as per
the availability. The same shall not be prepared in soiled/mutilated currency.
vi) The currency packet need not be given a permanent mark for its recognition.
The cashier should arrange to put a small distinguishing mark, which may be
understandable to him only and should not be overtly visible.
5.6 Bait money has the following advantages:
(a) When recognized, it leads to the location and identification of suspects.
(b) The robbers in possession of decoy money, when arrested, confess their
offence.
(c) In the absence of confession, bait money serves the prosecution as
evidence in convicting criminals arrested with it in their possession.
(d) It is easy to use, inexpensive and highly effective in the apprehension and
prosecution of the offender.
(e) The use of bait money or decoy money has been recommended by the
Government and Indian Bank's Association. The use of bait money serves as
a great deterrent to the persons attempting robbery.
5.7 The Zonal Managers, Security Officers and other designated officers of the Zones
while visiting Branches should ensure that these instructions are followed meticulously.

6. Daily Cash Position

6.1 The optimum level of cash holding in a Branch would mainly depend on:

i) size of business consisting of deposits and advances;

ii) pattern of cash receipts and cash withdrawals by various types of
customers;

iii) arrangement of cash payment to ATMs and cash receipt through Cash
Deposit Machines (CDK / BNA);
iv) Facilities available for lodgment and replenishment of cash.

6.2 It is the duty of the Manager to maintain adequate cash reserve position. In
determining the daily cash reserve position, overdue deposits and the deposits
503
maturing in the next few days, outstanding commitments under sanctioned limits of
advances, maturing loans, cash receipt and payment through alternate delivery
channels and the bills and the position of drawings of demand drafts, telegraphic
transfers, etc., should be taken into account. A careful but conservative estimate of
Branch receipts and payments should be made.

6.3 Cash Retention Limit: Branches should operate within a cash retention limit
equal to 0.25% of their total deposits. If a higher cash retention limit is desired, the
branch concerned should obtain approval from the Zonal Office by giving justification
for the enhancement. Zonal offices should ensure that the overall cash holding of the
zone is maintained at 0.25% of the total deposits of the zone, by reducing the cash
holding limits of branches having easy access to the currency chest.

6.4 Noting about the file / approval for cash retention limit of a Branch should be
made in the Branch Documents Register at the appropriate place, if it is higher than
the limit prescribed for the Bank as a whole, i.e. 0.25% of the total deposits.

6.5 Zonal Offices should generate a statement through CBS, generate reports of
branch wise Daily Cash Balance (DCB), balances with SBI/other Banks and cash
retention position through BO report link and verify and monitor the cash position at
branches on regular interval.
6.6 It should be ensured that the Branch cash balance consists of currency notes of
different denominations in adequate proportions so that the Branch is able to pay
currency notes in the denominations required by customers.

6.7 It is advisable that the Branch Manager / Designated Officer scrutinizes the
outward clearing to see if there are cheques of large amounts, so that if necessary,
the remittance to Treasury Branch under the Remittance Facilities Scheme of the
Reserve Bank of India could be arranged. Remittance of surplus cash by branches to
Treasury Branch must be made by RTGS / NEFT only; Treasury Branch should be
advised of such RTGS / NEFT remittance through MESGDTL menu in Core Banking
Solution.

7. Survey of Cash Position

7.1 Survey of the cash position of Branches must be done as a continuous process
to ensure that funds are not lying idle and the cash in excess of the minimum required
for day-to-day working is promptly remitted to Treasury Branch. Those Branches who
may not have a current account arrangement with other banks / having distance from
currency chest for replenishing cash, must take into account their need of funds before
remitting their surplus cash.
8 Remittance of Surplus Cash

8.1 Surplus cash balance in accounts maintained with State Bank of India / Other

504
Nationalized Banks / Private Banks must be remitted to Treasury Branch by
RTGS/NEFT. Reserve Bank of India provides remittance facilities to scheduled
commercial banks under its Remittance Facilities Scheme, with a view to facilitating
the transfer of funds between different centers expeditiously and at the minimum cost.
Branches should have to remit their surplus cash / balances to Treasury Branch
Mumbai.

8.2 While effecting remittance through State Bank of India / Other Nationalized
Banks / Private Banks, the Treasury Branch should also be advised through MESGDTL
menu in Finacle System and full instructions must also be given to State Bank of
India / Other Nationalized Banks / Private Banks to credit our Treasury Branch with
full details of our remitting branch. As at some centers, the names of our Branches
are not identical with the names of the State Bank of India branches /Other
Nationalized Banks / Private Banks.

8.3 Branches can make arrangement with Currency Chest of other banks under RBI
linkage scheme, where our banks currency chest is not available at the Centre for cash
lodgment. Branches can forward their request for linkage to issue department of the
RBI regional office with full details through Zonal Office. At present, RBI allowed the
currency chest holding banks to levy the service charges on cash deposited by non-
chest bank branches @ Rs. 5/- per packet of 100 piece of currency notes.

8.4 (i). Lodgment of excess cash to RBI / SBI / other Banks should be effected initially
by debiting G/L Suspense Account (CASHTR001). This has to be squared up to the
debit of G/L Account RBI / SBI / other banks on the same day after due verification of
the counterfoil duly acknowledged for receipt of cash by the Receiving Bank.

ii. All remittances/lodgments of cash between our branches (not served by Currency
Chest) and between branches and currency should be routed through the CASHTR
module in Finacle.

Details of this module are:

Introduction of NEW MODULE ‘CASHTR’ in Finacle to route
Transactions relating to Cash lodgments and Withdrawals

i) Between Branches and Currency Chests (vice versa)

ii) Between Branches
iii) Between the Currency Chests
In order to discontinue SCS/CN/DNs or CO/Dos in
these transactions w.e.f. 01.10.2010
-----------------------------------------------------------------------------------
For cash lodgments and withdrawals in the following cash transactions
i) Between Branches and Currency Chests (vice versa)
ii) Between Branches
iii) Between one Currency Chest to another Currency Chest
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and to implement the new procedure, a new Module ‘CASHTR’ has been introduced
to route the above-mentioned transactions without the necessity of using
SCS/CN/DNs and CO/DOs. Now the transactions will be conducted through a new
account Sol-id+Cashtr001 The Transaction Flow in the new Module is as under:-

a) At the Branch/ Currency Chest lodging Cash

DR. Sol-id (Cash lodging Branch) + Cashtr001
CR. CASH
For example if the Branch Code of Cash Lodging Branch is 8888 then the
entry is 88880Cashtr001.
The above transaction is to be done through ‘TM’ Menu like Cash Payment.
b) At the Branch/ Currency Chest receiving Cash
DR. CASH
CR. Sol-id (Cash receiving Branch) + Cashtr001

The above transaction is to be done through ‘TM ‘menu like Cash Receipt.

iii. At this stage, the Cash Lodging Branch Cashtr001 account will be in debit balance
and Cash Receiving Branch Cashtr001 will be in credit balance as seen above. Now the
Cash Receiving Branch has to credit the Branch which lodged cash with them by invoking
the new Menu ‘CASHTR’ and capture the Branch Code of Cash lodging Branch and the
amount of Cash received. After verification of the particulars, the system will generate
the following entries.

DR. Sol-id (Cash Receiving Branch/ Currency Chest)

CR. Sol-id (Cash Lodging Branch/ Currency Chest)

Thus, the Cashtr001 account becomes ‘NIL’ at the end of the day in both the
branches.

iv. Please note that ‘CASHTR’ Menu is to be RUN by Cash Receiving Branch
only and not by Cash Lodging Branch.

It is the responsibility of the Cash Receiving Branch to credit the amount received by
them to Cash Lodging Branch through ‘CASHTR’. Menu on the same day of cash receipt
without fail, otherwise the Branch will not be able to do CSOLOP on that day. Cash
Lodging Branch has to monitor their Cashtr001 has been credited by Cash Receiving
Branch.
9. Sealing of Currency Notes
9.1 With a view to streamlining the procedure for cash remittances between Branches
and to Currency Chests as also expediting transfers of surplus cash from one Branch to
another and/or the Currency Chests a procedure for sealing of note packets has been
devised in accordance with the guidelines from Reserve Bank of India which is expected
to bring about uniformity and ease the problem of counting the note packets and
deployment of necessary manpower at the Branches maintaining Currency Chests.

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9.2 A pre-requisite of this procedure is that, before the tenders are brought to the
Currency Chests by other Branches, they should be properly sorted into re-issuable
and non-issuable notes and affixed with appropriate labels. Cut, defective, torn,
mutilated notes should be deposited with the Currency Chest Branches separately and
not put in packets of non-issuable notes. Once the packets are sealed as per the
procedure, the re-issuable note packets can be retained by the Branch and issued in
transactions with the public without counting being done at any stage. Whenever
surplus cash at the Branch is required to be remitted to Currency Chest Branch, re-
issuable and non-issuable packets shall be accepted at the receiving Branch without
counting. Note packets containing re-issuable may be used for diversion of funds to
deficit chests by surplus currency chests under instructions from Currency Officer (For
details, please refer to Appendix X).

10. Replenishment of Cash

10.1 Managers should ordinarily replenish cash by advising Treasury Branch through
Finacle system of Bank’s Core Banking System under HPORDM menu (R42) to remit
the required amount to SBI / other Nationalized Bank / Private Bank with which the
branch is maintaining its account through RTGS.

11 .Safety of Cash in Transit

11.1 All remittances in excess of Rs 20 Lakhs should be sent only by cash vans. All
cash remittances should be accompanied by at least two employees, one of whom will
be staff of the cash department and the other, a subordinate staff. Newly appointed
employees should be avoided. Armed guards will accompany all remittances exceeding
Rs 20 lakhs. The two most important principles for ensuring security of cash in transit
are:
a) No fixed pattern should be allowed to emerge with respect to route, day of the
week, time, vehicle used etc. about the remittances.
b) Fool proof secrecy about the information regarding the remittance must be
ensured. The principle of "Need to know" must be strictly followed.

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11.2 Movement of Cash in Cash Vans

a) As far as possible, cash must be transported by cash van, either owned or

hired.

b) Cash remittance up to an amount of Rs 20 Lakh may not be escorted by an

armed guard.

c) Remittance exceeding Rs 20 lakh but less than Rs 50 lakh should be escorted

by one armed guard.

d) Remittances exceeding Rs 50 lakh should be escorted by two armed guards.

e) Any remittance should never exceed the limit for which insurance cover is
available. This limit is revised by the Bank (Estate Department, Head Office) every
year. Presently, the insurance limit is Rs. 6.00 crore.

f) Policy regarding cash remittances outlined in Para 11.2(a) to 11.2 (e) above
is in accordance with the recommendations of the IBA Committee to Review
Security Arrangements in Public Sector Banks dated May 1996 and subsequent
report dated 2004 which has been accepted by our Bank. However, in order to
take care of the acute security threat, following policy has been adopted by the
Bank, which overrides all other instructions on the subject:

i) All remittances, irrespective of amount, will be carried in cash vans only,

which may be either bank's own or hired vans.

ii) All cash vans, irrespective of the amount being carried, shall be escorted
by two armed guards of the Bank.

iii) Zonal Offices will identify suitably located Nodal Branches which will
receive/dispense cash from/to nearby branches. Nodal centers may be
equipped with small cash vans based on Tata Sumo vehicle, either hired or
owned by the Bank, for the purpose of cash remittances. These branches
shall also be posted with two armed guards for cash escort duties. Nodal
centers, in turn, will depend upon nearest currency chest for cash
withdrawal/deposit.

iv) All cash escort armed guards shall be equipped with 12 bore Pump Action
Shot Guns only.

v) Zonal Offices may decide on case-by-case basis to allow any remotely

located branches to carry cash remittances under their own arrangement,
taking into account distance factor, quantum of cash, security situation etc.

g) Large remittances should possibly be broken into smaller amounts to reduce

security risk.

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 h)In case of very large remittance, second vehicle may be used to shadow the
cash van. Such a vehicle used for shadowing the cash van should be a suitable
bank vehicle or hired one. While hiring the vehicle, the purpose should not be
disclosed. Basically decision to provide shadow van has to be taken by local
authorities based on local threat perception which varies considerably from region
to region.

i)While removing the cash from strong room to cash van, it should be ensured that
-
a) Main door of the branch is closed and access to outsiders is barred till cash is
moved out of the branch.
b) The armed guard has taken necessary precautions including checking of fire
arm and ammunition and has positioned himself suitably for guarding the
cash.

j) Both the joint custodians of cash must be present while removing cash from the
strong room.

k) As soon as the custodians enter the strong room, the grille door should be
closed.

l)When ready to move, the armed guard must first go out and ensure that there is
no danger and that no suspicious characters are hanging around.

m)Cash should be taken out of strong room only after all clear signal from the armed
guard.

n) Armed guard must not be used for carrying cash.

o) The driver of the van must be ready and seated in the driver's seat of cash van.

p) Cash van should be parked as near to the strong room as possible. Such parking
space should be enclosed by perimeter wall. As far as possible, the van should not
be parked on public road while loading/unloading cash.

q) One armed guard should be next to the driver and the other at the rear of the
vehicle, next to cash compartment.

r) Cash container should be chained to the body of the vehicle.

s) No unauthorized person should be allowed to travel in cash van. Outsiders should

not be given lift in the van.

t) Driver must be instructed to guard against fake accidents, bogus police

officials, unexpected traffic diversions, road blocks and suspicious vehicle following
the cash van.

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 u) Whenever the cash van stops on the road, escorts should not enter into
conversation with strangers and should not accept tea, cigarette, tobacco, biscuits,
etc. from them.

Cash van design should be as per the standard design approved by the Bank.

w) "Cash vans should be equipped with security alarms, GPS and CCTV. The
Security officers must have the GPS service providers IP link, user id and password
so that they can carry out surprise check on the movement of cash vans under
their jurisdiction area.

x) Thevehicle used as cash van should have adequate head space so that the gun
provided to the armed guard can be easily maneuvered. It should be maintained
in good mechanical condition. Break downs on the road are detrimental to security.
A standard design for cash van is shown in the Appendix IV.

11.3 Use of Private Vehicle

a) Private vehicles may be used whenever cash van is not available. A covered vehicle
should be preferred to open one and as far as possible taxi should be preferred to
a three wheeler scooter and three wheeler scooter to cycle-rickshaw; When a taxi
is being used, cash box should not be kept in the luggage boot of the vehicle but
should be kept inside and chained to the body of the vehicle.

b) Precautions applicable to transportation of cash from strong room to vehicle

should be strictly observed.

c) As far as possible, an audible alarm bell should be fitted to the cash box.

d) At least two persons should escort the remittance; out of which one should be an
armed guard.

e) Stationery vehicles in taxi/rickshaw stand or those standing near to the branch

should not be used for carrying cash remittance. As far as possible, vehicles from
the same service provider should not be used repeatedly.

f) Passbook for recording the name and address of the driver/owner of the hired
vehicle and its registration number should be maintained at the branch.

g) Vehicles other than four wheeler/taxi should be used only as last resort. In such
cases, individual remittances should not exceed Rs 2 lakh.

h) If vehicles of the above type are not available, then remittances may be sent in
cycle-rickshaw. While carrying remittances in cycle-rickshaw without armed guard,
the remittance should not exceed Rs.1 lac and when accompanied by armed
guard, it should not exceed Rs 5 lakh.

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11.4 Remittances Carried On Foot-Incase no mode of transport is available and if
the distance is very short, remittances may be carried on foot.

a) In such cases, individual remittance should not exceed Rs.1 lac, to the extent
possible.

b) For carrying cash on foot, box/brief case fitted with electronic Alarm system should
be used. The alarm system should be capable of remote activation and should
deliver non-lethal electric shocks to bag-snatchers, on activation, in addition to
audio signals.

c) Carrier of cash box/brief case should walk in the front and the escort should follow
him about 5 to 10 steps behind.

d) Both the carrier and the escort should walk on the side of the road which faces
oncoming traffic (i.e. on right side). As far as possible, they should use busy
routes.

e) While carrying cash, carrier or the escort should not enter into conversation with
any person whether Bank employee or stranger. The escort should preferably be
armed or should carry a baton.

f) Streets with very heavy traffic or traffic bottlenecks should be avoided.

11.5 Remittances by Public Transport

In case distance between the branches is considerable and no other mode of transport
is available then public transport, may have to be used for carrying cash remittances.
Although public transport per say is a safe mode of transport, vulnerability is high
during transit from branch to bus / train station at both ends.
(a) Remittances by train:
i) Seats farthest away from the entrance door should be occupied;

ii) Preferably, journey be undertaken in first class compartments.

iii) If the remittance exceeds Rs 50 lakh, it should be escorted by police armed

guard.

iv) If carrying remittances by train is a regular feature different trains should be

used on different days.

v) Cash container should be chained to the body of the train; escort should
remain vigilant if night journey is involved.
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 (b) Remittances by bus:

i) Seats away from the entrance should be occupied.

ii) Escort should sit behind the cashier.
iii) Direct bus routes should be preferred to circuitous routes.
iv) Different days and different time should be selected for transportation of cash
by bus.
v) If the cash remittance is above Rs 50 lakh it should be escorted by two armed
guards. If the route of remittance is dangerous and passes through a crime
prone area a guard must be provided irrespective of the amount of remittance.
11.6 Remittance by Hired Cash Van

While hiring cash van, following guidelines should be followed:

a) Zones should exercise caution and should hire agencies enjoying good
reputation.

b) Preferably, a new vehicle of suitable make be hired.

c) While deciding about model/make of the vehicle following criteria be applied

i) Suitability to terrain, road and traffic conditions.

ii) The body of the van should allow sufficient room for unhindered movement
of gun carried by the armed escort.

iii) The vehicle chassis should be capable of taking extra weight of armor-plating
if bomb proofing of the vehicle is felt necessary at a later stage.

d) The agency should indemnify the bank against losses if any.

e) If the driver and other employees are provided by the agency, their police
verification must be demanded.

f) Fitness certificate from RTO be demanded and held on file.

g) Only those personnel of agency be allowed to work with the cash van, whose police
verification reports have been submitted by them.

h) The agency contracted should provide mobile phone in the cash Van. Bills for all
operation related calls may be borne by the Bank.

i) Design of the cash van should conform to Bank's standard design.

j) No unauthorized person should be allowed to travel in the cash van - only those
connected with remittance be allowed on board.

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11.7 General Precautions for Cash in Transit
a) The amount of cash sent from one point to another should not exceed the limit for
which transit insurance is obtained.
b) It is preferable to divide large amounts, and carry them in separate batches, if
necessary, at different times during the day.
c) Where transportation of cash between two offices is a regular feature, care should
be taken to ensure that specific pattern with regard to dates, days, timings,
routes, frequency etc. does not emerge. In short, the days, dates, timings, routes
and the staff should be changed at regular intervals and as frequently as possible.
d) Dual keys for container may be used for the cash in transit. Wherever possible,
two keys should be kept and carried separately by the cashier and the escort
respectively.
e) The routes where traffic bottle-necks are a common feature should be avoided.

f) Advance intimation, either telephonically or by any other means should be sent by

the remitting branch to the receiving branch. In the event of failure of reporting in
time, on the part of the employees accompanying the cash, immediate follow up
should be initiated by the receiving branch.
g) Secrecy should be maintained regarding the position of the cash remittance.
Principle of "need-to-know" should be strictly followed.
h) While sending such information, it must be remembered that the culprits may
collect information about remittances by listening to telephonic conversation or by
clandestinely reading messages/letters, about remittances. The information
regarding remittances must, therefore, be sent very carefully and if possible,
through coded messages.
i) Discussions about remittances should be restricted to those people directly
concerned with the remittances. Also, information regarding remittances maybe
made known to the employees concerned only when the remittance is ready to be
sent.
j) Discussions, if any, should be held in secured places. Wherever messages are sent,
they should be coded properly, information such as amount, dates and time of
remittances, route, number of escorts etc. of such messages must be marked as
strictly Private & Confidential.
k) Remittances should be sent preferably during the day time.
l) The cash and valuables which are to be sent, should be ready well before the actual
time of loading. Similarly, vehicles, armed escort, accompanying cashier and the
carrier should be ready well before time.
m) The driver and the escort must both be on their guard against fake accidents,
bogus police officials, un-expected traffic diversions, road blocks and suspicious
vehicles following the Cash Van. In case of any suspicious movement on the road,
the driver should stop well short of the obstructions, and should alert the armed
guard.
n) In case of doubt/suspicion, the remittances should be taken back or the driver
should drive his vehicle into the nearest police station.
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 o) During Civil unrest/riots or turbulence, disturbed conditions etc., if the remittances
have to pass through the affected areas, additional security arrangements should
be made. The Police authorities should be consulted regarding carrying the
remittances through such areas.
p) At the receiving branch, on the receipt of information that the remittance is being
received, Armed Guard should be posted at the cash room.
q) The receiving branch should verify that the persons accompanying the cash are in
fact, representatives deputed by the remitting branch. This can be achieved by
matching of signature or by use of Identity Cards
r) The receiving branch should open the boxes in the presence of the Joint Custodians
of cash at the branch and the employee from the remitting branch accompanying
the remittance.
s) Any discrepancy found in the remittances should be pointed out at once to the
remitting branch and the signatures obtained therefor.
t) The remittances should be opened in the room in which the safe is located and
pre-cautions laid down for opening of the safe should be strictly followed.
u) The receipt of the remittance should be acknowledged to the remitting branch with
special urgency.
v) Armed Guards, accompanying the cash van or those posted in the receiving branch,
must never be used as carriers of cash boxes etc.
w) In Rural branches, where a choice between public transport and coolie services is
available, the former should be used.

x) A check list of pre-cautionary measures evolved must be followed regularly.

11.8 Cash Transportation in North Eastern & Other Special Areas

Militancy/Insurgency affected areas, such as those in the North-East, need special
security measures to deal with extreme security threats, poor communication and road
conditions etc. Adequate escorts during transit should be provided by CRPF or BSF.
Superintendents of Police (SPs) may approach local CRPF/BSF authorities for provision
of escort to give better protection in the case of an attack and to provide for any
dislocation caused due to breakdown, an additional vehicle should follow the vehicle
carrying cash. Remittances should be dispatched during day time and should reach the
destination well before sunset. Strict Secrecy of remittances should be maintained.
Wireless communication facilities should be provided in cash vans so that contact can be
maintained with pilot and escort vehicles. Keeping in view the nature of the threat
existing in the area, inter-branch remittances of Rupees ten lakhs and above should be
carried only with police escort. Should the situation so warrant, branches may ask for
police escort for lesser amount. Comprehensive plan for remittance of cash to the bank
branches be got prepared in consultation with Zonal Security Officer/Local CRPF/BSF
authorities, the Director General of Police and Superintendents of Police of the State.
a) Absolute secrecy should be maintained about road journeys. Only one or two
persons at senior level should have prior knowledge about the date and mode
of movement of large sums of cash. Proper planning for such road journeys
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 should be made, not by the Bank officials alone but in consultation with and
approval of the security forces. Only a senior officer of the force security
concerned should be made in-charge of the operations.
b) The transportation of cash should be made in proper chests and only in
Government vehicles. Hiring of private vehicles should be totally prohibited.
c) The ground rules regulating the convoy system, like ‘road opening’ pilot and
escort vehicles, use of W.T. equipment should be scrupulously observed.
Escort parties should be drawn only from CRPF / BSF in adequate strength.
d) Instead of having scheduled flights of known predictability/ frequency, the
flights could be made to operate at random. This would enhance the security
of such flights.
e) Adequate manpower arrangements may be made for offloading/loading of
the helicopters so as to reduce the exposure time of the helicopter on ground
to the bare minimum.
f) Adequate security arrangements by way of armed guards, etc. should be
made in consultation with military/Para-military forces at or around the
helipads. In this regard, the military commander would be the best judge of
the local threat perceptions.
g) It should be ensured that packing/loading of cash is completed before 09.30
hrs. so that escort duty could be performed smoothly as per programme.
h) Branches should be made to understand the need to maintain utmost secrecy
regarding destination of cash being escorted and keeping the plan a closely
guarded secret.
i) Roadworthy vehicles should be provided to the escort parties to avoid
breakdown on the way.
j) Semi-bullet-proof vehicles may be provided to the escort party so that it can
overcome the initial shock of fire from the insurgents and react immediately.
k) Steps should be taken to see that the cash convoy is not caught up in traffic
islands while escorting cash from bank to other places.
l) As far as possible, the escorting of cash should be entrusted to CRPF
personnel.

11.9 CASH AT COUNTERS AND MOVEMENT OF CASH FROM STRONG ROOM TO

COUNTER AND VICE VERSA

Following measures to be strictly followed while moving cash from Strong room to the
counters:

a) It must be ensured that the amount of cash at the counter, does not exceed the
amount required and prescribed.
b) Dual control must be exercised at all times. If on occasion, one of the joint holders
has for some reason to be away from the branch during banking hours, appropriate
515
 arrangements should be made for the continuance of the dual control.
c) All withdrawals and lodgments of cash from/into, the cash safe / strong room must
be undertaken under dual control. Every entry in the cash-safe-in and the cash-
safe-out register must be authenticated by both the joint holders. Cash must be
taken out of the strong-room on a minimum number of occasions.

d) The cash safe should be secured each time it is opened.

e) The main door of the branch should be closed and bolted from inside when the
cash is taken out of the strong-room to the counters in the Cash Department and
similarly when the cash is brought back from the counters to the strong-room.
Where an armed guard is posted, he should escort such cash in transit.
f) The cashier must invariably bolt and lock the door from inside when he is in the
cabin. Similarly, the cash cabin door must also be locked from outside whenever
the cashier goes out of the cabin even for short periods, so that no unauthorized
person can enter the cabin.
g) The cashier may leave the cash cabin, only after ensuring that both the cash and
the cash cabin are safely locked.
h) When cash is being handled on the cash counter, it must be ensured that the cash
is not left lying on the table in such a way that it can be reached by a person, by
putting a hand in the window from outside.

i) No person, whether a member of the staff, or the public should be allowed access
to the cash department without adequate reason and the permission of the Head
Cashier/Cashier-in-charge of the Cash Department.
k) Enquiries from the public must not be entertained at the cash counter. All such
persons making enquiries should be directed to the enquiry counter/ other
officer(s). Unusually heavy receipts of cash should be transferred to the strong
room at the earliest opportunity.

l) Cash cabins must be enclosed by see-through partition walls. Thick plate glass or
wire-netting of 2.5 cms square, may be used for the purpose. It must be ensured
that registers and other books/records, are not piled against the partition, thereby
obstructing the view.

m)The doors to the cash counters must be fitted with night latches so that once
closed from within, they cannot be opened from outside operating the keys.
n) The cashier's cabin should have a small window at the rear, so that cheques,
registers, etc., can be passed through it without opening the door.

o) The windows of all cash counters should be provided with sliding flaps which
cannot be opened from outside.

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 p) The height of the cash cage should be adequate to prevent a person standing
outside from reaching the counter level.

q) The breadth of the work-table on the cashier's side of the counter should likewise
be such that a person standing outside cannot reach the drawer level.

r) The cash counter should have work tables at two levels - one of the same level as
the counter on the customer's side and the second at a lower level where drawers
for keeping cash will be fitted.

s) The cash drawers should have appropriate locking arrangements.

t) The cash window should provide space just enough for a hand to pass through.

11.10 Branches should also refer to chapter 26 for detailed guidelines on security
aspect. A check list of guidelines for strengthening of overall security arrangement in a
Branch is given in Appendix to Chapter 26 on “Branch Premises, Furniture and Fixtures”
of the Manual of Instructions, Volume 2 "Miscellaneous Services" for compliance of
every Branch Manager and Officer who is responsible for the security of the Branch, for
ascertaining the degree of overall security at the Branch. These guidelines are not
exhaustive and may have to be modified suitably and updated keeping in view the local
conditions. Yet, these provide some minimum hints to the Manager to be prepared in
advance to face any emergency, if arises.

Currency Notes/Coins Sent by Post

The procedure for sending currency notes/coins by post is given in detail in the Chapter
on Correspondence, Dispatch and Filing, in Manual of Instructions, Volume 2:
"Miscellaneous Services".

12. CASH RECEIPTS

13.1 Receiving Cashier(s): When the paying-in-slip is presented to the receiving

cashier, after counting cash and satisfying himself that it is in accordance with the
denominations stated on the paying-in-slip / voucher, sign the paying- in-slip / voucher
and system generated receipt, affix the "cash received" stamp on the paying-in-slip/
voucher and also on the system generated receipt. Receipts for cash deposited in
Deposits and Advances accounts have to be generated from the system and it has to
be given to the customers. The printing of receipts is necessary and made compulsory
as the system of scrolling of receipt voucher was discontinued on account of
computerization of branches, to protect against frauds in this area.
The receiving cashier should take particular care to guard against accepting forged or
defective currency notes by processing the notes on the Note Authentication cum
Sorting Machine where provided. Where the particulars of denominations are not
517
recorded or are recorded incorrectly, the receiving cashier should request the depositor
to enter or correct the particulars and cutting for correction should be authenticated by
full signature of the depositor.
13.2 The Branch cashier / Single Window Operator should initial/sign all paying-in-
slip/vouchers of cash and enter the receipt in the system, mark the transaction number
on the voucher and hand over the system generated receipt to the depositor.

13.3 Branches should check CTR/STR reports from Day End Reports on daily basis to
ensure that any unusual transactions are not routed through the accounts and no money
laundering activities are enabled.
13. Receipt of Cash after the Daily Cash Balance Book is closed

14.1 Any receipt of cash by a Branch after the Daily Cash Balance Book is closed, the
amount (cash) and the relative paying-in-slip/voucher should be kept in an envelope
with the name of the depositor and the amount deposited super scribed thereon under
the initials of the Manager and the Branch cashier. The envelope containing the cash
received should be kept in the cash safe overnight. On no account should the Daily Cash
Balance Book once closed be reopened.

Forged / Stolen Notes: Procedure

15.1 Cash department staff i.e. the cashier-in charge and the cash clerks as well as the
single window operators handling cash operations should familiarize themselves with
the security features of genuine currency notes of different denominations. For this,
they may visit RBI website and click on “paisa bolta hai”
(https://www.paisaboltahai.rbi.org.in) and get the details in an inter-active manner.
Branches may also obtain posters showing features of genuine notes from RBI regional
issue office through their zonal office and display in the branch premises for the benefit
of staff and customers.
16. Detection and Impounding of Counterfeit Notes:

16.1 Banknotes tendered over the counter shall be examined for authenticity
through machines. Similarly, banknotes received directly at the back office /
currency chest through bulk tenders shall also be examined through machines. No
credit to customer’s account is to be given for Counterfeit Notes, if any, detected in
the tender received over the counter or at the back-office / currency chest. In no
case, the Counterfeit Notes shall be returned to the tenderer or destroyed by the
bank branches. Failure of the banks to impound Counterfeit Notes detected at their
end will be construed as wilful involvement of the bank concerned in circulating
Counterfeit Notes and penalty will be imposed.

16.2 Impounding of counterfeit notes:

Notes determined as counterfeit shall be stamped as "COUNTERFEIT NOTE" and

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 impounded in the prescribed format (Annex II). Each such impounded note shall be
recorded under authentication, in a separate register

16.3 Issue of Receipt to Tenderer:

When a banknote tendered at the counter of a bank branch / back office and currency
chest is found to be counterfeit, an acknowledgement receipt in the prescribed
format (Annex III) must be issued to the tenderer, after stamping the note as in
paragraph 3 ibid. The receipt, in running serial numbers, shall be authenticated by
the cashier and tenderer. Notice to this effect shall be displayed prominently at the
offices / branches for information of the public. The receipt is to be issued even in
cases where the tenderer is unwilling to countersign it.

16.4 Detection of Counterfeit Notes - Reporting to Police and other bodies:

For cases of detection of Counterfeit Notes up to four (04) pieces in a single

transaction, a consolidated report in the prescribed format (Annex Iv) shall be sent
by the Nodal Bank Officer to the police authorities or the Nodal Police Station, along
with the suspect Counterfeit Notes, at the end of the month.

For cases of detection of Counterfeit Notes of five (05) or more pieces in a single
transaction, the Counterfeit Notes shall be forwarded immediately by the Nodal
Bank Officer to the local police authorities or the Nodal Police Station for
investigation by filing FIR in the prescribed format (Annex V).

A copy of the monthly consolidated report / FIR should be sent by Nodal Bank Officer to
the Forged Note Vigilance Cell (FNVC), General Operations Department (GOD) at Head
Office through email having address: [email protected] by 2nd of the
next month for which the report pertains.

Acknowledgement of the police authorities concerned has to be obtained for note/s

forwarded to them (both for consolidated monthly statement and for filing of FIR). If
the Counterfeit Notes are sent to the police by insured post, acknowledgement of
receipt thereof by the police shall be invariably obtained and kept on record. A
proper follow up of receipt of acknowledgement from the police authorities is
necessary. In case any difficulty is faced by the banks due to reluctance of the police
to receive monthly consolidated statement / file FIRs, the matter may be sorted out
in consultation with the Nodal Officer of the police authority designated to coordinate
on matters relating to investigation of Counterfeit Notes cases. The list of Nodal
Police Stations may be obtained from the concerned Issue Office of RBI.

In order to facilitate identification of people abetting circulation of Counterfeit Notes,

banks are advised to cover the banking hall / area and counters under CCTV surveillance
and preserve the recording as per their internal policy

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Branches shall also monitor the patterns / trends of such detection and suspicious
trends / patterns and bring to the notice of RBI / Police authorities via Head Office
immediately.

The progress made by banks in detection and reporting of Counterfeit Notes to

police, RBI, etc. and problems therein, shall be discussed regularly in the meetings
of various State Level Committees viz., State Level Bankers’ Committee (SLBC),
Standing Committee on Currency Management (SCCM), State Level Security
Committee (SLSC), etc.

The data on detection of Counterfeit Notes by banks shall be included in the monthly
returns forwarded to the concerned Issue Office of RBI as indicated in para 10
below.

The definition of 'counterfeiting' in the Indian Penal Code covers currency notes
issued by a foreign government authority as well. In case of suspected foreign
currency note received for opinion from the police and government agencies, etc.,
they shall be advised to forward the case to the Interpol Wing of the CBI, New Delhi
after prior consultation with them.

The Government of India has framed Investigation of High Quality Counterfeit

Indian Currency Offences Rules, 2013 under Unlawful Activities (Prevention) Act
(UAPA), 1967. The Third Schedule of the Act defines High Quality Counterfeit
Indian Currency Note. Activity of production, smuggling or circulation of High Quality
Counterfeit Indian Notes has been brought under the ambit of UAPA, 1967.

16.5 Examination of the Banknotes before Issuing over Counters, Feeding

ATMs and Remitting to Issue Offices of the Reserve Bank:

The branches shall re-align their cash management in such a manner so as to

ensure that banknotes in the denominations of ₹100 and above are not put into re-
circulation without the notes being machine processed for authenticity. The said
instructions shall be applicable to all bank branches, irrespective of the volume of
daily cash receipt. Any non-compliance will be construed as violation of the Directive
No.3158/09.39.00 (Policy)/2009-10 dated November 19, 2009 issued by RBI.

In order to obviate complaints regarding dispensation of Counterfeit Notes from

ATMs, and to curb circulation of Counterfeit Notes, it is imperative to put in place
adequate safeguards/checks before loading ATMs with notes. Dispensation of
Counterfeit Notes through the ATMs would be construed as an attempt to circulate
the Counterfeit Notes by the bank concerned. This shall also be applicable to White
Level ATM Operators in terms of circular DPSS.CO.OD.No.1916/06.07.011/2018-
19 dated March 7, 2019.

Detection of Counterfeit Notes in chest remittances is also liable to be construed as

wilful involvement of the chest branches concerned in circulating Counterfeit Notes
and may attract special investigation by police authorities, and other action like
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suspending the operation of the chest concerned.

Penalty at 100% of the notional value of Counterfeit Notes, in addition to the

recovery of loss to the extent of the notional value of such notes, will be imposed
under the following circumstances:

a) When counterfeit notes are detected in the soiled note remittance of the bank.

a) If counterfeit notes are detected in the currency chest balance of a bank during
Inspection / Audit by RBI

16.6 Designating Nodal Bank Officer:

As per RBI direction each bank shall designate a Nodal Bank Officer, district-wise
to serve as the contact point for all Counterfeit Note detection related activities and
notify the same to the concerned Issue Office of the RBI and Police Authorities. All
cases of reporting of Counterfeit Note detection as indicated in Para 5 shall be
done through the Nodal Bank Officer.

All Zones to ensure designation of Nodal Bank Officers in each of district falling under
their Zones and advise them to report all cases of counterfeit notes to the RBI concerned,
Police authorities and at Forged Note Vigilance Cell, GOD, Head Office. The Nodal Bank
Officer is the link between branches and Specialized Designated Police Station in the
district to gather information from the branches and assist branches. The Nodal Bank
Officer also have good liaising with the Police Authorities in their respective district.

16.7 Establishment of Forged Notes Vigilance Cell at Head Office of Bank:

Each bank shall establish at its Head Office, a Forged Note Vigilance (FNV) Cell to
undertake the following functions:

i) Dissemination of instructions issued by RBI on Counterfeit Notes to bank’s

branches/ Currency Chest (CC), monitoring the implementation of these
instructions, compilation of data on detection of Counterfeit Notes, and its
submission to RBI, Financial Intelligence Unit-India (FIU-IND) and National
Crime Records Bureau (NCRB) as per extant instructions and follow-up of
cases of Counterfeit Notes with police authorities / designated nodal officer.
ii. Sharing of the information thus compiled with bank’s CVO and report to him
/ her all cases of acceptance / issue of Counterfeit Notes over the counters.

ii) Conducting periodic surprise checks at currency chests where shortages /

defective / Counterfeit Notes etc. are detected.

iii) Ensuring operation of Note Sorting Machines of appropriate capacity at all the
currency chests / back offices and closely monitoring the detection of
Counterfeit Notes and maintaining the record of the same.
iv) Ensuring that only properly sorted and machine examined banknotes are fed
into the ATMs / issued over the counters by putting in place adequate
safeguards, including surprise checks, both during the processing and transit
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 of notes.

a. FNV Cell shall submit a status report on a half-yearly basis (as at the
end of March and September every year), as per the format
prescribed in Annex VII, by email, to the Chief General Manager,
Department of Currency Management, RBI, Central Office, Amar
Building, Fourth Floor, Sir P. M. Road, Fort, Mumbai 400 001
([email protected]) and to the concerned Issue office of RBI under
whose jurisdiction the FNV Cell is functional, within a fortnight from the
end of the respective half-year.

b. In order to update the record of the addresses of the FNV Cells, the
bank shall furnish by e-mail, in the prescribed format (Annex V), the
particulars to the Chief General Manager, Department of Currency
Management, Reserve Bank of India and to the concerned Issue
office of RBI under whose jurisdiction the FNV Cell is functional, by
15th of April, every year.

16.8 Provision of Ultra-Violet Lamp and Other Infrastructure:

With a view to facilitate the detection of Counterfeit Notes, all bank branches /
identified back offices shall be equipped with ultra-violet lamps / other appropriate
banknote sorting / detection machines. In addition, all currency chest branches shall
be equipped with verification, processing and sorting machines and shall be used to
their optimum capacity. Such machines shall conform to the guidelines on 'Note
Authentication and Fitness Sorting Parameters' prescribed by the RBI from time to
time.
The branch shall maintain a daily record of the notes processed through the Note
Sorting machines, including the number of counterfeits detected.

The branch shall also consider providing at least one counting machine (with dual
display facility) for public use at the counter.

16.9 Reporting of Counterfeit Currency Data by Zonal Office/ Branches:

Branches should report the detected Forged Indian Currency Notes (FICN) details to
their respective Zonal Office for uploading such details on the website of the National
Crime Records Bureau. After uploading the details, Zones will communicate the
generated reference number to respective branch and Nodal Bank Officer by email to
use the reference number by them for reporting/ filling FIR (if applicable).

Zones should also report such detected Forged Indian Currency Notes (FICN) to
Compliance Department, Head Office for further reporting to Financial Intelligence Unit,
India (FIU-IND) by them.

Monthly consolidated data on counterfeit notes detected at branches should be reported

to the Nodal Bank Officer and respective Zonal Office in the prescribed format by 2 nd

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day of the next month for the month which report pertains, in the prescribed format.

Zone should compile the data/ report submitted on counterfeit currency by the branches
and ensure submission of a consolidated report on counterfeit currency to General
Operations Department though email latest by 04th day of the next month in EXCEL as
well as PDF format duly signed by the Zonal Manager/ Deputy Zonal Manager. Hard copy
needs not to be sent.

The above timeline should be strictly adhered to by the Zones so that Bank’s consolidated
monthly report should reach to RBI within due date.

Zones should also send a Quarterly Certificate duly signed by Zonal Manager/ Deputy
Zonal Manager pertaining to Counterfeit Notes (Detection, Impounding and Reporting)
as well as functioning of UV lamps and other infrastructure. The certificate should reach
latest by 10th day of the next month for the quarter ended.

16.10 Preservation of Counterfeit Notes Received from Police Authorities:

Counterfeit Notes received back from the police authorities/courts shall be carefully
preserved in the safe custody of the bank and a record thereof be maintained by the
branch/ CC concerned. FNV Cell of the bank shall also maintain a branch/CC wise
consolidated record of such Counterfeit Notes.

These Counterfeit Notes at branches/CCs shall be subjected to verification on a half-

yearly basis (on 31st March and 30th September) by the Officer-in-Charge of the bank
concerned. They shall be preserved for a period of three years from the date of
receipt from the police authorities.

Counterfeit Notes, which are subject matter of litigation in the court of law shall be
preserved with the branch/CC concerned for three years after conclusion of the court
case.

After the preservation period, such notes shall be sent to the concerned Issue Office
of RBI under whose jurisdiction the branch/ CC is functional, with full details of the
case.

17. Facility of Exchange of Notes and Coins:

17.1 (a) All branches are mandated to provide the following customer services to the
members of public:

(i) Issuing fresh / good quality notes and coins of all denominations on demand,

(ii) Exchange of soiled / mutilated / defective notes and

(iii) Accepting coins and notes either for transactions or exchange.

It will be preferable to accept coins, particularly, of the denominations of ` 1 and 2, by

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weight. However, accepting coins packed in polythene sachets of 100 each would
perhaps be more convenient for the cashiers as well as the customers. Such polythene
sachets may be kept at the counters and made available to the customers.

(b) Branches should provide the above facilities to members of public without any
discrimination on all working days. The scheme of providing exchange facility by a few
select currency chest branches on one of the Sundays in a month remain unchanged.

(c) The availability of the above-mentioned facilities at the branches be given wide
publicity for information of the public at large.

(d) The branches should not refuse to accept small denomination notes and / or coins
tendered at their counters.

17.2 Reserve Bank of India (Note Refund) Rules, 2009 - Delegation of

powers:
(a) In terms of Section 28 read with Section 58 (2) of Reserve Bank of India Act, 1934,
no person is entitled as a right to recover from the Government of India or RBI the value
of any lost, stolen, mutilated or imperfect currency note of the GOI or banknote.
However, with a view to mitigating the hardship to the public in genuine cases, it has
been provided that RBI may, with the previous sanction of the Central Government,
prescribe the circumstances in, and the conditions and limitations subject to which, the
value of such currency notes or banknotes may be refunded as a matter of grace.
(b) With a view to extending the facility for the benefit and convenience of public at
large, all branches have been delegated powers under Rule 2(j) of Reserve Bank of
India (Note Refund) Rules, 2009 for exchange of mutilated / defective notes free of
cost.

17.3 Soiled Notes, Mutilated Notes and Extremely brittle, burnt, charred,
stuck up Notes:
(a) Soiled Notes:

In order to facilitate quick, easy exchange facilities, the definition of soiled note has been
expanded. “A ‘soiled note’ means a note which has become dirty due to normal wear and
tear and also includes a two piece note pasted together wherein both the pieces presented
belong to the same note and form the entire note with no essential feature missing”.
These notes should be accepted over the counters in payment of Government dues and
for credit to accounts of the public maintained with bank. However, in no case, these
notes should be issued to the public as re-issuable notes and shall be deposited in
currency chests for onward transmission to RBI offices as soiled note remittances for
further processing.

(b) Mutilated Notes- Presenting and Passing:

A mutilated note is a note of which a portion is missing or which is composed of more
than two pieces. Mutilated notes may be presented at any of the bank branches. The
notes so presented shall be accepted, exchanged and adjudicated in accordance with
Reserve Bank of India (Note Refund) Rules 2009. Branches should also enable the public
524
to exchange mutilated notes in Mahatma Gandhi (New) series, which are smaller in size
compared to the earlier series in accordance with Reserve Bank of India (Note Refund)
Amendment Rules, 2018.
(c) Extremely brittle, burnt, charred, stuck up Notes:
Notes which have turned extremely brittle or are badly burnt, charred or inseparably
stuck up together and, therefore, cannot withstand normal handling, shall not be
accepted by the branches for exchange. The holders be advised to tender these notes
to the concerned Issue Office of Reserve Bank of India, where they will be adjudicated
under a Special Procedure.

17.4 Procedure for exchange of soiled/ mutilated/ imperfect notes:

(a) Exchange of soiled notes:

i. Notes presented in small number: Where the number of notes presented

by a person is up to 20 pieces with a maximum value of ` 5000 per day, branches
should exchange them over the counter, free of charge.

ii. Notes presented in bulk: Where the number of notes presented by a person
exceeds 20 pieces or ` 5000 in value per day, branches may accept them, against
receipt, for value to be credited later. Branches may levy charges as per Bank’s
circular on Service Charges. In case tendered value is above ` 50000, branches
should take the usual precautions.

(b) Exchange of mutilated and imperfect notes:

(a) The designated branches continue to follow the procedure as laid down in Part III
of Reserve Bank of India (Note Refund) Rules, 2009 (refer Appendix VII) for exchanging
mutilated and imperfect notes and issue receipt for the notes presented for
adjudication.

(b) Non-chest branches should follow the below procedure for notes presented in small
numbers and in bulk;

(i) Notes presented in small number: Where the number of notes presented
by a person is up to 5 pieces, non-chest branches should normally adjudicate the
notes as per the procedure laid down in Part III of NRR, 2009 and Reserve Bank
of India (Note Refund) Amended Rules, 2018 and pay the exchange value over
the counter.
If the non-chest branches are not able to adjudicate the mutilated notes, the
notes be received against a receipt and sent to the linked currency chest branch
for adjudication. The probable date of payment should be informed to the
tenderer(s) on the receipt itself and the same should not exceed 30 days. Bank
account details should be obtained from the tenderer for crediting the exchange
value by electronic means.

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 (ii) Notes presented in bulk: Where the number of notes presented by a
person is more than 5 pieces not exceeding ` 5000 in value, should be advised
to send such notes to nearby currency chest branch by insured post giving the
bank account details (Bank branch name, IFSC, Account No, etc.) or get them
exchanged in person. Currency chest branches receiving mutilated notes through
insured post should credit the exchange value to the account of sender by
electronic means within 30 days of receipt of notes.

All other persons tendering mutilated notes whose value exceeds ` 5000 should
be advised to approach nearby currency chest branch.
(c) Tenderer aggrieved with the service provided by the branches in this regard may
approach Banking Ombudsman concerned, following the procedure as laid under
Banking Ombudsman Scheme, 2006 with the bank /postal receipts as proof for
necessary action. Branches should adhere to the RBI guidelines while receiving
mutilated Notes either through Post or at counter.
17.5 Notes bearing "PAY"/"PAID" "REJECT" stamps:

(a) The Branch Manager and Officer in-charge of the Accounts or Cash Wing shall act
as 'Prescribed Officer' to adjudicate the notes received at the branch for exchange in
accordance with Reserve Bank of India (Note Refund) Rules, 2009 and Reserve Bank of
India (Note Refund) Amended Rules, 2018. After adjudicating mutilated notes, the
Prescribed Officer is required to record the order by subscribing his initials to the dated
'PAY'/ 'PAID'/ 'REJECT' stamp. The 'PAY' /'PAID' & 'REJECT' stamps should also carry
the name of the bank and branch concerned and held under the custody of the
'Prescribed Officer' to avoid misuse.
(b) Mutilated / defective notes bearing 'PAY'/'PAID' (or 'REJECT') stamp of any RBI Issue
Office or any bank branch, if presented for payment again at any of the branches should
be rejected under Rule 6(2) of Reserve Bank of India (Note Refund) Rules, 2009 and
the tenderer should be advised that the value of such note/s cannot be paid since the
same has already been paid as is evident from the PAY/PAID stamps affixed. Branches
should ensure, NOT to issue notes bearing PAY/PAID stamps to the public even through
oversight. Branches should caution customers not to accept such notes from any bank
or anybody else.

17.6 Notes bearing slogans / political messages, etc. :

Any note with slogans and message of a political nature written across it ceases to be
a legal tender and the claim on such a note be rejected under Rule 6(3) (iii) of Reserve
Bank of India (Note Refund) Rules, 2009. Similarly, notes which are disfigured may also
be rejected under Rule 6(3) (ii) of Reserve Bank of India (Note Refund) Rules, 2009.
17.7 Deliberately cut notes:
The notes, which are found to be deliberately cut, torn, altered or tampered with, if
presented for payment of exchange value should be rejected under Rule 6(3)(ii) of the
Reserve Bank of India (Note Refund) Rules, 2009.

It is not possible to precisely define deliberately cut notes, a close look at such notes will
clearly reveal any deliberate fraudulent intention, as the manner in which such notes are
mutilated will follow a broad uniformity in the shape/location of missing portions of the
526
notes, especially when the notes are tendered in large numbers.

The details of the case such as the name of the tenderer, the number of notes tendered
with denominations should be reported thereafter to the Deputy General Manager
/General Manager of RBI, Issue Department, under whose jurisdiction the branch falls
through respective Zonal Offices. The matter should also be reported to local police in
case a large number of such notes are tendered.

17.8 Disposal of notes adjudicated at bank branches:

The full value paid notes, adjudicated by branches have to be remitted to the linked chest
branches to onward submission to RBI, Issue Offices concerned together with the next
soiled note remittance as per laid down procedure.

The half value paid and rejected notes, which are held by the chest branches in their
cash balance, may either be remitted separately packed together with the full value paid
notes or sent by registered and insured post as and when required.

The full value paid notes will be treated as chest remittance by the RBI, Issue Office
while the half value paid notes and rejected notes will be treated as notes tendered for
adjudication and processed accordingly.

All chest branches are required to submit a monthly statement to RBI, Issue Offices
showing the number of notes adjudicated during the month.

17.9 Uncurrent Coins:

The coins of 25 paise and below, issued from time to time, ceased to be legal tender for
payments as well as account with effect from June 30, 2011 in terms of Gazette
Notification No. 2529 dated December 20, 2010 issued by the Government of India.

17.10 Monitoring and Control

(a) The Zonal Managers/ Inspecting Officials should report the compliance status in this
regard, as observed, during their branch visit and report to the Head Office for prompt
remedial action, wherever necessary.

17.11 Display of Notice Board:

All Branches are required to display Notice Board in Hindi, English and Regional
Language, at a prominent place in the premise, indicating the availability of note
exchange facility with the legend, "SOILED/MUTILATED NOTES ARE ACCEPTED AND
EXCHANGED HERE" for information of general public.

Branches should ensure that facility for exchange of notes and coins are not only for the
customers but also to other public. Branches should ensure that the note exchange
facility is not cornered by money changers / dealers in defective notes.
18. Record of Cash Received, Counted and Delivered to the Cashier-in-charge
of the Till

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18.1 The receiving cashier should make packets of currency notes (each packet to be
of 100 pieces of currency notes of the same denomination). For detailed guidelines
please refer to Appendix IX.

18.2 If a cashier wishes to have his packets of Currency Notes tied into bundles:

(a) he should get each bundle of ten packets (or less) duly tied under his personal
supervision; he should not give to the sepoy more than ten packets at one
time;

(b) he should invariably check carefully and satisfy himself that the bundle, when
it comes back to him, contains the ten (or less, as the case may be) packets.

18.3 The particulars of these packets should then be entered in a passbook (a specimen
of the ruling is given in Appendix VIII). The pass book and the counted packets of
currency notes should be handed over to another cashier for recounting of currency notes
in the packets. The other cashier after recounting the notes in each packet, should sign
on each packet underneath the signature of the receiving cashier and also initial in the
pass book. There after the packets should be delivered to the cashier-in-charge of the
Till with the pass book and his initials obtained. The pass book should then be returned
to the receiving cashier who should satisfy himself that the recounting cashier and the
cashier-in-charge of the Till have initialed the pass book in token of their having counted
and received the currency notes respectively.

19.CASH PAYMENTS

19.1 Single Window System

The Single Window System has been introduced to expedite payment of cheques and
render all general services from one counter. Under this system payments up to certain
limit are made by the Single Window Operator without referring to the cancellation
officer in the accounts department, thereby affording quicker disposal of the customers.
The service has been found to be very effective in expediting payments and to improve
our customer services.

I. Procedure

The procedure to be adopted by the Single Window Operator (SWO) will be as under:

(i) The SWO will scrutinize the cheques / withdrawal slips with Pass Books tendered
to him for payment and see if they are prima facie in order; such a scrutiny
would, inter-alia, include -

a) that the cheque/withdrawal slip bears authorized signature;

528
 b) that it is not post-dated or out dated;

c) that it bears no alterations which are not duly authenticated;

d) that the amount in words and figures agree;

e) that there is no stop payment instructions against the cheque presented

for encashment;

f) that the cheque/withdrawal slip is properly endorsed;

(ii) In order to protect against fraudulent alterations, he will see each instrument
under the Ultra Violet Ray Lamp provided to him.
(iii) He will affix the Teller stamp which will have date, Transaction Number and
initial the cheques / withdrawal slip / debit voucher in token of having passed
and paid the cheques / withdrawal slip / debit voucher.

(iv) He will refer to the denominations indicated on the reverse of the

cheque/withdrawal slip and take out cash from his Till accordingly and tick the
denominations and the number of pieces. Where the denominations are not
given by the customer on the reverse of the instrument, he will enter the
denominations and number of pieces. He will count the currency notes and
check the number of pieces in each denomination and then make the payment.

(v)Atthe end of business hours, he will balance the cash and render an amount
to the Cashier-in-charge.

II. Cash Procedure

(i) The SWO would obtain in the morning from the Cashier-in-charge a
reasonable amount of cash in convenient denominations, on the basis of his
estimate of the day's requirements. A receipt for the amount thus obtained
would be given by the SWO in the Book maintained by the Cashier-in-charge.

(ii) During the day, if at any time his cash falls short of the requirements, the
SWO would replenish the cash from the Cashier-in-charge in the same
manner mentioned above.

19.2 Cash Transfers between Head Cashier and Tellers

I. With the migration of all branches to CBS from 16.05.2009, cash transfers between
head cashier and tellers (SWOs) or among the SWOs should be routed through the
system invoking the prescribed menu.
With effect from 15.05.2006, for better control over the posting of cash transfers
between Head Cashier and Tellers can be posted by the respective users only. Thus the
Part-Tran of the voucher set crediting or debiting the Teller account would have to be
529
posted by the respective Teller only. This procedure enables the flows of transactions to
be controlled with the physical movement of the cash between Head Teller to Teller,
Teller to Head Teller & Teller to Teller.
We give below few examples to clarify the change.
a. If Head-Cashier is allotted the TELLER account say TELLER01, then transfer of cash
between System Cash (Sol-Id CASH001) and TELLER01 should be posted by the Head-
Cashier. The Head Cashier should first transfer cash in his TELLER account in morning
and thereafter transfer other cashiers TELLER, say TELLER02, TELLER03, etc. and vice
versa on the close of the cash in evening.
Suppose Head Cashier transfer Cash of Rs. 10,00,000/- from vault and out of this amount
he transfers Rs. 2,00,000/- each to two cashiers having TELLER02 and TELLER03
accounts. The Head Cashier would create following entries –
Debit Sol-ID TELLER01 Rs. 10,00,000/-
Credit Sol-ID CASH001 Rs. 10,00,000/-
b. If Head Cashier is not allotted TELLER account, than Head-Cashier transfers cash of
Rs.1,00,000/- in the morning to TELLER02. The Head-cashier would create the following
entry
Debit Sol-ID TELLER02 Rs.1,00,000/-
Credit Sol-ID CASH001 Rs.1,00,000/-
This entry would go in ‘ENTERED’ status, since Finacle first POSTS the Debit and then
Credit, and the Head Cashier has no right to debit the TELLER02 account. Thus on
receiving cash, the TELLOR02 only would ‘POST’ the debit leg of the transaction and
then Head-Cashier would POST the credit leg.
b. Head-Cashier receives cash from Teller02. The Head-cashier can create the
transaction as below
Debit Sol_ID CASH001 Rs.1,00,000.00
Credit Sol-id TELLER02 Rs.1,00,000.00
Head-Cashier can ‘POST’ the Cash001 leg (since first debit is to be posted), the Credit
Leg will have to be ‘POST’ed by TELLER02 only.
c. TELLER02 wants to transfer cash to TELLER03. Since Teller to Teller transactions are
not permitted, the Head-Cashier can create the transaction as below
Debit Sol-Id TELLER03 Rs.1,00,000.00
Credit Sol-Id TELLER02 Rs.1,00,000.00
The transaction would go in ‘ENTERED’ status, since Head Cashier does not have
rights to either Debit or Credit to TELLER accounts. The Debit part-tran of the above
transactions would be first ‘POST’ed by TELLER03 only, then the TELLER02 alone
would post the Credit Part-tran.
530
d. If Head-Cashier is also allotted the TELLER account say TELLER01, then transfer of
Cash between System Cash (Sol-Id CASH001) and TELLER01 can be ‘POST’ed by the
Head-Cashier.
19.3 Paying Cashier(s)
Signatures of those who receive payments would be obtained even for "bearer"
cheques. This should apply to payments by vouchers also. In case of large payments,
say above Rs.50,000/- name, address and mobile number of the person receiving
payment should be recorded on the reverse of the payment instrument as a measure
of adequate inquiry and precaution.

The denominations of currency notes paid must be entered on the reverse of cheques
or vouchers by paying cashiers.

19.4 Payment of Cheques to Other Banks over the Counters

Refer Chapter on Current/Saving Bank Accounts-General. This facility may not be

extended except in case of issuing cash for their requirements. If the beneficiary is an
account holder of the other bank, payment may be made either through NEFT or RTGS
and payments over the counter should be discouraged.

19.5 Notes Delivery Book

Every receiving cashier and paying cashier should have a Notes Delivery Book (Form
Cash 1080) for his use. The receiving cashier should enter in it the currency notes
(denomination-wise) received during the day. At the end of the day, the cashier-in-
charge of the Till of the Branch should initial in the Book and receive the currency notes
from the receiving cashier.
19.6 Cash Exchange Vouchers
Ordinarily, Cash Exchange Voucher (Form Cash 1143) should be used for exchange of
currency notes of any denominations amounting to Rs. 2,000/- and above.
When the Cash Exchange Voucher is used, no entries need be made in the Receipt Scroll
Book, Cash Receipt Book, Payment Scroll Book and Cash Payment Book. The name and
address of the person who asks for exchange should be entered on the voucher and his
signature taken thereon. At the end of the day the Cash Exchange Voucher should be
placed with other vouchers of the day or filed in the day's record of Cash Department.

20 Shortage and Excess of Cash: Procedure

20.1 When any shortage in cash occurs, the Branch Manager / Manager / Senior
Manager and the cashier concerned should check the particulars of currency notes
received/paid for all transactions handled by the cashier. If the mistake is not located,
the shortage in cash should be recovered from the cashier concerned and the matter
531
reported to Head Office on the same day.

20.2 If there is any excess in cash, the cashier should immediately report the matter to
the Manager / Deputy Manager/ Chief Manager and the cashier should check all
particulars of currency notes for receipts/payments and endeavor to locate the mistake.
If the excess cash is located as belonging to any customer, the amount may be refunded
to him after the Manager is fully satisfied about the bonafides of the customer's claim.
The amount should be refunded by crediting it to the account of the customer or by a
pay slip; it should not be paid in cash. If the mistake is not located, the excess cash
should be credited to Sundry Deposit Account - "Excess Cash Received" and the matter
should be reported to Head Office on the same day. The amount of the excess cash held
in Sundry Deposit account should be transferred to Finance(Comptroller’s) Department,
Head Office after one year from the date of receipt of such excess cash at the Branch
giving full details such as the date of entry etc. Head Office (Finance (Comptroller’s)
Department) will account for such amounts suitably in its books. For this purpose, as
soon as the entry in respect of deposits for excess cash received found is made in Sundry
Deposit account, Branches should take an appropriate diary note, in the next year's
diary.

21 Delivery/Collection of Cash at/from Offices of Customers

21.1 Sometimes customers request the Bank to deliver / collect cash at / from their
office. Such requests may be considered from certain selected customers taking into
consideration the consequential advantages likely to accrue to the Bank. Such requests
should be referred to Head Office for consideration. In recommending such cases,
Branches should furnish the following particulars to Head Office:

(a) Name of the customer and particulars of the account such as date when
opened, maximum balance, minimum balance, average balance, etc.

(b) Nature of the request and other particulars such as maximum amount of cash
expected to be carried at a time from the Branch to the office of the customer
and/or vice versa, distance between the Branch and the office of the
customer, mode of transport of cash, transit time, frequency of cash
delivery/collection, etc.

(c) Whether the customer was having this facility with any other bank, in case
the account is being transferred to us.

(d) Special benefits expected to accrue to the Bank by giving the facility.

(e) Whether the customer is agreeable to bear the insurance premium for a
separate cash in transit policy which will have to be taken out in such cases,
532
 if necessary. Such premium will vary from case to case and will be quoted by
the Insurance Company on details being furnished to them.

21.2 Branches should not lose sight of the possibility of receiving such requests from
other comparable customers.

CTR (Cash Transaction reports) are required to be sent to Compliance Department, Head
Office for onward submission to Financial Intelligence Unit – India (FIU-IND).

533
Cash Module in CBS
Queries Solution
How to generate Cash Use
Transaction Report where the MISRPT > OTHERS > IT01
transaction is above Rs. 10 lakh.

How to generate CDK/BNA MISRPT>OTHERS>CDK-BNA

transaction report

How to assign Head Cashier Please follow the below mentioned steps:-
when regular Head Cashier is 1. HUPM, function M, 2. Give user id of person to
on leave. whom head cashier needs to be assigned, 3. Make
work class as 200, 4. Verify the same
5. Then Use menu EFM , Function M
6. Make „IS EMP HEAD TELLER‟ flag to "Y"
7. Designation as HCE [Head cashier] 8. Press F10
9. Verify the same in EFM

How to assign a teller or which 1. Use menu option GECM function "Add"
menu option is use to assign 2. Give the sol id & PF NO. Press F4
teller. 3. Give Teller No in place holder as per list by
pressing F2.
4. Select a teller no. which you have not assigned
to anyone.
5. Currency as INR, delete flag "N" then press F4 &
F 10

What is the option for various 1. Menu option SCWRPTA for same day
cash related reports transaction.
2. Under PTW menu option select Cash waste
report for given date range.
3. FTR for given date for transaction type as cash
only

What to do in case the cashier If a/c leg is in entered status branch can proxy post
posted one payment transaction this transaction i.e.
with excess wrong amount, a/c leg 1. TM function (M) modify
is in entered status and teller leg is 2. Give specific option Y for proxy posting and press
posted? F4
3. Give single reversal flag Y and press F4
4. F10

534
 This will proxy post transaction.
1. Branch need to reverse this proxy by
using menu option SPTM
2. Function R (reversal) F4
3. Give a/c ID for which proxy is done i.e.
customer a/c ID
4. Press F4 and give shift+F4 for selecting
record.
5. Press F4 and change reversal a/c ID
which will be by default customer a/c ID
6. Change this to some office a/c and then
press F4 which will create transaction and amount
will be transferred to office a/c

You can show receipt to office a/c for balancing

cash.
Do fresh transaction for customer a/c ID for
correct payment a/c
Same process can be followed for receipt is taken
for wrong amount.

When user post cash transaction, Cash leg of the transaction should be posted by a
gets a message "Only teller can user with role Teller, please check whether the
post the transaction". What to do? user is assigned as teller.

1. Use CSE menu option. 2. Function M to modify

then put PF NO and change the sol id 3. In
How to Transfer an employee
authorizer ID put your branch user ID by
who is on deputation and
pressing F2. 4. Press F10
also need to assign him as
Head cashier
5. Then use HUPM menu option and change the
work class as 200
6. Use EFM menu option and put the head teller
flag "Y" and then press 10 and get it verified.

Please remove the existing Head cashier.

1. Use menu option EFM, function M, 2. Enter the
Assigned new Head Cashier to a
existing cashier PF no Press F4, 3. Change the Head
user, but at the time of creating
Teller flag as N Press F4-F10, 4. Verify the record
transaction getting message as
from another officer.
"No access to

535
cash account" 5. Create a transaction from new Head Cashier login

What is menu option to get 1. Use menu PTW 2. Option 13 - C (Cash waste
a back dated report of cash. report)
3. Enter the sol id and date range
Branch user wanted to
know, the procedure to
transfer funds in menu To transfer the funds follow the below mentioned steps :-
CASHTR. Please guide. 1. First Lodging branch do the following transaction
through TM menu for cash lodgment in cashtr a/c SOL
ID + CASHTR001 – Debit SOL ID + Teller -
Credit
2. Use menu option CASHTR and lodge funds for sending
branch which will pass transaction during verification of
CASHTR i.e. SOL ID + CASHTR001 -
Branch user mentioned that Debit (Lodging Branch) SOL ID + CASHTR001 -
we are unable to do the Credit (Receiving Branch)
verification of Cashtr 1. Use CASHTR menu option, 2. Function V to Verify, then
Ticket number. put ticket no, 3. Then by pressing F4 do the CTRL D, 4.
Again F4 the message as 'do you want to verify y/n put
the Y press F4

536
 22. Collection of Cheques / Instruments

22.1 Cheque Truncation System (CTS)

Cheque truncation is the process of eliminating the flow of physical cheque issued by a
drawer to the Drawee Branch. The physical cheques are truncated and electronic images
of the cheques are captured for processing. The physical cheques are retained at the
presenting bank itself. The captured image along with data is exchanged across the Banks.
Receiving payment based on an electronic image of truncated cheque:
 Legal status of the cheque transaction is derived from amendments made to the
Negotiable instrument Act, 1881 by virtue of Negotiable Instruments {Amendments
and Miscellaneous Provision) Act, 2002 whereby among others, the section 6,64,
81, 89 & 131 of the NI Act, 1881 are also suitably amended to incorporate the validity
of the truncated image of the cheque.
• Cheque truncation system- Section 131 of Negotiable Instrument Act 1881 (
Amendments)
• Onus of due diligence shifted to the presenting bank in CTS environment
It shall be the duty of the bank who receives payment based on an electronic
image of a truncated cheque held with him, to verify the prima facie
genuineness of the cheque to be truncated and any fraud, forgery or
tampering apparent on the face of the instrument that can be verified with
due diligence and ordinary care as per the guidelines of the NI Act 1881, as
amended from time to time.
 In view of the above amendment, the presenting bank takes responsibility for
exercise of due diligence. The branches while sending cheques to CTS Scanning
Center / Clearing Centre / Hub should ensure the following:
• To exercise due diligence on all instruments
• To check the apparent tenor of the instruments
• To ensure verification under Ultra Violet Lamp(UVL)
• To scrutinize the cheques for material alteration
• To ensure genuineness and validity of instruments
• To ensure that pay in slip is properly filled up with correct and complete
account number and name of the account holder
• To ensure that the complete account number is written on the back of the
cheque / instruments along with the mobile no. of the depositor.
 The scanning center/clearing center/hub while scanning the instruments should
inter-alia also ensures the following:
• To check the apparent tenor and genuineness of the instruments
• To ensure verification of instruments under Ultra Violet Lamp (ULV)
• To ensure that instrument confirms to features of CTS 2010 standard
• To ensure that physical feel of the instrument meets the usual paper standard
used for cheque.
537
 • To ensure that no material alteration visible to naked eye
 Our Branches issue only Payable at Par CTS Standard 2010 cheques to
Customers
22.2 One Nation One GRID
As per Reserve Bank of India (RBI) guidelines Cheque Truncation System (CTS) has
migrated from the earlier architecture of three Regional Grids to a Single National GRID
under the One Nation, One Grid project, three CTS grids are merged to create a single
grid for the nation. Single grid shall benefit customers with faster realization of outstation
cheques. Presently, Cheque Truncation System (CTS) is presently working at National
GRID (in Mumbai).

22.3 Process of clearing in National Grid (Mumbai)

i) Cheques presented for clearing at the above centers are treated as

instruments cleared under local clearing. The centers have been provided
with necessary hardware and software to take care of the cheque processing.
All other provisions of Uniform Rules and Regulations for Bankers' Clearing
House (URRBCH) issued by RBI are being adhered to by this centers.

ii) Now Bank is issuing cheques which comply with CTS-2010 standards only.

iii) Bank has stipulated the compensation at the rate of savings bank interest
rate for delay in clearance of local cheques beyond the normal period.

iv) Cheques that need to be represented without any recourse to the payee shall
be made in the immediate next presentation clearing not later than 24 hours
(excluding holidays) with due notification to the customers of such
presentation through SMS alert, email etc.

v) Cheque return charges shall be levied only in cases where the customer is at
fault and responsible for such return.

vi) The payment of compensation to the customers on account of delay in

collection of outstation cheques is to be paid to the customer without any
request from him (as per Compensation Policy).

vii) Bank need to mention the “Date of Return & Sign / Initial the Cheque Return
Memo and the objection slip giving therein a definite and valid reason for
refusing payment as prescribed in Rule 6 of the Uniform Regulations and Rules
for Bankers Clearing House (URRBCH). This will enable the holder of the
instrument to have legal recourse against the drawer of the cheque.

22.4 Non-CTS cheques: As per RBI extant guidelines, all banks providing cheque facility
to their customers have been advised to issue only “CTS-2010” standard cheques.
Cheques not complying with CTS-2010 standards will not be cleared through CTS clearing.
538
Accordingly, Bank do not issue any non-CTS cheques to the customers.

22.5 Collection of Third Party Cheques in clearing: RBI has prohibited Banks from
crediting 'account payee' cheques to the account of any person other than the payee
named therein. However, with a view to mitigate the difficulties faced by the members
of co-operative credit societies in collection of account payee cheques, RBI has permitted
banks to collect for such societies account payee cheques, drawn for an amount not
exceeding Rs. 50,000/- on behalf of their constituents.

22.6 Collection of Local Cheques :

a) All CTS Compliant Cheques and other Negotiable Instruments which are payable
under a grid system will be presented through the clearing system prevailing at the
Centre. Cheques deposited at branch counters and in collection boxes within the
branch premises before the specified cut-off time will be presented for clearing on
the same day. The broad time limit / cut –off time for presenting of clearing will be
decided by the respective branch head in consultation with Zonal Office based on
location of branch / practices, etc. However, such cut-off time limit will be clearly
indicated on cheque drop boxes located at branch premises.

b) Cheques deposited after the cut-off time and in collection boxes outside the branch
premises including off-site ATMs will be presented in the next clearing cycle. As a
policy, bank would give credit to the customer account on the day clearing
settlement takes place. Withdrawal of amounts so credited would be permitted as
per the cheque return schedule of the clearing house.

c) Bank branches situated at centers which are not members of any CTS Grid or where
no clearing house exists, would present local cheques on drawee banks across the
counter and it would be the bank’s endeavor to credit the proceeds at the earliest
but not later than 3rd working day from the date of deposit by customer.

22.6 Speed Clearing

In order to facilitate faster collection of outstation cheques, the Reserve Bank of India
started a special clearing called “Speed Clearing” by leveraging the core-banking-
solutions (CBS) implemented in Banks. Speed clearing refers to collection of outstation
cheques through the local clearing. It facilitates collection of cheques drawn on
outstation core-banking-enabled branches of banks, if they have a networked branch
locally.

Outstation cheques drawn on banks participating in speed clearing at Specified locations

will be collected and treated at par with local cheques. All terms and conditions applicable
for local clearing instruments will also apply to speed clearing.

539
Under grid-based Cheque Truncation System (CTS) clearing, all cheques drawn on bank
branches falling within in the grid jurisdiction are treated and cleared as local cheques.
Cheque collection charges including Speed Clearing Charges should not be levied if the
collecting bank and the paying bank are located within the jurisdiction of the same CTS
grid even though they are located in different cities.

The speed clearing process applicable to Outward and Inward Clearing at Speed Clearing
Centers is given below:

i) Outward Clearing: In all Speed Clearing Centres, al branches would accept cheques
drawn on upcountry CBS Branches of other Banks, alongwith local cheques deposited
by customers and present them in local clearing. Service Charges as stipulated by RBI
are levied.

ii) Inward Clearing: Under grid based CTS clearing, our Service Branches and other
branches at important centers will receive images of the cheques under inward clearing
and all these upcountry instruments will be treated as local cheques for clearing purpose.
No charges to be levied on these instruments.

22.7 Outstation Cheques

(a) Cheques drawn on other banks at outstation centers other than those covered under
local cheque, will normally be collected through bank’s branches at those centers. Where
the bank does not have a branch of its own, the instrument would be directly sent for
collection to the drawee bank or collected through a correspondent bank.
(b) Cheques drawn on bank’s own branches at outstation centers will be collected using
the inter-branch arrangements in vogue. Branches which are connected through a
centralized processing arrangement and are offering anywhere banking services to its
customers will provide same day credit to its customers in respect of outstation instruments
drawn on any of its branches in the CBS network if received in the branch up to specified
time and latest by next working day if deposited / dropped in collection box outside the
branch premises including the offsite ATMs.

22.8 Collection of foreign cheques/instruments

Cheques payable at foreign centres where the bank has branch operations (or banking
operations through a subsidiary, etc.) will be collected through that office. The services of
correspondent banks will be utilized in country / centres where the correspondent has
presence. Cheques drawn on foreign banks at centres where the bank or its
correspondents do not have direct presence will be sent direct to the drawee bank with
instructions to credit proceeds to the respective NOSTRO Account of the bank maintained
with one of the correspondent banks.
The time norms for collection and return of the instruments, varies from country to country
and place to place within the country where a ‘hold period’ is prescribed. The due date for
providing credit is calculated from date of notional credit in NOSTRO account plus the hold
period prescribed for the country.

540
Cooling / Hold Period
For USD cheques drawn on Banks in USA:
i. For cheques drawn on Banks in New York city area
(New York, Connecticut & New Jersey) : 7 New York business days

ii. For cheques drawn on USA but outside New York

city area : 11 New York business days
For EURO cheques drawn on Banks in various countries in European Union:
Country Hold period in working days
i. Germany 27 days
ii. Austria 27 days
iii. Belgium 12 days
iv. Spain 12 days
v. Ireland 14 days
vi. Italy 30 days
vii. Luxemburg 12 days
viii. Portugal 10 days
ix. Sweden 14 days
x. France 6 days
For GBP cheques drawn on Banks in UK: 9 UK working days
Note: These days are subject to revision from time to time depending upon the practices of
those countries.
The Bank may consider providing upfront credit by purchasing the instrument, if the
conduct of the account has been satisfactory in the past, for a charge at Bank’s sole
discretion.
The various articles as detailed in the International Chamber of Commerce, Uniform rules
for collection (ICC-522) will be applicable for collection of cheques. The Customer
instructing the Bank to perform services shall be bound by and liable to indemnify the Bank
against all obligations and responsibilities imposed by foreign laws and usages.
Customers depositing cheques drawn on foreign centers are expected to be aware of
usage / practices and laws related to cheques collection prevailing in drawee countries.
Suitable notice may be displayed at branches for this purpose.
The cheques sent for collection by the collecting Bank can be returned by the Banks
located in any foreign country (after their presentation in clearing/collection) due to fraud /
financial reasons. The fraudulent cheques can be returned by the Banks in Foreign
countries at any time after their presentation.
i) In case of returned cheques, no protection is available to the collecting Bank.
Since the Foreign Bank recovers the amount of returned cheques earlier credited
into account of collecting Bank by debiting its NOSTRO account, the collecting Bank
will not be able to provide any compensation to the depositor for cheques returned
on fraud / financial reasons.
ii) Further, the Bank has right to recover the proceeds of the cheques credited in
541
 depositor’s account (at the ruling exchange rate equivalent to foreign currency
amount debited by foreign bank to the NOSTRO account of the collecting Bank)
along with the interest from the date of credit of proceeds till the date on which
amount is recovered.

22.9 Immediate Credit of Local / Outstation Cheques / Instruments:

Branches / extension counters of the bank will consider providing immediate credit for
outstation cheques / instruments up to the aggregate value of Rs.15000/-tendered for
collection by individual account holder subject to satisfactory conduct of such account for
a period not less than 6 months. Immediate credit will be provided against such collection
instruments to the customer account. The credit given under this facility should not exceed
Rs.15000/- per customer at any given point of time. The facility of immediate credit would
also be made available in respect of local cheques at centres where no formal clearing
house exists.

The facility of immediate credit will be offered in Savings Bank / Current / Cash Credit /
Overdraft Accounts of the customers. For extending this facility there will not be any
separate stipulation of minimum balance in the account. Bank shall not decline to accept
outstation cheques deposited by its customers for collection.
Under this policy, prepaid instruments like Demand Drafts, Interest / Dividend Warrants of
other Banks shall be treated at par with cheques. In the event of dishonor of cheque against
which immediate credit was provided, interest shall be recoverable from the customer for
the period the bank remained out of funds at the rate applicable for clean overdraft limits
sanctioned for individual customers.
For the purpose of this Policy, a satisfactorily conducted account shall be the one, who
comply following guidelines -
a) Opened at least six months earlier and complying with KYC norms;
b) Conduct of which has been satisfactory and bank has not noticed any
irregular dealings;
c) Where no cheques / instruments, for which immediate credit was afforded,
returned unpaid for financial reasons;
d) Where the bank has not experienced any difficulty in recovery of any amount
advanced in the past including cheques returned after giving immediate
credit.
Bank shall levy normal collection charges and out of pocket expenses while providing
immediate credit against outstation instruments tendered for collection. Exchange charges
applicable for cheques purchase will not, however be charged.
The facility of immediate credit would not be applicable to cheques collected under Speed
Clearing arrangements.
22.10 Purchase of Local/Outstation Cheques
Bank may, at its sole discretion, purchase local / outstation cheque tendered for collection
at the specific request of the customer or as per prior arrangement. Besides satisfactory
conduct of account, the standing of the drawer of the cheque will also be a factor
542
considered while purchasing the cheque.

22.11 Time Frame for Collection of Local Cheques & Compensation

For Local Cheques presented in clearing credit will be afforded as on the date of settlement
of funds in clearing and the account holder will be allowed to withdraw funds on T+1 or
T+2 day as per return clearing norms in vogue at that Centre . For cheques and other
instruments sent for collection to centers within the country the following time norms shall
be applied -
(a) Cheques / Instruments drawn on one of our branch deposited at another center-
Same Day
(b) Cheques / Instruments drawn on other bank and sent for collection to:
i. Centers where our Bank have a branch: Maximum T + 6 days
ii. Centers where our Bank do not have a branch:
Centers Maximum Time Frame ( in Days)
State Capitals 7
Major Cities 10
Other Locations 14

As part of the compensation policy of the bank, the bank will pay interest to its customer
on the amount of collection instruments in case there is delay in giving credit beyond the
time period mentioned above. Such interest shall be paid without any demand from
customers in all types of accounts. There shall be no distinction between instruments
drawn on the bank’s own branches or on other banks for the purpose of payment of interest
on delayed collection.

Interest for delayed collection shall be paid at the following rates:

(a) Saving Bank Rate for the period of delay beyond 3 working days in case of local
cheques.
(b) Savings Bank rate for the period of delay beyond 7 days in collection of outstation
cheques payable at CTS Centers and 10 days in non CTS Centers.
(c) Where the delay is beyond 14 days interest will be paid at the rate applicable to
term deposit for the respective period.
(d) In case of extraordinary delay, i.e. delays exceeding 90 days interest will be paid at
the rate of 2% above the corresponding Term Deposit rate.
(e) In the event the proceeds of cheque under collection was to be credited to an
overdraft / loan account of the customer and credit is delayed beyond the time
period of three days for local cheque, seven days for outstation cheque payable at
CTS centers and ten days for non CTS centers, interest will be paid at the rate
applicable to the loan account. For extraordinary delays i.e. delay exceeding 90
days, interest will be paid at the rate of 2% above the rate applicable to the loan
account.

543
 (f) The interest will be paid only when such amount is Rs. 10/- or more.

22.12 Cheques /Instruments lost in transit/in clearing process or at paying

bank’s branch

In the event a cheque or an instrument accepted for collection is lost in transit in the
clearing process or at the paying bank’s branch, the bank shall immediately on coming to
know of such loss, bring the same to the notice of the account holder so that the account
holder can inform the drawer to record stop payment and also take care that cheques, if
any, issued by him / her are not dishonored due to non-credit of the amount of the lost
cheques / instruments. The bank would provide all assistance to the customer to obtain a
duplicate instrument from the drawer of the cheque.
In line with the compensation policy of the bank, the bank will compensate the account
holder in respect of instruments lost in transit in the following manner -
a) In case intimation regarding loss of instrument is conveyed to the customer beyond
the time limit stipulated for collection (3/7/10 days as the case may be) interest will
be paid for the period exceeding the stipulated collection period at the rates
specified above in para 22.11 of this chapter.
b) In addition, bank will pay interest on the amount of the cheque for a further period
of 15 days at Savings Bank rate to provide for likely further delay in obtaining
duplicate cheque/instrument and collection thereof.
c) The bank would also compensate the customer for any reasonable charges he/she
incurs in getting duplicate cheque/instrument upon production of receipt, in the
event the instrument is to be obtained from a bank/ institution who would charge a
fee for issue of duplicate instrument.
22.13 Force Majeure
The bank shall not be liable to compensate customers for delayed credit if some
unforeseen event (including but not limited to civil commotion, sabotage, lockout, strike or
other labour disturbances, accident, fires, natural disasters or other “Acts of God”, war,
pandemic , invocation of Disaster Management Act by Central / State/ District / Local
government / authorities, damage to the bank’s facilities or of its correspondent bank(s),
absence of the usual means of communication or all types of transportation, etc.) beyond
the control of the bank prevents it from performing its obligations within the specified
service delivery parameters.

22.14 Charging of Interest on cheques returned unpaid where instant Credit

was given

If a cheque sent for collection for which immediate credit was provided by the bank is
returned unpaid, the value of the cheque will be immediately debited to the account.
544
Interest where applicable would be charged on the notional overdrawn balances in the
account, had credit not been given initially.
If the proceeds of the cheque were credited to the Savings Bank Account and was not
withdrawn, the amount so credited will not qualify for payment of interest when the cheque
is returned unpaid. If proceeds were credited to an overdraft / cash credit / loan account,
interest shall be recovered at the rate of 2% above the interest rate applicable to the clean
overdraft / loan from the date of credit to the date of reversal of the entry to the extent the
bank was out of funds.
22.15 Service Charge

For all collection services the bank will recover appropriate service charges as decided by
the bank from time to time and communicated to customer as indicated in the code of
Bank’s Commitment to Customers adopted by the bank and by displaying on Bank’s
website.

22.16 Cheque deposit in Drop box / counter

Branches should put up a notice (in Hindi,English and in the regional language) near the
check drop box and on the Cashier's counter requesting customers to cross cheques
before tendering for collection in their accounts. Receiving cashier(s)/officials must
ensure that all cheques received for collection from customers are crossed before they
are accepted. A crossing stamp may be provided by the bank near the the check drop
box.
With the introduction of cheque drop box facility, customers can deposit cheques along
with paying-in slips in the box meant for this purpose. Timings for clearing cheques on
the same day should be clearly mentioned on the cheque drop box. The contents of the
cheque drop box should be taken out inside the banking hall in the presence of two
officials and the number of credit and debit instruments should be recorded in a
register/pass book meant for the purpose. A special crossing stamp should be placed
near the cheque drop box to enable the depositors affix the crossing stamps on payment
instruments in the drop box.
Branches should note that they should continue to accept cheques over the counter
when tendered by the customers and the counterfoil of the deposit slip duly stamped
and signed must be issued as an acknowledgement. Customers desirous of handing over
the cheques across the counter should not be directed to the cheque drop box as this
violates the guidelines issued by RBI and these cheques must be kept in a fire proof safe
overnight.

545
23. Clearing Module in CBS

Queries Solution
In outward clearing zone, If zone is released then it cannot be modified or deleted or
Branch has wrongly entered transferred. If zone is not released and regularized then do
certain instruments, which are as follows:-
in verified status. How to
rectify? i. Use the menu option HMCLZOH & open a new zone with
same zone code but next date. ii. Then use the menu option
TROFSETS function "T" and enter the set number details
which need to be deleted, then enter the details for new zone
in which you have to transfer the set and press F4 and then
F10, this will give new Set Number which will be in
"Unverified" status. iii. Use the menu option HOCTM, enter
the new zone details and delete the new Set Number.

One cheque was wrongly If Clearing Zone is Posted and transaction is in Entered status
entered twice in HICTM menu. due to an exception then, Proxy post transaction and reverse
How to do the deletion of the proxy to Netclear a/c or if shortfall is there then reverse to
cheque? shortfall a/c If Clearing Zone is not posted then,

i. Use the menu option HICTM function will be D enter the

Zone number press F4. ii. Enter the cheque number which
you want to delete. Press F4. iii. Select one record for
deletion by Shift+F4 and press F10.

546
While marking outward i. Use menu option HMCLZOH enter the outward
rejection from inward clearing clearing zone details and note down the transaction
zone, getting error as "all part Number. ii. Use the menu option TM and enter the
transactions are not verified". transaction number by using function M and verify the
What to do? pending part transactions and press F10. iii. Use the
menu option HICTM and mark the outward clearing
rejections entry. This is due to account not having
sufficient balance so the system gives the error. If
branch want to pass this cheque then TOD is required.
To give TOD do as follows;

While posting the inward i. Under menu option HTM use function code M, enter
clearing transaction getting the transaction number and press F4 you will get TOD
error as "sufficient debit notscreen. ii. Select GRANT TOD option in HTM Menu. iii.
posted scheme update failed" Press F4 & enter the user id in "permitted by" field then
What is the solution? press F4 and F10.
i.Menu option ACSBIO can be used Also use the menu
In one of the accounts, some option HACM function "I" enter the account number and
amount is showing in funds in press F4, give option M and press F4 again. Press Ctrl+E
clearing. How to know the on "funds in clearing" field, will display the outward
detail and how to regularize? clearing zone details. Use the menu option HMCLZOH
and regularize the zone. ii. Use menu option HOIQ
enter customer account number press F4. Find
instrument status with “ Released to shadow balance “
Check NPCI Settlement Reports and Regularize the
Tallied zones Through HMCLZOH menu. ( Done by
Service Branch).

While releasing outward To unlock the Zone, please use menu option UNLKZ,
clearing zone system gives function U for unlock, enter the zone number and date
message as "Zone is Locked press F4 and F10, Check the status and release the
try after some time". zone.

While releasing the outward It needs to check whether all instruments entered in
clearing zone get an error Zone are verified. i. Use menu option HOIQ, enter the
"Can't release to shadow zone date, zone number & verified status flag as N Press
balance unless all part F4. ii. Check the unverified set number and verify the
transactions are posted". same from HOCTM menu option. iii. Release the zone
from HMCLZOH menu option.

547
Due to technical problem for For marking pending release for given bank or branch. i.
Use menu option
some bank returns are late MARKPEND. ii. Enter the zone number, zone Date, zone
but want to release zone SOL ID, zone bank code, zone Branch code (If for
excluding those bank or specific branch). iii. Press F4. iv. Select record by Shift
branches. + F4 and press F10.

What is the menu option for

revoke pending instrument in To revoke pending release for given bank or branch,
outward clearing? follow the below steps:-
i. Use menu option HREVPEND. ii. Enter the Zone No,
Zone Date, Zone SOL ID, Zone bank code, zone Branch
code (If for specific branch). iii. Press F4. Select record
by shift + F4 and press F10.

Use PTW and generate the clearing report and cross-

check the transactions or use FTI / FTR to check for
particular amount by giving transaction-type as L-
Clearing and transaction amount low and transaction
amount high. Check for un posted transaction. Use
Clearing is not balanced OWCTS menu option 2 & 3.
which reports should be taken
to cross-check the entries.
This error comes due to wrong MICR code added in
HOCTM which is not available in system. Log a call in
helpdesk for necessary update. After updating record,
modify sort code for given number.
In OCTM verification an
error comes "BCT record not
found".
24. Clearing Difference Receivable/ Payable Account

24.1 There could be occasions of short receipt / excess receipt of instruments in a day's
inward clearing received by the clearing branches from their Main / Service Branch. For
accounting / cash-book balancing purpose, the clearing branches are required to pass
one or more 'adjustment vouchers' that take care of the differences.
24.2 The above type of vouchers are generally passed to the debit / credit of Clearing
Difference Adjustment Account, depending on the nature of short receipt / excess
receipt. Subsequently, when the short / excess receipts are recovered / paid the

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branches reconcile the initial entries in the Clearing Difference Adjustment Account by
passing corresponding 'adjustment vouchers'.

24.3 Inward Clearing Instruments are received by the Main / Service Branch from the
Reserve Bank of India or the Bank conducting clearing and these are now posted
centrally at the main branch or the service branch. In case any over-limit / overdraft is
required to be allowed in accounts where payment of cheques received in inward clearing
results in excess drawing over the available balance, turn are sent to the concerned
branches duly listed and accounted for under a Debit Note or through the Net Clear
Document (at centres where Net Clear system is introduced) by the Main / Service
Branch. Inward Clearing Instruments received from the Main / Service Branch should be
physically counted and called over with the schedules / sheets listing the amounts.
Branches should balance its day's inward clearing on a daily basis. For excess receipt or
short receipt necessary adjustment vouchers should be passed.

24.4 A. Clearing Differences could arise due to the following items

i. Items listed but not delivered (LBNR)

ii. Items delivered but not listed (RBNL)
iii. Encoding errors :-
a) Encoded less
b) Encoded more
iv. Casting errors

(the list is illustrative and not exhaustive)

(B) Whenever such differences arise the Branches should take the following
action

(i) Items listed but not delivered (LBNR):

Advise the Main / Service Branch of the item listed but not delivered along
with a Xerox copy of the schedule / sheet marking off therein the item not
received. At MICR Centres where the sheet is exhaustive the details of the
cheque number are available -necessary earmarking of the cheque
amount should be made in the account and in case the balance is short
necessary telephonic intimation should be given to the presenting Bank -
Branch about non-receipt and return of the cheque.

(ii) Items delivered but not listed (RBNL):

Advise the Main / Service Branch of the cheque that has been delivered
but not listed and forward a xerox copy of the cheque (both sides) to

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 enable the Main / Service Branch to ascertain the presenting Bank -
Branch. In case the cheque pertains to some other branch and is also not
listed, the drawee branch should be contacted and the cheque forwarded
to them through the Main / Service Branch with a small covering letter but
not under a return memo as the cheque is not listed.
Funds are released to respective SOLID SUNCR161.

(iii) Encoding Errors:

Encoding errors can arise only at MICR Centres. Any encoding error in
inward clearing received at a branch can be a valid technical reason for
return of cheques/ instruments. However, when returning, it should be
ensured that the return memo is prepared for the amount encoded, (and
not the amount of the cheque) since it is this amount that is listed. The
correct amount of the cheque may be noted in pencil within brackets for
the sake of clarity.

(iv) Casting Errors:

Errors in casting detected in the sheets / schedules received should be

immediately informed to the Main / Service Branch together with the xerox
copy of the sheet/schedule.

(C) The adjustment vouchers on account of the above differences should be

passed to two different accounts in the General Ledger Balance Book viz. GL
Clearing Difference Receivable Account for debit entries (receivable differences
to appear on the Asset side) and GL Clearing Difference Payable Account for
credit entries (payable differences to appear on the liability side). These
vouchers, whether debit or credit, should be signed by two officials-the Cashier
/ Official-in-charge of clearing and the Manager (Small / Medium Branch) / Branch
Manager / Senior Manager as the case may be. The Manager (Small / Medium
Branch) Deputy Manager / Branch Manager should ensure that the steps
enumerated in (B) above are taken and check the posting of this voucher in the
G/L Clearing Difference Receivable/Payable Accounts.

(D) All the particulars of the difference vouchers should be entered in the Clearing
Difference Register with full particulars like date, cheque no., presenting bank etc.
A format of the Clearing Difference Register is given in Appendix XI. The first half
of the register may be used for receivable differences i.e. debit entries passed in
Clearing Difference Receivable Account and the balance half may be used for
payable difference i.e. credit entries passed in the GL Clearing Difference Payable
Account. The debit entries in this Register represent amount receivable from other
banks and credit entries represent
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 amount payable to other banks. The individual entries in the Clearing Difference
Receivable / Payable Account should be followed up for speedy settlement within
a reasonable time - maximum one month. The settlement vouchers to the
Clearing Difference Receivable / Payable Account should also be signed as above
i.e. Cashier / Official-in-charge of clearing and the Manager (Small / Medium
Branch) / Branch Manager / Senior Manager as the case may be and entered in
the Clearing Difference Register. The relevant entries in the Register should be
marked off upon settlement. Every month, on the last day, the total amount of
outstanding (un 'p' marked) entries in the 'Receivable' Section (first half) of the
Clearing Control Register should be jotted and balanced with the outstanding in
the GL Clearing Difference Receivable Account and those outstanding (un 'p'
marked) entries in the 'Payable' Section (second part) of the Clearing Difference
Register should be jotted and balanced with the outstanding in the GL Clearing
Difference Payable Account. Maintenance of the Clearing Difference Register will
also enable correct reporting of receivable / payable figures in the Long Form
Audit Report and quarterly reporting to Zonal Offices.

24.5 Hitherto, all clearing differences were maintained by Branches in the G/L Clearing
Difference Adjustment Account. These differences have been mounting over the years
and hence require to be monitored carefully, as it is a fraud prone area. As per directives
from Reserve Bank of India, old clearing differences prior to 1.4.1994 only should be
kept in the G/L Clearing Difference Adjustment Account (a blocked account). Clearing
Differences subsequent to 1.4.1994 should be segregated as receivable / payable
differences and maintained in separate accounts in the GLB viz. G/L Clearing Difference
Receivable Account (debit entries) and G/L Clearing Difference Payable Account (credit
entries) with individual entry wise details in the Clearing Difference Register.

24.6 The balancing of the Clearing Difference Register should be reported to the
Controlling Authority in the Branch Performance Report. The details of all clearing
differences receivable / payable should also to be reported by Branches to their Zonal
Offices, every quarter, who in turn should report a consolidated position to General
Operations Department, Head Office. Inspecting officials of Zonal Offices during their
visit to branches should verify maintenance of the Register / Accounts as mentioned
above.

24.7 It should be carefully noted that passing of such 'adjustment vouchers' to the
Clearing Difference Receivable / Payable Account involves a great amount of risk and
hence it is the responsibility of the Manager / Branch Manager / Senior Manager at
branches to take utmost care in passing such vouchers. It should hence be strictly
ensured that all such vouchers for the Clearing Difference Receivable / Payable Account
are prepared after thoroughly checking the inward clearing sheets /

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Instruments and should be signed by two officials - the Cashier / Official in charge of
clearing jointly with the Manager (Small Medium Branch) / Manager / Senior Manager.

25. Endorsements on Cheques by Clearing Banks:

25.1 The Clearing Houses operating in the country are required to adopt Uniform Rules
and Regulations governing the conduct of the Clearing House operations on the lines of
the draft given by the Reserve Bank of India. The respective Service Branches / Main
Branches of the Bank attending the clearing house would advise Branches participating
in the Local Clearing House about adoption of the set of Rules and Regulations by the
Clearing House.

25.2 Under the Uniform Rules and Regulations, a Clearing House stamp (known as
'Clearing Stamp') of a member bank (or sub-member) affixed on the face of the
document shall denote and mean discharge by endorsement by such member (or sub-
member):

(i) when the document is made payable to a member bank (or sub-member)
A/c. A.B.C. or,

(ii) document is made payable to a member (or sub-member) or

(iii) in case of a document requiring a certificate or other endorsement in one or
other of the forms mentioned below:

(a) Received Payment

(b) Received Payment
Payee's Account Credited
(c) Received Payment
First Payee's endorsement guaranteed
Second Payee's Account Credited
(d) Received Payment
Second Payee's Account Credited
(e) Received Payment
Collection Bank's confirmation guaranteed
(f) Received Payment
Endorsements confirmed.

All endorsements other than those mentioned above will be required to be discharged
manually as hitherto

Note : For the purpose of these rules, 'documents' include, besides cheques, banker's
demand drafts, dividend warrants, pay orders, Indian Postal Orders and Bills accepted

552
payable at a member bank and due on date of Clearing, but does not include coupons
and banker's fixed deposit receipts.

25.3 Once the revised set of uniform rules and regulations is passed by the Local
Clearing House, participating Branches will not be required to put rubber stamp
endorsements on the instruments received for clearing. Consequently, the Clearing
House stamp at a Branch would become very important. Branches should meticulously
follow the procedure given below in regard to safe custody and affixing of the clearing
house stamp:

(i) Clearing House stamp/s to be used for Clearing Instruments should, as usual,
be kept at all times in safe custody of the concerned official of the Clearing
Department;

(ii) Proper record should be maintained by Branches about custody of the

Clearing House Stamp. A pass book should be maintained by the Clearing
Department indicating the name of the official and also his signature in token
of his receipt of the Clearing House Stamp for the day's use;

(iii) Clearing House Stamp should be affixed on the documents after verifying that
documents/ endorsements are regular in all respects and are correctly made.
The relative credit vouchers for such clearing documents should be initialed /
signed by the official who has verified the documents.

25.4 Branches should note the important changes made under the revised Rules and
Regulations and follow them when adopted by the Local Clearing House and informed
by the Service Branch/ Main Branch.

25.5 At centres where MICR technology is in operation, Banks are required to send
local cheques, duly encoded with amount and other numerical fields on the code line
to the Data Processing Centre, Reserve Bank of India for clearance. The encoding of
the cheques is done on the encoder machine. Banks have been advised by RBI that
rubber stamp endorsement/clearing stamp, on the face of the cheques to be processed
at Data Processing Centres, are not required as the same can be done on the reverse
of the cheques by the encoders while encoding the cheques. This endorsement called
the variable line endorsement, will be affixed by the encoder machine on the back of
the instrument, printed in MICR format and shall denote and mean discharge by
endorsement.

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26. Affixing Crossing and Clearing Rubber stamps on the Clearing Instruments

'Crossing' on the face of the instrument and 'Clearing' rubber stamps on the back of
the clearing instruments should be affixed in such a manner so as not to
obliterate/deface the important particulars such as name of the beneficiary, date and
amount etc.

27. Membership of Clearing Houses

27.1 Branches opened at centers already having Clearing House should take all relevant
factors into consideration and promptly put up a proposal to become member / sub-
member of the Clearing House. Membership / sub-membership of the Clearing House
confers many advantages and leads to better customer service.

27.2 Certain centers may not have Clearing House. At some of these centers where
more than three banks function, it would be useful to establish Clearing House to speed
up clearance of local cheques. For this purpose, the local branch of the State Bank of
India may arrange for meetings of representatives of all banks to consider proposal for
establishment of a Clearing House at the Centre. Branches of our Bank should attend
such meetings and extend full co-operation in considering the proposal. They should
promptly submit specific recommendations to their. Regional Offices/Zonal Offices for
approval to become member/sub-member of the proposed Clearing House.
27.3 In terms of the Clearing House Rules, the member banks are required to maintain
minimum balance in their current account with RBI/SBI. In case any member bank fails
to maintain the minimum balance or in case of an overdraft on account of adverse
clearing position, such defaulting member Bank shall be liable to pay penal interest till
the minimum balance position or debit position is regularized. Defaulting member banks
shall also be liable to have their membership terminated.

27.4 Member banks should ensure adherence to the regulations and rules adopted by
the Clearing House and in case of certain problems faced by them, they may seek relief
from the application of the relevant rules from the President of the Clearing House or
consider withdrawing from participation in Clearing House operations, pending
restoration of normalcy in the Bank as provided for in the Clearing House Regulations
and Rules.

27.5 Member banks should ensure that they send to the Clearing House such
representatives as will deal (exchange instruments) with the representatives of all
members of the Clearing House. If necessary, feasibility of sending an officer to the
Clearing House may be considered, if warranted. There should also be periodical rotating
of representatives and regular check of their work. Whenever such instances like
suspension of work by any representative boycotting or refusing to deal with all members
present at the Clearing House (in such an event the President of the Clearing House has
power to suspend the Clearing House)

(i) ragging and extortion of money from new representatives occur, Branches
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 should promptly intimate higher Controlling Authority so as to ensure that
prompt action is taken to avoid recurrence of such incidents.

28. Procedure at Local branches

i) Enter the Bar amount received from clearing house / service branches by modifying
bar number and date and number of instruments for the zone number ‘06’ and total
amount through ‘HMICZ’ using modify option ‘M’.

ii) Run the validation report through ‘HMICZ’ option ‘V’. The report will be generated
at Background. The report can be viewed or printed using Background menu. The
report gives all the exceptions, if any in the account where the posting has taken
place.

iii) By using ‘M’ option in HICTM, the user has to modify the details like ‘Beneficiary
Name’, ‘Date of Instrument’ for all the instruments. The User can also grant TOD by
pressing <F7>. If the user has to return the instrument, he can choose reject option
‘I’ and press <F6>.

Important: The upload program is meant to facilitate the branch of entering the
individual instrument. It will be the responsibility of the Branch to physically verify the
instruments uploaded / modified, wherever necessary / reject as per Bank’s norms.
Verification of signature / apparent tenor of the instrument shall be the sole
responsibility of the branch. Similarly taking decision on the passing of the cheque or
not for financial reasons shall also be the sole responsibility of the parent branch.

29. MISCELLANEOUS

Cheques which are deposited with wrong account number mentioned on the Pay-in slip,
Bank will return such cheques to the customers on the address mentioned within 48
working hours However in cases with incomplete address, incomplete phone no., no
phone number mentioned on the Pay-in slip, the bank will be responsible to keep these
instruments for a maximum period of 3 months.

Cheques received back unpaid will be returned by post/ courier etc. to the customer within
48 working hours on the address recorded in Bank’s database. However, these will be
kept in the Bank for returning to the customer over the counter if he/she makes a request
for the same. If not collected by the customer within 15 days bank will send them back at
the recorded address by post or courier.
The list of objections for return of Instruments and Image based Cheque Clearing, as
555
detailed in Annexure D of Uniform Regulations and Rules for Bankers’ Clearing House of
RBI, has been placed as Annexure-4 of this document.
Cheque return charges shall be levied only in cases where the customer is at fault and is
responsible for such returns. The list of reasons for return, where the customers are not
at fault are indicated in the Annexure-5.
Cheques that need to be represented without any recourse to the payee, shall be made
in the immediate next presentation clearing not later than 24 hours (excluding holidays)
with due notification to the customers of such presentation through SMS alert, email etc.

A remittance in cash for credit of the Branch account with another bank should be made
after the relative debit voucher is passed by the cashier and the Manager. A member of
Cash Department who carries the cash remittance should sign on the back of the debit
voucher in token of his having verified and received cash. He should be accompanied by
a sepoy or an armed guard as may be considered proper.

30 Positive Pay System (PPS)

30.1 With a view to prevent fraud, Positive Pay System has been introduced by RBI vide
letter No. RBI: 2020-21:41 DPSS.CO.RPPD No 309:04.07.005:2020-21 dated 25.09.2020.
Accordingly, our Bank has implemented Positive Pay System from 01.01.2021. Positive
Pay System involves a process of validating key details of large value cheques of
Rs.50000/- and above. The positive pay has been introduced to prevent the frauds and
making the payment of cheque secure under CTS process. As availing of PPS facility is at
the discretion of the account holder, cheque presented in CTS clearing for amount
Rs.50,000/- and above shall not be returned due to non-submission of PPS Mandate.
30.2 Mandatory Positive Pay: To augment customer safety in cheque payments and
reduce instances of fraud occurring on account of tampering of cheque leaves, Bank has
made Positive Pay mandatory for cheques of Rs.5,00,000/- and above presented in CTS
Clearing w.e.f 01.01.2022. i.e. if issuer of the cheque does not provide cheque details for
cheque presented in CTS Clearing within the stipulated timeline, then his/her cheque shall
be returned under reason code “70” with reason “Advice not Received”.
30.3 Channels for Providing Positive Pay Mandate: The following Channels can be
used by the customer for reconfirmation of cheque under Positive Pay:
 FINACLE menu “PPS” (By submitting Branch Requisition Slip at Home Branch)
 BOI Internet Banking
 Mobile Banking ( BOI Mobile App)
 SMS ( by sending SMS to VMN : 7669300024 from registered mobile number)
30.4 Positive Pay Mandate submitted upto stipulated timeline through any channel / mode
will be processed for the next clearing session. Afterwards, all the confirmations will be
processed for subsequent clearing session.
30.5 Positive Pay Mandate through Branches can be provided during the normal business
556
hours of the respective Branch. Rest all the modes / channels will be available 24&7 hours
to provide the Positive Pay Mandate.
31. New Security Feature in Cheque - ALPHANUMERIC CODE
Looking at the increasing trend of cheque-related fraud cases in the last few years and in
order to curb it, the bank has introduced a new security feature in cheques i.e.
ALPHANUMERIC CODE w.e.f 17.09.2022. As per this, the system prompts for an
Alphanumeric Code for passing cheques at Branches. At present validation of
Alphanumeric code printed in leaves of the New Series Cheque Book with the Finacle
system is available for cheque presented for cash payment over the counter, transfer of
funds within the bank branches and transfer funds to other Banks through RTGS/NEFT.
This module is stabilized and effective in curtailing cheque-related frauds to a large extent.
Branches are advised to sensitize customers to use of New Series Cheque Book has an
enhanced feature of Alphanumeric Code by replacing the Old Series Cheque Book, so that
consequent loss of frauds using leaves of Old Series Cheque Book can be averted.
A notice in this regard is to be displayed on the Notice Board or any prominent place inside
the branch premises to attract the immediate attention of the customers.

32.Bank's account with Reserve Bank of India, State Bank of India or Other
Banks

32.1 Branches should not open an account with another bank without the prior approval
of Controlling Office. Head Office does not ordinarily wish that Branches should maintain
an account with any bank other than the Reserve Bank of India or the State Bank of
India. If Branches desire to maintain accounts with other banks, they should write to
Zonal Office giving reasons therefor.

32.2 Arrangement should be made to obtain a daily statement of account from banks
with whom the Branch maintains operative accounts. It should be arranged that the
statement of account must be delivered direct to the Manager who should personally
scrutinise each entry of the statement. He should particularly see that the dates of
entries for cash transactions in the statement always agree with the dates in the ledger
account of the bank maintained by the Branch. Branches should insist for internet
banking account (View facility only).

32.3 Reconciliation of the Branch account with the Reserve Bank of India/State Bank of
India must be made daily. Accounts with other banks where there are infrequent
operations should be reconciled as often as appropriate; the Manager should take out
reconciliations on surprise dates. In addition, Branches must reconcile their accounts
with the Reserve Bank of India/State Bank of India or other bank(s) as on the last day
of each month. The reconciliation should be made in the ledger account or in a special
Reconciliation Book, but not on loose sheets of paper. The reconciliation should be
checked and signed by the Manager and the cashier. If the entries in the statement of
557
accounts are wrong or subject to query in any way, they must be followed up
immediately and satisfactory explanations obtained.

32.4 The Manager must satisfy himself about the correctness of the Branch accounts
with other banks by periodically obtaining certificates of balance of such accounts.

33 Deposit of Cash and Cheques in Accounts with Other Banks

33.1 A remittance in cash for credit of the Branch account with another bank should be
made after the relative debit voucher is passed by the cashier and the Manager. A
member of Cash Department who carries the cash remittance should sign on the back
of the debit voucher in token of his having verified and received cash. He should be
accompanied by a sepoy or an armed guard as may be considered proper.

33.2 The paying-in-slip for cash / cheques remitted for deposit with another bank should
be made out by Cash Department and signed on both the portions by the cashier and
initialed by the Manager. The debit voucher evidencing the remittance of cash/cheques
for credit of the Branch account with another bank must be kept by the Manager with
himself and released for posting in the Cash Book only after he has verified it with the
receipted counterfoil of the relative paying-in-slip. The Manager should check and initial
the debit entry in the ledger account.

33.3 The Branch Manager / Manager / Senior Manager of a Branch should ensure about
lodgment of cash with the Reserve Bank of India, State Bank of India or other Bank by
verifying the counterfoil of the relative paying-in-slip immediately on return of the cashier
to the Branch or latest by evening at the time of checking cash.

34 Withdrawal of Cash from Accounts with Other Banks

34.1 The cheque book of the Reserve Bank of India / State Bank of India or other Bank
must remain in the joint custody of the Branch Manager or the Manager and the cashier
of the Branch. Before drawing a cheque on the Branch account with the Reserve Bank
of India / State Bank of India or other Bank, a credit voucher for the amount must be
prepared by the Cash Department and signed in full by both the cashier and the
Manager. This credit voucher should be retained by the Manager / Deputy Manager till
cash is brought from the Reserve Bank of India/State Bank of India or other Bank. The
cheque should be signed jointly by the Manager or the Deputy Manager and the cashier,
as authorized.

34.2 The correct practice for drawing a cheque for withdrawal of cash from the Branch
account with the Reserve Bank of India / State Bank of India or other Bank is to draw it
payable to "Ourselves or order" and to discharge it on the reverse by two authorised
officials jointly. The cheque(s) duly discharged should be accompanied by a covering
558
memorandum addressed to the drawee bank requesting to pay the amount of the
cheque(s) to the deputed staff named therein. The Memorandum should be signed by
the Branch Manager and Manager and the signature of the member of the staff to be
deputed should be appended to the memorandum.

34.3 Cash should be brought by a member of Cash Department who should be

accompanied by a sepoy or an armed guard as may be considered proper.
34.4 Account with State Bank of India / Other Bank: Banks are not allowed to
issue cheques on their account with State Bank of India / Other Bank in favour of "third
parties." Such accounts are maintained for the use of the Bank's own requirements. If,
in a particular case it becomes necessary to issue such cheques, Branches should advise
State Bank of India / Other Bank by a separate letter as in the case of issue of a demand
draft on a correspondent bank.

35. Deposit and Exchange of Notes and Coins at Reserve Bank of India /
Branches of the State Bank of India or Government Treasuries

35.1 As far as possible, currency notes should be sorted out into issuable and non-
issuable notes and bundled separately, before the remittance is sent to an office of the
Reserve Bank of India or a branch of the State Bank of India or its associates or the
Government Treasury for credit of the Bank's account or for the exchange or conversion
of notes. (Non-issuable currency notes are those which are soiled and dirty as to be unfit
for further circulation).

35.2 Branches should confirm strictly to the arrangements, if any, made by the Reserve
Bank of India / State Bank of India or its associates for receiving such remittances on
specified days in a week.

36 Sorting of Currency Notes

In order to facilitate quick and efficient handling of cash tendered by Branches for
credit of their account with the Reserve Bank of India, the following measures must be
taken:

(a) Branches should sort out notes of all denominations and tender at the
Reserve Bank of India only non - issuable notes made into packets, size-wise.
Cut, defective, torn, mutilated notes, should not be put in packets of non -
issuable notes but lodged separately.
(b) In case re-issuable notes are also required to be tendered by the Branch,
packets of such re-issuable notes should bear distinctive colored labels (with
the name of the Bank clearly written thereon) to distinguish them from the
non - issuable note packets.

(c) The Branches should accept their own re-issuable notes held by the Reserve
559
 Bank of India under guarantee, in payment of their cheques to the maximum
extent, only the balance being issued in fresh notes.
(d) The proportion of fresh notes will be restricted by the Reserve Bank of India
to 25%, the balance being met from the guarantee note balances held by the
Reserve Bank of India on behalf of the concerned Branch.

Note: The procedure for sorting and tendering of cash with the Reserve Bank of India
may also be followed by Branches with advantage in respect of cash lodged with the
State Bank of India.

37. Monthly Surprise Check of Branch Cash

37.1 The joint Custodian of cash should make a surprise check of the entire cash held
in the Till/Vault periodically, but at least once a month. A remark to this effect should be
made in the Daily Cash Balance Book under the signature of the Joint Custodian.

37.2 Checking ought to be a surprise and should not be known or anticipated by the
cashier or his assistants. All cash (all currency notes and coins) should be kept out of
the cash safe or strong room by sepoys in the presence of the cashier and his assistants.
Where there is an assistant cashier(s), the cashier should not handle cash whatever; the
assistant cashier should produce the currency notes and coins to the officer checking
cash.

37.3 Currency notes of large denominations should be counted first. If there are more
than 12 packets of currency notes of Rs. 100/- denomination (a packet contains 100
pieces of currency notes), the number of packets should be counted; thereafter all the
pieces of currency notes of about six packets should be counted; a similar procedure
should be adopted for the packets of currency notes containing denominations of less
than Rs. 100/-. All odd lots of currency notes should also be counted.

37.4 All bags of coins should be opened and where there are more than six bags of
rupees (each bag purporting to contain Rs. 2,000/- the entire contents of at least three
bags out of six should be counted. All bags containing less than Rs. 2,000/- should be
opened, emptied and the contents counted. Small coins should be taken out from the
bags and examined; the contents of some bags should be counted. It is important to
ensure that the currency notes are correctly listed in the Daily Cash Balance Book (Form
Cash 1075). The number of pieces of each denomination should be entered in the space
provided. If this is not done properly, an explanation should be called for from the cashier
and if the explanation is not found satisfactory, the matter reported to Head Office.

37.5 When counting currency notes and coins, the checking officer should be able to
detect counterfeit notes and coins. If any chit, I.O.U., or other memorandum are found
in cash, a report should be made to Head Office.

37.6 The above suggestions are in the nature of minimum requirements; they are not

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to be regarded either as curtailment of the responsibilities or liability of the checking
officer counting cash or preventing him (the checking officer) from exercising his general
discretion.

37.7 It is of importance that the surprise checking of cash should not interfere with the
course of Bank's business and the customers should not be put to inconvenience. Cash
may be checked in the morning before the commencement of business or in the evening
after the close of business (after the daily Cash Balance Book has been written and
signed by the cashier).

37.8 Cash on hand must be checked by the Manager at the close of business of the last
working day of each half-year and a report of the checking should be sent to Head Office
on Form BPR-6. At Branches where the half yearly accounts are audited by the local
Auditors, the Manager of such Branches may not check cash at the close of the last
working day since cash will be checked by the Auditors, as a part of their duty.

38. Verification by Officers Unconnected with Custody of Cash

Apart from the daily check of cash and surprise check of cash at least once a month, the
entire cash in a Branch Till/Vault should be verified once in six months by an official
unconnected with custody of cash. The Controlling Authority should draw up a
programme of verification of cash under this system and ensure that it is executed
properly.

39 Surprise Check of Cash in Currency Chests

Procedure has been detailed in the Manual on Currency Chests circulated as an

enclosure to Circular Letter No. 2009-10/254 dated 24.02.2010. Branches may refer to
the procedure indicated therein.

40 Collection of Mutilated Currency Notes

Collection of mutilated currency notes should be done through our currency

chest branches and no branch should send such notes directly to RBI Issue Department
either at their Central Office or its Regional Offices. For details refer para no. 17 above.

41 Detection of Counterfeit Banknotes Revised procedure for Reporting

RBI has now advised that all cases of detection of counterfeit notes at the bank
branches/treasuries are promptly reported to the police authorities, it has been decided
to revise the procedure to be followed on detection of counterfeit banknotes at bank
branches, treasuries and sub treasuries. Accordingly, the following procedure should be
adopted with immediate effect. For details please refer para no. 16.4 above.
561
42. Safe Custody of Keys of Safes/Strong Room etc.

42.1 All employees of the Bank entrusted with the Bank's keys should take proper care
of the keys at all times, ensure that the principle of "Dual Control" is always maintained
and that the keys are not handed over or made accessible to any unauthorized person.

42.2 The purpose of maintaining dual control of the cash safe keys is that no official
singly can open the cash safe during the working hours. When the official entrusted with
the Bank's keys desires to proceed on leave, he needs to hand over the charge of keys
held by him to another authorized official by making appropriate entries in the daily cash
balance book (Form Cash 1075) and in the pass book maintained for recording the
number of keys handed over/taken over with date and the signatures of the concerned
officials. However, under the emergent circumstances, when the concerned
official/authorized clerk holding charge of the keys of the cash safe is unable to attend
the office for the reasons beyond his control, the keys of the cash safe should be handed
over in the following manner:

(a) The employee should contact the Manager/Deputy Manager on telephone at

the latter's residence or office and request him to depute an authorized staff
member to his place for collecting keys in person. The employee should hand
over the keys to this authorized staff member in a sealed cover, with signature
put across the sealed portion as a precautionary measure.

(b) The employee should send the keys of the cash safe in a sealed cover with
signatures put across the sealed portion as a precautionary measure through
the spouse or the nearest blood relative.

The Branch Manager/ Manager while accepting the keys of the Cash safe received from
the employee concerned in absentia should open the sealed cover in the presence of an
officer, preferably from Cash Department and make a separate note in the Daily Cash
Balance Book and the pass book as stated above.

42.3 The employees should have Bank's keys attached to their person by means of a
key chain and the keys should be preferably carried in a closed wallet which may be
purchased at the Bank's cost at a reasonable price to the debit of Profit & Loss Account
- Miscellaneous Charges. Due care should be taken to supply key pouches / chains to
the concerned staff members and also to replace regularly old key pouches/chains,
etc.

42.4 Serious notice will be taken of lapses in this regard. These are elementary
precautions and must be taken without exception. Any incident of loss of keys should be
reported immediately to the concerned department at Head Office as well as to Personnel
Department giving the full facts to enable Head Office to assess the degree of negligence
562
of the concerned staff member(s) and deal with it appropriately.

42.5 It is desirable to put into use periodically the duplicate keys; it is possible that while
the keys in use would definitely operate the locks, the unused keys may not. Due to
constant use, the keys as well as levers of locks wear out and it may happen that while
the keys in use would definitely operate the locks the duplicate set of keys when taken
out in emergent circumstances may not operate. It is, therefore, necessary to
interchange the two sets of keys once every year in turn, so that, both sets of keys
undergo similar wearing out process.

42.6 Notings about the passbook recording keys handed over / taken over by different
officials should be made in the Branch Documents Register at the appropriate place.

43. Duplicate Keys of Safes

43.1 Duplicate keys of safes of cash and securities, safe deposit vault and strong room
- must under no circumstances be left in the Branch safes themselves. They should be
lodged in safe custody with another bank / Branch in the following manner even before
the Cash Safe, Safe Deposit Vault and / or Strong Room are put into use. (For instructions
regarding preparation of packets of duplicate keys, refer paragraph 42 below).

(a) At centres where Bank of India has more than one Branch

(i) Instructions for the Main Branch

The duplicate keys should be lodged in safe custody with the local office of
the State Bank of India (or its associate) or of a nationalized bank whichever
is nearest to the Main Branch. If the local office of any other non-
nationalized bank happens to be nearest and the Main Branch finds it more
convenient to lodge the duplicate keys with such non-nationalized bank, the
Main Branch could do so after obtaining prior approval of the higher
Controlling Authority.

(ii) Instructions for Branches other than the Main Branch

The duplicate keys should ordinarily be lodged with the Main Branch of Bank of India at
the Centre. However, if the Main Branch is situated at a distance and if it is extremely
inconvenient to lodge the keys at the Main Branch, the duplicate keys may be lodged,
with the prior approval of the Controlling Authority, with any office of the State Bank of
India (or its associate) or of a nationalized bank. Controlling Authorities will grant such
permission sparingly, so as to restrict this facility to the minimum. Note: In the cases
covered under sub-paragraph (a) (i) and (ii) above, it is understood that the local office
of the other bank with which the duplicate keys are lodged affords the necessary facilities
563
for safe - keeping of the keys, such as fire proof safe, dual control over custody, etc.

(b) At rural and semi-urban/unbanked centres

(i) Branches of Bank of India situated at a rural/semi-urban Centre where a

bank other than the State Bank of India (or its associate) or a nationalized
bank is established may lodge their duplicate keys with such other bank
subject to sub-paragraph (a) (i) and to the 'Note' to subparagraphs (a) (i)
and (ii) above.
(ii) Branches of Bank of India situated at rural or semi-urban/unbanked
centres where there is no local office of the State Bank of India (or its
associate), a nationalized bank or a non-nationalized bank within a
convenient distance, should lodge their duplicate keys with an
established/approved Co-operative Bank or the local Sub-Treasury Office
or even the Post Office, after obtaining prior approval of the Controlling
Authority.
43.2 The purpose of lodging duplicate keys with another bank/institution is to ensure
not only safety of the keys but also to afford their easy access/availability if the originals
are lost or are not on hand. It is, therefore, necessary to select with care and caution
the depository for the duplicate keys (other than the State Bank of India/nationalized
bank), keeping our requirements in mind.

44. Preparation of Packets of Duplicate Keys

44.1 The duplicate keys should be kept in two separate cloth-lined, sealed packets, one
packet containing the duplicate cash safe keys and the other packet containing the
duplicate keys of the "other safes". Two lists of keys (with key numbers) should be
prepared (in duplicate) and should be signed:
(a) in the case of duplicate cash safe keys: by the Branch Manager and the
cashier
and

(b) in the case of duplicate keys of the other safes : by two officials, one of
whom should be the Branch Manager.

44.2 The original lists and relevant duplicate keys should be placed in the appropriate
packets which should be sealed by sealing wax with the Branch seal in the presence of
the persons who signed the list. The words "Cash Safe Keys" or "Other Keys", as
appropriate, should be written in bold handwriting on the relevant packets. The copies
of the lists of keys kept in the packets should be retained in a file in the custody of the
Manager. (At smaller Branches having a common safe for cash and securities, there is
no need to have two separate packets for duplicate keys of" cash safe" and "other safes"
- all the duplicates should be kept in one sealed packet).

564
44.3 The two sealed packets of duplicate keys should be lodged in the safe custody of
the nominated bank/Main Branch of Bank of India, as applicable, with the mode of
operation of safe custody account as under:

(a) deliverable on the joint signatures of two officials, one of whom should be
the Manager and the other to be the cashier only or in his absence the acting
cashier only (in case of sealed packets containing duplicate cash safe keys);

(b) Deliverable on the joint signatures of two officials; one of whom should be
the Manager (in case of sealed packet containing duplicate keys of other
safes).

44.4 The Main Branch of Bank of India, which receives the sealed packets containing
duplicate keys sent with a representative along with a letter of authority, should issue a
Safe Custody Receipt for the packets. An entry stating "two sealed packets said to
contain duplicate keys of "cash safe" and "other safes" of ................... Branch" should
be made in the Safe Custody Register of the Main Branch and the usual printed Safe
Custody Receipt signed by two authorized officers of the Main Branch should be issued.
No entries of the particulars of key numbers should be made in the Safe Custody Register
of the Branch lodging the duplicate keys.

44.5 Any change of the office of the Manager/Cashier/other official (who is the joint
signatory for the purpose of paragraph 65.2 (a) and (b) above should be promptly
advised to the nominated bank/Main Branch with which the duplicate keys are lodged.

44.6 The Safe Custody Receipt issued to the Branch must not be stored in the safes.
The intention of keeping the Safe Custody Receipt outside the safes is to ensure that in
the event of the keys of safes not being available, the Safe Custody Receipt of duplicate
keys (kept outside the safes) will be available to the Branch to collect the duplicate
keys.

44.7 Notings of the Safe Custody Receipt for duplicate keys lodged with another
Branch/Bank should be made in the Branch Documents Register at appropriate place.

565
 APPENDIX I

Specimen Ruling for Record of Cash Taken Out from the Till in the Morning
and
Returned in the Evening

Cash Initials Cash Initials Cash Initials of the

Date taken out of the lodged in of the Balance Manager/Deputy
Cashier Cashier Manager
Rs. Rs. Rs.

566
 APPENDIX II
(Paragraph 16.2)

Each banknote, which, on examination of various security features / parameters, is

determined as a counterfeit one, shall be branded with a stamp "COUNTERFEIT
BANKNOTE". For this purpose, a stamp with a uniform size of 5 cm x 5 cm with the
following inscription may be used.

COUNTERFEIT BANKNOTE IMPOUNDED

BANK:

BRANCH / CURRENCY CHEST

SIGNATURE
DATE
 APPENDIX III
(Paragraph 16.568)

Format – Acknowledgement Receipt to be issued to the tenderer of

Counterfeit Notes

Name of the Bank

Address:

Serial Number of the Receipt:

Date:

The note (s) described below received from..................................(Name

and Address of the tenderer) is/are counterfeit and has/have therefore been
impounded and stamped accordingly:

Serial number of the note Denominatio Parameters on

deemed as counterfeit n which the note is
deemed as
counterfeit

Total number of Counterfeit Notes:

(Signature of the Tenderer) (Signature of the

counter staff)

(Official Seal)

568
 APPENDIX IV
(Paragraph 16.569)

Date:

Consolidated Monthly Reporting for the month of

1. Name of the Bank / District:

2. Name and Address of the Nodal Officer:

3. Detail of Counterfeit Notes:

Date of Name of the Details of Denomination/ Security Unique Reference
Detection Branch/ Tenderer Pieces / feature number (URN)
Currency serial numbers breached generated by the
Chest NCRB Portal

4. The Counterfeit Notes are enclosed.

5. Kindly acknowledge receipt.

(Authorised signatory)
(Official Seal)
Encl:

569
 APPENDIX V
(Paragraph 16.4)
Date:

Name of the Bank:

District:
Name and Address of the Nodal Bank Officer:
Ref. No. .............

The Sr. Inspector of Police

__________ Police Station,

Dear Sir,

Detection of Counterfeit Note/s – Request for investigation

We enclose the following Counterfeit Notes detected in our office on ________ . The
details of the Counterfeit Notes are furnished below.

2. As the printing and/or circulation of forged Indian Currency Notes is an offence under
Sections 489A to 489E of the Indian Penal Code, we request you to lodge FIR and conduct
the necessary investigation. In case it is decided to file criminal proceedings in the court of
law, you may first arrange to send the notes to any of the Note Printing Presses, Forensic
Science Laboratories etc. in terms of the provisions of Section 292(1) and 292(3) of the Code
of Criminal Procedure for examination. The expert opinion furnished may be produced in the
court as evidence under Section 292 of the Criminal Procedure Code. The forged notes may
please be returned to us after the completion of the investigation and/or proceedings in the
court of law along with the detailed report of the investigation / decision of the court.

Denominatio Serial Notional Details of Name & Bank’s Unique

/n No. of number of Value tenderer address of Entry No. Reference
pieces Counterfeit the branch Number
Note /currency (URN)
chest generated
where in the
detection NCRB
took place Portal

3. The Counterfeit Notes are enclosed.

4. Please acknowledge receipt.

Yours faithfully,

Authorised Signatory
Official Seal
Encl:

570
 APPENDIX VI
paragraph 13.6)

PROPOSED DESIGN OF CASH VAN

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4

571
 Appendix VII
Paragraph 17.4 (b)

Reserve Bank of India (Note Refund) Rules, 2009 [As amended by Reserve Bank of India (Note
Refund) Amendment Rules, 2018]

Parts Contents
Part I Introduction
Part II RBI (Note Refund) Rules, 2009
Part III Memorandum of Procedure
Part IV Annex – I
Part V Annex- II (Security Features)

Part I

Introduction

The Reserve Bank has been extending facilities to the public for exchanging cut and
mutilated notes at all its Issue Offices and bank branches. In order to make the Note
Refund Rules easy to understand and to apply, these have been comprehensively revised
and simplified. It has also been decided that any officer of the branch can adjudicate
mutilated notes presented thereat. It is hoped that simplification and liberalisation of the
Rules would help both, the prescribed officers as well as the tenderers of mutilated notes
to easily comprehend the revised Rules and enable the former to apply the Note Refund
Rules without leaving any scope for subjectivity.

The facility for exchange of soiled, mutilated and imperfect notes is to be provided by
all banks at all their branches. This is a duty that the banking system as a whole owes
to the public. It needs no emphasis that the object of simplification of RBI Note Refund
Rules and its extension is to help members of the public to exchange the cut/mutilated
notes in their possession without difficulty. The bank branches should play an active role
and ensure that the facility is operated for the benefit of the members of public at large
and is not pre-empted by a group of persons.

This booklet contains Rules and Procedures to be followed under the Scheme. The
procedure required to be followed by the branches for acceptance, adjudication, and
maintenance of records of mutilated notes is also laid down in this booklet. All further
instructions to be issued on the subject will be with reference to this booklet and
branches of the banks shall update the booklet by making necessary amendments to it.
If any clarification is needed on the scheme, a reference should be made either to the
Issue Department of the Reserve Bank of India at its offices or the Chief General
Manager – In - Charge, Reserve Bank of India, Central Office, Department of Currency
Management, Mumbai – 400 001.

572
 Part II
Reserve Bank of India (Note Refund) Rules 2009

A. Provisions in the Reserve Bank of India Act, 1934:

Section 28: Notwithstanding anything contained in any enactment or rule of law to the
contrary, no person shall of right be entitled to recover from the Central Government or
the Bank, the value of any lost, stolen, mutilated or imperfect currency note, provided
that the Bank may, with the previous sanction of the Central Government, prescribe the
circumstances in and the conditions and limitations subject to which the value of such
currency notes or bank notes may be refunded as of grace and the rules made under
this proviso shall be laid on the table of Parliament.

Section 58(1): The Central Board may, with the previous sanction of the Central
Government, by notification in the Official Gazette, make regulations consistent with this
Act to provide for all matters for which provision is necessary or convenient for the
purpose of giving effect to the provisions of this Act.

Section 58 (2): In particular and without prejudice to the generality of the foregoing
provisions, such regulations may provide for all or any of the following matters, viz.-

( a )
( b )
(c)

(q) the circumstances in which, and the conditions and limitations subject to which the
value of any lost, stolen, mutilated or imperfect currency note of the Government of
India or bank note may be refunded.

B. Note Refund Rules

In exercise of the powers conferred by the proviso to section 28, read with clause (q) of
the sub-section (1) and (2) of section 58, of the Reserve Bank of India Act, 1934 (2 of
1934) and in supersession of the Reserve Bank of India (Notes Refund) Rules, 1975,
except as respect things done or omitted to be done before such supersession, the
Central Board with the previous sanction of the Central Government, hereby makes the
following rules for specifying the circumstances in, and the conditions and limitations
subject to which, the value of lost, stolen, mutilated or imperfect note may be refunded
as a matter of grace, namely:-.

1. Short title, application and commencement:-

(1) These rules may be called the Reserve Bank of India (Note Refund) Rules, 2009.

(2) They shall apply to a note, which is a legal tender on the date of its presentation
before the Bank.

573
(3) They shall come into force on the date of their publication in the Official Gazette.

2. Definitions:-

In these rules, unless the context otherwise requires:-

(a) “Act” means the Reserve Bank of India Act, 1934 (2 of 1934);

(b) “Bank” means the Reserve Bank of India constituted by section 2 of the Act;

(c) “Bank note” means any note issued by the Bank, but does not include a Government
note other than one rupee note, which has been deemed to be bank note as per the
Notification no. G.S.R 426, dated the 28th March, 1980 issued by the Government of
India, Ministry of Finance, Department of Economic Affairs;

(d) “essential features” means the features, including security features, which are
necessary for the identification of a note, namely-,

i. the name of the issuing authority in Hindi and/or English, that is; Bank or
Government of India, as the case may be;
ii. the guarantee clause in Hindi and/or in English;
iii. the promise clause in Hindi and/or in English;
iv. the signature in Hindi and/or in English;
v. the Ashoka Pillar emblem or Mahatma Gandhi portrait, as the case may be; and
vi. the water-mark of the Ashoka Pillar emblem or Mahatma Gandhi portrait, as
the case may be.

Explanation: For the purposes of this clause,

(A) the security features of a note, for deciding the genuineness or otherwise, include,

i. paper quality;
ii. size and shape of numbers;
iii. security Thread;
iv. intaglio printing;
v. latent Image in vertical band;
vi. electrotype watermark (in watermark window);
vii. micro lettering;
viii. fluorescence (number panels and central band);
ix. optically Variable Ink;
x. see-through Register, and
xi. any other security feature that may be introduced by the Bank.

(B) the essential features of a note have been enumerated with a view to help the
prescribed officer to establish the genuineness or otherwise of a mutilated note;

(e) “Government note” means any note issued by the Central Government or supplied
by the Central Government to the Bank and issued by the Bank, provided the liability

574
for the payment of the value in respect of such note has devolved on and been taken
over by the Bank;

(f) “imperfect note” means any note, which is wholly or partially, obliterated, shrunk,
washed, altered or indecipherable but does not include a mutilated note;

(g) “mutilated note” means a note of which a portion is missing or which is composed
of more than two pieces;

(h) “mismatched note” means a mutilated note which has been formed by joining a
half note of any one note to a half note of another note:

Explanation: For the removal of doubts, it is hereby declared that a mismatched note
can be identified on the basis of number, signature etc. and /or after examining other
security features;

(i) “note” means a Bank note or a Government note;

(j) “Prescribed Officer” means any officer of the Issue Department of the Bank or any
officer of an agent of the Bank/ designated by the Bank by arrangement through
agreement in this behalf as authorised to receive mutilated notes for adjudication under
these rules;

(k) “soiled note” means a note which, has become dirty due to usage and also includes
a two piece note pasted together wherein both the pieces presented belong to the same
note, and form the entire note.

Words and expression used herein not defined but defined in the Act have the same
meaning as assigned to them in the Act.

3. Decision on Adjudication of mutilated note- If any dispute arises in relation to

adjudication of mutilated note the same shall be referred to the Bank for its decision
and its decision shall be binding on the claimant, his nominees and legal heirs or
representatives as the case may be.

4. Presentation and disposal of claim- A claim in respect of any note may be

presented before the Prescribed Officer for adjudication and payment of value under
these rules.

5. Right to call for information or to hold enquiries-The prescribed officer may,

if it is considered necessary so to do, call for any information or hold any inquiry relating
to any claim presented before him under these rules, and where the genuineness of the
note is doubtful, he shall send such doubtful note for expert opinion to the General
Manager, Currency Note Press, Nashik Road or to any other authority as designated
under any law in force for this purpose.

575
6. General provisions in relation to all claims-

(1) No claim in respect of a note, which is alleged to have been stolen, lost or wholly
destroyed, shall be entertained.

(2) If the Prescribed Officer is satisfied that a mutilated note presented before him is
one which appears to have been cancelled at any office of the Bank or the claim is one
which appears to have already been paid under these rules, he may, after making
enquiries under rule 5 above reject the claim on such note.

3) A claim in respect of a note, which, -

i. cannot be identified with certainty as a genuine note for which the Bank is
liable under the Act;
ii. has been made imperfect or mutilated, thereby causing the note to appear
to be of a higher denomination, or has been deliberately cut, torn, defaced,
altered or dealt with in any other manner, not necessarily by the claimants,
enabling the use of the same for making of a false claim under these rules or
otherwise to defraud the Bank or the public,
iii. carries any extrinsic words or visible representations intended to convey or
capable of conveying any message of a political or religious character or
furthering the interest of any person or entity;
iv. has been imported into India by the claimant from any place outside India in
contravention of the provision of any law;
v. any information called for by the Prescribed Officer or the Bank, as the case
may be, is not furnished by a claimant within a period of three months from
the date of receipt of the notice or letter asking for the information, or
vi. in the opinion of the Prescribed Officer, a deliberate fraudulent intention
appears in respect of such a claim shall be rejected and shall not be eligible
for consideration under any other Law for the time being in force.

7. Imperfect note - The value of an imperfect note may be paid for full value/half
value as specified in the tables given in rule 8, if-

a. the matter, which is printed on the note has not become totally illegible , and
b. the Prescribed Officer is satisfied, having regard to the printed matter which
is legible on the note, that it is a genuine note.

8. Mutilated notes-

(1) The adjudication of claims in respect of notes of less than fifty rupees denomination
shall be made in the following manner, namely,

(i) if the area of the single largest undivided piece of the note presented is more than
50 percent of the area of the respective denomination, rounded off to the next complete
square centimetre, full value on mutilated notes of the above denominations shall be
payable;

576
(ii) If the area of the largest undivided piece of the note presented is less than or equal
to 50 percent of the area of the note, the claim shall be rejected.

Explanation: For the purposes of this sub-rule, it is hereby clarified that the value of a
mutilated note of less than rupees fifty denomination may be refunded in full if the
undivided area of the single largest piece of the note is as specified in column (5) of the
Table 1 below:

TABLE 1
Minimum area
(in cm2)
Lengt Width Area (in required for
Denomination
h (cm) cm2)
payment of
(cm)
full
(1) (2) (3) (4) value*
(5)
1 9.7 6.3 61.11 31
2 10.7 6.3 67.41 34
5 11.7 6.3 73.71 37
10 13.7 6.3 86.31 44
10 (New MG
Series) 12.3 6.3 77.49 39
20 14.7 6.3 92.61 47
20 (New MG
12.9 6.3 81.27 41
Series)
*Indicated as the next complete higher square centimetre after
half of the area of the notes in a particular denomination.

(2) The payment of claim in respect of note of rupees fifty and above denominations
shall be made in the following manner, namely-,

(i) Full value of the mutilated notes of the above denominations shall be payable if the
area of the single largest undivided piece of the note presented is more than 80 percent
of the area of the respective denomination rounded off to the next complete square
centimeter;

(ii) if the undivided area of the single largest undivided piece of the note presented is
equal to or more than 40 percent and less than or equal to 80 percent of the area of
the respective denomination rounded off to the next complete square centimeter, half
the value of the note is payable.

(iii) If the area of the single largest undivided piece of the note is less than 40 percent,
no value shall be payable, and the claim shall be rejected.

577
iv) if the claim of mutilated notes of rupees fifty and above denominations consist of a
note composed of two pieces of the same note and the two pieces, individually have an
area equal to or more than 40 percent of the total area of the note in that denomination,
then the claim may be refunded for full value of the note.

Explanation: For the purposes of this sub-rule, it is hereby clarified that the value of a
mutilated note of equal to or more than rupees fifty denomination may be refunded in
full or half, as the case may be, if the minimum undivided area of the single largest piece
of the note is as specified in column (5) or (6) of the Table 2 below:

TABLE 2
Minimum
area (in
Minimum area (in
cm2)
Lengt Width Area (in required cm2) required for
Denomination
h (cm) cm2) payment of half
for
(cm) payment of value**
full value@
(1) (2) (3) (4) (5) (6)
50 14.7 7.3 107.31 86 43
50 (New MG
13.5 6.6 89.10 72 36
Series)
100 15.7 7.3 114.61 92 46
100 (New MG
14.2 6.6 93.72 75 38
Series)
200 14.6 6.6 96.36 78 39
500 15.0 6.6 99.00 80 40
2000 16.6 6.6 109.56 88 44
@ Rounded off to the next complete higher square centimetre of 80% of the area
of the notes in a particular denomination.
** Rounded off to the next complete higher square centimetre of 40% of the area
of the notes in a particular denomination.

9. Payment of claim in respect of mismatched note- The payment of claim in

respect of a mismatched note may be dealt with as follows, namely-,

a. in case of notes upto rupees twenty denomination notes, the area of the larger
of the two pieces presented may be measured and adjudicated as per the
provisions of sub-rule (1) of Rule 8, ignoring the smaller half.
b. if none of the two pieces presented meets the minimum area stipulated as per
the provisions of clause (i) of sub-rule 1 of rule 8 above, the claim shall be
rejected.
c. in case of rupees fifty and above denominations, the two pieces may be
treated as two separate claims and dealt with accordingly.

578
10. Claimants to be bound by rules-

(1) Any payment which is provided under these rules shall be made only as matter of
grace and the Bank may, as it deems fit, from time to time issue such supplementary
or detailed instructions for carrying out the provisions of these rules, for the guidance
of the Prescribed Officer.

(2) Any person who makes any claim on account of an imperfect note or mutilated note
shall be deemed to have made the said claim under the proviso to section 28 of the Act
and subject to the provisions of these rules, which shall be deemed to be binding on all
claimants and their heirs or assigns.

11. Retention and destruction of note- Notwithstanding the denomination of a note

or the decision of the Prescribed Officer on the claim, a note presented before the
Prescribed Officer for the purpose of making a claim shall be retained and destroyed or
otherwise disposed of by the Bank in the following manner, namely-,

a. in the case of a note in respect of which full payment is made, at any time
after the payment; and
b. in the case of a note in respect of which no payment is made, or on which
half value payment has been made, on the expiry of a period of three months
from the date of the decision rejecting the claim or to pay half-value, as the
case may be, unless within this period, an order from a competent Court is
submitted to any office of the Bank or branch of the designated bank
restraining the Bank from destroying or otherwise disposing of the said note.

12. Payment to Legal heirs or nominees-

(1) If a claimant who has submitted a claim under these rules, is dead, his legal
representatives shall be eligible to receive the payment due to the claimant subject to
the determination of the claim by the Prescribed Officer.

(2) The legal representatives shall be entitled to receive the payment due to the
claimant, if any, upon furnishing to the Prescribed Officer an indemnity bond executed
by the legal representative in favour of the branch or office of the Bank or any other
institution or entity as designated by the Bank for this purpose;

Provided payment upto an amount of rupees five hundred may be made to the legal
heir of the claimant on a declaration for this purpose.

(3) In case of mutilated note presented at the Bank through Triple Lock Receptacle
(TLR) cover, the tenderer shall indicate his name and address along with other details,
such as, bank account number, etc. as specified on the cover, and the individual
tenderers, may, at their option, in addition, also indicate on the cover, the name and
address of the nominee who may receive the amount that is determined to be due on
the claim without production of indemnity, subject to proper identification.

579
13. Printed Forms- Where any indemnity bond as referred to in rule 12 is to be
executed in favour of the Bank a printed copy of the bond shall be supplied free of cost
to the claimant or the person eligible to receive the payment under these rules.

14. Stamp Duty- The value of the stamp duty on the indemnity bond shall be paid by
the person executing the bond.

15. Procedure when payee is untraced-

(1) In case of the note having been adjudicated at the office of the Bank, the value or
part of the value of a note is payable to the claimant and if such claimant, is not found
or is dead, his legal representatives or the nominee specified by him cannot be found or
fails within a period of three months from the date of communication to him the decision
to take steps to receive payment, the amount payable shall be paid to the Banking
Department of the Bank.

(2) In case of the mutilated note having been adjudicated at the branch of designated
bank or other entities, such payment may be credited with the Issue Office of the Bank
after a period of three months from the date of communication to the tenderer of the
decision to take steps to receive the exchange value.

Part III

Memorandum of Procedure for receipt, adjudication, payment and disposal of

/ mutilated notes at designated bank branches

1. Branches where facilities are available:

For the benefit and convenience of the public, Reserve Bank of India has authorized all
the branches of the banks to accept, exchange and pay the admissible exchange value
of mutilated notes in accordance with the Reserve Bank of India (Note Refund) Rules,
2009 or reject such mutilated notes as are not payable under these Rules.

2. Which notes shall be accepted:

The branches shall accept notes in the denomination of Rs. 1, 2, 5, 10, 20, 50, 100, 200,
500,, 2000 (and such other denominations of notes that may be issued in future) for
exchange under the Rules.

Further, such notes which have turned extremely brittle or are badly burnt, charred,
inseparably stuck together and therefore cannot withstand further handling or which
may lose their original identity with the passage of time shall not be accepted by the
branches for exchange. The holder/s of such notes may be advised to tender them to
the In- charge, Issue Department of the Reserve Bank of India under whose jurisdiction
the currency chest falls where such notes will be examined under Special Procedure.

580
3. From whom notes shall be accepted

The branches shall freely accept the notes from any one who wishes to get his/her
mutilated notes exchanged from the branch. For serving a larger section of the public
the branch may, if necessary impose a reasonable restriction on the number of the notes
to be tendered at a time by an individual tenderer. Large quantity of notes may be
accepted from the Government Departments and banks by mutual arrangements. The
branches shall take steps to see that the exchange facilities are not cornered by private
money changers or professional dealers of defective notes.

4. How the notes should be accepted

The notes may be accepted over the counter. On receipt of the notes, a paper token in
form DN-1 in duplicate indicating the number of pieces of notes and their value in each
denomination may be prepared. The receiving staff /official should also authenticate the
total pieces and value on both copies of the token by subscribing his initials. The original
should be handed over to the tenderer. The duplicate should be attached to the notes
and the token together with the notes should be passed on to the prescribed officer for
adjudication. The notes should be securely fastened to the relative tokens to avoid mix-
up of tenders covered by different tokens. It should further be ensured that the notes
do not get damaged during receipt and transmission to the prescribed officer. The paper
tokens should be serially numbered. To avoid disputes that may be raised by the
tenderers in respect of rejected notes, it is advisable to write the token number on all
the notes tendered. The details of each tender should be recorded in the register in form
DN-2.

5. Prescribed Officer - Adjudication and payment:

Prescribed officer is the officer who has been authorized to adjudicate the mutilated
notes by the branch as defined in Section 2(j) of the RBI (Note Refund) Rules 2009 for
the purpose of adjudication of the mutilated notes under the Rules. He shall examine
each and every mutilated note on its merit and decide its payablity strictly according to
the Rules. He shall record his 'Pay' order by subscribing his initial to a pay stamp, to be
affixed on the notes, which are found payable by him under the Rules. Similarly, he shall,
by subscribing his initials to dated 'Reject' stamp affixed on the note, record his rejection
order indicating rules 6(3),8(1)(ii) ,8(2)(iii) and Explanation (d) under which the claim is
rejected. The pay or rejection order should be put on front side of the note and not on
any paper used for pasting the notes etc. or on the reverse side of the note. The
prescribed officer shall also record his orders on the duplicate paper token attached etc.
the notes and get the rejection advice in form DN-3 prepared. The notes with the
covering token should then be sent back to the counter for making payment to the
tenderer.

The Prescribed Officer may if necessary, get the badly pasted notes, re-pasted before
their adjudication. He shall act with due diligence while exercising the powers under
these Rules in order to ensure that no notes payable under them are rejected and no
notes not payable are paid. If any paid notes are later on found by Reserve Bank of
India not to be payable under the above Rules, the Bank may recover the value of loss from
such of the authorized bank. The bank branch shall abide by the decisions of the Reserve
581
Bank of India, in this regard, who in pursuance of the above Rules is the ultimate
authority in whom the powers to make, issue, amend, interpret and enforce the Rules
are vested.

6. Payment

After receipt of the notes with the covering paper token from the prescribed officer, the
counter staff shall check that the PAY and REJECT orders have been properly recorded
on all the notes and the paper token. He shall then pay to the tenderer the exchange
value of the notes ordered to be paid and also issue him rejection advice in form DN-3 in
respect of rejected notes, if any, on his surrendering the original token issued to him with
his name and address duly written on the reverse of it. He shall then affix the dated
'PAID' stamp on the notes (on the obverse side) on which the exchange value is paid. In
no case the rejected notes shall be given back to the tenderer. After completion of
payment, the paid and the rejected notes should be segregated. The original token
surrendered by the tenderer should be attached to the rejected notes. It should be
carefully noted that notes on which half value has been paid should be kept with the
rejected notes for easy retrieval, should the tenderer choose subsequently to question
the payment of half value instead of full value. In the branches which do not have a
currency chest of the Reserve Bank of India, the paid and rejected notes shall be held
separately along with branch cash balance. The Branch Manager shall have, however,
overall responsibility for the proper and safe custody of the notes. It must be clearly
understood that both paid and rejected notes are to be retained by the bank on behalf
of the Reserve Bank of India and their disposal in any manner will be subject to such
directions that the Reserve Bank may give in this regard.

In the branches having currency chests, the 'paid' notes only shall be deposited in the
currency chest in multiples of Rs.500/- with a minimum of Rs.1000/-. The half value paid
notes and rejected notes shall, however, be held separately along with the cash balance
of the branch.

7. Accounting for notes adjudicated

The full value paid notes may be treated on par with non-issuable notes and shall be
kept as part of the currency chest balances following the procedure prescribed for
depositing non-issuable notes. These notes should be shown in the currency chest slip
as non-issuable notes. The paid notes shall be held distinct by segregating them from
soiled notes to be sent to the Reserve Bank of India and storing them in separate
receptacle. These notes may be packed separately and sent along with soiled notes at
the time of remitting soiled notes to the Issue Department of Reserve Bank of India. The
half value notes and the rejected notes shall be kept separately along with the cash
balance of the branch and in no case they shall be kept deposited with the full value
paid notes in the chest.

The non-chest branches shall send notes adjudicated by them for deposit to the linked
currency chest who in turn will remit to the Reserve Bank of India alongwith soiled note
remittance.

582
Verification and transfer of adjudicated notes:

Notes adjudicated for full value may be sent along with the soiled note remittance
separately. A qualitative and quantitative verification of such notes would be undertaken
in Reserve Bank of India. Such notes would be treated as a chest remittance and
accounted for accordingly.

Half Value paid notes and Rejected notes may be sent separately to Claim Section,
Issue Department of RBI. The prescribed officer should ensure that the preservation
period of three months as laid down in para 11(b) of the Rules note is over, before
sending them to RBI. However the details of the tenderer in DN-2 has to be preserved
for payment to him. These notes would be accounted as a receipt from that currency
chest-holding branch. These notes would be subject to audit at the Reserve Bank of
India to ensure that none of the rejected notes are payable for any value and none of
the half value paid notes payable for full value. As the half value paid and rejected
notes would have already completed the required period of preservation, they would
be destroyed by the Issue Department of Reserve Bank of India as deemed
appropriate.

8. Forged Notes

If during the course of adjudication of mutilated notes, any note is suspected to be

forged or is found to be forged, it should be impounded by the Prescribed Officer by
affixing 'COUNTERFEIT NOTE IMPOUNDED' stamps with his initial therein. The
procedure laid down in regard to handling of forged notes may be followed. For ready
reference on detection of forged note, the Salient features of genuine notes are given
in Annexure.

9. Miscellaneous

i) Only those notes which are mutilated should be examined and adjudicated by the
Prescribed Officer. Soiled notes (which include two piece notes having middle or near
middle cut either horizontally or vertically) should be freely accepted and exchanged at
all branches.

ii) Every effort should be made to pay the exchange value in minimum possible time,
but in any case it should be on the same day. To facilitate banking habits, exchange
value should be credited to the account through ECS or paid by way of Banker Cheque
or Demand Drafts.
iv) The Prescribed Officer should examine the tendered notes with due care. Notes
appear to be doubtful or built-up should be examined against a table-lamp to establish
the size of the largest undivided piece of the note which is the basic criteria of exchange
of notes.
v) The Prescribed Officer should record his pay order in red ink and arrange to have
the 'PAY' stamp affixed on it immediately. The 'PAY’ stamp should be held in his custody
to avoid misuse.
583
vi) Requests for expression of opinion on defective notes regarding their payability or
otherwise should not be entertained.

vii) No requests for inspection of or return of the notes tendered for exchange or for
any information relating to them should be entertained.

11. Accessories for Prescribed Officers:

The Prescribed Officers should be equipped with the following accessories to enable
them to exercise better judgement while handling defective notes: -

i. Table lamp of medium intensity.

ii. Magnifying glass.
iii. Measuring centimeter plate (in plastic).
iv. A set of genuine notes in all denominations of different patterns (for the
purpose of comparison in case of doubt).

12. Display over Notice Board:

The Branch Manager shall arrange to display outside the branch premises the following
board for information of the public in Hindi, English and local language:
'Mutilated notes are accepted and exchanged here'
Inside the banking hall and above the counter where mutilated notes will be accepted,
the following board will be displayed:

i. Mutilated notes are accepted here for exchange under Reserve Bank of India
(Note Refund) Rules.
ii. Exchange value, if any, must be collected on the same day.
iii. Notes on which exchange value is not payable will be retained by us.
iv. In case of difficulty, please see Branch Manager.

584
 31ा ग – IV / Part – IV
अनबाtr - I / ANNEXURE – I

फॉर्म डीएन – 1 (कटे – फटे नोटो के लिए टोकन)

Form DN-1 (Token for mutilated notes)

र्ुि प्रलि (प्रस्तुिककि म के लिए )

Original (For the tenderer)

(बैंक क न र् ) : क्रर् स. :
(Name of the Bank) : Sr. No. :

(श ख क न र् ) : ि रीख :

(Name of Branch) : Date :

नोट सख्यि र् ाल्य

(NOTE) (PIECES) (VALUE)
रु. Rs.
1/-

2/-

5/-

10/-

20/-

50/-

100/-

200/-

500/-

2000/-

जोड़:
TOTAL

585
प्र प्त क र् ा ा के आ द्य ि क्ष र
Receiver's Initials

(i) य ह टो क न भु ग र् ा न के लि ए उ सी लि न प्र स्र् ाु र्

ि क य ज वे । T h i s t o k e n s h o u l d b e
produced for payment on the same day.

( i i ) प्र स्र् ाु कम र् ा ा टो क न के पी छे अपन न र् ए व प र् ा

लि खें |
Tenderer should write his name and address on the reverse of the
token.

(iii) अस्वीकृ ला नोट प्रस् लााु लालकिर् को लााोटिये नही जिएगे |

Notes rejected shall not be returned to the tenderer

586
फॉर्म डीएन – 1 (कटे – फटे नोटो के लिए टोकन)
Form DN-1 (Token for mutilated notes)

िसरी प्रलि ( बैंक के लिए, नोटो के सिथ रिखी जिनी ाह )

Duplicate (For the bank to be kept with the notes)

( बैं क कि न र् ) क्रर् . स
(Name of the Bank) Sr. No.

(श ख क न र्) लािरीख:
(Name of Branch) Date

नोट सख्य र्ल्य

(NOTE) (PIECES) (VALUE)
रु. Rs.

1/-

2/-

5/-

10/-

20/-

50/-

100/-

200/-

500/-

2000/-

जोड़ :
TOTAL

यित र्ूल्ि
अदत करे अदत करे
PAY
PAY HALF VALUE

तनयि
( i ) अयिकतरी
तनयि य ह टो क न भु ग र् ा न के लि ए उ सी लि न प्र स्र् ाु र्
अयिकतरी
Prescribed Officer
ि क य ज वे । T h i s t o k e n s h o u l d b e
produced for payment on the same day.

प्रतप् प्र स्र् ाुके कम र् ा ा

( i i )यूककतम टो क नअस्वीकृ
के पीयूछेकरे अ प न न र् ए व प र् ा
लि खें |
िद्यतक्षर Reject
Tenderer should write his name and address on the reverse of the
token.
Receiver’s Initials तनयि अयिकतरी
Prescribed Officer
587
(iii) अस्वीकृ ला नोट प्रस् लााु लालकिर् को लााोटिये नही जिएगे |
Notes rejected shall not be returned to the tenderer

588
फॉर्म डीएन – 2 (रििश रुपये र् ाे ा)
FORM DN.2 (Amount in Rupees)

प्रिप्ला, अिि ककये गये और अस्वीकृ ला कटे – फटे नोटो कि रजजस्टर

Register of mutilated notes received, paid and rejected

नोट जजसकि परि र् ाल्य अिि ककयि गयि (नोटो नोट जजसकिलआि परि र् ाल्य अिि अस्वी
लािरी टोकन प्रिप्ला लक
नोट
ख स. Receipt की सख्यि ) NOTES PAID FOR FULL VALUE (Number of ककयि गयि (नोटो की सख्यि ) NOTES Notes
Date pieces) HALFFORVALUE (Number of Pieces)
PAID
Rejected
Token कु ला र् ाल्य
1 2 5 10 20 50 100 200 500 2000 T.Ps Value 50 100 200 500 2000 T.Ps Value T.Ps
No. नोट Value

परि र् अस्वीलक
ाृ
अद्यिक्षर लााे खि टटप्पणी
ा ाल्य नोट /
अििलकि अिि ककए र् ल्य अ ि ि अ द्य ि क्ष र Remarks
किर अद्यिक्षर Initials of लआि ा Initials of
र् गये नोटो
लिपपक को नष्ट ककए गये
Acctt.
Initials of करने की नोटो को
Paying लािरीख नष्ट करने
Clerk Date of की लािरीख
Destruction िनलय उप को. प्र. / Date of िनलय उप को. प्र. /
/ प्र. स.र् .प्र / प्र. स.र् .प्र
of full अलिकिरी Destruction अलिकिरी
value paid
Prescribed Dy. TR/ Mgr / of half value Dy. TR/ Mgr /
Officer paid/rejected Prescribed
notes Mgr. AGM Mgr. AGM
notes Officer

589
फॉ र् डी ए न - 3
Form DN-3
( बैं क / श ख क न ि र् )
(Bank / Branch Name)
के स स . डी . एन ---
Case No. DN of ---

लािरीख:Dated:

श्री / श्री र् ि र्
Shri / Smt. __________________

िप्रय र्होलाय / र्होलाय ,

Dear Sir / Madam

कटे -फटे नोटो पर ििवि

Claim on Mutilated notes

हर् यह सलिला कररे हैं क आपने र् ाल्य कक अिियगी के लिए, जो िनम्नलिखखख नोट प्रस्लााु ला ककए
थे उनकी अिियगी नही क जि सलकी, क्ोक भिररीय ररजवर् बैंक (नोट विपसी) िनयिमलवी के
क क
अलागलर् ऐसे िोषपणर् नोटो कि भुलगिन करने के लिए जो लशे अपेक्षलक्ष हैं वो परी नही होलााी ; िे खे
नीलााे कक िम सख्यि

We advise that the under mentioned notes tendered by you for payment of value cannot
be paid as the conditions under which payment can be made on such defective notes
under the Reserve Bank of India (Note Refund) Rules are not satisfied vide items (s)----
----------------below :

(नोट के ब्योरे औरर् ाल्यवगर् हििशये र् ाे ा टिये गये हैं )

(Details of pieces and denomination are shown in the margin

590
( अ +I ाीक - r4 के क रण )
(Reason for rejection)

( क ) यह / ये नोट , विस् लापवक नोट / नोटो के रूप र् ाे ा नही पलहिनि जलिि / पलहिने जलिे ,
जजसके /
जजनके भुलगिन के लिए बैंक जजम्र्ाेििर हैं – िनयर् 6(3)(i)

(A) Notes (s) cannot be identified as genuine note (s) on which the Bank is liable to pay

– Rule 6(3) (i).

(ख) नोट इस प्रक र व्यवह र र् ाे ा लाियि गयि ह / लािए गये हैं (जरूरी नही कक ििवे ििर द्विरि
व्यवहिर र् ाे ा लािए गये
हो ) कक िनयर् 6(3)(ii) के अलागलर् उसे / उन्हे अस्वीकृ ला करनि पड़ि ।

(B) Note (s) seem (s) to have been dealt with (not necessarily by claimant) in such

manner as to entail rejection under Rule 6(3) (ii).

(ग) नोट / नोटो पर अनिवश्यक शब्द लिखे गऐ हैं , जो कक रिजनलिक स्वरूप कि सिे श िे लााे ह यि

उनसे ऐसि अथर् िनकलिि जि सलकि ह –िनयर् 6(3) (iii)

(C) Notes carry/ carries extrinsic words of visible representations intended to convey or

capable of conveying message of political character – Rule 6(3) (iii).

( घ ) लागर् ा ह कक नोट ग र किन नी रूप से भिरर र् ाे ा लाियि गयि हैं / लािए गये हैं –
िनयर् 6(3) (iv)

(D) Note (s) appear (s) to have been illegally imported into India – Rule 6(3) (iv).

(ङ) िनटिर्ष्ट अलिकिरी / बैंक द्विरि िं गी गई जिनकिरी ििवे सर ने िलनिर्ररर अवलि र् ाे ा प्रस् लााु ला
नही कक – िनयर् 6(3)(v)
(E) Information called for by the prescribed Officer/ Bank not furnished by claimant

within stipulated period – Rule 6(3) (v).

591
( च)प्रस्र् ाुर् िकय गयि / ककए गये सरकिरी नोट िनयर् -2 र् ाे ा िी गई लशर् परी नही कररि /
करर् ाे ।

(F) Government Note (s) presented does/ do not satisfy the conditions stipulated

in Rule2.

(छ ) बी स रु प ए कम के र् ल्य व ग के प्र स्र् ाु र् ि क ए ग ये नो ट क स

ब से ब ड़ अ ि व भ ि ज र् क्षे त्र उ स
नो ट के क्षे त्र के 5 0 % के ब र ब र य उ स से क र् हैं - - ि न य र् 8 ( 1 )
(ii)

(G) The area of the largest undivided piece of the note presented is less than or

equal to 50% of the area of the note upto Rs. 20/- denomination – Rule 8(1) (ii).

(ज ) प च स रु प ए औ र उ स से अ लि क र् ल्य व ग के प्र स्र् ाु र् िकए

ग ए नो ट क स ब से ब ड़े अ ि व भ ि ज र् क्षे त्र
स ब ि लि र् र् ल्य व ग के नो ट के क्षे त्र के 4 0 % से क र् ह – ि न य र् 8 ( 2 ) ( i i i )

(J) The area of the single largest undivided piece of the note is less than 40% of

the area of the respective denomination for the note of Rupee Fifty and above –

Rule 8(2) (iii).

( झ ) प्र स्र् ाु र् ि क ए ग ये ला ाो नो टु क ड़ो र्ें से को ई भी टु क ड़ ि न य र्

8 ( 1 ) ( i ) के अ नु स र ि लन र र र् ि य न र्म क्षे त्र को प र न ही क र र् ा ह -
ि न य र् 9 ( ख )

(I) None of the two pieces presented meets the minimum area stipulated as per

the Rule 8(1)(i) – Rule 9 (b).

(ञ ) ि न य र् 8 ( 2 ) ( i i ) के अ नु स र नो ट के अ ि क र् र् ल्य क लआ र् ल्य
ही लअ ा ि क य ग य हैं ।

(J) Only half of the face value of the note(s) is paid in terms of Rule 8(2) (ii).

592
2 . अ स्वी कृ र् नो ट इ स क य ला य र्ें र ख लि य गय हैं / र ख लि ए ग ए
हैं और यथ स र् य न ष्ट क र लि य ज ए ग /
क र लि ए ज ए गे अ थ व भ र र् ाी य र र ज व बैं क ( नो ट व प सी )
ि न य र् लवी 2 0 0 9 के ि न य र् 1 1 के अ नु स र अ ि य प्र क र से
ि न प ट य ज ए ग / ि न प ट ए ज ए गे ।

2. The rejected note(s) has/ have been retained in this office and will in due

course be destroyed or otherwise disposed of in terms of Rule 11 of the Reserve

Bank of India (Note refund) Rules 2009.

भ लवी य
Yours Faithfully

श ख प्रबलिक के लिए
For Branch Manager

नो ट : ( i ) भ र र् ाी य र र ज व बैं क ( नो ट व प सी ) ि न य र् लवी , 2 0 0 9 क
ि न य र् 1 0 ( 2 ) के अ नु स र ि क सी
भी प्र क र के ला ा वे के स ब ला र्ें ि न र् ला ा ष्ट अ लि क री अ थ व
भ र र् ाी य र र ज व बैं क क ि न ण य अ ि र्म हो ग ।

Note: (i) In terms of Rule 10(2) of Reserve Bank of India (Note refund)

Rules, 2009 the decision of the Prescribed Officers or the Bank

in regard to any claim shall be final.

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( i i ) ि न य र् 1 1 ( ब ) र्ें लि ए ग ए उ प ब ला को छो ड़ क र अ ि य ि स्थ ि यों
र्ें , भ र र् ाी य र र ज व बैं क ( नो ट व प सी ) ि न य र् लवी , 2 0 0 9 के अ ग म र्
प्र स्र् ाु र् को ई भी ला ाो ष प ण नो ट बैं क अ प ने प स रख ला ाे ग और
भु ग र् ा न के प श्च र् ि क सी भी स र् य अथव ला ा व अ स्वी कृ र् क र ने
ि क र् ा र र ख से 3 र् ि ह ने ि क स र् प्ती के ब ला , ज स भी र् लर् हो ,
न ष्ट क र ला ाे ग य अ ि य प्र क र से ि न प ट न क रे ग ।

(ii) Save as provided in Rule 11(b), any defective note presented under Reserve Bank of India

(Note refund) Rules, 2009 shall be retained by the Bank and destroyed or otherwise disposed

of at any time after payment or on the expiry of period of 3 months from the date of rejection

of the claim as the case may be.

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 Part - V
Security features of Indian banknotes

Watermark

The Mahatma Gandhi Series and Mahatma Gandhi (New) series of banknotes introduced in 2016
contain the Mahatma Gandhi watermark and an electrotype mark showing the denominational
numeral in the watermark window.

Security Thread

The Mahatma Gandhi Series and Mahatma Gandhi (New) series of banknotes of denominations
of Rs.100 and above have Machine-readable windowed demetalised clear text magnetic security
thread. The colour of the thread changes from green to blue when viewed from different angles.
In case of Rs.100 denomination, the thread has a width of 2 mm while for higher denominations
it’s width is 3 mm.

Rs.2000 notes contain a windowed security thread alternately visible on the obverse with the
inscriptions ‘Bharat’ (in Hindi), ‘2000’ and ‘RBI’, but totally embedded on the reverse. The
Rs.500, 200 and 100 notes have a security thread with similar visible features and inscriptions
‘Bharat’ (in Hindi), and ‘RBI’. When held against the light, the security thread on these notes
can be seen as one continuous line. The Rs.10, 20 and 50 notes contain fully embedded
windowed security thread with the inscription ‘Bharat’ (in Hindi), and ‘RBI’. Notes issued prior
to the introduction of the Mahatma Gandhi Series have a plain, fully embedded security thread.

Micro Letter

This feature appears on the vertical band [In MG (New) Series] on left side and inside the
Mahatma Gandhi portrait. It contains the word ‘RBI’, ‘भिरर ', ‘INDIA' and the denomination. This feature
can be seen well under a magnifying glass.

Latent Image

On the obverse side of MG (New) Series banknotes of Rs.100 and above denomination, a
horizontal band on the bottom left side of the Mahatma Gandhi’s portrait contains a latent
image showing the respective denomination value in numeral. This feature is also present in
MG Series banknotes of Rs.100 and above (Rs.50 and 20 denomination issued till 2016 as well).
However the vertical band is located on the right side of the Mahatma Gandhi portrait. The
latent image is visible when the note is held horizontally at eye level at an angle of 45 degree.

Intaglio Printing

The portrait of Mahatma Gandhi, the Reserve Bank seal, guarantee and promise clause, Ashoka
Pillar Emblem, RBI Governor's signature are printed in intaglio i.e. in raised prints, which can be
felt by touch, in banknotes of Rs.100 and above.

595
Identification Mark

On all notes of Rs.100 and above of the MG (New) Series, a special feature in intaglio is present
on the right side (left side in case of previous MG Series) of the watermark window. This feature
is in different shapes for various denominations (Rs.100-Triangle, Rs.200-H, Rs.500-Circle, Rs.
2000-rectangle). Further, different numbers of angular bleed lines (Rs.100-four, Rs.200- four
with two circles in between the lines, Rs.500-five, Rs.2000-seven) on both right and left side of
the note helps the visually impaired to identify the denomination.

Fluorescence

Number panels and the vertical bands [in MG (New) Series] of the notes are printed in fluorescent
ink. The notes also have optical fibres spread out on the CWBN paper. These areas exhibit
fluorescence when held under UV light.

Colour Shift Ink

The numeral in banknotes of Rs.200 and above are printed in colour-shift ink. The colour of the
numeral appears green when the note is held flat but would change to blue when the note is
held at an angle.

See through Register

The denomination printed both on the front (hollow) and back (filled up) of the note on the left
side of the banknotes has an accurate back to back registration. The denomination will appear
as one when seen against the light.

For detailed information, the Annex (vii) of RBI’s Master Circular – Detection and Impounding of
Counterfeit Note may be referred.

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 APPENDIX VIII
(Paragraph 18.3)

Specimen Ruling for Pass Book for Record of Cash Received, Counted and Delivered
to the Cashier-in-Charge of the Till
Dated Bundles of Notes Initials of Initials of Initials of the
the receiving Recounting Cashier in Charge
Cashier Cashier of the Till

2000 500 200 100 50 20 10 5 2 1

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 APPENDIX IX
(Paragraph 18.1)
Sealing of Currency Notes - Procedure

1. PREPARATION OF PACKETS

(i) All cash received across the counter should be sorted, shroffed and precounted
into packets of 100 pieces by the cashiers. Each of these packets should be
wrapped by an appropriate note Denomination Slip (Cash -1166 printed on light
green paper for note packets of issuable notes and Cash - 1165 printed on pink
paper and yellow paper for non-issuable and mutilated / cut notes respectively).
Cut, defective, torn, mutilated notes should be deposited with the Currency Chest
Branches separately and not put in packets of non-issuable notes. The stocks of
printed labels should be handled carefully by the staff concerned so as to prevent
its misuse. The wrapping should be made around the left hand edge of the note
packet in such a way that the note denomination slip covers approximately two-
thirds to three-fourths of the length of the note bunch on the front side and about
half of the length of the back side.

(ii) In view of the considerable difficulties faced by the public in opening packets which
bear multiple stapling and the notes getting damaged by repeated multiple stapling
and consequently not being readily accepted in transactions, with the result that the
people are put to avoidable hardship.

(iii) Banks should do away with stapling of currency note packet and instead secure note
packets with paper bands/ polymer bands;

(iv) Banks should sort notes in re-issuable and non-issuable and issue only clean notes to
public. Soiled notes in unstapled condition may be tendered at RBI in inward
remittances through currency chests;

(v) Banks should forthwith stop writing of any kind on water mark window of currency
notes.

(vi) The protective seal should be colourless and transparent. An emblem of the Bank, i.e.
star and the legend "BANK OF INDIA" will be printed on the seal. Seals should be
affixed on both the sides (one on each side) of the note packet
(vii) The cashier preparing the packet should also ensure that the note slip is affixed
with stamps indicating the name of the Branch and the date of preparing the
packet.

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 (viii)After tying up these packets of currency notes into bundles of 10 packets, should
be entered in a pass-book. The pass-book and the counted packets of currency notes
should be handed over to second cashier for recounting of currency notes in packets.
The second cashier after recounting / checking the notes piece by piece in each
packet should sign in full on cash denomination slip against the words 'Checked by'
in the space provided for the purpose. Further, the name of the second cashier
recounting the currency notes should be either written in bold capitals or rubber
stamped below his signature.

(ix) When at a branch there is only one cashier, packets of notes should be recounted
by the same cashier who has prepared the packets and the note slips on such packets
should bear the second signature of the same cashier on the space provided.

2. RESPONSIBILITY:

(i) So long as the seals are intact and there is prima facie no evidence to suspect that a
packet has been tampered with the cashier preparing the packet and the cashier
recounting the packet are responsible for the quality, quantity and the value of the
contents in the packet jointly until disposed of in the course of business, regardless of
whether they are held in the same branch or any other branch.

(i) If, however, while turning out packets from the Till/Vault to paying cashier, the
paying cashier detects any discernible prima facie evidence of tampering on a
packet and if shortages are discovered in such a packet, the Cashier-in-Charge
or Cashier Officer will be held responsible for the shortages. The responsibility
for shortages in the packets exhibiting signs of their having been tampered
with which if not pointed out by the paying cashier at the time of their being
issued to him, will devolve on him and he will have to make good the loss.

3. REMITTANCE:

(i) While effecting remittance of sealed note packets from one Branch to another, the
Cashier-in Charge or Cash Officer of the remitting Branch will ensure that all the
packets making up the remittance are prima facie untampered and all other procedural
details pertaining to preparation of sealed note packets have been strictly adhered to
in respect of each and every packet making up the remittance.

(ii) Similarly, the Cashier-in-Charge or Cashier Officer at the receiving Branch should verify
that all the sealed packets making up the remittance are prima facie in order

599
 and they bear no evidence of having been tampered with. He should also verify that
the note packets bear the signatures of the Cashiers, preparing the packet and
recounting the same. He should then take them over without getting them recounted.
However, whenever the Cashier-in-Charge of the receiving Branch has any cause for
suspicion, he should get such packets recounted and in the event of any shortages
being detected, he should arrange to send back such packets to the remitting Branch
with the seals and note slips in the conditions they were found in. The note slips of
such packets should also be countersigned on the reverse by the remitting Branch
representative who accompanies the remittance, in token of the packet having been
found in a tampered condition by the receiving Branch. In case, in such a packet no
shortage is detected, the Cashier-in-charge or Cashier Officer at the receiving Branch
should arrange to have a fresh packet prepared and recounted as indicated above in
the procedure for preparation of packet.

4. GENERAL INSTRUCTIONS:

(i) In terms of the clean note policy of RBI announced in 2001, currency note should
neither be stitched nor stapled for making into a packet. The notes duly sorted into
issuable and non-issuable ones, should be made into packets of 100 pieces with a
polymer or paper band. Rubber bands should not be used for the purpose of holding
the currency notes in packets.

(ii) The paper / polymer bands/seals sufficient for a period of 3-4 months should be
indented at a time as the seals loose effectiveness if they are stored unused for a long
time, the shelf-life being less than a year.

(iv) the note packets should be made into bundles of 10 packets each. Thus each bundle
of notes will have 1000 pieces of currency notes.

(v) non-issuable note bundles should be sealed in a shrink wrapping machine, with the
paper seal of the branch duly filled in, kept inside the bundle, in a such a manner that
the details are visible without opening the bundle. Such bundles may be lodged with
RBI by the currency chest branches straight away. RBI since revised the procedure
and banks have been directed to remit the soiled currency in packets by shrink
wrapping 1000 pieces in a bundle replacing the existing procedure of packing of 10
packets of 100 pieces in a bundle. This measure has been taken to bring more
efficiency in note processing operations by RBI.

(vi) Whereas the responsibility of the employees who have prepared and recounted the
packet ceases as soon as the packet is broken by the paying Cashier, it may happen
that a defective note is detected with a defect which could not have been

600
 detected while the packet was intact (if this defect was on the left hand side of the
ring thread). In such an event, the paying cashier should immediately report the
matter to the Cashier-in-Charge or Cashier Officer, who should recover the amount
of the defective note from the Cashier who has prepared the packet. When the
packet pertains to remittance received from some other branch, the Cashier-in-
Charge or Cashier Officer should record this fact and report to the Branch Manager.
Then the defective note shall be returned to remitting branch along with the relevant
note slip, duly countersigned on the reverse by the cashier detecting the defective
note. The remitting branch shall be advised to recover the amount of the defective
note from the concerned cashier preparing the note packet and to remit the same
to the said branch. Such events should also be promptly reported to the controlling
authority.

(vii) A record should be kept at each Branch of such instances and Cashiers who
detected defective notes as well as shortages as also that of the cashiers who had
prepared and recounted the packets. In the event of frequent occurrences the name
of the Cashier should be probed into.

(viii) Every Cashier-in-Charge/Cashier Officer should also maintain for reference a

systematic record of the specimen signatures of all the members of the staff who are
working in the Cash Department. He should also ensure, while taking over newly
prepared packets, that the signatures appearing on the note slips conform to the
recorded specimen signature.

(ix) It should be noted very carefully that, so long as the seals are intact and there is no
prima facie evidence on the note packet of any tampering, the Cashier preparing the
packet and the Cashier recounting the packet, will be jointly responsible for the quality,
quantity and value of the note packet prepared/examined/recounted by them. If,
however, at a particular branch there are frequent detections of shortages in sealed
note packets bearing no apparent remarks of tampering and there are reasons to
suspect foul play, the matter should be brought to the notice of the controlling
authority.

(x) All the Branch Managers should ensure that the revised system and procedure for
sealing of note packets is implemented at their Branches irrespective of whether or
not they are required to send remittance(s) to other Branches.

601
 APPENDIX X
Paragraph 9.1
Procedure for Remitting / Lodging Cash

1. The Branch calling for cash should send an intimation in writing, signed by two officials of
the Branch (Cashier-in-charge and Joint Custodian of Cash from Accounts Department/
Manager/Chief Manager). Similarly, the Branch lodging cash should also give suitable
intimation to the receiving Branch. Branches should take precautions to maintain full
confidentiality of remittances from security point of view. However, in emergent
circumstances, telephonic requests may also be made, which should be confirmed in
writing immediately thereafter.

2. While lodging cash in branch account with RBI/SBI/other Banks, the remitting Branch
should debit initially G/L Suspense Account Cash Lodged with - (RBI/SBI/other Banks as
applicable) by using plain 'debit' voucher (CD53). The voucher should be signed jointly by
the cashier-in-charge of the branch and the Joint Custodian of Cash from Accounts
Department/Manager/Chief Manager as the case may be. The cashier carrying the
lodgement will have to sign on the reverse of the voucher in full for having received the
cash for the purpose of lodgement.

The debit in the G/L Suspense Account Cash Lodged with (RBI/SBI/other Banks as
applicable) should be wiped out on the same day after verification of the counterfoil of
paying-in-slip for cash lodged, duly receipted by RBI/SBI/other Banks as the case may be
by debiting G/L Account (RBI/SBI/other Banks as applicable) and crediting G/L Suspense
Account Cash Lodged with RBI/SBI/other Banks (as applicable).

iv) .. While lodgement / remittance of cash takes place between two branches not served
by
a Currency Chest, the Cash Remitting / Lodging Branch should debit the amou nt
initially to G/L Suspense Account Cash Lodged with / Remitted to ....................... branch
by using plain debit voucher (CD 53) giving full particulars of the branch to which the cash
is remitted/lodged, date and reference number of written / telephonic request from
the ............................. Receiving Branch (as applicable), denomination of cash etc. The
voucher should be signed jointly by the Cashier-in-charge of the Branch and the Joint
Custodian of Cash from Accounts Department / Manager / Chief Manager as the case may
be. The cashier who carries the lodgement or the cashier of the Receiving Branch if he
has been deputed to receive cash from the Remitting Branch will sign in full on the reverse
of the Suspense debit voucher for having received the cash for the purpose. The
transactions of cash remittance between branches or between branches and currency or
vice-versa should be routed through the CASHTR Menu and no credit or debit notes should
be drawn for the purpose.

602
(10) (A) Precautions to be taken at the Remitting Branch

(i) The Cash Remitting Branch should intimate in writing the Cash Receiving Branch about
the cash remittance. Branches should incorporate in the written communication to the
Cash Receiving Branch, the following particulars:

a. Date of cash remittance

b. Amount of cash remittance,
c. Denomination-wise break-up of cash remitted

Denomination No. Amount No. of No.of loose Total No. of

(Rs.) Of of(Rs.)pa Bundles packets of packets
Notes each 100 notes containing 100
containing each notes.
10 Packets

1.
2.
3.
4.
Total

The letter containing the above particulars should be sent in duplicate along with the cash
remittance to the Cash Receiving Branch with a request to return the duplicate with the written
confirmation of the Cash Receiving Branch for having received the cash remitted under the
signature of the Chief cashier.

The cash to be lodged should be neatly tied denomination-wise in bundles of ten packets each.
As far as possible, loose packets (i.e. Where the number of packets are less than ten and hence
cannot be made into a bundle of ten packets) should not be sent for lodgement. Exceptions
may be made by branches with small cash retention limits and in case of high denomination
notes as well as packets of soiled notes/non-issuable notes, etc.

(B)At the Receiving Branch:

(i) The cashier of Cash Remitting Branch, on reaching the Cash Receiving Branch,
should hand over the letter in duplicate advising the cash remittance, to the Chief
Cashier of the Cash Receiving Branch.

(ii) It is the primary responsibility of the cashier of the Cash Remitting Branch to
hand over the cash as per denominations indicated in the letter, to the Chief
Cashier of the Cash Receiving Branch. To ensure this, the Cashier of the Cash

603
 Remitting Branch should first hand over the loose packets of higher denominations,
if any, followed by the tied bundles to the Chief Cashier of the Cash Receiving
Branch.

(iii) The Chief Cashier of the Cash Receiving Branch should then acknowledge in writing
under his signature, receipt of the cash as per the denominations on the duplicate of
the letter received from the Cash Remitting Branch, in addition to handing over the
Credit Note for the cash lodged.

The procedure in para (10) is to be followed when the cashier of the Cash Remitting Branch
goes to the Cash Receiving Branch for lodging the cash. There may be occasions when the
cashier of the Cash Receiving Branch is required to go to the Cash Remitting Branch for taking
delivery of the Cash. A similar procedure to that enumerated above should be followed in such
cases also. Needless to add that in such cases the Cash Receiving Branch, on receipt of the
cash, on the same day should draw and send Credit Note for the amount of cash received to
the Cash Remitting Branch by the quickest possible means.

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 APPENDIX XI
(Paragraph 24.4 D)

CLEARING DIFFERENCE REGISTER

Date Details of Diff Amount Initial Adjusted on

(Cheque No., Date or ‘p’
amount, presenting Dr. Cr. Balance marked on
Bank-Branch) date

605
 CHAPTER 12: INOPERATIVE / DORMANT ACCOUNTS AND
UNCLAIMED DEPOSIT

Accepting of deposits from the public is an important function of the Bank. It is quite possible
that some of the accounts are not operated upon by the customers for quite a long period
under circumstantial compulsions and become oblivious of their deposits.

Accounts which are not operated for a continuous period of two years by the customers
are required to be classified as inoperative / dormant accounts as per the guidelines of
Reserve Bank of India. Such inoperative / dormant accounts attract inherent risk and also pose
difficulties to the Bank, Customers and / or to their legal heirs in tracing the account to make
it operative and /or for making payment to the customers / legal heirs.
In view of increasing volume of inoperative accounts in the banking sector & amount of
unclaimed deposit i.e. deposit accounts which are not operated since last 10 years and the
inherent risk associated with such deposits, RBI has directed banks to put in place a policy
and should play a more pro-active role in strengthening the regulatory frame work for
inoperative/dormant accounts i.e. accounts which are not operated for the last two years and
unclaimed deposits. Accordingly, this policy document on inoperative / dormant accounts has
formulated to outline the principles of various safeguards and obligations on the part of the
bank to fulfil its commitments towards the customers and recognizing the rights of the
customers.

2. Classification of Inoperative / Dormant Accounts:

2.1 Potential Dormant Accounts: Accounts in which there are no customer induced
operations (i.e. no credit or debit other than crediting of periodic interest or debiting of service
charges) for more than one year. Though such accounts are in active status, it is called
potentially dormant account. If such accounts are operated in time, it will not turn into dormant
accounts.

2.2 Inoperative / Dormant Accounts: A savings as well as current account shall be treated
as inoperative / dormant if there are no transactions in the account for over a period of two
years. In case of term deposits, the 2-year period shall be reckoned after the date of maturity.
For the purpose of classifying an account as "inoperative" both the type of transactions i.e. debit
as well as credit transactions induced at the instance of customers as well as third party will
be considered. However, the service charges levied by the bank or interest credited by the
bank will not be considered.
There may be instances where the customer has given a mandate for crediting the interest
on term deposit account and / or crediting dividend on shares to the savings bank account
and there are no other operations in the savings b ank account. Since the interest on term
deposit account and / or dividend on shares is credited to the savings bank accounts as per
606
the mandate of the customer, the same shall be treated as a customer induced transaction.
As such, the account should be treated as operative account as long as the interest on term
deposit account and /or dividend on shares is credited to the savings bank account. The
savings bank account can be treated as inoperative account only after two years from the
date of the last credit entry of the interest on term deposit account.

2.3 Unclaimed Deposits:

Current and Savings account where no customer induced transactions has taken place for last
10 years and Time Deposit or Other Credits which is not withdrawn in 10 years after its maturity
date are classified as unclaimed deposits.

3. Definition:
(a) Bank induced transaction- Transactions in the account initiated by the bank as per its
extant policy such as charges, fees, interest payments, penalties, taxes (an illustrative list is
given in Annex III).
(b) Customer induced transaction- The transactions in account which are in the nature of:
i) a financial transaction initiated by or done at the behest of the account holder by
the bank/ third party (an illustrative list is given in Annex III) or;
ii) a non-financial transaction, or;
iii) KYC updation done in face-to-face physical mode or through digital channels such
as internet banking or mobile banking application of the bank.
(c) Financial transaction- A monetary transaction in the savings/ current account of the
customer with the bank either by way of a credit or debit transaction.
(d) Inoperative Account- A savings/ current account shall be treated as inoperative, if there
are no ‘customer induced transactions’ in the account for a period of over two years.
(e) Non-financial transaction- An enquiry or request for any product/ service initiated by the
account holder through any ATM or internet banking or mobile banking application of the
bank or through Third Party Application Providers, which requires two-factor
authentication (2FA) and leaves a trail for audit purposes or successful log-in to the
internet banking/ mobile banking application. Illustratively, this includes transactions such
as change in transaction limit, request for issue of 3 cheque book/ credit card/ debit card,
nomination facility, balance enquiry, etc.
(f) Unclaimed Deposits- The credit balance in any deposit account maintained with banks,
which have not been operated upon for ten years or more, or any amount remaining
unclaimed for ten years or more as mentioned in paragraph 3(iii) of the “Depositor
Education and Awareness” (DEA) Fund Scheme, 2014.
(g) Unclaimed Deposit Reference Number (UDRN)- It is a unique number generated
through Core Banking Solution (CBS) and assigned to each unclaimed account/ deposit
transferred to DEA Fund of RBI. The number shall be such that the account holder or the
bank branch where account is maintained, cannot be identified by any third party

607
4. Annual Review and Steps to be taken in Accounts which are not operated for more
than one year:
4.1 branches shall undertake at least an annual review in respect of accounts, where there
is no customer induced transactions for more than a year. In cases where there is no explicit
mandate to renew the term deposit, the branches should review such accounts if the
customers have not withdrawn the proceeds after maturity or transferred these to their
savings/current account in order to prevent such deposits from becoming unclaimed. The
branches shall inform the account/deposit holders in writing through letters or email or SMS (if
the email and mobile number are registered with the bank) that there has been no operation
in their accounts/deposits in the last one year, as the case may be. The alert messages shall
invariably mention that the account would become ‘inoperative’ if no operations are carried out
during the next one year and, the account holder would be required to submit KYC documents
afresh for reactivating the account in such case.

4.2 If the letters are returned undelivered or no response is received through registered email,
the bank shall immediately undertake an enquiry to find out the whereabouts of account holder
or his/her nominee/legal heirs in case the account holder is deceased.
4.3 In case any response is received from the account holder giving the reasons for not
operating the account, the branches shall continue to classify the account as operative for one
more year and the account holder shall be advised to operate the account within a period of
one year (herein after referred to as ‘extended period’). In case the account holder still fails to
operate the account within the extended period, the branches shall classify the said account
as inoperative account after the expiry of the extended period.
4.4 For the purpose of classifying an account as ‘inoperative’, only customer induced
transactions and not bank induced transactions shall be considered. There may be instances
where the customer has given a mandate like Standing Instructions (SI)/ auto-renewal
instructions and there are no other operations in the Savings /Current account or the Term
Deposit. These transactions shall also be treated as customer induced transactions.
4.5 The classification of an account as inoperative shall be for a particular account of the
customer and not with reference to the customer. In case a customer is maintaining multiple
accounts/deposits with a bank, all such accounts/deposits shall be assessed individually for
the purpose of classifying them as inoperative account/ unclaimed deposit, as the case may
be.
4.6 In case the account holder is not carrying out transaction and the account is - inoperative
due to shifting of primary account to another bank, the account holder may be requested to
provide the details of the new bank account with authorisation to enable the bank to transfer
the balance from the existing bank account.

5. Identification of the Inoperative / Dormant Accounts:

5.1 The Identification of the inoperative accounts is from the point of view of reducing risk of
frauds, etc. in such accounts. However, the customers should not be inconvenienced in any
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way, just because his / her account has been rendered inoperative. The classification is there
only to bring to the attention of dealing staff, the increased risk in the account. The transaction
may be monitored at a higher level both from the point of view of preventing fraud and
making a Suspicious Transactions Report. However, the entire process should remain un-
noticeable by the customer.

5.2 Interest on savings bank accounts shall be credited on regular basis whether the account
is operative or not. If a Term Deposit Receipt matures and proceeds are unpaid, the amount
left unclaimed with the bank will attract savings bank rate of interest if auto renewal facility
at the time of placing the deposit was specifically refused by the customer.

5.3 Amounts lying in inoperative accounts shall be properly audited by the Internal / Statutory
Auditor of the bank.

6. Bank’s Efforts for Activation of Inoperative Accounts:

6.1 Campaigns focusing on activation of inoperative accounts will be launched twice
during a year in the month of May and November to upgrade the accounts to operative
status.

6.2 All inoperative accounts, which are not operated for more than 2 years with a balance
above Rs.1,000 /- will be identified through the system every half year and suitable
communication exhorting the customers to activate their accounts or to get the account
transferred to a branch nearer to them without changing the number (account number
portability) or to indicate their other bank account number, in case they cannot
continue banking relationship with our Bank for any reason.

6.3 In all such cases, where the accounts continue to be inoperative even after sending
a written reminder, the customers will be contacted over phone or in person for getting
the accounts activated and a record thereof shall be maintained at the branch. In cases
where the letters sent by the Bank are returned undelivered, the branch should make
efforts to contact the customer immediately thereafter by approaching the introducer or
the neighbours in the vicinity and getting information on his present whereabouts.

6.4 In all other cases, i.e. accounts with balances up to R s . 1,000/-, system generated
reminders will be sent every year from the date of categorization of accounts as inoperative
and necessary follow-up through phone calls / personal visits to the address given
at the time of account opening / modification for getting the account activated. Help of
the introducer or the neighbours will also be taken to contact the customer for activation of
the account or to get the details of legal heirs in case the account holder is deceased.

6.5 The banks shall make available the facility of updation of KYC for activation of inoperative
accounts/ unclaimed deposits at all branches (including non-home branches) and through
Video-Customer Identification Process (V-CIP) if requested by the account holder, subject to
the facility of V-CIP being provided by the bank. The VCIP related instructions under Master
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Direction - Know Your Customer (KYC) Direction, 2016 dated February 25, 2016 (as updated
from time to time) shall be adhered to by the bank.

6.6 The banks shall activate the inoperative accounts/ unclaimed deposits, including those
which are under freeze by orders of various agencies like Courts, Tribunals, Law Enforcement
Agencies, only after adhering to the KYC guidelines provided in the Master Direction - Know
Your Customer (KYC) Direction, 2016 dated February 25, 2016 (as updated from time to time)
such as Customer Due Diligence (CDD), customer identification, risk categorisation, etc.

6.7 The banks shall ensure that activation of inoperative account/ unclaimed deposits in CBS
necessarily requires second level of authorisation by another officer at the same or higher
level (i.e., through maker and checker). System logs shall invariably be maintained in case of
any activity in or activation of inoperative accounts/unclaimed deposits for concurrent audit
purpose. The preservation period of such system logs shall be as per the internal guidelines
of the bank.

6.8 The bank shall automatically intimate the inoperative account/ unclaimed deposit holders
though SMS and registered email stating that on the basis of the KYC documents submitted
by them, the inoperative status of the account has been removed. The intimation shall also
mention the remedial measures available to them to report unauthorised access, if any. This
would alert the account/ unclaimed deposit holder against any possible fraudulent activity in
his/her inoperative account. The banks shall have in place adequate operational safeguards
to ensure that the claimants in case of inoperative accounts/ unclaimed deposits are genuine.
The banks shall process requests for activation of inoperative account/ unclaimed deposits
within three working days from the receipt of the complete application.
7. Operations in Inoperative / Dormant Account:
7.1 Operations in inoperative / dormant accounts may be allowed after due diligence as per
risk category of the customer. Due diligence would mean ensuring genuineness of the
transaction, verification of the signature and identity etc. However, it has to be ensured that
the customer is not inconvenienced as a result of extra care taken by the bank.

7.2 When a request for activation of a dormant account is received, approval for activation
should be accorded by a designated officer at the branch. He / she will verify and satisfy
himself / herself that the account was opened in a KYC compliant manner and the reasons
adduced by the account holder for not operating the account are genuine. Documentary
evidence of new residential proof shall be obtained, if the depositor could not be contacted at
the last address furnished to the Bank. Further, the amount of deposit available in the account
should commensurate with the occupation level of the customer, as declared in the account
opening form.
Note: As the account turns to dormant since no customer induced transactions are done in
the account for last two years, branches should invariably advise the customer to do the at
least one transaction after activation of account else account will continue to be classified as
dormant
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7.3 Charges for account activation and penal charges for non-maintenance of minimum
balances are not applicable in inoperative / dormant accounts.
7.4 No charges shall be levied for activation of inoperative accounts.
7.5 Payment of Interest Interest on savings accounts shall be credited on a regular basis
irrespective of the fact that the account is in operation or not.

8. Treatment of Certain Savings Bank Accounts Opened for Credit of Scholarship

Amounts and Credit of Direct Benefit Transfer under Government Schemes:
8.1 In view of difficulties faced by State / Central Government in crediting Cheques / Direct
Benefit Transfer / Electronic Benefit Transfer / Scholarships for students, etc. into accounts /
accounts opened with zero balance for the beneficiaries under various Central / State
Government schemes due to non-operation of such accounts over two years and thereafter
classification of such account as dormant / inoperative, RBI had advised not to classify all such
accounts as Inoperative / Dormant by allotting a different “product code” in Bank’s Core
Banking System.

8.2 In order to reduce the risk of fraud etc., in such accounts, while allowing operations in
these accounts, due diligence should be exercised by the branches to ensure genuineness of
transactions, verification of signature and identity, etc. However, it has to be ensured that the
customer is not inconvenienced in any manner
9. DEPOSITOR EDUCATION AND AWARENESS FUND SCHEME (DEAF) - 2014:
9.1 In terms of announcement of Monetary Policy 2013-14 and pursuant to the enactment of
the Banking Laws ( Amendment) act , 2012, Section 26A has been inserted in the Banking
Regulation Act, 1949,which inter alia empowered Reserve Bank of India to establish The
Depositor Education and Awareness Fund (the Fund). The same is notified by Government
of India on May 24, 2014 and the scheme is operationalized from 24 th May 2014.
9.2 Under the provisions of this section, the credit amount of any accounts with bank which
has not been operated upon for a period of ten years or any deposit or any amount remaining
unclaimed for more than ten years, including the accrued interest that the bank would have
been required to pay to the customer / depositor as on the date of transfer shall be credited /
transferred to the Fund maintained with RBI on monthly basis. Bank has carried out first
transfer to the Fund on 30th June 2014. Since onwards, Bank is needed to transfer / credit the
fund to RBI on monthly basis. Monthly statement on the amount transferred / credited in the
fund shall be submitted to RBI, after duly certified by concurrent auditor.
9.3 The credit balances of following (Interest bearing Deposit, Non-Interest bearing
Deposit & Other Credit items) accounts including customer accounts shall be credited /
transferred to the fund.
 saving bank deposit accounts;
 fixed or term deposit accounts;
 recurring deposit accounts;
 current deposit accounts;
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  other deposit accounts in any form or with any name;
 cash credit accounts;
 loan accounts after appropriation by the banks;
 margin money against issue of Letter of Credit / Guarantee etc., or any security
deposit;
 outstanding telegraphic transfers, mail transfers, demand drafts, pay orders, banker
cheques, sundry deposit accounts, Vostro accounts, inter-bank clearing
adjustments, unadjusted National Electronic Funds Transfer(NEFT) credit
balances and other such transitory accounts, unreconciled credit balances on
account of Automated teller Machine (ATM) transactions, etc.;
 undrawn balance amounts remaining in any prepaid card issued by banks but not
amounts outstanding against travellers cheques or other similar instruments, which
have no maturity period;
 rupee proceeds of foreign currency deposits held by banks after conversion of
foreign currency to rupees in accordance with extant foreign exchange regulations;
and
 such other amounts as may be specified by the reserve Bank from time to time.
9.4 Any amount payable in foreign currency under an instrument or a transaction, that has
remained unclaimed for ten years or more, shall at the time of transfer to the Fund be
converted into Indian Rupees at the exchange rate prevailing on that date and in the event of
a claim, the Fund shall be liable to refund only the Indian Rupees received by the Fund with
respect to such instrument or transaction.

10. PROCEDURE FOR TRANSFERRING / CREDITING THE AMOUNT TO THE DEAF.

10.1 Own Account
Bank shall transfer the eligible amount to the Fund in electronic form through portal facility of
the E-Kuber ( CBS portal of RBI) by furnishing Bank’s DEAF Code and detailed break up (
number of accounts and amount) of the deposits viz. Interest bearing, non-interest bearing
deposits and other credits on the last working day of the month.

10.2 Members’ Account (RRBs - Sponsored by BOI)

Same procedure as above shall be adopted while transferring the amount dues of each
member bank to DEA Fund without consolidating the amounts of all member banks.

11. RETURNS PRESCRIBED FOR SUBMISSION TO RESERVE BANK OF INDIA (RBI)

Bank shall furnish different returns as below to Reserve Bank of India, even if it is nil return at
the periodicity indicated by RBI in the form and manner as prescribed by Reserve Bank of
India (RBI) from time to time certified by Concurrent Auditor.

FORM I- Monthly return of unclaimed deposits/credits/accounts/in India which have not been
operated upon/remained unclaimed for 10 years or more as on the date of return and
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transferred to DEA Fund Account. (to be submitted online to the Reserve Bank of India by
15th of the succeeding month).
FORM II- Monthly return claiming refund from the DEA Fund. (to be submitted online on or
before 10th of the succeeding month to which the claim pertains and original hard copy duly
signed by Board Approved authorized signatories and audited by Concurrent Auditor, to be
submitted by 25th of the succeeding month to which the claim pertains.
FORM III- Certificate of Reconciliation of balances for the half year ended September/March,
original hardcopy duly signed by 2 executives other than the authorized signatories and
audited by the Concurrent Auditor (to be submitted in of the succeeding).

12. Guidelines & Procedure for Claim of Unclaimed Deposits transferred to DEAF
Interest Bearing Deposit, Non-Interest Bearing Deposit
12.1 In respect of unclaimed amount transferred to the Depositor Education and Awareness
Fund (DEAF), Bank shall be liable to repay a depositor or any other claimant ( Nominee / Legal
Heir(s) , claiming his deposit or unclaimed amount along with interest payable, if any, at such
rate of interest as may be specified by the Reserve Bank of India in this behalf.

Interest payable on interest bearing deposits transferred to RBI DEA Fund in the table below:
Period Rate of Interest p.a
Up to June 30,2018 4%
July 1, 2018 up to May 10, 2021 3.5%
From May 11, 2021 till the time of payment to 3%
the depositor/ claimant

Where Bank has paid such amount or allowed operation of such account or deposit, bank will
lodge a claim for refund of such amount from the DEA fund.
Branches shall take prescribed Unclaimed Deposits / Inoperative Accounts- Claim Form
(Annexure-1) along with following documents from claimants before crediting the unclaimed
deposits transferred to DEAF by using FINACLE menu: BRDEAF.
 Pass Book / Account Statement / TDR receipt
 Official Valid Doc (OVD)
 Death Certificate of deceased depositor (if claimant is Nominee / Legal heir(s))

12.2 Claim Process:

The customer / survivor / legal heir / authorised signatories, as the case may be lodge
a claim for the unclaimed deposit. The claim process is as follows:
 Claim by Self: Depositors can visit the branch of the bank and submit the unclaimed
deposits claim form (Annexure-1) duly filled and signed, along with any other required
documents as may be requested by the bank for identity of claimant.
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  Claim by Legal Heir / Nominee: For the claim process, the Legal heir / Nominee can
visit the branch of the Bank and submit the unclaimed deposits claim form (Annexure-
1) duly filled and signed, along with copy of death certificate of deposit holder and any
other required documents as may be requested by the bank for identity of claimant.
Note: Bank has to comply with claim settlement process as per Bank’s Policy on Model
Operational Procedure for Settlement of Claims in Deceased Depositors Account’s.
 Claim by Non-Individual: For the claim of Non-Individual accounts, the customer
needs to submit the unclaimed deposits claim form (Annexure-1) on the Company’s
/ Firms/ Institution’s letterhead duly signed by the authorised signatories along with
any other required documents as may be requested by the bank for identity of
claimants.

At the time of submission of claims the original documents have to be produced for
the purpose of verification at the branch.
Other Credit Items (Amount in Internal Office Accounts etc.)
12.3 In respect of unclaimed amount (other credit items like amount in Internal Office accounts
etc.,) transferred to the Depositor Education and Awareness Fund (DEAF),Zones/FGMOs
/Department at Head Office shall follow below guidelines for claiming the amount:-

 All claim initiated from Zonal Offices shall be routed through their respective FGMOs
with recommendation in the prescribed claim application (Annexure-II) and duly
signed by ZM/DZM.
 FGMOs/ Department at HO shall forward the claim application directly to HO-General
Operations Department with their approval.
On receipt of the approved application from Department at HO / FGMOs, HO-
General Operations Dept. shall instruct the BKC branch ( as 01220GENUS596
account maintained with them) to transfer the claimed funds to the respective
Zones/FGMOs/Department at HO.
12.4 The interest payable, if any, from the Fund on a claim shall accrue only from the date on
which the balance in an account was transferred to the Fund to the date of payment to the
customer / depositor. No interest shall be payable in respect of amounts refunded from the
Fund, where no interest was payable by the bank to customer / depositor.
12.5 In the case of a claim for refund of foreign currency denominated deposit accounts,
instruments or transactions specified in paragraphs 9.3 above, the bank shall be entitled to
claim refund of the eligible amount from the Fund, in Indian rupees only.

12.6 As per Reserve Bank of India (RBI) direction, Bank has authorized any two (jointly) out
of the designated officials as authorised signatories to operate the account for the claims /
refund on behalf of the bank from the Fund. Accordingly refunds made by the bank in each
614
calendar month shall be claimed for reimbursement from the Fund on the last working day of
the subsequent month by authorised signatories.

12.7 Claim from DEA Fund: HO- General Operations Dept. shall claim the amount (on
monthly basis, 10th of succeeding month) transferred to DEA fund and credit the G/L suspense
account 01220GENUS596 upon receipt of the funds from RBI to reconcile the account.

13. Audit
13.1 The accounting year for the Fund shall be from April 1 to March 31 of the subsequent
year.
13.2 On the date of transferring the amount to the Fund, the bank shall maintain customer-
wise details verified by the concurrent auditor, including payment of up-to-date interest
accrued, that has been credited to the deposit account till the date of transfer to the Fund, with
respect to interest bearing deposits.
13.3 With respect to non-interest bearing deposits and other credits transferred to the Fund,
customer-wise details, duly audited, shall be maintained with the bank.
13.4 The concurrent auditor shall also verify and certify that, as per the banks' books, the
returns have been correctly compiled by the bank in the monthly and yearly returns submitted
to RBI.
13.5 All the returns shall be verified by the statutory auditors at the time of annual audit and an
Annual Certificate shall be obtained from statutory auditors and shall be forwarded to RBI,
certifying that the returns have been correctly compiled by the bank.
14. Disclosure in Notes to Accounts
As per the Reserve Bank of India’s direction, Bank shall reflect all unclaimed liabilities (where
amount due has been transferred to DEAF) as “Contingent Liability – Others, items for which
the bank is contingently liable” under Schedule 12 of the annual financial statements.
15. Display of List of Inoperative / Unclaimed Accounts on Bank’s Website:
15.1 As per the RBI Notification No. RBI/2023-24/105 DOR.SOG
(LEG).REC/64/09.08.024/2023-24 and RBI /2014-15/442 DBR. No. DEA Fund
Cell.BC.67/30.01.002/2014-15 dated 02.02.2015 regarding display of list of unclaimed/
inoperative accounts, Banks shall host the details of unclaimed deposits {only name, address
(without pin code) and Unclaimed Deposit Reference Number (UDRN)}, which have been
transferred to DEA Fund of RBI on their respective websites, which shall be updated regularly,
at least on a monthly basis. The banks, which do not have their own websites shall make
available the above list of unclaimed deposits in their respective branches. The database
hosted on the website shall provide a search option to enable the public to search for their
unclaimed deposits using name in combination with the address of the account holder/ entity.
Upon a successful search, details of unclaimed deposits shall be displayed in a format
comprising account holder’s name(s), his/her address (without pincode) and UDRN only. In
case such accounts are not in the name of individuals, the search input and result should
615
include names of individuals authorised to operate the accounts. However, the account
number, its type, outstanding balance and the name of the branch shall not be disclosed on
the bank’s website
15.2 Bank shall also display the information on the process of claiming the unclaimed
deposit/activating the inoperative account and necessary forms and documents for claiming
the same on the Bank’s Website.
15.3 Depending on the concentration of unclaimed deposits, zonal offices have a designated
cell to provide focused attention for claim of amount transferred to DEAF. Branch has to be
ensured that the claimant (Nominee/ Survivor) is not inconvenienced at the time of claim of
fund transferred to DEAF.

16. Reporting to RBI:

Section 26 of the Banking Regulation Act, 1949 provides, inter alia, that every banking
company shall, within 30 days after close of each calendar year submit a return in the
prescribed form and manner to the Reserve Bank of India as at the end of each calendar year
(i.e., 31st December) of all accounts in India which have not been operated upon for 10 years.
17. Preservation of Records:
Notwithstanding anything contained in the Banking Companies (Period of Preservation of
Records) Rules, 1985, bank shall preserve records / documents containing details of all
accounts and transactions, including deposit accounts in respect of which amounts are
required to be credited to the Fund permanently; and where refund has been claimed from the
Fund, bank shall preserve records / documents in respect of such accounts and transactions,
for a period of at least five years from the date of refund from the Fund.
18. Segregation and Audit of Inoperative Accounts/ Unclaimed Deposits
18.1 The segregation of inoperative accounts is required to be done to reduce the risk of
frauds. The transactions in inoperative accounts, which have been reactivated, shall be
monitored regularly, for at least six months, at higher levels (i.e. by controlling authorities of
the concerned branch) without the knowledge and notice of the customers and the dealing
staff.
18.2 The branch shall ensure that amounts lying in inoperative accounts/unclaimed deposits
and reactivated inoperative accounts/ unclaimed deposits, are subjected to concurrent audit.
19. Tracing of Customers of Inoperative Accounts/ Unclaimed Deposits
19.1 The bank shall contact the holder(s) of the inoperative account/ unclaimed deposit
through letters, email or SMS (if the email and mobile number are registered with the bank).
616
The email/ SMS shall be sent on a quarterly basis.

19.2 In case the whereabouts of the holder(s) of the inoperative account/ unclaimed deposit
are not traceable, the branch shall contact the introducer, if any, who had introduced the
account holder to the bank at the time of opening of the account. The branches shall also
contact the nominee, if registered, for tracing the customer.

19.3 The branches shall undertake special drives periodically to find out the whereabouts of
the customers, their nominees or legal heirs in respect of inoperative accounts / unclaimed
deposits.

20. Fraud Risk Management in Inoperative Accounts :

20.1 The banks shall not allow any debit transaction in an inoperative account unless there is
a customer induced activation as per the procedure mentioned in paragraph 6 of these
guidelines. Further, banks may also consider imposing a cooling-off period on reactivation,
with restrictions on the number and amount of transactions, as may be applicable for newly
opened accounts with the bank.

20.2 The banks shall ensure that there is no unauthorised access to customer data pertaining
to the inoperative accounts. The banks shall also ensure that adequate steps are taken to
prevent data theft and related misuse for fraudulent purposes.

21. Customer Awareness:

21.1 The banks shall provide on their website as well as at their branches, the information on
the process for activation of the inoperative account/ unclaimed deposits and claiming the
balances therein. Necessary claim forms and documents may be made available for the
benefit of customers.

21.2 The banks shall conduct public awareness and financial literacy campaigns regularly to
educate the members of public about the activation of inoperative accounts/unclaimed
deposits and the prescribed procedure to claim amounts lying therein by a depositor or his/her
nominee/ legal heir in case of deceased depositor

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 Annexure – 1
UNCLAIMED DEPOSITS / INOPERATIVE ACCOUNTS- CLAIM FORM
To, Address for correspondence
The Branch Manager, Name:
Bank of India Address:
___________Branch

Contact No.
Email ID.
Date.

Dear Madam / Sir,

I / We the undersigned Mr. /Mrs. / Ms.________________________________in the

capacity of self / Nominee / Legal Heir / Others (please specify) request for the activating
/ payment of the balance amount from my / our / deceased account held with your bank
in the name of Mr. / Mrs. /Ms. ____________________________.

No. Nature of Deposits Account No. Nature of Liability to Amount

the Bank, if any
1.

2.
3.

Total Amt.

Document Submitted: Pass Book / Account Statement / TDR receipt / Official Valid Doc(OVD)
/ Death Certificate of deceased depositor (if claimant is Nominee / Legal heir(s))

Type of Document Name of Official Valid Doc. (OVD) Reference no.

Identification Proof

Address Proof

Death Certificate of Deceased Depositor

Declaration:
618
  I / We declare that the facts stated above are true and correct to the best of my/our
knowledge and belief.

 I / We certify that the unclaimed account as per details displayed on the website
of the bank belongs to me / us and as owners of the account i/we claim the amount
from the account.

 I / We also understand that i/we will be required to procure all documents desired
to establish my/our claim till settlement and agree to execute the required
documents to settle the claim

 I / We understand that claim will be settled post due diligence and authentication
of documents and in subject to bank’s process & policy.

Signature (s) of the claimant (s):

S. No. Name of the Claimant Signature

Place: _____________
Date: _____________

Encl: As above.

(Two Bank acceptable witness is required in case of claimants(s) are illiterate)

Note :The Bank is not responsible for any delay in disposal of the claim due to lack of full particulars furnished in this
application (If the space provided is insufficient, please use additional sheet)

Customer Acknowledgment slip (to be filled in by Bank official)

619
 Date:

Received a request from Mr./Mrs./Ms. ____________________________ for claiming

Unclaimed Deposits/Inoperative Accounts.

Bank of India Signature of Bank Official with Bank seal

______________Branch

FOR OFFICE USE

I have made necessary inquiries / verification about the claim made by the self /
nominee / survivor(s) & satisfied that the claim can be settled. All the necessary
documents have been obtained. The claim may be paid to the self / nominee /
survivor(s).

Any other remarks:

Place:

Date:

Signature Signature

Name Name
Designation: Designation:
(Recommending Authority (Verifying Authority )

Note: Branches are advised to use BRDEAF menu for claim of unclaimed deposits of
depositor/s.

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 Annexure
-II
CLAIM FORM
FOR AMOUNT TRANSFERRED TO DEA FUND UNDER OTHER CREDIT ITEMS

Subject: Claim of amount transferred to DEA Fund from GL/PL account no.__________
Synopsis/Summary:
With reference to above we would like to inform you that as per RBI DEAF Guidelines
following amount was transferred to DEA fund from GL/PL account no.____________
of branch/office___________.

S.N Date GL/PL account no Amount

Now, we request you to claim back the above amount from DEA Fund.
Reason / Justification and Recommendation for seeking refund:

In this regard, you undertake that:-

 Claim back of fund is as per RBI DEAF guidelines.
 The said claim has not been made earlier or received from the DEA Fund.

Signature of Recommending Authority at Signature of Approving Authority at

Zones / FGMOs/ Owner Department at Head FGMOs/ Owner Department at Head
Office Office

621
 Annexure-
III

Financial Transactions:

S.N Type of Transactions

1 ATM/ Cash withdrawal/deposit
2 RTGS / NEFT/ IMPS /UPI/ AePS/ ABPS Transactions
3 Internet Banking Transactions
4 Debit Card Transactions
5 Transfer of funds from / to the linked CBDC(e-Rupee) account
6 Cheque Clearing
7 Remittance of funds by way of demand drafts
8 Cash withdrawal by third party through cheque
9 Standing Instructions issued by the customer
10 NACH Debit / Credits
11 Term Deposit Interest / proceeds
12 Dividend on shares/Interest on Debentures or any other investment proceeds
13 Direct Benefit Transfer (DBT) credits
14 Refunds like refunds related to e-commerce payments, Income Tax Returns,
etc
15 National Electronic Toll Collection (NETC) debits

Non-Financial Transaction:

An enquiry or request for any product/ service initiated by the account holder through
any ATM or internet banking or mobile banking application of the bank or through
Third Party Application Providers, which requires two-factor authentication (2FA)
and leaves a trail for audit purposes or successful log-in to the internet banking/
mobile banking application. Illustratively, this includes transactions such as change
in transaction limit, request for issue of 3 Cheque book/ credit card/ debit card,
nomination facility, balance enquiry, etc.

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