FOUNDATION MAGAZINE FINANCIAL ADVICE STOCKLETTERS PORTFOLIO PMS BOOKS
BUY
Unclaimed Deposits: SC Allows Prashant Bhushan To File a Rejoinder on PIL Seeking Steps To Inform Legal Heirs
Moneylife Digital Team 28 April 2023
Consumer Interest
Terming the issue of unclaimed deposits as 'very large', the Supreme Court on Friday allowed senior counsel Prashant Bhushan to file a combined rejoinder in a public interest litigation (PIL) filed by Sucheta Dalal, managing editor of Moneylife and founder-trustee of Moneylife Foundation. Senior counsel Bhushan is representing Ms Dalal. The PIL is about unclaimed funds of investors and depositors, which are taken by various regulators and are not accessible to the rightful legal heirs of such funds. 
 
During the hearing, justice PS Narasimha mentioned that "This issue is very large. It is being considered in detail."
 
Earlier this month, the apex court had allowed three weeks for the ministry of finance (MoF) to file a counter-reply. 
 
The bench of chief justice DY Chandrachud noted that the ministry of corporate affairs (MCA) filed its affidavit. However, the counsel for the MoF requested time to file a counter reply. 
 
The plea, taken up by senior counsel Bhushan, is about making public on centralised platform details of unclaimed money of investors and depositors taken by various regulators and remains inaccessible to rightful legal heirs. 
 
In her plea, Ms Dalal contended that unclaimed funds of the public get transferred to government-owned funds like the Depositor's Education and Awareness Fund (DEAF), Investor's Education and Protection Fund (IEPF) and Senior Citizen's Welfare Fund (SCWF) on the ground that the legal heirs or nominees did not claim them, should be made available to the legal heirs or nominees by providing information of holders of inoperative or dormant accounts on a centralised online database.
 
The petition urges developing a centralised online database under the control of RBI that will provide information about the deceased account holder, including such details as the name, address and last date of transaction by the deceased account holder. Further, it should be mandatory for banks to inform RBI about the inoperative or dormant bank accounts, and this exercise should be repeated after an interval of nine to 12 months. (Read: SC Issues Notice on Plea By Sucheta Dalal That Information on Unclaimed Amounts Lying in Dormant Accounts Be Made Publicly Available on a Centralised Platform)
 
In response to the petition, the Reserve Bank of India (RBI) submitted that, during FY21-22, the depositors' education and awareness fund (DEAF) refunded Rs505.51 crore of 187,975 claimants. According to RBI, settling disputed claims by banks may involve adjudication of facts and appreciation of evidence which are normally subject matters of the court and could lead to avoidable litigation involving the banks, which is not in the interest of the banks and their depositors.
 
Earlier this month, RBI governor Shaktikanta Das announced the development of a common web portal to search for unclaimed deposits. According to the Union government, the total unclaimed deposits transferred to RBI by the public sector banks (PSBs) as of February 2023 was Rs35,012 crore.
 
At present, the depositors or beneficiaries of unclaimed bank deposits of 10 years or more have to go through the websites of multiple banks to locate such deposits, Mr Das said.
 
"Now, in order to improve and widen the access of depositors and beneficiaries to information on such unclaimed deposits, it has been decided to develop a web portal to enable search across multiple banks for possible unclaimed deposits. This will help depositors and beneficiaries in getting back unclaimed deposits," he added. (Read: RBI To Develop a Centralised Portal To Search Unclaimed Deposits)
 
Comments
vmehtaudctbby
3 years ago
Fully agree with you, amodi. Even KYC details are not being registered and silly objections are raised. Share holders are reduced to clerks and prunes. I earnestly request Sucheta Dalal to take up this issues of KYC procedure. RTA dont take On Line submissions and insist for KYC documents for each folios for each companies where shareholder details are same!! SEBI revised ISR 1 form but RTA still not obeying the same. RTA must update KYC of each share holder (once approved by it) in all the folios of all the issuers that they manage rather insist for physical documents for every case (folios).
Reply
amodi
3 years ago
Infact what is observed is that investors money is being diverted to the government funds without any effort of informing them even after all KYC/ nominee details being available due to malicious intentions . There is no suitable platform for resolving such cases and the depositors have to keep on running from pillar to post in our country.
I can provide a glaring example of such a case if desired and if it helps the judiciary.
Reply
vmehtaudctbby
Replied to amodi comment 3 years ago
Fully agree with you, amodi. Even KYC details are not being registered and silly objections are raised. Share holders are reduced to clerks and prunes. I earnestly request Sucheta Dalal to take up this issues of KYC procedure. RTA dont take On Line submissions and insist for KYC documents for each folios for each companies where shareholder details are same!! SEBI revised ISR 1 form but RTA still not obeying the same. RTA must update KYC of each share holder (once approved by it) in all the folios of all the issuers that they manage rather insist for physical documents for every case (folios).
Reply
ICICI Pru
ICICIBank Coral credit cr
  • EDITORS'
    PICKS
  • MOST
    POPULAR
  • MOST
    READ
Free Helpline
Legal Credit
Feedback
Buy Now!

Absolute Power

Inside story of the National Stock Exchange’s amazing success, leading to hubris, regulatory capture and algo scam

View Options

The Scam: Now in it's 12th Printing

29 Years Of The Scam: The Perennial Bestseller, reads like a Thriller!
#Scam92: Read the actual story.

Buy Now Gift Know More

Moneylife Online Magazine

Fiercely independent and pro-consumer information on personal finance.

1-year online access to the magazine articles published during the subscription period.
Access is given for all articles published during the week (starting Monday) your subscription starts. For example, if you subscribe on Wednesday, you will have access to articles uploaded from Monday of that week.
This means access to other articles (outside the subscription period) are not included.
Articles outside the subscription period can be bought separately for a small price per article.

Buy Now Gift Know More

Monthly Digital Access

Fiercely independent and pro-consumer information on personal finance.

30-day online access to the magazine articles published during the subscription period.
Access is given for all articles published during the week (starting Monday) your subscription starts. For example, if you subscribe on Wednesday, you will have access to articles uploaded from Monday of that week.
This means access to other articles (outside the subscription period) are not included.
Articles outside the subscription period can be bought separately for a small price per article.

Buy Now Know More

Full Archive access

Fiercely independent and pro-consumer information on personal finance.
Complete access to Moneylife archives since inception ( till the date of your subscription )

Buy Now

Stockletters in 5 Flavours

Outstanding research that beats mutual funds year after year

Buy Now Know More

MAS: Complete Online Financial Advisory

(Includes Moneylife Online Magazine)

Buy Now Know More
We are listening!
Reset
Success!

To continue

Please

or

With