reserve Bank of India
A question often arises regarding the amount deposited in bank accounts that if both the account holder and the nominee named by him die, then who is entitled to that money. Clear guidelines have been given in the Reserve Bank of India (RBI) and banking laws regarding this situation, so that even in such circumstances the money can reach the right person safely.
According to the rules, if both the account holder and the nominee die, the amount deposited in the bank is given to the legal heirs of the person concerned. The role of the nominee is only that of a trustee, that is, he is a medium to transfer the amount to the real heirs and not the ultimate owner. This was justified by the Supreme Court in the year 1984 in the Sarbati Devi VS Usha Devi case. If there is no nominee, then the direct legal heirs get the rights over the property i.e. money.
How is the heir decided?
Now the question is that if the heir wants to get the money then what are the rules for identifying the heir? The identity of the heirs is decided in two ways. If the deceased has made a will, then the property is divided on the basis of that. Whereas, in the absence of a will, relevant succession laws apply, such as the Hindu Succession Act, 1956, which determines who will have rights over the property. Since the rules of succession are different in different religions, it is decided accordingly.
In such a situation, the heirs have to make a claim to get the money from the bank. For this, documents like death certificate, identity card and legal hair certificate or succession certificate have to be submitted. The bank may also get additional formalities completed as per its rules, to ensure that the amount is being given to the right person only.
In this situation the account is unclaimed
If no one claims this amount for a long time, the account goes into unclaimed category. As per RBI rules, the unclaimed amount for 10 years is transferred to the Depositor Education and Awareness Fund (DEAF). However, even after this the actual heirs can make a claim anytime with the necessary documents and get the money.
RBI has instructed banks to keep the claim process simple and transparent in such cases, so that customers and their families do not have to face unnecessary hassles. This is why it is considered very important to update the nominee on time and keep the important documents organized.
If nominee is not made then who will get the money
If you have not made anyone a nominee while opening a bank account, then after the death of the account holder, his legal heirs have the right over that money. Usually this right goes to parents, spouse or children. However, to get the money, the person concerned has to prove that he is the legal heir of the deceased by providing necessary documents. For this, identity card, proof of relationship or other legal documents have to be submitted, so that it can be ensured that the amount is being given to the right person only.
In case of joint account the process is different. If one of the account holders dies, the other account holder can completely operate that account and has the same rights. For this he has to submit the death certificate of the deceased in the bank. After the documents are submitted, the bank updates the records and the name of the deceased is removed from the account.
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