Negotiable Instruments Act 1881

The Negotiable Instruments Act 1881 came into force w.e.f 1.3.1882. It has 147 sections. Sec 138 to 142 were added on 1.4.1989 and Sec 143 to 147 was added in December 2002. The NI Act, 1881 is applicable to the whole of India.

What is “Negotiable Instrument”?

As per Sec.13 of Negotiable Instruments (NI) Act a “Negotiable Instrument” means a promissory note, bill of exchange or cheque payable either to order or to bearer.

Negotiable Instruments include:

1.    Promissory Note;

2.    Bill of Exchange; and

3.    Cheque.

→NEGOTIABILE INSTRUMENTS		→NOT-NEGOTIABLE INSTRUMENTS
1	Bank Draft	1	Fixed Deposit Receipt
2	Govt. Promissory Note	2	Share Certificate
3	Bill of lading	3	Withdrawal Slip from SB Account.
4	Share warrants & Dividend warrants	4	LIC Policy
5	Treasury Bills	5	Airway Bill
6	Hundi	6	Document of Title to immovable property
7	Certificate of Deposit & Commercial Paper	7	Currency Note: This itself is money (Sec 21 of Indian Currency Act)

As per Sec.11 of Indian Contract Act, 1872 a minor, a person of unsound mind (lunatic) and an un-discharged insolvent are not eligible for making a valid contract. However, u/s 26 of NI Act “a minor may draw, endorse and negotiate a negotiable instrument so as to bind all parties except himself.”

UCO Bank’s Anti Money Laundering Policy

UCO Bank’s Anti Money Laundering Policy is in operation since 20.11.2002. KYC guidelines are important features of the policy. The main provisions of the policy are summarized below.

OBJECTIVES: –

1. To protect the Bank from being used for money laundering.

2. To adhere to the internationally accepted “Know Your Customer” policies and procedures in the day to day business.

3. To take appropriate action when suspicious activity is detected and to report to the designated authorities.

4. To comply with applicable laws as well as norms adapted internationally by banks and financial institutions as per the “forty recommendations” of FATF.

5.  Employees will conduct themselves in accordance with the highest ethical standards.

6. They should not knowingly provide advice or other assistance to those who indulge in money laundering.

7.  Employees who suspect money-laundering activities should refer the mater to Anti Money Laundering compliance officer. There shall be one identified compliance officer in each branch and in each Regional Office.

8.  “Know Your Customer” is an integral part of Anti Money Laundering policy.

APPLYING TO BANKING OMBUDSMAN

0. When can the complainant file his/her complaint?

S/He can file his/her complaint before the Banking Ombudsman if the reply is not received from the bank within a period of one month, after the bank concerned has received his/her representation, or the bank rejects the complaint, or the complainant is not satisfied with the reply given to him/her by the bank.

1. Does the complainant have to fulfill any conditions before complaining to the Banking Ombudsman?

For filing a complaint before the Banking Ombudsman, it is essential for a complainant to first attempt to find a satisfactory solution directly with his/her bank by making a written representation to the bank named in the complaint. The complaint should, however, be made before expiry of period of one year after the cause of action has arisen.

2. Can a complaint be made before a Banking Ombudsman on the same subject matter settled through pervious proceedings before any of the Banking Ombudsmen?

No. The complaint should not be for the same subject matter that was settled through the office of the Banking Ombudsman in any previous proceedings.

3. Can a complaint be made before a Banking Ombudsman on the same subject matter for which any proceedings before any court, tribunal or arbitrator or any other forum is pending or a decree or award or a final order, has already been passed by any such competent court, tribunal, arbitrator or forum?

No.

4. Is there any procedure for filing the complaint before the Banking Ombudsman?

A complainant can file a complaint with the Banking Ombudsman simply by writing on a plain paper. S/He can also file it online (at www.bankingombudsman.rbi.org.in or by sending an email to the Banking Ombudsman. There is also a prescribed form for filing a complaint, which is available with all the branches of the banks. However, it is not necessary to use this format. The complainant should, however, incorporate all the required information.

5. Can a complaint be filed by an authorized representative of the complainant?

Yes. The complainant can be filed by an authorized representative (other than an advocate) of the complainant.

6. Is there any cost involved in filing complaints with Banking Ombudsman?

No. The Banking Ombudsman does not charge any fee for resolving customers’ complaints.

7. What details are required in the application?

The complaint should have the name and address of the complainant, the name and address of the branch or office of the bank against which the complaint is made, facts giving rise to the complain supported by documents, if any, the nature and extent of the loss caused to the complainant, the relief sought from the Banking Ombudsman and a declaration about the compliance of conditions which are required to be complied with by the complainant.

TYPES OF COMPLAINTS BEFORE BANKING OMBUDSMAN

The Banking Ombudsman can receive and consider any complaint relating to the following deficiency in banking services:

•           Non-payment or inordinate delay in the payment or collection of cheques, drafts, bills, etc.

•           Non-acceptance, without sufficient cause, of small denomination notes tendered for any purpose, and for charging of commission for this service;

•           Non-acceptance, without sufficient cause, of coins tendered and for charging of commission for this service;

•           Non-payment or delay in payment of inward remittances;

•           Failure to issue or delay in issue, of drafts, pay orders or bankers’ cheques;

•           Non-adherence to prescribed working hours;

•           Failure to provide or delay in providing a banking facility (other than loans and advances) promised in writing by a bank or its direct selling agents;

•           delays, non-credit of proceeds to parties' accounts, non-payment of deposit or non-observance of the Reserve Bank directives, if any, applicable to rate of interest on deposits in any savings, current or other account maintained with a bank ;

•           delays in receipt of export proceeds, handling of export bills, collection of bills etc., for exporters provided the said complaints pertain to the bank's operations in India;

•           Refusal to open deposit accounts without any valid reason for refusal;

•           levying of charges without adequate prior notice to the customer;

•           Non-adherence by the bank or its subsidiaries to the instructions of Reserve Bank on ATM/debit card operations or credit card operations;

•           non-disbursement or delay in disbursement of pension to the extent the grievance can be attributed to the action on the part of the bank concerned, (but not with regard to its employees);

•           Refusal to accept or delay in accepting payment towards taxes, as required by Reserve Bank/Government;

•           Refusal to issue or delay in issuing, or failure to service or delay in servicing or redemption of Government securities;

•           forced closure of deposit accounts without due notice or without sufficient reason;

•           Refusal to close or delay in closing the accounts;

•           Non-adherence to the fair practices code as adopted by the bank; and

•           any other matter relating to the violation of the directives issued by the Reserve Bank in relation to banking or other services.

•           Deficiency in Internet banking services

•           Non-adherence to the provisions of Fair Practices Code for lenders as adopted by the banks or Code of Banks Commitment to Customers

•           Non-observance of Regulatory guidelines on engagement of recovery agents by the banks

Note: The Banking Ombudsman will consider complaints from Non-Resident Indians having accounts in India in relation to their remittances from abroad, deposits and other bank-related matters.

Thanks!!

British Prime Minister Bejamin Disrael said “You will never go higher than your thinking.”

Banking Ombudsman Scheme, 2006

1. What does the Banking Ombudsman Scheme, 2006 offer?

The Banking Ombudsman Scheme, 2006 enables resolution of complaints of bank customers relating to certain services rendered by banks.

2. Has the Banking Ombudsman Scheme come into effect?

The Scheme has come into force from January 1, 2006.

3. Who is a Banking Ombudsman?

The Banking Ombudsman is person appointed by the Reserve Bank of India to redress customer complaints against certain deficiency in banking services.

4. Does the Banking Ombudsman have any legal power?

The Banking Ombudsman is a quasi judicial authority. It has power to summon both the parties - bank and its customer, to facilitate resolution of complaint through mediation.

5. How many Banking Ombudsmen have been appointed and where are they located?

As on date, 15 Banking Ombudsmen have been appointed with their offices located mostly in the State Capitals. The addresses of the Banking Ombudsman offices have been provided in the RBI website.

6. Which banks are covered under the Banking Ombudsman Scheme, 2006?

All Scheduled Commercial Banks, Regional Rural Banks and Scheduled Primary Co-operative Banks are covered under the Scheme.

7. How is the new Banking Ombudsman Scheme, 2006 different from the Old Banking Ombudsman Scheme, 2002?

The extent and scope of the new Scheme is wider than the earlier Scheme of 2002. The new Scheme also provides for online submission of complaints. The new Scheme additionally provides for the institution of an 'appellate authority' for providing scope for appeal against an award passed by the Ombudsman both by the bank as well as the complainant.

Dishonour /Return of cheques: Need to sign/Initial the Cheque Return Memo

RBI through Rule 6 of the Uniform Regulations and Rules for Bankers’ Clearing House(URRBCH) in case of Dishonour/Return of unpaid cheques provide for signed/initialed objection slip (Return memo) on which a definite and valid reason for refusing payment should be stated along with “The Date of Return” on the return memo. These are critical inputs of Return Memo in case of recourse to legal action. Dereliction in not adhering to RBI directive may invite penal action.

Intra-bank Deposit Accounts Portability

It has been noticed by Reserve Bank of India (RBI) that some banks are insisting on opening of fresh accounts by customers when customers approach them for transferring their account from one branch of the bank to another branch of the same bank. Such insistence on   opening of fresh account or making the customer undergo full KYC process again causes inconvenience to them resulting in poor customer service. It is not reasonable in view of the fact that branches are now on CBS and KYC records of a particular customer can be accessed by any branch of the bank. KYC   once   done   by   one   branch   of   the   bank   should   be   valid   for transfer of the account within the bank as long as full KYC has been done for the concerned account.

The customer should be allowed to transfer his account from one branch to another branch without restrictions.

In order to comply with KYC requirements of correct address of the person, fresh address proof may be obtained from him/her upon such transfer by the transferee branch. 

Deceased Claims Settlement Process

Features of Deceased Claims Settlement Process Related to Deposit Accounts

1.                Submit prescribed Application Form G-64 (Revised) indicating details of deceased person’s assets and liabilities and family declaration of the deceased (i.e. fill in details from Page-1 to Page-7 of G-64 (Revised) Application Form to the branch.

2.                An affidavit to be affirmed by the claimant(s), other legal heir(s) of the deceased to be executed on Non-judicial Stamp Paper of requisite value duly affirmed before a Metropolitan / 1st Class Magistrate or a Notary Public or any authority duly authorized to affirm or to take affidavit on oath as mentioned in Page-8 of G-64 Form.

3.                If there is nomination to the Deposit Account, particulars mentioned in Page-18 of G-64 (Revised Form) has to be filled up and submitted to the branch.

4.                If the Nominee desires for Settlement of Claims without production of relevant Passbooks / Deposit Certificate / Safe Custody Receipts and Locker Keys etc., than proforma of Indemnity has to be signed by the Nominee and the Indemnities as mentioned in Page-19 of G-64 (Revised) Form on a Stamp Paper of requisite value. This has to be submitted to the branch.

5.                If the Settlement of Deceased Claim amount is less than Rs.2 lac, then Proforma of Application / Indemnity for Settlement of Deceased Claim is mentioned in Page-21 of G-64 (Revised) Form. This has to be submitted to the branch.

6.                Settlement of claims in deceased depositor accounts will be only against indemnity furnished by legal heirs. No surety is required upto claim amount of Rs.50,000/-.

7.                Claim in accounts with Nomination Facility or Joint Account with operational mandates like E or S, there is no need to furnish indemnity irrespective of claim amount involved.

8.                If there is no nomination to the account, then proforma of Indemnity to be executed by claimants, legal heirs, sureties to be executed on non-judicial stamp paper of requisite value is mentioned in Page-12 of G-64 (Revised) Form. This has to be submitted to the branch.

9.                Produce attested copy of the death certificate issued by the appropriate authority (produce original death certificate for verification and the same will be returned after verification by the branch).

10.              Payment of Settlement of Claim will be made by Pay Order or Credit to account after due verification of records and the field level enquiries by the branch officials as per the extant guidelines of the bank.

11.              After submission of all required relevant documents, the time limit for Settlement of Claim is within 15 days from the date of final submission to the branch in case of accounts having nomination facility and 30 days in case of accounts which do not have nomination facility.

For any further details, please contact the Manager / Senior Manager/ Chief Manager at your nearest branch of UCO Bank.