Month: February 2025
Supreme Court rules that Banks fully liable for fraudulent withdrawals
In a landmark verdict, the Supreme Court has ruled that banks are fully liable if money is fraudulently
withdrawn from a customer’s account. The decision, delivered on 3rd January 2025 in the case of State Bank of India vs. Pallabh Bhowmik and Others, reinforces the accountability of financial institutions in safeguarding customer funds.
Banking expert Vidyadhar Anaskar emphasized that the ruling provides significant relief to account holders, affirming that banks cannot evade responsibility in cases of fraud. The verdict is expected to have a profound impact on banking operations and consumer protectionin the financial sector.
The court based its decision on Section 5 of the Banking Regulation Act, Section 10 of the Reserve Bank of India Act, and the Consumer Protection Act of 2019. The ruling mandates that banks must fully compensate customers for fraudulent withdrawals and ensure strict security measures to prevent such incidents.
During the hearing, the account holder argued that the bank had failed to fulfill its obligations by not implementing adequate fraud prevention measures. It was also alleged that the bank violated the Consumer Protection Act by neglecting its duty to protect customer funds. In response, the bank contended that it bore no negligence and that the customer’s failure to act promptly had contributed to the fraud.
However, the Supreme Court firmly held that the safety of customer deposits is not just a courtesy but a fundamental responsibility of banks. The judgment stressed that financial institutions must establish robust security systems to prevent fraud and cannot shift the burden onto customers under any circumstances.
This decision sets a critical precedent for the banking industry, reinforcing consumer rights and highlighting the necessity for stringent cybersecurity measures. Anaskar noted that this ruling will enhance public trust in banks and encourage financial institutions to adopt more effective fraud prevention mechanisms.
With this verdict, banks are expected to implement immediate and comprehensive security upgrades to protect customer accounts, ensuring better compliance with consumer protection laws and regulatory requirements.
How to delete yourself from the Internet
Can you erase yourself from the internet? We all know it’s possible to wipe our browser history
or deactivate a social media account, but how far can you go? This guide will take you through
all the necessary steps to erase your online presence.
Table of Contents
Why delete yourself from the internet?
How to remove personal information from the internet
Delete social media and online shopping accounts
Delete your social media accounts
Delete accounts for online shopping, dating, and other services
Remove your information directly from websites
Close websites you own
Scrub yourself from forums
Use search engines
Opt-out of data brokers
Remove unwanted search results
Deactivate your email accounts
How to avoid data collection in the future
Click Here for the full article – https://nordvpn.com/blog/delete-yourself-from-the-internet/?utm_source=Education&utm_medium=email&utm_Campaign=DeleteYourself
THE ROLE OF A NOMINEE IN CO-OPERATIVE HOUSING SOCIETIES:
A CASE STUDY OF Karan Vishnu Khandelwal vs. Chairman/Secretary, Vaikunth CHS Ltd.
The legal intricacies surrounding ownership and membership rights in cooperative housing
societies often lead to disputes, especially after the demise of a property owner. The case of Karan Vishnu Khandelwal vs. Chairman/Secretary, Vaikunth CHS Ltd., decided by the Bombay High Court on November 9, 2022, offers valuable insights into these issues.
Case Background
The dispute arose after the passing of Mr. Mannalal Suraimal Khandelwal, a member of Vaikunth Co-operative Housing Society in Andheri, Mumbai. Before his demise, Mr. Khandelwal had nominated his grandson, Karan Vishnu Khandelwal, as the nominee for his flat. After Mr. Khandelwalis death, the society
transferred the flaffs shares to Karan as per the nomination.
However, the nomination led to a legal battle between Karan and other legal heirs of Mr. Khandelwal, who contested the ownership of the property. The core issue revolved around whether the nominee could claim absolute ownership or whether the property should be divided among all legal heirs.
Key Legal Principles
The Bombay High Court referred to well-established legal principles to resolve the case.
It reiterated that:
- Nominee as a Trustee, Not an Owner: A nominee in a cooperative housing society does not become the absolute owner of the property upon the original member’s death. Instead, the nominee acts as a trustee, holding the property for the benefit of all legal heirs. This principle aligns with the Supreme Court’s landmark ruling in Indrani Wahi vs. Registrar of Cooperative Societies, which clarified that nomination only facilitates the transfer of shares but does not confer ownership. Ownership rights are governed by succession laws.
- Provisional Membership: The Maharashtra Cooperative Societies (Amendment) Act, 2019, introduced the concept of provisional membership. Upon a member’s death, the nominee is admitted as a provisional member, ensuring the society’s smooth functioning. However, the nominee’s status remains temporary until legal heirs establish their ownership through documents such as a succession certificate or legal heir certificate.
- Society’s Role: Cooperative societies are bound to transfer the shares to the nominee, as mandated by law. However, the society’s responsibility ends there, and it is not authorized to adiudicate ownership disputes among legal heirs.
Court’s Verdict
In its ruling, the Bombay High Court directed the society to admit Karan as a provisional member. At the same time, it advised the contesting heirs to obtain the necessary legal documents to assert their claims. The court emphasized that disputes over ownership should be resolved in civil courts based on succession laws, not by the co-operative society.
Implications for Housing Societies and Members
This case underscores the importance of understanding the distinction between nominee and a legal heir in cooperative housing societies. For members, it highlights the need to create a clear will to avoid disputes among heirs. For societies, it reaffirms their role as facilitators in transferring shares, without delving into ownership disputes.
Conclusion
The Karan Vishnu Khandelwal case clarifies a critical legal aspect of cooperative housing societies: nomination ensures continuity of management but does not determine ownership. Legal heirs must rely on succession laws to assert their rights. This judgment strikes a balance between the administrative requirements of societies and the rightful claims of heirs, serving as a guiding light for
similar disputes in the future.
MSWA’s Housing Society Review – January 2025
Recent Changes in Nomination Rules
There have been recent changes to nomination rules for bank accounts, mutual funds, and demat accounts.
Bank accounts
- The Banking Laws Amendment Act, 2024 allows up to four nominees to be named for a bank account.
- The nomination can be made for deposits, safe custody, and safety lockers.
- The nomination must specify the percentage of the deposit allocated to each nominee.
- If the order of nomination is not specified, the nominees will be considered in the order of their names.
Mutual funds and demat accounts
- The Securities and Exchange Board of India (SEBI) allows up to 10 nominees to be named for a mutual fund or demat account.
- The nomination must be made directly by the investor.
- The nominees can hold the assets jointly or open separate accounts.
- The investor must provide detailed information about their nominees, including their PAN number, driving license number, or Aadhaar number.
These changes aim to improve services for depositors, nominees, and investors. They also help to reduce unclaimed assets and improve the management of investments.
Consumer Resources 