Encashing father's signed cheques after his death
Ajay
(Querist) 02 June 2020
This query is : Resolved
Hello Sir,
My father passed away 23-May'20 and he left behind signed 3 cheques (without date and amounts) for us to withdraw the total cumulative money from his ongoing pension till his death. Due to the family grief and current lockdown I could not present those cheques to the SBI bank immediately after his death and now its nearly 10 days, I am not sure if I can still withdraw (a) via those cheques, (b) the full currently available balance, (c) including the past month's pension, via those cheques into our 3 accounts i. e. my mother's, my sister's and my own account. His death is not yet registered. He is clear from all debts and has no others liabilities, except for pension tax for April and May for which I intend to leave a certain amount behind in his account. Please can you advice what should I do. Thanks
Dr J C Vashista
(Expert) 03 June 2020
The cheques are valid for 3 months, present them (cheques) for realisation immediately it shall be honoured..
P. Venu
(Expert) 03 June 2020
The Bank may honour the cheque if they have no notice of the death. However, it is a question morality than that of law.
Hemant Agarwal
(Expert) 03 June 2020
1. It is perfectly legal to deposit late Father's cheques and it will not constitute any prosecutable offence PROVIDED the legal beneficiaries do not dispute the same.
2. Close the Bank account by following due procedures and as a legal heir you may prefer to pay any taxation for your father's liabilities, AFTER consulting with a CA.
Keep Smiling .... Hemant Agarwal
VISIT: www.chshelpforum.com
Ajay
(Querist) 03 June 2020
thank you sirs. does it matter what date i put on the cheques, i. e. before his death or any date after his death. Regards,
Raj Kumar Makkad
(Expert) 03 June 2020
Legally I have also the similar opinion as expressed above but it shall be morally good if you take into confidence other members of your family so that no bad impression in the family occur due to your action.
Rajendra K Goyal
(Expert) 03 June 2020
After the death of an account holder the proceeds belong to all his legal heirs / proceeds to be inherited as per his will if any.
The operation of the account should be stopped immediately after information of the death of the account holder and if any cheque signed by the deceased is presented, Bank would return the same with the objection of the death of the account holder with the instruction to contact the legal heirs.
Statutory payments can be withdrawn from the account.
any payment knowingly withdrawn may put the person in trouble.
Rajendra K Goyal
(Expert) 03 June 2020
As the account holder had died on 23.05.2020, his pension for the month of May would be credited at the end of month. Pension on 8 days has to be returned to the concerned department.
Inform the Bank to deduct the said 8 days pension and remit back to concerned department.
Rajendra K Goyal
(Expert) 03 June 2020
The procedure to be followed by the legal heirs is as under (may refer RBI / SBI guidelines for details):
Obtain legal heir certificate from competent authority / affidavit on prescribed language of the Bank (SBI) from person having worth more than the amount involved, known to the Bank.
All legal heirs should apply for payment of full outstanding in the account.
Indemnity Bond based on prescribed language of the Bank (SBI) by a person having worth more than the amount involved, known to the Bank and from the claimants jointly.
If all the legal heirs are unable to present letter of renounce their share in favor of any one legal heir.
Id proofs of all the claimants / person giving affidavit / person giving indemnity is to be attached.
Rajendra K Goyal
(Expert) 03 June 2020
The claim from Bank should be lodged after any statutory dues has been paid / credited in case of refund.
The income tax return if applicable has to be filed for the previous and current year by the legal heir.
If family pension is applicable, application for the same should be submitted.
Raj Kumar Makkad
(Expert) 03 June 2020
If the date on the cheques is prior to the death of the account-holder then the same can definitely be deposited and encahsed by you as those have already been issued to you.
Rajendra K Goyal
(Expert) 04 June 2020
Bank is not obliged to honor the cheques except government dues which were signed by the deceased presented after the death.
After the death of an account holder, balance in account belong to legal heirs.
In this case the deceased has not issued the cheques, heirs want to adopt shortcut.
It is better to complete the formalities and get the payment.
Raj Kumar Makkad
(Expert) 04 June 2020
No foul game should be played wherein the rights of the other siblings of the author are affected. Once payment is obtained from the bank then also a claim before other siblings can be raised against the said cheques which could not be got deposited prior to the death of your deceased father.
Rajendra K Goyal
(Expert) 05 June 2020
In case any payment is received by any of the heirs on the basis of signed cheques left after demise of the account holder, the heirs effected adversely may sue the Bank for undue favor and unauthorizedly disposing the assets of the deceased.
Banks generally play safe to avoid such situation / disputes and return the cheques presented with the remark, account holder reported expired, contact legal heirs.
In the present case, the proceeds include the extra paid pension to the deceased, which has to be recovered from the account.
