loan to Karta on the FDR in the name of HUF

S.D. Singh (Querist) 24 June 2010 This query is : Resolved
Mr, X obtained housing loan in his personal name and against the loan offerred FDR in the name of M/S X HUF as security, but bank refused to accept the FDR being in the name of HUF on the ground that FDR of HUF can not be pledged against the housing loan in individual name as prohibited under Hindu law. Is it correct. If yes , please provide the relevant law / section / sct etc.

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adv. rajeev ( rajoo ) (Expert) 24 June 2010
FDR is of HUF so rightly it is not accepted by the manager.
It is the property of HUF every member of HUF is entittle for the share as such it is not accepted

Adv.Aiyer VLV (Expert) 25 June 2010
adv. rajeev is right

what is the use of keeping FDR as security for housing loan. housing property mortgage will be enough?

why not encash FDR and make fresh deposit, if it is meant for HUF purpose?

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