The Government Savings Banks Act, 1873

The Government Savings Banks Act, 1873 act was enacted on 28 January 1873 to amend the law with regard to Government Savings Bank, it extends to whole of India. But this Act does not apply to any deposits that is made in Anchal Savings Bank in State of Travancore Cochin. Any law in force in the said State relating to deposits shall continue to apply before commencement of Part B States (laws) Act 1951 as it is and considered it was not repealed. This Act extends to Union Territory of Goa, Diu, Daman, Pondicherry, Lakshadweep, Dadra, Nagar Haveli, Arunachal Pradesh under gazette notification dated 1 September 1962.

The terms like depositor, secretary, minor, prescribed are explained under Section 3 of the Act. Section4 of the Act states about the deceased person’s estates and deposits belonging to them. The nominee shall have the right over the deposit if the depositor dies and unless the nomination of such nominee is cancelled or varied in a prescribed manner. If the depositor is alive and the nominee or two or more nominees all predecease the depositor then such nomination becomes void. A minor can also be made a nominee under the said Act in a prescribed manner.

Section4A states about the deposit amount that shall be paid to the nominated person.  It can be 2 or more nominees also and if no nominee is stated then any legal heir can after producing succession certificate can apply for the amount. One exception here is that the term deposit cannot be paid before it has become due.  Payment thus done by banks shall be fully discharging itself from further liabilities with respect to such monies paid. One exception here is that any executor or other representatives of deceased person can recover the amount of debt that was lawfully owed to them in due course of administration and a creditor can also claim against the deceased’s estate. Secretary of any Bank for due administration if he thinks necessary can provide security to any person for whom such money has been paid. Section 7 states that as per the law, the Secretary of any bank can take evidence on oath for the purpose of ascertaining the right of person claiming to be entitled to such money. If a person gives false statement he/she shall be deemed to be guilty of an offence under Section 193 of IPC.

If the deceased depositor’s deposit does not exceed rupees 3,000 then it is excluded from fee chargeable under Court fees Act 1870 but the person claiming it should show to the court a certificate of amount of deposit and Secretary of Bank shall sign that certificate.  The Court shall accept it as an evidence on the said amount.

Section 10 of the Act states about the minor’s deposit that can be paid to him/her personally or to any of their guardian, if any other person has made the deposit other than the minor itself along with its interest and a receipt shall be given on it to minor or guardian for any money paid to them. Section 12 of the Act states about deposits relating to insane person.  If the Secretary of the Bank thinks that a depositor has become insane and is not capable of managing his affairs then Secretary may make such payments to any proper person and receipt to that person and it shall be a sufficient discharge under the act.  One exception here is that if a committee has been appointed on depositor’s estate then payment should be done only to such committee itself.

Section 13 explains that if a married woman or any woman who marries afterwards makes a deposit in the bank then such amount shall be paid to her along with the receipt for the money paid. Secretary cannot be sued under the act if he takes any action or does anything in good faith. Section 15 explains that Central Government can make rules for carrying on the said Act by notification in the Official Gazette.