Explain the following statements by giving brief reasons in the context of provisions contained under Banking Regulation Act and the prevelant banking practice by referring the provisions of Negotiable Instrument Act? (i

CS Professional · Banking - Law and Practice · PYQS · June 2018
Explain the following statements by giving brief reasons in the context of provisions contained under Banking Regulation Act and the prevelant banking practice by referring the provisions of Negotiable Instrument Act? (ii) Even though a contract with a minor is void, the bank opens a savings bank account in the name of a minor.

Answer & Explanation:

To enable minors to get their 'Necessaries' in life as well as to encourage thrift in them; the ceiling on the deposits is comparatively low. The Bank takes a calculated commercial decision. Withdrawal is restricted to the minor only against his receipt and hence receipt of the moneys cannot be denied by him.

Topics: Banking Law and Practice

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