Sir,
My mother and I have fixed deposits with the Nationalised Banks. My mother is the first holder and I second, E or S. The deposit matures in july, 2017. My mother passed away in August, 2016.
The Banks say that it is not possible to delete the name of the deceased from the FDR. The system does not accept such chnages is their standard reply. They say that they will just make a remark in the FDR that the first named has expired. They say that you can encash it on maturity.
Assuming that I just accept the hand-written endorsement ( but no change in their computer records ), the Banks will deduct tax at source in the first week of April, 2017 because my mother is not alive to give Form no. 15H. She was a senior citizen , aged 97, when she died. Since her income is below Rs 5 lcs per annum, no return of income tax was filed these years, but she has a PAN number.
My queries are :
1. Whether it is legal on the part of the Banks to refuse to delete the first holder's name ( who is deceased ) in the FDR ? What does the Banking laws say in this regard ?
2. How to avoid TDS on my mother's interest income accrued to her since the date of the demise. Can the IT dept. issue a letter to the Banks not to deduct TDS ?
Thanking you sir,
N.R.Ranganathan.
nrpatanjali @ yahoo.com
CAclubindia
