- Types of Bank Customers
- Personal accounts
- Hindu Undivided Family (HUF)
- Sole Proprietary Firms
- Partnership Firm
- Financial obligation Partnership (LLP)
- Clubs & Societies
During the opening of accounts, the banker deals with differing types of customer. The banker ought to acquaint himself with numerous laws governing differing types of customers. The customer is often classified as follows:
Banker ought to lookout and verify the sure reality whereas gap of accounts of individual. As per Indian Contract Act 1872, an individual is competent to enter into a sound contract and open a checking account provided:
• Individual ought to be major, i.e. of eighteen years of age;
• He ought to be sound mind;
• He is otherwise not disqualified by any law;
• He shouldn’t be associate insolvent;
• Drunken person isn’t wrongfully competent to enter into a contract;
• He ought to be in sagacity whereas disposal a loan and stepping into a contract.
Hindu Undivided Family (HUF):
Hindu Undivided Family’ otherwise called ‘Joint Hindu Family’ property, business or ancestral estates and its common possession, enjoyment possession is that the basis of formation of HUF. As per Hindu law, the Hindus, Sikhs & Jains will kind HUF. HUF property is managed by senior most major male member known as ‘Manager’ or ‘Karta’. Upon death of Karta, next senior male coparcener becomes Karta. Joint homeowners of HUF square measure called coparceners. It consists of 1 common living root and his all male & feminine descendent up to a few generations next to him. HUF cannot enter into a partnership as per Supreme Court judgement of 1998.
Sole Proprietary Firms
Business is completely closely-held by a personal. In law, there’s no distinction between man of affairs & the firm. altogether respects, it’s associate account within the name of a personal solely except that it’s operated upon by the man of affairs on behalf of firm. For gap associate account within the name of a sole proprietary firm, CDD of the individual (proprietor) shall be dole out. Additionally, to the higher than, any 2 of the subsequent documents as an indication of business/ activity within the name of the proprietary firm shall even be obtained:
- Registration certificate
- Certificate/licence issued by the municipal authorities below look and institution Act.
- Sales and taxation returns.
- CST/VAT/ GST certificate (provisional/final).
- Certificate/registration document issued by Sales Tax/Service Tax/Professional Tax authorities.
- IEC (Importer businessperson Code) issued to the proprietary concern by the workplace of DGFT or Licence/certificate of apply issued within the name of the proprietary concern by any skilled body incorporated below a statute.
- Complete taxation come back (not simply the acknowledgement) within the name of the only man of affairs wherever the firm’s financial gain is mirrored, punctually acknowledged by the taxation authorities.
- Utility bills like electricity, water, phone line, phone bills, etc.
Partnership is that the relation between persons United Nations agency have united to share profits of business carried on by all or anyone them acting for all (Indian Partnership Act 1932). A minor can’t be a partner; however, he is often admitted for his profit in associate existing partnership firm. The particulars of minor partner, significantly the DOB ought to be properly recorded. Dissolution of the Partnership firm will ensue by following ways:
1. By mutual consent;
2. Death/insolvency/retirement of a partner;
3. Operation of Law (insolvency of all partners, business changing into unlawful, dissolution by a competent court; and
4. just in case of automatic dissolution.
Financial obligation Partnership (LLP)
A financial obligation partnership (LLP) could be a partnership within which some or all partners (depending on the jurisdiction) have restricted liabilities. LLP is ruled by financial obligation partnership Act 2008. Liability is proscribed to the extent of his contribution within the LLP. Minimum two selected partner and no limit on most variety of Partners. A partner isn’t accountable for another partner’s misconduct or negligence, except in sure cases. LLP could be a legal entity break away its partner. Its own assets in his name, certain and be sued. Since LLP contains part of each ‘a company structure’ also as ‘a partnership firm structure’ LLP is named a hybrid between a corporation and a partnership.
Companies square measure outlined in Indian Company Act 1956. As per the supply of Company Act 2013 (implemented with result from first Gregorian calendar month 2014), acknowledges a joint Stock Company could be a legal person with perpetual entity & is distinct from its members. a corporation or association of persons are often created at law as legal person in order that the corporate in itself will settle for financial obligation for civil responsibility.
Trusts square measure ruled by the Indian Trust Act, 1882. A trust is formed once possession of a property is transferred to somebody for holding or managing it for good thing about another person(s). Trust could also be public trust or personal trust (for good thing about personal individuals). Trusts managed by trustees. Loan are often granted if it’s for the aim of the trust. Trustee is authorised to borrow as per the legal document. Original legal document to be examined before funding. Certificate of Registration below trust Act to be examined & copy to be unbroken on record.
Clubs & Societies
Clubs & Societies square measure non-profit creating organisation and represent a gaggle of persons. These square measures commonly incorporated below Cooperative Society Act. Clubs are often registered below Society Act 1860, or Company Act 1956. These get the standing of a legal entity solely when their incorporation in their own name. These square measures ruled by rules & rules (bye laws). Certified true copy of resolution. Cheques favouring society, club, association to not be collected in individual accounts of workplace bearers or workers.