Unexpected gains for Mahila Bank depositors

As the liquidation proceedings for Nagpur Mahila Urban Cooperative Bank are set to begin, many harried depositors may get an unexpected gain

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when the crisis finally ends. In what may come as a surprise for many, the claims paid under the deposit insurance and credit guarantee corporation (DICGC) scheme include the interest accrued on the deposits too. So, the principal amount along with the interest up to Rs 1 lakh total shall be returned by the way of insurance. The DICGC covers all deposits to an upper limit of Rs 1 lakh.

As per the rules, if a depositor had left Rs 90,000 when the bank faced a restriction on withdrawals, and an interest of Rs 10,000 accrued in the meantime, the person would get Rs 1 lakh in all, said liquidator JK Thakur, who took charge on Thursday. The bank offered rates as high as 10-12%, so there are chances that many depositors shall get substantially higher amounts than what they had invested. Many of them had only hoped to get the principal back, and had given up hope about the interest. The amount paid on hardship grounds will be deducted from the payable sum.

Thakur said his first priority will be to settle the claims under the DICGC scheme. Out of 61,000 depositors in all, 59,500 have a claim within Rs 1 lakh. The bank's total deposits stand at around Rs 71 crore. It would take around 2-3 months to submit the claim after calculating the interest till the date the bank's licence was cancelled on August 30, 2009. The interest up to June 30, 2009, has already been calculated. There are certain agencies offering services in this sector, which may be hired for faster processing, said Thakur.

As far as the remaining amount is concerned it would be recovered by selling assets and recovering money from borrowers, Thakur said.


The fine print of deposit insurance

NAGPUR: If a single individual has different deposit accounts in his name, then all such funds held in the same type of ownership in the bank are added together while determining the insurance claim. This means that if an individual has three deposit accounts having Rs 1 lakh in each, then only Rs 1 lakh will be compensated.

However, if the funds are held in different types of ownership, or are deposited into separate banks, they would then be separately insured. For example if a depositor `Pandit' also opens other deposit account in his capacity as a partner of a firm, guardian of a minor, director of a company, trustee of a trust, or a joint account with his wife in one or more branches of the bank, then such accounts are considered as held in different capacity and different right. Accordingly, such deposits accounts will also enjoy the insurance cover up to Rs 1 lakh separately, says the section of frequently asked questions (FAQs) on the DICGC website.

If more than one deposit accounts (savings, current, recurring or fixed deposit) are jointly held by individuals in a bank, where their names appear in the same order, then all these accounts are considered as held in the same capacity and in the same right. Then again, all these accounts will be aggregated as one, and a limit of Rs 1 lakh will apply.

However, if individuals open more than one joint accounts, in which their names are not in the same order, then there is a separate compensation for each account. There is a separate insurance if the group of persons in joint accounts are different too. At the same time the bank can also adjust its dues payable by the depositors before paying the insurance amount, says the website.

Liberhan commission report a 'political document': Uma Bharti

Terming the Liberhan commission report as a "political document", the Bharatiya Jan Shakti national president Uma Bharti on Tuesday appealed to BJP leader LK Advani to steer the country and political parties in resolving the protracted Ajodhya dispute instead of keeping the issue frozen. She however refrained from making any comment on whether she intended to return to her parent political organisation.

Bharti, indicted by the commission in its report, said she will support Advani in any effort that seeks a permanent solution to the issue and paves way for the construction of Ram Mandir at the disputed site in the best interest of the country.

"This issue needs to be resolved immediately for the country to come back to main political agenda." She said she would also meet the Vishwa Hindu Parishad (VHP) leader Ashok Singhal on Wednesday and appeal to him to make efforts for an early resolution.

Talking to reporters at Nagpur on her way to Bhopal from Wardha, Uma Bharti said the responsibility of the report's leak should be fixed at the earliest and the guilty punished.

"This is the right time to resolve this frozen issue," Bharti said. "I wish the political game on an issue of deep importance to the Hindus of this country be stopped."

Political parties should convince the Muslim community to allow the construction of a Ram Mandir, she said. "Ayodhya is to the Hindus, " she said, "what Mecca is to the Muslims." The site, she said, is not of any big religious importance to Muslims.

The former BJP leader who was among the leaders to spearhead the Kar-Seva that led to the demolition of the Babri Masjid owned a full moral responsibility for what happened in Ayodhya on December 6, 1992.

"It was on my call that people had congregated," she said. But the structure, she said, would have remained in tact had the administration given thousands of volunteers permission to do Kar Seva.

Bharti said, "an undue delay in judicial verdict on who the custodian of the disputed land is (which is yet awaited), an insensitive bureaucracy and minority politics contributed to the Babri Masjid demolition."

Reflecting on the sequence of events that led to the demolition of the mosque, she said the then prime minister PV Narasimha Rao did well in not sending the paramilitary troops immediately to the site. "Thousands of people would have died had he sent the troops and had there been a firing," she said.

"I salute Rao that he sent the troops only when the Kar Sevaks had dispersed from the demolished site." Condemning the commission for wasting crores of rupees of the public exchequer in giving a mere "general assessment", Bharti said this report could have been readied within a month of the demolition. "It is more of a gospel."