Hi, my father was having a HUF account with a co-operative bank, he expired few months back, being karta he has opened few Fixed Deposits on name of HUF in the bank. On death of karta, bank has allowed me as karta of the HUF being eldest male member. But they also have asked us to premature liquidation of all FDs opened by him. Please guide in such case, is there any law where bank can ask us to liquidate?
There are two options. One is to liquidate it or continue till maturity. But banks can’t force you to liquidate it. It is purely left with you. However, informing to bank about the death of depositor is BEST. Read the RBI reference for the same (even though it is not meant for HUF, I strongly admit that the rules applies to HUF FDs too).