IS IT BANK FAULT ? OR MINE ?

Firstly, signing any loan papers by the legal heirs is not necessary for the bank and the bank can always demand from the legl heirs provided they file recovery suit in the Court against the legal heirs, as it is peovided by law to bring the legal representative to the suit as a party and insuring the life of the barrower is not compulsory for the Financial institutions. Secondly, with holding pension of the mentally retarded child is an abuse of the power of the authorities for which you can file suit against such officer for release of the pension for the mentally retarded Child, as it is not only illegal but a violation of human rights as per Article 23 and 26 of the Convention on the Rights of the Child 1989 to which India is also a party to the Convention.Besides that unless there is a special laws enacted by your State Government under Section 60 of the CPC gratuities and family pension can not even be attached by the Court.

Legal heirs of deceased borrower are liable to the bank to the extent of property or assets inherited by them from the deceased. I think bank would have obtained undertaking from your mother's office that it will pay terminal benefits [gratuity etc] to bank towards loan in case of death of loanee.

As for insurance please make enquiries with the bank, since all loans are not necessarily covered by such insurance and rules vary from bank to bank. You can obtain statement of loan or savings accounts and find out if insurance premium is debited to her account.

The bankers can recover loans from heirs and at the same time since you have joined

your mothers office ask the bankers to recovery from salary by instalments.

Gratuity is exemptemed from attachment

You can file family pension papers of your sister as next friend duly attaching medical certificate

These are all the other types of the forums and are not related to the other types of the forums.

This has its owmn special place in the forum world.

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4.I heard that once the bank is giving personal loans they have to made the "INSURANCE" of the loan and to pay the loan amount. But no insurance has been made for the personal loans by the BANKS.

This statement of the querist is incorrect as Liability Insurance is not covered for personal loans.

Bank do use tactics to pressure and frighten the client to recover their debts and such tactics are exercised by phone calls or visits.

As a matter of fair practices code banks have to provide copies of all the forms and docs signed by their client.

You may search the records kept by your mother if the copies of the loan form signed by your mother is available .You can visit the concerned branch of the bank and ask for the copies of all forms signed and all docs collected from your mother.You can get it done amicably since you are being asked by the bank to pay.You can also collect the info from the concerned official in the office of your mother, which is now your office also, and find out if the office issued any document to the bank with the consent of your mother.

If you are not given these amicably, you may obtain thru RTI/ or by approaching the nodal officer of the bank/or thru RBI and you may write to the concerned authority of your office.Once you have the copies of all docs, you shall be clear.

If the bank has been forcing you thru letters you may demand all documents related to the loan in writing and consult a  lawyer to represent and defend you.

The learned experts have given valuable suggestions and have made the matter clear.

I agree with the opinion of Mr. J.P. Shah and Palukuru Satyanaryana. The Bank can recover the outstanding dues from the legal heirs upto the extent of their inheritance. You can ask teh Banks to recover their dues from your salary.

The amount of gratuty cannot be attached and also the pension cannot be withhold.

In case of personal to employees , Bank also takes the letter from the employer that the employer will deduct the amount from the salary and remit the same to the bank.this arrangement facilitate the bank to give loan. You check  with employer whether such undertaking was given by them to the bank. it is better to clear the dues so your dues  will be released to you at an early date. a legal heir who inherits the property of the deceased has to pay the debts of the deceased out of that property.