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20+ Practice MCQs

On Nomination Facility
by Banks
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NOMINATION FACILITY PROVIDED BY BANKS MCQS WITH CASE STUDY Free E-Book

Nomination Facility Provided by Banks MCQs with Case Study

1. Nomination facilities were extended to customers of the banks after legislation was
passed making amendments in.
Option A. Banking Regulation Act, 1949.
Option B. Reserve Bank of India Act, 1934.
Option C. Banking Companies (Acquisition and Transfer of Undertakings), Act, 1970.
Option D. all above.
The correct answer is Option A. Banking Regulation Act, 1949.

2. Nomination facilities are available.

Option A. in deposit accounts.
Option B. on safe deposit lockers.
Option C. on articles deposited for safe custody.
Option D. in all above.
The correct answer is Option D. in all above.

3. Nomination facilities relating to deposit accounts are available in.

Option A. individual accounts in single name.
Option B. individual accounts in joint names.
Option C. sole proprietorship accounts.
Option D. all above.
The correct answer is Option D. all above.

4. Nomination facility is not available in.

Option A. account in the name of a club or a society.
Option B. account in the name of partnership firm.
Option C. account in the name of trust.
Option D. all above.
The correct answer is Option D. all above.

5. Nomination facility is not available in.

Option A. lockers in joint names.
Option B. articles accepted for safe custody from more than one person.
Option C. deposit account in joint names.
Option D. none of the above.
The correct answer is Option B. articles accepted for safe custody from more than one
person.

6. In case of deposit account in more than one name the number of nominees can be -
Option A. one.
Option B. two.
Option C. three.
Option D. not more than number of account holders.
The correct answer is Option A. one.
NOMINATION FACILITY PROVIDED BY BANKS MCQS WITH CASE STUDY Free E-Book

7. A depositor has appointed his minor son aged 12 years as nominee. He will be
required-
Option A. to appoint a major as second nominee.
Option B. to appoint some major person as his nominee in place of minor.
Option C. not to exercise any nomination at all.
Option D. to appoint a major person to receive payment on behalf of minor nominee in the
event of death of depositor.
The correct answer is Option D. to appoint a major person to receive payment on behalf
of minor nominee in the event od death of depositor.

8. A minor above the age of 15 years opened his individual savings account in his single
name. in this account nomination facility is:
Option A. not available as a minor cannot appoint an agent.
Option B. available as minor has completed 14 years of age.
Option C. available only if his father indemnifies the bank.
Option D. either Option A. or Option C. above.
The correct answer is Option A. not available as a minor cannot appoint an agent.

9. A literate depositor has exercised nomination in favour of his cousin. This

nomination requires.
Option A. no objection certificate from his legal heirs.
Option B. attestation by notary public.
Option C. attestation by two witnesses.
Option D. none of the above.
The correct answer is Option D. none of the above.

10. A deposit was accepted with instructions ‘either or survivor ‘from two depositors A
and B. A died before due date. B approaches the bank to cancel nomination earlier
exercised by them. In this case:
Option A. nomination once exercised is irrevocable.
Option B. it can be allowed as survivor can cancel, change or even exercise fresh nomination.
Option C. nomination can ‘t be cancelled as it requires consent of both the depositors.
Option D. either Option A. or Option C. above.
The correct answer is Option B. it can be allowed as survivor can cancel, change or even
exercise fresh nomination.

11. In the event of death of depositor who exercised nomination, the bank gets valid
discharge by payment:
Option A. to the nominee.
Option B. to nominee and legal heirs jointly.
Option C. to legal heirs only.
Option D. to court of law.
The correct answer is Option A. to the nominee.
NOMINATION FACILITY PROVIDED BY BANKS MCQS WITH CASE STUDY Free E-Book

12. Bank will get valid discharge on payment of balance in deposit account of depositor
who has expired provided:
Option A. there is no objection on behalf of legal heirs of the deceased.
Option B. bank has made it clear to nominee that he is getting the payment as trustee of legal
heirs of the deceased.
Option C. there are no legal heirs of the depositor.
Option D. either Option A. or Option B. above.
The correct answer is Option B. bank has made it clear to nominee that he is getting
the payment as trustee of legal heirs of the deceased.

13. In a deposit account in the name of two persons, either of them can singly:
Option A. change the existing nomination.
Option B. exercise fresh nomination.
Option C. cancel existing nomination.
Option D. none of the above.
The correct answer is Option D. none of the above.

14. A locker is let out to one person. He can appoint.

Option A. one nominee only.
Option B. any number of nominees.
Option C. two or three nominees.
Option D. no nominee can be appointed as nomination is allowed only in deposit accounts.
The correct answer is Option A. one nominee only.

15. A locker is let out to two persons with instructions ‘either or survivor. In this case.
Option A. there can be no nomination as nomination is allowed in deposit accounts only.
Option B. there can be 2 or 3 nominees.
Option C. there can be only one nominee.
Option D. nomination cannot be allowed as per instructions.
The correct answer is Option C. there can be only one nominee.

16. A locker is let out to three persons with operating instructions ‘any two of us jointly’
Option A. nomination is not allowed as it is not a deposit account.
Option B. nomination is not permitted in a jointly operated locker account.
Option C. there can be only one nominee.
Option D. there can be more than one but not more than two nominees.
The correct answer is Option D. there can be more than one but not more than two
nominees.

17. An illiterate depositor exercises nomination, it is required to be.

Option A. witnessed by two persons.
Option B. attested by a Gazetted officer of central or State Government.
Option C. brought to the notice of his legal heirs.
Option D. verified by the Notary Public.
The correct answer is Option A. witnessed by two persons.
NOMINATION FACILITY PROVIDED BY BANKS MCQS WITH CASE STUDY Free E-Book

18. We normally do not obtain the signatures of the nominee. In the event of the death
of the depositor, we get the identification of the nominee through-
Option A. two persons acceptable to the Bank.
Option B. any Gazetted Officer of Central government or State Government.
Option C. First Class Magistrate.
Option D. any one of the above.
The correct answer is Option D. any one of the above.

19. As per current guidelines of RBI where nomination has not been exercised, the
bank can make payment to legal heirs of the deceased depositor without insisting on
production of succession certificate upto:
Option A. Rs. 50,000.
Option B. Rs. 5 lakh.
Option C. Rs. 1 lakh.
Option D. any amount.
The correct answer is Option D. any amount.

20. As per current guidelines of RBI besides not insisting on succession certificate for
payment of deposit amount on being otherwise satisfied, the banks have been advised
to release goods/securities, etc. Forming security for an advance to heirs of the
deceased borrower without insisting on production of succession certificate upto value
of.
Option A. Rs. 1 lakh.
Option B. Rs. 50,000.
Option C. Rs. 5 lakh.
Option D. any amount.
The correct answer is Option D. any amount.

21. Your branch paid a sum of Rs. 627, 212 along with up to date interest to the
nominee of a depositor after proper identification and after observing usual
formalities on 10. 10. 2014 and on 25. 11. 2014 you receive a notice from the legal
heirs of the deceased depositors the payment has been wrongly made and that the
nominee being a distant relation of the deceased was not entitled to the
amount. Under the circumstances:
Option A. the bank is fully discharged in respect of its liability for the deposit though the claim
of legal heirs against the nominee may be legally valid.
Option B. the bank is discharged in full after making payment to the nominee and claim of
legal heirs against the nominee is not valid.
Option C. the bank should write to the nominee for refund and payment to the legal heirs.
Option D. the bank should have obtained no objection certificate from the legal heirs before
effecting payment to the nominee.
The correct answer is Option A. the bank is fully discharged in respect of its liability for
the deposit though the claim of legal heirs against the nominee may be legally valid.
NOMINATION FACILITY PROVIDED BY BANKS MCQS WITH CASE STUDY Free E-Book

22. A had deposited certain articles for safe custody with your branch and had
appointed B as his nominee. A died and B approaches you for return of the
articles. The bank should.
Option A. obtain claim form from ‘B ‘and return the articles to him and obtain receipt.
Option B. obtain claim form, prepare an inventory of the said articles which should be signed
by the nominee and give him one copy along with the articles.
Option C. ask him to come along with legal heirs of the deceased and deliver articles on
getting their joint discharge.
Option D. release the articles after only properly identifying B and without insisting on claim
form and without preparing any inventory.
The correct answer is Option B. obtain claim form, prepare an inventory of the said
articles which should be signed by the nominee and give him one copy along with the
articles.

23. While allowing access to a nominee of locker holder, and preparing inventory we
find among other things a sealed packet. We should:
Option A. tear it open and specifically mention the article It contained in the inventory.
Option B. mention it as sealed packet in the inventory and deliver it along with other things
after observing usual formalities.
Option C. allow delivery of all other loose articles but keep the sealed packet which should
be delivered in the presence of two independent witnesses.
Option D. either Option A. or Option C.
The correct answer is Option B. mention it as sealed packet in the inventory and deliver
it along with other things after observing usual formalities.

24. Your branch, after observing usual formalities, delivered articles in a locker to the
nominee of the locker holder. You receive a legal notice from the heirs of the locker
holder challenging the delivery of articles to the nominee. In this case:
Option A. bank should have ensured to deliver articles jointly to nominee and all legal heirs
and is hence liable.
Option B. on removal of contents of locker by the nominee, the liability of the bank in relation
to contents of the locker stands discharged provided bank had made it clear to the nominee
that he is receiving the articles as trustee of legal heirs of the deceased.
Option C. bank should advise the legal heirs to a file a suit against the nominee.
Option D. bank should seek legal opinion immediately.
The correct answer is Option B. on removal of contents of locker by the nominee, the
liability of the bank in relation to contents of the locker stands discharged provided
bank had made it clear to the nominee that he is receiving the articles as trustee of
legal heirs of the deceased.
NOMINATION FACILITY PROVIDED BY BANKS MCQS WITH CASE STUDY Free E-Book

25. Legal heirs of G, a locker holder of your branch, who had nominated H as his
nominee, have threatened to file a suit for damages against the bank for allowing to
the locker and liberty to remove articles to H. In this case.
Option A. no suit, prosecution or other legal proceeding shall lie against the bank.
Option B. bank is liable and should try for a compromise.
Option C. bank should request for some time to enable to it approach the nominee and
retrieve articles as per inventory prepared at the time of delivery.
Option D. either Option B. or Option C.

The correct answer is Option A. no suit, prosecution or other legal proceeding shall lie
against the bank.
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