A Mandate is an authority given by the account holder in favour of a third person to do certain acts on his behalf. This is issued by the account holder to his bank. Mandate is an official order or commission to do something.

Salient Features

It is unstamped letter signed by the customer. The signature of the person so authorized should be appended in the letter of mandate. It is for short and temporary period. In case of joint account holders – all the partner must signed the mandate. Power of Attorney is a stamped Document.

How and Why NRIs can Appoint Mandate Holder in NRE accounts.png
Mandate Holder

There are two types of Power of Attorney

1) Special Power of Attorney – It is for a single transaction
2) General Power of Attorney – empowers an agent to act in more than one transaction.

Power of attorney is a stamped document and generally executed in the presence of Notary Public/ Magistrate of a Court of government officials. The bank should obtain the original power of attorney for perusal and copy of the same is retained for record purposes.

The power of attorney holder must sign as Per Pro-
Attachment Orders

  • Those issued by the court, called Garnishee orders and
  • Those issued by Revenue Authorities.

Garnishee Orders
They are issued by a court in favor of judgment of creditors. A garnishee order is issued by two stages :

  • Order Nisi – Freeze or stop all the txns in the debtor account.
  • Order absolute

Joint Accounts – If the order is issued for the attachment of A’s deposits, the deposits held jointly by A and B cannot be attached, if the account is operated by either or survivor. But if it is former or survivor (and A is the former) and money belongs to clearly to the former alone, then it can be attached even if the attachment order mentions only the ‘A’ s name only.

Liquidator – If the company is in liquidation, the accounts of the liquidator cannot be attached by a fresh garnishee order because money held by the bank was not debts due to the company, but to the liquidator.

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