J&K&L High Court Holds Payment to ‘Either/Survivor’ Joint Account Holder Fully Discharges Bank’s Liability

The J&K&L High Court has held that when a joint account carries the “either or survivor” mandate, a bank is fully discharged of liability once it releases the matured amount to the surviving account holder.

Any dispute over entitlement lies between the survivor and the legal heirs and not the bank.

Justice Sanjay Dhar quashed criminal proceedings against HSBC and a co-accused, noting that RBI guidelines clearly permit such payments and that allegations against them were vague.

The Court added that civil succession disputes cannot be converted into criminal liability for banks acting under valid survivorship instructions, calling the complaint an abuse of process.

[Shabeena Ibrahim The Hongkong & Shanghai Banking Corporation Limit v. Mir Usman Disooki]