New Delhi [India], January 2 (ANI): A plea was moved in the Delhi High Court seeking directions for a platform where individuals could view a comprehensive list of all their financial assets–active, inactive, dormant, or inoperative–held across entities regulated by relevant authorities.
The Division bench led by the acting Chief Justice has recently acknowledged that the petitioner has raised an important issue regarding the creation of a centralized portal for accessing financial assets post-e-KYC.
However, the court stated that it does not believe judicial intervention is necessary at this stage, leaving the matter to the concerned authorities for further consideration.
The Court noted that large amounts of money are lying in the bank accounts, which are unclaimed. Additionally, there are valuable securities that remain unclaimed. Court also noted that about 9,22,40,295 bank accounts have become inoperative and the average balance in the said accounts is 3,918/-. It is contended that the said amounts belong to persons from poor and low-middle-income groups and are lying unclaimed as information regarding the said accounts is not readily available.
It was also noted by the Court that in several cases, account holders have expired but their legal heirs may have no knowledge of the balance lying in the said accounts. In the aforesaid backdrop, the petitioner prays that a direction be issued to respondents nos.1 to 6 for issuing guidelines to its regulated entities
The plea moved by Social Activist Aakash Goel, sought directions for the respondents to issue guidelines mandating regulated entities to capture minimum details about nominee(s) for each financial asset.
The plea sought directions to the RBI, SEBI, IRDAI, National Savings Institute, and the Pension Fund Regulatory & Development Authority to create a centralized portal. This portal would allow individuals, upon completing e-KYC procedures, to access a comprehensive list of all their financial assets–whether active, inactive, dormant, or inoperative–held across entities regulated by these authorities.
The Petitioner alleged failure of respondents, including the Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), Insurance Regulatory and Development Authority of India (IRDAI), National Savings Institute, Employees’ Provident Fund Organization (EPFO), and the Pension Fund Regulatory & Development Authority (PFRDA), to mandatorily collect nominee details for each financial asset.
This failure has led to situations where account holders and their nominees are not informed if accounts become inoperative. The petition claims that this oversight has resulted in approximately Rs 3,50,000 crore in unclaimed and inoperative funds across all regulated entities. The petition argues that this failure violates citizens’ fundamental rights under Articles 14 and 21 of the Constitution of India, plea stated.
The petitioner also sought the court’s direction to ensure the rightful recovery and transparency of financial assets to the legitimate beneficiaries. In doing so, the petitioner emphasizes the importance of distinguishing between “inoperative” (or dormant) accounts and “unclaimed” accounts, as these terms carry significant implications regarding asset ownership and the rights to recovery.
The plea further stated that the respondents have a statutory duty to protect the interests of every contributor, including investors, depositors, policyholders, and others. However, the respondents have failed to fulfil this obligation, resulting in approximately Rs 3,50,000 crores being trapped in inoperative, unclaimed, or dormant funds. Additionally, an estimated Rs 10,07,662 crores is at risk of becoming inoperative or unclaimed shortly, as these amounts are reflected in bank accounts that lack nominee details.
The plea also highlighted three significant funds–DEAF (Depositor Education and Awareness Fund), IEPF (Investor Education and Protection Fund), and SCWF (Senior Citizens Welfare Fund)–which collectively represent substantial unclaimed funds.
Notably, the SCWF is accessible for public welfare under the escheat provision, as outlined in Section 126 of the Finance Act, 2015, ensuring its utilization for the benefit of citizens. However, no such provision exists for the DEAF and IEPF, revealing a glaring inconsistency.
Together, these two funds hold over Rs 1,60,000 crore, yet remain largely underutilized for public welfare. It is pointed out that Rs 1.60 lakh crore is nearly three times the country’s health budget and at least double the education budget. This discrepancy underscores the urgent need for a structured policy to unlock and leverage these idle resources for the betterment of society while addressing the broader issue of unclaimed funds, plea read (ANI)
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