BANKING LAWS INCLUDING NI,BR & RBI ACT AND PRACTICES
1. Provisions relating to Nomination are given in : Banking Regulation Act (Sec 45 ZA to 45 ZF)
2. As per section 26 of the Negotiable Instruments Act, a Minor can draw, endorse, accept a negotiable
instrument but he can not : bind himself
3. A has granted Irrevocable Power of Attorney in favour of B for one year. After 3 months, A
revokes the Power of Attorney. A cheque signed by B is presented for payment_ What will you do?
The cheque will not be paid because POA can be withdrawn before maturity and once it is revoked,
no cheque signed by agent can be debited to account of Principal
4. What is the Doctrine of Ultra Vires in the context of a limited company?: Any act by the directors
beyond the object of the company is considered ultra vires the company and company is not bound by such
act.
5. A minor who was admitted to the benefits of partnership has become major. Within how much period,
he has to decide to remain partner in the firm or not?: within 6 months of attaining majority or 6 months of
knowing that he is the partner in the firm whichever is later.
6. If on a cheque words "Account Payee" is written between two parallel lines or with the name of a
bank, then: the cheque can not be endorsed.
7. Which type of crossing is required to be done if the drawer wants that in case of endorsement, the
title of transferee of the cheque should not be better than the title of the transferor: Not Negotiable Crossing
8. In the case of dishonour of a cheque due to insufficient funds, for enforcing rights under section 138
of the Negotiable Instruments Act 1881, the holder should send a notice to the drawer within: 30 days from
the date of receipt of notice regarding dishonour of the instrument.
9. The iimitation period for filing case in case of dishonour of cheque due to insufficient funds is: 1 month
from the date of cause of action.
10. Objectives for which a company has been formed are given in: Memorandum of Association
Full formof BCBS is Basel Committee on Banking Supervision.
11. Direct Impact of increase in CRR is : Controlling Liquidity
12. Banks can not issue Demand Draft payable to Bearer as per provisions of : Section 31 of the RBI Act
13. Grace Period is allowed in the case of : Usance Bills and Usance Promissory Notes
14. Indian Banks are required to maintain minimum Capital Adequacy Ratio of : 9%
15. In the case of individuals and HUF, tax will be deducted at source if the interest on term deposit in a
financial year is : more than Rs 10,000
16. If Power of Attorney is executed outside India it should be stamped within:90 days of its first arrival in India
17. For its implementation, the complainant should accept the award given by Ombudsman within: 30
days of the receipt of the copy of the award.
18. When proceeds of cheque are given before clearance of the cheque the banker will be called: Holder
for Value
19. What do we 'mean by Surrender Value of Life Insurance Policy?: Minimum amount payable by the
insurance company in case of foreclosure of the policy before maturity.
20. In the case ofWrongful dishonour of cheque, to whomthe bank is liable?: Drawer
21. If date on a cheque is prior to the date of its presentation, it is called: Ante Dated cheque
22. What isminor's liability in HUF Account: Minor is not liable
23. When does the right of nominee starts in respect of a deposit account?: After death of all depositors
24. For injectingmoney in themarket which type of transaction is undertaken?: (a) Repo (b) Reverse Repo
25. Garnishee order is not applicable to: Unutilised portion of the Cash credit limit
26. Which of the following is not added in the demand and time liabilities for calculation of SLR?: Capital and
reserves, inter bank deposits for maturity up to 14 days, borrowings from RBI and refinance from NABARD, SIDBI.
27. RBI controlsmoney supply through: change in CRR
28. Loan given to a director can be waived: after permission of RBI.
29. Under theOmbudsmen scheme, the Bank has to reply to the objection of the complainant within: onemonth
30. Locker should be broken open if it is not operated for _ year in case medium risk and _ year
in case of high risk customers: (3,1).
31. A post dated cheque is passed in the account of a customer. But another cheque which was in order was
dishonoured due to insufficient funds.What is the liability of the Banker?: Bank is liable to the drawer for paying post
dated cheque as bank is not justified in paying post dated cheque. The bank will be liable to drawer for damages on
account of wrongful dishonour of cheque.
32. Which type of preferential shares are treated as part of Tier I capital of the Bank?: Perpetual Non
Cumulative Preference Shares.
33. As per RBI guidelines, all banks are required classify business in various business segments with effect from
31-03-2008. The segments are: (a) Treasury (b) Corporate /Wholesale Banking, (c) Retail Banking, (d) Other Banking
Business. The geographical segments are 'domestic' and 'international'.
34. Customer of your bank asks for cash payment of crossed DD.What would you do?Generally payment only
through bank account. However, bank can pay after duly satisfying the genuineness of the draft and payee but bank will
continue to be liable to true owner if recipient is not true owner.
35. A cheque is presented for payment in which the amount in words and figures is different. Bank
should pay which amount?: amount written in words will be paid.
36. Whether aPrivate Limited company can be a partnerwithPublic Limited company to formaPartnership?Yes
37. In the context of Nomination, which is correct statement?:Signatures of nominee not required on
nomination form. Nominee's name should be mentioned on FDR if agreed by the customer.
38. A bearer cheque of Rs.7,000/- was presented. The cashier informed that the cheque can not be passed
as the balance is less by Rs.700/-. The tenderer credited the amount of shortfall and the cheque was paid.
Customer disputed the transaction.Whether bank is liable?: Yes. For disclosing balance to third party, bank is
liable to account holder.
39. _____________ As per KYC guidelines, the periodicity of obtention of photograph and latest
address proof for Low Risk. Customers is Medium Risk years and High Risk Customers is : 10
years, 8 years 2 years.
40. When an order passed by Banking Ombudsman is accepted by the complainant, the same
should be complied within: 1 month from the date of receipt of acceptance from the complainant.
41. Penalty for delay is per day if information is not furnished within prescribed time under Right to Information
Act:
42. A crossed DD was paid by cash. What risk is there for the Bank: Bank will be liable to true owner of
the DD if payment made to a person other than true owner (Section 129 of N I Act).
43. A cheque is written in English and Regional Language. Whether it can be paid?: Yes. A cheque
written in different language can be paid if otherwise in order.
44. Who cannot become a partner in a firm as per supreme court judgment HUF
45. Introducers liability / responsibility in case of an account holder defrauding Bank is : To assist the
Bank in locating the a/c holder - does not have legal liability
46. Nomination - Minor can be a nominee.
47. Inoperative accounts: 2 Years & above not operated.
48. RTI Act - party seeking information need not disclose the reasons for which the information sought for.
49. Counterfeit notes returned after police verification, the same has to be preserved for 3 years
subject to half yearly verification.
50. Validity period of cheque reduced to 3months from 1.4.12 as per : RBI Guidelines under sec 35A of B R Act
51. Crossed cheque payment across the counter to the authorized Officer of collecting Bank - can be
made and there are no violation as per NI Act. 255.
52. The consequence of non registration of Partnership - firm cannot sue others for its dues.
53. Banks are required to implement the award of Ombudsman unless a decision is taken to appeal
against the same within one month from the date of receipt of acceptance of the award by the
complainant.
54. Account holder A & B want to substitute their name with the name of their sons C & D in the
account. What should the bank do?: Substitution of all names is not allowed. At least one of the original
account holder should be retained in the account.
55. When only image of cheque is sent to the paying bank while sending cheque for collection instead
of sending the physical cheque, the process is called: Cheque Truncation
56. A Cheque partly written in English & partly in regional language is presented for-paymentWhat should
the bank do?: May be paid, if otherwise in order and the language other
than.English is the regional language of the area where the cheque is presented.
57. An authority has been granted in an account You have received information about the death of the
Principal. Today, you receive a cheque signed by the agent which is dated prior to the death of the Principal.What
should the bank do? : Cheque can not be paid as authority of agent comes to end with the death of the Principal.
58. You aremaintaining current account in the name of the Trust. You receive notice of death of one of the
trustees. After this notice, a cheque signed by the deceased trustee is presented for payment.What should the bank
do?: Chequemay be paid, if otherwise in order.
59. As per Consumer Protection Act, the period for filing appeal to State Commission against decision
of the District Forum is: maximum 30 days
60. Who can not be full fledged partner: Minor
61. Can Karta of HUF appoint Agent or delegate the powers to other co-parcener: Yes, he can do so.
62. Money deposited after receiving order may be attached in the case of: attachment order
63. Original & duplicate draft presented simultaneously for payment: Duplicate should be paid &
original should be returned.
64. Company has registered office at Delhi, factory at Kolkata & loan taken at Mumbai. For creating
equitable mortgage title deeds can be deposited at: any notified city.
65. Reasons for avoiding advance to Un-Registered Partnership Firm: Firm can not sue against anyone
for recovery of its debts but anyone can sue against the firm.
66. What is the effect of 'Not Negotiable Crossing'?: Transferee does not get better title than the transferor.
67. Payment of cheque can be stopped by: only Drawer of the cheque
68. Account payee crossing defined in:-Not defined any where
69. What is the current rate of interest paid on CRR?: NIL
70. How can be the transferability of Bill of exchange can be restricted? Bymaking restrictive endorsement
71. If on a Bill-of Exchange, two parallel lines are drawn and not negotiable is written between the lines, what
kind of the crossing will be there: Provisions relating to crossing are not applicable to Bill of Exchange.
72. Within priority sector, what is the allocation to weaker section?: 25%
73. Maximumtime within which replymust be given underRight to information act? 30 days
74. What is the status of Nominee? Trustee of Legal heirs
75. Safe deposit vault is governed by provisions of: Transfer of Property act
76. A cheque signed by agent has been presented after his death for payment.What should the bank do?: The
e
42. A crossed DD was paid by cash. What risk is there for the Bank: Bank will be liable to true owner of
the DD if payment made to a person other than true owner (Section 129 of N I Act).
43. A cheque is written in English and Regional Language. Whether it can be paid?: Yes. A cheque
written in different language can be paid if otherwise in order.
44. Who cannot become a partner in a firm as per supreme court judgment HUF
45. Introducers liability / responsibility in case of an account holder defrauding Bank is : To assist the
Bank in locating the a/c holder - does not have legal liability
46. Nomination - Minor can be a nominee.
47. Inoperative accounts: 2 Years & above not operated.
48. RTI Act - party seeking information need not disclose the reasons for which the information sought for.
49. Counterfeit notes returned after police verification, the same has to be preserved for 3 years
subject to half yearly verification.
50. Validity period of cheque reduced to 3months from 1.4.12 as per : RBI Guidelines under sec 35A of B R Act
51. Crossed cheque payment across the counter to the authorized Officer of collecting Bank - can be
made and there are no violation as per NI Act. 255.
52. The consequence of non registration of Partnership - firm cannot sue others for its dues.
53. Banks are required to implement the award of Ombudsman unless a decision is taken to appeal
against the same within one month from the date of receipt of acceptance of the award by the
complainant.
54. Account holder A & B want to substitute their name with the name of their sons C & D in the
account. What should the bank do?: Substitution of all names is not allowed. At least one of the original
account holder should be retained in the account.
55. When only image of cheque is sent to the paying bank while sending cheque for collection instead
of sending the physical cheque, the process is called: Cheque Truncation
56. A Cheque partly written in English & partly in regional language is presented for-paymentWhat should
the bank do?: May be paid, if otherwise in order and the language other
than.English is the regional language of the area where the cheque is presented.
57. An authority has been granted in an account You have received information about the death of the
Principal. Today, you receive a cheque signed by the agent which is dated prior to the death of the Principal.What
should the bank do? : Cheque can not be paid as authority of agent comes to end with the death of the Principal.
58. You aremaintaining current account in the name of the Trust. You receive notice of death of one of the
trustees. After this notice, a cheque signed by the deceased trustee is presented for payment.What should the bank
do?: Chequemay be paid, if otherwise in order.
59. As per Consumer Protection Act, the period for filing appeal to State Commission against decision
of the District Forum is: maximum 30 days
60. Who can not be full fledged partner: Minor
61. Can Karta of HUF appoint Agent or delegate the powers to other co-parcener: Yes, he can do so.
62. Money deposited after receiving order may be attached in the case of: attachment order
63. Original & duplicate draft presented simultaneously for payment: Duplicate should be paid &
original should be returned.
64. Company has registered office at Delhi, factory at Kolkata & loan taken at Mumbai. For creating
equitable mortgage title deeds can be deposited at: any notified city.
65. Reasons for avoiding advance to Un-Registered Partnership Firm: Firm can not sue against anyone
for recovery of its debts but anyone can sue against the firm.
66. What is the effect of 'Not Negotiable Crossing'?: Transferee does not get better title than the transferor.
67. Payment of cheque can be stopped by: only Drawer of the cheque
68. Account payee crossing defined in:-Not defined any where
69. What is the current rate of interest paid on CRR?: NIL
70. How can be the transferability of Bill of exchange can be restricted? Bymaking restrictive endorsement
71. If on a Bill-of Exchange, two parallel lines are drawn and not negotiable is written between the lines, what
kind of the crossing will be there: Provisions relating to crossing are not applicable to Bill of Exchange.
72. Within priority sector, what is the allocation to weaker section?: 25%
73. Maximumtime within which replymust be given underRight to information act? 30 days
74. What is the status of Nominee? Trustee of Legal heirs
75. Safe deposit vault is governed by provisions of: Transfer of Property act
76. A cheque signed by agent has been presented after his death for payment.What should the bank do?: The
cheque will be paid if otherwise in order.
77. Purpose of star series notes: To replace defectively printed notes
78. Customer-bank relationship in locker account: Lessee-Lessor
79. Upto what amount District forumcan be approached under Consumer Protection Act?: Rs.20 Lacs
80. Appeal against the award of Ombudsman can be made by the bank within: 30 days of receiving the
acceptance from the complainant.
81. Cheque issued by director of a company and presented after his death will be: Passed if in order
82. What would be the action of central bank in recession?: create liquidity by decreasing CRR and lower
the repo rate.
83. Ante dated cheque like cheque dated 15.12.07 is presented for payment on 1.1.08 whereas_ the account was
opened on 20.12.07 : Cheque should be passed
84. If amount in words and figures differ on a cheque and amount written in words is higher than the
amount written in figures, then as per sec.18 of NI Act, which amount should be paid?: amount written in
words
85. Nomination facility is not available in the case of : Trust A/c.
86. customer service Committee meeting held on : Monthly basis
87. A person wants to open a joint account with his wife in such a way that the account can be operated
by him only during his lifetime and she should be able to operate the account only after his death. The
account has to be opened with the instructions: 'Former or survivor'.
88. For wrongful dishonour of the cheque the bank is liable to: the drawer of the cheque
89. Banks print cheque books having similar particulars. The format of cheque is prescribed by which Act
: Not defined in any Act. It is as per practice. CTS 2010 advised by RBI
90. Which crossing takes away the feature of assumption of defective free title available to the transferee
: Not negotiable crossing
91. Who is appointed to tackle public complaints against the public authorities : Ombudsman
92. The facility of nomination is not available to Trust account because it is account : Non-individual
(facility of nomination is available only in the case of individual(s).
93. The true owner of a cheque has been deprived of his right by collection of the cheque for a different
person. This is called Conversion
94. As per recent RBI/Govt. guidelines, pensioners can open account jointly with: spouse, to be operated
as either or survivor or former or survivor.
95. While paying a bearer cheque, signatures are obtained on the back side of the cheque. Why ? : As
evidence of payment
96. Whether Minor can nominate ? no. On his behalf nomination will be done by a person legally
competent to act on his behalf.
97. Cheque is dated before date of its presentation is called: Antedated cheque
98. An endorsement in which endorser excludes his liability is called : sans recourse
99. When a company is financed against the security of hypothecation ormortgage of itsmovable property, the
company is required to file particulars of charge with: Registrar of Companies (no registration of charge required for
pledge).
100. Who is called as Holder as per N I Act?: Who is entitled to possession of the instrument in his own
name (actual possession is not necessary).
101. If a cheque is dishonoured due to insufficient funds, then as per section 138 of N I Act, court may
award imprisonment up to: 2years
102. On the face of a cheque, the name of a bank is written without two parallel lines. This will amount to : special
crossing
103. A/c payee crossing is defined in : it is not defined in any Act. It is as per practice
104. Nomination facility for deposit accounts is available under: 45ZA & 45 ZB of the BR act
105. Maximum amount of deposit which a bank may ask while allowing locker facility to a customer:
Advance rent for 3 years and locker breaking charges
106. A solicitor has account in his name and in the name of his client. Garnishee order is received in the name of the
solicitor.Whether the same will be applicable in the name of client also: No because two accounts are not in the same
right and same capacity.
107. Which of the following is not amaterial alteration? Changing bearer to order
108.
109. A bill issued without consideration is called: Accomodation Bill
110. There is a joint account in the name of A &B. A cheque is drawn by A but the alteration in the amount is
authenticated by B.Whether bank can pay the cheque: Yes provided the operation is either or survivor.
111. The term used for conversion or transfer of property derived from a criminal offense for the purpose
of concealing, or disguising, the illicit origin of the property is called: Money laundering
112. In which of the following situations bank will not be a holder in due course?: When bank credits the
account of the customer after receipt of funds on account of cheque sent for collection
113. The rate at which RBI rediscounts the usance bills of banks is called: Bank Rate
114. Which of the following is not true about RBI (a) RBI announces credit and monetary policy (b) RBI
maintains forex reserves (c) RBI allows ways and means advance to central Govt (d) Banking Secretary of
Union Govt is the Governor of RBI Ans is (d)
115. In the case of IPO, the company is required to allot shares ormake refund within: 30 days of the closure of
the issue in case of fixed price public issues; 15 days in case of book built issues and 15 days in case of right issues
112. Bankcanchargecollectionchargesofnotmorethanfor_outstationchequesofRs10000toRs1lacinsavingbank:Rs.100
113. Which of the following cheques can not be paid by the bank? : A cheque on which signatures of drawer have
been forged irrespective of the cleverness in forgery and though these appear to be same as that of the drawer.
114. FIU stands for : Financial Intelligence Unit (India)
115. Two cheques have been presented to you as paying banker. One is dated prior to opening the account and
other is dated prior to issue of cheque book.What will you do as paying banker?: Both cheques will be paid.
116. KYC and FIU in India are associated with: preventing money laundering
117. Articles of Association mentions: directors' powers
118. Garnishee order is not applicable on: (a)cash received after two hours of receipt of Garnishee order
(b) amount received for safe custody (c) undrawn balances in cash credit accounts
119. A person having locker has expired. The nominee comes. A sealed cover is found. What will you do ?
: It will be delivered to him as part of locker contents without opening the packet.
120. A bill was presented on 10.5.2005 and accepted on 12.5.2005. The bill was due for payment on
29.07.2005 and was returned. The last date for filing suit in this case is : 29.07.2008
121. A listed bank has to prepare and publish balance sheet on quarterly basis as per: SEBI guidelines
122. There are certain instruments defined as negotiable instruments under law and certain instruments used as
negotiable instruments as per practice.Which of the following is not a negotiable instrument as per NI Act: Dividend
warrant
123. On repayment of_debt of a company, satisfaction of charge shbuld be filed with ROC within: 30 days
124. A Trust Deed is silent about loans by the trust. The trustee approaches for a loan. Under these
circumstances what should the bank do?: No loan can be raised
125. Which of the following un/under-stamped document can not be revalidated by paying penalty: None of
these as all documents can be revalidated. (However, as per question Demand Promisory note cannot be
revalidated).
126. A person of 65 years of age can not nominate which of the following persons: Trust
127. The aggregate limit for capital market exposure of a Bank is: 40 0/0 of net worth at the end of previous year
128. The aggregate limit for capital market exposure of a Bank is: 40 0/0 of net worth at the end of previous year
129. A minor approaches for a loan. Which type of loan can be given to him: loan can not be sanctioned
other than for necessities.
130. A public limited company can start business after receiving from Registrar of Companies.
Certificate of commencement of business.
131. Which of the following does not match in banker/customer relation : Locker facility - Bailee/Bailor
132. Committee on Procedures and Performance Audit of Public Services (CPPAPS) was headed by:
S.S. Tarapore
133. Customer service code has been mentioned in : Banking Codes and Standards Board of India.
134. Cheque received in clearing signed by whom will not be passed out of the following: signed by a
person who has ' been declared insolvent.
135. Whether a customer can approach Ombudsman without first approaching the Bank : Approaching the
bank first is a pre-condition.
136. In case a forged note is detected in the cash tendered at bank counter, what should the bank do?:
The Note should be impounded and not returned to the tenderer.
137. If a guardian is appointed by court, minor will become major at the age of: 18years
138. A Cheque with forged signatures is presented for payment and is paid. Bank will be liable to:
Customer (Drawer of the cheque)
139. Protection is available to the collecting banker in case of : Crossed cheques
140. Which is not a General Crossing: Name of a bank written between two parallel lines
141. If time is not mentioned on a Bill of Exchange, it will be payable: on demand
142. Format of Cheque has been prescribed in which Act?: None because it is as per Practice and Usage
143. In an account of Club with you, cheque has been been presented for payment signed by the secretary
who has died. What should the bank do?: It will be paid if it not dated subsequent to date of death.
144. Garnishee order is applicable for: credit balance in OD and not for cheque sent for collection.
145. Bank Guarantees are issued as per provisions of : Indian Contract Act
146. cheque truncation means: converting physical cheque to electronic image and stopping physical flow
of a paper cheque. 660_ Foreign currency paid to taxi driver, shop keeper, can be accepted by: Authorised
persons.
147. A bank cannot acquire either as owner or as pledgee shares in a company more than:. 10 % of paid
capital of the company or 10% of the•paid up capital and reserves of the bank, whichever is lower.
148. For formation of a company, Registrar of Companies will issue : certificate of incorporation
149. There is a joint account in the name of A & B payable to either or survivor. On the death of A, the
amount will be payable to (a) nominee (b) B, the survivor.
150. Co is in liquidation, funds are at the disposal of : Liquidator
151. Guardian appointed by will of the father is called: testamentary guardian
152. The bill is dated 15/03/04, the date of acceptance: 20/03/04. The bill returned unpaid on
25/03/04. The limitation period will be available up to : 25/03/07
153. Which of the following documents does not constitute document of title to goods:Airway bill
154. DD can be revalidated within: any time (practice may differ In different banks)
155. Which crossing is a Special Crossing : Name of Bank is written in the cheque with or without parallel lines
156. Supervision of banks is done by RBI under which act: RBI Act / BR Act / Jilani Committee Report / NI
Act: Banking
Regulation Act
157. A minor is aged 15 years, who is illiterate. Which type of self operated a/c can be opened -SB/ RD / FD
none
158. Which of the following can open SB a/c? State Electricity Board/ Indian Bank Association/ Municipal
corporation: Indian Bank Association.
159. During death claim settlement for a locker with nomination, you find one sealed packed. What you will
do: Deliver the sealed packet without opening it.
160. In a Flying club, the Secretary & Treasurer are authorized to sign. A Cheque is presented for payment across the
counter. In between it has been informed that Secretary has died, what you will do? :Will be paid, if otherwise in order
161. Revival of limitation for recovery of a time barred loan is possible by: obtaining fresh promise to pay
under provisions of Indian Contract Act.
As per Supreme court decision, HUF cannot be a partner because: HUF is not a natural or legal person
162. As per Prevention of Money laundering Act, preservation of records relating to closed accounts upto:
5 yr from date of closure of account.
163. Banks can provide information about the customer to another Bank: General in nature, without any
responsibility
164. Board of Directors want to borrow money in excess of paid up capital and reserves of the company:
can be done through a resolution passed by shareholders in the general meeting
165. Other than aBill of exchange or promissory note, the documentwhichwas executed abroad is required to bestamped
on
its arrival in India within: 3 months of its arrival
166. Administrator is appointed in case of: to realize assets and pay off liabilities of a person who has died
without writing a will.
Under Ombudsman scheme, which type of case not entertained?: advocate representing the customer
167. Which of the following is not a valid cheque for payment by the bank-l)different ink & handwriting 2)
cheque with prior date 3) cheque with impossible date 4) Mutilated cheque: Mutilated cheque
168. The liability of the drawer of bills of exchange is prime till it is not accepted by the drawee after that
prime liability becomes of Drawee.
169. Whether Pvt Ltd. Co. can be partner with Partnership Firm: Yes
170. Provision on standard assets to be shown in balance sheet in other liabilities and provisions.
Provision for NPA is deducted from gross advances.
e
171. Counterfeit note received at the counter what to be done?: Impound the currency note.
172. No noting on currency note, directions issued by RBI under section 35A of BR Act.
173. Cross cheque can be paid at counter if presented by other bank.
174. Payments of a forged draft.Who will lodge FIR paying or collecting bank: Paying Bank.
175. Borrowing powers of board of directors are contained in: Articles of Association
176. Locker can be broken open after notice to the hirer if the same is not operated for:more than three years for
mediur-n risk category or one year for a higher risk category, and the locker-hirer does not respond nor operates the
locker.
177. If a complainant is not satisfied with the award or his complaint is rejected by the Banking ombudsmen, he can
prefer an appeal to Deputy Governor, RBI within: 30 days of the of the date of receipt of communication regarding
award or rejection of the complaint.
178. An account was opened on 24.11.2007 and the cheque book was issued on 30.11.2007. Two
cheques dated 18.11.2007 & 22.11.2007 are presented for payment on 08.12.2007. What should the bank
do?: The cheques can be passed if otherwise in order.
179. In case of wrongful dishonour of cheque, bank is liable to: account holder only
180. Who can seek information under.Right to Information Act: Any citizen of India can ask for information
181. The Garnishee Order is applicable on the account of a customer when the relationship between
banker customer is: Debtor & Creditor.
182. A private limited company with Registered office at Bangalore has raised loan froma branch located at
Mumbai. For creating equitablemortgage, title deeds can be deposited at: Mumbai, Kolkatta, Chennal or any other
notified place.
183. A cheque is presented for payment in which amount in figures ismentioned as Rs 10,000 whereas the amount in
words ismentioned as Rs Ten lakh only. In terms of section 18 of the NI Act, what should the bank do?: The amount
written in words should be paid.
184. A cheque of Rs.4700/- was presented for payment when the balance in the account was Rs. 4000/-. On being
returned for insufficient funds, the presenter enquired the balance and then deposited Rs.1000/- in the account.
Thereafter, the cheque was passed. The drawer of the cheque has lodged claimagainst the bank. Is the bank liable?:
Yes, the bank is liable for breach of secrecy.
185. When a letter is signed by the borrower and based on that letter bank delivers the document of title to
goods to the borrower, such letter is called as: Trust Receipt
186. How much charges are charged in addition to normal collection charges and out of pocket expenses
for providing instant credit facility for outstation cheques:Nil
187. A limited company has registered office at Chennai whereas loan has been raised from bank branch
at Mumbai. The charge will be registered with the ROC at: Chennai
188. A partnership firm conducting business other than the banking business has more than 20 members
as partners. Whether this is allowed?: Such association is called illegal association as per Companies Act
189. Under Prevention of Money Laundering Act, banks are required to send cash transaction report in
respect of cash deposit or withdrawal of more than Rs 10 lakh in a month from one account within: 15 days
from the close of the month.
190. Who is primarily liable on Bill of exchange which has been accepted?: Acceptor (Drawee) of the
Bill.
191. A cheque crossed specially to a bank is presented by the same bank to paying bank for cash
payment. What should the paying bank do? Bank can make cash payment.
192. Who can make nomination in the deposit account of a minor?: Guardian on behalf of the minor.
193. Who can be a nominee?: Only an individual
194. If a depositor dies, payment to nominee or legal heirs should be made within: 15 days of
completion of formalities.
195. What is the relationship between bank and customer if he has left certain goods with the bank by
mistake: Bank is trustee and Customer is beneficiary
196. Appeal against the award of the Banking Ombudsman can be made to Deputy Governor, RBI within
days of the receipt of copy of award from the Ombudsman: 30 days
197. A cheque was dishonoured despite sufficient balance in the account. The bank will be liable to:
Drawer of the cheque and not to the payee.
198. Maximum amount of fine under section 138 of N I Act for dishonour of cheque due to insufficient
funds is: twice the amount of cheque.
199. Banks print cheque books having similar particulars. The format of cheque is prescribed by which Act : It is a
practice
200. Bearer uncrossed cheque can be paid to whom: To the bearer
201. Who is appointed to tackle public complaints against the public authorities :Ombudsman
202. On, other than a negotiable instrument, what is the time period for payment of stamp duty, if the
document is executed outside India : 3 months
203. May I help you counter is to be provided by bank branches other than : Small branches
204. The facility of nomination is not available to Trust account because it is account : Non-individual
205. In case of a jointly operated joint account, the nominee can obtain payment, when : none of the account holder is
alive
206. Which crossing is not a general crossing :When name of bank is written within or without parallel lines.
207. The true owner of a cheque has been deprived his right by collection of the cheque for a different
person. This is called : Conversion
208. A bank branch receives a counterfeit note of Rs.1000, which customer wants back. What the bank
should do : Impound the currency note but credit full amount to customer. Receipt not to be issued to
depositor.
209. When rate of interest is expressed by adjusting the impact of inflation, this is called : Real rate of
Interest
210. Banks can ask for deposit of advance rent on hiring a locker for a period up to : 3 years
211. The drawer of a cheque wants that the endorsee should not get a defect free title when he receives an
endorsed cheque.What type of crossing would be required : Not-negotiable crossing.
212. The crossing on a cheque is required to be cancelled.Who can do so: DrawerBANKING LAWS INCLUDING NI,BR & RBI ACT AND PRACTICES
1. Provisions relating to Nomination are given in : Banking Regulation Act (Sec 45 ZA to 45 ZF)
2. As per section 26 of the Negotiable Instruments Act, a Minor can draw, endorse, accept a negotiable
instrument but he can not : bind himself
3. A has granted Irrevocable Power of Attorney in favour of B for one year. After 3 months, A
revokes the Power of Attorney. A cheque signed by B is presented for payment_ What will you do?
The cheque will not be paid because POA can be withdrawn before maturity and once it is revoked,
no cheque signed by agent can be debited to account of Principal
4. What is the Doctrine of Ultra Vires in the context of a limited company?: Any act by the directors
beyond the object of the company is considered ultra vires the company and company is not bound by such
act.
5. A minor who was admitted to the benefits of partnership has become major. Within how much period,
he has to decide to remain partner in the firm or not?: within 6 months of attaining majority or 6 months of
knowing that he is the partner in the firm whichever is later.
6. If on a cheque words "Account Payee" is written between two parallel lines or with the name of a
bank, then: the cheque can not be endorsed.
7. Which type of crossing is required to be done if the drawer wants that in case of endorsement, the
title of transferee of the cheque should not be better than the title of the transferor: Not Negotiable Crossing
8. In the case of dishonour of a cheque due to insufficient funds, for enforcing rights under section 138
of the Negotiable Instruments Act 1881, the holder should send a notice to the drawer within: 30 days from
the date of receipt of notice regarding dishonour of the instrument.
9. The iimitation period for filing case in case of dishonour of cheque due to insufficient funds is: 1 month
from the date of cause of action.
10. Objectives for which a company has been formed are given in: Memorandum of Association
Full formof BCBS is Basel Committee on Banking Supervision.
11. Direct Impact of increase in CRR is : Controlling Liquidity
12. Banks can not issue Demand Draft payable to Bearer as per provisions of : Section 31 of the RBI Act
13. Grace Period is allowed in the case of : Usance Bills and Usance Promissory Notes
14. Indian Banks are required to maintain minimum Capital Adequacy Ratio of : 9%
15. In the case of individuals and HUF, tax will be deducted at source if the interest on term deposit in a
financial year is : more than Rs 10,000
16. If Power of Attorney is executed outside India it should be stamped within:90 days of its first arrival in India
17. For its implementation, the complainant should accept the award given by Ombudsman within: 30
days of the receipt of the copy of the award.
18. When proceeds of cheque are given before clearance of the cheque the banker will be called: Holder
for Value
19. What do we 'mean by Surrender Value of Life Insurance Policy?: Minimum amount payable by the
insurance company in case of foreclosure of the policy before maturity.
20. In the case ofWrongful dishonour of cheque, to whomthe bank is liable?: Drawer
21. If date on a cheque is prior to the date of its presentation, it is called: Ante Dated cheque
22. What isminor's liability in HUF Account: Minor is not liable
23. When does the right of nominee starts in respect of a deposit account?: After death of all depositors
24. For injectingmoney in themarket which type of transaction is undertaken?: (a) Repo (b) Reverse Repo
25. Garnishee order is not applicable to: Unutilised portion of the Cash credit limit
26. Which of the following is not added in the demand and time liabilities for calculation of SLR?: Capital and
reserves, inter bank deposits for maturity up to 14 days, borrowings from RBI and refinance from NABARD, SIDBI.
27. RBI controlsmoney supply through: change in CRR
28. Loan given to a director can be waived: after permission of RBI.
29. Under theOmbudsmen scheme, the Bank has to reply to the objection of the complainant within: onemonth
30. Locker should be broken open if it is not operated for _ year in case medium risk and _ year
in case of high risk customers: (3,1).
31. A post dated cheque is passed in the account of a customer. But another cheque which was in order was
dishonoured due to insufficient funds.What is the liability of the Banker?: Bank is liable to the drawer for paying post
dated cheque as bank is not justified in paying post dated cheque. The bank will be liable to drawer for damages on
account of wrongful dishonour of cheque.
32. Which type of preferential shares are treated as part of Tier I capital of the Bank?: Perpetual Non
Cumulative Preference Shares.
33. As per RBI guidelines, all banks are required classify business in various business segments with effect from
31-03-2008. The segments are: (a) Treasury (b) Corporate /Wholesale Banking, (c) Retail Banking, (d) Other Banking
Business. The geographical segments are 'domestic' and 'international'.
34. Customer of your bank asks for cash payment of crossed DD.What would you do?Generally payment only
through bank account. However, bank can pay after duly satisfying the genuineness of the draft and payee but bank will
continue to be liable to true owner if recipient is not true owner.
35. A cheque is presented for payment in which the amount in words and figures is different. Bank
should pay which amount?: amount written in words will be paid.
36. Whether aPrivate Limited company can be a partnerwithPublic Limited company to formaPartnership?Yes
37. In the context of Nomination, which is correct statement?:Signatures of nominee not required on
nomination form. Nominee's name should be mentioned on FDR if agreed by the customer.
38. A bearer cheque of Rs.7,000/- was presented. The cashier informed that the cheque can not be passed
as the balance is less by Rs.700/-. The tenderer credited the amount of shortfall and the cheque was paid.
Customer disputed the transaction.Whether bank is liable?: Yes. For disclosing balance to third party, bank is
liable to account holder.
39. _____________ As per KYC guidelines, the periodicity of obtention of photograph and latest
address proof for Low Risk. Customers is Medium Risk years and High Risk Customers is : 10
years, 8 years 2 years.
40. When an order passed by Banking Ombudsman is accepted by the complainant, the same
should be complied within: 1 month from the date of receipt of acceptance from the complainant.
41. Penalty for delay is per day if information is not furnished within prescribed time under Right to Information
Act:
42. A crossed DD was paid by cash. What risk is there for the Bank: Bank will be liable to true owner of
the DD if payment made to a person other than true owner (Section 129 of N I Act).
43. A cheque is written in English and Regional Language. Whether it can be paid?: Yes. A cheque
written in different language can be paid if otherwise in order.
44. Who cannot become a partner in a firm as per supreme court judgment HUF
45. Introducers liability / responsibility in case of an account holder defrauding Bank is : To assist the
Bank in locating the a/c holder - does not have legal liability
46. Nomination - Minor can be a nominee.
47. Inoperative accounts: 2 Years & above not operated.
48. RTI Act - party seeking information need not disclose the reasons for which the information sought for.
49. Counterfeit notes returned after police verification, the same has to be preserved for 3 years
subject to half yearly verification.
50. Validity period of cheque reduced to 3months from 1.4.12 as per : RBI Guidelines under sec 35A of B R Act
51. Crossed cheque payment across the counter to the authorized Officer of collecting Bank - can be
made and there are no violation as per NI Act. 255.
52. The consequence of non registration of Partnership - firm cannot sue others for its dues.
53. Banks are required to implement the award of Ombudsman unless a decision is taken to appeal
against the same within one month from the date of receipt of acceptance of the award by the
complainant.
54. Account holder A & B want to substitute their name with the name of their sons C & D in the
account. What should the bank do?: Substitution of all names is not allowed. At least one of the original
account holder should be retained in the account.
55. When only image of cheque is sent to the paying bank while sending cheque for collection instead
of sending the physical cheque, the process is called: Cheque Truncation
56. A Cheque partly written in English & partly in regional language is presented for-paymentWhat should
the bank do?: May be paid, if otherwise in order and the language other
than.English is the regional language of the area where the cheque is presented.
57. An authority has been granted in an account You have received information about the death of the
Principal. Today, you receive a cheque signed by the agent which is dated prior to the death of the Principal.What
should the bank do? : Cheque can not be paid as authority of agent comes to end with the death of the Principal.
58. You aremaintaining current account in the name of the Trust. You receive notice of death of one of the
trustees. After this notice, a cheque signed by the deceased trustee is presented for payment.What should the bank
do?: Chequemay be paid, if otherwise in order.
59. As per Consumer Protection Act, the period for filing appeal to State Commission against decision
of the District Forum is: maximum 30 days
60. Who can not be full fledged partner: Minor
61. Can Karta of HUF appoint Agent or delegate the powers to other co-parcener: Yes, he can do so.
62. Money deposited after receiving order may be attached in the case of: attachment order
63. Original & duplicate draft presented simultaneously for payment: Duplicate should be paid &
original should be returned.
64. Company has registered office at Delhi, factory at Kolkata & loan taken at Mumbai. For creating
equitable mortgage title deeds can be deposited at: any notified city.
65. Reasons for avoiding advance to Un-Registered Partnership Firm: Firm can not sue against anyone
for recovery of its debts but anyone can sue against the firm.
66. What is the effect of 'Not Negotiable Crossing'?: Transferee does not get better title than the transferor.
67. Payment of cheque can be stopped by: only Drawer of the cheque
68. Account payee crossing defined in:-Not defined any where
69. What is the current rate of interest paid on CRR?: NIL
70. How can be the transferability of Bill of exchange can be restricted? Bymaking restrictive endorsement
71. If on a Bill-of Exchange, two parallel lines are drawn and not negotiable is written between the lines, what
kind of the crossing will be there: Provisions relating to crossing are not applicable to Bill of Exchange.
72. Within priority sector, what is the allocation to weaker section?: 25%
73. Maximumtime within which replymust be given underRight to information act? 30 days
74. What is the status of Nominee? Trustee of Legal heirs
75. Safe deposit vault is governed by provisions of: Transfer of Property act
76. A cheque signed by agent has been presented after his death for payment.What should the bank do?: The
e
42. A crossed DD was paid by cash. What risk is there for the Bank: Bank will be liable to true owner of
the DD if payment made to a person other than true owner (Section 129 of N I Act).
43. A cheque is written in English and Regional Language. Whether it can be paid?: Yes. A cheque
written in different language can be paid if otherwise in order.
44. Who cannot become a partner in a firm as per supreme court judgment HUF
45. Introducers liability / responsibility in case of an account holder defrauding Bank is : To assist the
Bank in locating the a/c holder - does not have legal liability
46. Nomination - Minor can be a nominee.
47. Inoperative accounts: 2 Years & above not operated.
48. RTI Act - party seeking information need not disclose the reasons for which the information sought for.
49. Counterfeit notes returned after police verification, the same has to be preserved for 3 years
subject to half yearly verification.
50. Validity period of cheque reduced to 3months from 1.4.12 as per : RBI Guidelines under sec 35A of B R Act
51. Crossed cheque payment across the counter to the authorized Officer of collecting Bank - can be
made and there are no violation as per NI Act. 255.
52. The consequence of non registration of Partnership - firm cannot sue others for its dues.
53. Banks are required to implement the award of Ombudsman unless a decision is taken to appeal
against the same within one month from the date of receipt of acceptance of the award by the
complainant.
54. Account holder A & B want to substitute their name with the name of their sons C & D in the
account. What should the bank do?: Substitution of all names is not allowed. At least one of the original
account holder should be retained in the account.
55. When only image of cheque is sent to the paying bank while sending cheque for collection instead
of sending the physical cheque, the process is called: Cheque Truncation
56. A Cheque partly written in English & partly in regional language is presented for-paymentWhat should
the bank do?: May be paid, if otherwise in order and the language other
than.English is the regional language of the area where the cheque is presented.
57. An authority has been granted in an account You have received information about the death of the
Principal. Today, you receive a cheque signed by the agent which is dated prior to the death of the Principal.What
should the bank do? : Cheque can not be paid as authority of agent comes to end with the death of the Principal.
58. You aremaintaining current account in the name of the Trust. You receive notice of death of one of the
trustees. After this notice, a cheque signed by the deceased trustee is presented for payment.What should the bank
do?: Chequemay be paid, if otherwise in order.
59. As per Consumer Protection Act, the period for filing appeal to State Commission against decision
of the District Forum is: maximum 30 days
60. Who can not be full fledged partner: Minor
61. Can Karta of HUF appoint Agent or delegate the powers to other co-parcener: Yes, he can do so.
62. Money deposited after receiving order may be attached in the case of: attachment order
63. Original & duplicate draft presented simultaneously for payment: Duplicate should be paid &
original should be returned.
64. Company has registered office at Delhi, factory at Kolkata & loan taken at Mumbai. For creating
equitable mortgage title deeds can be deposited at: any notified city.
65. Reasons for avoiding advance to Un-Registered Partnership Firm: Firm can not sue against anyone
for recovery of its debts but anyone can sue against the firm.
66. What is the effect of 'Not Negotiable Crossing'?: Transferee does not get better title than the transferor.
67. Payment of cheque can be stopped by: only Drawer of the cheque
68. Account payee crossing defined in:-Not defined any where
69. What is the current rate of interest paid on CRR?: NIL
70. How can be the transferability of Bill of exchange can be restricted? Bymaking restrictive endorsement
71. If on a Bill-of Exchange, two parallel lines are drawn and not negotiable is written between the lines, what
kind of the crossing will be there: Provisions relating to crossing are not applicable to Bill of Exchange.
72. Within priority sector, what is the allocation to weaker section?: 25%
73. Maximumtime within which replymust be given underRight to information act? 30 days
74. What is the status of Nominee? Trustee of Legal heirs
75. Safe deposit vault is governed by provisions of: Transfer of Property act
76. A cheque signed by agent has been presented after his death for payment.What should the bank do?: The
cheque will be paid if otherwise in order.
77. Purpose of star series notes: To replace defectively printed notes
78. Customer-bank relationship in locker account: Lessee-Lessor
79. Upto what amount District forumcan be approached under Consumer Protection Act?: Rs.20 Lacs
80. Appeal against the award of Ombudsman can be made by the bank within: 30 days of receiving the
acceptance from the complainant.
81. Cheque issued by director of a company and presented after his death will be: Passed if in order
82. What would be the action of central bank in recession?: create liquidity by decreasing CRR and lower
the repo rate.
83. Ante dated cheque like cheque dated 15.12.07 is presented for payment on 1.1.08 whereas_ the account was
opened on 20.12.07 : Cheque should be passed
84. If amount in words and figures differ on a cheque and amount written in words is higher than the
amount written in figures, then as per sec.18 of NI Act, which amount should be paid?: amount written in
words
85. Nomination facility is not available in the case of : Trust A/c.
86. customer service Committee meeting held on : Monthly basis
87. A person wants to open a joint account with his wife in such a way that the account can be operated
by him only during his lifetime and she should be able to operate the account only after his death. The
account has to be opened with the instructions: 'Former or survivor'.
88. For wrongful dishonour of the cheque the bank is liable to: the drawer of the cheque
89. Banks print cheque books having similar particulars. The format of cheque is prescribed by which Act
: Not defined in any Act. It is as per practice. CTS 2010 advised by RBI
90. Which crossing takes away the feature of assumption of defective free title available to the transferee
: Not negotiable crossing
91. Who is appointed to tackle public complaints against the public authorities : Ombudsman
92. The facility of nomination is not available to Trust account because it is account : Non-individual
(facility of nomination is available only in the case of individual(s).
93. The true owner of a cheque has been deprived of his right by collection of the cheque for a different
person. This is called Conversion
94. As per recent RBI/Govt. guidelines, pensioners can open account jointly with: spouse, to be operated
as either or survivor or former or survivor.
95. While paying a bearer cheque, signatures are obtained on the back side of the cheque. Why ? : As
evidence of payment
96. Whether Minor can nominate ? no. On his behalf nomination will be done by a person legally
competent to act on his behalf.
97. Cheque is dated before date of its presentation is called: Antedated cheque
98. An endorsement in which endorser excludes his liability is called : sans recourse
99. When a company is financed against the security of hypothecation ormortgage of itsmovable property, the
company is required to file particulars of charge with: Registrar of Companies (no registration of charge required for
pledge).
100. Who is called as Holder as per N I Act?: Who is entitled to possession of the instrument in his own
name (actual possession is not necessary).
101. If a cheque is dishonoured due to insufficient funds, then as per section 138 of N I Act, court may
award imprisonment up to: 2years
102. On the face of a cheque, the name of a bank is written without two parallel lines. This will amount to : special
crossing
103. A/c payee crossing is defined in : it is not defined in any Act. It is as per practice
104. Nomination facility for deposit accounts is available under: 45ZA & 45 ZB of the BR act
105. Maximum amount of deposit which a bank may ask while allowing locker facility to a customer:
Advance rent for 3 years and locker breaking charges
106. A solicitor has account in his name and in the name of his client. Garnishee order is received in the name of the
solicitor.Whether the same will be applicable in the name of client also: No because two accounts are not in the same
right and same capacity.
107. Which of the following is not amaterial alteration? Changing bearer to order
108.
109. A bill issued without consideration is called: Accomodation Bill
110. There is a joint account in the name of A &B. A cheque is drawn by A but the alteration in the amount is
authenticated by B.Whether bank can pay the cheque: Yes provided the operation is either or survivor.
111. The term used for conversion or transfer of property derived from a criminal offense for the purpose
of concealing, or disguising, the illicit origin of the property is called: Money laundering
112. In which of the following situations bank will not be a holder in due course?: When bank credits the
account of the customer after receipt of funds on account of cheque sent for collection
113. The rate at which RBI rediscounts the usance bills of banks is called: Bank Rate
114. Which of the following is not true about RBI (a) RBI announces credit and monetary policy (b) RBI
maintains forex reserves (c) RBI allows ways and means advance to central Govt (d) Banking Secretary of
Union Govt is the Governor of RBI Ans is (d)
115. In the case of IPO, the company is required to allot shares ormake refund within: 30 days of the closure of
the issue in case of fixed price public issues; 15 days in case of book built issues and 15 days in case of right issues
112. Bankcanchargecollectionchargesofnotmorethanfor_outstationchequesofRs10000toRs1lacinsavingbank:Rs.100
113. Which of the following cheques can not be paid by the bank? : A cheque on which signatures of drawer have
been forged irrespective of the cleverness in forgery and though these appear to be same as that of the drawer.
114. FIU stands for : Financial Intelligence Unit (India)
115. Two cheques have been presented to you as paying banker. One is dated prior to opening the account and
other is dated prior to issue of cheque book.What will you do as paying banker?: Both cheques will be paid.
116. KYC and FIU in India are associated with: preventing money laundering
117. Articles of Association mentions: directors' powers
118. Garnishee order is not applicable on: (a)cash received after two hours of receipt of Garnishee order
(b) amount received for safe custody (c) undrawn balances in cash credit accounts
119. A person having locker has expired. The nominee comes. A sealed cover is found. What will you do ?
: It will be delivered to him as part of locker contents without opening the packet.
120. A bill was presented on 10.5.2005 and accepted on 12.5.2005. The bill was due for payment on
29.07.2005 and was returned. The last date for filing suit in this case is : 29.07.2008
121. A listed bank has to prepare and publish balance sheet on quarterly basis as per: SEBI guidelines
122. There are certain instruments defined as negotiable instruments under law and certain instruments used as
negotiable instruments as per practice.Which of the following is not a negotiable instrument as per NI Act: Dividend
warrant
123. On repayment of_debt of a company, satisfaction of charge shbuld be filed with ROC within: 30 days
124. A Trust Deed is silent about loans by the trust. The trustee approaches for a loan. Under these
circumstances what should the bank do?: No loan can be raised
125. Which of the following un/under-stamped document can not be revalidated by paying penalty: None of
these as all documents can be revalidated. (However, as per question Demand Promisory note cannot be
revalidated).
126. A person of 65 years of age can not nominate which of the following persons: Trust
127. The aggregate limit for capital market exposure of a Bank is: 40 0/0 of net worth at the end of previous year
128. The aggregate limit for capital market exposure of a Bank is: 40 0/0 of net worth at the end of previous year
129. A minor approaches for a loan. Which type of loan can be given to him: loan can not be sanctioned
other than for necessities.
130. A public limited company can start business after receiving from Registrar of Companies.
Certificate of commencement of business.
131. Which of the following does not match in banker/customer relation : Locker facility - Bailee/Bailor
132. Committee on Procedures and Performance Audit of Public Services (CPPAPS) was headed by:
S.S. Tarapore
133. Customer service code has been mentioned in : Banking Codes and Standards Board of India.
134. Cheque received in clearing signed by whom will not be passed out of the following: signed by a
person who has ' been declared insolvent.
135. Whether a customer can approach Ombudsman without first approaching the Bank : Approaching the
bank first is a pre-condition.
136. In case a forged note is detected in the cash tendered at bank counter, what should the bank do?:
The Note should be impounded and not returned to the tenderer.
137. If a guardian is appointed by court, minor will become major at the age of: 18years
138. A Cheque with forged signatures is presented for payment and is paid. Bank will be liable to:
Customer (Drawer of the cheque)
139. Protection is available to the collecting banker in case of : Crossed cheques
140. Which is not a General Crossing: Name of a bank written between two parallel lines
141. If time is not mentioned on a Bill of Exchange, it will be payable: on demand
142. Format of Cheque has been prescribed in which Act?: None because it is as per Practice and Usage
143. In an account of Club with you, cheque has been been presented for payment signed by the secretary
who has died. What should the bank do?: It will be paid if it not dated subsequent to date of death.
144. Garnishee order is applicable for: credit balance in OD and not for cheque sent for collection.
145. Bank Guarantees are issued as per provisions of : Indian Contract Act
146. cheque truncation means: converting physical cheque to electronic image and stopping physical flow
of a paper cheque. 660_ Foreign currency paid to taxi driver, shop keeper, can be accepted by: Authorised
persons.
147. A bank cannot acquire either as owner or as pledgee shares in a company more than:. 10 % of paid
capital of the company or 10% of the•paid up capital and reserves of the bank, whichever is lower.
148. For formation of a company, Registrar of Companies will issue : certificate of incorporation
149. There is a joint account in the name of A & B payable to either or survivor. On the death of A, the
amount will be payable to (a) nominee (b) B, the survivor.
150. Co is in liquidation, funds are at the disposal of : Liquidator
151. Guardian appointed by will of the father is called: testamentary guardian
152. The bill is dated 15/03/04, the date of acceptance: 20/03/04. The bill returned unpaid on
25/03/04. The limitation period will be available up to : 25/03/07
153. Which of the following documents does not constitute document of title to goods:Airway bill
154. DD can be revalidated within: any time (practice may differ In different banks)
155. Which crossing is a Special Crossing : Name of Bank is written in the cheque with or without parallel lines
156. Supervision of banks is done by RBI under which act: RBI Act / BR Act / Jilani Committee Report / NI
Act: Banking
Regulation Act
157. A minor is aged 15 years, who is illiterate. Which type of self operated a/c can be opened -SB/ RD / FD
none
158. Which of the following can open SB a/c? State Electricity Board/ Indian Bank Association/ Municipal
corporation: Indian Bank Association.
159. During death claim settlement for a locker with nomination, you find one sealed packed. What you will
do: Deliver the sealed packet without opening it.
160. In a Flying club, the Secretary & Treasurer are authorized to sign. A Cheque is presented for payment across the
counter. In between it has been informed that Secretary has died, what you will do? :Will be paid, if otherwise in order
161. Revival of limitation for recovery of a time barred loan is possible by: obtaining fresh promise to pay
under provisions of Indian Contract Act.
As per Supreme court decision, HUF cannot be a partner because: HUF is not a natural or legal person
162. As per Prevention of Money laundering Act, preservation of records relating to closed accounts upto:
5 yr from date of closure of account.
163. Banks can provide information about the customer to another Bank: General in nature, without any
responsibility
164. Board of Directors want to borrow money in excess of paid up capital and reserves of the company:
can be done through a resolution passed by shareholders in the general meeting
165. Other than aBill of exchange or promissory note, the documentwhichwas executed abroad is required to bestamped
on
its arrival in India within: 3 months of its arrival
166. Administrator is appointed in case of: to realize assets and pay off liabilities of a person who has died
without writing a will.
Under Ombudsman scheme, which type of case not entertained?: advocate representing the customer
167. Which of the following is not a valid cheque for payment by the bank-l)different ink & handwriting 2)
cheque with prior date 3) cheque with impossible date 4) Mutilated cheque: Mutilated cheque
168. The liability of the drawer of bills of exchange is prime till it is not accepted by the drawee after that
prime liability becomes of Drawee.
169. Whether Pvt Ltd. Co. can be partner with Partnership Firm: Yes
170. Provision on standard assets to be shown in balance sheet in other liabilities and provisions.
Provision for NPA is deducted from gross advances.
e
171. Counterfeit note received at the counter what to be done?: Impound the currency note.
172. No noting on currency note, directions issued by RBI under section 35A of BR Act.
173. Cross cheque can be paid at counter if presented by other bank.
174. Payments of a forged draft.Who will lodge FIR paying or collecting bank: Paying Bank.
175. Borrowing powers of board of directors are contained in: Articles of Association
176. Locker can be broken open after notice to the hirer if the same is not operated for:more than three years for
mediur-n risk category or one year for a higher risk category, and the locker-hirer does not respond nor operates the
locker.
177. If a complainant is not satisfied with the award or his complaint is rejected by the Banking ombudsmen, he can
prefer an appeal to Deputy Governor, RBI within: 30 days of the of the date of receipt of communication regarding
award or rejection of the complaint.
178. An account was opened on 24.11.2007 and the cheque book was issued on 30.11.2007. Two
cheques dated 18.11.2007 & 22.11.2007 are presented for payment on 08.12.2007. What should the bank
do?: The cheques can be passed if otherwise in order.
179. In case of wrongful dishonour of cheque, bank is liable to: account holder only
180. Who can seek information under.Right to Information Act: Any citizen of India can ask for information
181. The Garnishee Order is applicable on the account of a customer when the relationship between
banker customer is: Debtor & Creditor.
182. A private limited company with Registered office at Bangalore has raised loan froma branch located at
Mumbai. For creating equitablemortgage, title deeds can be deposited at: Mumbai, Kolkatta, Chennal or any other
notified place.
183. A cheque is presented for payment in which amount in figures ismentioned as Rs 10,000 whereas the amount in
words ismentioned as Rs Ten lakh only. In terms of section 18 of the NI Act, what should the bank do?: The amount
written in words should be paid.
184. A cheque of Rs.4700/- was presented for payment when the balance in the account was Rs. 4000/-. On being
returned for insufficient funds, the presenter enquired the balance and then deposited Rs.1000/- in the account.
Thereafter, the cheque was passed. The drawer of the cheque has lodged claimagainst the bank. Is the bank liable?:
Yes, the bank is liable for breach of secrecy.
185. When a letter is signed by the borrower and based on that letter bank delivers the document of title to
goods to the borrower, such letter is called as: Trust Receipt
186. How much charges are charged in addition to normal collection charges and out of pocket expenses
for providing instant credit facility for outstation cheques:Nil
187. A limited company has registered office at Chennai whereas loan has been raised from bank branch
at Mumbai. The charge will be registered with the ROC at: Chennai
188. A partnership firm conducting business other than the banking business has more than 20 members
as partners. Whether this is allowed?: Such association is called illegal association as per Companies Act
189. Under Prevention of Money Laundering Act, banks are required to send cash transaction report in
respect of cash deposit or withdrawal of more than Rs 10 lakh in a month from one account within: 15 days
from the close of the month.
190. Who is primarily liable on Bill of exchange which has been accepted?: Acceptor (Drawee) of the
Bill.
191. A cheque crossed specially to a bank is presented by the same bank to paying bank for cash
payment. What should the paying bank do? Bank can make cash payment.
192. Who can make nomination in the deposit account of a minor?: Guardian on behalf of the minor.
193. Who can be a nominee?: Only an individual
194. If a depositor dies, payment to nominee or legal heirs should be made within: 15 days of
completion of formalities.
195. What is the relationship between bank and customer if he has left certain goods with the bank by
mistake: Bank is trustee and Customer is beneficiary
196. Appeal against the award of the Banking Ombudsman can be made to Deputy Governor, RBI within
days of the receipt of copy of award from the Ombudsman: 30 days
197. A cheque was dishonoured despite sufficient balance in the account. The bank will be liable to:
Drawer of the cheque and not to the payee.
198. Maximum amount of fine under section 138 of N I Act for dishonour of cheque due to insufficient
funds is: twice the amount of cheque.
199. Banks print cheque books having similar particulars. The format of cheque is prescribed by which Act : It is a
practice
200. Bearer uncrossed cheque can be paid to whom: To the bearer
201. Who is appointed to tackle public complaints against the public authorities :Ombudsman
202. On, other than a negotiable instrument, what is the time period for payment of stamp duty, if the
document is executed outside India : 3 months
203. May I help you counter is to be provided by bank branches other than : Small branches
204. The facility of nomination is not available to Trust account because it is account : Non-individual
BANKING LAWS INCLUDING NI,BR & RBI ACT AND PRACTICES
1. Provisions relating to Nomination are given in : Banking Regulation Act (Sec 45 ZA to 45 ZF)
2. As per section 26 of the Negotiable Instruments Act, a Minor can draw, endorse, accept a negotiable
instrument but he can not : bind himself
3. A has granted Irrevocable Power of Attorney in favour of B for one year. After 3 months, A
revokes the Power of Attorney. A cheque signed by B is presented for payment_ What will you do?
The cheque will not be paid because POA can be withdrawn before maturity and once it is revoked,
no cheque signed by agent can be debited to account of Principal
4. What is the Doctrine of Ultra Vires in the context of a limited company?: Any act by the directors
beyond the object of the company is considered ultra vires the company and company is not bound by such
act.
5. A minor who was admitted to the benefits of partnership has become major. Within how much period,
he has to decide to remain partner in the firm or not?: within 6 months of attaining majority or 6 months of
knowing that he is the partner in the firm whichever is later.
6. If on a cheque words "Account Payee" is written between two parallel lines or with the name of a
bank, then: the cheque can not be endorsed.
7. Which type of crossing is required to be done if the drawer wants that in case of endorsement, the
title of transferee of the cheque should not be better than the title of the transferor: Not Negotiable Crossing
8. In the case of dishonour of a cheque due to insufficient funds, for enforcing rights under section 138
of the Negotiable Instruments Act 1881, the holder should send a notice to the drawer within: 30 days from
the date of receipt of notice regarding dishonour of the instrument.
9. The iimitation period for filing case in case of dishonour of cheque due to insufficient funds is: 1 month
from the date of cause of action.
10. Objectives for which a company has been formed are given in: Memorandum of Association
Full formof BCBS is Basel Committee on Banking Supervision.
11. Direct Impact of increase in CRR is : Controlling Liquidity
12. Banks can not issue Demand Draft payable to Bearer as per provisions of : Section 31 of the RBI Act
13. Grace Period is allowed in the case of : Usance Bills and Usance Promissory Notes
14. Indian Banks are required to maintain minimum Capital Adequacy Ratio of : 9%
15. In the case of individuals and HUF, tax will be deducted at source if the interest on term deposit in a
financial year is : more than Rs 10,000
16. If Power of Attorney is executed outside India it should be stamped within:90 days of its first arrival in India
17. For its implementation, the complainant should accept the award given by Ombudsman within: 30
days of the receipt of the copy of the award.
18. When proceeds of cheque are given before clearance of the cheque the banker will be called: Holder
for Value
19. What do we 'mean by Surrender Value of Life Insurance Policy?: Minimum amount payable by the
insurance company in case of foreclosure of the policy before maturity.
20. In the case ofWrongful dishonour of cheque, to whomthe bank is liable?: Drawer
21. If date on a cheque is prior to the date of its presentation, it is called: Ante Dated cheque
22. What isminor's liability in HUF Account: Minor is not liable
23. When does the right of nominee starts in respect of a deposit account?: After death of all depositors
24. For injectingmoney in themarket which type of transaction is undertaken?: (a) Repo (b) Reverse Repo
25. Garnishee order is not applicable to: Unutilised portion of the Cash credit limit
26. Which of the following is not added in the demand and time liabilities for calculation of SLR?: Capital and
reserves, inter bank deposits for maturity up to 14 days, borrowings from RBI and refinance from NABARD, SIDBI.
27. RBI controlsmoney supply through: change in CRR
28. Loan given to a director can be waived: after permission of RBI.
29. Under theOmbudsmen scheme, the Bank has to reply to the objection of the complainant within: onemonth
30. Locker should be broken open if it is not operated for _ year in case medium risk and _ year
in case of high risk customers: (3,1).
31. A post dated cheque is passed in the account of a customer. But another cheque which was in order was
dishonoured due to insufficient funds.What is the liability of the Banker?: Bank is liable to the drawer for paying post
dated cheque as bank is not justified in paying post dated cheque. The bank will be liable to drawer for damages on
account of wrongful dishonour of cheque.
32. Which type of preferential shares are treated as part of Tier I capital of the Bank?: Perpetual Non
Cumulative Preference Shares.
33. As per RBI guidelines, all banks are required classify business in various business segments with effect from
31-03-2008. The segments are: (a) Treasury (b) Corporate /Wholesale Banking, (c) Retail Banking, (d) Other Banking
Business. The geographical segments are 'domestic' and 'international'.
34. Customer of your bank asks for cash payment of crossed DD.What would you do?Generally payment only
through bank account. However, bank can pay after duly satisfying the genuineness of the draft and payee but bank will
continue to be liable to true owner if recipient is not true owner.
35. A cheque is presented for payment in which the amount in words and figures is different. Bank
should pay which amount?: amount written in words will be paid.
36. Whether aPrivate Limited company can be a partnerwithPublic Limited company to formaPartnership?Yes
37. In the context of Nomination, which is correct statement?:Signatures of nominee not required on
nomination form. Nominee's name should be mentioned on FDR if agreed by the customer.
38. A bearer cheque of Rs.7,000/- was presented. The cashier informed that the cheque can not be passed
as the balance is less by Rs.700/-. The tenderer credited the amount of shortfall and the cheque was paid.
Customer disputed the transaction.Whether bank is liable?: Yes. For disclosing balance to third party, bank is
liable to account holder.
39. _____________ As per KYC guidelines, the periodicity of obtention of photograph and latest
address proof for Low Risk. Customers is Medium Risk years and High Risk Customers is : 10
years, 8 years 2 years.
40. When an order passed by Banking Ombudsman is accepted by the complainant, the same
should be complied within: 1 month from the date of receipt of acceptance from the complainant.
41. Penalty for delay is per day if information is not furnished within prescribed time under Right to Information
Act:
42. A crossed DD was paid by cash. What risk is there for the Bank: Bank will be liable to true owner of
the DD if payment made to a person other than true owner (Section 129 of N I Act).
43. A cheque is written in English and Regional Language. Whether it can be paid?: Yes. A cheque
written in different language can be paid if otherwise in order.
44. Who cannot become a partner in a firm as per supreme court judgment HUF
45. Introducers liability / responsibility in case of an account holder defrauding Bank is : To assist the
Bank in locating the a/c holder - does not have legal liability
46. Nomination - Minor can be a nominee.
47. Inoperative accounts: 2 Years & above not operated.
48. RTI Act - party seeking information need not disclose the reasons for which the information sought for.
49. Counterfeit notes returned after police verification, the same has to be preserved for 3 years
subject to half yearly verification.
50. Validity period of cheque reduced to 3months from 1.4.12 as per : RBI Guidelines under sec 35A of B R Act
51. Crossed cheque payment across the counter to the authorized Officer of collecting Bank - can be
made and there are no violation as per NI Act. 255.
52. The consequence of non registration of Partnership - firm cannot sue others for its dues.
53. Banks are required to implement the award of Ombudsman unless a decision is taken to appeal
against the same within one month from the date of receipt of acceptance of the award by the
complainant.
54. Account holder A & B want to substitute their name with the name of their sons C & D in the
account. What should the bank do?: Substitution of all names is not allowed. At least one of the original
account holder should be retained in the account.
55. When only image of cheque is sent to the paying bank while sending cheque for collection instead
of sending the physical cheque, the process is called: Cheque Truncation
56. A Cheque partly written in English & partly in regional language is presented for-paymentWhat should
the bank do?: May be paid, if otherwise in order and the language other
than.English is the regional language of the area where the cheque is presented.
57. An authority has been granted in an account You have received information about the death of the
Principal. Today, you receive a cheque signed by the agent which is dated prior to the death of the Principal.What
should the bank do? : Cheque can not be paid as authority of agent comes to end with the death of the Principal.
58. You aremaintaining current account in the name of the Trust. You receive notice of death of one of the
trustees. After this notice, a cheque signed by the deceased trustee is presented for payment.What should the bank
do?: Chequemay be paid, if otherwise in order.
59. As per Consumer Protection Act, the period for filing appeal to State Commission against decision
of the District Forum is: maximum 30 days
60. Who can not be full fledged partner: Minor
61. Can Karta of HUF appoint Agent or delegate the powers to other co-parcener: Yes, he can do so.
62. Money deposited after receiving order may be attached in the case of: attachment order
63. Original & duplicate draft presented simultaneously for payment: Duplicate should be paid &
original should be returned.
64. Company has registered office at Delhi, factory at Kolkata & loan taken at Mumbai. For creating
equitable mortgage title deeds can be deposited at: any notified city.
65. Reasons for avoiding advance to Un-Registered Partnership Firm: Firm can not sue against anyone
for recovery of its debts but anyone can sue against the firm.
66. What is the effect of 'Not Negotiable Crossing'?: Transferee does not get better title than the transferor.
67. Payment of cheque can be stopped by: only Drawer of the cheque
68. Account payee crossing defined in:-Not defined any where
69. What is the current rate of interest paid on CRR?: NIL
70. How can be the transferability of Bill of exchange can be restricted? Bymaking restrictive endorsement
71. If on a Bill-of Exchange, two parallel lines are drawn and not negotiable is written between the lines, what
kind of the crossing will be there: Provisions relating to crossing are not applicable to Bill of Exchange.
72. Within priority sector, what is the allocation to weaker section?: 25%
73. Maximumtime within which replymust be given underRight to information act? 30 days
74. What is the status of Nominee? Trustee of Legal heirs
75. Safe deposit vault is governed by provisions of: Transfer of Property act
76. A cheque signed by agent has been presented after his death for payment.What should the bank do?: The
e
42. A crossed DD was paid by cash. What risk is there for the Bank: Bank will be liable to true owner of
the DD if payment made to a person other than true owner (Section 129 of N I Act).
43. A cheque is written in English and Regional Language. Whether it can be paid?: Yes. A cheque
written in different language can be paid if otherwise in order.
44. Who cannot become a partner in a firm as per supreme court judgment HUF
45. Introducers liability / responsibility in case of an account holder defrauding Bank is : To assist the
Bank in locating the a/c holder - does not have legal liability
46. Nomination - Minor can be a nominee.
47. Inoperative accounts: 2 Years & above not operated.
48. RTI Act - party seeking information need not disclose the reasons for which the information sought for.
49. Counterfeit notes returned after police verification, the same has to be preserved for 3 years
subject to half yearly verification.
50. Validity period of cheque reduced to 3months from 1.4.12 as per : RBI Guidelines under sec 35A of B R Act
51. Crossed cheque payment across the counter to the authorized Officer of collecting Bank - can be
made and there are no violation as per NI Act. 255.
52. The consequence of non registration of Partnership - firm cannot sue others for its dues.
53. Banks are required to implement the award of Ombudsman unless a decision is taken to appeal
against the same within one month from the date of receipt of acceptance of the award by the
complainant.
54. Account holder A & B want to substitute their name with the name of their sons C & D in the
account. What should the bank do?: Substitution of all names is not allowed. At least one of the original
account holder should be retained in the account.
55. When only image of cheque is sent to the paying bank while sending cheque for collection instead
of sending the physical cheque, the process is called: Cheque Truncation
56. A Cheque partly written in English & partly in regional language is presented for-paymentWhat should
the bank do?: May be paid, if otherwise in order and the language other
than.English is the regional language of the area where the cheque is presented.
57. An authority has been granted in an account You have received information about the death of the
Principal. Today, you receive a cheque signed by the agent which is dated prior to the death of the Principal.What
should the bank do? : Cheque can not be paid as authority of agent comes to end with the death of the Principal.
58. You aremaintaining current account in the name of the Trust. You receive notice of death of one of the
trustees. After this notice, a cheque signed by the deceased trustee is presented for payment.What should the bank
do?: Chequemay be paid, if otherwise in order.
59. As per Consumer Protection Act, the period for filing appeal to State Commission against decision
of the District Forum is: maximum 30 days
60. Who can not be full fledged partner: Minor
61. Can Karta of HUF appoint Agent or delegate the powers to other co-parcener: Yes, he can do so.
62. Money deposited after receiving order may be attached in the case of: attachment order
63. Original & duplicate draft presented simultaneously for payment: Duplicate should be paid &
original should be returned.
64. Company has registered office at Delhi, factory at Kolkata & loan taken at Mumbai. For creating
equitable mortgage title deeds can be deposited at: any notified city.
65. Reasons for avoiding advance to Un-Registered Partnership Firm: Firm can not sue against anyone
for recovery of its debts but anyone can sue against the firm.
66. What is the effect of 'Not Negotiable Crossing'?: Transferee does not get better title than the transferor.
67. Payment of cheque can be stopped by: only Drawer of the cheque
68. Account payee crossing defined in:-Not defined any where
69. What is the current rate of interest paid on CRR?: NIL
70. How can be the transferability of Bill of exchange can be restricted? Bymaking restrictive endorsement
71. If on a Bill-of Exchange, two parallel lines are drawn and not negotiable is written between the lines, what
kind of the crossing will be there: Provisions relating to crossing are not applicable to Bill of Exchange.
72. Within priority sector, what is the allocation to weaker section?: 25%
73. Maximumtime within which replymust be given underRight to information act? 30 days
74. What is the status of Nominee? Trustee of Legal heirs
75. Safe deposit vault is governed by provisions of: Transfer of Property act
76. A cheque signed by agent has been presented after his death for payment.What should the bank do?: The
cheque will be paid if otherwise in order.
77. Purpose of star series notes: To replace defectively printed notes
78. Customer-bank relationship in locker account: Lessee-Lessor
79. Upto what amount District forumcan be approached under Consumer Protection Act?: Rs.20 Lacs
80. Appeal against the award of Ombudsman can be made by the bank within: 30 days of receiving the
acceptance from the complainant.
81. Cheque issued by director of a company and presented after his death will be: Passed if in order
82. What would be the action of central bank in recession?: create liquidity by decreasing CRR and lower
the repo rate.
83. Ante dated cheque like cheque dated 15.12.07 is presented for payment on 1.1.08 whereas_ the account was
opened on 20.12.07 : Cheque should be passed
84. If amount in words and figures differ on a cheque and amount written in words is higher than the
amount written in figures, then as per sec.18 of NI Act, which amount should be paid?: amount written in
words
85. Nomination facility is not available in the case of : Trust A/c.
86. customer service Committee meeting held on : Monthly basis
87. A person wants to open a joint account with his wife in such a way that the account can be operated
by him only during his lifetime and she should be able to operate the account only after his death. The
account has to be opened with the instructions: 'Former or survivor'.
88. For wrongful dishonour of the cheque the bank is liable to: the drawer of the cheque
89. Banks print cheque books having similar particulars. The format of cheque is prescribed by which Act
: Not defined in any Act. It is as per practice. CTS 2010 advised by RBI
90. Which crossing takes away the feature of assumption of defective free title available to the transferee
: Not negotiable crossing
91. Who is appointed to tackle public complaints against the public authorities : Ombudsman
92. The facility of nomination is not available to Trust account because it is account : Non-individual
(facility of nomination is available only in the case of individual(s).
93. The true owner of a cheque has been deprived of his right by collection of the cheque for a different
person. This is called Conversion
94. As per recent RBI/Govt. guidelines, pensioners can open account jointly with: spouse, to be operated
as either or survivor or former or survivor.
95. While paying a bearer cheque, signatures are obtained on the back side of the cheque. Why ? : As
evidence of payment
96. Whether Minor can nominate ? no. On his behalf nomination will be done by a person legally
competent to act on his behalf.
97. Cheque is dated before date of its presentation is called: Antedated cheque
98. An endorsement in which endorser excludes his liability is called : sans recourse
99. When a company is financed against the security of hypothecation ormortgage of itsmovable property, the
company is required to file particulars of charge with: Registrar of Companies (no registration of charge required for
pledge).
100. Who is called as Holder as per N I Act?: Who is entitled to possession of the instrument in his own
name (actual possession is not necessary).
101. If a cheque is dishonoured due to insufficient funds, then as per section 138 of N I Act, court may
award imprisonment up to: 2years
102. On the face of a cheque, the name of a bank is written without two parallel lines. This will amount to : special
crossing
103. A/c payee crossing is defined in : it is not defined in any Act. It is as per practice
104. Nomination facility for deposit accounts is available under: 45ZA & 45 ZB of the BR act
105. Maximum amount of deposit which a bank may ask while allowing locker facility to a customer:
Advance rent for 3 years and locker breaking charges
106. A solicitor has account in his name and in the name of his client. Garnishee order is received in the name of the
solicitor.Whether the same will be applicable in the name of client also: No because two accounts are not in the same
right and same capacity.
107. Which of the following is not amaterial alteration? Changing bearer to order
108.
109. A bill issued without consideration is called: Accomodation Bill
110. There is a joint account in the name of A &B. A cheque is drawn by A but the alteration in the amount is
authenticated by B.Whether bank can pay the cheque: Yes provided the operation is either or survivor.
111. The term used for conversion or transfer of property derived from a criminal offense for the purpose
of concealing, or disguising, the illicit origin of the property is called: Money laundering
112. In which of the following situations bank will not be a holder in due course?: When bank credits the
account of the customer after receipt of funds on account of cheque sent for collection
113. The rate at which RBI rediscounts the usance bills of banks is called: Bank Rate
114. Which of the following is not true about RBI (a) RBI announces credit and monetary policy (b) RBI
maintains forex reserves (c) RBI allows ways and means advance to central Govt (d) Banking Secretary of
Union Govt is the Governor of RBI Ans is (d)
115. In the case of IPO, the company is required to allot shares ormake refund within: 30 days of the closure of
the issue in case of fixed price public issues; 15 days in case of book built issues and 15 days in case of right issues
112. Bankcanchargecollectionchargesofnotmorethanfor_outstationchequesofRs10000toRs1lacinsavingbank:Rs.100
113. Which of the following cheques can not be paid by the bank? : A cheque on which signatures of drawer have
been forged irrespective of the cleverness in forgery and though these appear to be same as that of the drawer.
114. FIU stands for : Financial Intelligence Unit (India)
115. Two cheques have been presented to you as paying banker. One is dated prior to opening the account and
other is dated prior to issue of cheque book.What will you do as paying banker?: Both cheques will be paid.
116. KYC and FIU in India are associated with: preventing money laundering
117. Articles of Association mentions: directors' powers
118. Garnishee order is not applicable on: (a)cash received after two hours of receipt of Garnishee order
(b) amount received for safe custody (c) undrawn balances in cash credit accounts
119. A person having locker has expired. The nominee comes. A sealed cover is found. What will you do ?
: It will be delivered to him as part of locker contents without opening the packet.
120. A bill was presented on 10.5.2005 and accepted on 12.5.2005. The bill was due for payment on
29.07.2005 and was returned. The last date for filing suit in this case is : 29.07.2008
121. A listed bank has to prepare and publish balance sheet on quarterly basis as per: SEBI guidelines
122. There are certain instruments defined as negotiable instruments under law and certain instruments used as
negotiable instruments as per practice.Which of the following is not a negotiable instrument as per NI Act: Dividend
warrant
123. On repayment of_debt of a company, satisfaction of charge shbuld be filed with ROC within: 30 days
124. A Trust Deed is silent about loans by the trust. The trustee approaches for a loan. Under these
circumstances what should the bank do?: No loan can be raised
125. Which of the following un/under-stamped document can not be revalidated by paying penalty: None of
these as all documents can be revalidated. (However, as per question Demand Promisory note cannot be
revalidated).
126. A person of 65 years of age can not nominate which of the following persons: Trust
127. The aggregate limit for capital market exposure of a Bank is: 40 0/0 of net worth at the end of previous year
128. The aggregate limit for capital market exposure of a Bank is: 40 0/0 of net worth at the end of previous year
129. A minor approaches for a loan. Which type of loan can be given to him: loan can not be sanctioned
other than for necessities.
130. A public limited company can start business after receiving from Registrar of Companies.
Certificate of commencement of business.
131. Which of the following does not match in banker/customer relation : Locker facility - Bailee/Bailor
132. Committee on Procedures and Performance Audit of Public Services (CPPAPS) was headed by:
S.S. Tarapore
133. Customer service code has been mentioned in : Banking Codes and Standards Board of India.
134. Cheque received in clearing signed by whom will not be passed out of the following: signed by a
person who has ' been declared insolvent.
135. Whether a customer can approach Ombudsman without first approaching the Bank : Approaching the
bank first is a pre-condition.
136. In case a forged note is detected in the cash tendered at bank counter, what should the bank do?:
The Note should be impounded and not returned to the tenderer.
137. If a guardian is appointed by court, minor will become major at the age of: 18years
138. A Cheque with forged signatures is presented for payment and is paid. Bank will be liable to:
Customer (Drawer of the cheque)
139. Protection is available to the collecting banker in case of : Crossed cheques
140. Which is not a General Crossing: Name of a bank written between two parallel lines
141. If time is not mentioned on a Bill of Exchange, it will be payable: on demand
142. Format of Cheque has been prescribed in which Act?: None because it is as per Practice and Usage
143. In an account of Club with you, cheque has been been presented for payment signed by the secretary
who has died. What should the bank do?: It will be paid if it not dated subsequent to date of death.
144. Garnishee order is applicable for: credit balance in OD and not for cheque sent for collection.
145. Bank Guarantees are issued as per provisions of : Indian Contract Act
146. cheque truncation means: converting physical cheque to electronic image and stopping physical flow
of a paper cheque. 660_ Foreign currency paid to taxi driver, shop keeper, can be accepted by: Authorised
persons.
147. A bank cannot acquire either as owner or as pledgee shares in a company more than:. 10 % of paid
capital of the company or 10% of the•paid up capital and reserves of the bank, whichever is lower.
148. For formation of a company, Registrar of Companies will issue : certificate of incorporation
149. There is a joint account in the name of A & B payable to either or survivor. On the death of A, the
amount will be payable to (a) nominee (b) B, the survivor.
150. Co is in liquidation, funds are at the disposal of : Liquidator
151. Guardian appointed by will of the father is called: testamentary guardian
152. The bill is dated 15/03/04, the date of acceptance: 20/03/04. The bill returned unpaid on
25/03/04. The limitation period will be available up to : 25/03/07
153. Which of the following documents does not constitute document of title to goods:Airway bill
154. DD can be revalidated within: any time (practice may differ In different banks)
155. Which crossing is a Special Crossing : Name of Bank is written in the cheque with or without parallel lines
156. Supervision of banks is done by RBI under which act: RBI Act / BR Act / Jilani Committee Report / NI
Act: Banking
Regulation Act
157. A minor is aged 15 years, who is illiterate. Which type of self operated a/c can be opened -SB/ RD / FD
none
158. Which of the following can open SB a/c? State Electricity Board/ Indian Bank Association/ Municipal
corporation: Indian Bank Association.
159. During death claim settlement for a locker with nomination, you find one sealed packed. What you will
do: Deliver the sealed packet without opening it.
160. In a Flying club, the Secretary & Treasurer are authorized to sign. A Cheque is presented for payment across the
counter. In between it has been informed that Secretary has died, what you will do? :Will be paid, if otherwise in order
161. Revival of limitation for recovery of a time barred loan is possible by: obtaining fresh promise to pay
under provisions of Indian Contract Act.
As per Supreme court decision, HUF cannot be a partner because: HUF is not a natural or legal person
162. As per Prevention of Money laundering Act, preservation of records relating to closed accounts upto:
5 yr from date of closure of account.
163. Banks can provide information about the customer to another Bank: General in nature, without any
responsibility
164. Board of Directors want to borrow money in excess of paid up capital and reserves of the company:
can be done through a resolution passed by shareholders in the general meeting
165. Other than aBill of exchange or promissory note, the documentwhichwas executed abroad is required to bestamped
on
its arrival in India within: 3 months of its arrival
166. Administrator is appointed in case of: to realize assets and pay off liabilities of a person who has died
without writing a will.
Under Ombudsman scheme, which type of case not entertained?: advocate representing the customer
167. Which of the following is not a valid cheque for payment by the bank-l)different ink & handwriting 2)
cheque with prior date 3) cheque with impossible date 4) Mutilated cheque: Mutilated cheque
168. The liability of the drawer of bills of exchange is prime till it is not accepted by the drawee after that
prime liability becomes of Drawee.
169. Whether Pvt Ltd. Co. can be partner with Partnership Firm: Yes
170. Provision on standard assets to be shown in balance sheet in other liabilities and provisions.
Provision for NPA is deducted from gross advances.
e
171. Counterfeit note received at the counter what to be done?: Impound the currency note.
172. No noting on currency note, directions issued by RBI under section 35A of BR Act.
173. Cross cheque can be paid at counter if presented by other bank.
174. Payments of a forged draft.Who will lodge FIR paying or collecting bank: Paying Bank.
175. Borrowing powers of board of directors are contained in: Articles of Association
176. Locker can be broken open after notice to the hirer if the same is not operated for:more than three years for
mediur-n risk category or one year for a higher risk category, and the locker-hirer does not respond nor operates the
locker.
177. If a complainant is not satisfied with the award or his complaint is rejected by the Banking ombudsmen, he can
prefer an appeal to Deputy Governor, RBI within: 30 days of the of the date of receipt of communication regarding
award or rejection of the complaint.
178. An account was opened on 24.11.2007 and the cheque book was issued on 30.11.2007. Two
cheques dated 18.11.2007 & 22.11.2007 are presented for payment on 08.12.2007. What should the bank
do?: The cheques can be passed if otherwise in order.
179. In case of wrongful dishonour of cheque, bank is liable to: account holder only
180. Who can seek information under.Right to Information Act: Any citizen of India can ask for information
181. The Garnishee Order is applicable on the account of a customer when the relationship between
banker customer is: Debtor & Creditor.
182. A private limited company with Registered office at Bangalore has raised loan froma branch located at
Mumbai. For creating equitablemortgage, title deeds can be deposited at: Mumbai, Kolkatta, Chennal or any other
notified place.
183. A cheque is presented for payment in which amount in figures ismentioned as Rs 10,000 whereas the amount in
words ismentioned as Rs Ten lakh only. In terms of section 18 of the NI Act, what should the bank do?: The amount
written in words should be paid.
184. A cheque of Rs.4700/- was presented for payment when the balance in the account was Rs. 4000/-. On being
returned for insufficient funds, the presenter enquired the balance and then deposited Rs.1000/- in the account.
Thereafter, the cheque was passed. The drawer of the cheque has lodged claimagainst the bank. Is the bank liable?:
Yes, the bank is liable for breach of secrecy.
185. When a letter is signed by the borrower and based on that letter bank delivers the document of title to
goods to the borrower, such letter is called as: Trust Receipt
186. How much charges are charged in addition to normal collection charges and out of pocket expenses
for providing instant credit facility for outstation cheques:Nil
187. A limited company has registered office at Chennai whereas loan has been raised from bank branch
at Mumbai. The charge will be registered with the ROC at: Chennai
188. A partnership firm conducting business other than the banking business has more than 20 members
as partners. Whether this is allowed?: Such association is called illegal association as per Companies Act
189. Under Prevention of Money Laundering Act, banks are required to send cash transaction report in
respect of cash deposit or withdrawal of more than Rs 10 lakh in a month from one account within: 15 days
from the close of the month.
190. Who is primarily liable on Bill of exchange which has been accepted?: Acceptor (Drawee) of the
Bill.
191. A cheque crossed specially to a bank is presented by the same bank to paying bank for cash
payment. What should the paying bank do? Bank can make cash payment.
192. Who can make nomination in the deposit account of a minor?: Guardian on behalf of the minor.
193. Who can be a nominee?: Only an individual
194. If a depositor dies, payment to nominee or legal heirs should be made within: 15 days of
completion of formalities.
195. What is the relationship between bank and customer if he has left certain goods with the bank by
mistake: Bank is trustee and Customer is beneficiary
196. Appeal against the award of the Banking Ombudsman can be made to Deputy Governor, RBI within
days of the receipt of copy of award from the Ombudsman: 30 days
197. A cheque was dishonoured despite sufficient balance in the account. The bank will be liable to:
Drawer of the cheque and not to the payee.
198. Maximum amount of fine under section 138 of N I Act for dishonour of cheque due to insufficient
funds is: twice the amount of cheque.
199. Banks print cheque books having similar particulars. The format of cheque is prescribed by which Act : It is a
practice
200. Bearer uncrossed cheque can be paid to whom: To the bearer
201. Who is appointed to tackle public complaints against the public authorities :Ombudsman
202. On, other than a negotiable instrument, what is the time period for payment of stamp duty, if the
document is executed outside India : 3 months
203. May I help you counter is to be provided by bank branches other than : Small branches
204. The facility of nomination is not available to Trust account because it is account : Non-individual
205. In case of a jointly operated joint account, the nominee can obtain payment, when : none of the account holder is
alive
206. Which crossing is not a general crossing :When name of bank is written within or without parallel lines.
207. The true owner of a cheque has been deprived his right by collection of the cheque for a different
person. This is called : Conversion
208. A bank branch receives a counterfeit note of Rs.1000, which customer wants back. What the bank
should do : Impound the currency note but credit full amount to customer. Receipt not to be issued to
depositor.
209. When rate of interest is expressed by adjusting the impact of inflation, this is called : Real rate of
Interest
210. Banks can ask for deposit of advance rent on hiring a locker for a period up to : 3 years
211. The drawer of a cheque wants that the endorsee should not get a defect free title when he receives an
endorsed cheque.What type of crossing would be required : Not-negotiable crossing.
212. The crossing on a cheque is required to be cancelled.Who can do so: Draweralive
206. Which crossing is not a general crossing :When name of bank is written within or without parallel lines.
207. The true owner of a cheque has been deprived his right by collection of the cheque for a different
person. This is called : Conversion
208. A bank branch receives a counterfeit note of Rs.1000, which customer wants back. What the bank
should do : Impound the currency note but credit full amount to customer. Receipt not to be issued to
depositor.
209. When rate of interest is expressed by adjusting the impact of inflation, this is called : Real rate of
Interest
210. Banks can ask for deposit of advance rent on hiring a locker for a period up to : 3 years
211. The drawer of a cheque wants that the endorsee should not get a defect free title when he receives an
endorsed cheque.What type of crossing would be required : Not-negotiable crossing.
212. The crossing on a cheque is required to be cancelled.Who can do so: Drawer
