Saving account

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

29 March 2016 Dear Experts,
Plz explain why we usually Not use the saving account in business transaction if i do so then what circumstances may be occur,

Ply Reply....

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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29 March 2016 As per RBI directive savings account not to be opened for business purposes. If business transactions are operated the sb ac will be freezed.

Murtaza I Bhagat

Murtaza I Bhagat (Expert)
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29 March 2016 Yes agreed with sir, the name says its a saving account and one kind of personal account so why we do business transaction in saving/personal account. for business transactions we have to opened current account.

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Querist : Anonymous

Querist : Anonymous (Querist)

29 March 2016 Sir... is there any section/ clause as per the RBI guidelines not to use saving account in business

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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29 March 2016 Ask your banker he will show you the RBI guidelines.

Querist : Anonymous

Querist : Anonymous (Querist)

29 March 2016 Sir what do you means by your saving account will be freezed

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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29 March 2016 You will not be allowed to operate the account but you can close the account and withdraw the amount.

Querist : Anonymous

Querist : Anonymous (Querist)

29 March 2016 Sir one more question in this regard...some CA has advised that if you have proper evidence to explain the sourses of funding to income tax then you can operate the SB in business, not problem from income tax also not from bank/RBI side,

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CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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29 March 2016 Income tax no problem but bank/ RBI will not allow.

Querist : Anonymous

Querist : Anonymous (Querist)

29 March 2016 Sir my friend is distributor of battery who is openly doing business transaction from his saving account from the last 7 year. Inspite that No objection from the bank side yet....

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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30 March 2016 It may have escaped the attention of bank.

Murtaza I Bhagat

Murtaza I Bhagat (Expert)
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30 March 2016 Many People in india don't have their Driving License but they are driving vehicles but when they caught they are penalized and then they realized what is right and what is wrong..!!! we have to wait for that system to follow rules strictly. Thats why we have to follow every rules voluntarily. My friend try to understand don't break any rules in future rules hurts you badly. so in savings only Rs.1000/- minimum balance have to maintain and in Current (Personal) Rs. 3000/- to Rs. 5000/-. so there is no big difference. so tell your friend to open a current account and do all business transaction and just be safe from his side.

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