Recently it was reported in media that RBI has directed banks to close HUF accounts by 31st March 2011 . The move is actually on accont of insertion of amendment brought by Government of India Notification G.S.R. 956 (E) dated December 7, 2010 by which an insertion in section 9(3) of Public Provident Fund Scheme, 1968 scheme which is as under
“Provided further that an account opened on behalf of a Hindu Undivided Family prior to the 13th day of May, 2005, shall be closed after expiry of fifteen years from the end of the year in which the initial subscription was made and the entire amount standing at the credit of the subscriber shall be refunded, after making adjustments, if any, in respect of any interest due from the subscriber on loans taken by him.
In the case of accounts opened on behalf of Hindu Undivided Family, where fifteen years from end of the year in which initial subscription was made, has already been completed, they shall also be closed at the end of the current year, i.e. the 31st day of March, 2011 and the entire amount standing at the credit of the subscriber shall be refunded, after making adjustments, if any, in respect of any interest due from the subscriber on loans taken by him.”
What does it mean ?
It mean nothing to ordinary person because HUF or Association or Person or TRUST or any artificial juridcal person was prohibited long ago in the year 2005 only to open any Public Providend Fund account . Now thegovernment is only makin gcertain amendments which will faciliate the law mad by government long ago.