Amount Of PPF A/C Not Liable To Any Attachment In Respect Of Debt Or Liability Incurred By Account Holder: Gujarat HC

The Gujarat High Court has held that the amount of the Public Provident Fund (PPF) Account shall not be liable to be attached in respect of any debt or liability incurred by the account holder.

The Single Bench of Justice A.S. Supehia observed that "It is well settled proposition of law that the amount of Public Provident Fund account shall not be liable to any attachment in respect of any debt or liability incurred by the account holder."

In this case the petitioner had a PPF Account under the Public Provident Fund Scheme, 1968 with the respondent-Bank in the name of Rajnikant Punjalal Shah Hindu Undivided Family (HUF). The petitioner was investing HUF's money in the said account.

It was submitted that the respondent Bank had illegally and without the petitioner's consent debited the amount of Rs.85,380/- from his PPF Account to the Cash Credit Account of his partnership firm.

Advocate Aditya Gupta appearing for the petitioner submitted that the Government of India vide notification had clarified that the amount in the PPF Account shall not be liable to any attachment in respect of any debt or liability incurred by the account holder.

He further contended that the action of the respondent Bank of debiting the aforesaid amount from the PPF Account of the petitioner was illegal and de hors the procedure prescribed in law.

He prayed that the respondent Bank be directed to refund the amount from the petitioners' provident fund account.

On the contrary Advocate, Nalini Lodha appearing for the respondent Bank submitted that the respondent Bank was forced to withdraw the amount of PPF Account. She further submitted that the bank had, along with the partners of the firm and others in their personal and individual capacity, executed General Form of Guarantee in 2018 for Rs.24,00,00,000/- and that the petitioner, along with other guarantors, were liable to pay the entire debt due to the respondent Bank.

The Court observed that the action of the respondent Bank of withdrawing/debiting the aforesaid amount from the PPF Account of the petitioner was illegal and unjustified as the amount of PPF account shall not be liable to any attachment in respect of any debt or liability incurred by the account holder.

Accordingly, the Court directed the respondent-bank to deposit the amount within a period of four weeks in the Savings Bank Account of the petitioner.

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