Orissa High Court Allows Premature Withdrawal of Fixed Deposits for Marriage Necessity

Court interprets Rule 8(d) of National Savings Time Deposit Scheme, 2019 with leniency due to pressing personal needs

In a significant ruling, the Orissa High Court has permitted Priyadarsini Das to prematurely withdraw her fixed deposits, recognizing marriage as a pressing necessity under Hindu Law. The judgment, delivered by Justice Dixit Krishna Shripad, revolves around Rule 8(d) of the National Savings Time Deposit Scheme, 2019, which allows premature withdrawal after four years, albeit at a reduced interest rate applicable to Post Office Savings Accounts.

The petitioner, Priyadarsini Das, sought the premature encashment of her fixed deposits to fund a family marriage, a need traditionally recognized under Hindu Law as one of the three necessities: aapaatkaale (emergency), vyaahaarike (business), and kutumbaarthe (family). The court acknowledged this necessity, emphasizing that the funds belonged to the petitioner, thereby entitling her to use them unless explicitly restricted by law.

The Union of India, represented by its counsel, argued that the rule does not permit premature encashment prior to the expiry of four years, with a five-year term being the norm for such deposits. However, the court found this interpretation difficult to accept, stating that Rule 8(d) does not impose a complete embargo on premature withdrawal. The rule specifically mentions that interest shall be payable at a reduced rate if withdrawal occurs after four years, indicating a lenient approach needed in interpretation.

Justice Shripad emphasized that subordinate legislation should be interpreted with leniency unless it explicitly prohibits an action, especially in cases involving pressing necessities like marriage. Consequently, the court quashed the impugned letter dated August 5, 2025, which denied the premature withdrawal, and issued a writ of mandamus directing the respondents to allow the petitioner to withdraw her deposits within two weeks. The court warned that any delay would result in interest charges at 1% per month, payable personally by the respondents.

This ruling underscores the court's recognition of individual financial autonomy and the importance of accommodating personal necessities within the framework of financial regulations. It sets a precedent for interpreting rules with flexibility in cases of genuine need, while balancing the interests of individuals and financial institutions.

Bottom Line:

Premature withdrawal of fixed deposits - Rule 8(d) of the National Savings Time Deposit Scheme, 2019, allows premature withdrawal after four years - Subordinate legislation needs to be interpreted with leniency unless it completely prohibits withdrawal. 

Statutory provision(s): National Savings Time Deposit Scheme, 2019

Priyadarsini Das v. Union of India, (Orissa) : Law Finder Doc Id # 2783407