The mandate and power attorney are the rights cast upon a third person to act on behalf of the principal person/s. The rights of mandate and power of attorney holders are very similar in the operation of bank accounts but they are issued for different reasons and purposes.
A mandate, is a simple letter of authority, signed by a constituent authorising the bank to permit a certain named person (agent) to operate the account on his/her behalf. A mandate to operate an account does not extend to overdrawing the account unless the mandate letter specifically provides the authority to overdraw the account. In the case of Joint accounts, all the depositors to the account must sign the mandate letter. In the case of partnership firms, all the partners of the firm must sign the mandate letter. One of the joint account holders or any partner of the firm as the case may be can revoke this authority by writing to the bank.In the case of H.U.F, the mandate must be signed by the Karta and all the major co-parceners. In case the mandate is to be issued in favour of a third party an Indemnity has to be executed by the Karta and major co-parceners of the H.U.F.