TS, AP back out on freezing accounts!

Days after the banks froze the accounts of common institutions between both the Telugu States to avoid misuse, chief secretaries of both the states wrote a joint letter to banks not to freeze current accounts and release money whenever required.

Telangana insisted on freezing the accounts but now dropped the idea since freezing of the current accounts makes it difficult to pay salaries to those employees in the institutions. However they did not take any stance regarding the defreezing of the Fixed Deposit Accounts of such institution as they do not cause any problems now.

It may be reminded to our readers that this issue flared up after a senior official of Labour department transferred Rs 400 crore from the fixed deposit account of the labour department by AP from a city branch of Andhra Bank to a branch of the same bank in Vijayawada. AP and Telangana gave mutually contradicting instructions to bankers over the fund transfers. So banks have decided to freeze the account until the institutions are divided between the states.