Nomination and Will... Know the difference...
The Nomination & WILL, two important, but often misconstrued and misunderstood subjects. Let’s try to understand it in brief.
Nomination : Recently, Hon'ble Apex court in the case of Shreya Vidyarthi V/s. Ashok Vidyarthi, AIR 2016 SC 139, has reiterated the legal position that :
a) Nomination is just a trusteeship & it's not a 3rd mode of Succession.
b) The Nominee does not become the owner of the property by virtue of Nomination. It does not take away rights of other legal heirs, may it be Society Share certificate or Bank Accounts or Shares.
Recently the Bombay High Court also in the case of Jayanand Jayant Salgaonkar V/s. Jayashree Jayant Salgaonkar has held that a nominee of shares and securities of a company merely holds the securities in trust, and as a fiduciary on behalf of any claimants under the laws of succession.
c) It relied on the celebrated judgment of Apex Court in the case of Sharbati Devi V/s. Smt. Usha Devi, 1984 AIR SC 346, wherein while dealing with the question of entitlement of Insurance Claim amount, it has been observed that, " The nomination only indicates the hand which is authorised to receive the amount, on the payment of which the insurer gets a valid discharge of its liability under the policy. The amount, however, can be claimed by the heirs of the assured in accordance with the law of succession governing them."
Nomination : Recently, Hon'ble Apex court in the case of Shreya Vidyarthi V/s. Ashok Vidyarthi, AIR 2016 SC 139, has reiterated the legal position that :
a) Nomination is just a trusteeship & it's not a 3rd mode of Succession.
b) The Nominee does not become the owner of the property by virtue of Nomination. It does not take away rights of other legal heirs, may it be Society Share certificate or Bank Accounts or Shares.
Recently the Bombay High Court also in the case of Jayanand Jayant Salgaonkar V/s. Jayashree Jayant Salgaonkar has held that a nominee of shares and securities of a company merely holds the securities in trust, and as a fiduciary on behalf of any claimants under the laws of succession.
c) It relied on the celebrated judgment of Apex Court in the case of Sharbati Devi V/s. Smt. Usha Devi, 1984 AIR SC 346, wherein while dealing with the question of entitlement of Insurance Claim amount, it has been observed that, " The nomination only indicates the hand which is authorised to receive the amount, on the payment of which the insurer gets a valid discharge of its liability under the policy. The amount, however, can be claimed by the heirs of the assured in accordance with the law of succession governing them."
Society and Nomination :
Perhpas the first celebrated Judgement on this point is of Hon. Bombay High Court, in the case of Ghatnekar V/s. Ghatnekar. AIR 1982 Bom 482.
In this case it was observed by the Court that even if nomination is made in favour of one of the legal heirs, it does not take away right of other legal heirs, as nomination cannot prevail over law of succession. In the instant case thier Lordship reiterated the principle of Dual ownership recognised in India. That means land owner and super structure can be owned by two different persons, which is not the case in England, where landowner is the owner of super structure too.
Indrani Wahi judgement : That has made the job of Societies very easy.
( Indrani Wahi v/s. Registrar of Co.Op. Societies. 2016(6) SCC 440.)
Then came the important, but often misquoted Judgement of Hon.. Supreme Court, on Social Media. By this judgement, I would say job of the society has become very easy. Society just has to transfer the share in the name of Nominee, as per it's record. It does not affect the right of other legal heirs and they may apporach competent court for deciding amongst themselves. It is totally out of preview of the Society to decide who is legal heir.
WILL : “Death is certain but its time is most uncertain” and therefore WILL is required to be made.
a) Any adult and sane person can make his/her WILL in respect of SELF ACQUIRED or SEPRATE property (All Movable like Shares, Ornaments, Bank FDs etc & all Immovable properties like Flat, Shop, Plot etc). As per Sec.30 of Hindu Succession act, a Will can be made in respect of his/her undivided share in the property.
b) Except Muslims, all other persons have to make the WILL in writing. There is no prescribed format though, it’s advisable that language of WILL should be simple and clear and complications should be avoided.
c) A Will does not require any Stamp nor it is compulsorily required to be registered. Only thing that is important is it should be signed by two witnesses (who are not beneficiaries of the WILL) and the Testator should sign in presence of two witnesses. Though by law A Doctor Certificate is not required, still practically it is in the interest of everyone to have such certificate regarding mental & physical health of the Testator.
d) Will starts speaking, when the maker of the Will stops speaking. So the beneficiaries are entitled to bequest only after death of the Testator. The WILL once made can be changed / replaced by another WILL, and it’s the LAST WILL THAT PREVAILS.
e) One may appoint one or more Executors for giving Effect to the WILL. In absence of Executor, beneficiaries may require to obtain Letters of Administration from Competent Court. PROBATE of the WILL is required to obtained only in Metropolitan Cities like Mumbai, Chennai & Kolkatta.
d) In our society, WILL or even its discussion is considered like a Taboo. Come on, it is in your interest that after you, there will be no or lesser conflicts regarding your property ones you make a Will.
Take care. God is great 🙏
Thanks & Regards
Adv. Rohit Erande.
Pune.©
WILL : “Death is certain but its time is most uncertain” and therefore WILL is required to be made.
a) Any adult and sane person can make his/her WILL in respect of SELF ACQUIRED or SEPRATE property (All Movable like Shares, Ornaments, Bank FDs etc & all Immovable properties like Flat, Shop, Plot etc). As per Sec.30 of Hindu Succession act, a Will can be made in respect of his/her undivided share in the property.
b) Except Muslims, all other persons have to make the WILL in writing. There is no prescribed format though, it’s advisable that language of WILL should be simple and clear and complications should be avoided.
c) A Will does not require any Stamp nor it is compulsorily required to be registered. Only thing that is important is it should be signed by two witnesses (who are not beneficiaries of the WILL) and the Testator should sign in presence of two witnesses. Though by law A Doctor Certificate is not required, still practically it is in the interest of everyone to have such certificate regarding mental & physical health of the Testator.
d) Will starts speaking, when the maker of the Will stops speaking. So the beneficiaries are entitled to bequest only after death of the Testator. The WILL once made can be changed / replaced by another WILL, and it’s the LAST WILL THAT PREVAILS.
e) One may appoint one or more Executors for giving Effect to the WILL. In absence of Executor, beneficiaries may require to obtain Letters of Administration from Competent Court. PROBATE of the WILL is required to obtained only in Metropolitan Cities like Mumbai, Chennai & Kolkatta.
d) In our society, WILL or even its discussion is considered like a Taboo. Come on, it is in your interest that after you, there will be no or lesser conflicts regarding your property ones you make a Will.
Take care. God is great 🙏
Thanks & Regards
Adv. Rohit Erande.
Pune.©
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