legal heir certificate
nagarajupatro
(Querist) 22 May 2011
This query is : Resolved
sir
Its a case of andhra pradesh. a women made short term deposit appointed her daughter and her sisters daughter as nominees. NOw they want to draw the deposit amount from bank. She had no other legal heirs except these two. Bankers demanding legal heir certificate. HOw it can b obtained pls code the procedure and where from it is to be obtained.
R.Ramachandran
(Expert) 22 May 2011
Please indicate the woman in question is alive or not?
M/s. Y-not legal services
(Expert) 22 May 2011
Yes. Mr.ramachandran's question is correct. Then the nominee need not to be the legal heir only.. Any one can be appointed as nominee.. That nominee person should be prove that she or he is that particular person who is appointed as nominee.. Thats enough.
Guest
(Expert) 22 May 2011
the nominee can give his certificates like the education and the resident proof and the voter card etc in his/ her name
A V Vishal
(Expert) 22 May 2011
The nominees have to approach the administrator general office situated at the High Court of A.P, to btain the certificate to withdraw the amount. However there is a monetary limit of Rs.2.00 lakhs for the purpose of jurisdiction.
M/s. Y-not legal services
(Expert) 22 May 2011
Where its mentioned like this mr.vishal. This is new thing, first time am hearing this.. And my question if my father appoint me as his nominee for his bank saving account. And he left just 5000 rupees with his account mean, after my father, if i want to get back that amount mean for this petti issue also i have to follow the proceedings as per your words?
A V Vishal
(Expert) 23 May 2011
Mr Tom
Refer the Administrator General Act to know more.
Advocate. Arunagiri
(Expert) 23 May 2011
Mr.Vishal,
I think when there is no nominee is appointed the procedure as suggested by you has to be adopted. Please correct me if I am wrong.
When the nominee is appointed, the nominee has to produce the death certificate and ID proof to the bank and can with draw the amount. I have handled a matter. On the death of the account holder the money was paid to his servant maid based on the death certificate, ID proof and a letter from me.
A V Vishal
(Expert) 23 May 2011
The banks have peculiar rules governing operation/closure of deceased account holders. Now a days due to large scale litigations on account of such payments to nominees, the banks are insisting production of LH certificate, obviously as you are aware that the role of a nominee is merely that of a trustee, however, in most of the cases the trust is breached thereby putting the legal heirs to problems. Hence even in case the deceased has nominated a nominee a LH certificate is always advisable. Further, due to stoppage of issue of LH certificate by the government now the heirs are left with no option but to approach the court for a proper succession certificate.
Guest
(Expert) 23 May 2011
Mr. Vishal,
Your observation is not correct about the nominee as merely a trustee of the deceased. Rather bank is a trustee of the account holder for that particular sum it holds along with any profit earned on that and has to discharge its liability on the death of the account holder according to the wishes of the disease. Nomination is not merely a fun or fake formality that can be refused to be adhered at the discretion of the banker.
In fact nomination is a sort of a will of the account holder in favour of a particular person, as made during his/her life time particularly for the amount and interest accrued on that amount. On existence of nomination, bank does not hold any right to ask for heirship certificate. At the most it can get the identity of the claimants confirmed by the witnesses known to the bank or if the amount is high, the bank can ask for indemnity bond as a precaution to cope with the situation if any one raises any dispute for that amount at some later stage.
Suppose, some one other than a nominee produces legal heirship certificate, will the bank honour that by ignoring the nomination, unless there is a specific mention to ignore any nomination in making payment to the legal heir. If the bank pays the amount to anyone else other than the nominee, the nominee would thereafter drag the bank to the court of law for not adhering to the wishes of the account holder.
Rather, if some one produces a legal heir certificate to claim the amount of the account from the bank, it becomes the moral duty of the bank to contest that legally, as a trustee of the account holder. Any legal heir, if he/she thinks to have some right on that amount, can claim only from the nominee, mutually or through court of law, but not from the bank.
However, if you still think that the role of nominee is just like a trustee, you may like to quote any provision of the law or the judgment of any court for our guidance.
A V Vishal
(Expert) 23 May 2011
Most people in India believe that nominee is rightful person to receive and keep money. But the position in law is otherwise. An attempt has been made to explain the law of nomination under various Acts/ Schemes such as: Insurance Act, 1938, Employees Provident Fund Scheme, 1952. Payment of Gratuity Act, 1972, Public Provident Fund Act, Companies Act 1956 and Rules, laws concerning DDA / Societies flats, etc.
Nomination under the Insurance Act 1938
A nominee is the person named in the proposal form to whom the Insurer (LIC /GIC) pays the assured sum in case of death of the assured.
Nominees is a trustee who receives the money due under the policy for the benefit of the legal heirs of the deceased. In other words, the fact that a person happens to be mentioned as nominee by the person insured, does not give him the TITLE to the insurance money.
The position of the nominee was finally settled by the Supreme Court in the case of Sarbati Devi Vs. Usha Devi (AIR 1984, SC-346). In this case, a person insured his life and appointed his wife Usha Devi as nominee to receive the sum assured on his death. Sometimes later he dies, leaving behind his wife, son Ashok Kumar and mother Sarbati Devi as his nearest legal heirs. On the strength of the nomination, Usha Devi claimed absolute right to the sum assured to the exclusion of the other two heirs i.e. the son and the mother of the deceased. The Supreme Court dismissed her claim holding “a mere nomination made under Section 39 does not confer on the nominee any beneficial interest in the amount payable under the life insurance policies on the death of the insured.” The Court further observed that the nomination only indicates the hand, which is authorized to receive the amount. The amount, however, can be claimed by the heirs of the assured in accordance with the Law of succession governing them.
Nomination and Labour Welfare Laws Para 61 of the employees Provident Fund Scheme, 1952 and Section 6 of the Payment of gratuity Act, 1972 deal with the procedure for nomination to the respective funds. The right of nomination is restricted, i.e. in the case of an employee having no family, the nomination can be made in favour of any person. However, as soon as there is a member in the family, the nomination in favour of an outsider becomes void and fresh nomination in favour of any member of the family has to be made. Also it is pertinent to note that while an employee has family, nomination in favour of an outsider (including Mother, Sister and Brother) is void.
Public Provident Fund Act, 1968 Section 8 of the Act says that all amount standing in the credit shall go to nominee (whether a member of family or not). Where there is no nomination, the amount shall be payable to his legal heirs. It is advisable to nominate wife as nominee in PPF Account in case one is married. In case account has been opened before marriage, nomination to be changed in favour of wife as and when one gets married.
Nomination and the Societies Flats The legal position of a nominee remains the same under the property law. After Sarbati Devi’s case (AIR 1984 SC -346) the law is clear on the principle that the nominee is a mere trustee with whom the Society can initially or prima facie deal. And after the death of a member, all the heirs of whom a share in the said Society has been bequeathed, will have the right to succession to the property and the nominee cannot exclude the heirs. If Society rules permit, make wife as co-allottee and – or nominee in the Society flats and make and register the Will in spouse’s favour. DDA LdDO/MCD/Municipalities insist for Registered Will for mutation.
Law on Transfer of Shares on Demise A ‘nominee’ under the Companies Act, 1956 as amended, has all the rights of ownership. Accordingly, it is necessary that wife should be made a nominee (Section 109A) in all shares, bonds, debentures, etc.
Following conclusion can be drawn from above discussion:
1. Nominate the spouse as Nominee in all documents and make and register Will making the spouse as beneficiary. However, this is subject to the relationship between the spouse.
2. Nomination does not affect the title to the money secured by policy – schemes, fund or property. It only provides a mode of payment in particular person who is the nominee.
3. In spite of such a nomination, the policy holder or owner of the fund or the property retains complete power of disposition which he can exercise either by transfer or assignment which operates during his lifetime or by a REGISTERED WILL which operates only subsequent to his death.
4. The rightful claimants to the sum under a policy or scheme or the share in the property as the case may, are the LEGAL HEIRS OF THE DECEASED, AND NOT THE NOMINEES.
5. In order that the amount under the policy or the welfare schemes or a share in the society or flat falls due to the desired person (spouse), it is necessary to bequeath it by way of REGISTERED WILL. A WILL alone puts into effect the wishes to the testator after his death.
6. Nominate your spouse or any other person whom you wish to give shares / debentures, etc.
7. Making WILL is a simple affair. However, it requires will / desire to make a WILL which is lacking in most people.
