Succession certificate in case of huf karta"s death
Goapl Garg
(Querist) 24 September 2014
This query is : Resolved
An HUF where the Karta was only male and it has wife and two major daughter as member/coparceners.The Karta has expired.The HUF has a Bank account with the demised karta as signatory.Now the Bank is asking for "Succession Certificate" and says it will distribute the credit amount among three ladies equally on receipt of succession certificate.However my Income Tax Practioner has opined that the HUF never dies and it shall continue to exist with a different Karta(choosen by the remaining three members) and there is no need and also provision for Issue of a :Succession Certificate" in case of HUF as it is a Constituted Body whereas the Sucession Certificate is issued in case of death of an individual without will.
Money is held up. Please give opinion for right step.
Kumar Doab
(Expert) 24 September 2014
It is felt that he has left female heirs only and bank might have taken it as notional partition since eldest male child is not available.
Signature of Karta are required for every transaction and has sole authority over the a/c.
Wait for advise of experts.
Goapl Garg
(Querist) 25 September 2014
Dear Experts,
Kindly advise in the Matter please...
Regards
Dr J C Vashista
(Expert) 26 September 2014
Bank is right, you will have to obtain sucession certificate from the court and submit the same to Bank for operation of the account.
T. Kalaiselvan, Advocate
(Expert) 01 October 2014
In my opinion your IT Practitioner is right. The HUF is a constituted body, thus upon the death of Kartha, the remaining members may pass a resolution and appoint a person as Kartha and communicate the same to the Bankers with a cop of the death certificate of the previous Kartha and resolution copy. Hope this may take care of other needs, if the bankers still refuse, you may approach the higher officials of the bank for relief.
It was held in C.P. Berai v. Laxmi Narayan AIR 1949 Nag 128 case that:
It was held that a widow could be a karta in the absence of adult male members in the family. It was said that the true test is not who transferred/incurred the liability, but whether the transaction was justified by necessity.
According to Dharmashastras, in absence of male members female members can act as karta, or in case where male members if present are minors, she can act as karta. Debts incurred even by female members under such circumstances will be binding upon the family and must be paid out of the joint family funds whether at the time of partition or earlier. Often the question is raised as to whether her acts are for the benefit of the family. Dharmashastra answers it by saying that she might act as manager by doing acts of positive benefit and not merely conservative/negative acts.
