regarding nomination

Proprietor

From the above deliberation of the learned Experts, it is observed that in the given situation as per prevalent law , the nominee will be the rightful receipent of all dues payable to a deceased employee irrespective of the real life condition. So, Govt. should insert a condition in the Nomination form that if the marital status of an employee undergoesany change during the course of employment , it is imperative upon the employee to effect necessary changes in the nomination recorded with his employer within a week of such change to rationalise the situation.

 
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Patnaik Jee, I will give you a scenario. Parents are just a middle class with some assets. They got their Son educated with a lot of difficulties and taking loans including a loan from the bank for which their house is under the mortgage. The Son got a good job with very good salary. Father is the only earning member, his retirement and Son getting job almost coincided. Son got married to his colleague after working in the job for about 5-6 years. The Daughter in Law is having an equal salary and her parents are well off and belong to the upper-middle-class category.    Poor fellow son died in an accident just a few months from marriage. According to your suggestion, what shall happen?

 

Under no circumstances, I am trying to argue that once the nominee gets the money ( in the instant case where the forum was asked to respond) he should dupe the other natural claimants. It is expected under the Nomination I repeat, that the Nominee acts like a Trustee. And when there is a dispute and one of the other claimants objects for the money to be given to Nominee, the Nomination has come to an end. What the Government thought that without much hassle one of the family members get the money(without entangling themselves in paperwork to get this paper, that paper, that Certificate, that declaration etc) and such family member (Nominee) shall be good enough to act as a Trustee to that money and shall not try to benefit himself only. If the nomination is not contested, the payment goes through and if it is contested, the nomination is no longer valid.

 

If I remember correctly only in the case of a person without any family at the time of giving nomination, such a person can give his nomination in favor of any person he/she likes. However, once he/she gets married, such nomination shall forthwith become invalid.  And such Employee should give nomination in favor of his family. In all other cases, the last nomination stands irrespective of the fact whether the person got married after giving nomination.

Arguments can be made both ways whether the nomination can be changed and decided in favor of the weakest among the claimants when there is counterclaims. But who decides! The Employer?  Banks? Impossible. 

Can anybody give some law contrary to our Indian Law on Nomination is prevalent anywhere in the world?

 
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Retired employee.

The nomination is not final, there is a separate prescribed form for changing the name of a nominee, and any number of times nomination can be made..  Only in the case of post office, first time I have seen that nominee has to give percentages and names of nominees for distribution.  In Banks, a nomination is permitted only in one name, and by making prescribed application previous nominee name can be canceled and fresh nominee's name can be recorded.

 
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That's Okay Prasad Garu. In the instant case, there is one Nomination and there is a claim against the estate from Wife who is not Nominee.

  1. What the Employer should do now
  2. Or the Nominee should do
  3. Or the Wife should do

Are the questions within the ambit of the existing law, without mixing the issue with some reformist thinking.

 
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Retired employee.

Sir,

The law makers considered all this, and  the change of nomination enables for such changes in future, it is left to the concerned to change the nomination as he likes.  People has to get awareness on such stipulations and the nomination was there in LIC since it's inception.  The problems may be in 1% alone, and in case of employees, it is deemed that his benefits are self acquired, and he can nominate any one as he likes and it need not be only wife or his legal heirs alone.  There is no law that sates that self acquired property should go to wife alone. A nomination has to be treated as a will.

 
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Yes Sir Prasad Jee, well said.

 
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There is a subtle difference between a Will and Nomination. If any person gets money/property/shares/gold etc, it is his for keeping and enjoying. He/she need not share it with anybody by any legal provision. However, if any person receives anything under nomination, he is only a Trustee and he cannot enjoy the entire amount but has to distribute to all the claimants, including him/herself as per the family law applicable to them. Nomination cannot be given to other than family members, excepting by a person who has no family(in which case, nomination comes to an end once such person starts a family by marrying) while by Will anybody can be the beneficiary.

 
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Advocate

The entire discussion on the nomination made by the deceased in favor of his father before hismarriage has been done wothout reference to the relevant act and Rules. The Employees Pf Scheme 1952, Rule 61 makes it mandatory that the nomination should be only in favor of a memebr of the family of the employee memeber.Proviso to sub rule 3 makes it clear that any nomination made before marriage shall be invalid. Hence in the instant case the father who has been nominated fdby the deceased employee before hismarriage shall not be taken in ot account as it has become invalid after marriage. Hence the father's c;aim should be ignored and the calim made by the wife ofthe deceased should be favoroubly considered by the authorities concerned.


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Guptajee, here is the reproduction of the relevant portion of the act:

61. Nomination (1) Each member shall make in his declaration in Form 2, a nomination conferring the right to receive the amount that may stand to his credit in the Fund in the event of his death before the amount standing to his credit has become payable, or where the amount has become payable, before payment has been made.

(2) A member may in his nomination distribute the amount that may stand to his credit in the Fund amongst his nominees at his discretion.

(3) If a member has a family at the time of making a nomination, the nomination shall be in favour of one or more persons belonging to his family. Any nomination made by such member in favour of a person not belonging to his family shall be invalid. Provided that a fresh nomination shall be made by the member on his marriage and any nomination made before such marriage shall be deemed to be invalid.

(4) If at the time of making a nomination the member has no family, the nomination may be in favour of any person or persons but if the member subsequently acquires a family, such nomination shall forthwith be deemed to be invalid and the member shall make a fresh nomination in favour of one or more persons belonging to his family.

I am of the view that Rule 3 is relating to those who nominate a person other than the family which ab initio invalid and who has to make a fresh nomination after marriage.

 

If what I view is not correct, there is no need to add Rule 4.

 

Kindly clarify.

 
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Retired employee.

To summarize any nomination within the family is always valid if not canceled, Dependent parents are always within the family. and after marriage, the earlier nomination within family members, irrespective of the marriage prevails if not canceled.  (That nomination in favour of others(Only when such family member is not there) after marriage comes to an end with marriage as spouse steps into as family member)

 
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