N.Dharmeshwaran (pensioner) 25 September 2010

Nominee Vs Heir

Mumbai High Court is said to have "differentiated

from the Supreme Court(Can it/) holding that

a Nominee under s109A of the Companies

Act supplants a Heir under the Will.

Is this not repugnant in that Will is dealt

with under a specific Act pertaining to

property and its passing on while the

detailing a nominee is an inciddntal

provision of the Companies Act.

Under the provision of Nominee

should that not be preceded by

a"unless this is repugnant to

subject or context"

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2 Replies

V. VASUDEVAN (LEGAL COUNSEL) 25 September 2010

Mr. Dharmeshwaran, The status of a nominee for property, shares and insurance, etc.., are very clear and the Supreme Court and the Bombay High Court has no different view.

- When a person is nominated for the property/shares/insurance or any such benefit, the society, company and insurance company is bound to recognize the nomination and distribute the proceeds/property to the nominee. If they do so, they stand discharged against any claim by a third party or legal heir.

The nominee in fact is the representative/trustee of the property in question and does not get the property absolutely to himself. The nominee is responsible and obliged to distribute the share of property to all the legal heirs/legatees, as per the will of the deceased.