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Dhiraj Solanki   27 October 2023

Transmission of flat by giving public notice and missing legal heirs

The flat owner died overseas without any will and had no family, was single and unmarried. Elder brother of the deceased is a Nominee and also legal heir of the deceased. The nominee is unwilling/unable to disclose other legal heirs of the deceased and declares himself as the Sole legal heir because he does not have any information or whereabouts of any other legal heirs for the last 35 years, hence the nominee declares himself as the sole legal heir claiming 100% ownership of Flat, the nominee is also willing to sign any undertaking, declaration to confirm that he is the only legal heir.  

The Society is doubtful and asking for testamentary document to transfer ownership however the nominee is unable to produce it and contends that since he is the only legal heir and nominee there is therefore no need to produce any testamentary document and the Society should transfer the Flat on his name.  The nominee rightly points out that there are several Societies in Mumbai who have transferred the Flat to those nominees who are the Sole legal heirs. { For e.g. In the case of deceased parents, the Flat is being transferred to their ONE & ONLY SON through nomination. In such cases the Society never request testamentary document from Son because the Son is the only legal heir so why is the testamentary document being demanded from nominee when he is also the only legal heir }.

Therefore:

  • Can the Society transfer the Flat to nominee by issuing Public Notice in newspaper, Gazette.
  • Is the Society legally liable to search for missing legal heirs, does the onus rely on the Society to prove missing legal heirs . If yes how and what procedure needs to be followed by the Society for the same.
  • What options are available to Society to properly resolve this matter.  AND
  • Is there any remedy available to the nominee if the Society does not transfer the Flat to the nominee.
  • Can the Deputy Registrar issue order to the Society to transfer the Flat to nominee with 100% membership right.


Learning

 5 Replies

kavksatyanarayana (subregistrar/supdt.(retired))     27 October 2023

Society cannot afford to know who is the legal heir.  If any nominee/is said to be a legal heir should give documentary evidence to society.  The Registrar cannot give orders to transfer the flat to the nominee.  The nominee shall give paper public notice to file objections to transfer the property to him.

T. Kalaiselvan, Advocate (Advocate)     28 October 2023

Society cannot transfer the flat to the nominee if he is not the class I legal heir to the deceased owner.

The nominee should be adivsed to obtain succession certificate through court of law in the absence of any documentary evidence to prove that the nominee is the only legal hier. 

Society cannot transfer he flat to the nominee based on the newspaper publication.

Society cannot go behind the search of legal heirs.

It is the responsibility of the nominee to trace out other legal heirs and obtain NOC from them to get the flat transferred to his name.

Alternately since the nominee claims himself as the legal heir, he can approach court with a suit for declartion to declare him as the sole surviving legal heir of the deceased owner to succeed his estates.

Deputy registrar do not have power to declare the successors in interest to succeed to the property of the deceased.

 

 

 

Dr. J C Vashista (Advocate )     28 October 2023

Very well analysed, opined and advised by learned expert Mr. T Kalaiselvan.

1. The society has no power to transfer title of the flat to nominee, however, society is concerned with its share only, name of registered nominee has to be transferred as a "member" in the Membership Register.

Transfer of title of the properlty has to be declared by competent civil court of jurisdiction through a local prudent lawyer. 

2. The society is not concerned with other LRs of deceased member for which the nominee (substittuted member) has to obtain "Surviving Member Certificate" from area SDM for proving the fact in the declaratory suit. 

3. The society do not require any action to be taken to call for any other LR of deceased member since nominee is already registered in their record.

4. Yes, the only option available to nominee is already elaborated in response to question No. 1 hereinabove.

5. No,

Registrar Cooperative Soceities do not have jurisdiction qua title of the flat / any other movable or immovable property left behind by deceased member of the concerned society.

P. Venu (Advocate)     28 October 2023

This is a repeated query by the same author. The earlier query had been concluded with my suggestion on the following lines -

"It is the settled legal position that a nominee is a person who is chosen by an individual to take care of their assets and investments after they die. A legal heir is a person who is designated by law or by the individual's will to receive the property of another person after they die. A nominee is a custodian of the assets and not the owner. The nominee holds the assets until the legal heirs can claim them. The legal heir is the rightful owner of the deceased person's assets. The nominee is chosen by the individual, while the legal heir is designated by law or by the individual's Will. The nominee holds the property in trust for the legal heir, while the legal heir has actual ownership of the property. 

Sections 25, 25A and 30 of the Maharshtra Cooperative Societies Act, 1960 (it is MCS, not MSC,  Act)provides as follows -  

Section 25 - Cessation of membership:

A person shall cease to be a member of a society on his resignation from the membership thereof being accepted, or on the transfer of the whole of his share or interest in the society to another member, or on his death, or removal or expulsion from the society, or where a firm, company, any other corporate body, society or trust is a member, on its dissolution or ceasing to exist.

25A. Removal of names of members from membership register: 

The committee of a society shall remove from the register of its members the name of a person who has ceased to be a member or who stands disqualified by or under the provisions of this Act for being the member or continuing to be the member of a society : Provided that, if the society does not comply with the requirement of this section, the Registrar shall direct such society to remove the name of such person, and the society shall be bound to comply with such direction.

30. Transfer of interest on death of member:

(1) On the death of a member of a society, the society shall transfer the share or interest of the deceased member to a person or persons nominated in accordance with the rules or, if no person has been so nominated, to such person as may appear to the committee to be the heir or legal representative of the deceased member:

Provided that, such nominee, heir or legal representative, as the case may be, is duly admitted as a member of the society;

Provided further that, nothing in this sub section or in section 22 shall prevent a minor or person of unsound mind from acquiring by inheritance or otherwise, any share or interest of a deceased member in a society

(2) Notwithstanding anything contained in sub section (1), any such nominee, heir or legal representative, as the case may be, may require the society to pay to him the value of the share or interest of the deceased member, ascertained in accordance with the rules.

(3) A society may pay all other moneys due to the deceased member from the society to such nominee, heir or legal representative, as the case may be.

(4) All transfers and payments duly made by a society in accordance with the provisions of this section shall be valid and effectual against any demand made upon the society by any other person.

In my considered view, the provision as bove mandates that the nominee ought to admitted as regular member on the demise of the original member. Of course, he is only a trustee on behalf of the legal heirs and they have claim to membership, at their discretion.

In this context, the Apex Court has held in the case of Indrani Wahi vs.Registrar of Coop. Socieities -

19. Insofar as the instant aspect of the matter is concerned, there is no doubt in our mind, that even Rules 127 and 128 of the 1987 Rules, lead to the inference, that in case of a valid nomination, under Section 79 of the 1983 Act, `the Cooperative Society' is liable to transfer the share or interest of a member in the name of the nominee. We hold accordingly.

20. Having recorded the above conclusion, it is imperative for us to deal with the conclusion recorded in paragraph 6 (already extracted above) of the judgment of this Court in the Usha Ranjan Bhattacharjee case (supra). In this behalf, it is necessary to clarify that transfer of share or interest, based on a nomination under Section 79 in favour of the nominee, is with reference to the concerned Cooperative Society, and is binding on the said society. The Cooperative Society has no option whatsoever, except to transfer the membership in the name of the nominee, in consonance with Sections 79 and 80 of the 1983 Act (read with Rules 127 and 128 of the 1987 Rules). That, would have no relevance to the issue of title between the inheritors or successors to the property of  the deceased. Insofar as the present controversy is concerned, we therefore hereby direct `the Cooperative Society' to transfer the share or interest of the society in favour of the appellant – Indrani Wahi. It shall however, be open to the other members of the family (presently only the son of Biswa Ranjan Sengupta – Dhruba Jyoti Sengupta; we are informed that his mother – Parul Sengupta has died), to pursue his case of succession or inheritance, if he is so advised, in consonance with law. The decision above has been based on the provisions of the West Bengal Act. The ratio has been unequivocal in holding that the Society has no option but  to transfer the membership in the name , leaving it to the discretion of the legal heirs to pursue the claim based on succession or inheritance.

In the instant case, it appears that the Society is relying on the alleged provisions of Section 154B (18)(c) of the MCS Act (notified by  MAHARASHTRA ORDINANCE No. IX OF 2019 amednding the MCS Act) in denying regular membership -

(18) “Member” means a person joining in an application for the registration of a housing society which is subsequently registered, or a person duly admitted to Membership of a society after its registration and includes associate or joint or provisional Member ;

( a) “Associate Member” means husband, wife, father, mother, brother, sister, son, daughter, son-in-law, daughter-in-law, nephew, niece a person duly admitted to Membership of a housing society on written recommendation of a Member to exercise his rights and duties with his written prior consent and whose name does not stand in the share certificate ;

( b) “Joint Member” means a person joining in an application for the registration of a housing society jointly, which is subsequently registered or a person who is duly admitted to Membership after its registration and who holds share, right, title and interest in the flat jointly but whose name does not stand first in the share certificate ;

( c) “provisional Member” means a person who is duly admitted as a Member of a society temporarily after death of a Member on the basis of nomination till the admission of legal heir or heirs as the Member of the society in place of deceased Member ;

However, it could be seen the said provisions are not part of the statute as could be accessed on the official website of the Maharashtra Government (https://mahapanan.maharashtra.gov.in) and India Code (https://www.indiacode.nic.in).  The reasons are obvious. A statutory brought into force by means of an Ordinance, in terms of the provisions of Artice 213 of the Constitution,  is of limited life unless duly enacted as an Act of the Legislature -

213. Power of Governor to promulgate Ordinances during recess of Legislature.

(1) If at any time, except when the Legislative Assembly of a State is in session, or where there is a Legislative Council in a State, except when both Houses of the Legislature are in session, the Governor is satisfied that circumstances exist which render it necessary for him to take immediate action, he may promulgate such Ordinances as the circumstances appear to him to require:

Provided that the Governor shall not, without instructions from the President, promulgate any such Ordinance if-

(a) a Bill containing the same provisions would under this Constitution have required the previous sanction of the President for the introduction thereof into the Legislature; or

(b) he would have deemed it necessary to reserve a Bill containing the same provisions for the consideration of the President; or

(c) an Act of the Legislature of the State containing the same provisions would under this Constitution have been invalid unless, having been reserved for the consideration of the President, it had received the assent of the President.

(2) An Ordinance promulgated under this article shall have the same force and effect as an Act of the Legislature of the State assented to by the Governor, but every such Ordinance-

a) shall be laid before the Legislative Assembly of the State, or where there is a Legislative Council in the State, before both the Houses, and shall cease to operate at the expiration of six weeks from the reassembly of the Legislature, or if before the expiration of that period a resolution disapproving it is passed by the Legislative Assembly and agreed to by the Legislative Council, if any, upon the passing of the resolution or, as the case may be, on the resolution being agreed to by the Council; and

(b) may be withdrawn at any time by the Governor.

Explanation.- Where the Houses of the Legislature of a State having a Legislative Council are summoned to reassemble on different dates, the period of six weeks shall be reckoned from the later of those dates for the purposes of this clause. (3) If and so far as an Ordinance under this article makes any provision which would not be valid if enacted in an Act of the Legislature of the State assented to by the Governor, it shall be void:

Thus, Section 154 B is not there in the Statute Book; it has been rendered void in course of time. And, the the Society management is relying on void provision in continuing deceased person as the member and thus, denying you the membership. You may serve a legal notice on the Society and escalate the issue further through judicial proceddings, if so necessary."

Read more at: https://www.lawyersclubindia.com/forum/details.asp?mod_id=231517&offset=1

Dr. MPS RAMANI Ph.D.[Tech.] (Scientist/Engineer)     29 October 2023

The Society can and should transfer the flat to the nominee on an application from him.  If the Society refuses to take action on the appliction of the nominee, he can appeal to the Assistant Registrar of his Ward with copies of all documents submitted to the Society. The  Assistant Registrar will forward the appeal to the Society and ask what action they propose to take.  If the Society does not reply within the stipulated period or gives a negative reply, the Registrar will give his own orders based on merits and that would be binding on the Society. If a person is not admitted as member in place of a deceased member, who will pay the dues to the Society? The nominee pays the dues, fearing that he will lose his rights otherwise. That makes the Society drag its feet. I was secretary of our Soceity for decades and I never kept anything pending. My actions were always ultimately right   even when some members complained to the Registrar.


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