Understanding the Concept of a Nominee under the ambit of Will

By

Sakshi Shairwal

Pubali Chatterjee

Abstract:

A Will is a legal pronouncement in which the person who makes it, announces the condition and the state of his property, belongings, and money after his death. The will itself can be proven to be a beneficial document that makes the transfer and takeover of property and other possessions following the pronouncer's death more transparent, pellucid, and simple to handle. The author of this article aims to highlight the concept of a will in light of the activities of the will's nominee.

INTRODUCTION:

A Will, also known as a testament, is a legal document in which a person, known as the Testator, appoints one or more executors to administer his or her estate and prepare for the transfer of his or her property after his death. In India, anybody over the age of 21 can make a will.

However, the will can only be written for self-acquired property, not for ancestral property. Future properties that accrue to the Testator after the execution of the Will can also be bequeathed. The Testator's Will takes effect after his death and may only be rescinded during his lifetime. A word of caution, however: the Testator cannot give his wealth to a charity and so deprive his family of their inheritance without providing extremely good grounds for such disinheritance that would hold up to legal scrutiny.

The reason as to why a will is entailed:

i.) A well-drafted Will helps to minimize family feuds over the testator's property, and if a feud does develop, the estate beneficiary has a powerful document on his side.

ii.) The law of inheritance does not take into account whether the dead wanted or did not want any of his family members to receive his property and in what percentage, but the Testator can partition the property according to his wishes through a Will.

iii.) It has been observed that the deceased possessed both immovable and movable possessions that his inheritors were unaware of; nevertheless, a Will guarantees that all types of property are divided equitably by the Testator during his lifetime.

iv.) It is currently a common legal requirement for transferring real estate, bank accounts, stocks and shares, and company interests. The legal requirements are satisfied with a well-drafted and registered will.

v.) After the Testator's death, the Will guarantees that there be no fraudulent claims.

NOTION OF NOMINATION UNDER WILL:

The Indian judiciary has been faced with the difficult question of whether the legal successor or nominee has the legitimate ownership of assets (including shares/securities, properties, and so on). Because of the ambiguity surrounding this legal issue, nominees and legal heirs have been forced to approach the courts, which has resulted in the legal principle that nominees only hold assets on behalf of the deceased's legal heirs, and that mere nomination of shares does not imply beneficial ownership of an asset.

A nominee is a trustee, not the owner of the assets, according to the law. To put it another way, a nominee is only a steward of your assets.

The nominee will only act as a trustee for your money/assets and will be legally obligated to pass it to your rightful heirs. The nominee is then responsible for holding the proceeds in trust until the legal successor is able to collect the funds. The person named in the will is considered a lawful heir.

For example, if a man makes a will during his lifetime and names his wife and children as legal heirs, his wife and children are the legal owners of his assets after his death. It is critical that a will be carried out. It replaces the succession law as the ultimate source of truth. One of the legal heirs can also be the nominee.

THE DIFFERENCE BETWEEN NOMINEE IN WILL AND NOMINEE IN LIC

Upon the death of the investors, the Nominees receive the investment money and assets. The FD nominee, on the other hand, is just a trustee with the authority to handle assets on behalf of the legal heir. The legal heir, on the other hand, is entitled to the deceased's assets under the laws of succession.

CASE REFERENCE

In the case of Ramdas Shivram Sattur v. Rameshchandra and Others, the Hon'ble Bombay High Court, in determining the legality of the nominee, held that Section 30 of the Act, which provides for the transfer of interest on the death of a member, does not establish any special rule of succession that differs from the rule of succession established under personal law. It went on to say that the role of a validly appointed nominee in dealing with the society is only to represent the legal heirs of the deceased member and that no interest in the property is created in favor of the nominee to the exclusion of those who are legally entitled to the deceased member's estate. The Hon'ble Bombardier shared this viewpoint.

IMPORTANT CONTENTIONS ABOUT NOMINEES IN A WILL

As per law, a nominee is a trustee and not the proprietor of the resources. He is just a watchman of your resources. The nominee will just hold your resource as a trustee and will lawfully undoubtedly move it to the legal heirs. A legitimate beneficiary is qualified for the resources of the perished. A legal heirs will be the person who is referenced in the will. Nonetheless, in the event that a will isn't made, the legal heirs of the resources are concluded by the progression laws, where the design is predefined on who gets how a lot. The candidate, thusly, should hold the returns in trust and the legitimate beneficiary can guarantee the cash. A legitimate beneficiary will be the person who is referenced in the will. assuming a will isn't accessible or composed, the legal heirs f of the resources are concluded by the progression laws, where the design is predefined on who gets how a lot.

On an exhaustive comprehension of lawful perspectives consistently and the circumstance of law on this point now, it might be settled that the Legal recipient is a conclusive, legitimate proprietor of the resources of a perished individual {either through intestate or testamentary succession}; A person who is named Nominee of the resources of the expired will get and hold the resources of the expired immediately upon the demise of the individual.

The advantages of the legitimate beneficiary to the wealth are indefeasible. Generally, the authentic recipients of an expired who is hitched are friends, young people, and gatekeepers, while, in the case of an unmarried perished individual, their folks and kinfolk would be an extremely legitimate beneficiary.

In the year 2016, the Bombay High Court let go of the situation of a nominee versus legal heirs with the portions of an Indian organization. The Court held that an assignment doesn't abrogate the laws of succession in India. A designation is made to guarantee that the home of the perished is ensured until such time the legitimate delegates of the expired can make fitting strides towards prevailing in such domain. In this way, the Nominee of portions of an Indian organization isn't the lawful proprietor of the offers, and subsequently, the legal heirs of the expired investor would have a legitimate case over such offers.

LEGAL CONNOTATION ABOUT NOMINEE

In a legal sense, a nomination is simply a clause that allows the Nominee to claim the property as a "custodian" in the event that the property's owner dies. However, there are a few essential points to keep in mind in this situation:

i.) Only in the event of the property owner's death may the Nominee claim the property.

ii.) He or she will only be the trustee/ custodian for a limited time, until the legal successor to the property/ estate is established, as per the Succession Act (or Will)

iii.) Following that, the nominee will transfer the property/estate to the lawful heir/heirs in accordance with the law.

iv.) The nominee and legal heir are two separate people; the nominee may be the legal heir if he or she has been nominated for assets or riches, and his or her name is also clearly specified as the legal heir in the will.

v.) Minor children may have guardian nominees who will be responsible for looking after their welfare and securing their portion of the deceased's fortune. In certain situations, a family trust or private trust can be established for the benefit of children and legal successors.

CONCLUSION

Thus nomination is not a will.

When there is a nomination already filed with the Society, the normal impression is that the Nominee on the death of the Member automatically becomes a member by filing an application. However, The Supreme Court of India has ruled in 1984 that “a Nominee is a mere Trustee with whom society can initially deal with after the death of a member. All the legal heirs of the deceased Member have a right of succession to the property of the deceased member and a Nominee cannot exclude the other legal heirs”.Thus the nominee merely acts as the trustee. In some instances, the nominee and the beneficiary of the will is the same person. At all times, the provisions of the Will prevail over the nomination. It is advisable to have the same person as the nominee and the beneficiary of the Will, so as to prevent future disputes. A nomination, in order to be effective, need not be executed as a will but must be in accordance with the formalities required by the particular provision applicable.

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