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POSTED BY ON November 28, 2013 11:23 am COMMENTS (3)
Recently my brother in law, aged 58 yrs, working in a central govt. department has died and is being survived by his wife (issueless), mother (getting family pension of her husband), one brother and a sister. It has been now found that deceased has nominated:
1. his mother and his wife jointly for terminal payments ( PF, Gratuity, Pension etc.)
2. his mother in Life Insurance Policies
3. his mother in Demat a/c for equity shares investments
4. his mother in various bank accounts
5. his mother in mutual fund investments
The deceased, who made no will, has willfully tried to deprive his wife (sole legal heir in this case) of his assets by nominating his mother. What are the remedies left for the widowed wife for getting her legal due?
Narinder Sharma
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Dear Narinder, please read my reply in addition to dear bemoneyaware. Demat is solely meant for nominee. For all other assets, the Hindu sccuession act (if you are Hindu, Sikh, Jain, Buddhist) ‘ll be applied in absence of a WILL. Mother and Wife, both being class 1 heir are eligible for equal share in all assets other than Demat. Family pension ‘ll be solely for Wife.
Thanks
Ashal
(I am not a lawyer. It is always better to get a lawyers advice)
Nominee is just custodian to ease the process. Nominee doesn’t get any legal right to keep the money. If the nominee is not a heir, the nominee is supposed to distribute the proceeding among heirs. If the nominee is a legal heir, the nominee get only their share of the proceedings.
Also to my understanding, Mother is also a legal heir in the absence of a will.
Sad to hear about your brother in law. My condolences to your family.
Coming to your question:
Nomination is the process of appointing a person to take care of your assets in the event of your death. For all investments except company bonds and equity, nomination does not provide ownership of your assets. The nominee will only be the custodian of the asset till it is given to its beneficiary.
Though a nominee is an important person, he or she has no rights over the money or assets unless that is specified under the will or the nominee happens to inherit the money. So as such a nominee is a mere custodian of the assets. (S)He is a contact point for the investments. So in the event of a person’s death, a bank/mutual fund could get in touch with the nominee for further instructions to act on the account. At the time of claiming the savings, the nominee will have to give a proof of his identity to the relevant authority.
So other than Demat a/c for equity shares investments the nomination does not mean that mother gets the entire money
Did he leave a will? If not division of assets will be as per the religion of the deceased. For details on nomination or will you can refer to bemoneyaware Right Paper Work For Those You Love: Part 1