Succession certificate: LAW, Jurisidction of Courts &
EFFECT
If a person dies intestate,
leaving behind moveable properties such as fixed deposits, shares, debentures
etc then the class 1 legal heirs shall have to obtain succession certificate
from the competent courts of law in order to lay claim on such movables left
over by the deceased. It is also imperative that such class I legal heirs also
obtain Surviving Members certificate (SMC) from the appropriate SDM office
before preferring claim for succession in appropriate courts of jurisdiction.
The same shall be necessary, in as much as, before hand if the SMC is available
processing of succession case before courts are facilitated. The succession
certificate shall also be needed, in case, the nominee is named in any such
deposits. It is so, because, nominee gets the deposit only as a trustee of
legal heirs and the bank or such agency is discharged, once, the money is
transmitted to the nominee of deceased. However, the claim of legal heirs of
deceased could emanate after issuance of succession certificate. The necessary
enactment, in this context is Indian Succession Act 1925.
The succession certificate shall
be necessary for class 1 legal heirs of deceased, irrespective of declaring
nominee. Another dimension to it is, where and in what forum, the case for
seeking succession certificate could be filed and yet again, a deceased may
have accounts and deposits in several locations or states, thus, what should be
the appropriate forum and location, where such petition could be preferred?
Before going further, Section 371
of Indian Succession Act may be reproduced as under:
“371. Courts having
jurisdiction to grant certificate:- The District judge within whose
jurisdiction the deceased ordinarily resided at the time of his death, or, if
at that time he had no fixed place of residence. The District Judge, within
whose jurisdiction any part of the property of the deceased may be found, may
grant a certificate under this Part.”
In this context, a recent
judgment of Delhi High Court captioned as PJ Pothen & Anr Vs Sanghmitra (CGHS)
Society and Ors FAO 351/2014 shall be of relevance. The Delhi High
Court has held that the petition for seeking succession certificate shall have
to be filed in a District Court of appropriate jurisdiction and the appropriate
jurisdiction of District Court shall be such District Court within whose
territorial jurisdiction, the deceased ordinarily resided at the time of his
death. However, there may be a situation that the deceased may not have a fixed
place of abode at the time of his death and in that event if any part of
property of deceased is found may also have jurisdiction for entertaining a
petition for seeking succession certificate. The Delhi High Court has held that
the second part shall come into play, only, if first part is not satisfied i.e
if the deceased had no fixed place of residence at the time of his death. It is
also clearly held that the aforesaid two situations shall be relevant. The
place of death of the deceased is not relevant. In PJ Pothen (Supra) the
deceased was ordinary resident of New Delhi, but died in a hospital at Cochin
(Kerala) and thus it was held that for the purpose of Section 371 of the Act,
the deceased shall be treated as ordinary resident of New Delhi only.
Prior to the dicta of Delhi High
Court as referred to above, in a matter captioned as Rameshwari Devi Vs Raj Bali Shah
& Anr 1987 (13) ALR 705, Allahabad High Court has also held
accordingly. Similar ratio was laid down in Shiv Kumar Vs Bhanu Prakash Singh
MANU/MP/0408/1961. It is relevant to point out that in Shiv Kumar
(Supra) the deceased was ordinary resident within the territorial limit of
District Court , Rajgarh, however, she expired in Bombay, where she went for
treatment and it was held that Rajgarh Court shall be the appropriate court for
seeking succession certificate and not the courts of Bombay.
Yet another aspect of it could be
perused in Madhuribai Mohan Walke Vs Anr Vs Annapurnabai Keshao Walke & Anr
MANU/MH/0417/2003, the deceased was ordinary resident of “Wedshi” (Yavatrmal),
however, he was posted at “Gadchiroli” and on account of his employment he was
residing at “Gadchiroli” and therefore his ordinary place of residence was
treated as “Gadchiroli” for the purpose of Section 371 of Indian Succession Act
1925. What is significant to note in the aforesaid context is that even
permanent place of residence is of no relevance for the aforesaid purpose and
under Indian Succession Act.
Thus, it clearly emerges that
place of death of deceased shall be of no relevance for the purpose of
preferring petition for seeking succession certificate. The place of ordinary
residence of the deceased at the time of his death shall be relevant.
Extension of certificate:
(S. 376)
As per section 376 of Indian
Succession Act, 1925, application for seeking succession certificate could be
moved by the class 1 legal heirs of deceased before a District Judge. A
succession certificate could be issued and certificate could be extended to any
debt or security that may not have been not originally specified therein. A
bond or further bond or other security for the purpose mentioned in section 375
may also be required, in the same manner. It may be worthwhile to reproduce
Section 375 herein for ready reference:
Requisition of security from grantee of certificate(S 375)
(1) The District Judge shall in any case in which he proposes to
proceed under sub-section (1) or sub-section (4) of section 373, and may, in
other case, require, as a condition precedent to the granting of a certificate,
that the person to whom he proposes to make the grant shall give to the judge a
bond with one more surety or sureties, or other sufficient security, for
rendering an account of debts and securities received by him and for indemnity of
person who may be entitled to the whole or any part of those debts and
securities.
(2) The judge may, on application made by petition and on cause
shown to his satisfaction, and upon such terms as to security, or providing
that the money received be paid into Court, or otherwise, as he thinks fit,
assign the bond or other security to some proper person, and that person shall thereupon
be entitled to sue thereon in his own name as if it had been originally given to
him instead of to the Judge of the Court, and to recover, as trustee for all
person interested, such amount as may be recoverable thereunder.
Validity of Succession Certificate:
Section 381 of the Indian Succession
Act, 1925, stipulates the effect of the certificate issued by a District judge,
in respect to debts and securities shall be conclusive against those who owe debts
or may have a liability towards such security.
A succession certificate has validity
throughout India.
Revocation of the Succession Certificate (S.383):
There has also been stipulations as
regards revocation of Succession Certificate so issued may be revoked by a
District judge, on the following ground or grounds.
(a)
If process to obtain the certificates
were defective in substance;
(b)
If certificate is obtained by fraud,
manipulation or concealments of material facts;
(c)
If certificate is obtained by means
of untrue allegation of facts essential in point of law to justify the grant
thereof, though such allegation may have been made inadvertently or ignorantly;
(d)
If the certificate is rendered
useless and inoperative through circumstances;
(e)
If a decree or order made by a
competent Court in suit or other proceedings with respect to effects comprising
debts or securities specified in the certificate renders it proper that the
certificate should be revoked.
APPEAL
Section 384 of the Indian Succession
Act 1925 provides for the appeal before High Court from an order of District Court,
whether granting succession certificate or not granting it or revoking the certificate.
Subject to the order of High Court whether in appeal or under any other proceedings,
the order passed by the District Judge shall be final.
In order to prefer a petition for
seeking succession certificate before a District Court, it may be worthwhile
for legal heirs claiming succession to obtain Surviving Members Certificate
(SMC) as surviving legal heirs of deceased, so as to facilitate the hearing,
before the District Court. The diagnostic features of SMC and Succession Certificate
are illustrated as under:
|
SMC |
Succession Certificate |
|
1.
It
identifies the rightful successor, who then may raise claim on the
assets/properties of the deceased person. |
1.
It
is a document giving authority to the person to represent the deceased for
the purposes of collecting the debts and securities due to him or payable in
his name |
|
2. May be used for the purpose of
transferring utilities such as Electricity connection, Telephone connection,
House Tax, Bank Account etc. |
3. It is required for movable
property such as shares, debentures, bank deposits, loans, or other
securities |
|
4. SMC could be issued by a Revenue
Officer / Tehsildar of a concerned district |
4. The District Judge grants
certificate, provided the deceased had been an ordinary resident at the time
of his death, within the territorial limit of jurisdiction of such district
judge, or, if the deceased did not have a permanent place of residence at the
time of his or her death, then succession certificate could also be issued by
a District judge in the jurisdiction where any part of the deceased’s property
falls. |
|
5. The application can be made only
by spouse, children, parents, or siblings of the deceased. |
5. The application of succession
certificate can only be made by class I legal heirs or class 2 legal heirs ,
if class 1 legal heirs are not there. |
|
6. Generally time consumed could 15
to 20 days for this purpose. |
6. A detailed process is entailed for
objections and after disposal of objections and citations in newspaper and after
the hearing , the certificate is issued. |
|
7. It is issued only with a view to identify
heirs of deceased person. |
7. It is issued to establish validity
and legality of the heirs and also to accord them authority in respect of assets
and securities of the deceased persons. |
|
8. The documents to be furnished in
this regard shall be (i) Death certificate (ii) Identity Card, (iii) Ration
Card with names of family members and relationship along with affidavit executed
on stamp paper |
8. Death certificate shall be
required apart from the specifics such time and place of death, the name of
all legal heirs and relation with the deceased and place of ordinary abode of
deceased. 2-3% stamp paper towards the value
of assets in respect whereof succession certificate are sought shall have to
be deposited. |
|
9. It serve as a prima facie
certificate and not conclusive in itself. |
9. It is conclusive, unless revoked
and it is an evidence of representative status. |
In view of what are illustrated above , it is
explicit that the law of succession stipulates and
prescribes rules relating to devolution of properties of a deceased, who dies
intestate i.e., without making a will. By virtue of obtaining a succession
certificate, a grantee of a certificate under the Indian Succession Act, 1925 shall
have authority to represent the deceased for the purposes of collecting the
debts and securities due to him or payable in his name. It is also to ensure
that banks or such other agency who holds money of deceased, can pay the Legal
Heirs in terms of succession certificate, without any further hassles. It is
also to be borne in mind that the Certificate does not establish the title of
the grantee as the heir of the deceased, but only furnishes him with an
authority to collect the debts and allows the debtors to make payment to the
grantee without incurring any risk and in case nominees are not named by the deceased.
In other words, the succession certificate shall be an authentic document guaranteeing
legal heirs who obtains succession certificate as the only legal heir/heirs of
the deceased property.
--------
Anil
K Khaware
Founder & Senior Associate
Societylawandjustice.com
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