Ensure Smooth Passing Over of Your Immovable Properties

Keep A Joint Holder Or Make A Nomination

And Direct A Clear Bequest Under Your Will!

Several readers have raised a number of interesting queries with reference to the two articles on Will in this column during the last fortnight. Some issues of practical importance are responded to hereunder:

 Overcoming Problems for Property in Single Name

 Query: Many times an immovable property is purchased only in single name, since that person alone has invested the funds in acquisition of the property. Where such investment has been made in the single name of the head of the household, what should be done to facilitate the smooth passing over of the property to his wife or his son or daughter?

 -Ramkrishna Shenoy, Vijay Bhargava, Valmik Majmudar

 Reply: Wherever practicable, the registration of an immovable property should be executed in joint names to facilitate smooth passing over in future. It is, however, not necessary that the second name holder should contribute any funds for having his or her name entered jointly. In such a case, the first name holder, who invests in the acquisition of the property, remains its real owner.

 Where the property held in single name is under a cooperative society or an association, the owner of the property can conveniently file a letter of nomination with the society or association declaring that upon his death the same may be transferred in the name of his nominee.

  Where joint holding or nomination is not feasible and the property has to remain in the single name of its owner, his Will must contain clear directions in whose favour the property is bequeathed, in absence of which the smooth passing over of property after his death can become not only cumbersome, but also time consuming and expensive.

Rights of Joint Holders & Nominees

Query: In respect of investments such as bank deposits, shares, etc. in joint names (either or survivor basis) or in case of a nomination (as in a PPF account), does the joint holder or the nominee automatically enjoy the absolute right of ownership over such investments or would the directions under the Will prevail? Would it make any difference in case no Will is executed?

 -S K Bansal, Dr. Arunkumar, Praveen Singh

Reply: Both in regard to joint holding as well as nomination, it needs to be borne in mind that the joint holder enjoys the privilege of withdrawing the investment and the nominee is entitled to collect the proceeds of the investment. This essentially facilitates the smooth operation and passing over of investments. But the joint holder or the nominee do not automatically become the legal owner of the property of the deceased, until so specifically directed under his Will.

 Both the joint holder or the nominee, if not directed to lawfully receive the property as a beneficiary under the Will, would be accountable to the executors of  the estate  of  the deceased, to hand over the  proceeds  of  the investment, which  would  ultimately  be  required  to be allocated to the concerned beneficiaries in accordance with the terms of the Will.

 Where no Will is executed, division of the properties, in case of the deceased being a male Hindu, is required to be done in equal shares amongst his heirs under Schedule-I of the Hindu Succession Act, which include his wife, mother, sons and daughters. The joint holder or the nominee in such a case would be accountable to the legal heirs, who can claim their rightful share as per law.

 Model Draft of Will

            Many readers have requested for a model draft of a simple Will. While constraints of space do not permit presenting the same here, for the benefit of the readers, a copy of the same has been hosted on the dedicated site of your columnist www.taxingtimes.in from which the same can be freely downloaded.