Nilesh Shah Writes:
Cell: 92246-59941
E mail: nilesh63@vsnl.
What is the effect of nomination made in respect of National Savings
Certificate.
The object of section 6 of the Government Savings Certificates Act,
1959, which provides for the making of nomination by holders of
certificates, is to avoid the delay and expense involved in
production of legal proof of succession, by enabling holders of
savings certificates to nominate one or more persons to receive the
amounts due in respect of such certificates in the event of their
death without the production of succession certificate or other proof
of title. Though the nominee of National Savings Certificates has a
right to be paid the sum due on such savings certificates after the
death of the holder, yet he retains the said amount for the benefit
of the persons who are entitled to it under the law of succession
applicable in the case, however, subject to the exception of
deductions mentioned in sub-section (2) of section 8. Any amount paid
to the nominee after valid deductions becomes the estate of the
deceased. Such an estate devolves upon all persons who are entitled
to succession under law, custom or testament of the deceased holder.
The nominee who becomes entitled to the payment of the amount on
account of National Savings Certificate received by him under section
6 read with section 7 of the Act, in turn is liable to return the
amount to those, in whose favour law creates beneficial interest,
subject to the provisions of sub-section (2) of section 8 of the Act.
Your's Sincerely,
Nilesh Shah.
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CAclubindia
