Although the usual scenario to be expected in the event of demise of our loved one, is that he or she must have left a Will to ensure our security and smoothen the process of distribution of his/her properties. But what happens if there is no Will? To whom his/her will property pass on? And what are the complications to be expected in such events. The Hindi Succession Act,1956 has set out certain rules to govern the distribution of the property in the absence of a Will.
Intestate Succession means when person dies without making a Will, which is capable of taking effect. The property devolves upon the wife or husband or upon the relatives of the deceased in the following manner.
All class one legal heirs have equal rights on the deceased assets. In case of Hindus, class one legal heirs include your mother, spouse and children. If any of your children has died, then their children and spouse have an equal share.
If you have no class one legal heir, then your class two legal heirs can stake a claim. Class two heirs include your father, siblings, living child.
The property of an intestate devolves upon the wife or husband, or upon those who are of the nearby of the deceased, in the order and according to the rules given below.
Where the intestate has a widow –
If he has also left any lineal descendants (Lineal descendants mean descendant born in wedlock only) one third of his property shall belong to his widow, and the remaining two-thirds shall go to his lineal descendants, according to the rules here in after contained.
If he has left no lineal descendant, but has left persons who are of kindred to him, one-half of his property shall belong to his widow, and the other half shall go to those who are of kindred to him, if he has left none who are of kindred to him, the whole of his property shall belong to his widow.
Where intestate has left no widow, and where he has left no kindred –
Where the intestate has left no widow, his property shall go to his lineal descendants or to those who are of kindred to him. If he has left none who are of kindred to him, it shall go to the Government.
Where intestate has left child or children only –
Where the intestate has left a child or children, but no more remote lineal descendant through a deceased child, the property shall belong to his surviving child, if there is only one, or shall be equally divided among all his surviving children.
Where intestate has left no child, but grandchild or grandchildren –
Where the intestate has not left surviving him any child, but has left a grandchild or grandchildren and no more remote descendant through a deceased grandchild, the property shall belong to his surviving grandchild if there is only one, or shall be equally divided among all his surviving grandchildren.
Where intestate leaves lineal descendants not all in same degree of kindred to him –
If the intestate has left lineal descendants who do not all stand in the same degree of kindred to him, and the persons through whom the more remote are descended from him are dead, the property shall be divided into such a number of equal shares as may correspond with the number of the lineal descendants of the intestate who either stood in the nearest degree of kindred to him at his decease, or, having been of the like degree of kindred to him, died before him, leaving lineal descendants who survived him.
Moveable assets include bank deposits, mutual funds and other investments, such as post office schemes, made with financial institutions.
At the time of investment, almost all of these require the investor to fill up a nominee name. If the nominations are in place, then, banks and financial institutions will release the funds, to the nominee mentioned.
But a nominee is only a trustee of the funds, which he is expected to safeguard till such time as the legal heir or beneficiary can be determined and the proceeds can be passed on to him. This means that although the banks or financial institutes release the money to a nominee, other legal heirs can stake claim.
If there is no nominee and the amount is fairly small, banks will release the funds up to a limit, provided the person withdrawing the money signs an indemnity stating that he is in possession of the money and will be held responsible for payments in case a more authentic claimant appears.
If the funds are in excess of this limit and there is no nominee, then the banks will ask the person staking a claim to produce a succession certificate.
A succession certificate establishes who the legal heirs of the deceased are and gives them the authority to inherit debts, securities and any other assets. The beneficiaries can file a petition for a succession certificate in a district or high court as the two have concurrent jurisdiction.
In case of an immovable property that is not disputed, only the title of ownership has to be changed. This can be done at the relevant district authority under whose jurisdiction the property falls.
To get the holding transferred in name of the beneficiary, it requires a series of documents, such as a formal application and an affidavit, the death certificates of the deceased and any other deceased class one legal heir, relinquishment deeds from legal heirs who are willing to concede their share, indemnity bond and undertaking and anything else that may be demanded.
In case the matter goes to the court, the court will first ask the beneficiaries to determine if the property can be divided physically. If this is not possible, then one heir can buy out the share of the other. This is called right of pre-emption.