The Allahabad High Court while disposing a petition held that while a nominee has a right to obtain money from the bank after the account holder’s death, the money received by nominee would be subject to the succession laws and the heirs of the deceased would have a right to the said amount in accordance with law.
The Division Bench of Justice Shekhar B Saraf and Justice Vipin Chandra Dixit passed this order while hearing a petition filed by Manoj Kumar Sharma.
The petition has been filed seeking the following reliefs:-
“(I) Issue a Writ, order or direction in the nature of Mandamus directing and commanding the respondent No 2 to release the FDR Accounts in favour of petitioner as being a nominee and a legal heir.
(II) To, issue any other writ order or direction which the Court may deem just and proper and the circumstances of the case.
(III) Award the cost of the petition in favour of the petitioner.”
The facts of the case are that the mother of the petitioner died on February 8, 2020. Before the death of the mother of the petitioner, the mother of the petitioner was owner of several properties as well as owner of several FDRs at the Bank of Baroda. In all these FDRs the petitioner has been named as a nominee.
It is to be noted that the petitioner had also filed a succession suit being a Civil Suit before the Civil Judge (Senior Division)/FTC, Moradabad. However, this suit was dismissed on the ground that there was another suit pending for cancellation of the alleged will of the petitioner’s mother.
The petitioner’s main argument is that the petitioner being the nominee, the petitioner is entitled to receive the money in the FDRs as per Section 45ZA of the Banking Regulation Act, 1949.
Per contra counsel appearing on behalf of private respondents and the State submitted that Section 45ZA of the Banking Regulation Act cannot overrule the laws of succession and, therefore, even if the money is required to be given to the petitioner, the same would have to be held by the petitioner in trust for the legal heirs of the deceased.
Upon analysis of the catena of Supreme Court judgments and the judgment delivered by the co-ordinate Bench, the Court is of the view that it is patently clear that the petitioner has a right to obtain the money from the bank as he is a nominee.
However, the Court observed that this money which is received by the petitioner would be subject to the succession laws and the heirs of the deceased would have a right to the said amount in accordance with law.
Counsel on behalf of petitioner has given an undertaking before the Court that he shall hold the money in trust and shall be liable to make payment to the legal heirs if and when decided by the courts of law in accordance with law.
In light of the same, the Court directed the Bank of Baroda to release the amounts lying in FDRs in favour of the petitioner within a period of three weeks from date.
The Court further directed the petitioner to file an affidavit before Bank of Baroda that money being received by him is being held by him in trust and undertakes to make payment of the same to the legal heirs as and when decided.
With the above direction the Court disposed of the petition.