My father and I jointly held a demat account. After he died six months ago, I opened a new demat account in my name and transferred all the shares to that account. Can my brothers claim the shares that I jointly held with my father? Also, my mother holds a membership of a society of a plot of land where one of my brothers is a nominee. Can other brothers claim the plot if my mother dies without leaving a will?
As per the provisions of the Companies Act, 1956 and the bye-laws of the National Securities Depository Ltd (NSDL) and the Central Depository Services (India) Ltd (CDSL), where shares are held jointly, upon the demise of one of the joint holders, the surviving holder will be recognized as having title to the shares, subject to production of certain evidences required by the company/NSDL/CDSL. Therefore, in your case, upon the demise of your father, the shares held jointly by you and your father, will vest in your name. However, your brothers, in the absence of a will to the contrary, could make a claim, either for their share in the entire holding or in the 50% holding of your father.
Decisive factors for a court to consider in this case, for which things that have to be established, would be: 1) whether the shares were entirely purchased by your father out of his own money or earnings and if you were made a joint holder merely for convenience (in which case your brothers could have a claim in the entire holding); or (2) whether you and your father contributed equally towards the purchases of shares (in which case your brothers could have a claim in the 50% holding of your father); or (3) whether the shares were purchased entirely by you and your father was made a joint holder for convenience (in which case your brothers would have no claim in the entire holding). Another factor would be in whose tax returns the shares and dividends (although exempt from tax) were being shown. This, too, would determine as to whom the shares belong. Again, if they were your father’s, your brothers could make a claim for their share.
Meanwhile in your mother’s case, if it is a co-operative society where a nominee has been appointed by a member, the society normally enters the name of the nominee as a member upon the death of the original member, the nominee is not actually the owner of the land but is merely a trustee holding the membership for the benefit of heirs or persons entitled thereto. Therefore, your brother being the nominee is not the owner of this share but a trustee. So, all legal heirs of your mother can claim their share in the plot on her demise if she doesn’t leave a will, notwithstanding the nomination in favour of your brother.
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