What is Succession Certificate

U/S 372 of the Indian Succession Act

The expression ‘succession certificate’ has not been defined in the Act. The preamble to Succession Certificate (Act VII of 1889) gives an idea about the object of such certificate. The preamble states “whereas it is expedient to facilitate the collection of debts on succession and afford protection to parties paying debts to the representatives of the deceased person”. The object in re-enacting part ‘X’ of the Act is to facilitate collection of debts and not to enable the parties to litigate question of disputed title. The grant of certificate does not determine any question of title or decide what privilege does or does not belong to estate of the deceased; it merely enables a party to whom certificate is granted to collect any debt or security belonging to the deceased (See Paruck Indian Succession Act, 8th Edn. P. 782).

The succession certificate under part ‘X’ of the Act can only be granted in following cases :

(a) When grant of probate or letters of administration is not compulsory under Sections 212 and 213.

(b) When deceased is an Indian Christian.

(c) When deceased is a Mohommadan.

(d) When deceased is a Hindu and has left a will and probate of such will is not compulsory. In case of joint Family property under Hindu Law etc.

Thus, family pension payable to the legal representative of the deceased does not need a Succession Certificate, even if it were a debt belonging to the deceased. However, Section 214 of the Act provides that no Court shall ;

(a) pass a decree against a debtor of a deceased person for payment of his debt to a person claiming on succession to be entitled to the estate of the deceased person or to any part thereof, or

(b) proceed upon an application by a person claiming to , be entitled to execute such debtor a decree or order for payment of his debt except on production by the person so claiming, or

(c) a succession certificate granted under part-X and haying the debts specified therein.

Sub-section (2) of Section 214 says that the word ‘debt’ in Sub-section (1) includes any debt except rent, revenue or profits, payable in respect of the land used for agricultural purpose.

In the leading cases of The Managing Director (MIG) Hindustan Aeronautics Ltd. and Another, Balanagar Vs. Ajit Prasad Tarway, followed by Tulsi Debya Vs. Bibhuti Bhusan Goswami and Others, and In Re: Pasupati Nath Mukerjee, meaning of debt has been said to be ‘a debt is a sum of money payable at present or in future by reason of present obligation’ State Bank of India Vs. Inuganti Venkata Satyanarayana Ramachandra Rao and Others, says that Bank deposit is a debt. However, in Branch Manager, State Bank of India, Puri Branch Vs. Satyaban Pathal and Others, gold ornaments pledged with the Bank as security for loan obtained does not come under the term ‘debt’ or ‘security’ initiating obtainment of succession certificate.

The matter has been clarified in a case reported in Smt. Nirupama Sarkar and others Vs. Life Insurance Corporation of India, , which deals with a suit filed by the plaintiffs against the life Insurance Corporation for entitlement and recovery of family pension. It was held that it is an independent claim and not claimed through the deceased employee. As such, Section 214 of the Act would not be a bar against maintainability of the suit of such claim without production of succession certificate.

Though Section 370 of the Act does not apply, a representative of the deceased cannot maintain a suit or proceeding against an employer of the deceased without obtaining succession certificate u/s 214, provided it is a debt or security sought to be collected. Thus, to receive family pension, a succession certificate is not necessary as it is neither a ‘debt’ not ‘security’.

But a perusal of the succession petition goes to show that the petitioner therein (opp. party in this revision) not only prayed for grant of certificate for family pension, but also for provident fund, leave encashment, arrear pay and allowances etc. Thus, a composite prayer has been made which also includes the provident fund.

So far as the provident fund dues are concerned, the same are governed under the provisions of the Provident Fund Act, 1925. Section 4 of the Provident Fund Act itself provides that, when under the rules of any Government or Railway Provident Fund, the sum standing to the credit of any subscriber if he is dead, shall, if the amount does not exceed rupees five thousand, stand as such, are not covered by Clause (a) and (b) of Sub-section (i) of Section 4. Clause (c)(i) would be applicable which says that any person nominated to receive the amount of debt under the rules of the Provident Fund on production by such person a certificate granted under the Succession Certificate Act, 1889 entitling the holder thereof to receive the payment of such sum or balance or part and if no person is nominated, Clause (c)(ii) of Sub-section (1) of Section 4 comes to play. The debt would be paid to any person who produces probate, letter or the certificate. Section 5(2) of the Provident Fund Act lays down as follows :

“(2) Notwithstanding anything contained in the Indian Succession Act, 1925, or the Bombay Regulation VIM of 1827, any person who becomes entitled as aforesaid, may be granted a certificate under that Act, or that Regulation, as the case may be, entitling him to receive payment of such sum or part, and such certificate shall not be deemed to be invalidated or superseded by any grant to any other person of probate or letters of administration to the estate of the deceased.”

The aforesaid provision envisages that in certain contingencies, a succession certificate should be obtained to establish the right of persons claiming the amount to receive the money. This Court, therefore, is of the opinion, considering the matter under the Provident Fund Act, that a succession certificate can be granted in certain contingencies. It, therefore, follows that this Act itself envisages that a succession certificate may be issued by the Court in respect of the provident fund money. This view gets support from a decision reported in Smt. Rajjoo Devi Vs. Nageshwar and Others,

 In view of the finding that succession certificate can be issued for disbursement of provident fund, the court below was absolutely justified in granting the certificate under the Act. Although the family pension is not a ‘debt’, but in view of the fact that there is a composite prayer for family pension, provident fund, leave encashment etc., the proceeding is maintainable, particularly when the authorities demanded the certificate under the Act for disbursement of the dues on account of the death of the employee.

References :

Smt. Rajjoo Devi Vs. Nageshwar and Others, AIR 1965 All 267 : (1964) 9 FLR 391 : (1965) 1 LLJ 20
In Re: Pasupati Nath Mukerjee, AIR 1933 Cal 841
The Managing Director (MIG) Hindustan Aeronautics Ltd. and Another, Balanagar Vs. Ajit Prasad Tarway, AIR 1973 SC 76 : (1973) LabIC 407 : (1972) 1 LLJ 170 : (1972) 3 SCC 195 : (1972) 4 UJ 195
Tulsi Debya Vs. Bibhuti Bhusan Goswami and Others, AIR 1937 Cal 423 : 173 Ind. Cas. 429
Smt. Nirupama Sarkar and others Vs. Life Insurance Corporation of India, AIR 1996 Cal 417
Branch Manager, State Bank of India, Puri Branch Vs. Satyaban Pathal and Others, AIR 1989 Ori 236 : (1991) 71 CompCas 251
State Bank of India Vs. Inuganti Venkata Satyanarayana Ramachandra Rao and Others, AIR 1964 AP 378 : (1963) 2 AnWR 424