{"id":248764,"date":"2010-04-20T00:00:00","date_gmt":"2010-04-19T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/harsha-nitin-kokate-vs-the-saraswat-co-op-bank-ltd-on-20-april-2010"},"modified":"2018-03-01T00:52:37","modified_gmt":"2018-02-28T19:22:37","slug":"harsha-nitin-kokate-vs-the-saraswat-co-op-bank-ltd-on-20-april-2010","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/harsha-nitin-kokate-vs-the-saraswat-co-op-bank-ltd-on-20-april-2010","title":{"rendered":"Harsha Nitin Kokate vs The Saraswat Co-Op. Bank Ltd. &amp; &#8230; on 20 April, 2010"},"content":{"rendered":"<div class=\"docsource_main\">Bombay High Court<\/div>\n<div class=\"doc_title\">Harsha Nitin Kokate vs The Saraswat Co-Op. Bank Ltd. &amp; &#8230; on 20 April, 2010<\/div>\n<div class=\"doc_bench\">Bench: R. S. Dalvi<\/div>\n<pre id=\"pre_1\">                                                 1\n\nMNM\n\n\n\n\n                                                                                          \n                                                                  \n                IN THE HIGH COURT OF JUDICATURE AT BOMBAY\n                   ORDINARY ORIGINAL CIVIL JURISDICTION \n\n                         NOTICE OF MOTION NO. 2351 OF 2008\n\n\n\n\n                                                                 \n                                         IN\n                               SUIT NO. 1972 OF 2008\n\nHarsha Nitin Kokate                                             ...Plaintiff\n\n\n\n\n                                                     \n     Vs.\nThe Saraswat Co-op. Bank Ltd. &amp; Ors. ig                         ...Defendants\n\nMr. A.K. Maheshwari for Plaintiff\nMs. Shyama Parkar i\/b. M.P.Rege &amp; Co., for Defendant No.1\n                                   \nMr. H.S. Shreepad Murthy for Defendant No.3\n\n\n                                              CORAM : SMT. ROSHAN DALVI, J.\n<\/pre>\n<p id=\"p_1\">                                               DATED   : 20TH APRIL, 2010<\/p>\n<p>JUDGMENT. :\n<\/p>\n<blockquote id=\"blockquote_1\"><p>    1. The   Plaintiff   married   one   Nitin   Kokate   on   3rd  December   2004.     Her<br \/>\n       husband expired on 5th  July 2007.  Nitin Kokate held certain shares in D-<br \/>\n       mat Account with the Depository Participant Cell of Defendant No.1.  Her <\/p>\n<p>       husband   executed   a   nomination   in   the   prescribed   form   following   the<br \/>\n       prescribed procedure set out by the Depository Participant, Defendant No.1<br \/>\n       Bank in favour of the Defendant No.3, his nephew on 11th July 2006.  The<br \/>\n       Plaintiff   claims   an   interest   in   the   said   shares   as   his   heir   and   legal <\/p>\n<p><span class=\"hidden_text\" id=\"span_1\">                                                                  ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_1\">                                                2<\/span><\/p>\n<p>      representative.  She claims to have them sold.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_1\"><p>    2. This Suit is not concerned with the reason why she claims the sale of the<br \/>\n      shares.  The Plaintiff must show her legal right, title and interest in those <\/p>\n<p>      shares.  If that is shown, the Plaintiff would be entitled to sell or transfer<br \/>\n      those shares or to hold them as her own.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_2\"><p>    3. The Defendant No.3 claims right, title and interest in the shares pursuant<br \/>\n      to   the   nomination   executed   in   his   favour.     The   nomination   has   been <\/p>\n<p>      executed   well   prior   to   the   death   of   the   deceased   and   well   after   his <\/p>\n<p>      marriage with the Plaintiff.  The Defendant No.1 Bank has stated that the<br \/>\n      nomination is executed as required and has been so registered with the <\/p>\n<p>      Depository Participant.   The effect of the nomination is, therefore, to be<br \/>\n      seen.  The nomination form itself shows that the rights of transfer and\/or<br \/>\n      the   amount   payable   in   respect   of   the   securities   held   by   Nitin   Kokate, <\/p>\n<p>      Defendant No.3 vests in him as the said nominee.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_3\"><p>    4. The law relating to nomination is set out in 109<a href=\"\/doc\/1353758\/\" id=\"a_1\">A of the Companies Act<\/a> <\/p>\n<p>      pursuant to the amendment which came into effect on 31st October 1998. It<br \/>\n      is   common   knowledge   that   prior   to   1996   shares   were   not   held   in   de-<br \/>\n      materialised form.  Consequent upon the Dematting of the shares the Share <\/p>\n<p>      Certificates in physical form are not mandatorily required to be issued by<br \/>\n      the   Limited   Companies   listed   on   the   Stock   Exchanges.     Shares   can   be<br \/>\n      transferred by word of mouth or on the Internet from person to person.<br \/>\n      Upon   such   transfer   the   membership   rights   of   the   holder   of   the   shares<br \/>\n      changes.     Since   the   share   is   an   intangible   movable   property   it   is <\/p>\n<p><span class=\"hidden_text\" id=\"span_2\">                                                                ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_3\">                                                 3<\/span><\/p>\n<p>    bequeathable estate  The nomination in respect of the shares is, therefore,<br \/>\n    important.     <a href=\"\/doc\/1353758\/\" id=\"a_1\">Section   109A<\/a>   sets   out   the   rights   of   the   holder   of   shares   to <\/p>\n<p>    nominate as well as the rights of the nominees thus:-\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_4\"><p>           S.109A.  Nomination of shares  &#8211;  (1)   Every   holder  of   shares   in,  or<br \/>\n           holder of debentures of a company may, at any time, nominate, in the <\/p>\n<p>           prescribed manner, a person to whom his shares in or debentures of, the<br \/>\n           company shall vest in the event of his death.<br \/>\n           (2) &#8230;&#8230;&#8230;..\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_5\"><p>           (3) Notwithstanding anything contained in any other law for the time  <\/p>\n<p>           being in force or in any disposition, whether testamentary or otherwise,<br \/>\n           in respect of such shares in, or debentures of, the company, where a  <\/p>\n<p>           nomination made  in the prescribed manner  purports to confer on any<br \/>\n           person the right to vest the shares in, or debentures of, the company, the  <\/p>\n<p>           nominee shall, on the death of the shareholder or holder of debentures<br \/>\n           of the company or, as the case may be, on the death of the joint holders  <\/p>\n<p>           become   entitled   to   all   the   rights   in   the   shares   or   debentures   of   the<br \/>\n           company or, as the case may be, all the joint holders, in relation to such  <\/p>\n<p>           shares in, or debentures of the company  to the exclusion of all other<br \/>\n           persons, unless the nomination is varied or cancelled in the prescribed<br \/>\n           manner.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_6\"><p>           (4)&#8230;&#8230;&#8230;<\/p><\/blockquote>\n<blockquote id=\"blockquote_7\"><p>           It   can   be   seen   from   the   aforesaid   provision   that   nomination   is<br \/>\n    required to be made in the prescribed manner.  Upon such nomination the <\/p>\n<p><span class=\"hidden_text\" id=\"span_4\">                                                                   ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_5\">                                                  4<\/span><\/p>\n<p>      shares would vest in the nominee in the event of the death of the holder.<br \/>\n      Further upon it being made in the prescribed manner the nominee would <\/p>\n<p>      become   entitled   to   all   the   rights   in   the   shares   of   the   Company   to   the<br \/>\n      exclusion of all other persons.  That is the effect of vesting the shares in the <\/p>\n<p>      nominee.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_8\"><p>    5. Mr. Maheshwari drew my attention to the <a href=\"\/doc\/531893\/\" id=\"a_2\">Depositories Act<\/a> 1996.  <a href=\"\/doc\/1155368\/\" id=\"a_3\">Section<br \/>\n      9<\/a>.11 thereof relates to transmission of securities in the case of nomination.<br \/>\n      <a href=\"\/doc\/1155368\/\" id=\"a_4\">Section 9<\/a>.11 runs thus:-\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_9\"><p>                    9.11.   TRANSMISSION   OF   SECURITIES   IN   THE   CASE   OF<br \/>\n                    NOMINATION:\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_10\"><p>                    9.11.1.   In   respect   of   every   account,   the  Beneficial   Owner(s)<br \/>\n                    (&#8220;Nominating Person(s)&#8221;) may nominate any person (&#8220;Nominee&#8221;)<br \/>\n                    to whom his securities shall vest in the event of his death in the<br \/>\n                    manner prescribed under the Business Rules from time to time.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_11\"><p>                    9.11.2. The securities held in such account shall automatically be <\/p>\n<p>                    transferred in the name of the Nominee, upon the death of the<br \/>\n                    Nominating Person, or as the case may be, all the Nominating<br \/>\n                    Persons subject to the other Bye Laws mentioned hereunder.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_12\"><p>                    9.11.3&#8230;&#8230;..\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_13\"><p>                    9.11.4.   Beneficial   Owner(s)   may   substitute   or   cancel   a<br \/>\n                    nomination   at   any   time.     A   valid   nomination,   substitution   or  <\/p>\n<p>                    cancellation   of   nomination   shall   be  dated  and  duly   registered<br \/>\n                    with   the   Participant  in   accordance   with   the  Business   Rules<br \/>\n                    prescribed therefor.  The closure of the account by the Nominating<br \/>\n                    Person(s) shall conclusively cancel the nomination.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_14\"><p>                    9.11.5.   A   Nominee   shall   not   be   entitled   to   exercise   any   right  <\/p>\n<p><span class=\"hidden_text\" id=\"span_6\">                                                                   ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_7\">                                                 5<\/span><\/p>\n<p>                   conferred on Beneficial Owners under these Bye Laws, upon the<br \/>\n                   death of the Nominating Person(s), unless the Nominee  follows<br \/>\n                   the procedure prescribed in the Business Rules for being registered  <\/p>\n<p>                   as   the   Beneficial   Owner   of   the   securities   of   the   Nominating<br \/>\n                   Person(s) in the books of the Depository.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_15\"><p>                   9.11.6.   A   nominee   shall   on   the   death   of   the   Nominating<br \/>\n                   Person(s)   be   entitled   to   elect   himself   to   be  registered  as   a <\/p>\n<p>                   Beneficial   Owner  by   delivering   a  notice  in   writing   to   the<br \/>\n                   Depository,   along   with   the   certified   true   copy   of   the  death<br \/>\n                   certificate  issued by the competent authority as prescribed under<br \/>\n                   the  Business   Rules.     Subject   to   scrutiny   of   such   election,   the <\/p>\n<p>                   securities in the Account shall be transmitted to the account of the<br \/>\n                   Nominee held with any depository.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_16\"><p>                   9.11.7.  Notwithstanding  anything   contained   in   any   other  <\/p>\n<p>                   disposition   and\/or   nominations   made   by   the   Nominating<br \/>\n                   Person(s) under any other law for the time being in force, for the<br \/>\n                   purposes   of   dealing   with   the   securities   lying   to   the   credit   of<br \/>\n                   deceased   Nominating   Person(s)   in   any   manner,   the  Depository <\/p>\n<p>                   shall  rely  upon   the  last   nomination  validly   made   prior   to   the<br \/>\n                   demise of the Nominating Person(s).  The Depository shall not be  <\/p>\n<p>                   liable for any action taken in reliance upon and on the basis of<br \/>\n                   nomination validly made by the Nominating Person(s).\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_17\"><p>                   9.11.8&#8230;&#8230;\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_18\"><p>                                                                        (underlining supplied)<\/p>\n<\/blockquote>\n<blockquote id=\"blockquote_19\"><p>    6. Upon such nomination the securities automatically get transferred in the<br \/>\n      name   of   the   nominee   upon   the   death   of   the   holder   of   shares.     The <\/p>\n<p>      nomination is required to be dematted  duly registered with the Depository<br \/>\n      Participant (Bank) in accordance with the Business Rules.  The nominee is<br \/>\n      required to follow the prescribed procedure in the Business Rules.   Upon<br \/>\n      the death of the holder of the shares the nominee would be entitled to elect <\/p>\n<p><span class=\"hidden_text\" id=\"span_8\">                                                                  ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_9\">                                                   6<\/span><\/p>\n<p>       to be registered as an beneficiary owner by notifying the Bank along with<br \/>\n       the certified copy of the death certificate.  The Bank would be required to <\/p>\n<p>       scrutinise the election and nomination of the nominee registered with it.<br \/>\n       Such nomination   carries effect notwithstanding anything contained in a <\/p>\n<p>       Testamentary   Disposition   or   nominations   made   under   any   other   law<br \/>\n       dealing with the Securities.   The last of the many nominations would be <\/p>\n<p>       valid.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_20\"><p>    7. Under   the   said   Section   the   holders   of   the   shares   would   nominate   any <\/p>\n<p>       person in whom the securities would vest in the event of his death.   This <\/p>\n<p>       nomination has to be made in the manner prescribed under the Business<br \/>\n       Rules.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_21\"><p>    8. It can be seen that since all the shares are held in Demat form with the<br \/>\n       Depository Participant and the portfolio of the holder may change each day.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_22\"><p>       Hence one nomination is specifically required to be made as provided in <\/p>\n<p>       the aforesaid legislation.  The nomination would have the effect of vesting<br \/>\n       in the nominee complete title in the shares.  He would be entitled to elect <\/p>\n<p>       to be registered as a beneficial owner of the shares or he would have the<br \/>\n       right   to   transfer   the   shares.     These   are   inter   alia   the   rights   of   every<br \/>\n       shareholder of a listed Companies.   These rights show that the vesting of <\/p>\n<p>       the   shares   is   upon   the   death  of   the   shareholder   provided   only   that   the<br \/>\n       nomination   is   made   as   per   the   procedure   set   out   by   the   Depository<br \/>\n       Participant. This procedure is the registration of the form of nomination<br \/>\n       constituting the nomination of the nominee with his photograph signed by<br \/>\n       the holder as well as the nominee and witnessed by at least 2 persons and <\/p>\n<p><span class=\"hidden_text\" id=\"span_10\">                                                                    ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_11\">                                                7<\/span><\/p>\n<p>       registered with the Bank.  The purpose and object of this Section is clear.  It<br \/>\n       is simplifies the procedure relating to the transmission of shares which is <\/p>\n<p>       otherwise an intangible movable property.   As the shares are now held in<br \/>\n       Dmat form and can be purchased and sold in the market by word of mouth <\/p>\n<p>       or   on   the   Internet,   and   no   physical   share   certificates   are   issued   by<br \/>\n       Companies, only one nomination for all the shares in all the companies <\/p>\n<p>       need be made.  That can be registered only with the Depository Participant<br \/>\n       who records all the share transactions of the holder of the shares who is<br \/>\n       mandatorily       required   to   open   a   Dmat     account   with   the   Depository <\/p>\n<p>       Participant.     Hence   the   legislature   has   simplified   and   specified   the <\/p>\n<p>       procedure   for   vesting   of   shares   by   nomination   made   in   the   prescribed<br \/>\n       manner.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_23\"><p>    9. Mr.  Maheshwari  on  behalf of  the  Plaintiff  contends that  the  nomination<br \/>\n       only makes a nominee a trustee for the shares.  He holds the shares in trust <\/p>\n<p>       for the estate of the deceased, the deceased died intestate and hence the <\/p>\n<p>       Plaintiff as the widow would be entitled to the shares to the exclusion of<br \/>\n       the nominee.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_24\"><p>    10.Mr.  Maheshwari  drew my attention to the case of  Smt. Sarbati Devi Vs.<br \/>\n       Smt. Usha Devi,  A.I.R. 1984 SC 346 for which a nomination made under <\/p>\n<p>       the <a href=\"\/doc\/1656199\/\" id=\"a_5\">Insurance Act<\/a> in respect of the Life Insurance Policy under <a href=\"\/doc\/531893\/\" id=\"a_6\">Section 39<\/a><br \/>\n       of the Act came to be considered.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_25\"><p>             <a href=\"\/doc\/610691\/\" id=\"a_7\">Section 39<\/a> of the Insurance Act runs thus:-\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_26\"><p>                  39.       Nomination by policy-holder &#8211; (1) The holder of a policy of<br \/>\n                  life insurance on his own life may, when effecting the policy or at  <\/p>\n<p><span class=\"hidden_text\" id=\"span_12\">                                                                ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_13\">                                                8<\/span><\/p>\n<p>                any   time   before   the   policy   matures   for   payment,   nominate   the<br \/>\n                person or persons to whom the money secured by the policy shall be<br \/>\n                paid in the event of his death.&#8221;\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_27\"><p>    11.<a href=\"\/doc\/1656199\/\" id=\"a_8\">Under the Insurance Act<\/a> the nomination entails payment by the Insurance<br \/>\n      Company   to   the   nominee   to   obtain   a   complete   discharge.     Once   the<br \/>\n      amount under the Policy is paid to the nominee, the nominee would hold it <\/p>\n<p>      in   Trust   or   the   Estate   because   under   the   <a href=\"\/doc\/1656199\/\" id=\"a_9\">Insurance   Act<\/a>   there   is   no<br \/>\n      legislative provision that the nominee would obtain any other right.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_28\"><p>    12.It may be mentioned that the position under Section 30 of the Maharashtra <\/p>\n<p>      Co-operative Societies Act is similar for nominees in respect of shares in a<br \/>\n      Housing Society.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_29\"><p>      Section 30 of The Maharashtra Co-operative Societies Act runs thus:-\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_30\"><p>             30.(1) On the death of a member of a society, the society shall transfer<br \/>\n             the share or interest of the deceased member to a person or persons  <\/p>\n<p>             nominated  in accordance with the rules or, if no person has been so  <\/p>\n<p>             nominated, to such person as may appear to the committee to be the<br \/>\n             heir or legal representative of the deceased member:\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_31\"><p>             Provided that, such nominee, heir or legal representative, as the case  <\/p>\n<p>             may be, is duly admitted as a member of the society:\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_32\"><p>             Provided further that, nothing in this sub-section or in <a href=\"\/doc\/750461\/\" id=\"a_10\">section 22<\/a> shall<br \/>\n             prevent   a   minor   or   a   person   of   unsound   mind   from   acquiring   by<br \/>\n             inheritance or otherwise, any share or interest of a deceased member in  <\/p>\n<p>             a Society.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_33\"><p>             (2)&#8230;&#8230;.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_34\"><p>             (3)&#8230;&#8230;.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_35\"><p>             (4) All transfers and payments duly made by a society in accordance<br \/>\n             with the provisions of this section, shall be valid and effectual against<br \/>\n             any demand made upon the society by any other person.\n<\/p><\/blockquote>\n<p><span class=\"hidden_text\" id=\"span_14\">                                                                ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_15\">                                                 9<\/span><\/p>\n<blockquote id=\"blockquote_36\"><p>       Hence   in   a   Co-operative   Society   also   the   shares   of   the   member   can   be <\/p>\n<p>       simplicitor   transferred   to   the   nominee   which   transfer   would   effectually<br \/>\n       discharge the Society as against any other person making a demand.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_37\"><p>       Such a transfer, therefore, cannot and does not result in vesting of the flat <\/p>\n<p>       in such nominee.  Hence such nominee is merely a trustee for the estate of<br \/>\n       the deceased.  The Society is not concerned with the dispute amongst the<br \/>\n       heirs of the deceased.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_38\"><p>    13.The provision pursuant to the amendment of the <a href=\"\/doc\/1353758\/\" id=\"a_11\">Companies Act<\/a> is quite<br \/>\n       the contrary.  The nomination under <a href=\"\/doc\/108006076\/\" id=\"a_12\">Section 109A<\/a> of the Co-operative Act <\/p>\n<p>       does not entail mere payment of the amount of  shares.  It specifically vests<br \/>\n       the property in the shares in the nominee, in the event of the death of the<br \/>\n       holder of the shares.  The analogy drawn from the judgment in the case of <\/p>\n<p>       Sarbati Devi is completely misplaced.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_39\"><p>    14.The   meaning   and   definition   of   the   word   &#8220;Vest&#8221;   is   required   to   be<br \/>\n       considered.   Black&#8217;s   Law   Dictionary   8th  Edition   at   page   1594   shows   the <\/p>\n<p>       meaning of &#8220;Vest&#8221; thus:-\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_40\"><p>                     &#8220;Vest:1. To confer ownership of (property) upon a person.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_41\"><p>                           2. To invest (a person) with the full title to property.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_42\"><p>                           3. To give (a person) an immediate, fixed right of present<br \/>\n                           or future enjoyment.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_43\"><p>                           4. Hist. To put (a person) into possession of land by the<br \/>\n                           ceremony of investiture.\n<\/p><\/blockquote>\n<p><span class=\"hidden_text\" id=\"span_16\">                                                                  ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_17\">                                                 10<\/span><\/p>\n<blockquote id=\"blockquote_44\"><p>                     Vested:   Having   become   a   completed,   consummated   right   for<br \/>\n                     present   or   future   enjoyment;   not   contingent;   unconditional;<br \/>\n                     absolute <a>.&#8221;\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_45\"><p>       Further the meaning of vested right is given in the aforesaid Dictionary at <\/p>\n<p>       page 1349 thus:-\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_46\"><p>                  &#8220;Vested right. A right that so completely and definitely belongs to a<br \/>\n                  person   that   it   cannot   be   impaired   or   taken   away   without   the  <\/p>\n<p>                  person&#8217;s consent&#8221;.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_47\"><p>    15.The meaning of Vested Interest in the said Dictionary is explained at page <\/p>\n<p>       829 thus:-\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_48\"><p>              &#8220;Vested interest. An interest the right to the enjoyment of which,  <\/p>\n<p>              either   present   or   future,   is   not   subject   to   the   happening   of   a<br \/>\n              condition precedent&#8221;.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_49\"><p>    16.The meaning of Vested Estate at page 588 is shown thus:-\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_50\"><p>                  &#8220;Vested estate.   An estate with a present right of enjoyment or a<br \/>\n                  present fixed right of future enjoyment.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_51\"><p>    17.Advanced  Law   Lexicon   by  P.  Ramanatha Aiyar  3rd  Edition  2007   at   page<br \/>\n       2677 when explains the term Vested Legacy thus:-\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_52\"><p>                  VESTED LEGACY. A legacy the interest in which is so fixed as to be<br \/>\n                  transmissible to the personal representative of the legatee.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_53\"><p>    18. The judgment in the case of The Fruit &amp; Vegetable Merchants Union Vs.<br \/>\n       The Delhi Improvement Trust, A.I.R. 1957 SC 344 at page 353  holds<br \/>\n       that the word &#8220;Vest&#8221; can be used differently upon considering the English<br \/>\n       Law.\n<\/p><\/blockquote>\n<p><span class=\"hidden_text\" id=\"span_18\">                                                                  ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_19\">                                                11<\/span><\/p>\n<blockquote id=\"blockquote_54\"><p>    19.It is observed that the word &#8220;Vest&#8221; is a word of variable import even under <\/p>\n<p>       Indian Statutes.  The illustrations given in the judgment are the <a href=\"\/doc\/393016\/\" id=\"a_13\">Insolvency<br \/>\n       Act<\/a> which provides that the property vests in the Receiver. Such vesting is <\/p>\n<p>       held   to   be   temporary   and   only   for   the   purpose   of   management   of   the<br \/>\n       properties of the insolvent for payment of his debts after distributing his <\/p>\n<p>       assets.  Consequently, the Receiver would have no interest of his own in the<br \/>\n       property   vested  in   him.     The   vesting   under   the   <a href=\"\/doc\/7832\/\" id=\"a_14\">Land   Acquisition   Act<\/a>   is<br \/>\n       shown to be different.  Under that Act the property would vest &#8220;absolutely <\/p>\n<p>       in the Government free from all encumbrances&#8221;.  Hence upon such vesting <\/p>\n<p>       the  property acquired becomes the  property of the  Government  without<br \/>\n       any   conditions   or   limitation   either   as   to   its   title   or   possession.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_55\"><p>       Consequently, it is held at page 353 runs thus:-\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_56\"><p>                    &#8220;It would thus appear that the word &#8220;vest&#8221; has not got a fixed  <\/p>\n<p>                 connotation, meaning in all cases that the property is owned by the<br \/>\n                 person or the authority in whom it vests.  It may vest in title, or it  <\/p>\n<p>                 may vest in possession, or it may vest in a limited sense, as indicated<br \/>\n                 in the context in which it may have been used in a particular piece of<br \/>\n                 legislation.&#8221;\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_57\"><p>    20.Hence   under   that   judgment   which   considered   the   provisions   of   theU.P.<br \/>\n       Town Improvement Act it was held that the land vesting in the Municipal<br \/>\n       or Legal Body was so vested only for the purpose of managing that land <\/p>\n<p>       and would not transfer ownership of the property to the Authority.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_58\"><p>    21.In the case of Dr. M. Ismail Faruqui Vs. Union of India A.I.R. 1995 S.C.<br \/>\n       605 the concept of vesting the property in the Acquiring Authority came to <\/p>\n<p><span class=\"hidden_text\" id=\"span_20\">                                                                  ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_21\">                                                   12<\/span><\/p>\n<p>       be considered under the Acquisition of Certain Area at Ayodhya Act (33 of<br \/>\n       1993). Considering the pith and substance of the Act, which was for the <\/p>\n<p>       acquisition of the property at Ram Janma Bhoomi-Babri Masjid site under a<br \/>\n       legislation,   it   was   held   that   vesting   of   the   disputed   land   (Ram   Janma <\/p>\n<p>       Bhoomi-Babri Masjid) was limited to holding it by the Civil Government as<br \/>\n       Statutory   Receiver   and   vesting   of   the   area   in   excess   of   the   disputed <\/p>\n<p>       structure was absolute.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_59\"><p>           Hence,   it   is   seen   that   the   intention   of   the   Legislature   is   of   primary<br \/>\n       importance   in   considering   the   effect   of   the   term   &#8220;vest&#8221;   in   a   given <\/p>\n<p>       legislation.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_60\"><p>    22.In the case of Municipal Corporation of Greater Bombay Vs. Hindustan <\/p>\n<p>       Petroleum Corporation (2001) 8 SCC 143 the vesting of  watercourse in<br \/>\n       the Municipal Corporation was held not to be except for entrustment of<br \/>\n       the   duty   of   the   Municipality   to   maintain   them   in   the   manner   provided <\/p>\n<p>       under Section 220A of the Bombay Municipal Corporation Act, 1888.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_61\"><p>       This would be in consonance with the intention of the legislation &#8211; no land <\/p>\n<p>       can   become   of   the   ownership   of   the   Municipality   merely   because   the<br \/>\n       Municipality   is   enjoined   to   maintain   it   and   for   which   the     vesting   in<br \/>\n       possession alone would take place; the ownership would not vest.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_62\"><p>    23.Considering   some   of   these   judgments   it   has   been   held   in   the   case   of<br \/>\n       Bharat Coking  Coal  Ltd. Vs. Karam Chand  Thapar &amp; Bros. 2002 (8)<br \/>\n       SCALE 388  that the term vest in common English acceptation would mean<br \/>\n       and imply  conferment  of  ownership  of properties upon a  person  and  in <\/p>\n<p><span class=\"hidden_text\" id=\"span_22\">                                                                     ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_23\">                                                  13<\/span><\/p>\n<p>       similar   vein   it   gives   immediate   and   fixed   right   of   present   and   future<br \/>\n       enjoinment.  However,  it is observed, following the decision in the case of <\/p>\n<p>       Fruit and Vegetables  (supra) and  Dr. M     Faruqui  (supra) that the term<br \/>\n       vest is a word of variable   import.   In that judgment the right, title and <\/p>\n<p>       interest of the Coke oven plant which is vested in the Central Government<br \/>\n       under the <a href=\"\/doc\/7751\/\" id=\"a_15\">Coking Coal Mines (Nationalisation) Act<\/a>, 1972 was considered.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_63\"><p>       In   that   case   the   Appeal   of   the   Company,   in   which   the   right,   title   and<br \/>\n       interest of the owners of the plants were to have vested under the aforesaid<br \/>\n       legislation, was dismissed holding that pursuant to the legislation the right, <\/p>\n<p>       title and interest could not stand transferred to the Government Company <\/p>\n<p>       since no infraction by the title holders was seen.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_64\"><p>    24.In   the   light   of   these   judgments   <a href=\"\/doc\/1353758\/\" id=\"a_16\">Section   109A<\/a>   of   the   Companies   Act   is<br \/>\n       required to be interpreted with regard to the vesting of the shares of the<br \/>\n       holder of the shares in the nominee upon his death.  The act sets out that <\/p>\n<p>       the nomination has to be made during the life time of the holder as per <\/p>\n<p>       procedure prescribed by law.   If that procedure is followed, the nominee<br \/>\n       would become entitled to all the rights in the shares to the exclusion of all <\/p>\n<p>       other   persons.     The   nominee   would   be   made   beneficial   owner   thereof.<br \/>\n       Upon   such   nomination,   therefore,   all   the   rights   incidental   to   ownership<br \/>\n       would follow.   This would include the right to transfer the shares, pledge <\/p>\n<p>       the shares or hold the shares.  The specific statutory provision making the<br \/>\n       nominee entitled to all the rights in the shares excluding all other persons<br \/>\n       would show expressly the legislative intent.   Once all other persons are<br \/>\n       excluded   and   only   the   nominee   becomes   entitled   under   the   statutory<br \/>\n       provision to have all the rights in the shares none other can have it. Further <\/p>\n<p><span class=\"hidden_text\" id=\"span_24\">                                                                    ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_25\">                                                14<\/span><\/p>\n<p>       <a href=\"\/doc\/220452\/\" id=\"a_17\">Section 9<\/a>.11 of the <a href=\"\/doc\/531893\/\" id=\"a_18\">Depositories Act<\/a> 1996   makes the nominee&#8217;s position<br \/>\n       superior to even a testamentary disposition.   The non-obstante Clause in <\/p>\n<p>       <a href=\"\/doc\/220452\/\" id=\"a_19\">Section   9<\/a>.11.7   gives   the   nomination   the   effect   of   the   Testamentary<br \/>\n       Disposition itself.   Hence, any other disposition or nomination under any <\/p>\n<p>       other law stands subject to the nomination made under the <a href=\"\/doc\/531893\/\" id=\"a_20\">Depositories<br \/>\n       Act<\/a>.   <a href=\"\/doc\/220452\/\" id=\"a_21\">Section 9<\/a>.11.7 further shows that the last of the nominations would <\/p>\n<p>       prevail.   This shows the revocable nature of the nomination much like a<br \/>\n       Testamentary Disposition.   A nomination can be cancelled by the holder<br \/>\n       and another nomination can be made.   Such later nomination would be <\/p>\n<p>       relied upon by the Depository Participant.  That would be for conferring of <\/p>\n<p>       all the rights in the shares to such last nominee.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_65\"><p>    25.A   reading   of   <a href=\"\/doc\/1353758\/\" id=\"a_22\">Section   109A<\/a>   of   the   Companies   Act   and   9.11   of   the<br \/>\n       <a href=\"\/doc\/531893\/\" id=\"a_23\">Depositories   Act<\/a>   makes   it   abundantly   clear   that   the   intent   of   the<br \/>\n       nomination   is   to   vest   the   property   in   the   shares   which   includes   the <\/p>\n<p>       ownership rights thereunder in the nominee upon nomination validly made <\/p>\n<p>       as  per  the procedure prescribed,, as  has been done in this  case.    These<br \/>\n       Sections are completely different from <a href=\"\/doc\/610691\/\" id=\"a_24\">Section 39<\/a> of the Insurance Act set <\/p>\n<p>       out   (supra)   which   require   a   nomination   merely   for   the   payment   of   the<br \/>\n       amount under the Life Insurance Policy without confirming any ownership<br \/>\n       rights in the nominee or under Section 30 of the Maharashtra Co-operative <\/p>\n<p>       Societies Act which allows the Society to transfer the shares of the member<br \/>\n       which would be valid against any demand made by any other person upon<br \/>\n       the   Society.     Hence   these   provisions   are   made   merely   to   give   a   valid<br \/>\n       discharge to the Insurance Company or the Co-operative Society without<br \/>\n       vesting  the   ownership   rights  in   the   Insurance   Policy   or   the   membership <\/p>\n<p><span class=\"hidden_text\" id=\"span_26\">                                                                 ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span><br \/>\n<span class=\"hidden_text\" id=\"span_27\">                                                15<\/span><\/p>\n<p>      rights in the Society upon such nominee.   The express legislature intent<br \/>\n      under   <a href=\"\/doc\/1353758\/\" id=\"a_25\">Section   109A<\/a>   of   the   Companies   Act   and   <a href=\"\/doc\/1549225\/\" id=\"a_26\">Section   9<\/a>.11   of   the <\/p>\n<p>      <a href=\"\/doc\/531893\/\" id=\"a_27\">Depositories Act<\/a> is clear.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_66\"><p>    26.Since the nomination is shown to be correctly made by her husband who<br \/>\n      was the holder of the Suit shares, the Plaintiff would have no right to get <\/p>\n<p>      the   shares   of   her   deceased   husband   sold   or   to   otherwise   deal   with   the<br \/>\n      same.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_67\"><p>    27.Consequently the Notice of Motion is dismissed.\n<\/p><\/blockquote>\n<blockquote id=\"blockquote_68\"><p>                                                                (SMT. ROSHAN DALVI, J.)<\/p>\n<p><span class=\"hidden_text\" id=\"span_28\">                                                                 ::: Downloaded on &#8211; 09\/06\/2013 15:51:51 :::<\/span>\n <\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"<p>Bombay High Court Harsha Nitin Kokate vs The Saraswat Co-Op. Bank Ltd. &amp; &#8230; on 20 April, 2010 Bench: R. S. Dalvi 1 MNM IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION NOTICE OF MOTION NO. 2351 OF 2008 IN SUIT NO. 1972 OF 2008 Harsha Nitin Kokate &#8230;Plaintiff Vs. The [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[11,8],"tags":[],"class_list":["post-248764","post","type-post","status-publish","format-standard","hentry","category-bombay-high-court","category-high-court"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Harsha Nitin Kokate vs The Saraswat Co-Op. 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