By Avikshit Moral & Mustafa Motiwala
Indians today are more mobile than ever before, migrating to most parts of the world. Asset ownership across borders is also becoming a common phenomenon. And with that comes a set of new challenges for such individuals. We intent to clarify a few issues relating to asset management by way of making a Will, for Non Resident Indians (NRI).
Definition of ‘Will’:
The term ‘Will’ is defined under ‘Section 2(h)’ of the “Indian Succession Act, 1925” (Act), means the legal declaration of the intention of a testator with respect to his property which he desires to be carried into effect after his death. A testator is authorized with a power to appoint any person as beneficiary of his Will.
Should NRIs make a Will?
Making a Will is not a mandatory requirement. However, if a person dies without making a Will, his family will have to follow the ‘laws of intestate succession’ in deciding how to distribute the assets.
In India, Hindus, Sikhs and Jains are covered by the Hindu Succession Act 1956. With the exception of Muslims, everyone else is governed by the Indian Succession Act 1925. Muslims are mainly governed by the Muslim personal law.
If any person dies intestate, which is without a Will, the law of natural succession will prevail. According to the law of natural succession a person’s property shall devolve equally on all his legal heirs if such heirs are Class 1 heirswho are primarily parents, wife and children and if he has no Class 1 then Class 2 which are immediate blood relation and so on, according to specified list. In Muslim law not more than 1/3 of the property can be bequeathed by way of testamentary powers. The rest is devolved equally on all the legal heirs.
Therefore, it is preferable to make a Will because it allows the testator to decide how his wealth is to be distributed and used.
Should a NRI make separate wills?
‘Section 5’ of the Act deals with the law regulating succession to deceased person’s moveable and immovable property. This section provides that succession to immovable property/ies in India of a person deceased shall be regulated by the laws of India wherever such person may have had his domicile at the time of his death. Thus, it is advisable that a Will dealing with properties in India is made in India. Another reason for executing a Will in India is that a Will executed out of India must qualify in India and meet the provisions of the local practice (as is setout hereunder) as also the applicable religious law.
A person residing out of India who owns properties in different countries should make a separate will for the Indian properties and all the properties should not be clubbed in a single Will.
General procedure to make a ‘Will’:
A ‘Will’ should be prepared with utmost care and must contain several parts to make a complete Will though there is no defined format for making a Will. However, a general procedure should be adopted while writing a Will by the testator which includes:
1. Declaration In The Beginning: In the first paragraph, person who is making a Will, has to declare that he is making this Will in his full senses and free from any kind of pressure and undue influence and he has to clearly mention his full name, address, age etc. at the time of writing the Will so that it confirms that a person really wishes to write a Will.
2. Details of Property and Documents: The next step is to provide list of items and their current values, like house, land, bank fixed deposits, postal investments, mutual funds, share certificates owned by testator. He must also state the place where he has kept all the documents if the will documents are under safe custody of the bank then testator has to write details about the releasing of the Will from the bank. Here it is the most important duty of the testator to communicate the above matter to the executor of the Will or any other family members, which will make the Will valid after testator death.
3. Details of ownership by the Testator: A testator while making a Will should specifically mention that who should own his entire property or assets so that it will not affect the interest of the successors after his death. If testator wishes the name of the minor as beneficiary then a custodian of the property should be appointed to manage the property.
4. Attestation of the ‘Will’: At the end, once the testator completes writing his Will, he must sign the will very carefully in presence of at least two independent witnesses (not being beneficiaries under the will), who have to sign after his signature, certifying that the testator has signed the Will in their presence. The date and place also must be indicated clearly at the bottom of the Will. It is not necessary that a person should sign all the pages of the Will instrument but he must sign to avoid any legal disturbances. In the event the person making the will is in an advance stage of his life it is always suggested that his health and mental condition is certified by a doctor and such certificate is attached to the will.
5. Execution of a ‘Will’: On the death of the testator, an executor of the Will or an heir of the deceased testator can apply for probate. The court will ask the other heirs of the deceased if they have any objections to the Will. If there are no objections, the court will grant probate. A probate is a copy of a Will, certified by the court. A probate is to be treated as conclusive evidence of the genuineness of a Will. In case any objections are raised by any of the heirs, a citation has to be served, calling upon them to consent. This has to be displayed prominently in the court. Thereafter, if no objection is received, the probate will be granted and it is only after that Will comes into effect. The provisions relating to probate is explained below.
Registration of ‘Wills’:
Registration of a Will is not compulsory, however, it is advisable to register a will. Once a Will is registered, it is strong legal evidence that the proper parties had appeared before the registering officers and the latter had attested the same after. The process of registration begins when a Will instrument is deposited to the registrar or sub-registrar of jurisdictional area by the testator himself or his authorized agent. Once the scrutiny of Will instrument is done by the registrar and registrar is satisfied with all the documents then registrar will make the entry in the Register-Book by writing year, month, day and hour of such presentation of the document and will issue a certified copy to the testator.
When a NRI who dies intestate having properties in India, his foreign lawyer would need to take the following steps:
- Appoint a local lawyer in the state where the property is located within India;
- Provide the local Indian lawyer with the documents as may be required for obtaining letters of administration and a list of the deceased’s heirs and next of kin; and
- Accordingly, an application will have to be made by any person who, according to the rules for distribution of the estate applicable in the case of such deceased, would be entitled to the whole or any part of the deceased’s estate through a local lawyer. All the requited documents, including proof of the beneficiary’s connection with the deceased (and such other documents that the local lawyer/court thinks necessary) will have to be furnished in the application.