Partly allowed

Kanjiramannil Leelamma Chacko v. Central Depository Services

Kerala HC7 Apr 2014WP(C)/23197/2013

Case brief

AI extract

What is this about?

Petitioners challenged CDSL's refusal to transfer deceased father's securities without a Succession Certificate. Court upheld CDSL's right but ordered conditional transfer. Petitioners must provide immovable or other equivalent security within 10 days. CDSL liable to release security upon producing Succession Certificate.

What did the court decide?

Respondent 1 to transfer securities if petitioners provide security of immovable property within 10 days; release security to petitioners upon production of Succession Certificate.

Kanjiramannil Leelamma Chacko Vs Central Depository… — Writ and Judicial Review | Kerala HC (2014)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE MR. JUSTICE A.MUHAMED MUSTAQUE

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MONDAY, THE 7TH DAY OF APRIL 2014/17TH CHAITHRA, 1936

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WP(C).No. 23197 of 2013 (Y)

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PETITIONER(S):

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--------------------------

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1. KANJIRAMANNIL LEELAMMA CHACKO, AGED 56 YEARS, WIFE OF LATE SRI. VALIYAMANNIL JOSEPH CHACKO, RESIDING AT HOUSE NO. 2A, 2ND FLOOR, SURYA ENCLAVE, OPP. KENDRIYA VIDYALAYA SCHOOL, ELAMKULAM VILLAGE, GANDHI NAGAR, KADAVANTHRA, KOCHI-682 020.

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2. LIJI ANCY CHACKO, AGED 30 YEARS, DAUGHTER OF LATE SRI. VALIYAMANNIL JOSEPH CHACKO, RESIDING AT HOUSE NO. 2A, 2ND FLOOR, SURYA ENCLAVE, OPP. KENDRIYA VIDYALAYA SCHOOL, ELAMKULAM VILLAGE, GANDHI NAGAR, KADAVANTHRA, KOCHI-682 020.

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3. JIBIN CHACKO, AGED 26 YEARS, SON OF LATE SRI. VALIYAMANNIL JOSEPH CHACKO, RESIDING AT HOUSE NO. 2A, 2ND FLOOR, SURYA ENCLAVE, OPP. KENDRIYA VIDYALAYA SCHOOL, ELAMKULAM VILLAGE, GANDHI NAGAR, KADAVANTHRA, KOCHI-682 020.

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BY ADVS.SRI.P.GOPAKUMARAN NAIR

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SRI.C.S.DIAS SRI.N.K.SUBRAMANIAN SMT.B.BINDU

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RESPONDENT(S):

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1. CENTRAL DEPOSITORY SERVICES (INDIA) LIMITED, REGISTERED OFFICE, 17TH FLOOR, P.J.TOWERS, DALAL STREET, MUMBAI-400 001, REPRESENTED BY ITS INVESTOR RELATION OFFICER.

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2. DBFS SECURITIES LIMITED,

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DEMAT SERVICES, 2ND FLOOR, CHAMMANY CHAMBERS, K.K.ROAD, KALOOR, KOCHI-682 017, REPRESENTED BY ITS DIRECTOR.

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R1 BY SRI. SHIBUNATH.T.A. (PARTY IN PERSON) R2 BY ADV. SRI.B.PREMNATH (E)

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THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 27/03/2014,THE COURT ON 07/04/2014 DELIVERED THE FOLLOWING:

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Kss

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WP(C).No. 23197 of 2013 (Y)

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APPENDIX

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PETITIONER(S)' EXHIBITS:

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EXHIBIT P1- TRUE COPY OF DEATH CERTIFICATE ISSUED BY THE MINISTRY OF PUBLIC HEALTH, STATE OF KUWAIT DATED 12-03-2013.

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EXHIBIT P2- TRUE COPY OF LEGAL HEIRSHIP CERTIFICATE DATED 25-06-2013 ISSUED BY THE TAHSILDAR, KANAYANNUR TALUK.

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EXHIBIT P3- TRUE COPY OF THE KERALA GAZETTE DATED 21-05-2013 VOLUME 2 PART III.

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EXHIBIT P4- TRUE COPY OF HOLDING STATEMENT DATED 16-07-2013 ISSUED BY THE 2ND RESPONDENT SHOWING THE INVESTMENTS HELD BY THE DECEASED.

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EXHIBIT P5- TRUE COPY OF REPRESENTATION DATED 30-07-2013 SUBMITTED BY THE 1ST PETITIONER TO THE RESPONDENTS.

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EXHIBIT P6- TRUE COPY OF LETTER DATED 07-08-2013 WITH THE RELEVANT EXTRACT OF THE OPERATING INSTRUCTIONS FOR DEPOSITORY PARTICIPANTS FRAMED BY THE 1ST RESPONDENT.

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RESPONDENT(S)' EXHIBITS:

N I L

/TRUE COPY/

P.S.TO JUDGE

Kss

A.MUHAMED MUSTAQUE, J.

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W.P.(C).No.23197 of 2014

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Dated this the 7^th of April, 2014

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J U D G M E N T

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This writ petition is filed for the following reliefs:

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“i. Issue a writ of mandamus or any other appropriate writ, order or direction commanding the first respondent to accept Ext.P2 certificate as sufficient and direct the second respondent to transfer the Holdings as per Ext.P4 equally in favour of the petitioners.

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ii. Issue a writ of certiorari or any other appropriate writ, order or direction, quashing sub-clause (B) of clause 7.6.1 of Ext.P6 which insists for production of a succession certificate for transmission of investment exceeding Rs.1 lakh and declare the said clause as inoperative.

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iii. Grant such other reliefs as this Court may deem fit to meet the ends of justice.”

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The first petitioner is the widow of Valiyamannil Joseph

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Chacko and the remaining petitioners are the daughter and son of the above said Chacko.

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The first respondent is a Depository Facilitator, recognised by the Securities and Exchange Board of India (SEBI) under Section 12 of the Securities and Exchange Board of India Act, 1992. The deceased Valiyamannil Joseph Chacko made investments in equity shares and securities of various companies with the first respondent through the second

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W.P.(C).No.23197 of 2014

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-:2:-

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respondent, who is said to be a recognised Depository Participant of the first respondent.

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In this writ petition, the petitioners challenge the inaction of the first respondent in not transferring the Holdings of the deceased in favour of the legal heirs in spite of production of legal heirship certificates issued by the competent authority. The petitioners have also produced Ext.P4 statement to show the Holdings of the deceased.

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Heard the learned counsel for the petitioners and the authorised officer of the first respondent, who appeared in person.

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The authorised officer submits that there was no nominee for

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the deceased and in the absence of nominee, the transfer of title of securities, in case of death of an account holder, shall be in accordance with the regulations framed and produced as Ext.P6 in the writ petition. He refers to the D.P. Operating Instructions, Chapter 7 Transmission, particularly, clause 7.6.1.B with regard to the procedure for transfer on death of sole holder. According to him, to transfer title of securities held by the deceased, the petitioners have to produce transmission request form, original death certificate of the deceased or a copy of the same, (duly notarized/attested by a Gazetted Officer) and either of the following:

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W.P.(C).No.23197 of 2014

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-:3:-

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a) A succession certificate, or

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b) A letter of administration, or

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c) A probate of the will of the deceased.

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Since the petitioners failed to produce either of the three referred documents, the first respondent is not in a position to release the securities held by the deceased in favour of the petitioners or any one among them.

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However, the learned counsel for the petitioners submits with

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reference to clause 7.6.1.B that the first respondent has the power to transmit any amount specified by the Central Depository Services (India) Limited (CDSL) from time to time. Non exercise of this power is arbitrary and with the intention of the withholding the securities of the deceased.

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I have examined the rival contentions of both the parties. I am

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of the definite view that the first respondent is justified in not transferring the title of the securities in favour of the petitioners. The petitioners have to produce documents mentioned as above for transmission. Mere production of legal heirship certificate issued by the competent authority is not

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sufficient to satisfy the regulations relating to transmission.

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However, the learned counsel for the petitioners further submits

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that the petitioners are in immediate requirement of money after liquidating

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W.P.(C).No.23197 of 2014

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securities of the deceased and it may take several months to obtain succession certificate.

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In the view of the urgency as mentioned above, to meet the interest of justice, the following orders are to be passed:

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i. The first respondent shall transfer the account of the deceased to anyone among the petitioners or in the name of all the petitioners based on their request in this regard. The petitioners shall place their request within a period of ten days from the date of receipt of a copy of this judgment.

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ii. Such transfer shall be based on production of security of the immovable property or any other security worth of the Holdings to be transferred based on the request made as mentioned in para.(i).

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iii. The first respondent shall intimate the petitioners the value of the Holdings to be transferred in the name of the petitioners, as per the request made by them in terms of para.(i) so as to enable them to obtain succession certificate and also to furnish security within a week from the date of receipt of a copy of this judgment.

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iv. The valuation of the immovable property by an approved valuer or a chartered valuer can be accepted.

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W.P.(C).No.23197 of 2014

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v. The first respondent need to transfer title of Holdings in favour

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of the petitioners based on their request to be made as per para.(i), only on

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production of security mentioned as above.

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vi. The first respondent shall release the security to the petitioners

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as and when the petitioners produce a succession certificate issued by a competent court.

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The writ petition is disposed of as above.

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Sd/-

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A.MUHAMED MUSTAQUE, JUDGE

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Kanjiramannil Leelamma Chacko v. Central Depository Services

Case brief

What is this about?

What did the court decide?

Kanjiramannil Leelamma Chacko v. Central Depository Services

Case brief

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What did the court decide?

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