ANJU DEVI JHUNJHUNWAIA Vs. NATIONAL SECURITIES DEPOSITORY LTD.

JUDGEMENT

(1.) PETITIONER No. 1 is widow of Navin Kumar Jhunjhunwaia, who has filed this application for a direction to the respondents National Securities Depository Limited (hereinafter referred to as the N. S.D.) and the Stock Holding Corporation of India for transmission of ail the shares deposited in the name of her husband in her DEMAT Account bearing no. Client ID 13184662. Petitioner 's husband was having various shares and stocks deposited with the respondents under the DEMAT account. He died prematurely on 27.6.2005 leaving behind his wife, petitioner no. 1 and one minor son. The petitioner no. 2 is mother of Late Navin Kumar Jhunjhunwala and she has also joined as petitioner no. 2 in this writ application in order to show that other family members have no objection in case shares of Navin Kumar Jhunjhunwala is transmitted in the DEMAT account of petitioner no. 1.

(2.) IN exercise of the powers conferred under Sec. 26 of the Depository Act, 1996 N.S.D. Limited has made bylaws which have been approved by the Exchange Board of India. These by -laws are called by -laws of NSD Limited. The Board of Directors of Executive Committee of N.S.D. has formulated business rule for the functioning and operation of the depository rules and to regulate the functioning in operation of the participant of the depository. Rule 12.6.2.2. relates to account transfer in case of transmission. The provision under this rule is "The legal heir(s) or the legal representative(s) of such securities shall make an application to the participant in the form specified in Annexure O alongwith the following documents: ''(i) A copy of the death certificate duly notarised, (ii) A copy of the succession certificate duly notarised or an order of court of competent jurisdiction where the deceased has not left a will, or (iii) A copy of the probate or letter of administration duly notarised."

(3.) COUNSEL for the petitioners states that the requirement as per Rule 12.6.2.2 for transmission of the shares in the name of legal heirs is that a copy of duly notarised succession certificate or an order of court of competent jurisdiction be annexed when there is no nomination in favour of application or deceased has not left the will. The petitioners in place of succession certificate has annexed the award of the arbitration tribunal which is a decree under sec. 36 of the Arbitration and Conciliation Act, 1996. The petitioner as such has duly complied the second part of the requirement i.e. an order of a court of competent jurisdiction. The N.S.D. Limited should have transmitted and transferred the shares of her late husband in her DEMAT account. Counsel for the petitioner has further submitted that if any requirement is mentioned under any provision of the law it is for the benefit of the concerned person and it should never be used as a tool for harassing such persons for whose benefit the provision has been made. Reliance has been placed on a decision reported in 2003(3) S.C.C. 272 Paragraph 26.