Law: Bombay Co-operative Societies Act (VIII of 1925)

Section: 27

Bombay Co-operative Societies Act (VIII of 1925), S. 27 Person nominated under S. 27 as recipient of member's interests on his death-Not merely an administrator or an executor holding property on behalf of deceased member's heirs-Provisions of Bombay Co-operative Societies Act, 1925-Supersede provisions of personal law-Nominee, held, entitled to property exclusively and absolutely-Provident Funds Act (XIX of 1925), S. 5(l) [Hayatuddin v. Mst. Rahiman and another A I R 1935 Sind 73 dissented from]. It was argued that section 27 of the Bombay Co-operative Societies Act, 1925 provides for the person nominated to be made responsible to the society for the liabilities of the original allottee and the nominee is merely an administrator or an executor and is to hold the property on behalf of the heirs who are otherwise entitled to share under the personal law of the deceased original allottee. An analogy, in support of this argument, was drawn from the Provisions of Provident Funds Act, 1925. Held : Section 3, clause (2), Provident Funds Act, 1925 does not deal with the cases of those persons who are nominated under the Act. The relevant section of the Provident Funds Act, which deals with the rights of the nominees, is section 5(1). It is abundantly clear from a bare reading of the section that according to this statutory provision "notwithstanding anything contained in any law for the time being in force . . . . . . . any nomination duly made in accordance with the rules of the fund, which purports to confer upon any person the right to receive the whole or any part of such sum on the death of the subscriber or depositor, shall be deemed to confer such right absolutely". It is also clear that this right to receive absolutely by the nominee was not intended to refer merely to a right to realise. The words "notwithstanding anything contained in any law for the time being in force" appearing in section 5 of this Act would otherwise be absolutely redundant. Section 27 of the Bombay Co-operative Societies Act, 1925, clearly postulates that on the death of a member of a society such society may within a period of one year from the death of such…