Wills: Unregistered Gift Deeds Not Valid, Rules Bombay HC

Gift deeds will be valid only if they have been registered, the stamp duty paid, and all other formalities completed, the Bombay High Court recently said in a ruling. The ruling came on a battle between two sisters over their mother’s bungalow at a prime location in Chembur.

 

Leena D’Souza, who had claimed her family had been gifted the bungalow by her mother, was stopped from selling or creating any third party rights over the property. The reason: the gift deed, reportedly made in 1985 was registered only in 2009, 10 years after the mother’s death in 1999.

 

Justice Roshan Dalvi rejected Leena’s plea to vacate its interim orders, on a petition filed by the other sister, that the bungalow must come to all heirs, according to the mother’s will. The judge noted that all gift deeds have to be compulsorily registered and it becomes valid only after stamp duty and other formalities are completed.

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PIL Accuses PNB of Corruption in selling insurance
Raises the bigger issue of bancassurance tie-ups at whose cost?
 
If public interesting litigation (PIL) is the only way to force financial regulators to pay attention to consumer grievances, kudos to intrepid activists Dr Nutan Thakur (of Allahabad) and giant-killer ML Sharma (of the ‘Coalgate’ fame) for taking on the issue of mis-selling insurance. They have even achieved a breakthrough by getting the Allahabad High Court to issue notices to Punjab National Bank (PNB), PNB Metlife and the finance ministry to respond to the charges outlined in the plaint. 
 
Interestingly, the plaint does not take on the issue of insurance mis-selling at all. Instead, the petitioners have chosen to term the entire arrangement between PNB and its insurance partner, PNB Metlife, as a corrupt deal by attacking the commissions, gifts, freebies and foreign trips that insurance companies dole out to the staff of their banking partners to aggressively push their products on trusting customers. 
 
All banks have an insurance tie-up and relationship managers for selling products; but the petitioners have taken the plea that regular staff, computers and infrastructure of a nationalised bank are being used for an insurance joint venture, in return for paltry commissions earned on selling insurance. 
 
Mr Sharma’s petition has tried to make out a case of corruption against the Bank’s former chairman and the staff who received the commission. Ironically, while rewards to staff is a known fact, PNB has strangely chosen to deny that any commissions were paid on the sale of insurance by its staff in response to Right to Information (RTI) Act applications. 
 
So the petitioners have obtained tax records and statements of several PNB staffers to contradict the Bank’s claim. They, thus, argued that “an anomalous situation has arisen in which the inputs are borne by the public sector bank and, in turn, by poor masses of the nation but the harvest is being shared by authorities and staff of the Bank.” 
 
In a public sector set up, this is an issue that clearly merits consideration, because the salary, performance assessment and post-retirement benefits are completely different and the private model cannot simply be copied and replicated. 
 
Also, unlike private banks, the government is funnelling funds to recapitalise these banks regularly; hence, there is a valid question about bank staff working almost full time for an insurance subsidiary, using the infrastructure of a government organisation and being entitled to goodies and junkets in addition to their salaries. 
 
One will watch with interest what happens to the petition; but any significant judgement in this case will apply to all nationalised banks with insurance tie-ups. Once again, a court case may end up as the way to shed some light on opaque deals permitted by the banking and insurance regulators which have a direct impact on all consumers and borrowers of banks. 
 
In fact, small borrowers allege that bank officials arm-twist them to buy expensive and needless insurance, to clear loan proposals. While the top management of banks and RBI (Reserve Bank of India) are aware of this nasty practice, they turn a blind eye to it. One retired bank chairman, who headed one of India’s largest nationalised banks, said that there was outrage among his employees when he suggested that the bank should stop selling insurance products because of the loss of goodies.

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COMMENTS

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3 years ago

Wall Street Journal Sep 14: A panel of top regulators Thursday proposed giving MetLife Inc tougher government oversight, bringing the insurer and regulators a step closer to a possible legal showdown.The Financial Stability Oversight Council, led by the Treasury secretary, voted to propose labeling a nonbank financial company as "systemically important," the panel said in a statement released after a closed-door meeting. MetLife acknowledged it was the unnamed firm.The council's move brings MetLife, to so-called SIFI label draws a firm in for oversight by the Federal Reserve and a host of tougher rules, including possibly thicker capital cushions to protect against losses. In a statement, MetLife Chief Executive Steven Kandarian said the firm "strongly disagrees" with the council's action and is "not ruling out any of the available remedies under Dodd-Frank to contest a SIFI designation."

This also brings to note Metlife's unethical practices in many countries. In India, it tried to bulldoze the regulators, appointed a canvassing agent into influence Government policies in Manmohan Singh govt. It canvassed to appoint BCG to Punjab National Bank as evaluation partner who ofcourse recommeded Metlife to PNB and in blatant move Metlife appointed BCG as implementation partner without bothering about conflict of interest drawing scrutiny from Indian regulator, Central controller of Audit and intelligence units. The then Chairman of Board Shailendra Ghorpade protested about blatant violation of code of ethics and conflict he has been summarily terminated from the services of the Company. Shailendra in turn has filed legal case against Metlife citing his case and similar treatment meted to other CEOs such as China, Hongkong, Australia and host of other countries. PNBs corporate agency case hinges on outcome of Allahabad court. After Citibank come out of relationship with Metlife, it is desperate of irrespective of means and whoever protests gets immediate termination.

MetLife has maintained that it is amply capitalized under state insurance-department regulations and that Washington may needlessly drive up product prices and put MetLife at a competitive disadvantage with stiff new capital rules. The firm now has 30 days to decide whether to request a hearing to contest the council's findings.

DEEPAK DANG

3 years ago

If selling the "Third Party Products" & giving incentives to the staff is a corruption then all these products being sold & extending incentives to staff under permission of RBI/MOF is not a case against a particular bank. It is a matter of corruption by all banks & RBI/MOF. If it is a case of Mis-selling of any product then only it is in contravention to policy.

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3 years ago

PNB CMD Kamat and Metlife introduced unethical practices in PNB of mis-selling by introducing foriegn trips, white goods and host of freebies to encourage bank staff to convert FD, RD, Monies lying in Savings accounts of customers to insurance policies misplacing the trust shown by customers to bank staff. In the first six months they metlife did 1100 crores of such illegal business from PNB. At th fear of being exposed by cobrapost, Kamat quitly withdrew the circulars of freebies and tours. Even now in the name of educational trips the pnb staff enjoy exotic holidays in places in Europe and this practice of converting FDs and RDs to insurance policies still continuess to flourish. PNB seems to have forgotten the values meant for public sector banks. CAG can validate this. Metlife has no insurance expertise wherein they burnt capital of 3500cr capital for 1000 cr book - Worst financial management by an insurance Company anywhere in the world. Metlife unfortunately is crooked company devoid of any values or integrity. Lakhs of customers have suffered when metlife in pursuit of showing profits policies for of all things chose to forcefully enforcing lapse of policies to book surrender profits. Metlife is so brazen that to cover themselves from attention of customers by means of not sending Renewal premium notices & fund statements. When the CFO protested to this unethical practice using forceful lapasation and surrender for the purpose declaring profits, he was summarily asked to leave. The appointed actuary is dictated by Metlife to show lower valuation as Metlife intends to buy additional 22% from Indian shareholders as and when FDI allows 49%. There is zero governance in the Board. When shailendra ghorpade, chairman of the Board threatened to go public on the misdoing of Metlife he was summarily sacked. He has filed criminal case against Metlife and the new chairman called Townsend in the court of Newyork where metlife has headquarters. Allahabad court take cognizance of these facts and order for CAG audit as PNB is the largest shareholder and also ask IRDA to inspect issue of surrender profits and wilfully keeping customers not being intimated and in the interim period keep R3 under suspension.

AV Bagur

3 years ago

Excellent. This is the way forward to bring these big bullies who have torn into vitals of ordinary borrowers.

PM Modi's wife Jashodaben files RTI for info on her security cover

Jashodaben also expressed unhappiness over current security set-up, where her guards travel in government vehicles like car, while despite being a PM's wife she has to travel in public transport

 

Prime Minister Narendra Modi's wife Jashodaben has filed an application under the Right to Information (RTI) Act with Mehsana police to seek clarity on security cover given to her. Jashodaben also wants to know what she is entitled to.

 

Mehsana Superintendent of Police (SP) JR Mothalia said that Jashodaben wants to know what her rights are as PM's wife as far as the security aspect is concerned.

 

"Today, she came to our office and filed an RTI to know about her rights as PM's wife with regard to security cover. We will give our written reply to her in stipulated time," said Mothalia.

 

Jashodaben lives with her brother Ashok Modi at Unjha town of Mehsana district. After Modi was sworn-in as PM, she has been given security by Mehasana police.

 

"We have deployed ten of our policemen, including armed guards, for her security. They work in two shifts, five each in one shift." said Police Inspector of Mehsana Special Operations Group (SOG) JS Chavda.

 

In her application, Jashodaben sought several documents from the police department related to her security cover given as per the protocol, including the certified copy of actual order passed by government about providing security.

 

She also wanted to know the laws and related provisions in Indian Constitution about security cover given to a PM's wife.

 

She asked the government to explain the definition of protocol and sought details about what is included under it and what other benefits she is entitled for as per that protocol.

 

She also expressed unhappiness about the current security set-up, where her guards travel in government vehicles like car, while despite being a PM's wife she has to travel in public transport.

 

Jashodaben noted that late Prime Minister Indira Gandhi was killed by her own bodyguards and that she felt scared of her guards. She asked the government to make it compulsory for each guard to produce copy of deployment order.

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