Framework For Release Of Original Movable/Immovable Property Documents/Title Deed Of Deceased Mortgagor (Sole/Joint) To Legal Heirs In Borrowal Account

FRAMEWORK FOR RELEASE OF ORIGINAL MOVABLE/ IMMOVABLE PROPERTY DOCUMENTS/TITLE DEED OF DECEASED MORTGAGOR (SOLE/ JOINT) TO LEGAL HEIRS IN BORROWAL ACCOUNT

In event of death of mortgagor (sole/ joint), the original property documents have to be released in favour of Legal heirs, (or any one of them as mandated by all the legal heirs) after adjustment of loan, on verification of the authority of the legal heirs and proof of the death of the mortgagor. Bank shall release all the original property documents only after full repayment/settlement of all claims/dues outstanding against deceased mortgagor. Legal heirs will be bound by the terms of the sanction and other documents executed by the deceased mortgagor for creation of mortgage of the property in favour of the Bank.

1. Objective

The main objective of the framework is to ensure that only the rightful claimants (legal heirs) get the original property documents belonging to the deceased individual mortgagor in accordance with law. Prompt and speedy settlement of claims will facilitate enhancing the image of our bank and strengthen our bond with surviving family members.

2. Important Definitions

2.1.1 Legal representation: The term includes Court Order such as Probated Will, Letter of Administration or Succession Certificate, empowering certain person(s) to collect the assets due to the deceased. Bank to act as per the Legal representation. Types of Legal representation is explained hereunder:

2.1.1.1. Probated Will: It is a copy of the Will certified under the seal of the Court of competent jurisdiction confirming that the Will has been duly executed and has the force to be acted upon. It is the legal process/court order administering the estate of a deceased person by resolving all claims and distributing the deceased person`s property under a valid Will.

2.1.1.2. Letter of Administration: Where there is no Will or when a person dies leaving a Will without appointing an Executor or if an executor appointed by a Will is legally incapable or refuses to act or has died before the testator or before he has proved the Will, an Administrator can be appointed by a Competent Court as distinguished from an executor who can be appointed by a person by his Will or codicil.

Succession Certificate: It is a Certificate/order issued by a Court of competent jurisdiction declaring the names of legal heirs of a deceased person and percentage of their share in the property of the deceased. A succession certificate is a document which gives authority to a person named in the document to collect "debts and securities" (i.e. credit balances & transferable securities) due to deceased person.

3. Procedure for release of original property documents to Legal heirs

3.1. Release of original property documents/title deed to legal heirs without Legal Representation

For the purpose of release of original property documents/title deed without production of Legal representation (such as Probated Will, Letter of Administration or Succession Certificate), bank has not prescribed any lower or upper limit with regard to loan exposure or value of the mortgage property. Therefore, if the Incumbent in- charge is satisfied that the legal heirs are identifiable and that there is no dispute amongst them in respect of the claim of property documents which is originally in the name of the mortgagor and deposited by the mortgagor with the Bank, there is no necessity for asking legal representation. The claim can be settled by the Competent Authority (as detailed in para no. 5 `Delegation of power`) on the basis of Indemnity Bond with surety.

However, confidential enquiry should be made by the branch about the legal heirs of the deceased mortgagor and while doing enquiry, the branch may also consider documents/ information pertaining to legal heirs available in the bank record. Keeping in view the outcome of the confidential enquiry, if there appears to be no dispute amongst the legal heirs and all are ready to join in release of property documents, the same may be released in favour of legal heirs against Indemnity Bond with surety (Specimen of the `Indemnity bond with Surety` are given at Annexure B) . In case legal heirs have given the mandate to the Bank for release of original property documents/ title deed to one of the legal heirs, then letter of authority in this regard may be obtained from all the legal heirs except the legal heir in whose favour mandate has been given.

In the event of death of one (or more but not all) of the joint owner(s) of property/mortgagor, the property documents shall be released jointly to the survivor(s) and the legal heir(s) of the deceased owner of the property (or any one of them as mandated by all of them) against their joint claim on verification of the authority of legal heirs and proof of death of the deceased person/owner(s) of property.

In the event of death of both / all joint owner(s) of the property, the property documents shall be released jointly to the legal heirs of all the deceased owner(s) of the property (or any of them as mandated by all other legal heirs) on verification of authority of the legal heirs and proof of death of the deceased person/owner(s) of the property.

3.1.1 The Claimants shall submit the duly executed application in the format (Annexure -A) prescribed by the Bank along with the following documents, when a claim for the property documents is made by him/her:

(a) Death Certificate Issued by Competent Authority*;

(b) Photograph and Proof of identification of Legal heirs viz., Election ID Card, Aadhar Card, Passport, Driving License copy or any other proof of identification acceptable to the Bank.

*Where the mortgagor is a Non-Resident or staying abroad has passed away abroad, the death certificate issued outside India/ abroad will have to be attested by one or more of the following:

(i)Notarized by a Notary Public

(ii) Indian Embassy or High Commission / Bank`s Foreign Office of that country where the death has occurred or such country`s Embassy or High Commission in India.

(iii) Apostilled/ Consularised

(c) Indemnity Bond with surety is required

(d) Letter of Authority of legal heir(s) wherever applicable.

Branch shall obtain receipts from claimant in the format prescribed (Annexure D). Further, Branch shall obtain letter of authority to receive document in the format prescribed (Annexure C) in case mandate is given by legal heirs, if required.

Letter of Authority duly notarized /attested may be executed by the legal heirs in favour of one of the legal heirs authorizing him/her to lodge claim, execute documents, receive the property documents, etc. However, the branch should verify the identity of the executants of Letter of Authority to its satisfaction before acting thereon.

The Branch should exercise due care and caution in ascertaining the identity of the legal heirs and the fact of death of the mortgagor through appropriate documentary evidence;

In case there is any dispute amongst the legal heirs or all the legal heirs do not join in the claim of original property documents/title deeds and/or in indemnifying the bank or if the claimant (s) is not willing to provide third party indemnity/ surety or in any other case where there is reasonable doubt regarding the authenticity of the claimant(s) of their being the only legal heir(s) of the deceased mortgagor, Legal Representation shall be asked from the claimants.

When a Legal Representation/Court order is produced, Bank is bound to release property documents to the persons mentioned therein as per terms of legal representation after complying with all the formalities prescribed by the Bank. Bank gets valid discharge by releasing the property documents in favour of such persons.

3.2.1 The Claimants shall submit the duly executed application in the format prescribed by the Bank (Annexure A) along with the following documents, when a claim for the property documents is made by him/her:

(a) Death Certificate Issued by Competent Authority*;

(b) Original Succession Certificate OR Probated Will OR Letter of Administration or any other court order from the Competent Court (as applicable)

(c) Photograph and Proof of identification of Claimant viz., Election ID Card, Aadhar Card, Passport, Driving License copy or any other proof of identification acceptable to the Bank.

*Where the mortgagor is a Non-Resident or staying abroad has passed away abroad, the death certificate issued outside India/abroad will have to be attested by one or more of the following modes:

(i) Notarized by a Notary Public

(ii) Indian Embassy or High Commission / Bank`s Foreign Office of that country where the death has occurred or such country`s Embassy or High Commission in India.

(iii) Apostilled or Consularised

It is clarified that no Indemnity Bond or surety is required in this case. Branch shall obtain receipts from claimant in the format prescribed (Annexure D).

4. Other Guidelines

4.1. Wills, Probates, Letters of Administration - Probates, Letters of administration, Succession Certificates, Court orders appointing Receivers, etc. as and when submitted to the bank must be carefully examined. Under Section 273 of the Indian Succession Act, probates and letters of administration have effect over all the property and estate, movable and immovable of the deceased throughout the Statein which these are granted. These probates/letters of administration do not have effect outside the State unless these are granted (a) by a High Court, or (b) by a District Judge, where the deceased, at the time of his death, had a fixed place of abode within the jurisdiction of the Judge and the Judge certifies that the value of the property and estate beyond the limits of the State does not exceed Rs. 10,000/-. These provisions, however, do not apply to Succession Certificate which will have effect throughout India (Section 380 of the Indian Succession Act, 1925).

4.2.Legally established title (Verification of Succession Certificate / Letters of Administration / Probate) - When Succession Certificate / Letters of Administration / Probate or any other Court order is produced, the genuineness of the document be checked. If need be, Court records be inspected personally or through a Counsel. It can also be verified from the website of the Court concerned. If the inspection is done personally, a report to that effect be kept on record. If done through counsel, a report be obtained from the counsel and be kept on record. If the order produced is not genuine, FIR be lodged with the police. Where claim is settled on the basis of Succession Certificate / Letters of Administration / Probate then in such case it is not required to obtain indemnity / surety from the claimant. A letter of request and certified copy of the Succession Certificate / Letters of Administration / Probate issued by the Court be kept on record.

4.3.Claim based on `Will` - In case the deceased mortgagor has left a `Will`, the branch may ask for probate of the `Will`. However, if that is not feasible and if the facts are not complicated, all the legal heirs may be asked to confirm the genuineness of the Will and that they (legal heirs) have no objection for settling of the claim in terms of the Will by executing a suitable declaration duly attested by notary or magistrate. While examining the `Will`, it should be verified that the `Will` has been attested by at least two witnesses. Copy of the `Will` submitted by the claimant(s) be verified with the original and the fact of such verification with the original be recorded on the copy and the original `Will` be returned against proper acknowledgment signed by the legatee i.e. the person in whose favour the `Will` has been executed.

While examining a `Will` submitted in support of the claim, the following aspects be also taken care of: -

· Find out who is / are the legatee(s) under the `Will` entitled to the claim.

An affidavit of the attesting witnesses, affirming that the `Will` was executed in their presence by the deceased while he/she was in sound mind and with free will without any coercion or undue influence, be obtained and kept on record.

· An affidavit from the claimant(s) be obtained and kept on record to the effect that the `Will` submitted and relied upon in support of his / their claim is the last `Will` of the deceased and that no litigation challenging the `Will` is pending in any Court.

4.4.Entry with regard to release of property documents shall be made in Mortgage Register on the date of release of property documents by Incumbent in charge of Branch where loan account was serviced and copy of claim form along with receipt from claimant be held in record.

5. Competent Authority for release of original property documents/ title deed