I would like to contribute to the thoughts as I perceive to be correct. First of all, nominations and entitlements are different. Nomination is only the authority to receive the benefit. In PF, only family members defined under Scheme, 1952 can be nominated. The nominees may or may not be the actual persons entitled to receive the benefits. The said nominees are legally bound to part with the amount to the persons legally entitled. If they do not, then the legal heirs/successors can sue them and recover from them.
The decisions of courts of law cited by all learned members are pertaining to the second aspect of the issue, i.e., who are entitled to ultimately receive and enjoy the benefits as legal heirs/successors. It depends on the personal law of the parties in non-testamentary succession. As an employer, if the nomination is valid, the payment to the said nominee discharges his obligation. But if no nomination exists or is invalid, then the employer may require a legal heirship certificate/succession certificate to ascertain who is actually entitled to receive the benefits.
The rules under EPF Scheme, 1952 guide the way forward in many situations. Rule 61 deals with nominations. Proviso to Rule 61(3) says, "a fresh nomination shall be made by the member on his marriage, and any nomination made before such marriage shall be deemed invalid." There are two parts to this rule - one mandates the member to make a fresh nomination after marriage, and the second invalidates the earlier nomination if one such nomination is made.
The interpretation of this proviso is relevant and assumes great significance. One view is that only if such a fresh nomination is made by the member after marriage, the earlier nomination will become invalid; otherwise, it will be valid. The other view is that marriage makes the earlier nomination invalid, and it is mandatory for the member to file a fresh nomination after marriage. I go with the latter view.
According to me, there is a purpose behind inserting a proviso to Rule 61(3), which is a mandatory action by the member after marriage; otherwise, the said proviso will become nugatory, and the legislative intention is to make a fresh decision by the member. If this proviso is read as "not making the earlier nomination invalid despite marriage," then there was no need for putting this proviso in the statute book as the change of nomination by the member is already provided in 61(5).
I have not found any judgment on this aspect in either way. If anybody has, the same may be shared, and a view may be taken accordingly. Now in the case of no valid nomination, Rule 70(ii) applies. It says the payment shall be made to the family members in equal shares. You may need a family membership certificate issued by the authority, but take care to see that a major son is excluded, married daughter is excluded, etc., mentioned in the proviso to Rule 70(ii). PF Rules take care of most situations.
Lastly, Rule 70(iii) says if otherwise, payment shall be made to the persons legally entitled. In this scenario, the employer needs to have a legal heirship certificate/succession certificate for disbursement.
From India, New Delhi
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The decisions of courts of law cited by all learned members are pertaining to the second aspect of the issue, i.e., who are entitled to ultimately receive and enjoy the benefits as legal heirs/successors. It depends on the personal law of the parties in non-testamentary succession. As an employer, if the nomination is valid, the payment to the said nominee discharges his obligation. But if no nomination exists or is invalid, then the employer may require a legal heirship certificate/succession certificate to ascertain who is actually entitled to receive the benefits.
The rules under EPF Scheme, 1952 guide the way forward in many situations. Rule 61 deals with nominations. Proviso to Rule 61(3) says, "a fresh nomination shall be made by the member on his marriage, and any nomination made before such marriage shall be deemed invalid." There are two parts to this rule - one mandates the member to make a fresh nomination after marriage, and the second invalidates the earlier nomination if one such nomination is made.
The interpretation of this proviso is relevant and assumes great significance. One view is that only if such a fresh nomination is made by the member after marriage, the earlier nomination will become invalid; otherwise, it will be valid. The other view is that marriage makes the earlier nomination invalid, and it is mandatory for the member to file a fresh nomination after marriage. I go with the latter view.
According to me, there is a purpose behind inserting a proviso to Rule 61(3), which is a mandatory action by the member after marriage; otherwise, the said proviso will become nugatory, and the legislative intention is to make a fresh decision by the member. If this proviso is read as "not making the earlier nomination invalid despite marriage," then there was no need for putting this proviso in the statute book as the change of nomination by the member is already provided in 61(5).
I have not found any judgment on this aspect in either way. If anybody has, the same may be shared, and a view may be taken accordingly. Now in the case of no valid nomination, Rule 70(ii) applies. It says the payment shall be made to the family members in equal shares. You may need a family membership certificate issued by the authority, but take care to see that a major son is excluded, married daughter is excluded, etc., mentioned in the proviso to Rule 70(ii). PF Rules take care of most situations.
Lastly, Rule 70(iii) says if otherwise, payment shall be made to the persons legally entitled. In this scenario, the employer needs to have a legal heirship certificate/succession certificate for disbursement.
From India, New Delhi
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