INDRANI WAHI versus REGISTRAR OF COOP. SOCIETIES & ORS.
[2016] 4 S.C.R. 307, Supreme Court of India, 2016
Outcome: Disposed off
Segment: Issues
[2016) 4 S.C.R. 307 
INDRANI WAHi 
v. 
REGISTRAR OF COOP. SOCIETIES & ORS. 
(Civil Appeal No. 4646 of2006) 
MARCH 10, 2016 
[JAGDISH SINGH KHEHAR AND C. NAGAPPAN, JJ.] 
West Bengal Co-operative Societies Act, 19R3 - ss. 79 and 80 
r/w rr. 12 7 and 128 of the West Bengal Co-operative Societies Rules, 
1987 - Nomination uls 79 - By a member of a co-operative soci..:ty 
...: In favour of his married daughter - After the death of the original 
member, the membership transferred in the name of the daughter -
Objection to the transfer by the son and wife of the original member 
- Deputy Registrar of Co-operative Societies declined to transfer 
the J11embership in favour of the daughter (nominee) on the ground 
that she being married did not fall within definition of the term 
'family' as contemplated uls 79 rlw r. 12 7 - Writ petition by the 
nominee - Allowed by the Single Judge of High Court - Division 
Bench of the High Court held that the son and wife of the original 
member, being the inheritors, their interest in the property should 
be protected - On appeal, held: Jn case of a valid nomination u/ 
s. 79, the Co-operative Society is liable to tramfer the share or 
interest of a member in the name of the nominee - That would have 
no relevance to the issue of title between the inheritors or successors 
to the property of the deceased member - The Co-operative Society 
is directed to transfer the imerest of the deceased member, in favour 
of the nominee - However, it will be
open to the inheritors to pursue 
their case of succession /inheritance. 
Allowing Civil Appeal No. 4646/2006 and disposing of Civil 
Appeal No. 4930/2006, the Court 
HELD: 1. As per s. 79 of West Bengal Co-operative Societies 
Act, 1983, where a member of a co-operative society nominates 
a person in consonance with the provisions of the West Bengal 
Co-operative Societies Rules, on the death of such member, the 
co-operative society is mandated to transfer all the share or 
interest of such member in the name of the nominee. The above 
interpretation of Section 79 also emerges from Section 80(1)(a) 
which postulates, that the share or interest of a member of the 
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society, "on his death" shall be transferred to a person 
"nominated under Section 79". The rights of others on account 
of an inheritance or succession is a subservient right. Only if a 
member had not exercised the right of nomination under Section 
79, then and then alone, the existing share or interest of the 
member would devolve by way of succession or inheritance. The 
heading of Section 80 - "Disposal of deceased member's share of 
interest" lends further credence to the above interpretation. Rule 
127 of the 1987 Rules also provides, that if a nomination has 
been made by a member under Section 79, the share or interest 
or the value of such share or interest standing in the name of the 
deceased member, would be transferred to the nominee. Rule 
128 of the 1987 Rules further leads to the same inference. 
Inasmuch as Rule 128 provides, that only in the absence of a 
nominee, the transfer of the share or interest of the erstwhile 
member, would be made on the basis of a claim supported by an 
order of probate, a letter of administration or a succession 
certificate (issued by a Court of competent jurisdiction). Thus, in 
case of a valid nomination under Section 79 of the 1983 Act, 'the 
Co-operative Society' is liable to transfer the share or interest of 
a member in the name of the nominee. [Paras 15, 17-19] [322-D-
F; 324-C, F, G] 
2. Transfer of share or interest, based on a nomination under
Section 79 in favour of the nominee, is with reference to the 
concerned Co-operative Society, and is binding on the said society. 
The. Co-operative Society has no option whatsoever, except to 
transfer the membership in the name of the nominee, in 
consonance with Sections 79 and 80 of the 1983 Act (read with 
Rules 127 and 128 of the 1987 Rules). That, ·would have no 
relevance to the issue of title between the inheritors or 
successors to the property of the deceased. The Co-operative 
Society' is directed to transfer the share or interest of the society 
in favour of the appellant. It shall however, be open to the other 
members of the family to pursue case of succession or 
inheritance, if so advised, in consonance with law. [Para 20] (324-
H; 325-A-C] 
Usha Ranjan Bhaltacharjee v. Abinash Chandra 
Chakraborty, (1997) 10 SCC 344, Smt. Sarbati Devi v. 
Smt. Usha Devi 1984 (1) SCR 992 : (1984) 1 SCC 424
INDRANI WAHI v. REGISTRAR OF COOP. SOCIETIES & ORS. 
309 
and Gayatri De v. Mousumi Cooperative Housing Society 
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Limited 2004 (1) Suppl. SCR 56 : (2004) 5 sec 90 -
distinguished. 
Case Law Reference 
(1997) 10 sec 344 
1984 (1) SCR 992 
distinguished 
distinguished 
Para 11 
Para 11 
2004 (1) Suppl. SCR 56 
distinguished 
Para 11 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4646 
of2006. 
From the Judgment and Order dated 07. I 0.2004 of the High Court 
of Judicature at Calcutta in F.M.A. No. 356 of2004 
WITH 
C. A. No. 4930 of2006. 
R. P. Gupta, Mehul M. Gupta, Ranjan Mukhe1jee, Dr. Kailash 
Chand, Gaurav Agarwal, Abhinav D. Rao, Soumitra G. Chaudhuri, Parijat 
Sinha, Anip Sachthey Advs. for the appearing parties. 
The Judgment of the Court was delivered by 
JAGDISH SINGH KHEHAR, J. 
Civil Appeal No. 4646 of 2006 
1. Biswa Ranjan Sengupta (hereinafter referred to as 'the 
appellant's father'), was admitted as a member of the Sarbar View 
Cooperative Housing Society Limited (hereinafter referred to as 'the 
Cooperative Society'), against Flat No.4-RB 2/3, Purbachal Housing. 
Estate, Phase-II, Sector-III, Salt Lake City, Kolkatta. He (Biswa Ranjan 
Sengupta) had married Parul Sengupta. Out of the above wedlock, 
there were two children - a daughter (Indrani Wahi) and a son (Dhruba 
Jyoti Sengupta). It is not a matter of dispute, that his (Biswa Ranjan 
Sengupta's) membership of 'the Cooperative Society' had resulted. in 
the allotment of the flat referred to
hereinabove. Biswa Ranjan Sengupta 
recorded the name of the appellant - lndrani Wahi, in terms of the 
mandate contained in Section 79 of the West Bengal Cooperative 
Societies Act, 1983 (hereinafter referred to as 'the 1983 Act'). Under 
Section 79, a member of'the Cooperative Society' is required to nominate 
a person in whose favour 'the Cooperative Society' would dispose of 
the share or interest of the member ''on his death''. 
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2. It is the case of the appellant before this Court, that her father 
- Biswa Ranjan Sengupta, lived under her exclusive care eversince March 
2002, whereafter he died on 22.07.2003. It is also the case of the 
appellant, that neither the appellant's mother nor her brother participated 
in the last rites of her father - Biswa Ranjan Sengupta. In our considered 
view, these facts are irrelevant for the adjudication of the present 
controversy. They are, however, being recorded herein, on account of 
the significance assigned to them, in the pleadings, and also during the 
course of hearing. 
3. After the death of her father- Biswa Ranjan Sengupta, Indrani 
Wahi addressed a communication dated 05.08.2003 to the Secretary of 
'the Cooperative Society', for entering her name in place of the name of 
her father, with reference to Flat No.4-RB 2/3, Purbachal Housing Estate, 
Phase-II, Sector-Ill, Salt Lake City, Kolkatta. The Managing Committee 
of the Housing Society passed a unanimous resolution on 15.08.2003, 
for transferring the membership of Biswa Ranjan Sengupta in 'the 
Cooperative Society' to the name of the appellant- Indrani Wahi. 
4. It is the case of the appellant, that consequent upon the passing 
of the above resolution, she (lndrani Wahi) has been paying maintenance 
and other charges to the Society. It is also pointed out, that the Secretary 
of'the Cooperative Society', through a covering
letter dated 16.08.2003, 
sent all papers with reference to the transfer of the membership of'the 
Cooperative Society' from the name of 8 iswa Ranjan Sengupta, to the 
name of Indrani Wahi, to the Deputy Registrar, Cooperative Societies. 
The papers dispatched, included the resolution of 'the Cooperative 
Society' referred to above. 
5. On 01.09.2003, having got wind of the transfer of the 
membership, of 'thi:; Cooperative Society' from the name of his father -
Biswa·Ranjan Sengupta, to the name of his sister- Indrani Wahi, Dhruba 
Jyoti Sengupta addressed the letter to the Deputy Registrar, Cooperative 
Societies on behalf of his mother- Parul Sengupta. In the above letter, 
he (Dhruba Jyoti Sengupta) asserted, that the membership to the flat 
should be transferred to the name of his mother - Parul Sengupta. In 
response to the letter dated 01.09 .2003, the Deputy Registrar, Cooperative 
Societies, by an order dated 19.09.2003, required the parties to submit 
documents to demonstrate, that the deceased had a family. The Secretary 
of 'the Cooperative Society' informed Parul Sengupta, that the name of 
Indrani Wahi had been recorded as a nominee ofBiswa Ranjan Sengupta,
IND RANI WAHi v. REGISTRAR OF COOP. SOCIETIES & ORS. 
311 
[JAGDISH SINGH KHEHAR, J.] 
in the records of'the Cooperative Society', and if Parul Sengupta desired 
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to verify the same, it was open to her to inspect the records. 
6. In response to the letter dated 19.09.2003, the Secretary of 
'the Cooperative Society' submitted the following information to the 
Deputy Registrar, Cooperative Societies through a communication dated 
26.09.2003: 
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"(I) Late B.R. Sengupta had a family consisting of wife, son and 
daughter-in-law. They all dairded (sic derided) him and he was 
living with his daughter Mrs. lndrani Wahi, where he eventually 
died. A copy of his 'Will' is enclosed 'which will speak its~lf'. 
We reiterate our views that his daughter in the "legal nominee". 
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(2) Salary Certificate dated 22.9.03 of Mrs. Indrani Wahi is 
attached. 
(3) In the State ofU.P., there is no law regardi11g profession tax 
which has been certified in the Salary Certificate itself. 
(4) The provision of Registration Act, 1908 will not apply in this 
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case, since the.-property was already registered under the Act in 
the name of Late Sengupta, copies of which are enclosed for 
your perusal. 
Kindly arrange for necessary approval." 
(Emphasis is ours) 
7. Yet again, Dhruba Jyoti Sengupta sent a letter on behalf of his 
mother, to the Secretary of the Society dated 29.09.2003 again with 
reference to the flat in question. He reiterated his previous assertion, 
that the flat be transferred
to the name of Parul Sengupta. In response 
to the above communication, the Secretary of 'the Cooperative Society' 
again informed Parul Sengupta, through a letter dated 16. I 0.2003, that 
the name oflndrani Wahi was recorded by Biswa Ranjan Sengupta as 
his nominee, with reference to the flat in question. 
8. A further twist was added to the sequence of events, when 
Dhruba Jyoti Sengupta addressed another Jetter dated 20. I 0.2003 to the 
Deputy Registrar, Cooperative Societies, informing him, that Biswa 
Ranjan Sengupta had not nominated Indrani Wahi, but had actually 
nominated Parul Sengupta (in terms of the nomination stipulated under 
Section 79 of the 1983 Act). It is in the aforesaid view of the matter, that 
the Deputy Registrar, Cooperative Societies declined to record the name 
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oflndrani Wahi, as the successor of the flat originally allotted to Biswa 
Ranjan Sengupta. The instant determination was referred to in an order 
dated 11.11.2003. A relevant extract of the same is reproduced hereunder: 
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"With reference to his letter above, this is to inform him that as 
Late Sengupta had family of his own, the nomination made by 
late Sengupta in favour ofSmt. Wahi can't be accepted, as it was 
not done in terms of section 79 of W.B.C.S. Act read with Rule 
127 of the W.B.C.S. Rules, 1987. 
Hence Jetter of administration/ succession certificate is required 
in favour of Smt. Wahi in terms of Rules 128 ofW.B.C.S. Rules, 
1987." 
(Emphasis is ours) 
It is apparent, that through the aforesaid communication, the transfer of 
the flat in the name of the appellant was declined on the ground, that the 
appellant being a married daughter did not fall within the definition of 
term 'family' as contemplated under Section 79 of the I 983 Act [read 
with Rule 127 of the West Bengal Co-operative Societies Rules, 1987 
(hereinafter referred to as 'the 1987 Rules']. And that, being a married 
daughter, lndrani Wahi was not a member of the family ofBiswa Ranjan 
Sengupta. 
9. It would also be relevant to mention, that the aforesaid 
·communication dated 11.11.2003, did not deal with the issue of succession 
of interest of the above flat, after the death of Biswa Ranjan Sengupta. 
A copy of the
aforesaid communication dated l I .11.2003 was sent to 
the appellant- Jndrani Wahi, by the Secretary of'the Cooperative Society' 
through a forwarding letter dated I 3. I I .2003. 
I 0. Aggrieved with the decision taken by the authorities, in rejecting 
the appellant's claim with reference to the transfer of the flat under 
reference, the appellant assailed the order of the Deputy Registrar, 
Cooperative Societies dated 11.11.2003, and that of the Secretary of 
'the Cooperative Society' dated 13.11.2003, by preferring Writ Petition 
No.33(W) of 2004, before the High Comi of Judicature at Calcutta 
(hereinafter referred to as 'the High Court'). The aforesaid writ petition 
came to be allowed by a learned Single Judge of the High Court, vide an 
order dated 24.03.2004. In recording its conclusion, the High Court, inter 
alia, held that the Deputy Registrar of the Cooperative Societies was not 
justified to exclude the appellant being a daughter of the original member
INDRANI WAHI v. REGISTRAR OF COOP. SOCIETIES & ORS. 
313 
[JAGDISH SINGH KHEHAR, J.] 
- Biswa Ranjan Sengupta from the purview of the provisions of the 
1983 Act, and the 1987 Rules framed thereunder. In fact, the High 
Court, in its conclusions, expressly recorded, that Rule 127 of the 1987 
Rules include major sons and daughters as members of the family, in 
addition to minor sons and daughters, without any clarification as to their 
marital status. The High Court accordingly held, that the married 
daughters were not excluded from the purview of Rule 127 of the 1987 
Rules. Having so concluded, the teamed Single Judge of the High Court, 
directed the Registrar of the Cooperative Societies to grant the necessary 
approval for transfer of the membership in the name oflndrani Wahi, as 
nominee ofBiswa Ranjan Sengupta. 
11. The mother of.the appellant- Parul Sengupta, and her brother 
- Dhruba Jytoi Sengupta, being aggrieved of the order passed by the 
learned Single Judgt: dated 24.03.2004, assailed the same, by preferring 
F.M.A.No.356 of 2004. Vide the impugned order dated 07.10.2004, a 
Division Bench of the High Court, relying upon the judgment rendered 
by this Court in Usha Ranjan Bhattacharjee 
vs. Abinash Chandra 
Chakraborty, (1997) I 0 SCC 344, Smt. Sarbati Devi vs. Smt. Usha Devi, 
(1984) I SCC 424 and Gayatri De vs. Mousumi Cooperative Housing 
Society Limited, (2004) 5 SCC 90, inter alia, concluded: 
"We do not propose to hold that the writ petitioner, in whose
favour 
nomination has been made, shall not be made a member of the 
said society and having regard to the legislature intent contained 
in sub-section ( 4) of Section 69 it may not be possible for us to 
direct the appellants to be joint members along with the writ 
petitioner, but to protect the interest of the appellants in the flat 
which they have inherited, it is necessary for the said Society to 
record their interest expressly in the share Certificate as well as 
in its records pertaining to members and, in particular in the register 
of members so that one of the joint owners merely because of the 
nomination in her favour cannot transfer either the share, in which 
she has a part interest, or the allotment, where also she has a part 
interest, for the same is expressly declared to be transferable 
and, accordingly, can only be transferred by expressing consent 
of all the heirs. 
With the above we dispose of the appeal without, however, any .. 
order as to costs." 
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Dissatisfied with the aforesaid determination of the High Court, lndrani 
Wahi has approached this Comt by filing the present appeal. 
12. Before dealing with the controversy in hand, it is imperative 
for us to refer to the judgments relied upon by the Division Bench in 
recording its conclusion. Reference may first be made to the Usha Ranjan 
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Bhattacharjee case (supra), wherein this Court dealt with Sections 69 
and 70 of the West Bengal Co-operative Societies Act, 1973 (hereinafter 
referred to as 'the 1973 Act'). Sections 69 and 70 of the 1973 Act came 
up for interpretation at the hands of this C0t1rt in the above-mentioned 
judgment. Sections 69 and 70 aforementioned are extracted hereunder: 
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"69. If the by-laws of a co-operative society so permit, any, 
member of the society may, in accordance with the rules, nominate 
a person in whose favour the society shall dispose of the share or 
interest of such member on his death. 
70. (I) When any member ofa co-operative society dies, his share . 
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and interest in the society shall, subject to the provisions of sections 
50 and 68 and to the fu1ther provisions of this section, be 
transferred -
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(a) to the person, if any, nominated in accordance with the 
provisions of section 69; or 
(b) ifthere be no such nominee or, ifthe existence and residence 
of such nominee cannot be ascertained by the managing 
committee, or if for any other cause such transfer
cannot be 
made without unreasonable delay, to the person who (subject 
to the production by him of probate, letters ofadministration or 
succession certificate) appears to the managing committee to 
be entitled, in accordance with the rules, to possession of such 
share or interest as part of the estate of the deceased member; 
or 
(c) on the application of the person referred to iri'clause (b) 
within three months of the death of the deceased member, to 
any person specified in the application. 
(2) If the share or interest of the deceased cannot be legally 
transferred in accordance with the provisions of sub-section (I), 
or if the person, to whom the share or interest is payable under 
that sub-sect·ion within one year of the death of the deceased
INDRANI WAHi v. REGISTRAR OF COOP. SOCIETIES & ORS. 
[JAGDISH SINGH KHEHAR, J.] 
member, claims payment of the value of such share or interest, or 
ifthe society in 
accordance with the rules and by-laws decides 
to proceed according to this sub-section - -
(a) the share shall be transferred to some other person qualified 
in accordance with the provisions of section 68 to be the 
transferee of the share, on receipt from such person of the 
value thereof; and 
(b) the value of the share or interest of the deceased member, 
determined in accordance with the rules, shall be paid to the 
person nominated in accordance with the provisions of section 
69 or to the person appearing to be entitled to possession of 
such share or interest as aforesaid, after deducting the amount 
of any sum payable 
under this Act to the society from the 
estate of the deceased member." 
The factualposition that arose for consideration has been recorded in 
paragraph 3 of the above judgment, and the reasons for not accepting 
the determination rendered by the High Court, as also, the proposition 
canvassed at the hands of the learned counsel appearing for the appellant 
were dealt with in paragraphs 3 to 6 of the Usha Ranjan Bhattacharjee 
case (supra). The same are being extracted below: 
"3. The dispute arose when the Cooperative Society wanted to 
hand over the possession of the said flat to Shri Chakraborty 
because the appellants were found in physical possession of the 
said flat. The case of
the appellants was that since Shri Ranendra 
Kumar Achatya died intestate, they had inherited the said property 
of Ranendra Kumar Acharya according fo the rules of intestate 
succession under the Hindu Succession Act. The respondent, 
however, contended that as nomination was made in his favour, 
the Cooperative Society was under a duty to hand over the 
possession of the said flat in favour of the respondent. Such dispute 
ultimately was raised before the Cooperative Tribunal. The 
Cooperative Tribunal held that there had been a valid nomination 
in favour of the respondent by the deceased Shri Ranendra Kumar 
Acharya but the Tribunal held that the question of title to the 
property was to be adjudicated by an appropriate forum if the 
parties would approach such forum. Since no direction for handing 
over the possession of the flat in favour ofShri Abinash Chandra 
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Chakraborty was given, a writ petition was filed before the High 
Court against the decision of the Cooperative Tribunal. The learned 
Single Judge disposed of such Writ Petition being CO No. 766 of 
1987. The learned Single Judge directed the Cooperative Society 
to hand over the possession of the said flat in favour of the said 
Abinash Chandra Chaktraborty under Section 70 of the 
Cooperative Societies Act, 1973. The learned Judge also made 
observation about the effect of such nomination under the said 
Act by indicating that in view of such nomination, the party in 
whose favour valid nomination had been made under Section 69 of 
the said Act must be held to have acquired title to the property. 
Such decision of the learned Single Judge was challenged before 
the Division Bench of the High Court in appeal. By the impugned 
judgment, the Division Bench has dismissed the appeal and has 
upheld the decision of the learned Single Judge. 
4. In our view, Mr. Amal Ganguli, learned Senior Counsel appearing 
for the appellants, has rightly contended that within the limited 
scope of Section 69 and 70 of the West Bengal Cooperative 
Societies Act, 1973, the Cooperative Tribunal was not required to 
determine the disputed question of title between the parties in 
dispute and the High Court had also gone wrong in holding that 
when a valid nomination is made, the nominee acquires title to the 
property in
question. 
5. Dr. Shanker Ghosh, learned Senior Counsel appearing for the 
respondent has, however, submitted that the West Bengal 
Cooperative Societies Act, 1973 is a complete code by itself and 
since the said Act is applicable notwithstanding anything contained 
in any other Act, if a rival claim of title to the property is raised, 
the Cooperative Tribunal is not incompetent to decide such title. 
6. We are, however, not inclined to accept such contention of Dr. 
Ghosh. In our view, within the limited scope ofinquiiy to be made 
for determining the qu~stion of valid nomination under Section 69, 
title to the property cannot be detennined. In terms of detennination 
of valid nomination the consequential direction for deliverv of 
possession can be given in favour of the person having valid 
nomination under the provisions of Section 70 of the Cooperative 
Societies Act. The dispute as to the question of title is not to be 
decided within the limited scope and ambit of Sections 69 and 70 of
INDRANI WAHi v. REGISTRAR OF COOP. SOCIETIES & ORS. 
[JAGDISH SINGH KHEHAR, J.] 
the cooperative Societies Act. We, therefore, dispose of this appeal 
by directing that in view of the finding by the Tribunal that the 
respondent had obtained a valid nomination from the deceased 
Ranendra Kumar Acharya, the respondent is entitled to get the 
possession of the said flat in accordance with the provisions 
of Section 70 of the Cooperative Societies Act. But the dispute 
as to the title of the said flat should not be held to have been 
decided either by the Cooperative Tribunal or by the High Court 
by the impugned judgment. Such question is kept open to be 
decided by an appropriate forum if such challenge is made before 
· the appropriate forum. This appeal is accordingly disposed of 
without any order as to costs." 
(Emphasis is ours) 
There can be no doubt about the fact, that in the above cited case, 
a Division Bench of this c;:ou11 had arrived at the conclusion, that 
the High Court erred while concluding, that the holding of a valid 
nomination could ipso facto result in the transfer of title in favour 
of the nominee. Despite recording the above conclusion, this Court 
ultimately held, that consequent upon a valid nomination having 
been made under Section 69, the nominee would be entitled to 
possession, and further, that the issue of title had to be left to be 
adjudicated upon between the contesting parties. 
13. We shall now deal with the judgment in the Smt. Sarbati
Devi 
case (supra). The issue which came up for adjudication in the above 
judgment related to the interpretation of Section 39 of the Life Insurance 
Act, 1938. The rights of a nominee of a policy holder, were adjudicated 
upon in the above judgment. Paragraphs 4, 5 and 12 of the judgment 
record the conclusions of this Court, with reference to the rights of a 
nominee of a policy holder. The aforesaid paragraphs are extracted herein 
below: 
"4. At the outset it should be mentioned that except the decision 
of the Allahabad High Court in Kesari Devi v. Dharma Devi AIR 
1962 All 355 on which reliance was placed by the High Court in 
dismissing the appeal before it and the two decisions of the Delhi 
High Court in S. Fauza Singh v. Kuldip Singh AIR 1978 Del 276 
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and· Uma Sehgal v. Dwarka Dass Sehgal AIR 1982 Del 36 in all 
other decisions cited before us the view taken is that the nominee 
µnder Section 39 of the Act is nothing more than an agent to receive 
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SUPREME COURT REPORTS 
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the money due under a life insurance policy in the circumstances 
similar to those in the present case and that the money remains 
the property of the assured during his lifetime and on his death 
forms part of his estate subject to the law of succession applicable 
to him. The cases which have taken the above view are Ramballav 
Dhandhania v. Gangadhar Nathmall AIR 1956 Cal 275; Life 
Insurance Corporation oflndia v. United Bank oflndia Ltd.AIR 
1970 Cal 513, D. Mohanavelu Muldaliar v. Indian Insurance and 
Banking Corporation Ltd. Salem AIR 1957 Mad 115, Sarojini 
Amma v. Neelakanta Pillai AIR 1961 Ker 126; Atmaram Mohanlal 
Panchal v. Gunvantiben AIR 1977 Guj 134, Ma Iii Dei v. Kanchan 
Prava Dei AIR 1973 Ori 83 and Lakshmi Amma v. Saguna 
Bhagath !LR 1973 Kant 827, Since there is a conflict of judicial 
opinion on the question involved in this case it is necessary to 
examine the above cases at some length. The law in force in 
England on the (!bove question is summarised in Halsbury's Laws 
of England (Fomth Edition), Vol. 25, Para 579 thus; 
"579. Position of third party, The policy money payable on the 
death of the assured may be expressed to be payable to a third 
paity and the third pa1ty is then prima facie merely the agent 
for the time being of the legal owner and has his authority to 
receive the policy money and to give a good discharge; but he 
generally has no right to sue the insurers in
his own name. The 
question has been raised whether the third party's authority to 
receive the policy money is terminated by the death of the 
assured; it seems, however, that unless and until they are 
otherwise directed by the assured's personal representatives 
the insurers may pay the money to the third party and get a 
good discharge from him." 
5. We shall now proceed to analyse the provisions of Section 
39 of the Act. The said section provides that a holder of a policy 
oflife insurance on his own life may when effecting the policy or 
at any time before the policy matures for payment nominate the 
person or persons to whom the money secured by the policy shall 
be paid in the event of his death. If the nominee is a minor, the 
policy holder mav appoint any person to receive the money in the 
event of his death during the minority of the nominee. That means 
that ifthe policy holder is alive when the po lie' matures for payment
INDRANI WAHi v. REGISTRAR OF COOP. SOCIETIES & ORS. 
319 
[JAGDISH SINGH KHEHAR, J.] 
he alone will receive payment of the money due under the policy 
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and not the nominee. Any such nomination may at any time before 
the policy matures for payment be cancelled or changed, but before 
such cancellation or change is notified to the insurer ifhe makes 
the payment bon fide to the nominee already registered with him, 
the insurer gets a valid discharge. Such power of cancellation of· 8 
or effecting a change in the nomination implies that the nominee 
has no right to the amount during the lifetime of the assured. If 
the policy is transferred or assigned under Section 38 of the Act, 
the nomination automatically lapses. If the nominee or where there 
are nominees more than one all the nominees die before the policy 
matures for payment the money due under the policy is payable 
to the heirs or legal representatives or the holder of a succession 
certificate. It is not necessary to refer to sub~section (7) of Section 
39 of the Act here. But the summary of the relevant provisions 
of Section 39 given above establishes clearly that the policy holder 
continues to hold interest in the policy during his lifetime and the 
nominee acquires no sort of interest in the policy during the lifetime 
of the policy holder. If that is so, on the death of the policy holder 
the amount payable under the policy becomes part of his estate 
which is governed by the law of succession applicable to
him. 
Such succession may be testamentary or intestate. There is no 
warrant for the position that Section 39 of the Act operates as a 
third kind of succession which is styled as a 'statutory testament' 
in paragraph 16 of the decision of the Delhi High Court in Mrs. 
Uma Sehgal's case (supra). If Section 39 of the Act is contrasted 
with Section 38 of the Act which provides for transfer or 
assignment of the rights under a policy, the tenous character of 
the right of a nominee would become more pronounced. It is 
difficult to hold that Section 39 of the Act was intended to act as 
a third mode of succession provided by the statute. The provision 
in sub-section (6) of Section 39 which says that the amount shall 
be payable to the nominee or nominees does not mean that the 
amount shall belong to the nominee or nominees. We have to bear 
in mind here the special care which law and judicial precedents 
take in the matter of execution and proof of wills which have the 
effect of diverting the estate from the ordinary course of intestate 
succession and that the rigour of the rules governing the 
testamentary succession is not relaxed even where wills are 
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registered. 
12. Moreover there is one other strong circumstance in this case 
which dissuades us from taking a view contrary to the decisions 
of all other High Courts and accepting the view expressed by the 
Delhi High Court in the two recent judgments delivered in the 
year 1978 and in the year 1982. The Act has been in force from 
the year I 938 and all along almost all the High Courts in India 
have taken the view that a mere nomination effected under Section 
39 does not deprive the heirs of their rights in the amount payable 
under a life insurance policy. Yet Parliament has not chosen to 
make any amendment to the Act. In such a situation unless there 
are strong and compelling reasons to hold that all these decisions 
are wholly erroneous, the Court should be slow to take a different 
view. The reasons given by the Delhi High Court are unconvincing. 
We, therefore, hold that the judgments of the Delhi High Court in 
Fauja Singh's case (supra) and in Mrs. U ma Sehgal's case (supra) 
do not lay down the law correctly. They are, therefore, overruled. 
We approve the views expressed by the other High Courts on the 
meaning of Section 39 of the Act and hold that a mere nomination 
made under Section 39 of the Act does not have the effect of 
conferring on the nominee any beneficial interest in the amount 
payable under the life insurance policy on the death of the assured. 
The nomination only indicates
the hand which is authorised to 
receive the amount, on the payment of which the insurer gets a 
valid discharge of its liability under the policy, The amount; 
however, can be claimed by the heirs of the assured in accordance 
with the law of succession governing them." 
(Emphasis is ours) 
At this juncture, all that needs to be stated with reference to the judgment 
in the Smt. Sarbati Devi case (supra) is, thatthe provisions with reference 
to nomination under the Life Insurance Act, 1938 are at variance from 
the ones which are subject matter of consideration in the instant case, 
and as such, it would suffice to merely state, that the aforesaid judgment 
is not of much significance, insofar as the adjudication of the present 
controversy is concerned. 
14. Insofar as the judgment in the Gayatri De case (supra) is 
concerned, the same expressly dealt with the provisions of the 1983 
Act. Despite the above, it would be pertinent to mention, that the said
INDRANI WAHI v. REGISTRAR OF COOP. SOCIETIES & ORS. 
[JAGDISH SINGH KHEHAR, J.] 
judgment is also of no relevance for the present controversy, because 
there was no nomination of the original member, in the said controversy. 
And as such, Section 79 did not come up for consideration and 
interpretation therein, in the manner of the dispute and controversy which 
has arisen herein. 
15. Herein, the original member-Biswa Ranjan Sengupta, in whose 
name Flat No.4-RB 2/3, Purbachal Housing Estate, Phase-II, Sector-
III, Salt Lake City, Kolkatta, was entered, had recorded the name of his 
daughter- lndrani Wahi (the appellant herein) as his sole nominee. The 
aforesaid nomination was made in terms of Section 79 of the 1983 Act. 
We are of the view, that Sections 79 and 80 of the 1983 Act are of 
pointed significance for the determination of the controversy in hand. 
The same are accordingly reproduced hereunder: 
"79. Nomination of transferee.- Subject to the by-laws of a co-
operative society and (sic any) member of such co-operative 
society may in accordance with the rules nominate a person in 
whose favour the co-operative society shall dispose of the share 
or interest of such member on his death. 
80. Disposal of deceased member's share of interest- (I) On the 
death of a member of a co-operative society, other than a central 
society, his share or interest in the co-operative society shall, subject 
to the provisions of sections 57 and 78 and to the further provisions
under section 79; or 
(a) to the person, if any, nominated under section 79; or 
(b) if there is no nominee or if the existence or residence of 
the nominee cannot be ascertained by the board or if, for any 
other cause, the transfer cannot be made without unreasonable 
delay, to the person who (subject to the production by such 
person of probate, letter of administration or succession 
certificate) appears to the board to the entitled in accordance 
with the rules to the possession of such share or interest as 
part of the estate of the deceased member; or 
( c) on the application of the person referred to in clause (b) 
within three months from the date of death of the member, to 
such person as may be specified in the application. 
(2) If the share or interest of a deceased member cannot be 
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transferred in 
accordance with the provisions of sub-section 
(I) or if the person to whom such share or interest is payable 
under that sub-section claims payment of the value of such share 
or interest or ifthe co-operative society in accordance with the 
rules and its by-laws decides to proceed under this sub-section -
(a) the share shall be transferred to a person qualified to be a 
transferee of the share, under section 78 on receipt of the 
value of the share from such person; and 
(b) the value of the share or the interest of the deceased member 
determined in accordance with the rules shall be paid to the 
person nominated under section 79 or to the person referred to 
in clause (b) of sub-section (I) of this section after deducting 
the amount payable under this Act to the co-operative society 
from the estate of deceased member." 
Having perused the aforesaid provisions, there can be no doubt, that 
where a member of a cooperative society nominates a person in 
consonance with the provisions of the Rules, on the death of such member, 
the cooperative society is mandated to transfer all the share or interest 
of such member in the name of the nominee. The above interpretation 
of Section 79, at our hands, also emerges from Section 80(1 )(a) which 
postulates, that the share or interest of a member of the society, "on his 
death" shall be transferred to a person "nominated under Section 79". lt 
is
also essential to notice, that the rights of others on account of an 
inheritance or succession is a subservient right. Only if a member had 
not exercised the right of nomination under Section 79, then and then 
alone, the existing share or interest of the member would devolve by 
way of succession or inheritance. The heading of Section 80 - "Disposal 
of deceased member's share of interest" lends further credence to the 
above interpretation. 
16. In addition to the aforesaid statutory provisions, we would like 
to make a reference to Rules 127 and 128 of the West Bengal Co-
operative Societies Rules, 1987 (hereinafter referred to as 'the 1987 
Rules'). Rules 127 and 128 of the 1987 Rules are extracted below: 
"127.Nomination of transferee.- (I) A member of a co-operative 
Society may in accordance with the provision of Section 79, 
nominate in writing any person belonging to his family to whom 
the share or interest or the value of such share or interest shall, on
INDRANI WAHI v. REGISTRAR OF COOP. SOCIETIES & ORS. 
323 
[JAGDISH SINGH KHEHAR, J.] 
his death, be paid or transferred under the provision of the Act: 
A 
Provided that if a member has no family he may nominate any 
person to whom such share or interest or the value of such share 
or interest shall be paid or transferred: 
Provided further that such member may, from time to time, revoke 
such nomination and make a fresh nomination. 
(2) Every co-operative socie.ty shall keep a register of all person 
(sic persons) so nominated. 
B 
(3) In case the nominee of a member dies, the member shall 
report the death to the society, and make a fresh nomination ifhe c 
so desires. 
Explanation.- For the purpose of this rule a family shall have the 
same meaning as given in the Explanation to sub-section (2) of 
Section 13 and shall include major sons and daughters. 
128. 
Disposal of deceased member's share or interest and 
procedure for calculation of value of shares.- (I) When upon the 
death of a member of a co-operative society, the question of 
transferring the share, or paying interest of such deceased member 
arises, and the board of such society finds that the deceased 
member did not make any nomination in accordance with the 
provisions of section 79, or that the existence or residential address 
of the person nominated cannot be ascertained, or that for any 
other sufficient cause such transfer of payment cannot be made 
without unreasonable delay, the board may transfer
the share or 
pay interest of such deceased member in favour of or to any 
person who presents in writing his or her claim for the said share 
or interest and produces, in support of such claims, probate, letter 
of administration or succession certificate issued by a competent 
court having jurisdiction, and makes a written declaration in an 
affidavit before a Magistrate that he or she is the rightful claimant, 
being the legal heir or representative of the deceased. 
(2) (a) Where a co-operative society has to make a refund of the 
value of a share, the value of the share shall be deemed to be 
equal to the amount paid upon the share: 
Provided that where a portion of the assets is estimated to be bad 
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by funds created out of profits, the board may, for the purposes of 
such payment, reduce the value of the share in the same proportions 
as the aggregate amount of assets which are not bad or doubtful, 
less the amount of outside liabilities, bears to the paid-up share 
capital. 
(b) Where a transfer of share or interest is made, the value of the 
share or interest shall be deemed to be the sum actually paid by 
the member for the acquisition of such share or interest." 
17. In the same manner as is postulated under Section 79 of the 
1983 Act, Rule 127 of the I 987 Rules provides, that if a nomination has 
been made by a member under Section 79, the share or interest or the 
value of such share or interest standing in the name of the deceased 
member, would be transferred to the nominee. It is however, necessary 
to notice that Rule 127 postulates nomination only in favour of a person 
"belonging to his family". 
It is not necessary for us to deal with the 
issue whether the appellant- lndrani Wahi, being a married daughter of 
the original member - Biswa Ranjan Sengupta, could be treated as a 
member of the family, of the deceased member (Biswa Ranjan Sengupta), 
because the learned Single Judge, as also, the Division Bench of the 
High Court concluded, that the appellant- lndrani Wahi was a member 
of the family, of the original member - Biswa Ranjan Sengupta. This 
conclusion has not been assailed by
the respondents, before this Court. 
18. Rule 128 of the 1987 Rules also leads to the same inference. 
Inasmuch as Rule 128 aforementioned provides, that only in the absence 
of a nominee, the transfer of the share or interest of the erstwhile member, 
would be made on the basis of a claim supported by an order of probate, 
a letter of administration or a succession certificate (issued by a Court 
of competent jurisdiction). 
19. Insofar as the instant aspect of the matter is concerned, there 
is no doubt in our mind, that even Rules I 27 and 128 of the 1987 Rules, 
lead to the inference, that in case of a valid nomination, under Section 79 
of the 1983 Act, 'the Cooperative Society' is liable to transfer the share 
or interest of a member in the name of the nominee. We hold accordingly. 
20. Having recorded the above conclusion, it is imperative for us 
to deal with the conclusion recorded in paragraph 6 (already extracted 
above) of the judgment of this Court in the Usha Ranjan Bhattacharjee 
case (supra). In this behalf, it is necessary to clarify that transfer of
INDRANI WAH! v. REGISTRAR OF COOP. SOCIETIES & ORS. 
[JAGDISH SINGH KHEHAR, J.] 
share or interest, based on a nomination under Section 79 in favour of 
the nominee, is with reference to the concerned C9operative Society, 
and is binding on the said society. The Cooperative Society has no 
option whatsoever, except to transfer the membership in the name of 
the nominee, in consonance with Sections 79 and 80 of the 1983 Act 
(read with Rules 127 and 128 of the 1987 Rules). That, would have no 
relevance to the issue oftitle between the inheritors or successors to the 
property of the deceased. Insofar as the present controversy is concerned, 
we therefore hereby direct 'the Cooperative Society' to transfer the 
share or interest of the society in favour of the appellant- lndrani Wahi. 
It shall however, be open to the other members of the family (presently 
only the son ofBiswa Ranjan Sengupta - Dhruba Jyoti Sengupta; we 
are informed that his mother - Parul Sengupta has died), to pursue his 
case of succession or inheritance, ifhe is so advised, in consonance with 
law. 
21. The appeal stands allowed in the above terms. 
Civil Appeal No.4930 of 2006 
22. Learned counsel for the parties are agreed, that the controversy 
raised in the instant appeal be disposed of in terms of the order passed 
by this Court in Indrani Wahi vs. Registrar of Co-operative Societies & 
Ors. (C.A.No.4646 of2006) decided on 10.03.2016. 
23. In view of the above, the instant appeal is disposed of in
terms 
of the judgment rendered by this Court in the Indrani Wahi case (supra). 
Kalpana K. Tripathy 
Appeals disposed of. 
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