Claiming a Deceased Relative's Money, Shares and Mutual Funds

Losing a parent or spouse is hard enough. Then comes the part nobody prepares you for: tracking down their savings account, that old demat holding, a handful of mutual fund folios, and figuring out how to get the money into your own hands. The process has a name — transmission — and in India it follows surprisingly consistent rules across banks, depositories and fund houses. Knowing them in advance saves families months of running between branches and lawyers.

This is a practical guide to claiming a deceased relative's money, shares and mutual funds, written for the person who has just been handed a folder of statements and has no idea where to start.

Why a nominee is not an heir

The single biggest misconception is that whoever is named as nominee gets to keep the money. They do not. Indian courts have repeatedly held that a nominee is a custodian, not an owner. The nominee's job is to receive the assets smoothly and then hand them over to the legal heirs as decided by the deceased's will or, if there is no will, by personal succession law.

This matters in real families. If a father names his eldest son as nominee on a fixed deposit, the bank will release the money to that son. But if the father's will splits the estate equally among three children, the son holds two-thirds of that money in trust for his siblings. Nomination speeds up collection. It does not rewrite inheritance.

Company shares were once argued to be an exception. A 2010 Bombay High Court ruling around the Companies Act was read by some as giving nominees of shares a stronger claim, and the point was argued back and forth for years. But in December 2023 the Supreme Court settled it, holding that share nominees too are only custodians and cannot override succession law. For ordinary families, treat even share nominees as custodians, and settle the split through the will.

When there is a nominee: the short route

If the deceased registered a nominee — and after recent rule changes a single bank account can carry up to four nominees — your job is mostly clerical. Each institution has its own form, but the documents are nearly identical.

• A death certificate, issued by the local municipal body. Get at least 8–10 certified copies; almost every institution keeps one.
• The institution's transmission request form (banks call it a claim form, depositories and fund houses call it a Transmission Request Form).
• The nominee's KYC — PAN, Aadhaar, address proof and a cancelled cheque or bank proof for the payout.
• The original passbook, deposit receipt, or a statement of the folio or demat account.

For mutual funds, you do not approach the fund house directly. You go to the registrar — CAMS or KFintech — which handles transmission for almost every Indian fund. One consolidated request can cover multiple folios. For shares held in demat, the claim goes through the Depository Participant (your broker), routed via CDSL or NSDL. If the demat account was held jointly, the surviving holder simply continues, and the deceased's name is deleted on submission of the death certificate.

No nominee, no will: succession certificate territory

This is where families get stuck. If the deceased left neither a nominee nor a will, the assets pass by intestate succession — Hindu Succession Act for Hindus, Sikhs, Jains and Buddhists; the relevant personal law for others. The institution now needs proof of who the legal heirs are and in what shares.

Two documents do most of the heavy lifting:

1. A succession certificate, granted by a civil court, is the standard instrument for collecting debts and securities — bank balances, shares, bonds and fund units. You file a petition in the district court of the place where the deceased lived, list the assets and heirs, the court publishes a notice inviting objections, and after a waiting period it issues the certificate. Court fees are typically a percentage of the asset value, which is why this route can get expensive for large estates.
2. A legal heir certificate, issued by the local tehsildar or revenue office, identifies the surviving family members. It is cheaper and faster but is mainly used for pensions, provident fund, and smaller dues — many banks will not release large balances on it alone.

For very large or contested estates, a court may instead grant a letter of administration. The practical takeaway: without a nominee or will, budget for court time. A succession certificate commonly takes several months and sometimes more than a year.

If there was a will

A will simplifies who inherits, but it does not always skip court. To act on a will, the executor may need probate — a court order confirming the will is genuine. Probate is not mandatory everywhere. It becomes compulsory for wills covering immovable property within the original jurisdiction of the Kolkata, Mumbai and Chennai high courts, a relic of the old presidency-town rule.

For pure financial assets, many banks and fund houses will accept a registered will, an indemnity bond and an affidavit without forcing probate, especially below their threshold. Above it, or where heirs disagree, expect to be asked for a probated will. A registered will carries more weight and is harder to challenge, which is the strongest argument for registering one while alive.

The threshold every institution quietly uses

Here is the detail that decides whether your claim takes two weeks or two years. Every bank, depository and fund house sets an internal value threshold. Below it, and where there is no dispute, they release the money on a simplified set — death certificate, a transmission form, an indemnity bond and sometimes an affidavit or a no-objection from other heirs. Above it, they demand a succession certificate or probate.

The threshold varies by institution and changes over time, so do not assume a fixed figure. Always ask the branch or the registrar for their current limit before you start gathering documents. If the asset sits just above the cut-off, splitting a claim or timing it can occasionally bring it within the simplified band — ask, rather than assume the hard route is unavoidable.

A second quiet rule worth knowing: surviving joint holders almost always inherit operationally without any of this. A jointly held account, demat or folio passes to the survivor on producing the death certificate. Joint holding with a trusted family member is the cheapest estate planning India offers.

A checklist that saves months

For the family doing this now:

• Order 10 certified copies of the death certificate before anything else.
• Make a single master list of every account, folio, demat and policy, with numbers.
• Pull a consolidated mutual fund statement from CAMS or KFintech in one go — it reveals folios the family forgot existed.
• For each institution, ask two questions up front: is there a nominee on record, and what is the threshold for simplified transmission?
• Do not close the deceased's bank account until pending dividends, interest and refunds have landed.
• If you suspect forgotten deposits, search the RBI's unclaimed-deposits portal before assuming there is nothing more.

And for everyone reading this who is not in a crisis yet: register a nominee on every account, hold key assets jointly with a spouse or child, and write a registered will. It costs a few thousand rupees and an afternoon. The alternative is leaving the people you love to spend a year in a district court to collect money that was always meant for them.