Being a Non-Resident Indian (NRI), handling the inheritance issues in India can be quite difficult, especially when there is no will. It is where a Succession Certificate comes into play. It helps NRIs to legally handle and claim the assets of a deceased relative in India.
However, most NRIs face difficulties in handling this process legally across international borders. For this, they need to understand the specific requirements, prepare the necessary documents, and coordinate with Indian courts while living overseas.
To help you out, this blog explains the entire process of applying for an NRI succession certificate in India. So, read on and gather all the information.
Key Takeaways
- A succession certificate helps claim the inheritance and manage the securities, debts, and other assets of a deceased person legally without a will.
- The succession certificate is issued by a district court where the deceased person last resided or where the asset is located.
- The person who has the name in the succession certificate gets the dividend/ interest on the securities held by the deceased person.
- Further, if an NRI cannot physically present in the court hearings, he/she can heir a legally authorized person through a Power of Attorney.
- The process of obtaining a succession certificate generally takes 7-8 months.
What is an NRI Succession Certificate?
A succession certificate is a document issued by the court that provides you with the legal right to inherit and manage the securities, debts, and other assets of a deceased person. When an individual dies without a will, this certificate becomes a vital document. Under the Indian Succession Act, 1925, a succession certificate covers the deceased individual's financial and movable assets. However, this certificate is not used to cover immovable assets such as real estate.
Moreover, having this certificate does not automatically make you the heir to all properties, nor does it provide you with titles or ownership rights in property. It only grants authority to handle specific financial matters related to the deceased's estate. Additionally, this certificate provides you with dividends and interest on securities, transfer of securities in your name, and settlement of the outstanding debts.
Additionally, parents, spouse, children, and other relatives of the deceased can apply for the succession certificate. Apart from this, people granted administration letters by the court or executors mentioned in the will can also apply for the certificate.
This was all about the NRI succession certificate. Moving ahead, when they need to apply for this certificate.
When Do NRIs Need a Succession Certificate?
NRIs need the succession certificate in the following situations:
- Banking: To transfer or access funds from fixed deposits, savings, or other accounts in Indian banks.
- Insurance: To get payouts from retirement benefits or insurance policies.
- Investments: For claiming mutual funds, shares, or bonds. Additionally, transferring these assets into your name.
- Immovable Property: While primarily the succession certificate is used for movable assets. However, sometimes it can also be used for property transfers in some estates. It includes Delhi or Maharashtra, especially to obtain a Letter of Administration to proceed with probate.
These were some of the situations where NRIs need a succession certificate in India. Moving further, let's know the difference between a succession certificate and a legal heir certificate.
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Difference Between Succession and Legal Heir Certificate
The table below states the key difference between succession and a legal heir certificate.
| Particulars |
Succession Certificate |
Legal Heir Certificate |
| Legalisation and Purpose |
Under the Indian Succession Act, 1925, a succession certificate is issued with respect to any security or debt of the deceased person. |
A legal heir certificate is generally issued to identify the heirs of a deceased person, and it is issued in accordance with the relevant State and other applicable legislation, rules, and regulations. |
| Issuing Authority |
As a judge of a principal civil court of original jurisdiction, under the Indian Succession Act, 1925, the district judge issues the certificate. |
Depending on the legislation of the relevant state, purpose, and other things, this certificate is obtained from the local government bodies. This includes revenue departments, the Taluk Tashildar, the municipal corporation office, and more. |
| Use |
A succession certificate is used for collecting the security or debts on behalf of the deceased person. |
The legal heir certificate is used in connection with provident funds, pension benefits, bank accounts, and more. Additionally, it is also used for non-financial affairs like transferring employee benefits, insurance, electricity, and phone connections. |
These were the key differences between the succession certificate and the legal heir certificate. Moving ahead, let's know how to obtain an NRI succession certificate.
How to Obtain an NRI Succession Certificate?
The legal process to obtain an NRI succession certificate is as follows:
Choose the Right Court
An NRI should file a petition for a succession certificate in the district court with jurisdiction over the deceased's last residence. If the deceased person does not have a fixed residence, you can apply to the court where the assets are located.
Prepare and Submit Your Petition
You or your legal representative should draft and file a petition for the certificate in the court. Further, with your petition, you need to submit the following documents:
- Death certificate of the deceased
- Your relationship proof with the deceased person, like a birth certificate or a legal heir certificate
- Your proof of identity, such as an OCI card or a passport
- A list of all the assets that you want to claim
- An affidavit on a non-judicial stamp paper of requisite value
- Comprehensive details of all family members and legal heirs.
- If there are several legal heirs, then you also need to submit a No Objection Certificate from others
Public Notification
In a local newspaper, the court will publish a public notice. Generally, this notice will run for 30 days. It is a formal way of the court inviting any property objections to your claim. If there are no objections, the process will move forward smoothly.
Court Hearings and Validation
To verify your claim, the court will schedule hearings. Further, the physical presence of the NRIs is not vital if they have appointed a representative via a Power of Attorney (NRI PoA). Considering this, this legally authorized individual can handle all court proceedings on your behalf.
Issuance of the Certificate
Once the court is satisfied with your claim, you will get an NRI succession certificate. This certificate names you and specifies your respective shares in the assets of the deceased person. Additionally, you also need to pay court fees range from 2-5% of the value of the asset.
This is how you can obtain an NRI succession certificate. Generally, depending upon the raised objections and involved legal heirs, the process takes 5-7 months. Now, moving further, let's know the common challenges NRIs face when applying for a succession certificate.
Common Challenges NRIs Face When Applying for a Succession Certificate
Here is the list of common challenges that an NRI can face when applying for a succession certificate:
- Issues of Document Verification: When applying for a succession certificate, you need to submit original documents to the court. However, from overseas, sending these documents carries significant risks. To avoid this issue, it is advisable to have certified copies of all the required papers from your Indian consulate or embassy before shipping. It will protect your original papers from getting misplaced while fulfilling the requirements of the court.
- Court Appearance Requirements: Despite allowing virtual hearings, at certain stages, some courts still require your physical presence. In this scenario, you have two options: plan your travel to India as per your court dates or appoint a legally authorized individual through a Power of Attorney.
- Communication Barriers: The Difference in time zones complicates the coordination with Indian legal representatives. With preferred channels of communication and clear time expectations from the start, connect with the legal authorities. Further, for international coordination, email is better than phone calls.
- Language Complications: The court documents in regional languages frequently use complex terminology. This particularly creates issues for second or third-generation NRIs. During the process to prevent misunderstanding, you can request the court for an English translation.
- Processing Delays: It is well-known to everyone that the judicial system of India functions at its own pace. Additionally, inheritance matters, including international claimants compared to domestic cases, take longer to process. Further, beyond the standard 7-8 months timeframe, you should also consider an additional time.
These are the common challenges that NRIs should avoid when applying for a succession certificate in India.
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Final Thoughts
Lastly, obtaining an NRI succession certificate is an essential step in protecting your inheritance rights. Considering this, by understanding the legal forms and processes, you can handle all things efficiently.
Further, if you are facing issues in understanding the legal requirements of the succession certificate, connect with Savetaxs. The experts in our team have extensive knowledge of Indian laws and regulations. Through their help, you can easily handle the complex legal landscape and make the whole process comprehensible.
Note: This guide is for informational purposes only. The views expressed in this guide are personal and do not constitute the views of Savetaxs. Savetaxs or the author will not be responsible for any direct or indirect loss incurred by the reader for taking any decision based on the information or the contents. It is advisable to consult either a CA, CS, CPA, or a professional tax expert from the Savetaxs team, as they are familiar with the current regulations and help you make accurate decisions and maintain accuracy throughout the whole process.
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