Mst. RAZIA BEGUM vs PUBLIC AT LARGE S — 2025 CLD 122 LAHORE-HIGH-COURT-LAHORE

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Mst. RAZIA BEGUM VS PUBLIC AT LARGE S. 72---Life Insurance Policy, proceeds of---Tarka---Scope---Nominee assigned by the deceased---Scope and effect---Deceased in his lifetime purchased an insurance policy wherein he nominated his wife as his nominee---Mother of the deceased filed an application for issuance of succession certificate, which was concurrently declined---Claim of the petitioner (being mother of the deceased) was that she was entitled to inherit 1/6th share of the insurance policy amount, whereas, respondent (wife/widow) denied her right on the ground that being nominee she was solely entitled to receive the whole insurance policy amount---Deceased left behind mother (petitioner), widow (respondent/ nominee), a daughter and two sons (respondents)---Courts below non-suited the petitioner on the ground that the amount of the Insurance Policy did not fall within the ambit of "Tarka", which was not liable to be inherited by the legal heirs and only the nominee was entitled to receive the amount of said Life Insurance Policy---Whether the amount of Life Insurance Policy falls within the ambit of "Tarka" and is liable to be distributed amongst the legal heirs of the deceased propositus or not?---Held, that the status of the amount of Life Insurance Policy was not described in the insurance documents---However, S. 72 of the Insurance Ordinance, 2000, provides that the policy holder, when effecting the policy or at any time before the policy matures for payment, may nominate a person or persons as nominee to whom the money secured by the policy shall be paid in the event of the death of the insured person---Section 72 of the Ordinance, 2000, authorizes and empowers the policy holder to nominate a person or persons to whom the money secured by the policy shall be paid in the event of his death, but this provision of law does not exclude the legal heirs to inherit the assets, including the policy proceeds of the deceased according to the principle of Muhammadan Law, because there is a Constitutional guarantee enunciated in the Constitution of Pakistan that no law can be made which is contrary to the Injunctions of Quran and Sunnah---It is a Quranic injunction that the legal heirs of a Muslim deceased will inherit their assets according to the principle of Muhammadan Law, therefore, the nominee is only supposed to collect the policy proceeds and to disburse the same among the legal heirs, and further the nominee in any case shall not exclude or deprive the legal heirs of the fruits of the policy---Thus, the Insurance Policy proceeds fall within the definition of "Tarka" of the policy holder after his death---Both the Courts below had erred in law while dismissing the succession petition of the petitioner and had failed to properly appreciate the question involved in the lis as the present case related to Life Insurance Policy and the nominee was appointed by the nominator just to fulfill the legal requirement of S. 72 of the Insurance Ordinance, 2000---High Court set-aside the impugned judgments of the Courts below, and the petitioner, being mother of the deceased, was held entitled to receive her due share out of the policy proceeds---Revision petition, filed by mother of deceased was allowed accordingly. Citation Name: 2025 CLD 122 LAHORE-HIGH-COURT-LAHOREBookmark this Case Mst. RAZIA BEGUM VS PUBLIC AT LARGE S.72---Life Insurance Policy---Nominee, status of---Nomination merely confers a right to collect the money or to "receive the money"; it does not operate either as a gift or as a will and, therefore, cannot deprive the other heirs of the nominator who may be entitled thereto under the law of succession applicable to the deceased---Thus, the nominee collects as a trustee for the benefit of all persons entitled to inherit from the deceased employee---Nomination merely confers a right to collect the money or to receive the money and it does not operate as a gift or as a will and, therefore, cannot deprive the legal heirs of the nominator who may be entitled thereto under the law of succession applicable to the deceased propositus---Thus, the nominee collects as a trustee for the benefit of all persons entitled to inherit from the deceased propositus. Citation Name: 2025 CLD 122 LAHORE-HIGH-COURT-LAHOREBookmark this Case Mst. RAZIA BEGUM VS PUBLIC AT LARGE Nominee---Meaning and scope---A "nominee" is typically defined as a person or entity designated to act on behalf of another, particularly in legal or financial matters---Nominee may hold assets for the benefit of the actual owner, indicating a fiduciary relationship---Nominee is "a party who holds bare legal title for the benefit of others or who receives and distributes funds for the benefit of others"; "nominee" is "a person who has been formally suggested for a job, a prize etc. Citation Name: 2025 CLD 122 LAHORE-HIGH-COURT-LAHOREBookmark this Case Mst. RAZIA BEGUM VS PUBLIC AT LARGE S. 72---Life Insurance Policy, proceeds of---Tarka---Nominee assigned by the deceased---Scope and effect---Deceased in his lifetime purchased an insurance policy wherein he nominated his wife as his nominee---Mother of the deceased filed an application for issuance of succession certificate, which was concurrently declined---Claim of the petitioner (being mother of the deceased) was that she was entitled to inherit 1/6th share of the insurance policy amount, whereas, respondent (wife/widow) denied her right on the ground that being nominee she was solely entitled to receive the whole insurance policy amount---Deceased left behind mother (petitioner), widow (respondent/ nominee), a daughter and two sons (respondents)---Courts below non-suited the petitioner on the ground that the amount of the Insurance Policy did not fall within the ambit of "Tarka", and was not liable to be inherited by the legal heirs and only the nominee was entitled to receive the amount of said Life Insurance Policy---Legality---Concept of nominee is alien to Muslim Law, according to which the legal heirs are the only persons entitled to receive the property left by their predecessor and no Muslim heir can exclude the other heir on the ground that he is a nominee---A nominee, if appointed, does not become the sole owner of the assets left by the deceased but he/she is only authorized to collect the amount or to hold the property of the deceased as an administrator and then to distribute the same amongst all the legal heirs---The nomination does not make the nominee as donee nor the nomination amounts to a gift, in the absence of delivery of possession of the property gifted---The nominee cannot claim as exclusive owner the amount of the insurance policy---In the light of Muslim Law of Inheritance, all the legal heirs of the deceased are entitled to receive the property ("Tarka") left by the deceased, according to their shares---Both the Courts below had erred in law while dismissing the succession petition of the petitioner and had failed to properly appreciate the question involved in the lis as the present case relates to Life Insurance Policy and the nominee was appointed by the nominator just to fulfill the legal requirement of S. 72 of the Insurance Ordinance, 2000---High Court set-aside the impugned judgments of the Courts below, and the petitioner, being mother of the deceased, was held entitled to receive her due share out of the policy proceeds---Revision petition, filed by mother of deceased was allowed accordingly. Citation Name: 2025 CLD 122 LAHORE-HIGH-COURT-LAHOREBookmark this Case Mst. RAZIA BEGUM VS PUBLIC AT LARGE S. 72---Life Insurance Policy, proceeds of---Tarka---Nominee assigned by the deceased---Scope and effect---Deceased in his lifetime purchased an insurance policy wherein he nominated his wife as his nominee---Mother of the deceased filed an application for issuance of succession certificate, which was concurrently declined---Claim of the petitioner (being mother of the deceased) was that she was entitled to inherit 1/6th share of the insurance policy amount, whereas, respondent (wife/widow) denied her right on the ground that being nominee she was solely entitled to receive the whole insurance policy amount---Deceased left behind mother (petitioner), widow (respondent/ nominee), a daughter and two sons (respondents)---Courts below non-suited the petitioner on the ground that the amount of the Insurance Policy did not fall within the ambit of "Tarka", and was not liable to be inherited by the legal heirs and only the nominee is entitled to receive the amount of said Life Insurance Policy---Legality---Admittedly, when a person secures Insurance Policy he makes certain payments from time to time as per the schedule from his pocket and on the maturity of Policy in his lifetime, he is entitled to receive the same---Moreover, as per subsection (2) of S. 72 of Insurance Ordinance, 2000, the Policy holder can change the nominee or cancel the nomination at any time before maturity of the policy---It is further provided in the subsection (5) of S. 72 of the Ordinance 2000 that in the event of death of the nominee or the nominees before the policy matures the amounts secured by the policy shall be payable to the legal heirs of the deceased policy holder or legal representatives, or the holder of a succession certificate, as the case may be---It is nowhere mentioned that after the death of nominee the amount would be disbursed amongst the legal heirs or legal representatives of the nominee---Hence, it clarifies that the nomination shall not operate as a gift or will because had the nomination been a gift or will, then after the death of the nominee the amount would devolve on the heirs of nominee rather than the heirs of policy holder---Both the Courts below had erred in law while dismissing the succession petition of the petitioner and had failed to properly appreciate the question involved in the lis as the present case related to Life Insurance Policy and the nominee was appointed by the nominator just to fulfill the legal requirement of S. 72 of the Insurance Ordinance, 2000---High Court set-aside the impugned judgments of the Courts below, and the petitioner, being mother of the deceased, was held entitled to receive her due share out of the policy proceeds---Revision petition, filed by mother of deceased was allowed accordingly.

Mst. RAZIA BEGUM vs PUBLIC AT LARGE S — 2025 CLD 122 LAHORE-HIGH-COURT-LAHORE

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