nomination

This query is : Resolved

jabesh (Querist)
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14 May 2010 My uncle expired in Dec 2009. He had nominated me for his fixed deposits which comes to around 4000000. For his other investments he had nominated my mother ( his sister ) and my other uncle ( his brother )
I have contacted the bank and received all the FD with interest in my account. Till now his brothers and sisters all together has not come to me asking their share. I will like to mention that he was unmarried and his parents or grand parents are not alive. This makes his 2 brother and 2 sister as his legal heir.
As there are centain issues to be settled in the business of his, the settlement may take even a year or so. Thus till that the amount is going to be with me.
Now I have the following doubts:
1. I have again invested the FD amount received with the interest in the bank in my name which comes to around 4300000. Now my problem is the bank deducts TDS on the interest and issues TDS certificates. How do I account it? If I claim the TDS, then even the interest I have to show as my income, which is not actually the fact. If I forgo the TDS deducted, then the IT dept. may think I am doing so because the amount may be unaccounted money and my file can come under their scan.
2. I even want to know that, when I split the amount among the legal heirs, do I have to split 4300000 only or they have the right on even the amount earned as interest on the 4300000? Because I had received only 4300000 as the nomination amount, whatever earned or lossed on the amount is my headach. If they have the right on the amount earned on 4300000, what if I say I had invested the same in shares etc. and made a loss of 1000000 and now I can split on 3300000 between them?
Kindly let me know how I have to do the justice. I never want a single paise from their share, but I don’t want to give any money from my pocket also, nor want to get in to trouble with the IT dept. my mail id is: visitjabs@gmail.com

PHANI

PHANI (Expert)
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17 May 2010 Hi Jabesh,

In the first instance I would like to know the purpose for which your uncle has chosen you as the nominee and not his brother or sister. Normally if a person nominates someone as the nominee then his intention is that if any thing unforeseen happens in the future the nominee would be the owner of the funds. Have some other doubts in your case, so do send across a mail in case you wish any assistance. We are a practicing CA's in hyderabad. Our mail id is spassociates9@gmail.com. I will send a test mail to your gmail id.