A recent ruling by the Madras High Court found that fixed deposits (FDs) and jewels are considered property under the Senior Citizen Act, 2007. The court supported the claim made by an elderly woman against her daughter, citing Section 23 of the Act which deals with property transfers, according to a report by Live Law.
The Senior Citizen Act, 2007, stipulates that children or legal heirs have a responsibility to care for their elderly parents. In many cases, elderly individuals may transfer or gift their assets to their children with the expectation that they will provide for their needs in old age. However, if the children or legal heirs fail to fulfill this obligation, the Act allows for the assets or property to be reclaimed.
The case
As per the case details, the mother initially raised a complaint with the District Collector against her daughter for failing to provide maintenance, but did not receive any resolution. Subsequently, the mother sought relief by approaching the Madras High Court to challenge the decision.
According to the mother, her late husband had held two Fixed Deposits worth Rs 80 lakh and Rs 90 lakh, for which she was listed as the nominee.
After his demise, she had the deposits transferred to her own name. However, her daughter and son had previously agreed to evenly divide all assets, including the aforementioned Fixed Deposits, and to continue paying the interest to their mother.
Despite this, the daughter deceptively obtained the mother's signature to transfer the Fixed Deposits into her own name and ceased the interest payments meant for the mother.
Court’s observation
The court observed that the FDs were unlawfully transferred to the daughter, who has failed to pay the interest on them to her mother as agreed upon in the MoU. Furthermore, the court emphasized that Section 23 must be interpreted considering the actions of the settlor (mother). Despite transferring the deposits to her children, the mother expected to be taken care of in return. The court highlighted the daughter's failure to uphold her promises as the settlee.
The court said: "The intention of the Legislature and terms of the Act would declare certain transfers as void, taking note of the fact that by taking advantage of the emotionally dependent senior citizens, relatives grab the property on the pretext of providing emotional support. Therefore, the Legislature thought that such a transaction could be declared void, as the conduct leading to the transaction was based on malice or fraud. Therefore, the condition referred under Section 23 has to be understood based on the conduct of the settlor and not with reference to the specific stipulation in the deed of transfer”.
Senior Citizens Act, 2007
In Section 23 of the Act, the circumstances under which a property transfer may be considered void are outlined. It states that if a senior citizen transfers their property post the enactment of this Act, with the condition that the transferee provides basic amenities and physical needs to the transferor, and the transferee fails to fulfill this obligation, the transfer of property will be considered as having been made fraudulently, coercively, or under undue influence. In such cases, the transferor has the option to have the transfer declared void by the Tribunal.