JUDGEMENT
Janardan Sahai, J. -
(1.) This is an application for review of the judgment of Hon'ble D.C. Srivastava, J. The plaintiff
Abdul Qayum Khan filed suit for declaration against the defendant Ashiq Husain, that he is the
only son and heir of the deceased Jan Mohammad. The dispute related to entitlement to the
provident fund of the deceased Jan Mohammad. The plaintiff claimed the sums on the basis of
being son of the deceased while the defendant claimed to be real brother and also relied on a
nomination made in his favour by the deceased. The question which arose for determination in
the second appeal was. whether the nomination will prevail or the plaintiff being son had a right
of declaration in respect of the said sums. It was held by this Court that relying upon decision of
the Supreme Court in AIR 1984 SC 346, that the nominee does not have a right to appropriate
the moneys of the provident fund but the heirs have a right to the said fund.
(2.) In support of this review application, Sri Sankatha Rai counsel of the applicants contends that
this Court did not consider the effect of the provisions of Section 5 of the Provident Fund Act,
1925 and as such, the judgment of this Court is liable to be reviewed. He has relied upon various
decisions that in case a statutory provision is over-looked in a judgment, it construes a valid
ground of review. There can he no quarrel with this proposition and as such, it is not necessary to
consider the cases cited by Sri Rai on this point. It is true that the provisions of Section 5 (1) of
the Provident Fund Act have not been considered in so many words by this Court in the
judgment under review, as such the contention of Mr. Rai is being dealt with.
(3.) In support of his contention. Mr. Rai has relied on a Full Bench Decision of the Oudh Chief
Court in Mohd. Naim and another v. Mt. Munimunnissa, AIR 1936 Oudh 32. By a majority of
two Judges, it was held that Section 5 of the Provident Fund Act conferred right upon the
nominee to deal with the moneys due under the provident fund in his own way. It was held that
the declaration under the Provident Fund Act made by the deceased operated as a Will and as
such the personal law of the depositor would give way to the declaration made in the provident
fund and the nominee was entitled to receive the money absolutely. Section 5 (1) of the
Provident Fund Act as it stood at the time when the matter was considered by the Full Bench
may be quoted as below :
"Subject to the provisions of this Act, but otherwise notwithstanding anything contained in any
law for the time being in force or any disposition whether testamentary or otherwise, by a
subscriber to, or depositor in, a Government of Railway Provident Fund of the sum standing to
his credit in the Fund, or of any part thereof, any nomination, duly made in accordance with the
rules of the Fund, which purports to confer upon any person the right to receive the whole or any
part of such sum on the death of the subscriber or depositor, shall be deemed to confer such right
absolutely, until such nomination is varied by another nomination made in the like manner or is
expressly cancelled by the subscriber or depositor by notice given in such manner and to such
authority as is prescribed by those rules."
This Section has now been amended. Section 5 (1) as it stands after the amendment may now be
reproduced as under :
"5 (1) Notwithstanding anything contained in any law for the time being in force or in any
deposition, whether testamentary or otherwise, by a subscriber to or depositor in a Government
or Railway Provident Fund of the sum standing to his credit in the Fund, or of any part thereof,
where any nomination, duly made in accordance with the rules of the Fund, purports to confer
upon any person the right to receive the whole or any part of such sum on the death of the
subscriber or depositor occurring before the sum has become payable or before the sum having
become payable, has been paid, the said person shall, on the death as aforesaid of the subscriber
or depositor, become, entitled to the exclusion of all other persons, to receive such sum or part
thereof, as the case may be, unless
(a) such nomination is at any time varied by another nomination made in like manner or
expressly cancelled by notice given in the manner and to the authority prescribed by those rules,
or
(b) such nomination at any time becomes invalid by reason of the happening of some
contingency specified therein,-and
if the said person predeceases the subscriber or depositor, the nomination shall, so far as it
relates to the right conferred upon the said person, become void and of no effect :
Provided that where provision has been duly made in the nomination in accordance with the
rules of the Fund, conferring upon some other person such right in the stead of the person
deceased, such right shall, upon the decease as aforesaid of the said person, pass to such other
person."
Sri Sankatha Rai contended that on a proper interpretation of Section 5 (1), the nominee would
be deemed to have received the provident fund money as absolute owner. He gives two reasons
in support of his contention. The first reason according to him, is that section opens with a
non-obstante clause and, therefore, overrides the personal law of succession. The second reason
given by him is that under the section, the nominee becomes entitled to receive the sum to the
exclusion of all other persons. It is contended that the effect of the exclusion clause would be
that the heirs of the deceased would have no right over the provident fund. In M. Malati and
others v. M. Dharma Rao and another. AIR 1968 Ori 8, it was held that there is nothing in
Sections 3. 4 and 5 of the Provident Fund Act to indicate that the nominee receives the amount
for the benefit of depositor's heirs or dependants. The Orissa High Court after noticing the
divergent opinion expressed upon the interpretation of Section 5 has taken the view that the
nominee receives the amount as absolute owner.;