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Section 170 Succession Act 1925: Exoneration of specific legatee’s stock in joint-stock company

Section 170 (Exoneration of specific legatee’s stock in joint-stock company) under Chapter XVII (Of the payment of liabilities in respect of the subject of a bequest) of Part VI (Testamentary Succession) of the Indian Succession Act, 1925

❝In the absence of any direction in the will, where there is a specific bequest of stock in a joint-stock company, if any call or other payment is due from the testator at the time of his death in respect of the stock, such call or payment shall, as between the testator's estate and the legatee, be borne by the estate; but, if any call or other payment becomes due in respect of such stock after the testator's death, the same shall, as between the testator’s estate and the legatee, be borne by the legatee, if he accepts the bequest.

Illustrations

 (i) A bequeaths to B his shares in a certain railway. At A’s death there was due from him the sum of 100 rupees in respect of each share, being the amount of a call which had been duly made, and the sum of five rupees in respect of each share, being the amount of interest which had accrued due in respect of the call. These payments must be borne by A’s estate.

 (ii) A has agreed to take 50 shares in an intended joint-stock company, and has contracted to pay up 100 rupees in respect of each share, which sum must be paid before his title to the shares can be completed. A bequeaths these shares to B. The estate of A must make good the payments which were necessary to complete A’s title.

 (iii) A bequeaths to B his shares in a certain railway. B accepts the legacy. After A's death, a call is made in respect of the shares. B must pay the call.

 (iv) A bequeaths to B his shares in a joint-stock company. B accepts the bequest. Afterwards the affairs of the company are wound up, and each shareholder is called upon for contribution. The amount of the contribution must be borne by the legatee.

 (v) A is the owner of ten shares in a railway company. At a meeting held during his lifetime a call is made of fifty rupees per share, payable by three instalments. A bequeaths his shares to B, and dies between the day fixed for the payment of the first and the day fixed for the payment of the second instalment, and without having paid the first instalment. A’s estate must pay the first instalment, and B, if he accepts the legacy, must pay the remaining instalments.❞




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Notes:

The Indian Succession Act, 1925 was amended by from time to time by:
- the Indian Succession (Amendment) Act, 1926 (37 of 1926);
- the Indian Succession (Second Amendment) Act, 1926 (40 of 1926);
- the Repealing and Amending Act, 1927 (10 of 1927);
- the Repealing Act, 1927 (12 of 1927);
- the Indian Succession (Amendment) Act, 1927 (18 of 1927);
- the Indian Succession (Amendment) Act, 1928 (14 of 1928);
- the Indian Succession (Amendment) Act, 1929 (18 of 1929);
- the Transfer of Property (Amendment) Supplementary Act, 1929 (21 of 1929);
- the Indian Succession (Amendment) Act, 1931 (17 of 1931);
- the Amending Act, 1934 (35 of 1934);
- the Government of India (Adaptation of Indian Laws) Order, 1937;
- the Repealing Act, 1938 (1 of 1938);
- the Indian Succession (Amendment) Act, 1939 (17 of 1939);
- the Berar Laws Act, 1941 (4 of 1941);
- the Indian Independence (Adaptation of Central Acts and Ordinances) Order, 1948;
- the Indian Succession (Amendment) Act, 1949 (35 of 1949);
- the Adaptation of Laws Order, 1950;
- the Part B States (Laws) Act, 1951 (3 of 1951);
- the Repealing and Amending Act, 1952 (48 of 1952);
- the Repealing and Amending Act, 1953 (42 of 1953);
- the Union Territories (Laws) Amendment Act, 1956 (68 of 1956);
- the Indian Succession (Amendment) Act, 1957 (34 of 1957);
- the Indian Succession (Amendment) Act, 1962 (16 of 1962);
- the Repealing and Amending Act, 1964 (52 of 1964);
- the Delegated Legislation Provisions (Amendment) Act, 1983 (20 of 1983);
- the Indian Succession (Amendment) Act, 1991 (51 of 1991);
- the Repealing and Amending Act, 2001 (30 of 2001);
- the Indian Succession (Amendment) Act, 2002 (26 of 2002).

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