Power to nominate
Section 72 of the Companies Act, 2013 deals with power to nominate. Every holder of securities of a company may, at any time, nominate, in the prescribed manner, any person to whom his securities shall vest in the event of his death. The Act came into force on 01 Apr 2014.
(1) Every holder of securities of a company may, at any time, nominate, in the prescribed manner, any person to whom his securities shall vest in the event of his death.
(2) Where the securities of a company are held by more than one person jointly, the joint holders may together nominate, in the prescribed manner, any person to whom all the rights in the securities shall vest in the event of death of all the joint holders.
(3) Notwithstanding anything contained in any other law for the time being in force or in any disposition, whether testamentary or otherwise, in respect of the securities of a company, where a nomination made in the prescribed manner purports to confer on any person the right to vest the securities of the company, the nominee shall, on the death of the holder of securities or, as the case may be, on the death of the joint holders, become entitled to all the rights in the securities, of the holder or, as the case may be, of all the joint holders, in relation to such securities, to the exclusion of all other persons, unless the nomination is varied or cancelled in the prescribed manner.
(4) Where the nominee is a minor, it shall be lawful for the holder of the securities, making the nomination to appoint, in the prescribed manner, any person to become entitled to the securities of the company, in the event of the death of the nominee during his minority.
Section 72, The Companies Act, 2013 (Act 18 of 2013).
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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Shakti Yezdani vs Jayanand Jayant Salgaonkar
Court's Decision & Legal Precedent
A nominee of shares or securities does not obtain absolute beneficial ownership of the assets upon the owner's death; such securities form part of the estate of the deceased and are subject to the general laws of succession.
On this section: Equivalent of Section 109A and 109B of the 1956 Act.
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Judgments citing this section
These may be obiter dicta or a precedent, for you to study. These are the judgments where this section is quoted.
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… SCHEME OF THE COMPANIES ACT 20. Both sides' lawyers have relied on the intent & purpose behind the introduction of S. 109A & S. 109B in the larger context of the Companies Act, 1956 or the pari materia provisions ( Section 72, Companies Act, 2013 ) in support of their respective stand. Having perused the scheme behind the Companies Act, 1956 and the Companies (Amendment) Act, 1999 that also introduced S. 109A & S. 109B of the Companies Act, 1956 , the relevant extracts are reproduced as follows: " …………….2. (b) to provide for …
Made under this section, and citing it
1 instrument states that it was made under this provision — the power to make it comes from here, so a change to any of them changes what this section requires in practice. Newest first.
Another 3 instruments name this provision in its title or its text without being made under it.
Questions about Section 72
What have the courts held on Section 72 of the Companies Act?
Shakti Yezdani vs Jayanand Jayant Salgaonkar (14 Dec 2023) is the leading judgment on this section among those set out below: Equivalent of Section 109A and 109B of the 1956 Act.
How do I find court cases under Section 72 of the Companies Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: Companies Act 72, section 72 Companies Act, section 72 of the Companies Act. People searching for it also type companies act 72 of 2008. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 1 reported judgment on this section is set out on this page, beginning with Shakti Yezdani vs Jayanand Jayant Salgaonkar (14 Dec 2023).
What should I read with Section 72 of the Companies Act, and has it changed?
The rules and notifications made under it are where it actually bites, and there is one: most recently G.S.R. NO. 43(E) Companies share capital and debentures amendment rules 2023 dated 21.01.2023 (2023).
When did Section 72 of the Companies Act come into force?
Section 72 of the Companies Act, cited as Companies Act 72, came into force on 01 Apr 2014, having been enacted on 29 Aug 2013. It is in force as at the date shown on this page.
Other sections of this Act
- 2. Definitions5089 words
- 143. Powers and duties of auditors and auditing standards1867 words
- 230. Power to compromise or make arrangements with creditors and members1432 words
- 232. Merger and amalgamation of companies1416 words
- 149. Company to have Board of Directors1403 words
- 217. Procedure, powers, etc., of inspectors1390 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 15 Oct 2026. This page is not a substitute for legal advice.