Where a thing specifically bequeathed undergoes a change between the date of the will and the testator's death, and the change takes place by operation of law, or in the course of execution of the provisions of any legal instrument under which the thing bequeathed was held, the legacy is not adeemed by reason of such change.
Illustrations:
A bequeaths to B "all the money which I have in the 51/2 per cent. loan of the. Central Government". The securities for the 51/2 per cent. loan are converted during A's lifetime into 5 per cent. stock. A bequeaths to B the sum of 2,000 f invested in Consols in the names of trustees for A. The sum of 2,000 transferred by the trustees into A's own name.
A bequeaths to B the sum of 10,000 rupees in promissory notes of the Central government which he has power under his marriage settlement to dispose of by will. Afterwards, in A's lifetime, the hind is converted into Consols by virtue of an authority contained in the settlement. No one of these legacies has been adeemed.
Legal Commentary & Landmark Judgments: Section 163
Section 163 provides that where the subject-matter of a specific bequest is changed by operation of law between the date of the will and the testator's death, the legacy is not adeemed.
If a testator bequeathed shares in a bank that was subsequently merged under an RBI/government scheme into another bank, cite Section 163; the legatee is entitled to the substituted shares in the merged entity without ademption.