High Court Exercising Probate Jurisdiction Has Constitutional Power To Order Investigation Into Irregularities In Estate : Supreme Court

The Supreme Court on Monday (May 25) held that a High Court, as a probate court, overseeing the administration of the deceased's estates, is empowered to direct a police investigation after noticing irregularities in the administration of the deceased's estates.The Court held that even while exercising jurisdiction under the Indian Succession Act, the High Court is not denuded of its plenary powers under Article 215 of the Constitution.“…a primary function of the Probate Court is to adjudicate the execution and genuineness of the Will but while doing so if the High Court notices glaring irregularities or there is an element of mischief played by an executor noticed by the High Court then in that situation the High Court cannot be a silent spectator and will have to exercise its plenary and constitutional power to check the mischief so as to protect the property.”, observed a bench of Justice Pankaj Mithal and Justice Prasanna B. Varale.The bench affirmed the Bombay High Court's order directing police investigation into the alleged irregularities in the management and administration of the deceased Mumbai based wealthy Parsi businessman, who left Rs. 100 crores estate behind him, remaining unmarried. “When an estate is brought under the protective umbrella of the Court through the appointment of an Administrator pendente lite under Section 247 of the Indian Succession Act, the Court is dutybound to ensure the estate is not plundered. If the Court discovers that parties are employing deceit, suppressing bank accounts, and using shell trusts to siphon funds, it is entirely within its plenary jurisdiction to direct a police investigation to unearth the fraud.”, the court observed. The Case The case arose out of a testamentary dispute concerning the estate of Purvez Burjor Dalal, a wealthy Parsi businessman from Mumbai, who died unmarried on December 7, 2011, leaving behind assets worth more than ₹100 crores. Following his death, two rival Wills surfaced. One Will dated November 22, 2010 was propounded by Shernaz Faroukh Lawyer and another executor, while a subsequent Will dated September 8, 2011 was propounded by Manek Dara Sukhadwalla, who claimed that the deceased had bequeathed the entire estate for charitable purposes and appointed him as sole executor. In view of the conflicting claims, testamentary suits were filed before the Bombay High Court. During the pendency of the proceedings, the High Court appointed an Administrator pendente lite under Section 247 of the Indian Succession Act, 1925, to safeguard and manage the estate. While administering the estate, the Administrator discovered that shortly after the death of the testator, Sukhadwalla had opened a bank account in the name of the “Estate of Purvez Burjor Dalal” and transferred substantial amounts from it, including ₹15 lakh to Bai Avabai Hormusji Tata Trust and ₹17.08 lakh to another private entity. The Administrator alleged that the transactions were part of a larger conspiracy involving diversion and siphoning of estate funds through interconnected entities allegedly linked to Sukhadwalla and one Jamsheed Minocher Panday. Suspicious circumstances, including common addresses and financial dealings among multiple entities, were brought to the notice of the Court. Considering the seriousness of the allegations and alleged non-cooperation by the parties involved, the Bombay High Court directed a court-monitored criminal investigation into the matter. The said directions were challenged before the Supreme Court. Decision Refusing to interfere with the impugned order, the judgment authored by Justice Varale rejected the Appellant's contention that being a self-contained statute the ISA doesn't empowers the probate court to launch a criminal investigation into the matter. Instead, the Court said that the Indian Succession Act regulates estate administration but does not grant immunity against criminal offences such as forgery, conspiracy, or criminal breach of trust. The Court noted that once an Administrator pendente lite is appointed, the estate becomes “in custodia legis”, meaning in the custody of the law, and the Court becomes duty-bound to preserve and protect it from dissipation. Therefore, if any irregularities were brought into the probate court's notice, it is not deprived to issue an order regarding the launching of criminal investigation. “It is true that the primary function of a Probate Court is to adjudicate upon the due execution and genuineness of a Will. However, this does not mean that a High Court, while sitting in its testamentary jurisdiction, is denuded of its constitutional powers”, the court observed. “The conduct of the appellants and the associated entities reveal a concerted, deceitful effort to frustrate the Administrator's mandate and dissipate the estate of Late Purvez Burjor Dalal. The High Court was perfectly justified in refusing to be a mute spectator to this blatant abuse of process. The invocation of...

High Court Exercising Probate Jurisdiction Has Constitutional Power To Order Investigation Into Irregularities In Estate : Supreme Court

Yash Mittal

The Court affirmed the High Court's direction for a police investigation into the administration of the estate of a Parsi businessman.

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Yash Mittal

High Court Exercising Probate Jurisdiction Has Constitutional Power To Order Investigation Into Irregularities In Estate : Supreme Court

Yash Mittal

The Court affirmed the High Court's direction for a police investigation into the administration of the estate of a Parsi businessman.

This is a premium content Available exclusively to Our subscribers

INR 1099+GST

Tags

Yash Mittal

This is a premium content
Available exclusively to
Our subscribers