Holding

In an administration suit of an intestate estate, the court may examine transactions of the deceased and implead parties to those transactions as necessary parties.

Summary

Respondent No.1 filed an administration suit to administer the intestate estate of his deceased parents. During the suit he sought to amend the plaint to implead the appellants, alleging that two properties had been alienated to a company and to the appellants during the parents' lifetimes. The Bombay High Court allowed the amendment and impleadment, which the appellants contested. The Supreme Court examined whether a court in an administration suit for an intestate deceased may scrutinise transactions entered into by the deceased and whether third parties to such transactions can be impleaded as necessary parties. It held that the court may indeed examine such transactions and that impleadment of the appellants was proper. Consequently, the High Court’s order was affirmed and the appeal dismissed.

Issues considered

Whether transactions entered into by a deceased intestate during his lifetime can be questioned in an administration suit.
Whether third parties to such transactions are necessary parties and may be impleaded in the suit.

Legislation cited

Code of Civil Procedure, 1908s. Order VI Rule 17

Subjects

administration suitintestate estateimpleadmenttransaction scrutinyCode of Civil Procedureestate administrationamendment of plaintnecessary parties

Judgment

[2008] 14 S.C.R. 525

-~ BABULAL KHANDELWAL & ORS. A
v.
BALKRISHAN D. SANGHVI & ORS.
(Civil Appeal No. 6124 of 2008)
OCTOBER 16, 2008
B
[ALTAMAS KABIR AND MARKANDEY KAT JU, JJ.]

~ Administration suit - Suit filed by Respondent No. 1 for
administration of the Estate of his deceased parents, who died
intestate - Deceased parents of Respondent No. 1, during theirc
lifetime, had entered into transactions with Appellants - High
Court allowed amendment to the plaint and thereby impleaded
Appellants as parties to the suit - Challenge to - Held: The
Court while appointing an Administrator in an administration
suit to administer the Estate of the deceased, who dies intes-
tate, may be required to examine transactions involving prop- D
erties of the Estate to determine assets of the Estate as on
' ~
/
date of death of the owner thereof - Consequently,
impleadment of persons who may be involved in some trans-
action or the other concerning the Estate of the deceased, may
~
become necessary for a decision in an administration suit - E
High Court did not commit any error in allowing amendments
to the plaint which had the effect of impleading Appellants as
parties to the administration suit filed by Respondent No. 1
and permitting Respondent No. 1 to question transactions
entered into by owners of the Estate with third parties - Code F
-1· of Civil Procedure, 1908 - 0. VI, &. 17.

\ The question which arose for consideration in the
present appeal is whether in a suit filed by Respondent
No.1 for administration of the Estate of his deceased par-
ents, who died intestate, transactions entered into and G
concluded by them during their lifetime with Appellants
4 -J.. could not be called into question and the High Court erred
in allowing amendment to the plaint and thereby implead-
ing the Appellants as parties to the said administration suit.
525 H
J

526 SUPREME COURT REPORTS [2008] 14 S.C.R.

A Dismissing the appeal, the Court
HELD:1.1. One is unable to accept objections to the
t--- ~
impleadment of Appellants as necessary parties in the ad-
ministration suit filed by Respondent No.1, particularly
when both his parents had died intestate. [Para 10] [530F]
B
1.2. In an administration suit, the Court, while con-
sidering the grant of authority to an individual having an
interest in the Estate of the deceased to administer the
Estate, has also to determine the extent of the estate of
~
c the deceased at the time of his death to facilitate the dis-
tribution of the estate to all the heirs of the deceased.
During such enquiry the Court is not called upon to de-
termine the right and title of the parties in the properties
of the Estate, but to ascertain the extent of the properties
of the Estate. However in administration suits in respect
D
of a person who dies intestate, the position is different.
The Court while appointing an Administrator in an admin-
istration suitto administer the Estate of the deceased, who
dies intestate, may be required to examine transactions
,.. -
involving the properties of the Estate in order to deter-
E mine the assets of the Estate as on the date of death of
'

the owner thereof. Consequently, the impleadment of per-
sons who may be involved in some transaction or the
other concerning the Estate of the deceased, may become
necessary for a decision in an administration suit. [Para
F 11) [530-G-H, 531-A-C]

1.3. The High Court has correctly indicated that in an
administration suit, the dispute between the parties relat-
ing to the title of the deceased in respect of his proper-
\-.
-
'f
,.
.;__

ties, can be gone into in an administration suit and that ......
G
there is no bar to a Court determining the validity of trans- I

ac~ions allegedly entered into by or on behalf of the de-
ceased, whose Estate is to be administered. In Appendix \ ,_
"D" to the Code of Civil Procedure which deals with the
forms of decrees in different suits, Form 17 indicates the
H
BABULAL KHANDELWAL & ORS. v. BALKRISHAN 527
D. SANGHVI & ORS.

form in which preliminary decrees in Administration Suits A
are to be passed. Paragraph 3 of the Form deals with suits
filed by the next of kin of the deceased who dies intes-
tate, as in the instant case, and provides for an inquiry to
be made and account taken of what or of what share, if
any, the plaintiff is entitled to as next-of-kin in the move- 8
able properties of the Estate. However, if the moveable
properties of the deceased are found to be insufficient
for carrying out the objects of the suit, then by virtue of
paragraph 1O of the Form the Court may order an inquiry
as to what immovable property the deceased was seized
of or entitled to at the time of his death and what encum- C
brances, if any, affect the immovable property of the de-
ceased or any part thereof. The said inquiry might also
include the transactions with the appellants which had
purportedly been concluded by the owners of the prop-
erties themselves during their life time, in order to ascer- D
tain whether the said properties continued to form part of
y the Estate of the deceased at the time of their death. The
High Court had not committed any error in allowing the
amendments to the plaint which had the effect of implead-
ing the appellants as parties to the administration suit filed E
by the respondent No.1 and permitting the respondent
No.1 to question the transactions entered into by the
owners of the Estate with third parties. [Paras 12, 13] [531
F-H, 532 A-E]
Sunil Gupta v. Kiran Girhotra (2007) 8 SCC 506; F
--f Chiranji/al Shrilal Goenka v. Jasjit Singh & Ors. (1993) 2 SCC
507; Ghulam Qadir v. Special Tribunal and Ors.(2002)1 SCC
33 and Krishna Kumar Bir/a v. Rajendra Singh Lodha and
Ors. (2008) 4 SCC 300 - distinguished.
CASE LAW REFERENCE G
(2007) 8 SCC 506 distinguished Para 6
(1993) 2 sec 507 distinguished Para 7
c2002)1 sec 33 distinguished Para 7
(2008) 4 sec 300 distinguished Para 7 H
528 SUPREME COURT REPORTS [2008] 14 S.C.R.

A CIVIL APPELLATE JURISDICTION : Civil Appeal NO.
6124 Of 2008 1--~
From the final Judgment and Order dated 13.2.2006 of
the High Court of Judicature at Bombay in Chamber Summons
No. 1270 of 2005 in Suit No. 457 of 2005
B
Moh it D. Ram and Meenakshi Arora for the Appellants.
S.S. Hariharan and Subramonium Prasad for the Respon-
t-----
dents.
-;-
c The Judgment of the Court was delivered by
ALTAMAS KABIR, J. 1. Leave granted.
2. On 14th February, 2005, the Respondent No'.1,
Balkishan D. Sanghvi, filed suit No. 457 of 2005 in the Bombay
High Court for administration of the Estate of his deceased
D
parents Dwarkadas Sanghvi and Vimlaben Sanghvi, who were
also the parents of the Respondents No.1, 2, 3 and 6~ While the
Respondents Nos. 1, 2 and 6 are the sons of the deceased, the y- 7
'--
Respondent No.3 is their daughter and the Respondents Nos.
4 and 5 are her husband and son respectively.
E
3. During the pendency of the suit, the Respondent No.1/
Plaintiff filed Chamber Summons No.1270 of 2005 for implead-
ing the Appellants herein as parties to the suit and to challenge
the alienation of two properties, ohe to Prolific Consultancy
F Services (Mumbai) Pvt.· Ltd. and the other to the Appellants
herein. By judgment and order dated 13th February, 2006, the
learned Single Judge of the Bombay High Court allowed the ~--
Chamber Summons and permitted the plaint to be amended
as a result whereof the appellants herein stood impleaded as
G defendants Nos. 7 to 12 in the suit on the ground that they were
necessary parties to the suit, despite their objection that the
Respondent No.8 is a company in which the Appellants were
only share-holders and that they were in no way related to any
of the parties to the suit. *
H 4. The amendment of the plaint, also had the effect of al-
BABULAL KHANDELWAL & ORS. v. BALKRISHAN 529
D. SANGHVI & ORS. [ALTAMAS KABIR, J.]
------4
lowing the Respondent No.1 to challenge the transactions con- A
eluded by Dwarkadas Sanghvi and Vimlaben Sanghvi and the
Appellants herein, before their death.
5. Questioning the legality of the order, Ms. Meenakshi
Arora, learned advocate, submitted that in a suit for administra-
tion of the Estate of a deceased, transactions concluded by the B
-·--"\ I deceased during his lifetime cannot be called into question.
Consequently, those with whom such transactions had been
·~
entered into were not necessary parties in such suit. Ms. Arora
submitted that the High Court had committed a fundamental error
in holding that transactions entered into and concluded by the c
deceased during their lifetime could be questioned after their
death in administration proceedings of their Estate, and thereby
erroneously irnpleaded the appellants as parties to the admin-
istration suit.
D
6. In support of her submissions, Ms. Arora firstly referred
: ; -y to the decision of this Court in Sunil Gupta vs. Kiran Girhotra,
[2007 (8) sec 506], where an almost identical question, as
has been raised in this matter, had arisen in respect of a pro-
bate proceeding. The question posed in the said matter was
whether a purchaser of a property belonging to the deceased E
testator should be impleaded as a party in a probate proceed-
ing. While answering the said question, this Court held that since
a probate can be granted only to an Executor appointed by a
Will, a transferee of a property during the pendency of such a
~
proceeding is not a necessary party. F
7. As an offshoot of her main argument, Ms. Arora submit-
ted that, in any event, in a probate proceeding the Court does
not decide ariy question of title in respect of the Estate of the
deceased and any order passed in the proceedings acts as an
G
order in rem. Ms. Arora submitted that even on such score, the
appellants were not necessary parties to the administration suit
and their impleadment in the suit by the High Court was wholly
. erroneous. In support of her said argument, Ms. Arora referred
to and relied upon the judgment of this Court in the case of
H
530 SUPREME COURT REPORTS [2008] 14 S.C.R.

}---
A Chiranjilal Shrilal Goenka vs. Jasjit Singh & Ors. [1993 (2) SCC
507], wherein Ms. Arora's submissions are fully reflected with
approval. Reference was also made to the decision of this Court
in (1) Ghulam Qadir vs. Special Tribunal and Ors.,[2002 (1) SCC
33] and (2) Krishna Kumar Birla vs. Rajendra Singh Lodha and
B Ors. [2008 (4) SCC 300], where the same views have been
expressed.
~-
8. Ms. Arora's submissions were opposed by Mr.
Hariharan and Mr. Subramonium Prasad, learned advocates, ~
who appeared for the respondent No.1. It was submitted that
c when the Estate of a deceased is involved, the Court in seisin
of the proceedings relating to the administration of the said
Estate was entitled to scrutinize transactions which had taken
place in respect of any property forming part of such Estate. It
was s.ubmitted that, in fact, such a course of action was also
D pragmatic as it would eliminate the prospect of multiplicity of
proceedings. 'f r'

9. Mr. Subramonium Prasad submitted that the High Court
had quite correctly allowed the impleadment of the appellants
ii) the suit filed by the respondent No.1 where all questions re-
E lating to and involviPg the Estate of Dwarkadas Sanghvi and
Vimlaben Sanghvi would be resolved with finality.
10. Having considered the rival submissions of the par-
ties; we are unable to accept Ms. Arora's objections to the
r
F impleadment of the appellants as necessary parties in the ad- 't-4)
ministration suit filed by the respondent No. 1, particularly when
both Dwarkadas Sanghvi and Vimlaben Sanghvi had died in-
\
testate.
11. It is well settled that in an administration suit, the Court,
G while considering the grant of authority to an individual having
an interest in the Estate of the deceased to administer the Es- ).
tate, has also to determine the extent of the estate of the de-
ceased at the time of his. death to facilitate the distribution of
the estate to all the heirs of the deceased. It is equally well settled
H that during such enquiry the Court is not called upon to deter-
BABULAL KHANDELWAL & ORS. v. BALKRISHAN 531
D. SANGHVI & ORS. [ALTAMAS KABIR, J.]
----1
mine the right and title of the parties in the properties of the A
Estate, but to ascertain the extent of the properties of the Es-
tate. The decision in Chiranjilal Shrilal Goenka's case (supra),
applies to probate proceedings where it has been held that the
probate Court does not decide any question of title or even the
existence of the property itself. In administration suits in respect B
of a person who dies intestate, the position is different. The
---\
Court while appointing an Administrator in an administration suit
to administer the Estate of the decease, who dies intestate,
may be required to examine transactions involving the proper-
ties of the Estate in order to determine the assets of the Estate c
as on the date of death of the owner thereof. Consequently, the
impleadment of persons who may be involved in some transac-
tion or the other concerning the Estate of the deceased, may
become necessary for a decision in an administration suit. The
High Court has noted this fact while allowing the prayer of the
D
respondent No.1 for impleading the appellants as parties to the
~ '(
administration suit.
12. The decisions cited by Ms. Arora are in relation to Pro-
bate proceedings where either probate is to be granted or Let-
ters of Administration are to be given to an applicant having an E
interest in the Estate of the deceased. The circumstances in an
administration suit where a person dies intestate are, however,
different. The learned Single Judge of the High Court has cor-
rectly indicated that in an administration suit, the dispute be-
..-i tween the parties relating to the title of the deceased in respect F
of his properties, can be gone into in an administration suit and
that there is no bar to a Court determining the validity of trans-
actions allegedly entered into by or on behalf of the deceased,
whose Estate is to be administered. In Appendix "D" to the Code
of Civil Procedure which deals with the forms of decrees in dif-
G
ferent suits, Form 17 indicates the form in which preliminary
~
decrees in Administration Suits are to be passed. Paragraph 3
of the Form deals with suits filed by the next of kin of the de-
ceased who dies intestate, as in the instant case, and provides
for an inquiry to be made and account taken of what or of what
H
532 SUPREME COURT REPORTS [2008] 14 S.C.R.

}--
A share, if any, the plaintiff is entitled to as next-of-kin in the move-
able properties of the Estate. However, if the moveable proper-
ties of the deceased are found to be insufficient for carrying out
the objects of the suit, then by virtue of paragraph 10 of the Form
the Court may order an inquiry as to what immovable property
B the deceased was seized of or entitled to at the time of his death
and what encumbrances, if any, affect the immovable property ' \

of the deceased or any part thereof. The said inquiry, in our
!"--- '
view might also include the transactions with the appellants )._
,-~

herein which had purportedly been concluded by the owners of
c the properties themselves during their life time, in order to as-
certain whether the said properties continued to form part of
the Estate of the deceased at the time of their death.
13. We, therefore, have little hesitation in holding that the
High Court had not committed any error in allowing the amend-
D ments to the plaint which had the effect of impleading the ap-
pellants as parties to the administration suit filed by the respon-
dent No.1 and permitting the respondent No.1 to question the
transactions entered into by the owners of the Estate with third
parties. The order of the High Court does not warrant any inter- , "

E ference and the appeal must, therefore, be dismissed.
14. We, accordingly, dismiss the appeal and affirm the
judgment and order of the High Court allowing the amendments
to the plaint for impleading the appellants as parties to the ad-
ministration suit file:! by the respondent No.1 and for scrutiniz-
F ing the transactions which were alleged to have been concluded
by the parents of the respondent Nos. 1 to 4 during their life-
time.
15. There will, however, be no order as to costs.
G 8.8.B. Appeal dismissed.