2006 (5) TMI 556 - HC - Indian Laws

Court Appoints Joint Administrator for Deceased's Shareholding

Priyambada Debi Birla Versus Ajoy Kumar Newar and Ors.

The court appointed a Joint Administrator pendente lite comprising four individuals to oversee the deceased's shareholding in all companies, conduct ... - Issues Involved:1. Appointment of Administrator pendente lite (APL)2. Validity and genuineness of the Will and Codicil3. Allegations of undue influence and suspicious circumstances4. Necessity and grounds for appointing an APL5. Conduct and credibility of the executor6. Legal principles and precedents for appointing an APLIssue-wise Detailed Analysis:1. Appointment of Administrator pendente lite (APL):The applications for appointing an APL were filed by the defendants, challenging the executor's control over the estate. The court considered the vastness of the estate and the serious challenge to the Will and the executor's appointment. The court concluded that the estate was in 'medio,' meaning there was no legal representation of the estate, necessitating the appointment of an APL to manage and control the estate during the pendency of the probate proceedings.2. Validity and genuineness of the Will and Codicil:The defendants challenged the Will and Codicil, alleging they were manufactured and procured documents. They argued that the disposition was unnatural, excluding family members and giving all properties to the executor, a paid employee. The court noted that the challenge to the Will's genuineness and the executor's appointment was serious and bona fide, warranting careful consideration.3. Allegations of undue influence and suspicious circumstances:The defendants alleged that the executor exercised undue influence over the deceased, who was in poor health and dependent on him. They cited suspicious circumstances, such as the unnatural disposition of the estate, the executor's substantial benefit, and the change of lawyer for preparing the Will. The court found these allegations to be serious and supported by prima facie evidence, making it unsafe to leave the estate in the executor's hands.4. Necessity and grounds for appointing an APL:The court emphasized the necessity of appointing an APL due to the vast and valuable estate, the serious challenge to the Will, and the executor's conduct. The court referred to legal principles and precedents, highlighting that the appointment of an APL is discretionary and should be based on the necessity to protect and preserve the estate. The court found that the executor's actions and the ongoing litigations created a strong case for appointing an APL.5. Conduct and credibility of the executor:The executor's conduct was scrutinized, including his hasty actions to gain control of the companies and his failure to disclose and collect all assets of the deceased. The court noted that the executor was facing criminal prosecution and had acted in a manner that raised doubts about his trustworthiness and competence. The court concluded that the executor's conduct and the allegations against him justified his displacement and the appointment of an APL.6. Legal principles and precedents for appointing an APL:The court referred to various legal principles and precedents, including English and Indian case law, to support its decision. The court highlighted that the appointment of an APL is guided by the principles of necessity, the seriousness of the challenge to the Will, and the need to protect and preserve the estate. The court emphasized that the executor's appointment should be questioned if there are serious allegations and the estate is vast and valuable.Conclusion:The court appointed a Joint Administrator pendente lite consisting of four individuals to take charge and control of the deceased's shareholding in all companies, make necessary inquiries, and manage the estate during the probate proceedings. The executor was directed to hand over all charges to the appointed administrators. The court also granted a conditional stay of the judgment for three weeks, allowing the executor to act as a director or chairman with his own qualifying shareholding, if appointed.