The Supreme Court of India has held that a High Court, while exercising its testamentary jurisdiction, does not cease to be a Constitutional Court of record and retains its inherent and plenary powers to direct a court-monitored criminal investigation to safeguard an estate in custody of the court (in custodia legis) from being plundered.
A division bench of Justice Pankaj Mithal and Justice Prasanna B. Varale dismissed a batch of civil appeals filed by the Bai Avabai Hormusji Tata Trust, challenging the judgment of the Division Bench of the Bombay High Court dated July 16, 2024. The High Court had upheld a Single Judge’s order dated December 21, 2018, which directed the Administrator of the estate of the deceased testator to lodge a criminal complaint with the Mumbai Police Commissioner to investigate a conspiracy to siphon off estate funds.
Background of the Case
The dispute concerns the estate of Purvez Burjor Dalal, a Parsi Zoroastrian bachelor who passed away on December 7, 2011, leaving behind substantial movable and immovable properties valued at over Rs. 100 Crores. Following his death, two rival Wills surfaced:
- A Will dated November 22, 2010, propounded by Shernaz Faroukh Lawyer (Respondent No. 1) and her late mother, Villy Pirojsha Avasia (Respondent No. 2), who claimed to be executrices and beneficiaries.
- A subsequent Will dated September 8, 2011, propounded by Manek Dara Sukhadwalla, who claimed the entire estate was bequeathed for charitable purposes and appointed him as the sole executor.
Both parties filed testamentary petitions for probate, which were converted into Testamentary Suits No. 29 of 2012 and No. 25 of 2012 respectively.
On December 24, 2013, a learned Single Judge of the Bombay High Court appointed Mr. Jonathan Solomon as the Administrator pendente lite of the estate under Section 247 of the Indian Succession Act, 1925 (ISA). The Administrator subsequently discovered that prior to his appointment and shortly after the testator’s death, Mr. Sukhadwalla had opened a bank account in the name of the “Estate of Purvez Burjor Dalal” with Kotak Mahindra Bank and transferred:
- Rs. 17,08,147/- to M/s. Amoha Traders Private Limited (Amoha) on March 24, 2012.
- Rs. 15,00,000/- to the appellant, Bai Avabai Hormusji Tata Trust for Charitable Objects, on April 11, 2012.
The Administrator’s inquiries revealed that the Bai Avabai Hormusji Tata Trust, Amoha Traders, and other involved entities (such as Kratos Energy and Canos Trading) shared common addresses, telephone numbers, and email contacts linked to one Jamsheed Minocher Panday (Jimmy Panday). It was also discovered that Canos Trading, a company in which Mr. Sukhadwalla held shares, had purportedly advanced a loan of over Rs. 69 Lakhs to the deceased testator in 2015—four years after his death. Furthermore, while Mr. Sukhadwalla claimed the appellant Trust was established by industrialist Naval Tata in 1954, documents produced by the respondents suggested it was a dormant Parsi family trust created in 1943, which was revived in 2011 to facilitate the transactions.
Citing significant non-cooperation and “obstructive” and “deceitful” conduct by Mr. Sukhadwalla and the associated entities, the Single Judge, on December 21, 2018, invoked the High Court’s inherent and plenary jurisdiction as a Court of record under Article 215 of the Constitution. The Court directed the Administrator to draw up a criminal complaint, file it through the Prothonotary and Senior Master of the High Court, and forward it to the Commissioner of Police, Mumbai, for a court-monitored investigation. The Division Bench of the Bombay High Court dismissed the intra-court appeals against this order on July 16, 2024.
Arguments of the Parties
Appellants’ Contentions
The appellants (Bai Avabai Hormusji Tata Trust, along with connected appellants before the High Court) argued that:
- A Testamentary Court’s jurisdiction is strictly limited to examining the genuineness and due execution of a Will, relying on Kanwarjit Singh Dhillon v. Hardyal Singh Dhillon (2007) 11 SCC 357. It cannot direct a “phishing and roving” criminal investigation.
- The ISA, 1925 is a complete and self-contained code, as established in Fuerst Day Lawson Ltd. v. Jindal Exports Ltd. (2011) 8 SCC 333. If intermeddling was alleged, specific statutory remedies under Sections 192, 208, or 269 of the ISA should have been pursued.
- Under Sections 211, 227, and 307 of the ISA, an executor is competent to deal with the estate even prior to the grant of probate. Therefore, the transfers to Amoha and the Trust were not illegal ab initio.
- The High Court bypassed the mandatory preliminary inquiry required under Section 340 of the Code of Criminal Procedure (CrPC).
- Police machinery cannot be used as a recovery agent or a tool to collect evidence for private civil litigants.
Respondents’ Contentions
The respondents (original plaintiffs and the Administrator) countered that:
- The High Court does not lose its character as a Constitutional Court of record under Article 215 of the Constitution when sitting in its testamentary jurisdiction.
- When the estate is in medio (in the custody of the Court via an Administrator), no self-styled executor can unilaterally deal with the property.
- The executor colluded with Jimmy Panday to siphon funds through entities sharing common addresses and contacts.
- The obstructive and deceitful conduct of the appellants left the Court with no alternative but to order an investigation to trace the siphoned assets.
- The direction was not strictly under Section 340 of the CrPC, but an exercise of the Court’s inherent power to address non-cooperation with its appointed officer. No actual prejudice is caused to the appellants as they will have an opportunity to defend themselves if prosecuted.
The Court’s Analysis
The Supreme Court rejected the appellants’ submissions and affirmed the rulings of the Bombay High Court.
Status of the Administrator and Estate ‘In Custodia Legis’
The Court emphasized that an Administrator appointed under Section 247 of the ISA is an officer and the “hand of the court,” whose position is similar to that of a receiver. Relying on Pandurang Shamrao Laud v. Dwarkadas Kalliandas (1932) and Anthony C. Leo v. Nandlal Bal Krishnan (1996) 11 SCC 376, the Court observed that the estate is in custodia legis. The Court noted:
“If for such preservation, action in civil or criminal court is necessary, the receiver is to draw the attention of the court of relevant facts necessitating such legal action and take leave of the court to institute appropriate legal proceedings for the preservation of the property.”
Plenary Powers of the High Court as a Court of Record
The Court rejected the argument that testamentary jurisdiction denudes the High Court of its constitutional powers. Invoking M.V. Elisabeth v. Harwan Investment & Trading Pvt. Ltd. (1993 Supp (2) SCC 433), the bench reiterated that High Courts are superior Courts of Record possessing inherent and plenary powers:
“…where statutes are silent and remedy has to be sought by the courts to basic principles, it is the duty of the Court to devise procedural rules by analogy and expediency.”
Addressing the High Court’s duty, the Supreme Court held:
“…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.”
The Court also observed that under Section 269 read with Section 300 of the ISA, the High Court has concurrent jurisdiction with the District Judge to interfere for the protection of properties incurring risk of loss or damage, and because the deceased was a Parsi, the bar under Section 269(2) did not apply.
Executor’s Authority and Siphoning of Funds
The Supreme Court strongly condemned the actions of the propounded executor, clarifying the limits of an executor’s pre-probate authority under the ISA:
“While an executor derives his authority from the Will, such authority is not a license to plunder. Where two rival Wills are propounded and the matter is fiercely contested, the estate is in custodia legis or in medio, an executor of a disputed Will cannot unilaterally start disposing of the estate’s cash assets to dormant trusts connected to his associates.”
The Court remarked that the suspicious revival of the dormant 1943 trust in 2011 to receive estate funds was a “classic hallmark of intermeddling and siphoning.”
Applicability of Section 340 of the CrPC
The Court ruled that the High Court did not bypass Section 340 of the CrPC. It clarified that the direction for a criminal investigation was not passed strictly for an offence affecting the administration of justice within the courtroom (such as perjury alone), but was an exercise of broader inherent powers to investigate a larger conspiracy of siphoning through fraudulent banking transactions. The Court further noted that under Section 340(3)(a), where the complaining court is a High Court, it is permissible for an officer of the High Court registry to make the complaint.
The Court cited the Delhi High Court’s ruling in Sanjeev Kumar Mittal v. The State (2010) to establish that when a massive fraud on the court or estate comes to light, the Court is well-empowered to direct a state agency to investigate and report.
The Decision
The Supreme Court concluded that the appeals were entirely devoid of merit. Upholding the High Court’s orders, the bench noted:
“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 Article 215 of the Constitution to direct a court-monitored investigation was not only legally sound but absolutely necessary to protect the estate in medio and uphold the majesty of the law.”
The Court clarified that the appellants suffer no actual or substantive prejudice by the mere initiation of an investigation, and they will have every opportunity to place their records before the investigating agency.
The appeals were dismissed, and the competent investigating authority was directed to proceed with the investigation expeditiously and submit progress reports as directed by the High Court.
Case Details
- Case Title: Bai Avabai Hormusji Tata Trust v. Shernaz Faroukh Lawyer & Ors. (with connected appeals)
- Case No.: Civil Appeal No(s). ______ of 2026 (Arising out of Special Leave Petition (Civil) No(s). 25107 of 2025)
- Bench: Justice Pankaj Mithal and Justice Prasanna B. Varale
- Date: May 25, 2026
