1612 R

THE SUPREME COURT OF EBONY

15TH AMITY NATIONAL MOOT COURT COMPETITION, 2016

CIVIL APPEAL NO. ____ /2015

(Under Article 136 of the Constitution of India, 1950; read with Order XXI, Rule 1, Supreme
Court Rules, 2013)

KING DUMAS.. APPELLANT 1

KING DRAGO . APPELLANT 2
KING DRAKSHIN .

APPELLANT 3

v.

PRINCE WILD BILZERIAN...RESPONDENT 1

PRINCESS NORTH BILZERIAN.RESPONDENT 2

MEMORIAL FOR THE RESPONDENTS

TABLE OF CONTENTS

INDEX OF AUTHORITIES..................................................................................................................iv
STATEMENT OF JURISDICTION.......................................................................................................viii
STATEMENT OF FACTS.....................................................................................................................ix
ISSUES INVOLVED..........................................................................................................................xiii
SUMMARY OF ARGUMENTS...........................................................................................................xiv
BODY OF ARGUMENTS.....................................................................................................................1
[I] THE HIGH COURT HAS RIGHTLY EXERCISED ITS JURISDICTION UNDER SECTION 10F WHILE
HEARING AN APPEAL AGAINST SECTION 111..............................................................................1
[A.] The High Court had jurisdiction as there is a question of law..........................................1
[B.] The Refusal of the Company to transfer the shares is arbitrary........................................4
[C.] The High Court had jurisdiction to hear and decide the appeal as it did..........................7
[II] THE HIGH COURT COULD HAVE DECIDED VARIOUS ASPECTS OF THE PRESENT DISPUTE AS
10 OF CODE OF CIVIL PROCEDURE DOES NOT APPLY...................................................................8
[A.] Company Proceedings are not suit under 10 of Code of Civil Procedure...................8
[B.] Alternatively, if Company proceedings are considered to be a suit, even then all the
elements of 10 are not fulfilled..............................................................................................9
[III] THE HIGH COURT COULD HAVE INTERPRETED A WILL WHILE EXERCISING JURISDICTION
UNDER

SECTION 10F...................................................................................................................12

[A.] The interpretation of will is a question of law................................................................13

[B.] It arises out of the order of Company Law Board...........................................................13
[C.] Additionally, Section 111 empowers the court to decide any dispute relating to title....14
IV. THE SUCCESSION CERTIFICATE WAS OPERATIVE, AND COULD HAVE BEEN RELIED UPON BY
THE

HIGH COURT........................................................................................................................15

[A.] There is no statutory provision to invalidate the certificate upon death of a joint-holder.
................................................................................................................................................15
[B.] Prior authorities holding a succession certificate to become inoperative upon death
cannot be relied upon.............................................................................................................17
[V] BY VIRTUE OF THE SETTLEMENT DEED, THE PROBATE PROCEEDINGS INSTITUTED BY
QUEEN KIM STAND LAPSED........................................................................................................19
[A.] Queen Kim no longer pressed her claim under the probate proceedings.......................19
[B.] Application of Order XXIII, Rule 3 of the Code of Civil Procedure causes the
proceedings to lapse...............................................................................................................21
PRAYER ..........................................................................................................................................24

INDEX OF AUTHORITIES
CASES
1. Adhish Chandra v. Hindustan Gas and Industries Ltd, AIR 1985 Cal 154.
2. Ammonia Supplies Corpn. Pvt. Ltd. v. Modern Plastic Containers Pvt. Ltd., (1998) 7
SCC 105.
3. Aspi Jal and another v Khushroo Rustom Dadyburjor, AIR 2013 SC 1712.
4. Bachan Singh v. Dhian Das, (1973) 2 SCC 109.
5. Bajaj Auto Ltd. v. N.K. Firodia, (1971) 41 Comp Cas 1.
6. Bal Gangadhar Tilak v. Sahwarbau, 26 Bom 792.
7. Balabai v. Ganesh Shankar Pandit, (1904) ILR 27 Bom 105.
8. Bhagat Singh v. Piar Bus Service Ltd., [1960] 30 Comp Cas 300.
9. Bhura v. Kashi Ram, (1994) 2 SCC 111.
10. Bipin Behari v. Jogindra Chandra, AIR 1917 Cal 248.
11. Boiron v. SBL Pvt. Ltd., 1999 (48) DRJ 31.
12. C.I.T. v. Ogale Class Works Ltd., AIR 1954 SC 429.
13. Daddy S. Mazda v. Irani, (1977) 47 Comp Cas 39 (Cal).
14. Dale and Carrington Invt. (P) Ltd. v. P.K. Prathapan and Ors., (2004) 122 CompCas 161
(SC).
15. Damyanti Rai Bakshi v. Maharaj Kumar Mehta, AIR 2004 Delhi 422.
16. DH Tewary v. Dulhin Bihasa Kuer, AIR 1963 Pat 390.
17. Dr. V.L. Pahade v. Vinay L. Deshpande, 1999 SCC OnLine AP 187.

18. E.V. Swaminathan v. KMMA industries and Roadways P. Ltd., (1993) 76 Comp Cas 1
(Mad).
19. First National Bank Ltd. v. Shri Devi, AIR 1968 Punj 252.
20. Gour Chandra Das v. Sarat Sundari Dassi, ILR (1913) 40 Cal 50.
21. Gouri Shankar v. Hari Bhobini, 41 CWN.
22. Gulabrai Kalidas Naik v. Lakshmidas Patel, (1978) 48 Comp Cas 438 (Guj).
23. Gunindra v. Jagmala, ILR 30 Cal 581.
24. Gurcharan Singh v. Surjit Singh & Anr., I.A. No. 2 to 6, in Special Leave Petition (C) No.
7735 of 2010.
25. Gurmail Kaur v. Jaswant Kaur, (2007) 146 PLR 763.
26. Hansraj Gupta v. Dehra Dun-Mussoorie Electric Tramway Co. Ltd., AIR 1933 PC 63.
27. Hari Ram v. Lichmaniya, AIR 2004 Raj 319.
28. Harinagar Sugar Mills Ltd. v. Shyam Sunder Jhunjhunwala, (1961) 31 Comp Cas 387.
29. Harnam Singh v. Bhagwan Singh, (1992) 74 Comp Cas 726 (Del).
30. Indian Chemical Products Ltd. v. State of Orissa, (1966) 36 Com. Cases 592 (SC).
31. Jai Mahal Hotels Pvt. Ltd. v. Rajkumar Devraj & Ors., 2015 SCC OnLine SC 841.
32. Jatia Cotton Mills Ltd. v. Ram Prasad Bajoria, (1975) 45 Comp Cas 686 (Cal).
33. Jeaban v. Jitendra, AIR 1949 PC 64.
34. Jugdish v. Upendra, 48 CWN 294.
35. K. Muthusamy v. S. Balasubramaniam, 2011 (2) TMI 1279.
36. K.P. Antony v. Thandiyode Plantations P. Ltd, (1996) 86 Comp Cas 684 (Ker).
37. Kalyamal Mills Ltd v. Vali Mahommad, AIR 1965 MP 72.
5

38. Kamlabai v. Vithal Prasad Co. Pvt. Ltd., (1993) 77 Comp Cas 231 (Kar).
39. Kasi Viswanathan Chettiar v. Indo-Burma Petroleum Co. Ltd., (1936) 6 Comp Cas 42.
40. Kothari Industrial Corpn. Ltd. v. Lazor detergents Pvt. Ltd., 1994 Com. Law 617.
41. Kumar Abhayanand v. Maharajadhiraj Rameshwar, AIR 1930 Pat 395.
42. Kurappaswamy & Ors. v. C. Ramamurthy, AIR 1993 SC 2324.
43. Lalta Baksh Singh v. Phool Chand, AIR 1945 PC 113.
44. Laraite Devi v. Sitaram, AIR 1957 All 820.
45. Luxmi Tea Co. Ltd. v. P.K. Sarkar, (1990) 67 Comp Cas 518.
46. M.B. Ramesh v. K.M. Veeraje Urs, (2013) 7 SCC 490.
47. M/s Sumitomo Heavy Industries Ltd. v. Oil and Natural Gas Company, AIR 2010 SC
3400.
48. Maharaj Devraj v. Jai Mahal Hotels Pvt. Ltd., 2011 SCC OnLine CLB 116.
49. Mangat v. Surja, AIR 1979 Pat 194.
50. Meena Vasant Patel v. Prithviraj Ambalal Patel, 2010 (6) Mh LJ 539.
51. Mohinder Kaur v. Piara Singh, AIR 1981 P&H 130.
52. Muniyamma v. Arathi Cine Enterprises (P) Ltd., (1993) Com. L.J 327.
53. N. Kasturi v. D. Ponnammal, AIR 1961 SC 1302.
54. N.K.R.M. Rajagopala Chettiar v. Hindu Religious Endowment Board, Madras, AIR 1934
Mad103.
55. National Institute of M H & NS v. C Parameshwara, AIR 2005 SC 242.
56. National Insurance Company Limited v. Glaxo India Limited, 1999 Indlaw MUM 428.
57. Navneet Lal v. Gokul, AIR 1976 SC 794.
6

58. Nila Baurat Engg. Ltd v. Rajasthan Urban Infrastructure Project, AIR 2004 Guj 221.
59. Permanand v. Prescribed Authority (Munsif City), 2002 AIHC 15 (18).
60. Prankisto v. Nobodip, (1882) ILR 8 Cal 868.
61. Public Passenger Service Ltd. v. M.A Khadar, AIR 1966 SC 489.
62. Rajkumar Devraj & Ors. v. Jai Mahal Hotels Pvt. Ltd., (2013) 135 DRJ 213.
63. Ram Kala v. Deputy Director (Consolidation) & Ors., (1997) 7 SCC 498.
64. Re goods of Gagan Chandra, AIR 1950 Cal 578.
65. S.D. Dhandapani v. The Branch Manager, Indian Overseas Bank, AIR 2002 Mad 442.
66. Sakuntala Dasi v. Kusum Kumari Sarkar, AIR 1971 Ori 103.
67. Scientific Instruments Co Ltd. v. Rajendra Prasad Gupta, (1999) 34 CLA 36 (All).
68. Shanti v. Pankaj, AIR 1995 P&H 14.
69. Sheikh Rahmat Ilahi v. Mohammed Hayat Khan, AIR 1943 PC 208.
70. Sohal Engineering Works v. Rustam Jehangir Vakil Mills, AIR 1981 Guj 110.
71. Sree Meenakshi Mills Ltd. v. Commissioner of Income Tax, 1956 SCR 691.
72. State of Chhatisgarh v. Dhirajo Kumar Sengar, AIR 2009 SC 2568.
73. State of Orissa v. Indian Chemical Products Ltd., AIR 1957 Ori 203.
74. Sukumar Deb Roy v. Parbati Bala, AIR 1941 Cal 663.
75. Swagath Marine Products Pvt. Ltd. v. K. Muthuswamy, (2006) 134 Comp Cas 182
(CLB).
76. Thenappa Chettiar v. Indian Overseas Bank Ltd., (1943) 13 Comp Cas 202 (Mad).
77. V.B. Rangaraj v. V.B. Gopalakrishnan, (1992) 73 Comp Cas 201.

78. Vallabh Das v. Madan Lal, AIR 1970 SC 987.

79. Vardhman Publishers Ltd. v. Mathrubhumi Printing and Publishing Co Ltd., (1991) 71
CompCas 1 (Ker).

STATUTES
1. Code of Civil Procedure, 1908.
2. The Companies Act, 1956.
3. The Indian Succession Act, 1925.
BOOKS
1. A. RAMAIYA, GUIDE TO THE COMPANIES ACT (17th edn., 2011).
2. D.N. SEN, INDIAN SUCCESSION ACT, 1925 (5th edn., 2008).
3. FRANCIS BEAUFORT PALMER, PALMERS COMPANY LAW (Geoffrey Morse et al. eds., 25th
edn., 2014).
4. GOPALAKRISHNAN, LAW OF WILLS (7th edn., 2009).
5. MULLA, THE CODE OF CIVIL PROCEDURE ABRIDGED (15th edn., 2012).
6. P.L. PARUCK, THE INDIAN SUCCESSION ACT, 1925 (10th edn., 2011).
7. S.C. SARKAR, THE LAW OF CIVIL PROCEDURE (11th edn., 2006).

MISCELLANEOUS
1. BRYAN A. GARNER, BLACKS LAW DICTIONARY (10th edn., 2014).

STATEMENT OF JURISDICTION

CIVIL APPEAL NO. _____ / 2015

The Appellants have approached this Honourable Court under Article 136 of the Constitution of
India, 1950. Subsequently, the leave has been granted by the Court. The Respondents humbly
submit to the jurisdiction of this Honourable Court.

STATEMENT OF FACTS

The Betrothals
The Democratic Republic of Ebony is a fully democratic State with twenty different provinces.
One of the provinces of Republic was Scion headed by King Igusthus. He had three daughters,
the eldest being Princess Khloe, followed by Princess Kourtney and then Princess Kim. All three
sisters were married one after another to King Big Bilzerian, head of the royal family of the
province of Thelesalonica. Consequently, they had four children. From Queen Khloe were born
Prince Dumas and Princess Dumagoli. From Queen Kourtney were born Prince Drago and
Prince Drakshin. Marriage with Queen Kim resulted in the birth of Prince Ray. Prince Ray was
given up on adoption to King Dueta of the royal family of Thalai who was issueless himself.
Princess Dumagoli was married into the Royal Family of Dakshin and gave birth to Princess
Duma. Prince Ray married Princess Carlen of the Province of Malay, who gave birth to Prince
Wild Bilzerian and Princess North Bilzerian.
The Formation of the Company
After the demise of King Big Bilzerian, the management and administration of the estate of the
Royal Family of Thelesalonica came under the control of King Dumas, King Drago and King
Drakshin. In the year 1981, all the brothers decided to bring up a business by establishing a
Company to which their former residence would be leased and would be converted into a
Heritage Hotel wherein the general public would be allowed to visit the Royal Fort and stay as
their guest. Thus, the family property was leased to the Company which was named Royal
Retreat Group of Hotels Resorts and Palaces Pvt. Ltd..
In 1983, the brothers, on the request of Queen Kim, added another promoter by amending the
Articles of Association of the company. This new promoter was King Ray. The amended Articles
of Association stated that in the event of death or legal disability of a promoter, the shares of this
promoter director shall be transferred to the company in the interim and eventually transferred to
the legal representatives of such promoter director. In the year 1986, a Partition Suit was filed
amongst the family members of the Royal Family of Thelesalonica seeking a partition by metes
10

and bounds. During the course of the Suit, the validity of the adoption of Prince Ray and his right
of inheritance also came under dispute.
Will and Succession Disputes
Amidst all this, owing to serious differences arising between King Ray and Queen Carlen, the
marriage ended in an irretrievable breakdown. In the year 1997, King Ray succumbed to illhealth. After his death, Prince Wild Bilzerian and Princess North Bilzerian filed a case for
Succession before the District Court seeking one-third share in the estate of King Ray along with
Queen Kim. In the same year, King Dumas filed an Impleadment Application and objected to
the succession certificate.
In December 2005, Queen Kim found a Will dated June 23, 1996 wherein King Ray had stated
that upon his demise, since he did not want his former wife to grab the property, both his children
would be disinherited and all his property would go to his mother.
In the Month of May 2006, the company received a letter from Queen Kim requesting
transmission of all the shares standing in the name of late King Ray in her favour in view of the
Will dated June 23, 1996, and she further filed an Application for Probate before the District
Judge of Thelesalonica on the basis of the aforesaid Will. However, the Company decided that in
light of the dispute and the civil cases pending before the courts, any person requesting for the
transmission of shares would be required to produce the evidence by way of appropriate title
through a Probate, failing which the Company would not transfer the shares in dispute to any
individual. On May 8, 2009, the grandchildren of Queen Kim entered into a Settlement Deed
with her before the District Court with regards to the share in the property of King Ray, wherein
it was agreed that the assets would be divided equally in a one-third share amongst themselves.
They obtained a succession certificate for the same.
Queen Kim expired in late 2009. Upon her death, Prince Wild Bilzerian moved an Application
before all the Courts wherein a dispute was pending an Application for Substitution as her Legal
Heir along with his sister Princess North. Similar applications were filed by the rest of the
family.

11

Prince Wild and Princess North also claimed that Queen Kim vide her Will dated May 10, 2009
had bequeathed all her properties in favour of her two grandchildren and to no one else. Thus, on
the basis of the said Will a Probate Petition was filed before the District Court wherein all the
other members of the family raised objections, challenging the authenticity of the said Will.
In the interim, all the above parties wrote to the Company seeking transfer of the shares of the
late King Ray in their own name. The Company, pointing to the various disputes pending
between the parties herein again declined to transfer any shares unless conclusive proof or
evidence by way of a Probate from a Court of competent jurisdiction was brought before it.
Orders of the Court and Appeals thereof
The High Court of Thelesalonica gave an Interim Order that both the groups before the Court i.e.
her grandchildren as well as her step sons were her legal heirs. Aggrieved by the same both the
grandchildren filed a Review Petition.
The Company yet again refused to transfer the shares in favour of any party. As a result, the
parties, dividing themselves into two groups, one comprising of the step sons and the other
comprising of the grandchildren, moved Applications before the Company Law Board under
Section 111 of the Companies Act, 1956 praying for the transfer of shares in favour of the
respective Applicants. Subsequently, in the year 2011 a Civil Suit was filed against Prince Wild
and Princess North, being a Suit for Declaration and Permanent Injunction, praying for a
declaration that the alleged Will of the Late Queen Kim dated May 10, 2009 was forged and
fabricated.
The Company Law Board held that it cannot, while exercising summary jurisdiction, decide
complicated questions of fact and law which arise before it. The parties then approached the
Honble High Court wherein the Court held that succession certificate was prima facie proof of
title of the Prince and Princess and accordingly ordered for transfer of the assets and shares of
late King Ray in their favor.

12

The Honble High Court also interpreted the will of late King Ray to mean that the concern of
the testator was that his estranged wife should not grab his property through his children. The
court further held that there appeared to be no fraud or forgery of the will and thus a Petition
under Section 111 was very much maintainable.
Aggrieved by the above findings and Judgement and Order of the Honble High Court of
Thelesalonica, the aggrieved group filed Special Leave Petitions before the Honble Supreme
Court of Ebony where leave was granted.

13

ISSUES INVOLVED
I.
WHETHER THE HIGH COURT HAD RIGHTLY EXERCISED ITS JURISDICTION UNDER SECTION 10F
WHILE HEARING AN APPEAL AGAINST

SECTION 111 OF THE COMPANIES ACT?

II.
WHETHER THE HIGH COURT COULD HAVE HEARD AND DECIDED VARIOUS ASPECTS AND DISPUTES
PENDING ADJUDICATION IN THE COURTS BELOW WHICH WERE IN THE NATURE OF CIVIL DISPUTES?

III.
WHETHER THE HIGH COURT COULD HAVE INTERPRETED A WILL WHILE EXERCISING JURISDICTION
UNDER

SECTION 10F?
IV.

CAN A JOINT SUCCESSION CERTIFICATE BE RELIED UPON WHEREIN ONE OF THE MEMBERS TO THE
VERY SAME CERTIFICATE HAD EXPIRED?

V.
CAN PROBATE PROCEEDINGS BE TERMED AS LAPSED ON THE BASIS OF SETTLEMENT ENTERED
INTO BETWEEN SOME OF THE PARTIES?

14

SUMMARY OF ARGUMENTS

[I] The High Court has rightly exercised its jurisdiction under Section 10F while hearing an
appeal against Section 111.
As per Section 10F of the Companies Act, 1956, an appeal to the High Court lies on a question
of law arising out of the order of the Company Law Board. It is submitted that the denial of the
Company Law Board to maintain the petition, on the ground that there are complicated questions
involved, itself gives rise to a question of law. Furthermore, a question of law is said to arise out
of the order of the Company Law Board when it has failed to consider the material facts of the
presence of the will of King Ray, the succession certificate and the will of Queen Kim. In
addition, the Company Law Board has also failed to provide remedy against the arbitrary refusal
of the Company to register the transfer of shares which goes beyond its Articles of Association.
Therefore, the High Court has the jurisdiction to hear and decide the matter before it where the
Company Law Board has erred in exercising its jurisdiction.
[II] The High Court could have heard and decided various aspects and disputes pending
adjudication in the courts below which were in the nature of civil disputes.
Section 10 of the Code of Civil Procedure Code, 1908 says that a court shall not proceed with the
trial of a suit to which the Code applies when all of the following conditions are fulfilled: one,
there is a previously instituted suit which is still pending adjudication; two, the matter in issue in
the subsequent suit is directly and substantially the same as in the previously instituted suit;
three, both suits are either between the same parties or their privies; and four, the courts before
which suits have been filed are of competent jurisdiction.
It is argued in the present case that first, company proceedings are not suit as defined in the
Code of Civil Procedure because they are not instituted by the presentation of a plaint. Thus, bar
on trial of suit under Section 10 does not apply. Secondly, even if it is considered to be a suit
under the Code, still Section 10 is not applicable because all the elements of this provision, as
stated above, are not fulfilled. Although there are three suits between the same parties that too

15

before courts of competence, the subject matter of none of these suits is directly and substantially
the same as in the present suit.
[III] The High Court could have interpreted a will while exercising jurisdiction under
Section 10F.
It is submitted that the High Court had the jurisdiction to decide a will under an appeal under
Section 10F. It has been held by the courts that the interpretation of a legal document, in the
present case a Will, is a question of law. The Company Law Board refused to exercise
jurisdiction in pursuance of the presence of disputes regarding the title of the shares of King Ray
which were placed before it. The will of King Ray, being a part to the dispute, as well as the
basis of the right of Queen Kim to claim the shares, therefore, could be said to be raised before
the Company Law Board and dealt with by it. Therefore, it arises out of the order of the
Company Law Board. Hence, the High Court could have interpreted the will of King Ray.
Furthermore, Section 111(7) empowers the court to decide any disputes relating to title and
hence, the power conferred by the statute is wide and extensive in this regard. It is further
submitted that the interpretation of the High Court of the Will of King Ray was correct in law.
[IV] The succession certificate was operative, and could have been relied upon by the High
Court.
The event of death of Queen Kim cannot be said to have any effect upon the validity of the
succession certificate. First, there is no statutory provision which would invalidate the certificate
upon death of a joint-holder of a certificate. Section 381 makes the succession certificate valid
and conclusive only subject to the provisions of Part X. But none of the provisions which defeat
the validity of the certificate are attracted in the situation of death of a joint certificate-holder.
Further, the Act has express provisions providing for continuance in validity of a probate and a
letter of administration after the death of a joint-holder. A corresponding provision must be said
to be implied with respect to a grant of succession certificate. Secondly, it is admitted that an
alternate view was taken by the Court in Sukumar Deb Roy v. Parbati Bala. However, the
reasoning employed in the case is erroneous in law as well as in policy. In any case, the facts of
that case were wholly distinct and are inapplicable to the instant case. Thus, it cannot be relied
upon and the certificate continues to be operative.
16

[V] By virtue of the Settlement Deed, the probate proceedings instituted by Queen Kim
stand lapsed.
The probate proceedings stand lapsed by virtue of the settlement deed on two accounts. First,
Queen Kim no longer pressed her claim under the probate. She was the sole dominus litis in the
petition, thus, the matter and the choice to not assert her right under the will must be left to her
charge. Her choice to not assert such a claim is apparent from the fact that she settled the
ongoing disputes with her grandchildren by way of the Settlement Deed and further bequeathed
all her properties in their favour. There is no method prescribed under law to compel a person to
pursue proceedings which he or she chooses to discontinue. Further, the proceedings will lapse in
default of appearance under Order IX, Rule 3 of the Code of Civil Procedure. Secondly, Order
XXIII, Rule 3 of the Code of Civil Procedure recognizes the compromise of pending proceedings
by an agreement. The Settlement deed, in the instant case, is lawful and would draw the probate
proceedings to a close. Even if the Rule 3 is assumed to be inapplicable, the abandonment of
claim by Queen Kim without the leave of the court under Order XXIII, Rule 1 results in a lapse
of the proceedings.

17

BODY OF ARGUMENTS

[I] THE HIGH COURT HAS RIGHTLY EXERCISED ITS JURISDICTION UNDER SECTION 10F
WHILE HEARING AN APPEAL AGAINST SECTION 111.

1. It is submitted that in the present case, the High Court had decided the Company Appeal within
the bounds of its jurisdiction under Section 10F as: The jurisdiction of the High Court arises as
there is a question of law which arises out of the order of the Company Law Board [A.]; The
refusal of the Company to transfer the shares is arbitrary [B.]; The High Court had jurisdiction to
hear and decide the appeal as it did [C.].
[A.] The High Court had jurisdiction as there is a question of law.
2. An appeal to the High Court under Section 10F lies only on a question of law that arises out of
the order of the Company Law Board.1 It is submitted the there was a question of law that arose
out of the order given by the Company Law Board as: [i] first, the issue of non-maintainability of
petition is a question of law arising out of the order; and [ii] secondly, the failure of the Company
Law Board to consider material facts is a question of law arising out of the order.
[i] The issue of non-maintainability of petition is a question of law arising out of the order.
3. Section 111 of the Companies Act, 1956 provides discretionary powers to the Company Law
Board.2 The Board, on examination of the facts may refuse to adjudicate upon certain matters.
However, the powers of the Board under this section are wide and extensive, even though the
jurisdiction conferred is summary.3 Hence, the Company Law Board can adjudicate on
1 The Companies Act, No. 1 of 1956, 10F (1956) (Appeals against the orders of the Company Law Board -Any
person aggrieved by any decision or order of the Company Law Board [made before the commencement of the
Companies (Second Amendment) Act, 2002] may file an appeal to the High Court within sixty days from the date of
communication of the decision or order of the Company Law Board to him on any question of law arising out of
such order: Provided that the High Court may, if it is satisfied that the appellant was prevented by sufficient cause
from filing the appeal within the said period, allow it to be filed within a further period not exceeding sixty days.).

2 Dr. V.L. Pahade v. Vinay L. Deshpande, 1999 SCC OnLine AP 187; S. Bhagat Singh v. Piar Bus Service
Ltd., [1960] 30 Comp Cas 300; Ammonia Supplies Corpn. Pvt. Ltd. v. Modern Plastic Containers Pvt.
Ltd., (1998) 7 SCC 105.
1

complicated questions itself. It need not relegate the suit to a civil court whenever any
complicated questions appear to be present.
4. Furthermore, in the event Company Law Board chooses to exercise discretion to refuse relief,
such discretion to refuse relief by denying exercise of powers under the aforesaid section cannot
be exercised by the Board arbitrarily.4 In the present case, the Board has passed the order
refusing to grant relief on the ground that it does not have jurisdiction since there are disputed
questions of title involved.5 However, it has been held on various occasions that the Company
Law Board cannot refuse to exercise jurisdiction merely by stating that the matter involves
complicated questions of law and fact.6 The Board has to examine whether the complicated
questions are in fact present, or only prima facie appear to be.7 The mere presence of a dispute
regarding title would not, in every situation, mean that the Company Law Board will not have
jurisdiction to deal with it. If that would be considered as the position then it leaves a chance for
the jurisdiction of the Board to be ousted by presenting trivial matters as involving complex
questions.8
5. In the instant situation, the disputes regarding the title of shares of King Ray have been held by
the Company Law Board to be complicated questions, and on the same grounds, the Board has
decided to not rule on the merits of the case. 9 This gives rise to the issue whether the scope of the

3 Daddy S. Mazda v. Irani, (1977) 47 Comp Cas 39 (Cal); Gulabrai Kalidas Naik v. Lakshmidas Patel,
(1978) 48 Comp Cas 438 (Guj); E.V. Swaminathan v. KMMA industries and Roadways P. Ltd., (1993) 76
Comp Cas 1 (Mad).
4 Public Passenger Service Ltd. v. M.A Khadar, AIR 1966 SC 489; Indian Chemical Products Ltd. v.
State of Orissa, (1966) 36 Com. Cases 592 (SC).
5 Factsheet 24.
6 Muniyamma v. Arathi Cine Enterprises (P) Ltd., (1993) Com. L.J 327 at 345. See also
E.V Swaminathan v. K.M.M.A. Industries & Roadways (P) Ltd., (1993) 1 Com. L.J 291 (Mad.); Kothari
Industrial Corpn. Ltd. v. Lazor detergents Pvt. Ltd., 1994 Com. Law 617.
7 Ammonia Supplies Corpn. Pvt. Ltd. v. Modern Plastic Containers Pvt. Ltd., (1998) 7 SCC 105; Boiron
v. SBL Pvt. Ltd., 1999 (48) DRJ 31.
8 Kothari Industrial Corpn. Ltd. v. Lazor Detergents Pvt. Ltd., 1994 Com. Law 617.
9 Factsheet 24.
2

jurisdiction was rightly exercised by the Board. Therefore, the exercise of discretion while
deciding the maintainability itself becomes a question of law.10

[ii] The failure of the Company Law Board to consider material facts is a question of law arising
out of the order.
6. A question of law arises when the Company Law Board has passed an order without correctly
appreciating the facts that are present.11 In such cases, the question of fact itself becomes a
question of law.12 When a dispute can be resolved by assessing documentary proof presented
before it, and there is no prima facie necessity for a detailed investigation into the matter, the
Company Law Board has jurisdiction to adjudicate on the matter. In the event the Board has
overlooked certain material facts, or has passed an order without keeping the same into
consideration, and assuming that there are complicated questions present, the finding of fact is
appealable before the High Court as a question of law.13
7. In the present case, the Board has not considered the prima facie title in the favour of the
grandchildren by way of succession certificate, obtained in accordance with the settlement
deed.14 It has also not taken into account the will of Queen Kim in favour of the grandchildren. 15
The will has not yet been disproved. In such a case, the Board had documentary proof to grant
remedy. In any case, where the High Court, through an Interim Order dated September 1, 2010,
has declared the both the grandchildren as well as the step-sons to be the legal heirs of Queen
Kim, the grandchildren will, in any event, be entitled to a part of her share. In this scenario, when
the registration was sought from the Company, the order itself is sufficient for the Company to
register the shares. No further protection need be insisted upon. 16 With the Interim Order of the
Court, over and above the documentary proof provided, the Company Law Board has erred in
10 K. Muthusamy v. S. Balasubramaniam, 2011 (2) TMI 1279.
11 Scientific Instruments Co. Ltd. v. Rajendra Prasad Gupta, (1999) 34 CLA 36 (All).
12 Sheikh Rahmat Ilahi v. Mohammed Hayat Khan, AIR 1943 PC 208.
13 Bachan Singh v. Dhian Das, (1973) 2 SCC 109; Scientific Instruments Co. Ltd. v. Rajendra Prasad
Gupta, (1999) 34 CLA 36 (All).
14 Factsheet 18.
15 Factsheet 20.
3

holding that there were complicated questions present only because of the presence of
multiplicity of the suits, and has not examined the real facts of the situation.
8. Therefore, there was a question of law arising out of the order of the Company Law Board which
said that it lacked jurisdiction to deal with the petition.17 The High Court, thus, had jurisdiction to
hear the appeal.
[B.] The Refusal of the Company to transfer the shares is arbitrary.
9. It is submitted that the Company has refused the transfer of shares in the favour of Prince Wild
and Princess North Bilzerian without reasonable justification for the same as: [i] The power to
refuse is not present in the Articles of Association; [ii] Even if it is present, has been exercised
arbitrarily and in violation of the Articles of Association.
[i] The power to refuse is not present in the Articles of Association.
10. A private company has power to restrict the transfer of shares in accordance with its Articles of
Association.18 In cases where the Articles of Association of the company confer powers on the
directors to refuse registration of the shares, the court has held that such a power should be
exercised reasonably.19 However, the directors have no inherent power to refuse the transfer of
shares or the registration thereof.20 Such a power has to flow from a source and is exercisable
only when it is either specified or traceable in the Articles of Association of the Company.21
11. In the present case, Clause 11, which deals with the transfer of shares of a promoter director in
case of death or resignation, does not provide for any powers to the directors to refuse the
transfer of shares.22 Hence, the Company has exceeded the scope of the powers given to it under
the Articles while refusing the transfer of the shares to the applicants. Therefore, a petition under
16 Jatia Cotton Mills Ltd. v. Ram Prasad Bajoria, (1975) 45 Comp Cas 686 (Cal); A. RAMAIYA, GUIDE
TO THE COMPANIES ACT, 1482 (17th edn., 2011).
17 K. Muthusamy v. S. Balasubramaniam, 2011 (2) TMI 1279.
18 V.B. Rangaraj v. V.B. Gopalakrishnan, (1992) 73 Comp Cas 201.
19 Bajaj Auto Ltd. v. N.K. Firodia, (1971) 41 Comp Cas 1.
20 RAMAIYA, supra note 16, at 1581.
21 Luxmi Tea Co. Ltd. v. P.K. Sarkar, (1990) 67 Comp Cas 518; V.B. Rangaraj v. V. B. Gopalakrishnan,
(1992) 73 Comp Cas 201.
22 Factsheet 12.
4

Section 111 is rightly maintainable where clearly, on the face of it, the Company has declined
registration without any power in the regard.23
[ii] Even if it is present, it has been exercised arbitrarily and in violation of the Articles of
Association.
12. Even if it is assumed that the Company did have the power to refuse the transfer, the power has
been exercised by it arbitrarily and in violation of the Articles of Association as: a. The Articles
of Association only require the shares to be transferred to the legal representatives as against
legal heirs; b. The Company was not justified in insisting on a Probate when succession
certificate has been obtained.
a. The Articles of Association only require the shares to be transferred to the legal representatives.
13. A legal representative to a person is distinct from his/her legal heirs, though the people falling in
the two categories might overlap.24 Though an heir can be a legal representative, it is not
necessary that a legal representative of a person must be an heir to him.
14. In the present situation, Clause 11 of the Articles of Association of the Company states that in the
event of death of any promoter director, his shares shall be transferred to the estate or legal
representatives of the deceased.25 Hence, the limitation that is provided for in the Articles of
Association is that the Company shall transfer the shares to the legal representatives of the
deceased director, who in the present case is King Ray. This clause is also in accordance with the
Companies Act.26 However, despite this limitation, on the request of transfer of shares, the
Company has maintained the demand for a conclusive proof establishing the legal heirs of King
Ray.27 This limitation put forward by the Company is in violation of the aforementioned clause in
the Articles of Association of the Company. Therefore, the Company cannot seek to refuse the
transfer of shares on the death of King Ray by way of reason that the parties are not his legal
heirs as such a reason cannot be traced to the Articles of the Company.
23 RAMAIYA, supra note 16, at 1581.
24 Balabai v. Ganesh Shankar Pandit, (1904) ILR 27 Bom 105.
25 Factsheet 12.
26 Companies Act, No. 1 of 1956, Article 25, Table A, Schedule I (1956).
27 Factsheet 21.
5

15. The Company was not justified in insisting on a probate when succession certificate had been
obtained.
16. Admittedly, there are circumstances where it is reasonable for a company to demand conclusive
proof from the person seeking the registration of the transfer by way of a Probate/Succession
Certificate/Letters of Administration.28 However, the cases where the insistence on Probate has
been upheld refer to the facts where there has been serious challenge to the will. However, in the
present case, the will of King Ray was never been brought under any challenge and Queens
succession to his estate was not under dispute. Therefore, the Company does not have the right to
demand Probate on the grounds that there were disputes involved. 29 Moreover, the children of
King Ray have obtained a succession certificate in their favour.30 In the present case where there
has been a grant of succession certificate and the same is presented by the children to the
Company, the Company cannot insist on the production of the probate. 31 The succession
certificate itself affords full protection to the Company and the same must be accepted.32
17. Furthermore, the step-sons do not have any locus standi to claim the shares of King Ray on the
ground that Queen Kim died intestate and therefore, the property bequeathed by King Ray to
Queen Kim would devolve on to her step-sons, being her legal heirs. This contention does not
hold ground as the shares of King Ray were never transferred to Queen Kim before and death
and were not registered by the Company in her name. It is a settled principle of English
Company Law that when a person wills away their shares to another and such another dies
intestate with neither the shares been transferred in his/her name, nor the registration been
recorded before the death, the shares would not devolve on to the heirs of such person, but would
be traced to the representatives of the original shareholder.33 The principles of English Company
Law have been imported in the Indian jurisprudence on several occasions to determine the
28 Kasi Viswanathan Chettiar v. Indo-Burma Petroleum Co. Ltd., (1936) 6 Comp Cas 42.
29 Factsheet 17.
30 Factsheet 18.
31 Thenappa Chettiar v. Indian Overseas Bank Ltd., (1943) 13 Comp Cas 202 (Mad).
32 Kamlabai v. Vithal Prasad Co. Pvt. Ltd., (1993) 77 Comp Cas 231 (Kar).
33 FRANCIS BEAUFORT PALMER, PALMERS COMPANY LAW, 6090 (Geoffrey Morse et al. eds., 25th edn.,
2014).
6

principles to be followed.34 Therefore, with application of the above-mentioned principle in the

present case, since the shares were never transferred to Queen Kim, the step-sons, even as her
heirs cannot claim it to be transferred in their name after her intestate death as has been
contended by them.
18. Additionally, if the decision undertaken in the Annual General Meeting is understood to be an
alteration to the Articles of Association, such an alteration cannot be given effect
retrospectively.35 Since, the request for the shares was made by Queen Kim and the Will which
was the basis of the request had been presented, the Company cannot subsequently alter the
Articles and seek to enforce it by demanding probate for an application made to the Company
prior to such meeting.
19. Therefore, the refusal of the Company to transfer the shares was not based on justified reasons.
Furthermore, it was in violation of the Articles of Association as well as the Companies Act.
Therefore, the Company Law Board had the jurisdiction to decide the issues and ought to have
exercised the same and directed the Company to transfer the shares on the basis of the succession
certificate.
[C.] The High Court had jurisdiction to hear and decide the appeal as it did.
20. As submitted above, the High Court had jurisdiction to hear the appeal arising out of the order of
the Company Law Board as there was a question of law. This jurisdiction has been rightly
exercised. The power of the High Court under Section 10F is limited to hearing the appeal when
any question of law arises out of the order of Company Law Board. However, no limitation is
cast upon the High Court to restrict itself to only those aspects of the questions on which the
appeal was admitted.36
21. Therefore, where the Company Law Board has failed to exercise its jurisdiction, the High Court
has the power to set aside the order. Furthermore, the Board has failed to consider the real issues
that surround the case and are germane for the decision regarding the title of the shares. 37 In such
34 Vardhman Publishers Ltd. v. Mathrubhumi Printing and Publishing Co Ltd., (1991) 71 CompCas 1
(Ker).
35 Luxmi Tea Co. Ltd. v. P.K. Sarkar, (1990) 67 Comp Cas 518.
36 C.I.T. v. Ogale Class Works Ltd., AIR 1954 SC 429; Boiron v. SBL Private Ltd, 1999 (48) DRJ 31.
7

a case, the High Court can rightly venture into the depth of the matter and rule on the issues and
facts not considered by the Board.38
22. Additionally, the Company Law Board has failed to identify the arbitrariness of the Company
and has refused the remedy that ought to be available to the children. In such a case, the High
Court has correctly decided the matter and granted the remedy.
23. If it finds that no complicated questions are involved, the High Court can, in exercise of its
jurisdiction, appreciate the evidence that the Board failed to take note of and grant relief
accordingly.39 It is not necessary for the court to relegate the matter to the Board for reexamination in every case.40 Such an action depends on the facts and circumstances of the case.
Where the court finds that the facts are prima facie in favour of one of the parties, the High Court
may grant the remedy, setting aside the order of the Company Law Board. 41 In the instant case,
when there are documentary evidences that have been presented, keeping in mind the interest of
justice, it is within the power of the High Court to grant relief. 42

[II] THE HIGH COURT COULD HAVE DECIDED VARIOUS ASPECTS OF THE PRESENT DISPUTE AS
10 OF CODE OF CIVIL PROCEDURE DOES NOT APPLY.
24. It is submitted that High Court could have heard and decided various aspects and disputes
pending adjudication in the courts below as: Section 10 of the Code of Civil Procedure, 1908 is
not applicable mainly because Company proceedings are not suit for the purpose of Section 10
[A.]. Alternatively, even if Company proceedings are, in fact, considered to be suit under
Section 10, all the elements43 of Section 10 are not fulfilled [B.].
37 Dale and Carrington Invt. (P) Ltd. v. P.K. Prathapan and Ors., (2004) 122 CompCas 161 (SC).
38 Dale and Carrington Invt. (P) Ltd. v. P.K. Prathapan and Ors., (2004) 122 CompCas 161 (SC).
39 Indian Chemical Products Ltd. v. State of Orissa, (1966) 36 Comp Cas 592.
40 Rajkumar Devraj & Ors. v. Jai Mahal Hotels Pvt. Ltd., (2013) 135 DRJ 213.
41 Dale and Carrington Invt. (P) Ltd. v. P.K. Prathapan and Ors., [2005] 1 SCC 217.
42 Jai Mahal Hotels Pvt. Ltd. v. Rajkumar Devraj & Ors., 2015 SCC OnLine SC 841.
43 Swagath Marine Products Pvt. Ltd. v. K. Muthuswamy, (2006) 134 Comp Cas 182 (CLB).
8

[A.] Company Proceedings are not suit under 10 of Code of Civil Procedure.
25. Company proceedings are not suit as mentioned in Section 10. 44 Order 4, Rule 1 of the Code of
Civil Procedure defines a suit as a civil proceeding instituted by the presentation of a plaint. 45
There is no plaint presented in Company proceedings. Thus, such proceedings cannot be said to
be suit for the purposes of Civil Procedure Code, 1908. This view has been upheld by various
High Courts from time to time.46
26. Section 10 acts as a bar on trial of suit 47 and not otherwise48 when the matter in issue is directly
and substantially the same in the pending as well as subsequent suits. Thus, a company
proceeding cannot be stayed under Section 10 for the sole reason of it not being a suit. Hence,
the High Court was right in not staying an appeal arising out of company proceedings.
[B.] Alternatively, if Company proceedings are considered to be a suit, even then all the
elements of 10 are not fulfilled.
27. Even if company proceedings are considered to be suit, still the High Court was not bound to
stay such proceedings under Section 10 because all the elements of Section 10 are not fulfilled
as: (i) first, only three of the previously instituted suits are pending adjudication; (ii) secondly,
matter in issue in these three suits is not directly and substantially the same as that in the present
suit.

44 S.D. Dhandapani v. The Branch Manager, Indian Overseas Bank, AIR 2002 Mad 442; N.K.R.M.
Rajagopala Chettiar v. Hindu Religious Endowment Board, Madras, AIR 1934 Mad 103; Hansraj Gupta v.
Dehra Dun-Mussoorie Electric Tramway Co. Ltd., AIR 1933 PC 63.
45 Code of Civil Procedure, Act No. 5 of 1908, Order 4, Rule 1 (1908).
46 Punjab National Bank v. Gajendra Singh, 2001 (1) Civ LR 431 (Raj); Jaipur Vastra Vyopar Sangh Ltd.
v. Shyam Sunder Lal Patodia, AIR 1970 Raj 91; Ladu Lal Jain v. Manager, Bank of Baroda, 1997 DNJ
Raj 260.
47 Code of Civil Procedure, Act No. 5 of 1908, 10 (1908).
48 See MULLA, THE CODE OF CIVIL PROCEDURE ABRIDGED, 65 (15 th edn., 2012).
9

[i] Only three of the previously instituted suits are still pending adjudication.
28. First, the Succession Case No. 413 of 199849 can be said to have been concluded on the issuance
of the Succession Certificate by the District Court of Thelesalonica to Princess North Bilzerian,
Prince Wild Bilzerian and Queen Kim.50
29. Secondly, the probate proceedings for King Rays Will stand lapsed due to the grant of
succession certificate. This is because Queen Kim, being the sole dominus litis chose not to press
her claim under the said probate proceeding and instead chose to enter into a Settlement Deed
with Prince Wild Bilzerian and Princess North Bilzerian and subsequently bequeathed all her
property to them. Moreover, the moment Order IX Rule 3 of Code of Civil Procedure is applied,
the proceedings stand lapsed.51
30. Thirdly, Applications for Substitution as Legal Heirs of Queen Kim were filed in all those courts
wherein a dispute was pending adjudication.52 At the time these applications were filed, the
pending suits included the Succession Case No. 413 of 1998, 53 Probate Petition for King Rays
Will54 and the Partition suit of 198655. Thus, the courts before which these Applications were
filed include the District Court of Thelesalonica and the High Court. Order 22, Rule 5 of the
Code of Civil Procedure, 190856 empowers the Court to decide questions as to who the legal
representatives of a deceased plaintiff or a deceased defendant are. 57 The objective of this
provision is the sustenance of suits to which the deceased was a party. Therefore, these
49 Factsheet 15.
50 Factsheet 18.
51 Code of Civil Procedure, Act No. 5 of 1908, Order IX Rule 3 (1908).
52 Factsheet 19.
53 Factsheet 15.
54 Factsheet 17.
55 Factsheet 13. See also factsheet 19, 20 (Probate petition for Queen Kims Will was filed after the
Applications for Substitution for Legal Heirs was filed).
56 Code of Civil Procedure, Act No. 5 of 1908, Order 22, Rule 5 (1908) (Where a question arises as to
whether any person is or is not the legal representative of a deceased plaintiff or a deceased defendant,
such question shall be determined by the Court: Provided that where such question arises before an
Appellate Court, that Court may, before determining the question, direct any subordinate Court to try the
question and to return the records together with evidence, if any, recorded at such trial, its findings and
reasons therefor, and the Appellate Court may take the same into consideration in determining the
question.)
10

applications also lapse when the corresponding proceedings come to an end. As argued above,
the Succession case and the Probate proceedings have already come to an end. What remains
now is the Partition suit. Thus, Application for Substitution as Legal Heirs now exists
corresponding only to the Partition Suit of 1986.
31. Fourthly, the probate proceedings for Queen Kims Will are still considered to be pending.58
32. Fifthly, in addition to this, the High Court passed an Interim Order dated September 1, 2010
declaring both the grandchildren and the stepsons of Queen Kim as her legal heirs. 59 Review
against the Interim Order is currently pending adjudication.60
33. Therefore, there are only three previously instituted civil suits pending as of now, viz., the
Review Petition against the Interim Order of the High Court, Probate Petition for Queen Kims
Will and the Partition Suit61 in the High Court of Thelesalonica with a corresponding Application
for Substitution as Legal Heirs.

[ii] The matter in issue in these three suits is not directly and substantially the same as that in the
present suit.
34. It is submitted that the matter in issue62 (subject matter) of the pending suits and the current
suit is directly and substantially63 the same. Subject matter refers to a bundle of facts64 that
are required to be proved to entitle the plaintiff to the relief claimed by him 65. The issue in the
current suit revolves around the dispute between the parties regarding transfer of shares of King
Ray. For these shares to be transferred, the parties are required to show the existence of a proof
57 Code of Civil Procedure, Act No. 5 of 1908, Order XXII, Rule 5 (1908); Gurcharan Singh v. Surjit
Singh & Anr., I.A. No. 2 to 6, in Special Leave Petition (C) No. 7735 of 2010; Kurappaswamy & Ors. v.
C. Ramamurthy, AIR 1993 SC 2324; Ram Kala v. Deputy Director (Consolidation) & Ors., (1997) 7 SCC
498.
58 Factsheet 20.
59 Factsheet 22.
60 Factsheet 22.
61 Emphasis supplied on the Application for Substitution as Legal Heirs.
62 Code of Civil Procedure, Act No. 5 of 1908, 10 (1908).
63 Code of Civil Procedure, Act No. 5 of 1908, 10 (1908).
64 Vallabh Das v. Madan Lal, AIR 1970 SC 987.
65 Vallabh Das v. Madan Lal, AIR 1970 SC 987.
11

entitling them to such transfer.66 A probate67 or a succession certificate68 can be considered to be

sufficient proof for such transfer. Therefore, proof of entitlement to shares and consequently,
succession certificate obtained by Princess North Bilzerian and Prince Wild Bilzerian along with
Queen Kim, can be said to be the subject-matter in this case because they help establish proof of
entitlement to get the shares transferred. In other words, it is imperative as per the Articles of
Association of the Company to prove who the legal representatives of King Ray are.69
35. None of the pending suits deal with the same subject matter as given in the current suit. First, a
Review petition is pending adjudication before the High Court against its Interim Order dated
September 1, 2010 wherein it was declared that both groups, i.e. grandchildren on one side and
stepsons on the other, are legal heirs of Queen Kim. 70 Thus, the subject matter can be said to be
limited to answering the question of who the legal heirs of Queen Kim are. It does not talk about
determination of the heirs of King Ray (or even legal representatives for that matter) which is
instrumental for determining in whose name the shares should be transferred. For the matter in
issue to be directly and substantially the same, it is necessary that the entire subject matter should
be the same71 and not just any of the questions in issue72.
36. Secondly, the probate petition for Queen Kims Will also does not deal with who the legal heirs
or legal representatives of King Ray are. The scope of the probate is limited to the determination
of the authenticity of the Will and no more. 73 At most if probate is granted, it will only result in
the determination of Queen Kims heirs and not that of King Ray. This may be incidentally and
collaterally74 related to current suit but entire subject of both the suits is not the same. Thus,
matter in issue is not directly and substantially the same in these two suits.
66 Factsheet 17, 21.
67 See factsheet 17 (Company itself asks for a Probate in its Annual General Meeting).
68 See generally Thenappa Chettiar v. Indian Overseas Bank Ltd.; (1943) 13 Com Cases 202 (Mad).
69 Factsheet 12.
70 Factsheet 22.
71 Adhish Chandra v. Hindustan Gas and Industries Ltd, AIR 1985 Cal 154.
72 Bipin Behari v. Jogindra Chandra, AIR 1917 Cal 248.
73 P.L. PARUCK, THE INDIAN SUCCESSION ACT, 1925, 1230 (10th edn., 2011).
74 Sohal Engineering Works v. Rustam Jehangir Vakil Mills; AIR 1981 Guj 110; National Institute of
MH & NS v. C Parameshwara, AIR 2005 SC 242.
12

37. Thirdly, the Partition suit of 1986 deals with the partition of the property of Bilzerian family by
metes and bounds and also questions the adoption of King Ray.75 Thus, this subject matter is
entirely different from the subject matter in the current suit. As far as the Application for
Substitution as Legal Heirs in the High Court 76 is concerned, such a claim is decided under Order
22 Rule 5 of the Code of Civil Procedure, 1908 as stated above. It empowers the Court to
determine who the legal representatives of a deceased in a pending suit are. 77 It does not confer
heirship.78 The main aim is to sustain the already instituted suit and not to decide questions of
heirship.79
38. Additionally, an important test to determine the applicability of Section 10 is the test of res
judicata according to which if the decision in the previous suit would act as res judicata80 on the
subsequent suit, then the latter is bound to be stayed. 81 The matter in controversy 82 should be
the same in both suits and not the relief claimed.83 Complete identity of prayers is not essential.
The subject matter should be directly and substantially the same to the extent of affecting the
decision in the subsequent case.84 But a decision under Order XXII Rule 5 does not operate as
res judicata.85 Such an order is made only for the purpose of sustenance of a suit and its
operation is confined to the proceedings of that particular case only.86 Thus, on the basis of the

75 Factsheet 13.
76 Factsheet 13, 19 (Application corresponding to the Partition suit of 1986).
77 Code of Civil Procedure, Act No. 5 of 1908, Order XXII, Rule 5 (1908).
78 DH Tewary v. Dulhin Bihasa Kuer, AIR 1963 Pat 390; Mangat v. Surja, AIR 1979 Pat 194.
79 Kalyamal Mills Ltd v. Vali Mahommad, AIR 1965 MP 72.
80 See generally BRYAN A. GARNER, BLACKS LAW DICTIONARY, 1470 (10 th edn., 2014) (Rule that final
judgment or decree on merits by court of competent jurisdiction is conclusive of rights of parties or their
privies in all later suits on points and matters determined in former suit).
81 National Institute of M H & NS v. C Parameshwara, AIR 2005 SC 242.
82 Aspi Jal and another v Khushroo Rustom Dadyburjor, AIR 2013 SC 1712.
83 Swagath Marine Products Pvt. Ltd. v. K. Muthuswamy, (2006) 134 Comp Cas 182 (CLB).
84 Swagath Marine Products Pvt. Ltd. v. K. Muthuswamy, (2006) 134 Comp Cas 182 (CLB).
85 Mohinder Kaur v. Piara Singh, AIR 1981 P&H 130.
86 DH Tewary v. Dulhin Bihasa Kuer, AIR 1963 Pat 390; Mangat v. Surja, AIR 1979 Pat 194.
13

above comparison, it is submitted that the subject-matter of the present suit is not the same as the
subject-matter of the Application for Substitution as Legal Heirs filed before the High Court.
39. Hence, none of the previously pending suits have the same subject matter as in the present case.
Therefore, Section 10 of Code of Civil Procedure does not apply and the High Court was right in
continuing with the trial of this case.

14

[III] THE HIGH COURT COULD HAVE INTERPRETED A WILL WHILE EXERCISING
JURISDICTION UNDER

SECTION 10F.

40. Section 10F allows an appeal to the High Court on any question of law that arises out of the
order of Company Law Board. The High Court, while hearing an appeal under Section 10F could
have interpreted the will of King Ray as: The interpretation of a will is a question of law and not
of fact [A.]; It arises out of the order of the Company Law Board [B.]. Additionally, Section 111
gives the court jurisdiction to decide any disputes relating to title [C].
[A.] The interpretation of will is a question of law.
41. It has been held by the Court in several cases that where a document of title, in the present case,
a will, is the foundation of the rights of the parties, the construction of such a document and its
interpretation is a question of law.87
42. A question of law is to be decided as per the facts and circumstances of the case. 88 In the instant
case, the shares in question belonged to King Ray.89 These shares have been bequeathed by a will
to Queen Kim.90 This will of King Ray has never been challenged. Moreover, a succession
certificate has been obtained by the children of King Ray along with Queen Kim on the basis of a
settlement deed entered into by them.91 Thus, on the basis of this, the title of the shares prima
facie rests with the children of King Ray. In such a scenario, where the only bar to the title has
been put by the statement in the will disinheriting the children, the intent of the testator needs to
be garnered by reading the will as a whole. Therefore, in such a case, since the interpretation of
the will has a bearing on the rights of the parties, it can be classified as a question of law, keeping
in consideration the facts and circumstances of the case.

87 M.B. Ramesh v. K.M. Veeraje Urs, (2013) 7 SCC 490; Gurmail Kaur v. Jaswant Kaur, (2007) 146
PLR 763.
88 Ammonia Supplies Corpn. Pvt. Ltd. v. Modern Plastic Containers Pvt. Ltd., (1998) 7 SCC 105;
National Insurance Company Limited v. Glaxo India Limited, 1999 Indlaw MUM 428.
89 Factsheet 17.
90 Factsheet 16.
91 Factsheet 18.
15

[B.] It arises out of the order of Company Law Board.

43. For the High Court to hear an appeal, the question of law must arise out of the order of the
Board.92 As submitted above, where the High Court finds that the Company Law Board has
failed to take into consideration the evidence that was available before it and has passed an order,
the High Court has the power to deal with the matter in depth. 93 This is so because the perversity
itself becomes a question of law.94
44. Therefore, in the instant case where the Company Law Board had decided that the matter
involved complicated questions of law and fact due to the pending disputes regarding title, and
the High Court, on appeal, found that there are no such questions as to the dispute due to the
presence of documentary evidence, the High Court has the power to interpret those documents
and establish the absence of any dispute.95 In doing so, it cannot be said that the need for
interpretation is not a question of law arising out of the order of the Company Law Board.
[C.] Furthermore, Section 111 empowers the court to decide any dispute relating to title.
45. The Clause (7) of Section 111 confers powers on the court to decide any dispute relating to the
title of the shares.96 There is no limitation placed on the powers of the court in the statutory
provision, except that the person on whose title the decision is being rendered must be a party to
the application made under this section. The aforementioned clause enables the parties in dispute
to advance documentary evidence and to make representations with respect to establishing their
title.97

92 Companies Act, No. 1 of 1956, 10F (1956).

93 Dale and Carrington Invt. (P) Ltd. v. P.K. Prathapan and Ors., [2005] 1 SCC 217.
94 Sree Meenakshi Mills Ltd. v. Commissioner of Income Tax, 1956 SCR 691; Boiron v. SBL Private
Ltd, 1999 (48) DRJ 31; M/s Sumitomo Heavy Industries Ltd. v. Oil and Natural Gas Company, AIR 2010
SC 3400.
95 Jai Mahal Hotels Pvt. Ltd. v. Rajkumar Devraj & Ors., 2015 SCC OnLine SC 841.
96 Companies Act, No. 1 of 1956, 111(7) (1956) (On any application under this section, the Tribunal (a) may decide any question relating to the title of any person who is a party to the application to have his
name entered in, or omitted from, the register; (b) generally, may decide any question which it is
necessary or expedient to decide in connection with the application for rectification.).
97 Harinagar Sugar Mills Ltd. v. Shyam Sunder Jhunjhunwala, (1961) 31 Comp Cas 387.
16

46. Where the Company Law Board has dismissed a petition for want of jurisdiction to decide the
title to the shares, the High Court can rightfully, in an appeal, decide the title of the shares
through the documents and direct the Company to register the transfer.98 Where the power has
been conferred by the statute itself in unambiguous words, it cannot be said that the examination
of questions of title between opposite parties and decisions on questions relating to it are beyond
the jurisdiction and an appeal on such an issue cannot be raised.99
47. Therefore, in the present case, when the Company Law Board has failed to exercise its
jurisdiction in the correct manner, the High Court can, in an appeal under Section 10F, venture
on to decide the questions of title that the Board has wrongly held to be outside the scope and
extent of its power. Hence, it cannot be said that where resolving of such a dispute required the
interpretation of the will, the same cannot be undertaken by the Board.
48. Therefore, the High Court has the power to decide the title by interpreting a will when first, it
arises out of the order of the Company Law Board, and secondly, when it is necessary and
expedient to decide the petition by virtue of the power conferred under Section 111(7).
[D.] Additionally, the interpretation of the Will of King Ray is correct in law.
49. As has been already submitted, the High Court had jurisdiction under Section 10F to interpret a
Will while hearing an appeal against Section 111. It is further submitted that the interpretation
given by the High Court to King Rays Will with respect to the disinheriting of Wild and North
Bilzerian is correct.
50. It is a settled proposition of law that when construing the Will, a construction which would
advance the intention of the testator has to be preferred. 100 In fact, Section 87 of the Indian
Succession Act expressly provides that in the interpretation of a will, effect is to be given to the
intention of the testator as far as possible. 101 Additionally, it is the mode of expression of that
intention and the form and language of the will that hold utmost importance.102
98 K.P. Antony v. Thandiyode Plantations P. Ltd, (1996) 86 Comp Cas 684 (Ker).
99 Harnam Singh v. Bhagwan Singh, (1992) 74 Comp Cas 726 (Del); State of Orissa v. Indian Chemical
Products Ltd., AIR 1957 Ori 203.
100 Bhura v. Kashi Ram, (1994) 2 SCC 111.
101 The Indian Succession Act, No. 39 of 1925, 87.
102 D.N. SEN, INDIAN SUCCESSION ACT, 1925, 243 (5th edn., 2008).
17

51. Section 82 lays down that the meaning of any clause in a will is to be collected from the entire
instrument, and all its parts are to be construed with reference to each other.103 The true intention
of the testator has to be gathered not by attaching importance to isolated expressions but by
reading the will as a whole with all its provisions and ignoring none of them as redundant or
contradictory.104
52. It is in consonance with this principle that the High Court tried to gather the intent of King Ray
from a wholesome reading of the document of will. 105 Admittedly, the will mentions the
disinheriting of the children from claiming any part of King Rays estate, 106 however, it is this
wholesome reading which reflects the underlying intention. The primary concern for King Ray
is that his estranged wife, Queen Carlen, should not grab his property through his children. The
strained relations with Wild and North, as the Will mentions, is due to the influence by their
mother.107 In fact, the word therefore used in the will 108 indicates that the central reason behind
disinheriting is the apprehension that Carlen would have tried to grab the property through the
children.
53. Further, the armchair rule of the construction of the will is that the court is entitled to put itself
in the testators armchair.109 The Court, in determining the intention of the testator, must consider
the surrounding circumstances, the position of the testator, his family relationship and the
probability that he would use words in particular sense. 110 It requires the recreation of the
perspective of the testator to understand the will. 111 In doing so, the court is entitled and bound to
bear in mind other matters than merely the words used in the Will. 112 Applying the principle to
the instant case, the Will reveals the anguished and disturbed state of mind of King Ray. He had
103 The Indian Succession Act, No. 39 of 1925, 82.
104 Navneet Lal v. Gokul, AIR 1976 SC 794.
105 Factsheet 25.
106 Factsheet 16.
107 Factsheet 16.
108 Factsheet 16.
109 N. Kasturi v. D. Ponnammal, AIR 1961 SC 1302; Navneet Lal v. Gokul, AIR 1976 SC 794.
110 Jeaban v. Jitendra, AIR 1949 PC 64; GOPALAKRISHNAN, LAW OF WILLS, 457 (7th edn., 2009).
111 Meena Vasant Patel v. Prithviraj Ambalal Patel, 2010 (6) Mh LJ 539.
112 Lalta Baksh Singh v. Phool Chand, AIR 1945 PC 113.
18

been unwell and succumbed to ill-health which reflects upon the urgent need to address the
reckonings which were going on in his mind. His desire to avoid Queen Carlen from acquiring
any of his property was manifested indirectly through the children.
54. Thus, the interpretation of the Will put forth by the High Court is in consonance with the
principles of construction. Hence, the order of the High Court relying upon such interpretation is
valid.
IV. THE SUCCESSION CERTIFICATE WAS OPERATIVE, AND COULD HAVE BEEN RELIED UPON BY
THE

HIGH COURT.

55. It is submitted that the succession certificate dated May 8, 2009 obtained jointly by Queen Kim
with North and Wild Bilzerian113 was rightly relied upon by the High Court of Thelesalonica to
decide the transmission of shares of King Ray in the company.114 The event of death of Queen
Kim had no effect whatsoever on the validity of the succession certificate. This is because there
is no statutory provision to invalidate the certificate upon death of a joint-holder [A.] and Prior
authorities which have held a succession certificate to become inoperative upon death cannot be
relied upon [B.].
[A.] There is no statutory provision to invalidate the certificate upon death of a jointholder.
56. Section 381 of the Indian Succession Act states the effect of the certificate once it is granted. It
makes the succession certificate granted by the District Judge conclusive as against the persons
owing the debts or liable for the securities specified in the certificate. 115 Subject to the
provisions of this part is the only phrase in the abovementioned section which limits the
conclusiveness of the certificate. Admittedly, there are certain specific provisions in Part X
concerning succession certificates which explicitly defeat the validity of a certificate. However,
none of these are attracted in the situation of death of a joint certificate-holder.

113 Factsheet 18.

114 Factsheet 25.
115 The Indian Succession Act, No. 39 of 1925, 381.
19

57. Section 370 states that a certificate cannot be granted with respect to a debt or a security to which
a right is required to be established by letters of administration or probate.116 Section 385 declares
a certificate to be invalid if there has been a previous grant in respect of the estate. 117 None of the
sections indicate invalidity of a certificate upon death of a joint-holder.
58. Section 383 allows for revocation of certificate in certain specific circumstances, which relate to
the proceedings being defective, certificate obtained fraudulently by a false suggestion or an
untrue allegation or the certificate becoming useless and inoperative, thus allowing for
revocation.118 The phrase useless and inoperative through circumstances under Section 383(d)
has been judicially interpreted to mean the discovery of something which, if known at the date of
the grant, would have formed grounds of refusing it.119 Such discovery must be of something
which was not known, but existed at the time of the grant, like the discovery that the will was
forged, or the existence of a later will or codicil.120 The event of death of a joint-holder of a
certificate subsequent to such grant falls outside of such interpretation. It goes beyond the ambit
of Section 383(d).
59. Therefore, none of the abovementioned sections of Part X causing a certificate to be invalid are
attracted in case of death of one of the holders of a joint succession certificate. Hence, the joint
succession certificate continues to be operative and conclusive by virtue of Section 381.
60. Further, the scheme of the Indian Succession Act itself strongly suggests that the succession
certificate continues to be operative. The Act deals with multiple documents of succession
including probate, letters of administration and succession certificate. It provides for the
consequences that follow after the death of a joint-holder of a probate and a letter of
administration. Section 226 stipulates that in case of death of one of several executors to whom
the probate has granted, the representation of the testator accrues to the surviving executors. 121
Likewise, in case of death of one administrator, the powers under the letters of administration

116 The Indian Succession Act, No. 39 of 1925, 370.

117 The Indian Succession Act, No. 39 of 1925, 385.
118 The Indian Succession Act, No. 39 of 1925, 383.
119 The Indian Succession Act, No. 39 of 1925, 383(d).
120 Bal Gangadhar Tilak v. Sahwarbau, 26 Bom 792; Gour Chandra Das v. Sarat Sundari Dassi, ILR
(1913) 40 Cal 50; Re goods of Gagan Chandra, AIR 1950 Cal 578.
121 The Indian Succession Act, No. 39 of 1925, 226.
20

become vested in the survivors.122 In the presence of such express provisions for these
documents, a corresponding provision can be said to have been implied with respect to a grant of
succession certificate. Thus, on the death of a joint-holder to a succession certificate, the powers
under the certificate get vested in the remaining joint-holders and the certificate continues to be
operative.
[B.] Prior authorities which have held a succession certificate to become inoperative upon
death cannot be relied upon.
61. Admittedly, the Calcutta High Court on one occasion has taken an alternate view in respect of the
validity of a certificate on a joint-holders death in the case of Sukumar Deb Roy v. Parbati
Bala.123 However, it is submitted that [i] The reasoning employed in Sukumar Deb case is not
sound in law and [ii] In any case, the facts of that case were wholly distinct and are inapplicable
to the instant case.
[i] The reasoning employed in Sukumar Deb case is not sound in law
62. The decision is based on the premise that the authority vested in multiple persons by a succession
certificate can only be exercised jointly, and in case one dies, it would become inoperative
because of the inability of the remaining certificate holders to exercise their powers. However, it
is submitted that there is no inability cast upon the remaining certificate holders due to the death
of a joint certificate holder.
63. As the judgment itself acknowledges, a certificate does not confer any title upon the grantee. 124
Such a grant can also be made to a nominee. The object of the grant through summary
proceedings is merely to facilitate the collection of debts, 125 and not to confer status of title upon
the grantee. In other words, it can be said that the position of the holder of the succession
certificate is similar to that a trustee.126 He is merely supposed to manage the assets and liabilities
of the deceased and distribute the benefits devolving upon the heirs of the deceased. As the only

122 The Indian Succession Act, No. 39 of 1925, 312.

123 Sukumar Deb Roy v. Parbati Bala, AIR 1941 Cal 663.
124 Gunindra v. Jagmala, ILR 30 Cal 581.
125 Prankisto v. Nobodip, (1882) ILR 8 Cal 868.
126 State of Chhatisgarh v. Dhirajo Kumar Sengar, AIR 2009 SC 2568.
21

power to be exercised is to realise the debts and give them valid discharge, 127 such power does
not necessarily have to be exercised jointly. The remaining holders can exercise this power even
after the death of a joint-holder.
64. Moreover, if a new grant is required each time a joint-holder dies, it renders the process
extremely inconvenient.128 Such an impediment would hinder the very practice of granting joint
succession certificates. Therefore, the rationale behind the judgment is erroneous in law as well
as in policy. It should be adjudged to be bad in law. Consequently, it cannot be relied upon to
decide the present petition before the Supreme Court.
[ii] In any case, the facts of that case were wholly distinct and are inapplicable to the instant case
65. The facts of the Sukumar Deb case129 involved a joint succession certificate issued to three
daughters with respect to the properties left by their mother. On the death of one of the
daughters, her one-third share of the succession certificate came into question. She had not left a
will. The other two daughters applied for a succession certificate as heirs of the deceased
daughter in respect of the one-third share held by her. However, the husband and the son of the
deceased daughter took objections to the claim of succession certificate asserting that the sisters
were not the legal heirs of the deceased daughter.
66. This fact situation is clearly distinguishable from that in the instant case. Queen Kim has died as
a joint-holder of the certificate.130 However, she, vide her will dated May 10, 2009, had
bequeathed all her properties in favour of the two grandchildren, who are the other joint-holders
to the certificate.131 The one third share vested in her by virtue of the succession certificate is no
more in question. As a result, there is no impediment against North and Wild Bilzerian exercising
the powers vested in them under the succession certificate even on the death of Queen Kim. The
fact situation is certainly different. Therefore, the Sukumar Deb case cannot be relied upon to
decide in the current scenario.
67. Further, in the case of Rajkumar Devraj v. Jai Mahal Hotels Pvt. Ltd.,132 the Supreme Court had
facts which are identical to the instant case. Gayatri Devi, along with her grandchildren Dev Raj
127 First National Bank Ltd. v. Shri Devi, AIR 1968 Punj 252.
128 Shanti v. Pankaj, AIR 1995 P&H 14.
129 Sukumar Deb Roy v. Parbati Bala, AIR 1941 Cal 663.
130 Factsheet 19.
131 Factsheet 20.
132 Rajkumar Devraj & Ors. v. Jai Mahal Hotels Pvt. Ltd., (2013) 135 DRJ 213.
22

and Lalitya Kumari, had obtained a joint succession certificate with respect to Jagat Singhs
property wherein they divided it equally giving them a one-third share each. This was the agreed
settlement after Gayatri Devi had filed a probate petition claimed upon a will left by Jagat Singh,
as was done by Queen Kim in the present case. In fact, the manner in which the will was worded
is identical to that of King Rays will. Jagat Singhs sons sought the rectification of register with
regard to his shares in the company before the Company Law Board. 133 Like in the current
scenario, their claim, too, was based upon the joint succession certificate.
68. When the matter went before the High Court, the respondents relied upon the Sukumar Deb case
to argue that the succession certificate had become inoperative. However, the High Court
rejected such a contention. While noting the facts, it observed that the the facts of the case are
wholly distinct and inapplicable to the present situation. Such a view was then upheld by the
Supreme Court.
69. Similarly, in the identical fact situation that is now present before the Court, the Sukumar Deb
case ought to be distinguished. It holds no relevance whatsoever to decide the validity of the
succession certificate in the current scenario. The Court must hold this case to be inapplicable,
and should disregard the case for purposes of deciding the present petition.

133 Maharaj Devraj v. Jai Mahal Hotels Pvt. Ltd., 2011 SCC OnLine CLB 116.
23

[V] BY VIRTUE OF THE SETTLEMENT DEED, THE PROBATE PROCEEDINGS INSTITUTED BY

QUEEN KIM STAND LAPSED.

70. It is submitted that on the basis of the Settlement Deed dated May 8, 2009 entered into by Queen
Kim and the grandchildren, the probate proceedings under Petition No. 72 of 2006 can be said to
have lapsed. The argument put forth in this regard is two-fold. [A.] Queen Kim no longer pressed
her claim under the probate proceedings and [B.] Application of Order XXIII, Rule 3 of the Code
of Civil Procedure causes the proceedings to lapse.
[A.] Queen Kim no longer pressed her claim under the probate proceedings.
71. It is submitted that even when the Probate petition No. 72 of 2006 was pending, there was no bar
upon Queen Kim from entering into the settlement deed to resolve the dispute. With regard to the
fate of the probate proceedings filed earlier in the District Court, the observations made in
Sakuntala Dasi v. Kusum Kumari Sarkar134 in this regard must be noted. The case involved the
filing of probate proceedings and their subsequent withdrawal, similar to the present case. It was
held that if whether to apply for probate is well within the option of the Appellant, the decision
to discontinue the application would fall within his or her choice too. 135 Such choice should be
left to the dominus litis in the matter present for litigation. In the instant case, Queen Kim was
the sole dominus litis in the petition before the District Judge. Hence, the matter and the choice
to not assert her right based upon the will must be left to her charge.
72. Her choice to not assert her claim upon the will is apparent from the facts. Queen Kim entered
into the settlement deed with her grandchildren to obtain the succession certificate on the very
same day136, and after a short duration of time in the same year, she died. 137 Her intention to settle
ongoing disputes with the grandchildren is evident. This intention to resolve all disputes is
further substantiated by her will dated May 10, 2009, by which she bequeathed all her properties

134 Sakuntala Dasi v. Kusum Kumari Sarkar, AIR 1971 Ori 103.
135 Sakuntala Dasi v. Kusum Kumari Sarkar, AIR 1971 Ori 103.
136 Factsheet 18.
137 Factsheet 19.
24

in favour of North and Wild.138 It is amply clear that Queen Kim did not press her right to King
Rays property under the Probate proceedings.
73. In such a situation which exists, the Court cannot assume solely upon itself the burden to
determine the genuineness of the will. Such burden would be extremely difficult to discharge
without the assistance of the Appellant in case he or she does not appear before the court and the
proceedings continue ex parte.139 The only recourse left to the Court is to conclude that the
proceedings have lapsed.
74. Moreover, in a situation when the Appellant himself discontinues pursuing the matter, there is no
method prescribed under law to compel such person into taking steps towards the proceedings. 140
Queen Kim must be imputed with the knowledge of the consequences from such withdrawal.
She cannot be pushed to continue pursuing her application.141
75. Further, it is submitted that by virtue of Section 268 of the Indian Succession Act, the provisions
of the Code of Civil Procedure apply in respect of the proceedings. Having established the
intention of Queen Kim against claiming her right under King Rays wills, she no longer pursues
the probate proceedings in court. In this scenario, Order IX Rule 3 of the Code of Civil
Procedure will apply.142 As Queen Kim would not make an appearance before the court in the
matter, the suit would stand dismissed for a default of appearance.
76. Therefore, Queen Kim no more presses her claim under the will in the probate petition. Hence,
based upon the settlement deed dated May 08, 2009, the probate proceedings no. 72 of 2006 filed
by her have lapsed.
[B.] Application of Order XXIII, Rule 3 of the Code of Civil Procedure causes the
proceedings to lapse.
77. It is submitted that [i] the provisions of the Code of Civil Procedure will be applicable to the
probate proceedings and [ii] Order XXIII, Rule 3 recognizes the compromise of such
proceedings by way of an agreement, which in the instant case, is the Settlement Deed. Further,
(iii) even if the Rule 3 is assumed to inapplicable, the abandonment of claim under Order XXIII,
Rule 1 results in a lapse.
138 Factsheet 20.
139 Sakuntala Dasi v. Kusum Kumari Sarkar, AIR 1971 Ori 103.
140 Sakuntala Dasi v. Kusum Kumari Sarkar, AIR 1971 Ori 103.
141 Damyanti Rai Bakshi v. Maharaj Kumar Mehta, AIR 2004 Delhi 422.
142 Code of Civil Procedure, Act No. 5 of 1908, Order IX, Rule 3 (1908).
25

[i] The provisions of the Code of Civil Procedure will apply.

78. All the concerned parties to the dispute are Hindus. 143 The matter of probate proceedings will be
governed by the provisions contained in Part IX of the Indian Succession Act, 1925. Section 268
of the Act, in plain words, requires the proceedings before the District Judge, in relation to the
granting of probate, to be regulated by the Code of Civil Procedure, 1908. 144 The reason is that
the forum where the proceedings take place is a civil court and the subject matter is civil in
nature.
79. In fact, Section 268 voices the principle laid out in Section 141 of the Code of Civil Procedure
itself, which states that the procedure in the Code is to be followed as far as it can be made
applicable, in all proceedings before any court of civil jurisdiction. 145 Such miscellaneous
proceedings would include the probate proceedings regarding King Rays will that are in
question before the District Judge of Thelesalonica. Therefore, the provisions of Code of Civil
Procedure will be applicable in deciding the status of the pending probate proceedings.
[ii] Order XXIII, Rule 3 of the Code of Civil Procedure recognizes the compromise of pending
proceedings by way of an agreement, which in the instant case, is the Settlement Deed.
80. In cases when the subject matter of a suit is adjusted by any agreement, the Rule 3 mandates the
Court to record such agreement and pass a decree in accordance therewith. 146 Thus, there exists
no bar upon parties to probate proceedings to settle the dispute by entering into an agreement.
81. The provision requires such an agreement to be lawful. Admittedly, an agreement for the grant
or rejection of a probate dispensing away with the proof of the will and stipulating the exclusion
of evidence is against public policy and hence, unlawful. 147 However, the settlement deed entered
into by Queen Kim and the grandchildren is dissimilar in nature. It is not a compromise
regarding the genuineness of the will. An agreement regulating the rights of the parties inter se
laying out the division of the estate, like the settlement deed entered into in the instant case, is
valid.148 Thus, the settlement deed is lawful for the purposes of this provision.
143 Clarification No. 1.
144 The Indian Succession Act, No. 39 of 1925, 268 (1925).
145 Code of Civil Procedure, Act No. 5 of 1908, 141 (1908).
146 Code of Civil Procedure, Act No. 5 of 1908, Order XXIII, Rule 3 (1908).
147 Gouri Shankar v. Hari Bhobini, 41 CWN.
148 Jugdish v. Upendra, 48 CWN 294.
26

82. There is no question upon the fact that the settlement deed and the issuance of the succession
certificate had adjusted the probate petition first filed by Queen Kim. The claim to rectification
of register in respect of King Rays shares was earlier claimed upon the will by her. The basis of
the claim shifted to the succession certificate instead of the probate upon the settlement.
83. The Rule 3 does require the Court to record such agreement and pass a decree in accordance with
the agreement between the parties.149 However, the rule does not lay down any particular
procedure by which the agreement may be recorded150 and the passing of such a decree has even
been postponed in certain circumstances by the Court. 151 Recognition of such agreement is
indicative of being in sufficient compliance with the requirements of the Rule 3. Hence, on such
compliance with Order XXIII, Rule 3, the probate proceedings in relation to King Rays will
which are pending are drawn to a close and they, in effect, lapse.
[iii] Even if the Rule 3 is assumed to be inapplicable, the abandonment of claim under Order
XXIII, Rule 1 results in a lapse.
84. It is submitted that in the situation that the application of the Rule 3 to the instant case is
assumed to be dismissed, Order XXIII, Rule 1 will be applicable. 152 The Rule 1 provides for
abandonment of the suit or a part of the claim by a person after the institution of the suit by him.
This amounts to an unconditional withdrawal from the proceedings in the suit. Such withdrawal
does not need a formal order of the court granting permission. 153 When the suit is found to have
been discontinued without the leave of the court, there does exist a bar upon bringing a fresh suit
in respect to the same subject-matter.154 However, the impact of such withdrawal upon deciding
the fate of the present proceedings does not differ. The effect is that the parties are left in the
same position which they had occupied if no such suit had been instituted. 155 In other words, the
proceedings can be termed to have lapsed upon abandonment of the claim.
149 Code of Civil Procedure, Act No. 5 of 1908, Order XXIII, Rule 3 (1908).
150 Laraite Devi v. Sitaram, AIR 1957 All 820.
151 Kumar Abhayanand v. Maharajadhiraj Rameshwar, AIR 1930 Pat 395.
152 Code of Civil Procedure, Act No. 5 of 1908, Order XXIII, Rule 1 (1908).
153 Nila Baurat Engg. Ltd v. Rajasthan Urban Infrastructure Project, AIR 2004 Guj 221.
154 Hari Ram v. Lichmaniya, AIR 2004 Raj 319; S.C. SARKAR, THE LAW OF CIVIL PROCEDURE, 1976
(11th edn., 2006).
155 Permanand v. Prescribed Authority (Munsif City), 2002 AIHC 15 (18).
27

85. Thus, when Queen Kim no longer presses her under King Rays will, the application of the rules
contained in Order XXIII of the Code of Civil Procedure, 1908 causes a lapse of the pending
petition by Queen Kim. Hence, by virtue of the Settlement deed entered into on May 08, 2009,
the probate proceedings no. 72 of 2006 in relation to King Rays will pending before the District
Court can be said to have lapsed.

28

PRAYER

Wherefore in light of the issues raised, arguments advanced and authorities cited, it is humbly
prayed that this Honourable Court may be pleased to adjudge and declare that:
1. The High Court had rightly exercised its jurisdiction under Section 10F while hearing an
Appeal against Section 111 of The Companies Act.
2. The High Court could have heard and decided various aspects and disputes pending
adjudication in the courts below which were in the nature of civil disputes.
3. The High Court could have interpreted a will while exercising jurisdiction under Section
10F.
4. The High Court rightly relied upon the joint succession certificate even after one of the
members to the same certificate had expired.
5. Probate proceedings stand lapsed on the basis of settlement dated May 8, 2009 entered
into between some of the parties.
And pass any other order that this Honourable Court may deem fit in the interests of justice,
equity, and good conscience.
All of which is humbly prayed,
1612 R,
Counsel for the Respondents.

29