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1944 Supreme(SC) 27
PRIVY COUNCIL [ON APPEAL FROM THEEAST INDIES]
LORD PORTER, LORD GODDARD AND SIR MADHAVAN NAIR.
PANDIT SHAMBHU NATH SHIVPURI - Appellant
Versus
PANDIT PUSHKAR NATH - Respondents
On appeal from the High Court at Lahore.
Decided On : July. 27. 1944.
Solicitors for appellant: Hasties.
Solicitors for first respondent: Hy. S. L. Polak & Co.
In joint bank deposits, there is a presumption of a resulting trust in favor of the depositor unless a contrary intention, such as an intention for advancement, is proven. This principle applies regardless of the relationship between the depositor and the joint holder.
Headnote:(A) Property Law - Joint Bank Deposits - Resulting Trust - Deposit by a person in a bank in joint names, payable to the survivor, does not constitute a gift to the joint holder; in the absence of proof of a contrary intention, there is a resulting trust in favor of the depositor. This rule is of universal application regardless of the property involved or the relationship between the parties. (Para 1)
(B) Evidence of Contrary Intention - Advancement - To rebut the presumption of a resulting trust, the joint holder must establish a contrary intention, such as an intention for advancement. An inference of advancement may be drawn from the nature of the relationship, the pattern of transfers, and the selection of joint holders, particularly where joint holders are individuals unlikely to be used as mere nominees, such as destitute widows or purdanashin ladies. (Paras 2-4)
Facts of the case:
A suit was initiated for the partition of the estate of a deceased person. The assets included fixed deposit receipts, postal cash certificates, and shares held in the joint names of the deceased and various relatives. The dispute centered on whether these joint holdings were held by the relatives as nominees, meaning they remained the absolute property of the deceased for partition, or whether they were intended as advancements for the benefit of the joint holders.
Findings of Court:
The court found that the evidence, including the deceased's conduct in transferring investments and the choice of joint holders, established an intention to provide advancement for the relatives. The court noted that the use of purdanashin ladies and destitute widows as joint holders strongly suggested that they were not mere nominees. Consequently, these assets were excluded from the partible estate.
Issues: Whether assets held in joint names were the absolute property of the deceased at the time of death or were intended for the advancement of the joint holders.
Ratio Decidendi: While the general rule for joint accounts is a resulting trust in favor of the depositor, this presumption is rebuttable. The court held that the specific circumstances—including the pattern of transfers and the identity of the joint holders—provided sufficient evidence of a contrary intention to treat the deposits as advancements rather than benami holdings.
Result: Appeal dismissed.
Legal Category Hierarchy
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family law
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succession
- partition
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succession
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property law
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trusts
- resulting trust
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gifts
- advancement
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trusts
Judgement
Appeal (No. 39 of 1943) from a decree of the High Court (May 15, 1942) which had modified a decree of the Subordinate Judge of Delhi (January 29, 1940).
The following facts are taken from the judgment of the Judicial Committee The suit out of which this appeal arose was initiated on November 1, 1938, for the partition of the estate of Pandit Basheshwar Nath Shivpuri, who had recently died. The appellant was one of his nephews. There were four defendants, and the relationship of the parties one to the other is shown by the table following —
Law. Rep. 71 Ind. App. 197 ( 1943- 1944) Pandit Shambhu Nath Shivpuri V. Pandit Pushkar Nath
86
JAWALA NATH
|
| | | | |
Bishambar Niranjan Basheshwar Mussammat Amar Mussamm
Nath Nath Nath = Radhika Rani Nath = at Tej Rani
| | (died on (died in 1930) (died in
| 22-7- 1938 1919)
| |
|
| | | Autar Nath | Tirbhawan | Shambhu Ram Nath | Mussam
| | | (defendant 2) Nath (defendant 3) Nath (plaintiff) | (dead) = mat Janak Dulari
| | | |
Hirdey Mussammat Pushkar Dina Nath
Nath = Iqbal Rani Nath |
(died on (defendant
28-4- 1938 No. 1)
|
Brij Mohan
Nath
The fourth defendant, Pran Kishori, was a niece (the daughter of the deceased mans wifes sister).
Among the assets left by the deceased were the following — (1.) Fixed deposit receipt of the Central Bank of India, Limited, for Rs. 48,500, in the joint names of the deceased and the first defendant. (2.) Ditto for Rs. 7,000 in the joint names of the deceased and the second defendant. (3.) Five postal cash certificates of Rs. 1,000 each, in the joint names of the deceased and the second defendant. (4.) Four ditto, in the joint names of the deceased and one Hirdey Nath, elder brother of the first defendant, then deceased. (5.) Hundred shares in the Central Bank of India, Limited, value Rs. 3,130-4-0, in the joint names of the deceased and the first defendant. (6.) Fixed deposit receipt of the Punjab National Bank, Limited, for Rs. 4,000, in the joint names of the deceased and the fourth defendant. (7.) Rs. 279-10-6 in the Home Saving Safe Account of the Central Bank of India, Limited, in the joint names of the deceased and the first defendant. (8.) Rs. 450 in cash (spent on funeral expenses). (9.) A pucca house, No. 1550— Ward No. 9, in Delhi.
As appears from that list certain of the assets were held in joint names, and the question which the Board had to determine was whether the Subordinate Judge was right in saying that those assets were nevertheless the absolute property of the deceased man at the time of his death, or whether his object was that they should be so held for the advancement of those whose names were joined with his in the several instances.
The first court held that all the joint holdings stood in the names of the parties to the suit as nominees, except that in the name of the fourth defendant, Pran Kishori. The High Court (Tek Chand and Beckett JJ.) agreed in the last result, but held that all the joint holdings, like hers, were for the advancement of those whose names were joined with that of the deceased and should be excluded from the partition.
Law. Rep. 71 Ind. App. 197 ( 1943- 1944) Pandit Shambhu Nath Shivpuri V. Pandit Pushkar Nath
87
1944. June 28, 29. Bagram for the appellant. Ritson for the first respondent.
July 27. The judgment of their Lordships was delivered by Lord Porter, who stated he facts set out above and continued The law in India in this matter is not in doubt, and is authoritatively stated by their Lordships in Guran Ditta v. Ram Ditta (( 1928) L. R. 55 I. A. 235.) in the words " the deposit by a Hindu of his " money in a bank in the joint names of himself and his wife " and on terms that it is payable to either as survivor d6es not " on his death constitute a gift by him to his wife. There is a " resulting trust in his favour in the absence of proof of a " contrary intention, there being in India no presumption of an " intended advancement in favour of a wife.” The rule, however, is not confined to as
