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2003(6) Supreme 981
SUPREME COURT OF INDIA
(From Delhi High Court)
V.N. Khare, CJI., S.B. Sinha, J.
Illachi Devi (D) by Lrs. & Ors. -Appellants
versus
Jain Society, Protection of Orphans India & Ors. -Respondents
Civil Appeal No. 8080 of 2003
(Arising out of SLP (C) No. 242 of 2002)
Decided on 26-9-2003
Counsel for the Parties :
For the Appellants : J.K. Seth, Sr. Advocate and Ms. Madhu Sikri, Advocate.
For the Respondents : L. Nageswara Rao, Sr. Advocate, Sudhir Nandrajog, Advocate.
Held : A Society registered under the Societies Registration Act is not a body-corporate as is the case in respect of a company registered under the Companies Act. In that view of the matter, a Society registered under the Societies Registration Act is not a juristic person. The law for the purpose of grant of a probate or Letter of Administration recognises only a juristic person and not mere conglomeration of persons or a body which does not have any statutory recognition as a juristic person. (Para 21)
Held further :Although admittedly, a registered society is endowed with an existence separate from that of its members for certain purposes, that is not to say that it is a legal person for the purposes of Sections 223 and 236 of the Act. Whereas a company can be regarded as having a complete legal personality, the same is not possible for a society, whose existence is closely connected, and even contingent, upon the persons who originally formed it. Inasmuch as a company enjoys an identity distinct from its original shareholders, whereas the society is undistinguishable, in some aspects, from its own members, that would qualify as a material distinction, which prevents societies from obtaining letters of administration. (Para 23)
Held also : A bare perusal thereof would show that a society registered under the Societies Registration Act as contra-distinguished from a company registered under the Company Act cannot sue in its own name. It is to be sued in the name of the president, chairman, or principal secretary or trustees as shall be determined by the rules and regulations of the society or in the name of such person as shall be appointed by the Governing Body for the occasion in default of such determination. It is, therefore, not correct to contend that it is capable of suing or being sued in its own name. (Para 31)
Held consequently :Keeping in view the legislative policy we are of the opinion that the High Court was not correct in its view that an Administration can be granted in favour of a society registered under Act 21 of 1860. (Para 47)
Held thereafter :Grant of probate in favour of society registered under the Societies Registration Act is refused, as discussed hereinbefore, inter alia on the ground it is not a juristic person. It, in a litigation, must be represented through a person authorised in this behalf either in terms of its bye-laws or otherwise. We, however, intend to lay emphasis on the fact that a will or gift in favour of a society is not totally unenforceable in law. A probate or Letter of Administration with a copy of the will annexed although may not be granted in favour of a society but may be granted in favour of a person authorised by a society either in terms of the statute or a resolution adopted in this behalf by the society, as the case may be, so that such person may be answerable to the Court. On grant of Letter of Administration the person so nominated by the society shall carry out the wishes of testator for the benefit of society. Before parting, however, we may add that growing needs of the country in this field of law appears to have not received sufficient attention of the Parliament. Existing law is required to be suitably amended to meet the requirement of changing scenario. A Society registered under the Societies Registration Act in the changed scenario play an important role in society. They discharge various functions which are beneficial to the society. They run educational and other institutions. They sometimes work in public interest and act in aid of State functions. They have their own accountability. They sometimes incur liabilities. Public Interest Litigations filed by Societies are galore. (Paras 51 to 54)
Held finally : For reasons stated above, the appeal is allowed in part. The judgment under challenge stands modified. The matter is sent back to the High Court with liberty to respondent to amend the petition for grant of Letter of Administration. It would be open to the respondent-society to nominate any of its office-bearer to whom Letter of Administration is granted. Such nominated person may move application for substitution of his name for grant of Letter of Administration. If such amendment application is made, the High Court shall permit this amendment and grant Letter of Administration in favour of person nominated by the society for carrying of the wishes of the testator which is for the benefit of the society. (Para 55)
JUDGMENT
V.N. Khare, CJI.-Leave granted.
2. This appeal is directed against the judgment and order dated 17th August, 2001 of the High Court of Delhi, which raises a question, whether a Society registered under the Societies Registration Act, 1860 is entitled to obtain Letter of Administration under Section 236 of the Indian Succession Act (in short "the Act")?
3. The facts giving rise to this appeal are these :
One Ratan Lal executed a Will on 15.10.1977 bequeathing a part of his estate to Jain Bal Ashram which is run by the Jain Society (hereinafter referred to as "the Society") formed for protection of orphans in India. The Society is registered under the Societies Registration Act, 1860. On 4th March, 1978, Ratan Lal, the testator died. On his demise, the Society submitted an application before the Court for grant of Letter of Administration in pursuance of Will executed by late Ratan Lal, under Section 276 of the Act. The said petition was contested by the appellant and on her death by her legal representatives, on the ground that the petition filed by the Respondent-Society is not maintainable in view of Section 236 of the Act. The High Court being of the view that it is permissible under Section 236 of the Act to grant Letter of Administration in favour of the Society, rejected the objection of the appellant and, it is in this way, the appellants are before us by means of a special leave petition.
4. Before we proceed on the merits and take up the question for answer, it would be expedient to set out the relevant provisions of the Act.
5. Section 218 of the Act provides that to whom letter of administration be granted where the deceased is a Hindu, Mohammadan, Sikh, Jaina or exempted persons. Section 218 of the Act runs as under:-
"(1) If the deceased has died intestate and was a Hindu, Muhammadan, Buddhist, Sikh or Jaina or an exempted person, administration of his estate may be granted to any person who, according to the rules for the distribution of the estate applicable in the case of such deceased, would be entitled to the whole or any part of such deceased s estate.
(2) When several such persons apply for such administration, it shall be in the discretion of the Court to grant it to any one or more of them.
(3) When no such person applies, it may be granted to a creditor of the deceased."
6. Section 223 of the Act provides that to whom probate cannot be granted. Section 223 of the Act runs as under:-
"223. Persons to whom probate cannot be granted.-Probate cannot be granted to any person who is a minor or is of unsound mind nor to any association of individuals unless it is a company which satisfies the conditions prescribed by rules to be made by notification in the Official Gazette, by the State Government, in this behalf."
7. Section 236 provides that to whom letter of administration cannot be granted. The said Section runs as under :-
"236. To whom administration may not be granted.-Letters of administration cannot be granted to any person who is a minor or is of unsound mind, nor to any association of individuals unless it is a company which satisfies the conditions prescribed by rules to be made by notification in the Official Gazette, by the State Government in this behalf."
8. Section 236, as originally, enacted, prohibited grant of letters of administration to any person who was a minor or of unsound mind. By amending Act of 1983, the following provision was inserted in Section 236:-
"..... nor to any association of individuals unless it is a company which satisfies the conditions prescribed by rules to be made by notification in the Official Gazette..."
9. A perusal of sub-section (2) of Section 218 shows that it grants to the Court ample discretion in the matter of grant of Letter of Administration where a testator dies intestate. The object behind granting discretion to the Court is that where a person dies intestate, the person in whose favour the Letter of Administration is granted, is required to carry out certain
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