The Bombay High Court has held that a deed recording the dissolution of a commercial partnership, by itself, is insufficient to establish either the existence of a Hindu Undivided Family (HUF) or an ancestral nucleus capable of treating subsequently acquired properties as joint family properties.

The Court observed that such a document merely evidences the dissolution of a business partnership and cannot, without independent evidence demonstrating the continued existence of an ancestral nucleus and its nexus with later acquisitions, support a claim that properties acquired decades thereafter constitute HUF property.

The Court was hearing an interim application in a suit seeking declarations that several immovable properties and business interests constituted the assets of an alleged Hindu Undivided Family (HUF), along with consequential reliefs including partition, cancellation of certain gift deeds and transfers, and, alternatively, enforcement of a Will in respect of properties claimed to be the deceased's self-acquired assets.

A Single Judge Bench of Justice Farhan P. Dubash observed: "The sole document relied upon by the Plaintiffs to establish the existence of the alleged ancestral nucleus is the Deed of Dissolution dated 28th April 1956. Prima facie, this document advances the Plaintiffs' case no further. At the highest, it evidences that certain persons were carrying on business through a partnership which came to be dissolved in the year 1956. A deed dissolving a commercial partnership cannot, without anything more, establish either the existence of an HUF or the continued existence of an ancestral nucleus capable of financing acquisitions made decades thereafter."

The Bench further observed: "Mere assertions that the family was engaged in several businesses, or that income was generated from those businesses, cannot substitute legal proof. The Plaintiffs have produced no books of account, income-tax records, balance sheets, financial statements, acquisition documents or any contemporaneous evidence capable of even prima facie establishing that the acquisitions were made from joint family funds... Instead, the Plaintiffs' entire case is founded on inference and conjecture."

Advocate Ashok Dhanuka represented the plaintiffs, while Senior Advocate Sharan Jagtiani represented the defendants.

Background

The suit sought declarations that various hotel properties, partnership interests, shares and other assets formed part of an HUF allegedly originating from the plaintiffs' common ancestor. In the alternative, the plaintiffs asserted rights under the Will of their deceased mother in respect of certain properties claimed to be her self-acquired assets. Pending disposal of the suit, they sought interim orders restraining the defendants from alienating or otherwise dealing with the disputed properties.

To establish the existence of an ancestral nucleus, the plaintiffs principally relied upon a Deed of Dissolution executed in 1956 relating to a family partnership, contending that it demonstrated the existence of a long-standing commercial enterprise from which the disputed properties were subsequently acquired. They also relied upon a family arrangement, alleged family business practices and a registered Will. The defendants argued that the plaintiffs had failed to produce any documentary evidence linking the alleged ancestral nucleus with the acquisition of the disputed properties and that their claims were legally inconsistent.

Court's Observations

The Court reiterated the settled principle that there is no presumption that every Hindu family possesses joint family property or that every property standing in the name of a family member automatically acquires the character of HUF property.

The Court elaborated that the burden initially rests upon the party asserting such a claim to establish both the existence of a joint family nucleus and a reasonable nexus between that nucleus and the acquisition of the properties sought to be treated as HUF assets. Only thereafter does the evidentiary burden shift to the person asserting self-acquisition.

In this regard, the Court relied upon the Supreme Court's decisions in D.S. Lakshmaiah v. L. Balasubramanyam (2003) and Angadi Chandranna v. Shankar (2025).

Examining the material relied upon by the plaintiffs, the Court found that the 1956 Deed of Dissolution merely evidenced the dissolution of a commercial partnership and did not establish either the existence of an HUF or a continuing ancestral nucleus.

The Court further noted that the principal properties in dispute had been acquired nearly two decades after the dissolution of the partnership, yet the plaintiffs had produced no material demonstrating the existence of any continuing ancestral fund during the intervening period or showing that the consideration for those acquisitions originated from such a nucleus.

The Bench also rejected the contention that a family arrangement executed decades later amounted to an admission that the properties were HUF assets.

The Court observed: "The mere execution of a family arrangement does not, by itself, determine the juridical character of the properties dealt with therein. Whether parties chose to settle disputes amongst themselves cannot be elevated into proof of the existence of an HUF, particularly in the complete absence of foundational evidence establishing the existence of such HUF."

The Court further found that the plaintiffs' own pleadings substantially weakened their case. While asserting that the disputed properties belonged to an HUF, they simultaneously claimed rights over the same properties under the Will of their deceased mother.

Observing that these positions were fundamentally irreconcilable, the Bench held: "These two foundations are not merely alternative legal pleas; they are fundamentally destructive of one another. If the properties truly constituted coparcenary properties of an HUF, late Veena could not ordinarily claim absolute testamentary authority over them. Conversely, if the Plaintiffs' rights flow under late Veena's Will, the premise necessarily is that the properties were capable of testamentary disposition by her in her individual capacity. Both propositions cannot simultaneously co-exist in respect of the same properties."

The Court also noted that, while the plaintiffs challenged certain documents allegedly executed by their deceased mother as having been procured through fraud, coercion and undue influence, they simultaneously sought enforcement of another testamentary document executed by her. The Court found this approach to considerably undermine the credibility of the plaintiffs' case at the interlocutory stage and held that the Supreme Court's decisions in Ravinder Nath Agarwal v. Yogender Nath Agarwal (2021) and N. Thajudeen v. Tamil Nadu Khadi and Village Industries Board (2024) supported the defendants' contentions.

Rejecting the plaintiffs' contention that only one branch of the alleged HUF was required to be before the Court, the Bench held that if the very existence and partition of an HUF were in issue, every branch claiming through the common ancestor would prima facie be a necessary party. In doing so, it distinguished the Supreme Court's decision in Mumbai International Airport Pvt. Ltd. v. Regency Convention Centre and Hotels Pvt. Ltd. (2010) and found the Madras High Court's decision in M. Ramaswamy v. M.R. Vijayan (2019) to be applicable.

The Court further found that the plaintiffs had failed to substantiate their allegations of fraud and undue influence regarding the gift deed relating to one of the properties. It noted that the plaintiffs had knowledge of the gift deed since at least 2021 but instituted proceedings only in 2025, after the death of both the donor and the donee, without offering any satisfactory explanation for the delay.

Similarly, allegations regarding undervaluation of property, clandestine transfers and acquisition of partnership interests from family funds were held to be unsupported by any documentary evidence. The Court observed that, despite repeated opportunities during the hearing, the plaintiffs were unable to produce any contemporaneous material demonstrating either the existence of the alleged HUF, the continuance of an ancestral nucleus or the flow of funds from such nucleus into the acquisition of the disputed properties.

Summarising its findings, the Court observed: "The present Interim Application therefore proceeds almost entirely on assumptions: first, that an HUF existed; secondly, that it possessed a substantial ancestral nucleus; thirdly, that the nucleus continued for decades; fourthly, that subsequent acquisitions were financed from that nucleus; and finally, that every property listed in Schedule 1 Assets and presently standing in individual names consequently acquired the character of HUF property. None of these assumptions is presently supported by cogent material."

The Bench emphasised that interim injunctions cannot be granted on speculative claims and held: "The jurisdiction to grant interim injunctions cannot be exercised on speculative or conjectural claims. Before the Court restrains persons who admittedly hold title or possession of valuable assets from dealing with their properties, the applicant must establish at least a credible and legally sustainable prima facie right. The Plaintiffs have failed to cross even this threshold."

Conclusion

Holding that the plaintiffs had failed to establish a prima facie case, the Court observed that their claims suffered from the dual infirmities of the absence of foundational evidence and mutually destructive pleas. Finding that the interim application was founded more on suspicion than prima facie proof, the Court dismissed the application, holding that the balance of convenience favoured preserving the rights of those presently holding title to the properties.

Cause Title: Arti Varun Kejriwal & Ors. v. Vandana Vinay Awatramani & Ors.

Plaintiffs: Advocate Ashok Dhanuka with Advocates Prashant Pande and Nikhil Sonar, instructed by W3 Legal LLP.

Defendants: Senior Advocate Sharan Jagtiani with Advocates Shyam Kapadia, Dhiraj Mhetre, Smiti Tewari, Satyasrikant Vutha, Simran R. Grover, Aditya Nair and Siddharth Joshi, instructed by Khaitan Legal Associates; Senior Advocate Haresh Jagtiani with Advocate Janhavi Vora; Advocate Aniket Malu; Advocate Karl Tamboly with Advocate Biswadeep Chakravarty; Advocate Rumi Mirza with Advocate Devika Kamble, instructed by Dipesh Mehta & Associates

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