Do senior PhD students form a part of the admission commitee? Recently, I was having a chat with a few senior PhD students (almost done with their thesis) and they pointed out that the professors would, at times, solicit their opinion regarding the admission of a particular student. This was especially true when the prospective student belongs to the same country as that of the senior PhD student.

Does this happen in all institutes? 

If it does happen, is it official or discussed-over-coffee unofficial?
Not a particularity helpful answer, but ...

No, it does not happen at all institutes, but it does happen at many. In some cases it is official and in other cases it is unofficial.

As an applicant you should assume that the entire time you are on campus is part of the interview including any drinks/meals.