MINORS�۪ RIGHT TO OBJECT TO SALE OF THEIR SHARE IN JOINT FAMILY PROPERTY

1. Background:

1.1     This article examines the right of a minor to (a) object to sale of his/her share in the joint family property, and (b) get the sale made in favour of a third party purchaser declared void.                               

1. Relevant Provisions Of Law:

2.1     Given below is a brief summary of the relevant provisions of the Law which govern matters relating to (a) joint Hindu family, and (b) joint Hindu family property:

(a)     Schools of Law:

1. The laws governing the Hindus, and their right to property are as follows:
2. Mitakshara Law; and
3. Dayabhaga Law.
4. The Mitakshara Law applies to the whole of India, except Bengal and Assam, where the Dayabhaga Law applies[1].

(b)     Joint Hindu Family:

Pursuant to the amendments brought by the Hindu Succession (Amendment) Act, 2005, a joint Hindu family consists of all persons lineally descended from a common ancestor, and includes their wives and unmarried daughters.

(c)     Classification of Property[2]:

(i)      According to the Hindu law, a property may be classified as:

 1.      Joint family property; and

 2.      Separate property.

(ii)     While, a joint family property is a property in which every member/coparcener of the family has a joint interest and joint possession, and is synonymous with ‘coparcenary property’, a separate property is a property which belongs exclusively to one member of the family, and is synonymous with ‘self acquired property’.

(d)     Management of Joint Family Property[3]:

A property belonging to a joint Hindu family is ordinarily managed by the father or other senior member of the family, and such member of the family is called the ‘Karta’ of the family.

(e)     Alienation of the Joint Family Property by the Karta:

1. The Karta of a joint Hindu family is entitled to alienate the joint family property, with or without the consent of other members of the joint family. The alienation of the joint family property, without the consent of the joint family members, can be made by the Karta inter alia for the following purposes:
2. Legal necessity[4]; and/or
3. Benefit of the estate[5].
4. The following instances are construed to mean ‘Legal necessity’[6]:
5. Payment of government revenue and of debts which are payable out of the family property;
6. Maintenance of coparceners and of the family members of their families;
7. Marriage expenses of male coparceners and of the daughters of the coparceners;
8. Performance of necessary funeral or family ceremonies;
9. Costs of necessary litigation in recovering or preserving the estate;
10. Costs of defending the head of the joint family or any other member against a serious criminal charge; and
11. Payment of debts incurred for family business or other necessary purpose.

(f)      Burden of Proof of Necessity[7]:

          Where the Karta of a joint family sells (or mortgages) joint family property, the purchaser (or the mortgagee) is bound to inquire into the necessity for the sale or mortgage, and the burden lies on the purchaser (or the mortgagee) to prove that there was, in fact, a legal necessity or such sale (or mortgage) was made for the benefit of the estate, and that he made proper and bona fide enquiry as to the existence of such necessity or benefit, and he did all that was reasonable to satisfy himself as to the existence of such necessity.

2.2     Section 38 of the Transfer of Property Act, 1882 (“TP Act”) deals with the rights of the purchaser of a property who uses reasonable care and acts in good faith, and reads as follows: “Where any person, authorized only under circumstances in their nature variable to dispose of immovable property, transfer such property for consideration, alleging the existence of such circumstances, they shall, as between the transferee on the one part and the transferor and other person (if any) affected by the transfer on the other part, be deemed to have existed, if the transferee, after using reasonable care to ascertain the existence of such circumstances, has acted in good faith”.

1. Relevant Judgements:

3.1     Given below are some relevant judgments passed by various courts in India in respect of issues relating to joint Hindu family property, and its alienation by the Karta:

1. The High Court of Andhra Pradesh in the case of Koutarapu Venkata Chenchayya Versus Koutarapu Ramalingam and Others[8] has observed that ‘the Karta of a joint Hindu family is entitled to alienate for value, joint family property, so as to bind the interest of both adult and minor coparceners in the property, provided the alienation is made for legal necessity and/or the benefit of the estate’.
2. The High Court of Kerala in the case of Kumaraswami Mudaliar and Others Versus Rajamanikkam Udayar and Others[9] has observed that ‘an alienation made by a coparcener, manager or father in excess of his powers is liable to be set aside at the instance of the other coparceners. An alienation of ancestral property by the father or manager of the joint family, even when not for the discharge of antecedent debt or for the benefit or necessity of the family is only voidable and not void’.
3. The Supreme Court of India in the case of Raj Kumar Raghubanchmani Prasad Narain Singh Versus Ambica Prasad Singh (Deceased) and Others[10] observed that ‘alienation made by the Manager of the joint family property without legal necessity and /or for benefit of the estate is voidable and not void’.
4. The High Court of Gauhati in the case of Commissioner of Income Tax Versus Gangadhar Sikaria Family Trust and Kamakhya Rice Mill Trust[11] has observed that ‘If a karta alienates the property of an HUF including the interest of the minor for the benefit of the estate or for legal necessity such alienation is valid…………. Even otherwise, such alienation by the karta, in respect of the HUF including the interest of the minor is only voidable and not void…………. Even if the transfer is not for the legal necessity and for the benefit of the estate, the transfer by the karta will be only voidable’.
5. The Privy Council in the case of Ramanathan Chettiar Versus Viswanathan[12] has observed that ‘The purchaser is bound to enquire into the necessities for the family to sell, and to satisfy himself, as well as he can, with reference to the parties with whom he is dealing, that the manager is acting in the particular instance for the benefit of the estate’.
6. The High Court of Andhra Pradesh in the case of B Ranga Rao and Others Versus Venkata Krishna Rao and Others[13] has observed that ‘the alienee, in this case, therefore, had to establish on the following two things: (a) the transaction was in fact justified by legal necessity or for the benefit of the estate, or (b) they had made reasonable and bona fide enquiries as to the existence of the necessity and satisfied themselves that the manager was acting for the benefit of the estate’.
7. Observations on Minors’ Right:

4.1     In view of the aforesaid provisions of law, and the judgements passed by various Indian courts , we are of the view that while a minor (being a member of a joint Hindu family) is entitled to (a) object to sale of his/her share in the joint family property, and (b) get the sale made in favour of a third party purchaser declared void, such right of the minor is subject to (a) limitation provided under the Limitation Act, 1963 i.e., within three (3) years from the date of attaining majority[14], and (b) the minor proving that the alienation made by the Karta of the joint Hindu family was without any legal necessity and/or for benefit of the estate.

4.2     Notwithstanding the right of the minor as aforesaid, a purchaser of the joint family property can claim right to the joint family property acquired by him, if he is able to prove that (a) there was a legal necessity for alienation of the joint family property, and/or (b) the alienation of the joint family property was for the benefit of the estate. In case, the purchaser is not able to prove that (a) there was a legal necessity for alienation of the joint family property, and/or (b) the alienation of the joint family property was for the benefit of the estate, the purchaser can still succeed, if the purchaser is able to prove that he acquired the property (a) upon making reasonable and bona fide inquiry (as mandated by article 242 of the Hindu Law), and/or (b) taking all reasonable care and by acting in good faith (as mandated by Section 38 of the TP Act).

4.3     The purchaser can also claim himself to be a ‘bona fide purchaser’. While, the TP Act does not specifically define a ‘bona fide purchaser’, it has been held in various judicial pronouncements that a ‘bona fide purchaser’ is a person who purchases property (a) in good faith and with honest intention, after carrying out reasonable diligence, (b) for consideration or value, and (c) without notice of claims of a third party with respect to title to such property. The High Court of Calcutta in the case of Archit Banijya and Biniyog Private Limited Versus Asha Lata Ghosh[15] has observed that ‘The person who wishes to take advantage of the bona fide purchaser must show that he comes squarely under the doctrine. The plea of the bona fide purchaser is in the nature of an excuse............... It is the general doctrine that the person who alleges, and the person who shall succeed upon the proof of that allegation has the burden of proving that allegation. Since the bona fide purchaser for value without notice alleges so and proposes to take benefit from the establishment of such allegations, it is he who has to prove it, and to prove it he must to such satisfaction of the Court of equity, as clears the Courts conscience completely’.

The views and opinions expressed in this article belong solely to the author and do not reflect the position of Tatva Legal, Hyderabad.

[1]     For the purpose of this Article, we have discussed only the Mitakshara Law.

[2]     Article 218 of the Mulla, Principles of Hindu Law

[3]     Article 234 of the Mulla, Principles of Hindu Law

[4]     Article 240 of the Mulla, Principles of Hindu Law

[5]     Article 241A of the Mulla, Principles of Hindu Law

[6]     Article 241 of the Mulla, Principles of Hindu Law

[7]     Article 242 of the Mulla, Principles of Hindu Law

[8]     AIR 1957 AP 744

[9]     AIR 1966 Ker 266

[10]   AIR 1971 SC 776

[11]   [1983] 142 ITR 677(Gauhati)

[12]   AIR 1941 PC 43

[13]   AIR 1996 AP 5

[14]   Section 60 of the Limitation Act, 1956

[15]   MANU/WB/0523/2000