Partition Can Also Be Achieved Through a Settlement or Verbal Agreement: Reiterates Supreme Court
The Supreme Court has made a significant observation in the matter of H. Vasanthi v. A Santha, stating that it is not compulsory that partition should be effected exclusively through a written instrument in strict accordance with the requirements of law.
In the specific case at hand, the plaintiff’s contention centered around the ancestral property, tracking it back to plaintiff’s grandfather. According to the plaintiff, the said property was purchased through a registered sale deed. Her grandfather’s son, the first defendant, inherited the said property as Joint Hindu Family Property, thereby passing it down to his son, the second defendant and the plaintiff herself (First defendant’s daughter). An agreement of sale between the first and second defendant and a third party was executed.
A partial partition was undertaken on February 24, 1980 which involved the plaintiff, first and second defendants and other siblings. The Hindu Succession Act’s amendment (Section 29A) on March 25, 1989 conferred coparcener status and partition rights to unmarried daughters. Although the plaintiff got married on July 7, 1989, she subsequently initiated legal proceedings seeking partition of the property. Simultaneously, she prayed for partition, asserting that the rights and entitlements of the plaintiff could not have been transferred by the first and second defendants, thus forming the basis for her partition suit.
The central issue presented before the Court pertained to whether the property outlined in the plaint schedule exhibited the characteristics of a coparcenary status as of March 25, 1989 and if it is available for partition.
Earlier, the suit was dismissed by trial Court and subsequently the dismissal was upheld by the Madras High Court on the grounds that the subject property was ineligible for partition as of the date of coming into force of Section 29A.
The Court, in its judgement, dismissed the plaintiff’s claim on the grounds that the plaintiff failed to substantiate the continuous coparcenary status of the property indicated in the plaint schedule. The mere acquisition of the coparcenary status by the Plaintiff cannot warrant a partition in her favour unless the plaintiff establishes that the partial partition did not affect the coparcenary rights.
Furthermore, the court observed that there is no prohibition in effecting a partition through means other than a written instrument by duly complying with the requirements of law. In essence, the division of coparcenary property could also be executed through a settlement or oral agreement.
Though Agreement To Sell does not confer Title, Possessory Right of prospective purchaser protected under Sec 53A Transfer of Property Act : Observes Supreme Court
The Hon’ble Supreme Court in the matter Ghanshyam v Yogendra Rathi has held that even though an Agreement to Sell does not transfer proprietary rights in an immovable property, however, when the prospective purchaser performs his part of the contract and receives possession of the property, then he/she is said to have acquired possessory title and the same is protectable under Section 53A of the Transfer of Property Act, 1882 (TPA).
In this matter, Mr. Ghanshyam (“Appellant”) was the owner of a property situated in Delhi (“Suit Property”). He entered into an Agreement to Sell dated 10.04.2002 with Mr. Yogendra Rathi (“Respondent”) for sale of Suit Property and received the entire sale consideration from the Respondent. On the same day, the Appellant executed a will bequeathing the Suit Property to the Respondent. The Appellant further executed a General Power of Attorney in favour of the Respondent. The possession of the Suit Property was handed over to the Respondent, however, no sale deed was executed.
The Respondent permitted the Appellant to occupy a portion of the Suit Property for 3 months as a licensee. After expiry of 3 months period, the Appellant did not vacate the Property. The Respondent filed a suit against the Appellant seeking the latter’s eviction from the Suit Property and recovery of mesne profits.
The Respondent claimed his ownership on the Suit Property on the strength of the Agreement to Sell dated 10.04.2002, General Power of Attorney, memo of possession, receipt of payment of sale consideration and a will dated 10.04.2002.
The Appellant argued that the documents cited by the Respondent have been manipulated on blank papers. However, there was no evidence to that effect. The Appellant did not dispute the execution of such documents or receipt of sale consideration by him.
The Trial Court held that there was no manipulation of documents and thus the Respondent is entitled to decree for eviction and recovery of mesne profits.
The Appellant filed a first appeal and thereafter a second appeal before the High Court and both were decided in favour of the Respondent. Subsequently, the Appellant filed an appeal before the Supreme Court.
The Bench noted that an Agreement to Sell is neither a document of title nor a deed of transfer of property by sale. Therefore, it does not confer any absolute title upon the Respondent over the Suit Property, in view of Section 54 of the Transfer of Property Act, 1882. However, the factors such as entering into an Agreement to Sell, payment of entire sale consideration and being put in possession by the transferor, shows that the Respondent has de-facto possessory rights based on his part performance of the Agreement to Sell.
Further, the Appellant’s entry into the Suit Property subsequently was as a licensee of the Respondent and not as the owner of Property.
The Bench opined that ordinarily an Agreement to Sell does not transfer proprietary rights in an immovable property. Nonetheless, when the prospective purchaser performs his part of the contract and receives possession of the property, then he/she is said to have acquired possessory title and the same is protectable under Section 53A of the TPA. The Bench held as under:
“Legally an agreement to sell may not be regarded as a transaction of sale or a document transferring the proprietary rights in an immovable property but the prospective purchaser having performed his part of the contract and lawfully in possession acquires possessory title which is liable to be protected in view of Section 53A of the Transfer of Property Act, 1882. The said possessory rights of the prospective purchaser cannot be invaded by the transferer or any person claiming under him.”
The Bench held that the possessory right of the Respondent is not liable to be disturbed by the transferer (Appellant). Accordingly, the Bench upheld the High Court’s view that the Respondent is entitled to a decree for eviction with mesne profits.