Whether Property Obtained in Partition is Joint or Separate Property?Read Here

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July 04, 2018

Case name: Shyam Narayan Prasad v. Krishna Prasad & ors.

Date of Judgment: July 02, 2018

In this recent case, the following issues pertaining to coparcenary property fell for consideration before the Supreme Court:

  1. Whether the property allotted in partition retained the character of a coparcenary property?
  2. Whether an unregistered exchange deed is admissible in evidence or not?
  3. When can defendant avail benefit of part performance under Section 53A of Transfer of Property Act?

With reference to the first issue, the Supreme Court held that the property inherited by a male Hindu from his father, father’s father or father’s father’s father is an ancestral property. The essential feature of ancestral property, according to Mitakshara Law, is that the sons, grandsons, and great grandsons of the person who inherits it, acquire an interest and the rights attached to such property at the moment of their birth.

That the share which a coparcener obtains on partition of ancestral property is ancestral property as regards his male issue. After partition, the property in the hands of the son will continue to be the ancestral property and the natural or adopted son of that son will take interest in it and is entitled to it by survivorship.

The Apex Court also referred to the case of C. Krishna Prasad v. C.I.T, Bangalore[1], wherein it was held that the share which a coparcener obtains on partition of ancestral property is ancestral property as regards his male issue. They take an interest in it by birth, whether they are in existence at the time of partition or are born subsequently. Such share, however, is ancestral property only as regards his male issue.

That property in the hands of a sole coparcener allotted to him in partition shall be his separate property for the same shall revive only when a son is born to him[2].

Admissibility of unregistered Exchange Deed– With reference to the second issue the Supreme Court stated that the mode of transfer in case of exchange is the same as in the case of sale. Thus, in the case of exchange of property of value of Rs. 100/- and above, it can be made only by a registered instrument as mandated under Section 17(i) (b) of the Registration Act.

“Exchange” is defined under TP Act and states that when two persons mutually transfer the ownership of one thing for the ownership of another, neither thing or both things being money only, the transaction is called an “exchange”.

Section 17(i) (b) of the Registration Act mandates that any document which has the effect of creating and taking away the rights in respect of an immovable property must be registered and Section 49 of the Registration Act  imposes bar on the admissibility of an unregistered document and deals with the documents that are required to be registered under Section 17 of the Registration Act.

The Supreme Court held that since the deed of exchange has the effect of creating and taking away the rights in respect of an immovable property, it requires registration under Section 17.

Application of Section 53A of the T.P Act- The object of Section 53A of Transfer of Property Act is to protect the prospective transferees by allowing them to retain the possession over the property, against the rights of the transferors, who after the execution of an incomplete instrument of transfer, fails to complete it in the manner specified by law.

In this context, it was held by the Supreme Court that the defendant who intends to avail the benefit of Section 53A must plead that he has taken possession of the property in part performance of the contract.

That no relief can be granted to a party without the pleadings. Therefore, it is not open for the first defendant/appellant to claim the benefit available under Section 53A of Transfer of Property Act.

The entire case can be accessed here.

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[1] 1975 (1) SCC 160

[2] M. Yogendra and Ors. v. Leelamma N. and Ors. 2009 (15) SCC 184