This article examines a significant judgment by the Supreme Court of India concerning the rights of co-owners in undivided property and the limitations on unilateral transfers without proper partition. The ruling underscores the importance of proving family settlements and relinquishment deeds, and reinforces the principle that a co-owner can only transfer their un-demarcated share, not the entire property.
1. Factual Background and Procedural History
The dispute revolves around a property measuring approximately 6 Cottahs, 1 Chittack, and 30 sq. ft., along with 17 rooms, located at 100/3 Carry Road, Howrah. This property was jointly purchased in 1959 by two brothers, late Sita Ram and late Salik Ram, who held equal rights in it.
The plaintiff-respondent, Nandu Lal Shaw, is the son of late Salik Ram. He alleged that his father never gifted his share to late Sita Ram, and no family settlement occurred to transfer the entire property to Brij Mohan, son of late Sita Ram. Therefore, Nandu Lal contended that Brij Mohan had no exclusive right to sell the entire property.
Conversely, the defendant-appellant, S.K. Golam Lalchand, and Brij Mohan asserted that late Salik Ram had gifted his share to late Sita Ram around 1960, making Sita Ram the absolute owner. Upon Sita Ram’s death in 1975, the property devolved upon Brij Mohan and his three sisters, who allegedly relinquished their rights in Brij Mohan’s favour, thus making him the absolute owner. Based on this premise, Brij Mohan executed a registered sale deed dated May 19, 2006, transferring the entire suit property to S.K. Golam Lalchand.
In response to this sale, Nandu Lal Shaw filed Title Suit No. 212/2006 for declaration and permanent injunction. He sought a declaration that S.K. Golam Lalchand had not acquired any right, title, or interest in the property through the sale deed executed by Brij Mohan, and a permanent injunction restraining S.K. Golam Lalchand from dispossessing other tenants or causing disturbance to Nandu Lal’s possession.
The Court of first instance initially dismissed Nandu Lal’s suit, reportedly because he failed to prove his possession. However, in the first appeal, the decree was reversed, and the suit was decreed. The First Appellate Court disbelieved the alleged family settlement and concluded that the property remained unpartitioned. This judgment and order of the First Appellate Court were subsequently affirmed by the High Court in Second Appeal.
Aggrieved by the High Court’s affirmation, the defendant-appellant, S.K. Golam Lalchand, preferred the present appeal before the Supreme Court of India.
2. Identification of Legal Issues
The central legal question identified by the Supreme Court for determination was:
- Competence of Unilateral Transfer: Whether Brij Mohan, as a co-owner, was competent to transfer the entire suit property by way of a sale deed dated May 19, 2006, in favour of defendant-appellant S.K. Golam Lalchand.
3. Arguments of the Parties
Arguments on Behalf of the Appellant(s) (S.K. Golam Lalchand and Brij Mohan):
The appellants contended that late Salik Ram had gifted his share in the property to late Sita Ram, making Sita Ram the sole owner. Subsequently, upon Sita Ram’s death, his daughters allegedly relinquished their rights in favour of Brij Mohan, making him the absolute owner of the entire property. Therefore, Brij Mohan was competent to execute the sale deed dated May 19, 2006, transferring the whole property to S.K. Golam Lalchand, who claimed to be a bona fide purchaser in good faith. They argued that their stance was supported by the recital in the sale deed indicating how Brij Mohan acquired the property.
A subsidiary argument was that the plaintiff-respondent, Nandu Lal Shaw, had not sought the relief of cancellation of the sale deed executed in favour of S.K. Golam Lalchand and, therefore, was not entitled to any relief in the suit.
Arguments on Behalf of the Respondent(s) (Nandu Lal Shaw):
The respondent, Nandu Lal Shaw, maintained that his father, late Salik Ram, never gifted his share to late Sita Ram, and there was no family settlement settling the property exclusively in favour of Brij Mohan. He asserted that the property remained unpartitioned, and thus, Brij Mohan, as a mere co-owner, had no right to transfer the entirety of it. The original purchase deed of 1959 clearly showed joint ownership by late Salik Ram and late Sita Ram, a position admitted by all parties. Therefore, the sale deed dated May 19, 2006, executed by Brij Mohan for the whole property was void.
Regarding the appellant’s contention about not seeking cancellation of the sale deed, the respondent argued that Section 31 of the Specific Relief Act, 1963, uses the word ‘may’ for declaring an instrument void, making it not imperative in every case, especially when the person is not a party to such an instrument.
4. Court’s Analysis and Reasoning
The Supreme Court meticulously examined the evidence and findings of the lower courts to address the central issue.
- Proof of Gift/Relinquishment/Family Settlement: The Court noted that despite the appellants’ assertions, neither S.K. Golam Lalchand nor Brij Mohan had presented any evidence to prove the alleged gifting of Salik Ram’s share to Sita Ram. No gift deed was produced. Consequently, the Court found that both brothers, Salik Ram and Sita Ram, continued to be joint owners of the property. Similarly, no evidence was adduced to establish that Sita Ram’s three daughters had relinquished or gifted their rights in the property to their brother, Brij Mohan. The claim of family settlement, which would have conferred exclusive rights on Brij Mohan, also remained unproven, as no such settlement was adduced in evidence. The Court found that all three lower courts (Trial Court, First Appellate Court, and High Court) had consistently disbelieved the story of family settlement as set up by the appellants.
- Undivided Joint Property: The Court affirmed the consistent findings of the Trial Court and the First Appellate Court that the suit property was never partitioned and remained undivided and joint between the co-owners. Since the gifting of Salik Ram’s share and the relinquishment by Brij Mohan’s sisters were not proven, the entire property continued to be the joint property of late Salik Ram and late Sita Ram, in which both had equal rights.
- Competence of Brij Mohan to Transfer: Based on the property’s status as undivided joint property, the Court concluded that Brij Mohan alone was not competent to execute a sale deed for the entire property in favour of S.K. Golam Lalchand, especially without its partition by metes and bounds.
- Effect of Sale Deed under Transfer of Property Act: The Court clarified that the sale deed dated May 19, 2006, executed by Brij Mohan, could only be valid to the extent of Brij Mohan’s own share in the property, in accordance with Section 44 of the Transfer of Property Act, 1882. S.K. Golam Lalchand was left with the option to claim appropriate relief, such as filing a suit for partition or seeking compensation/damages against Brij Mohan. The Court acknowledged that while there was no illegality in purchasing Brij Mohan’s share, this did not justify reversing the decree passed by the First Appellate Court and affirmed by the High Court.
- Absence of Cancellation Relief: Addressing the argument that the plaintiff did not seek cancellation of the sale deed, the Court rejected this contention. It reasoned that Section 31 of the Specific Relief Act, 1963, uses the word ‘may’ for declaring an instrument void, indicating that it is not imperative in every case, particularly when the person seeking relief (Nandu Lal) was not a party to the impugned instrument.
- Injunction Against Derogation of Co-owner Rights: The Court upheld the injunction granted against S.K. Golam Lalchand, restraining him from acting in derogation of the proprietary rights of the co-owners until a partition takes place. The Court emphasized that the undivided property remained with the co-owners, who must proceed according to law to determine and demarcate their shares before making a transfer.
5. Final Conclusion and Holding
The Supreme Court found no merit in the appeal and accordingly dismissed it, upholding the judgments and orders of the High Court dated July 6, 2021, and the First Appellate Court dated April 7, 2018.
The ultimate decision and legal principles laid down are:
- A co-owner cannot unilaterally transfer the entire undivided joint property without its partition by metes and bounds.
- Any such transfer by a co-owner is valid only to the extent of their share in the property, as per Section 44 of the Transfer of Property Act, 1882.
- Claims of gift, relinquishment, or family settlement must be duly proven with cogent evidence; mere allegations are insufficient.
- The absence of a specific prayer for cancellation of an instrument is not fatal to a suit if the plaintiff was not a party to that instrument, as Section 31 of the Specific Relief Act uses “may”.
- Co-owners of undivided property retain their rights, and purchasers of a share from one co-owner cannot act in derogation of other co-owners’ rights until a proper partition occurs.
FAQs:
1. Can a co-owner sell an entire property without others’ consent?
No, a co-owner generally cannot sell the entire undivided property without the consent or legal partition involving all other co-owners; they can only transfer their own undivided share.
2. What happens if one co-owner sells the whole jointly owned property?
If one co-owner sells the entire jointly owned property, the sale is typically valid only to the extent of that co-owner’s specific share, as per Section 44 of the Transfer of Property Act, leaving the buyer with remedies like seeking partition.
3. Is a gift deed necessary to prove the transfer of a share in property?
Yes, to prove the transfer of a property share, especially in a family context, a formal gift deed or other legally recognized documentary evidence is usually necessary; mere allegations are insufficient.
4. Do I need to file a separate suit to cancel a void property sale deed?
Not necessarily. If you were not a party to a void property sale deed, you may not be required to specifically seek its cancellation in your suit, as per the interpretation of Section 31 of the Specific Relief Act.
5. What rights does a buyer acquire when purchasing a share in an undivided property?
When buying a share in an undivided property, the buyer generally acquires the rights of the selling co-owner, but they cannot claim exclusive possession of any part of the property until a formal partition takes place.
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