Numerous depictions of family disputes over the property in movies and novels have proven only one point: since the beginning of time, the property has been a symbol of high economic status, and it has been a source of contention among kin. Property disputes between families are common in India these days. Legal property disputes occur at various levels of society, whether among low-income or wealthy families, and most of these disputes concern ancestral property. Things that could be resolved amicably through mutual understanding are dragged to the courts, destroying their cordial ties, and creating discord between the members. This article discusses distinct types of property and settlement processes, as well as some relevant case laws.
Property Disputes among Blood Relatives
Indian families, especially joint families, frequently experience property disputes. Since the ancestral property is divided among the legal heirs, issues arise when one family member wants to partition while the other family member objects to their plan. It is now an inherent part of every family conflict. Most people are unaware that the legal process for family disputes involves protracted court battles, is extremely time-consuming, expensive, and does not even ensure sufficient or adequate results. Even the Indian judicial system cannot guarantee that the current generation or future generations will receive the desired outcomes, whether favorable or unfavorable. There are numerous partition suits pending before our courts that have yet to be resolved. As a result, such a lengthy, exhausting, and complex procedure discourages families from entering this judicial arena.
Types of Property
Property is of two types, Ancestral or Self-Acquired Property
Ancestral properties are joint family property or property that has been in the family for generations and becomes part of the inheritance of all family members or members who have legal rights to the inherited property. In other words, property passed down from grandfathers or great grandfathers becomes inherited.
Self-acquired property is defined as property earned or created by the person himself. Self-acquired property is only inherited through a will by the person whose property it is to the person to whom he/she wishes to give it. No one has the right to self-acquired property. However, it becomes ancestral if the owner dies without leaving a will.
Family disputes are more common when there is joint family property. The following factors can have an impact on joint family property division:
- Amicable Settlement
- Forced Settlement – Through Arbitration/Court
Family settlement can be done amicably. The members agree upon the terms and conditions of their share through negotiation and settlement. The family contract may be written or verbal. The family arrangement can be reduced in writing and need not be registered if it is simply a record of what has been agreed upon. The document is registered, though, if it’s going to be used as settlement evidence. When the division is agreed upon by both parties, a partition deed may be put into effect. The share of each co-owner is expressly stated in the partition deed. Stamp duty has been paid and the deed has been registered.
Filing a partition suit -If there is a dispute and no amicable solution exists, a partition suit is filed, and a settlement is reached through the court’s intervention. The court may divide the property physically or distribute the sale proceeds. Court proceedings are time-consuming and, at times, resource-intensive. It is preferable to settle disputes amicably rather than in court. The share of each co-owner is determined, either by mutual agreement or by the court appointing a local commissioner to determine the respective shares.
Partition by arbitration: Each joint family member appoints an arbitrator to determine their share and divide the property accordingly.
Memorandum of Family Settlement
A Memorandum of Family Settlements is a written document that states the arrangement between family members and serves as a record of the mutual agreement regarding the terms of property division. It is done for mutual benefit and to avoid time-consuming litigation that leads to bad blood and conflict among family members. With this Memorandum of Family Settlements, one can avoid the difficulties and shortcomings of lengthy, time-consuming legal procedures. This is the most effective tool for peacefully resolving family conflicts. Some people mix this up with the Partition Deed. There is, however, a distinction between the two. The MOFS records the previously agreed-upon terms and conditions for the property, whereas partition deeds only state the rights and titles to the property, which are eventually required to be registered. If the MOFS changes any of the property’s rights and titles, the registration becomes mandatory.
Partition in the Case of HUF
Hindus believe in the idea of an undivided family, in which every member is a direct descendant of a single ancestor. Everyone has an equal stake in the property. To benefit from tax advantages, people apply for HUF status. In the case of HUF, unless the contrary is proven, it is presumed that HUF assets are joint property. Only members with a maximum of four generations, known as coparceners, are eligible to request partition. Both married and unmarried daughters may be coparceners. All assets are split equally among all the members during the partition process.
Common Misconceptions about Property Division
- The first misconception that people have is that there can be a Will in the case of Ancestral Property, which is false. In the case of Ancestral Property, a person has a vested interest in it, which means that he acquired the right to the property through his birth in that family. This type of property is divided according to the laws of that religion. In such cases, a Will cannot be made; however, a Will can be made in the case of Self-Acquired Property.
- The second common misconception is that once the property is transferred to the nominee, he becomes the owner. This, however, is not the case. A nominee is only the property’s trustee. He must complete the tasks that the nominator was unable to complete. He has only been appointed to do the work on behalf of the nominator, who has since died.
- The Bombay High Court stated in the case Khunni Lal vs Kunwar Gobind Krishna Narayan (1911), that if the family relinquishes all claims in property disputes to appear as if they have concluded a settlement between the family members, the court will deem it to be a family settlement and the courts must uphold such arrangements.
- In the case of S. Shanmugan Pillai vs. K. Shanmugan Pillai (1972), the Supreme Court favored family arrangements that promote harmony through an amicable resolution of any property dispute between close relatives. Furthermore, the court will be hesitant to disrupt any peaceful settlement that may emerge as a result of the parties’ mutual agreement.
- In the case of Tek Bahadur Bhujil vs Devi Singh Bhujil (1965), the Supreme Court validated oral family arrangements and held that registration is required if the arrangements are in writing.
As a result, it is concluded that property disputes in families are unfortunately very common, particularly in India, and can have disastrous consequences. To avoid this type of situation, the easy and peaceful method of property settlement is mutually agreeing on the division of property, but the agreement must be performed in good faith and with free consent. If the settlement does not resolve the dispute, the parties must file a partition suit for their rights in the property, where the court will decide the share between the family members.
- Khunni Lal & Ors. vs Kunwar Gobind Krishna Narayan & Anr, 1911 (13) BOMLR 427
- S. Shanmugan Pillai & Ors. vs K. Shanmugan Pillai & Ors. 1972 AIR 2069
- Tek Bahadur Bhujil vs Debi Singh Bhujil And Ors AIR 1966 SC 292
- See Bhupender Tanwar, What are the main reasons for disputes in a family, lawtendo.com, (Apr 23, 2021) https://www.lawtendo.com/blogs/what-are-the-main-reasons-for-disputes-in-a-family (Last visited Sept.28, 2022)
- See Prachi Darji, Property Partition Laws in India, myadvo.in (Sept 19, 2019) https://www.myadvo.in/blog/family-partition-a-legal-perspective/ (Last visited Sept.28, 2022)
- See Tulna Rampal, Property disputes and memorandum of settlement in India with a view on family disputes, blog.ipleaders.in (June 9, 2022) https://blog.ipleaders.in/property-disputes-and-memorandum-of-settlement-india-with-a-view-on-family-disputes/ (Last visited Sept. 28, 2022)
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