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Analysis Of A Hindu Woman's Right To Enter Family Settlements In Light Of Khushi Ram v/s Nawal Singh

Given the patriarchal structure of Indian society, the property rights of women have always been a contentious issue in our nation. With the enactment of Hindu Succession (Amendment) Act, 2005, the Indian Parliament officially declared men and women equal in terms of succession rights. However, since this wasn't always the case, a number of issues continue to arise with respect to women's right to property, as well as the nature of such right (whether it is absolute or partial).

The Supreme Court in the recent case of Khushi Ram v. Nawal Singh and Others, gave a landmark judgment in this respect, wherein the court made it clear that a Hindu woman can not only inherit her husband's property, but she has the absolute right to gift the property to her family from her father's side, or any other person who, as defined under Hindu Succession Act, can possibly inherit her property if she dies intestate. The abstract concept of family settlement is also dealt with wonderfully by the Bench consisting of Justice Ashok Bhushan and Justice Subhash Reddy.

Facts of the Case
The case originates in 1953, when a certain Sher Singh dies heirless, leaving behind his widow, Smt. Jagno, who inherited her husband's property in Village Garhi Bajidpur, District Gurgaon, Haryana. Sher Singh had a brother, Bali Ram. His descendants are the ones who have filed the present appeal in the Supreme Court. In 1991, Civil Suit no. 317 was filed in Court of Sub-Judge, Gurgaon.

The Suit was filed by Nawal Singh and Ors., who claimed a decree of declaration from the Court, which declared the plaintiffs (in Suit no. 317) as owners of the property that Smt. Jagno had inherited from her own husband, claiming that Smt. Jagno had settled the land in their favor in a family settlement.

These plaintiffs (in Suit no. 317) were sons of Smt.Jagno's own brother (i.e., her nephews). Smt. Jagno accepted the claims made in Suit no. 317, and consequently a decree was passed by the trial court that declared the Jagno's nephews as owners of her property in Garhi Bajidpur that she had inherited form her husband.

Civil Suit no. 79 was also filed the same year, by the descendants of Sher Singh's brother Bali Ram (those are the plaintiff-appellants in the present case) in the court of Sub-Judge of Gurgaon, praying to declare the Suit no. 317 as illegal and invalid, as well as to declare them (the descendants of Bali Ram) as the rightful owners of the land inherited by Smt. Jagno at Garhi Bajidpur. The defendants in the Suit no. 79 included Smt. Jagno (defendant no. 4) and her nephews (defendant no. 1 to 3), who submitted that Jagno had settled the land in their favor after entering into a family settlement with them, out of love and affection. The suit no. 317 was a mere reaffirmation of the said settlement.

In suit no. 79, the plaintiffs argued that the decree issued in suit no. 317 was invalid also because it was unregistered. The trial court however, said that only a decree that creates new right(s) has to be registered necessarily. Since, the given decree issued in Suit no. 317 was not creating new rights, but merely reaffirming existing rights of the defendants (those who are nephews of Smt. Jagno), it wasn't necessary to register the decree.

It was adjudged as such by the trial court because Smt. Jagno in her response to suit no. 317 acknowledged that she had settled the property in favor of her nephews already, in a family settlement, and hence they had a pre-existing right in the property. Since the decree needs to be registered only when the decree is creating a new right, the decree which was issued in the aftermath of Suit no. 317 wasn't required to be registered necessarily.

The first appeal was filed by the plaintiff-appellants of the present case in District Court which was dismissed too. The District Judge said that under Section 14(1) of the Hindu Succession Act, Smt.Jagno, as the widow, gained absolute ownership of her husband's share. Also, her nephews were her relatives and not strangers, and she had surrendered her right in her husband's property to her nephews out of love and affection. Thus, the District Judge reaffirmed what the Trial Court had said, previously.

After this, the plaintiffs (descendants of Smt.Jagno's deceased husband's brother Bali Ram) appealed in the High Court in 2002, whose judgment was pronounced by the High Court in 2009. In this judgment too, the High Court held the decree issued in the aftermath of Suit no. 317 to be perfectly valid, and stated that there was no requirement to get the decree registered under Section 17(1) of the Indian Succession Act, 1908, as the decree merely reaffirmed the existing rights of the defendants (i.e., nephews of Smt.Jagno), and didn't create any new rights. After this judgment of High Court dating 2009, the current appeal has been filed in front of the Supreme Court.

Issues:
After reading the submissions of the learned counsel for appellants, Shri Ranbir Singh Yadav, and the learned counsel for respondents, Shri Manoj Swarup, the Bench framed the following issues:
  1. Whether it was necessary to get the decree passed after suit no. 317 in 1991 registered under Section 17 of the Indian Registration Act, 1908?
  2. Whether defendants no. 1 to no. 3, (the nephews of Smt. Jagno) were strangers with whom Smt. Jagno couldn't enter a family settlement with? Or they weren't?

Judgment:
The Judgment was given by a division bench comprising of Justice Ashok Bhushan and Justice R. Subhash Reddy. The decision was unanimous and penned by Justice Bhushan.
  1. Judgment in Personam:
    The Bench held that the decree dating 19-08-1991, i.e., the one originating post Suit no. 317, was not registrable, since it didn't create a new right and merely reaffirmed the existing rights of the nephews of Smt. Jagno. Further, the property whose ownership was reaffirmed by the decree dating 19-08-1991 was also the subject matter of the civil suit no. 317, subsequent to which the said decree was issued.

    This meant that the decree didn't fell under Section 17(2)(vi) of the Indian Registration Act. Also, under Section 15 and Section 16 of the Hindu Succession Act, Smt. Jagno gained absolute ownership of her deceased husband's property, and as per the provisions of Section 15(1), her nephews too, can inherit the property, which means she could enter into a valid family settlement with them.
     
  2. Judgment in Rem:
    A decree, which deals with property, or reaffirms a pre-existing right in a property, where the said property is the subject-matter of the suit post which the consent decree was issued, is not registrable under Section 17 of the Indian Registration Act, as well as it's exempt from the exclusionary clause of Section 17(2)(vi) of the Indian Registration Act, 1908.

    Also, a widow can enter into a family settlement with her relatives from her own paternal side. A family settlement can be entered into by people who are all related to each other, and have a claim or even a semblance of claim on the property in question, for which the settlement has been entered into.

Reasoning:

The Bench makes it clear that there is no dispute regarding the fact that Sher Singh's property at Gardhi Bajipur is the subject matter of Civil Suit no. 317 dated 19-08-1991, post which the decree was issued which the plaintiff-appellants (the descendants of Sher Singh's brother Bali Ram) want to be declared illegal. The argument is that the decree was needed to be registered under Section 17(1) and Section 17(2)(iv) of the Indian Registration Act, as it was a decree that created right in favor of the defendants (nephews of Smt. Jagno).

For this the learned counsel for appellant relied on the case Bhoop Singh v. Ram Singh Major and Ors.1, wherein the Supreme Court had observed that it is the duty of the court to examine whether a new right is created in favor of one party by the other party that previously held the right over that property, or not. If a new right is indeed created, and the decree is not a mere reaffirmation of a pre-existing right, then it has to be registered under Section 17(1)(b) of the Indian Registration Act 1908.

In the said judgment, the Court also adjudged that a decree will be registrable compulsorily even if the property over which a new right is created is not a subject-matter of the suit. In the Bhoop Singh case however, the Court observed that the decree issued created a new right on the very day on which it was released, hence it was adjudged to be registrable under Section 17 of the Indian Registration Act, 1908.

Another case that was cited by the learned counsel for appellants was Mata Deen v. Madan Lal and Ors.2, wherein a decree was passed settling the property in favor of plaintiffs of that suit. However, the decree was unregistered and set aside, but this didn't help the argument put forth by learned counsel for appellant in the present case, since it wasn't clear in the Mata Deen case whether property which was settled through decree was actually the subject-matter of the Suit or not. This fact, the Bench said, was crucial in the light of Section 17(2)(iv).

The Bench then discusses the arguments put forth by the learned counsel for defendants, Shri Manoj Swarup, who relied on the case Som Dev and Ors. v. Rati Ram and Anr.3, wherein the Supreme Court adjudged that if the decree was based on a pre-existing right, then it wasn't necessary to get the decree registered under Section 17 of the Indian Registration Act.

The Bench then moved on to the case of K. Raghunandan and Ors. Vs. Ali Hussain Sabir and Ors.4, where Court has interpreted the Section 17 in detail. The court explicitly said If a compromise is entered into in respect of an immovable property, comprising other than that which was the subject-matter of the suit or the proceeding, the same would require registration. The said provision was inserted by Act 21 of 1929. The Court again cited its judgment in Bhoop Singh case to back its judgment in K. Raghunandan case as well.

Another case, Mohammade Yusuf & Ors. Vs. Rajkumar & Ors.5 is cited, this one judgment was actually given jointly by Justice Ashok Bhushan and one other judge of the Supreme Court only. Herein both the Bhoop Singh and the Som Dev cases were cited and discussed again.

The court interpreted Section 17 again, and observed that no decree or order of a court has to be registered compulsorily, except a decree of compromise that deals with immovable property other than what is the subject-matter of the suit.

In the Mohammad Yusuf case however, the decree passed in the suit (dated 4-10-1985), dealt with property which was the subject matter of the case, hence there was no need to get the decree registered, as Section 17(2)(vi) wasn't applicable.

The Bench concluded that the decree in suit no. 317, dated 19-08-1991 wasn't registrable as the property was indeed the subject-matter of the suit, and Smt. Jagno had reaffirmed a pre-existing right of her nephews, as the ownership of her deceased husband's property was already settled in favour of her nephews by herself. However, here was the next issue of the case, i.e., whether the settlement through which the right of her nephews in the property was created was itself a valid settlement or not.

The learned counsel for plaintiff-appellants argued that the nephews of Smt. Jagno belonged to a different family, hence there cannot be a family settlement between them and Smt. Jagno. The Court, relying upon the case of Ram Charan Das v. Girjanandini Devi and Ors.6, stated:
every party taking benefit under a family settlement must be related to one another in some way and have a possible claim to the property or a claim or even a semblance of a claim.

The court also made it clear, as per the case of Rangasami Gounden v. Nachiaopa Gounden, that it is not necessary for every party taking benefit from a family settlement to have a claim on the property in question, as per the rule of law. Instead, what's necessary is that all the parties to the settlement must be related to each other via some relation, and have a claim or even a semblance of a claim as per other grounds, such as love or affection.

The Bench cites another landmark judgment, of Kale and Ors. Vs. Deputy Director of Consolidation and Ors.7, wherein the judges discussed the concept of family in context of family 'settlement' in detail. The aim of such settlement is to ensure that no bad blood remains within the family relations, and also to ensure peace of mind for all.

The court cited Kerr Williamson's Kerr on Fraud 8, wherein the nature of family settlements and compromises made therein was distinguished from the nature of compromises made in a settlement between strangers. The objective of family settlements is to protect the members from long drawn-out litigation battles and to protect the unity and solidarity of the family members.

The unity of a family is necessary for building an egalitarian, strong society, and in turn a strong nation. For the sake of social justice, it is necessary that the wealth of a family is distributed equitably and isn't concentrated in the hands of a few. The term family has to be understood in a wider sense, too, and would include those relatives who have even a semblance of claim or those who may have some sort of antecedent title. Thus, courts are expected to make sure that family disputes, once settled with equitable distribution of property, aren't disturbed on technical grounds.

Halsbury's Laws of England 9 is cited next, for the same purpose, i.e., to explain the significance of family settlements. It also emphasizes on the need for reaching a settlement that is beneficial for the family as a whole and not to any single party.

The matter is reduced into the following prepositions, in order to make the settlement binding:
  1. The settlement must be a bona fide one, and aiming to settle the dispute with equitable distribution of properties amongst the family members
  2. There should not be any coercion, fraud or undue influence involved in the settlement.
  3. A document of settlement would be required to be registered only if it creates a new right in favour of a party.
  4. The parties to the settlement must have some claim, or even a possible claim in the property in question.
  5. Even if a party that participates in a settlements and benefits from it has no antecedent title to the property it so received, the court will acknowledge that there was indeed an antecedent title and accept the settlement as valid.
  6. Even disputes which don't involve a legal claim which are settled by family arrangements, such arrangement would be binding on the parties that participated in the arrangement.

The Bench further cited another paragraph from the Kale and Ors. case, wherein it made clear that the court will take a very liberal approach in case of a family settlement, to make sure that once a settlement has been reached, the dispute isn't revived on frivolous grounds. More importantly, the court points out that in the Kale case, the plaintiff entered into an agreement with his mother's two sisters, who weren't legal heirs as per the law (U.P. Tenancy Act, 1939 in this case). Still the family arrangement was upheld by the court as valid, given it was a bona fide settlement where property was distributed between Kale and his mother's sisters equitably.

The Court then further examine Section 15(1) of the Hindu Succession Act, 1956, which lists down upon the relatives who are possible heirs to a Hindu female's property. The list included the heirs of the Hindu female's father (which would include the Hindu female's brothers and the children of brothers) as well.

This point made it clear that nephews of a Hindu female can very well be possible heirs to her property, and in the present case too it would be so. Thus, being absolute owner of her husband's property, Smt. Jagno could legally grant the ownership of said property in favour of her brother's sons. Thus, the Bench concluded that the settlement that Smt. Jagno has entered into prior to the issuing of the decree dated 19-08-1991 was perfectly valid.

Critical Analysis
The judgment deals with one of the most significant issues with respect of property rights of women in India. Section 15 of the Hindu Succession Act, 1956 was a remarkable and radically progressive provision that specified who can inherit the property of a Hindu woman if she dies intestate.

The preference is as follows:
  1. It shall be inherited by her children (both sons and daughters) and her husband and even her grand children if the parents of those grand-children are pre-deceased.
  2. The next in line are the heirs of her husband, i.e., the siblings of husband and the children of those siblings.
  3. Next are the parents of the woman.
  4. Followed by the heirs of father (in the present case too, it's the heirs of the father as they are the sons of Smt. Jagno's brother)
  5. Finally, the heirs of mother, i.e., maternal side relatives of the woman whose property is to be dissolved.

In the present case Smt. Jagno had entered into a family settlement with her nephews who are 4th on the preference hierarchy of dissolution of a Hindu woman's estate. Smt. Jagno was alive when her property was transferred to her nephews, and so the provision in Section 15 wouldn't be directly applicable.

However, the Court, while explaining the unique nature of family settlements and how they are different from normal settlements (between strangers or non-family members), made it clear that said settlements can be entered into with those people who have even a semblance of claim on the property in question.

Herein, there was definitely a possible claim on the part of defendants (nephews of Smt.Jagno) over Jagno's property that she had inherited. Even though they are somewhat down the preference hierarchy as described in Section 15, it is clear that they had a semblance of claim over the property in question.

Thus, Jagno entering into a family settlement with them and relinquishing her own right over that property in favour of her nephews was also perfectly valid. The Bench also made it clear that Jagno has absolute (and not limited) right over her deceased husband's property, hence she was perfectly eligible of transferring the ownership of the said property to her nephews via a family settlement. This was a remarkable point which was technically reinforced by this judgment.

The concept of family settlement was also discussed in detail. It is also remarkable how even though the legal philosophers cited by the Bench are Europeans, there ideas are incredibly relevant in the Indian context too. It can be said that in every society where family constitutes the most basic group of human interaction, these principles are significant. Halsbury's Laws of England makes it clear that a family arrangement's aim is to ensure that a property that is the cause of dispute is compromised in a way that benefits all members, or its aim is to make sure that the family members don't remain stuck in litigation or legal conflict, and instead are able to achieve peace and prosperity and protect the honour of the family 10. The Bench also specifies that such an arrangement can also be entered into by only those people who are related to each other. That means, every person entering the settlement has to be related to every other person.

Here the Bench specified however that it is not necessary that only those relatives who have a direct legal claim on the property in question can enter into such agreement. Given that the purpose of a family settlement is to ensure peace and prosperity of the said family, it is only logical to allow women members as well to surrender the ownership of her property in favour of the relatives from her own family, i.e., her parents and their heirs.

Family settlements have to be considered as a means of ensuring peace for the entire families, and herein they differ from normal settlements between strangers. In a settlement between strangers, the issue can be reopened and legal conflict can be dragged on without much impact on the society as a whole.

In case of family settlements however, the longer the legal conflict continues, the more damage it would do to the social fabric, and indirectly to the national community, the Bench cited Halsbury while making its point, although it can be considered as a bit exaggerated, the main point was still made clear, i.e., the family is an important organization that needs to be kept out of conflict as much as possible for the relative stability of the society.

The Court also gave (or rather we can say, reiterated) the rules regarding registration of orders and decree issued by courts. The Indian Registration Act, 1908, was enacted for the purpose of conserving titles and evidence. The legislation regulates the registering of documents for the same purpose. Specifically, Section 17 of the Act was discussed in this case.

The section lists down the documents that have to be compulsorily registered if the properties which these documents relate to is in a district in which the legislation came into force. These documents included non-testamentary document that seek to create a right in an immovable property of more than INR 100 in value. This is mentioned, along with other such documents that have to be necessarily registered under the said section 11.

Such documents include:
  1. Instruments that relate to transfer of immovable properties as gifts.
  2. Non-testamentary instruments that create a new title or right to an immovable property worth more than INR 100.
  3. Non-testamentary instruments which acknowledge the consideration paid in exchange of creation of a right or title to immovable property
  4. Lease of immovable property from year to year.
  5. Non-testamentary instruments which transfer or assign any decree or order of a court which performs the action that is mentioned in point no. 2

There is a proviso that exempts any leases whose terms don't exceed five years and the annual rent describes in which doesn't exceeds INR 50, from the provisions of Section 17 sub-section 1 of this act.

In the given case, the counsel for appellant argued that by the decree dated 19-08-1991, the right to the property that Smt. Jagno inherited from her husband was created in favour of Jagno's nephews. To back this, appellant counsel tried to argue that the family settlement that Jagno and her nephews had entered into previously was invalid, hence no right was created until the decree in Civil suit no. 317 was issued by court. Since this decree was creating a new right, it was required to be registered necessarily. The bench of course made it clear that the family settlement was valid (as explained earlier) and no new right was created. Hence, there was no requirement to get the decree registered.

Conclusively, the court gave a landmark judgment where it made clear its approach towards solving family related disputes, and its commitment to ensure peace and prosperity of the family structure, and indirectly, that of the whole society. The technicalities relating to registration of court decree has been addressed as well, although this was more of a reiteration of the previous judgments regarding this issue.

End-Notes:
  1. Bhoop Singh Vs. Ram Singh Major and Ors., (1995) 5 SCC 709
  2. Civil Appeal No.890 of 2008 Mata Deen Vs. Madan Lal & Ors.
  3. Som Dev and Ors. Vs. Rati Ram and Anr., (2006) 10 SCC 788
  4. K. Raghunandan and Ors. Vs. Ali Hussain Sabir and Ors., (2008) 13 SCC 102
  5. Mohammade Yusuf & Ors. Vs. Rajkumar & Ors., 2020(3) SCALE 146
  6. Ram Charan Das Vs. Girjanandini Devi and Ors., 1965 (3) SCR 841
  7. Kale and Ors. Vs. Deputy Director of Consolidation and Ors., (1976) 3 SCC 1
  8. Kerr on Fraud at p. 364
  9. Halsbury's Laws of England
  10. The Entire Law Relating To Family Settlements Explained Articles (itatonline.org)
  11. Sec 17 of Indian Registration Act, 1908

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