A Karta of a joint Hindu family has legal authority to execute an agreement to sell, and even to alienate, joint Hindu family property, and the absence of signatures of other coparceners is inconsequential; an alienation for value made by the Karta for legal necessity or for the benefit of the estate binds all undivided members, including minors and widows (Sri Narayan Bal and Others v. Sridhar Sutar and Others). Legal necessity is a question of fact and the Karta enjoys wide discretion; a stated need for funds to meet domestic necessities and to clear an existing mortgage over the suit property satisfies the requirement, and once legal necessity is proved no coparcener may challenge the sale (Kehar Singh (D) through Legal Representatives and Others v. Nachittar Kaur and Others). Pemmada Prabhakar and Others v. Youngmen’s Vysya Association and Others is inapplicable as it concerned intestate property inherited by class I heirs under Section 8 of the Hindu Succession Act and not joint Hindu family property. Omission to frame an issue on the Karta’s authority or legal necessity does not vitiate the trial where the parties went to trial knowing the rival case and led evidence (Kannan (Dead) by LRs. and Others v. V.S. Pandurangam (Dead) by LRs. and Others; Nedunuri Kameswaramma v. Sampati Subba Rao).
Karta can execute agreement to sell joint Hindu family property without signatures of other coparceners; alienation binds the family if made for legal necessity or benefit of the estate.
[Cites 11 , Cited by 0 ]
Supreme Court of India
Beereddy Dasaratharami Reddy vs V. Manjunath on 13 December, 2021
Author: Sanjiv Khanna
Bench: Sanjiv Khanna , M.R. Shah
NON-REPORTABLE
2021 INSC 880
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 7037 OF 2021
(ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO. 13853 OF 2021)
BEEREDDY DASARATHARAMI REDDY ..... APPELLANT(S)
VERSUS
V. MANJUNATH AND ANOTHER ..... RESPONDENT(S)
JUDGMENT
SANJIV KHANNA, J.
The legal issue which arises for consideration in the present
appeal is whether K. Veluswamy, as a Karta, has legal authority to
execute agreement to sell dated 8 th December 2006 for sale of the
suit land, being agricultural land – (i) Sy.No. 7/1P1, measuring 4
acres, 21 guntas of land; (ii) Sy.No. 7/1P2 measuring 5 acres of
land; and (iii) Sy.No. 8/3P3 measuring 2 acres of land, in all 11
acres 21 guntas of wet land, situated in Bagganadu Kaval Village,
J.G. Hally Hobli, Hiriyur Taluk, Chitradurga District, Karnataka.
Civil Appeal No. 7037 of 2021 Page 1 of 11
2. It is an accepted position that on 8 th December 2006, K.
Veluswamy as a Karta of the joint Hindu family had executed the
agreement to sell of the suit property for Rs.29 lakhs and had
received Rs.4 lakhs in advance from Beereddy Dasaratharami
Reddy, the appellant before us. K. Veluswamy, the second
respondent before us, has not entered appearance and contested
this appeal. The appeal is contested by the first respondent before
us, namely V. Manjunath, who is the son of K. Veluswamy. (For
convenience, K. Veluswamy and V. Manjunath, wherever required
have been collectively referred to the respondents).
3. On 26th November 2007, Beereddy Dasaratharmi Reddy instituted
the suit for specific performance of the agreement to sell
impleading both K. Veluswamy and V. Manjunath. The Court of
Senior Civil Judge, Hiriyur decreed the suit vide judgment dated
22nd January 2013 rejecting the defence that the agreement was a
camouflage for a loan agreement as K. Veluswamy was in need of
money for construction of a farm house. K. Veluswamy as the
Karta of the joint Hindu family property was entitled to execute the
agreement to sell, which agreement being on account of legal
necessity is valid.
Civil Appeal No. 7037 of 2021 Page 2 of 11
4. K. Veluswamy accepted the decision. His son V. Manjunath
preferred the regular first appeal before the High Court of
Karnataka at Bengaluru and vide the judgment under challenge
dated 6th March 2021 he has succeeded. The impugned judgment,
while accepting that K. Veluswamy did execute the agreement to
sell for the suit property for Rs.29 lakhs and had received Rs.4
lakhs as advance, held that the agreement to sell is un-
enforceable as the suit property belongs to the joint Hindu family
consisting of three persons, K. Veluswamy, his wife V.
Manimegala and his son V. Manjunath and, therefore, could not
have been executed without the signatures of V. Manjunath.
Relying on Pemmada Prabhakar and Others v. Youngmen’s
Vysya Association and Others,1 it was held that legal necessity
is not proved. Execution of the agreement to sell by K. Veluswamy
as a Karta of the joint Hindu family is held not established as no
issue on the aspect of authority of the Karta to execute agreement
to sell and legal necessity was framed. Consequently, it was held
that the suit must be dismissed.
5. The agreement to sell, which is an admitted document and
marked Exhibit P-1, it is accepted, was signed and executed by K.
Veluswamy and his wife V. Manimegala. P.B. Basavarajaiah,
Civil Appeal No. 7037 of 2021 Page 3 of 11
father-in-law of V. Veluswamy, had also signed the agreement to
sell. Payment of Rs. 4 lacs by Beereddy Dasaratharmi Reddy and
receipt of the said amount by K. Veluswamy as advance is also
not disputed. Remaining amount of Rs.25 lakhs was to be paid
within three months and the sale deed executed and registered.
The agreement to sell states that the subject property is a joint
Hindu family property, enjoyed jointly and that the Katha is in the
joint names. What is significant and important is the avowal by the
executants that they were in need of funds to meet the domestic
necessities and, consequently, had agreed to sell the suit
property. If any dispute arises with regard to the sale transaction, it
would be solved by the executants personally at their own risk and
cost. Lastly, if there was any loan, mortgage, revenue arrears, etc.
over the property, the same shall be cleared by the executants so
as to execute and register the sale deed in favour of Beereddy
Dasaratharami Reddy. The agreement to sell does mention that it
would be also executed by V. Manjunath, and it is a fact that it is
not signed and executed by him, but this, as discussed below,
would not nullify the rights and liabilities arising from the
agreement to sell.
6. Right of the Karta to execute agreement to sell or sale deed of a
joint Hindu family property is settled and is beyond cavil vide
Civil Appeal No. 7037 of 2021 Page 4 of 11
several judgments of this Court including Sri Narayan Bal and
Others v. Sridhar Sutar and Others,2 wherein it has been held
that a joint Hindu family is capable of acting through its Karta or
adult member of the family in management of the joint Hindu
family property. A coparcener who has right to claim a share in the
joint Hindu family estate cannot seek injunction against the Karta
restraining him from dealing with or entering into a transaction
from sale of the joint Hindu family property, albeit post alienation
has a right to challenge the alienation if the same is not for legal
necessity or for betterment of the estate. Where a Karta has
alienated a joint Hindu family property for value either for legal
necessity or benefit of the estate it would bind the interest of all
undivided members of the family even when they are minors or
widows. There are no specific grounds that establish the existence
of legal necessity and the existence of legal necessity depends
upon facts of each case. The Karta enjoys wide discretion in his
decision over existence of legal necessity and as to in what way
such necessity can be fulfilled. The exercise of powers given the
rights of the Karta on fulfilling the requirement of legal necessity or
betterment of the estate is valid and binding on other coparceners.
7. Elucidating the position in Hindu law, this Court in Kehar Singh
(D) through Legal Representatives and Others v. Nachittar
2 (1996) 8 SCC 54
Civil Appeal No. 7037 of 2021 Page 5 of 11
Kaur and Others3 has referred to Mulla on Hindu Law and the
concept of legal necessity to observe thus:
“20. Mulla in his classic work Hindu Law while dealing
with the right of a father to alienate any ancestral
property said in Article 254 , which reads as under:
“Article 254
254. Alienation by father.— A Hindu father as
such has special powers of alienating
coparcenary property, which no other
coparcener has. In the exercise of these
powers he may:
(1) make a gift of ancestral movable property
to the extent mentioned in Article 223 , and
even of ancestral immovable property to the
extent mentioned in Article 224;
(2) sell or mortgage ancestral property,
whether movable or immovable, including
the interest of his sons, grandsons and
great-grandsons therein, for the payment of
his own debt, provided the debt was an
antecedent debt, and was not incurred for
immoral or illegal purposes ( Article 294 ).”
21. What is legal necessity was also succinctly said by
Mulla in Article 241 , which reads as under:
“Article 241
241. What is legal necessity.—The following
have been held to be family necessities
within the meaning of Article 240:
(a) payment of government revenue and of
debts which are payable out of the family
property;
(b) maintenance of coparceners and of the
members of their families;
Civil Appeal No. 7037 of 2021 Page 6 of 11
(c) marriage expenses of male coparceners,
and of the daughters of coparceners;
(d) performance of the necessary funeral or
family ceremonies;
(e) costs of necessary litigation in recovering
or preserving the estate;
(f) costs of defending the head of the joint
family or any other member against a
serious criminal charge;
(g) payment of debts incurred for family
business or other necessary purpose. In the
case of a manager other than a father, it is
not enough to show merely that the debt is a
pre-existing debt;
The above are not the only indices for
concluding as to whether the alienation was
indeed for legal necessity, nor can the
enumeration of criterion for establishing legal
necessity be copious or even predictable. It
must therefore depend on the facts of each
case. When, therefore, property is sold in
order to fulfil tax obligations incurred by a
family business, such alienation can be
classified as constituting legal necessity.”
(See Hindu Law by Mulla “22nd Edition”)
xx xx xx
26. Once the factum of existence of legal necessity
stood proved, then, in our view, no co-coparcener
(son) has a right to challenge the sale made by the
karta of his family. The plaintiff being a son was one of
the co-coparceners along with his father Pritam Singh.
He had no right to challenge such sale in the light of
findings of legal necessity being recorded against him.
It was more so when the plaintiff failed to prove by any
evidence that there was no legal necessity for sale of
the suit land or that the evidence adduced by the
defendants to prove the factum of existence of legal
Civil Appeal No. 7037 of 2021 Page 7 of 11
necessity was either insufficient or irrelevant or no
evidence at all.”
8. The aforesaid being the legal position, it has to be held that
signatures of V. Manjunath, son of Karta – K. Veluswamy, on the
agreement to sell were not required. K. Veluswamy being the
Karta was entitled to execute the agreement to sell and even
alienate the suit property. Absence of signatures of V. Manjunath
would not matter and is inconsequential. As noted above, it is an
accepted case of the respondents that K. Veluswamy did receive
Rs.4 lakhs as advance from Beeredy Dasartharami Reddy, as
recorded in the agreement to sell.
9. On the question of satisfaction of the condition of legal necessity,
the stand of the respondents is contradictory, for they have
pleaded in the written statement and even before us that the joint
Hindu family was in need of funds, which shows legal necessity. In
fact, as recorded above, the need for funds is duly reflected and
so stated in the agreement to sell dated 8 th December 2006 which
states that the executants were in need of funds to meet domestic
necessities and, therefore, had agreed to sell the suit property. It
is also an undisputed position that the suit property was
encumbered in favour of the State Bank of Mysore, Adivala
Branch, and the executants had informed that the dues of the
Civil Appeal No. 7037 of 2021 Page 8 of 11
bank would be cleared to release the mortgage before the date of
registration. In Kehar Singh (supra), on the question what is legal
necessity, reference was made to Article 241 from Mulla’s Hindu
Law which states that maintenance of coparceners, family
members, marriage expenses, performance of necessary funerals
or family ceremonies, costs of necessary litigation for recovering
or preserving estate, etc. fall and have been held to be family’s
necessities. Further, the instances are not the only indices for
concluding whether the alienation was in need for legal necessity
as enumeration on what would be legal necessity is unpredictable
and would depend upon facts of each case. Thus, we are of the
opinion that the agreement to sell cannot be set aside on the
ground of absence of legal necessity.
10. Decision of this Court in Pemmada Prabhakar (supra) has no
application, being a case of intestate property inherited by wife,
three sons and three daughters as class I heirs under Section 8 of
the Hindu Succession Act and the agreement to sell was not
signed by wife, one son and three daughters and, therefore,
neither binding nor enforceable against the non-executants. The
ratio would not apply to a joint Hindu family property.
Civil Appeal No. 7037 of 2021 Page 9 of 11
11. Omission to frame an issue as required under Order XIV Rule 1 of
the Code of Civil Procedure , 1908 does not vitiate the trial where
the parties go to trial fully knowing the rival case and lead
evidence in support of their respective contentions and to refute
contentions of the other side (See – Kannan (Dead) by LRs. and
Others v. V.S. Pandurangam (Dead) by LRs . and Others 4 and
Nedunuri Kameswaramma v. Sampati Subba Rao5 ).
12. We are informed that during the pendency of the present appeal,
the suit property has been transferred to a third person, which
transfer would obviously be subject to and hit by the doctrine of lis
pendens. Therefore, once we set aside the impugned judgment
and restore the judgment of the trial court, the respondents would
be bound to perform their obligations under the agreement to sell
dated 8th December 2006 and execute the registered sale deed,
notwithstanding any transaction which the respondents have
executed.
13. In light of the aforesaid discussion, we allow the present appeal
and set aside the impugned judgment and decree and restore the
judgment and decree passed by the trial court. The appellant
would deposit the balance sale consideration of Rs.25 lakhs in the
4 (2007) 15 SCC 157
5 AIR 1963 SC 884
Civil Appeal No. 7037 of 2021 Page 10 of 11
trial court within a period of eight weeks from today, which amount
once deposited would be kept in an interest bearing fixed deposit
and would be handed over/paid to K. Veluswamy, Karta of the joint
Hindu family at the time of execution of the sale deed by him in
favour of the appellant/Beereddy Dasartharami Reddy. The
appellant/Beereddy Dasartharami Reddy will also bear necessary
expenses like stamp duty, registration charges for execution of the
sale deed. Physical possession of the property would be handed
over by the respondents to the appellant/Beereddy Dasartharami
Reddy along with the execution of the sale deed, notwithstanding
that the suit property has been sold to a third person during the
pendency of the present appeal.
14. The appeal is disposed of in the above terms without any order as
to costs.
......................................J.
(M.R. SHAH)
......................................J.
(SANJIV KHANNA)
NEW DELHI;
DECEMBER 13, 2021.
Civil Appeal No. 7037 of 2021 Page 11 of 11
Related AI tags, queries and research notes
Translation
About
Disclaimer
Privacy Policy
Terms
Case Removal
Blog
Share URL
Mobile View
⚖
Case Recast AI