There is often a confusion while seeking partition of properties amongst Hindu families, whether parties should opt for a partition deed or a family settlement.
There is often a confusion while seeking partition of properties amongst Hindu families, whether parties should opt for a partition deed or a family settlement. The effect of the both is same-divide the property.
The substantial difference is that of payment of stamp duty and registration of the document recording partition. A family settlement does not require registration and stamping, however partition deed requires both-hence execution of the partition deed is a costly remedy. Many people draw a family settlement, however it is drawn in such a fashion that courts read it as partition deed, thus the consequences of non-registration and non-stamping get attracted. Thus in order to put the binding effect and the essentials of a family settlement in a concretized form, the matter may be reduced into the form of the following propositions:
(1) The family settlement must be a bona fide one so as to resolve family disputes and rival claims by a fair and equitable division or allotment of properties between the various members of the family;
(2) The said settlement must be voluntary and should not be induced by fraud, coercion or undue influence;
(3) The family arrangements may be even oral in which case no registration is necessary;
(4) It is well settled that registration would be necessary only if the terms of the family arrangement are reduced into writing. Here also, a distinction should be made between a document containing the terms and recitals of a family arrangement made under the document and a mere memorandum prepared after the family arrangement had already been made either for the purpose of the record or for information of the Court for making necessary mutation. In such a case the memorandum itself does not create or extinguish any rights in Immovable properties and therefore does not fall within the mischief of Section 17(2) (sic) (Section 17(1)(b)?) of the Registration Act and is, therefore, not compulsorily registrable;
(5) The members who may be parties to the family arrangement must have some antecedent title, claim or interest even a possible claim in the property which is acknowledged by the parties to the settlement. Even if one of the parties to the settlement has no title but under the arrangement the other party relinquishes all its claims or titles in favour of such a person and acknowledges him to be the sole owner, then the antecedent title must be assumed and the family arrangement will be upheld, and the Courts will find no difficulty in giving assent to the same;
(6) Even if bona fide disputes, present or possible, which may not involve legal claims are settled by a bona fide family arrangement which is fair and equitable the family arrangement is final and binding on the parties to the settlement.
The author of this Article is Anupam Srivastava who can be reached at email@example.com