20 December 2024 - Legal Updates

1. Partition of property During Owner’s Lifetime Impermissible In Mohammedan Law: Supreme Court

The Supreme Court emphasized that a property partition through a gift deed during the owner's lifetime cannot be validated under Mohammedan Law. The Court explained that the concept of partition is not recognized under this legal framework, and as a result, a property partition via a gift deed is not valid due to the absence of a clear and explicit declaration of the donor's intent to make the gift. The bench, consisting of Justice CT Ravikumar and Justice Sanjay Karol, was hearing an appeal challenging the Karnataka High Court's decision, which upheld the trial court's ruling rejecting the partition executed by Sultan Saheb during his lifetime in favor of the appellants.

Sultan Saheb, the owner of certain properties, passed away in 1978. The Appellant-Plaintiffs, descendants of his daughter Rabiyabi, claimed a 1/6th share, alleging they were excluded from the revenue records. The Respondent-defendants argued that Sultan Saheb had partitioned and orally gifted portions of the property to his sons during his lifetime, which is not allowed under Mohammedan Law. The trial court dismissed the suit, ruling that partition during the owner's lifetime is impermissible and that the oral gift lacked essential requirements. The High Court upheld the trial court’s decision, emphasizing that partition during a person's lifetime is not recognized in Mohammedan Law.

The plaintiff appealed to the Supreme Court, arguing that Sultan Saheb's property partition was a valid gift to his heirs under Mohammedan Law, as the requisites for a valid gift were met. However, the Supreme Court upheld the High Court's decision, with Justice Karol's judgment stating that partition during the owner's lifetime is not recognized under Mohammedan Law. The Court clarified that while a Muslim can transfer property through a Hiba (gift) during their lifetime, it is only valid if the essential requirements of a gift are fulfilled.

The essential requisites of a valid gift are:

a) The gift has to be necessarily declared by the person giving the gift, i.e., the donor;

b) Such a gift has to be accepted either impliedly or explicitly by or on behalf of the donee; and

c) Apart from declaration and acceptance, there is also a requirement of delivery of possession for a gift to be valid.

The Court rejected the Appellant's argument that Sultan Saheb made a gift to his heirs, noting that there was no intention to transfer the property via gift. The Court pointed out that the Mutation Entry (No. 8258) referred to the property as a "partition" and not a gift, indicating Sultan Saheb's intention to divide the property rather than gift it. It also emphasized that for a gift to be valid, a clear declaration of the gift is required, which was absent in the mutation entries, thus failing to meet the conditions of a valid gift.

The Court noted that while the other two requisites for a valid gift—acceptance and possession—might have been proven, the essential requirement of a clear and unequivocal declaration was not met. Since the Mutation Entry neither indicated a gift nor supported the appellants' claim, the Court concluded that Sultan Saheb's oral gift to his sons was invalid. As a result, the appeal was dismissed.

Case- Mansoor Saheb (Dead) & Ors. vs. Salima (Dead) by Lrs. & Ors.

2. No Refund of Court Fee When Case is Settled By Mediation, Refund only when Settlement was at Lok Adalat: Supreme Court

On December 19, the Supreme Court ruled that a dispute settled through mediation under Section 89 of the Code of Civil Procedure (CPC) should not be treated the same as a settlement through Lok Adalat regarding court fee refunds. While Lok Adalat provides a 100% refund, the appellant in this case was refunded 50% of court fees under the Maharashtra Court Fees Act, 1959. The appellant challenged this, citing the Central Court Fees Act, 1870, which mandates a 100% refund for disputes settled through Lok Adalat. The Court emphasized that court fee refunds in alternative dispute resolution mechanisms are incidental to the dispute resolution process.

The appellant mistakenly equated mediation proceedings, settled by a Court's decree, with Lok Adalat awards. He argued that since alternative dispute resolution is part of the administration of justice under Entry 11A, List III (Concurrent List), the Central legislation should prevail over the Maharashtra legislation, which only provides for a 50% refund of court fees. However, the bench of Justices Sanjay Karol and CT Ravikumar ruled that court fees are governed by Entry 3, List II (State List), and thus, the matter is not subject to a conflict between Central and State laws.

The Court concluded that Entry 11A, List III (Concurrent List) does not govern court fee refunds for disputes settled through alternative dispute resolution (ADR), as it is superseded by Entry 3, List II (State List). It emphasized that Lok Adalat and mediation are distinct methods and should not be equated, meaning the 100% court fee refund applicable to Lok Adalat settlements does not apply to mediation. The Court further clarified that court fee refunds, whether partial or full, are incidental benefits to dispute resolution and do not fall under the purview of Entry 11A, List III, as ADR primarily aims to reduce case backlogs. The appeal was dismissed.

Facts of the case

The appellant filed a civil suit for specific performance of a property sale agreement, which was referred to mediation under Section 89 of the CPC and resolved amicably. The settlement terms were presented to the Court, and the suit was disposed of. The appellant was granted a 50% refund of court fees. However, the appellant filed a writ petition before the Bombay High Court, arguing that since the matter was settled through Lok Adalat, the full court fee refund should apply, as per the Court Fees Act, 1870. The High Court ruled that the 1870 Act no longer applied in Maharashtra due to the enactment of the Maharashtra Court Fees Act, 1959, which provides for a 50% refund. This decision was challenged before the Supreme Court.

What did the Supreme Court say?

The Supreme Court clarified that the refund of court fees under Section 89 of the CPC is governed by the Maharashtra Court Fees Act and does not follow the same rules as refunds for disputes settled through Lok Adalat. The Court emphasized that alternative dispute resolution (ADR) methods, like mediation, should be encouraged, but noted that Lok Adalat and mediation are distinct processes. The Court rejected the appellant's argument that mediation should be treated the same as Lok Adalat for court fee refunds. While the Court ruled in favor of a full refund of court fees in this case, it stated that this decision should not be treated as a binding precedent.

Case- Sanjeev Kumar Harakchand Kankariya vs. Union of India & Ors.

3. Ex Husband Can’t Be Expected to Maintain Ex-Wife as per His Present Status All Life; Alimony Not To Equalise Wealth: Supreme Court

The Supreme Court stated that a divorced wife cannot demand permanent alimony simply to match the ex-husband's wealth. While the wife is entitled to maintenance that reflects her standard of living during the marriage, the husband is not obligated to maintain her according to his current financial status. The Court noted that a divorced wife cannot claim higher alimony just because the husband has improved his financial situation after the separation.

The Court raised the question, "Would the wife still seek an equalization of wealth with the husband if, due to unforeseen circumstances after the separation, he were to become a pauper?" A bench consisting of Justice BV Nagarathna and Justice NK Singh expressed their concerns in this regard:

The Court expressed concerns about the tendency of parties seeking maintenance or alimony to demand equalization of wealth with the other party. It noted that such demands are typically made when the spouse is wealthy but are absent when the spouse’s financial situation has worsened after separation. The Court emphasized that maintenance aims to support the destitute and ensure social justice, not to equalize wealth. While the wife is entitled to be maintained in a manner similar to her life during the marriage, the husband is not obligated to maintain her according to his current financial status after separation. The Court argued that demanding maintenance based on the husband's improved status post-separation would unfairly burden his personal progress.

The Court was addressing the issue of permanent alimony following the dissolution of a marriage that was deemed irretrievably broken. The petitioner (wife) asserted that the respondent (husband) had assets worth Rs 5000 crores in the US and had provided Rs 500 crores in alimony to his first wife. The Court was surprised by the petitioner’s attempt to equalize her status not only with the respondent but also with his ex-wife. In the end, the Court determined the permanent alimony to be Rs 12 crores.

The Court stated that in determining alimony, it must consider not only the respondent-husband's income but also factors such as the petitioner-wife's income, her reasonable needs, her right to residence, and other relevant factors. The Court emphasized that the wife’s entitlement to maintenance should be based on her specific circumstances, rather than being influenced by what the husband paid to his ex-wife or his income alone. The judgment also noted that disputes over alimony amounts are often the most contentious in marital proceedings, accompanied by numerous accusations aimed at revealing the other party’s income and assets. The Court referred to the principles established in the cases of Kiran Jyot Maini vs. Anish Pramod Patel (2024) and Rajnesh vs. Neha (2020).

Case- Rinku Baheti vs. Sandesh Sharda