Supreme Court Upholds Prior Partition of Joint Family Property: K. Arumuga Velaiah vs. P.R. Ramasamy (27 January 2022)

Introduction

Date of the Judgment: 27th January 2022

Citation: 2022 INSC 73

Judges: L. Nageswara Rao J., B.R. Gavai J., and B.V. Nagarathna J.

Can a family member claim a share in ancestral property when a previous partition has already been recognized by the courts? The Supreme Court of India recently addressed this question in a case concerning a dispute over joint family property. The core issue was whether a suit for partition could be maintained when a prior partition of the same property had already been established in earlier court proceedings. This judgment clarifies the application of res judicata in property disputes and the validity of family arrangements. The bench was composed of Justices L. Nageswara Rao, B.R. Gavai, and B.V. Nagarathna, with the judgment authored by Justice Nagarathna.

Case Background

The dispute revolves around the family of Marimuthu Servai. His sons, Periyaiya Servai and Muthu Servai, were part of a joint family. Periyaiya Servai had three sons: P.R. Ramasamy (first defendant), P.R. Kasilingam (second defendant), and Marimuthu (deceased). The plaintiff, K. Arumuga Velaiah, is the son of the second defendant, P.R. Kasilingam. The plaintiff claimed a one-fourth share in the joint family properties based on a will allegedly executed by his grandfather, Periyaiya Servai, on 26th January 1994. The first defendant contested this claim, asserting that a partition had already taken place in 1964, dividing the properties among Periyaiya Servai’s three sons, with no share allotted to Periyaiya Servai himself. This prior partition was a key point of contention throughout the legal proceedings.

The plaintiff’s claim was that the joint family properties should be divided into four shares, with one share going to him based on his grandfather’s will. He argued that after the death of Marimuthu, his share was bequeathed to the first defendant, resulting in the first defendant having a half share, and the remaining half to be divided between the plaintiff and the second defendant. The first defendant objected to the plaintiff’s claim, leading to the filing of the suit for partition and separate possession.

Timeline:

Course of Proceedings

The District Munsiff Court, Devakottai, dismissed the plaintiff’s suit (O.S. No. 101 of 2004), noting contradictory decrees from prior cases. The court recognized a valid partition in 1964, which was confirmed by the Sub-Court, Devakottai, in A.S. No. 37 of 1993. This prior partition meant Periyaiya Servai had no share to bequeath, thus invalidating the plaintiff’s claim based on the will. The First Appellate Court (A.S. No. 38 of 2005) upheld the Trial Court’s decision, emphasizing that the 1964 partition was valid and that Periyaiya Servai had no right to execute a will regarding the suit properties. The Madurai Bench of the Madras High Court dismissed the second appeal (S.A. No. 92 of 2007), stating that the issues raised by the plaintiff were not legally tenable and that the matter was barred by res judicata due to the prior decision in A.S. No. 37 of 1993.

Legal Framework

The case primarily involves the interpretation of the Registration Act, 1908, specifically Section 17(1)(e) and Section 49. Section 17(1)(e) of the Registration Act, 1908, mandates the registration of non-testamentary instruments that create, declare, assign, limit, or extinguish any right, title, or interest in immovable property of a value of one hundred rupees or more. Section 49 of the Registration Act, 1908, states that no document required to be registered under the Act can be received as evidence of any transaction affecting such property unless it has been registered. The core legal question was whether the 1964 partition, which was based on an arbitration award, required registration to be valid and admissible as evidence.

The Supreme Court also considered the principle of res judicata, which prevents the re-litigation of issues that have been decided in a previous case between the same parties. This principle was central to the High Court’s decision to dismiss the second appeal, as the issue of the 1964 partition had already been decided in A.S. No. 37 of 1993.

Arguments

Appellant’s Arguments:

• The appellant argued that the 1964 partition was based on an unregistered arbitration award, which, according to Section 17(1)(e) of the Registration Act, 1908, and Section 49 of the same Act, is invalid and not binding.
• The appellant contended that since the award was not registered, the family remained joint, and the suit properties were joint ancestral properties, making the suit for partition maintainable.
• The appellant also argued that the first appellate court in A.S. No. 37 of 1993 exceeded the scope of the remand order from the High Court by deciding on the validity of the partition when it was only supposed to determine the nature of the properties.
• The appellant relied on Shiromani and Ors. v. Hem Kumar and Ors., [1968] 3 SCR 639, Satish Kumar and Ors. v. Surinder Kumar and Ors., [1969] 2 SCR 244, and Lachhman Dass v. Ram Lal, [1989] 3 SCC 99, to support the argument that unregistered partition awards affecting immovable property require registration.
• The appellant also relied upon Asrar Ahmed v. Durgah Committee, Ajmer, AIR 1947 PC 1, to argue that an erroneous finding by a lower court is not binding under res judicata.

Respondent’s Arguments:

• The respondents argued that the 1964 partition was a family arrangement and did not require registration. They contended that a partition merely crystallizes the shares of coparceners and does not constitute a transfer of property.
• The respondents argued that the finding of partition in A.S. No. 37 of 1993 had attained finality and was binding on the parties, thus barring the fresh suit under the principle of res judicata.
• The respondents contended that even if the first appellate court had erred in its findings, the appellant should have challenged it in a second appeal rather than filing a fresh suit.
• The respondents relied on Kale and Ors. v. Deputy Director of Consolidation, [1976] 3 SCC 119, Bhoop Singh v. Ram Singh Major and Ors., [1995] 5 SCC 709, and Ravinder Kaur Grewal and Ors. v. Manjit Kaur and Ors., [2020] 9 SCC 706, to support their argument that family arrangements do not require registration and are binding on the parties.
• The respondents also relied on Ripudaman Singh v. Tikka Maheshwar Chand, [2021] 7 SCC 446, to emphasize that a compromise recognizing a pre-existing right does not require registration.

Submissions Table

Issues Framed by the Supreme Court

The Supreme Court framed the following issue for consideration:

1. Whether the suit filed by the plaintiff is barred in view of the judgment and decree passed in A.S. No. 37 of 1993 dated 23rd March, 1999, wherein it was held that a partition had been affected in relation to the joint family properties between the first and second defendants and late Marimuthu in the year 1964.

Treatment of the Issue by the Court

Authorities

Cases Relied Upon by the Court:

On the Registration of Partition Deeds:

• Shiromani and Ors. v. Hem Kumar and Ors., [1968] 3 SCR 639 (Supreme Court of India): Discussed the requirement of registration for partition deeds allotting specific properties to coparceners.
• Satish Kumar and Ors. v. Surinder Kumar and Ors., [1969] 2 SCR 244 (Supreme Court of India): Addressed whether an arbitration award for partition requires registration under the Registration Act, 1908.
• Champalal vs. Mst. Samarth Bai, [1960] 2 SCR 810 (Supreme Court of India): Cited in the context of the filing of an unregistered award.
• Kashinathsa Yamosa Kabadi v. Narsinga Bhaskarsa Kabadi, [1961] 3 SCR 792 (Supreme Court of India): Discussed the need for registration of records made by Panchas.
• Lachhman Dass v. Ram Lal, [1989] 3 SCC 99 (Supreme Court of India): Addressed the issue of stamping and registration of an arbitrator’s award.
• Ramaswamy Ayyar and Anr. v. Tirpathi Naik, ILR 27 Mad 43 (Madras High Court): Discussed the need to ascertain what a document purports to convey.
• Ratan Lal Sharma v. Purushottam Harit, [1974] 3 SCR 109 (Supreme Court of India): Held that an arbitration award that creates rights in immovable property requires registration.
• Ranjangam Iyer v. Ranjangam Iyer, AIR 1922 PC 266 (Privy Council): Discussed the distinction between a document creating an interest in property and one creating a right to obtain another document.

On Family Arrangements:

• Kale and Ors. v. Deputy Director of Consolidation, [1976] 3 SCC 119 (Supreme Court of India): Explained the essentials and binding nature of family settlements.
• Bhoop Singh v. Ram Singh Major and Ors., [1995] 5 SCC 709 (Supreme Court of India): Clarified the legal position regarding registration of documents under Section 17(2)(vi) of the Registration Act, 1908.
• Ravinder Kaur Grewal and Ors. v. Manjit Kaur and Ors., [2020] 9 SCC 706 (Supreme Court of India): Held that family settlements acted upon are binding and parties cannot resile from them.
• Ripudaman Singh v. Tikka Maheshwar Chand, [2021] 7 SCC 446 (Supreme Court of India): Held that a compromise recognizing a pre-existing right does not require registration.

On Res Judicata:

• Asrar Ahmed v. Durgah Committee, Ajmer, AIR 1947 PC 1 (Privy Council): Discussed whether an erroneous finding by a lower court is binding under res judicata.
• Mathura Prasad Sarjoo Jaiswal v. Dossibai N.B. Jeejeebhoy, AIR 1971 SC 2355 (Supreme Court of India): Explained the application of res judicata, particularly on questions of law.
• Mohanlal Goenka v. Benoy Kishna Mukherjee, AIR 1953 SC 65 (Supreme Court of India): Held that even an erroneous decision on a question of law operates as res judicata.
• State of West Bengal v. Hemant Kumar Bhattacharjee, AIR 1966 SC 1061 (Supreme Court of India): Clarified that an incorrect decision cannot be equated with a decision without jurisdiction.

Legal Provisions Considered by the Court:

• Section 17(1)(e) of the Registration Act, 1908: Mandates the registration of non-testamentary instruments that create, declare, assign, limit, or extinguish any right, title, or interest in immovable property of a value of one hundred rupees or more.
• Section 49 of the Registration Act, 1908: States that no document required to be registered under the Act can be received as evidence of any transaction affecting such property unless it has been registered.
• Section 17(2)(v) of the Registration Act, 1908: Exempts certain documents from compulsory registration, including those that merely create a right to obtain another document.

Authorities Table

Judgment

How each submission made by the Parties was treated by the Court?

How each authority was viewed by the Court?

• The Court distinguished the cases cited by the appellant, Shiromani and Ors. v. Hem Kumar and Ors., [1968] 3 SCR 639, Satish Kumar and Ors. v. Surinder Kumar and Ors., [1969] 2 SCR 244, and Lachhman Dass v. Ram Lal, [1989] 3 SCC 99, stating that they dealt with situations where specific properties were allotted under a partition deed or award, which required registration. In the present case, the 1964 award was a mere memorandum of understanding and did not create rights in specific properties.
• The Court relied on Kale and Ors. v. Deputy Director of Consolidation, [1976] 3 SCC 119, Bhoop Singh v. Ram Singh Major and Ors., [1995] 5 SCC 709, Ravinder Kaur Grewal and Ors. v. Manjit Kaur and Ors., [2020] 9 SCC 706, and Ripudaman Singh v. Tikka Maheshwar Chand, [2021] 7 SCC 446, to hold that family arrangements do not require registration and are binding on the parties, especially when acted upon.
• The Court held that Asrar Ahmed v. Durgah Committee, Ajmer, AIR 1947 PC 1, was not applicable to the present case, as the finding of partition had attained finality and was not challenged by the appellant.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the following factors:

• Finality of the 1964 Partition: The court emphasized that the finding of partition in A.S. No. 37 of 1993 had attained finality and was binding on the parties. This was a crucial point in the court’s reasoning, as it prevented the re-litigation of the same issue.
• Nature of the 1964 Award: The court determined that the 1964 award was a family arrangement and a memorandum of understanding, rather than a formal partition deed. This distinction was important because it meant that the award did not require registration under Section 17(1)(e) of the Registration Act, 1908.
• Principle of Res Judicata: The court applied the principle of res judicata, which prevents the re-litigation of issues that have been decided in a previous case between the same parties. This principle was central to the dismissal of the plaintiff’s suit.
• Binding Nature of Family Arrangements: The court recognized the binding nature of family arrangements, especially when they have been acted upon by the parties. This was based on the precedents set by previous judgments of the Supreme Court.
• Procedural Propriety: The court noted that the appellant should have challenged the finding of partition in a second appeal rather than filing a fresh suit. This highlights the importance of following the correct legal procedures.

Sentiment Analysis of Reasons Given by the Supreme Court:

Fact:Law Ratio

Logical Reasoning:

The court’s reasoning was primarily deductive, applying established legal principles to the specific facts of the case. The court reasoned that since the 1964 partition had been established in prior proceedings and was considered a family arrangement, the principle of res judicata applied, barring the plaintiff’s suit. The court also reasoned that the 1964 award was a memorandum of understanding and did not require registration. This was a logical application of the law to the facts, leading to the dismissal of the appeal.

Decision

The Supreme Court dismissed the appeal, upholding the decisions of the lower courts. The Court held that the suit filed by the plaintiff was barred by res judicata due to the prior finding of partition in A.S. No. 37 of 1993. The Court also affirmed that the 1964 partition was a family arrangement and did not require registration.

Flowchart of Decision Making

Implications

This judgment has significant implications for property law, particularly concerning family arrangements and partition suits:

• Res Judicata in Property Disputes: The judgment reinforces the principle of res judicata in property disputes, emphasizing that issues decided in prior proceedings cannot be re-litigated.
• Validity of Family Arrangements: The judgment clarifies that family arrangements, even if based on unregistered agreements or awards, are valid and binding, provided they have been acted upon by the parties.
• Registration of Partition Deeds: The judgment clarifies that not all partition arrangements require registration under the Registration Act, 1908. It distinguishes between formal partition deeds and family arrangements, holding that the latter do not necessarily require registration.
• Importance of Following Legal Procedures: The judgment underscores the importance of following proper legal procedures, particularly in challenging prior court decisions. Parties should appeal against unfavorable judgments rather than filing fresh suits.

Conclusion

The Supreme Court’s judgment in K. Arumuga Velaiah vs. P.R. Ramasamy reaffirms the binding nature of family arrangements and the importance of the principle of res judicata in property disputes. The Court clarified that not all partition arrangements require registration and upheld the validity of the prior partition established in earlier proceedings. This judgment serves as a crucial precedent for similar cases involving family property disputes and highlights the need for parties to follow proper legal procedures when challenging prior court decisions.