Undertaking As Contemplated U/S 4 Of Partition Act Must Be Unconditional: Allahabad High Court

Update: 2022-02-25 14:15 GMT
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The Allahabad High Court, sitting in Lucknow, recently held that a member of an undivided family being a shareholder of the family's dwelling-house is entitled to exercise his rights under Section 4 of the Partition Act only if the undertaking is unconditional. The declaration was made by Justice Jaspreet Singh.Section 4 of the Partition Act provides that where a share of a...

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The Allahabad High Court, sitting in Lucknow, recently held that a member of an undivided family being a shareholder of the family's dwelling-house is entitled to exercise his rights under Section 4 of the Partition Act only if the undertaking is unconditional. The declaration was made by Justice Jaspreet Singh.

Section 4 of the Partition Act provides that where a share of a dwelling-house belonging to an undivided family has been transferred to a person who is not a member of such family and such transferee sues for partition, the court shall, if any member of the family being a shareholder shall undertake to buy the share of such transferee, make a valuation of such share in such manner as it thinks fit and direct the sale of such share to such shareholder, and may give all necessary and proper directions in that behalf.

Sub-section 2 contemplates the procedure to be undertaken where two or more members of the family being such shareholders severally undertake to buy such share.

Question of Law

In the instant matter, the Court was called upon to decide two questions in the second appeal:

1. Whether the valuation of the share of the stranger in the house of the shareholder must be made by the court on the date of the judgment determining the respective shares of the transferee and the co-sharer? If yes, its effect on the decree passed by the lower appellate court.

2. Whether the "Undertaking " must be unconditional? and if yes whether the absence of any finding recorded by a lower appellate court in favour of the present respondent that he gave un-conditional 'undertaking to buy' the benefit of Sec. 4, partition Act could have been extended? and, if not, its effect?"

Case Background

The appeal was an upshot of the suit for partition filed by plaintiffs (Appellants herein) seeking separation of their 3/4th share in the house where the respondents wanted to purchase the 3/4th share of the stranger purchasers at the price at which the stranger purchasers had purchased the property from the owner of the property at such price to be determined by the Court.

Since the Lower Appellate Court had allowed the defendant's appeal and its counter claim, the present second appeal was preferred.

The counsel for the Appellant stated that the respondent was not entitled to exercise his rights under section 4 as the evidence recorded indicated that house in the question was not a family dwelling house. The counsel also stated that the judgement earlier by the lower court was given in accordance to Section 2 and Section 3 of the Partition Act which is not applicable in the instant and hence was un-justified.

It was further contended that the undertaking must be un-equivocal and unconditional and only then the same can be relied upon. However, since the respondent did not make an unconditional offer, hence, he was not entitled to the benefit of Section 4 of the Partition Act.

The counsel for the respondents stated that the respondents has earlier moved a separate application seeking enforcement of his rights to purchase the share of the stranger purchaser and hence he expressed undertaking and his willingness to purchase the share unconditionally.

The counsel also submitted that the house in question was a family dwelling house, and the Section 2 and Section 3 of the Partition Act were independent of Section 4 of the Partition Act and do not matter in the manner of valuation and determination of the value of a share is concerned.

Further, respondent both in his written statement as well as in a separate application had clearly given his undertaking to purchase the share of the stranger purchaser and throughout he has been ready and willing to purchase the share and in the aforesaid facts and circumstances, it cannot be said that any conditional undertaking was given.

Findings

As regards the issue of valuation of share of the stranger in the house of the shareholder, the bench averred that a reasonable appreciation has to be provided to ensure that the stranger purchaser may not be put to any unnecessary loss on account of delay in time between the date of making the application and the date on which he receives the money for the sale in favour of the co-sharer.

It stated that that the balance has to be fine tuned to render justice between the parties while noticing the natural accretion to the value of the property and its effect on the rights of the co-sharer and the stranger purchaser.

Thus, it was held that no straight jacket method can be adopted uniformly in all cases for valuation.
"Ordinarily, the date of valuation would be the date when the right to purchase accrues, in other words, it cannot be a date prior but must be the date of making an unconditional offer to purchase either by making a separate application or otherwise by making the undertaking in pleadings. Upon such application, the Court must make an earnest endevour to arrive at the valuation as soon as possible. While doing so the Court will be competent to notice the conduct of the parties, the cooperation, readiness and willingness to honour their respective contentions as well as other factors which may affect the escalation or downfall in the valuation of the share."

On the second issue, the bench negated the contention of the appellant that the Respondent had given a conditional offer to purchase.

It observed,

"it is no doubt true that an undertaking as contemplated under Section 4 of the Partition Act must be unconditional. Now in the instant case, the record reveals that the respondent in his written statement as well as in the Application bearing Paper No. C-17 had given a clear undertaking that he is ready to buy out the share of the appellate at Rs. 9,00,000/- or such other sum to be determined by the Court. Even from the perusal of the cross-examination of the respondent, it cannot be said that his offer was conditional."

Reliance was placed on Iliyas Ahmad and Others v. Bulaqi Chand & Ors., AIR 1917 (Alld) 2, wherein it was held that while enforcing the right under Section 4, there must be something more than a mere offer and the undertaking give to the Court should be unconditional and a person should not be able to resile from the same.

Reference was also made to Krushnakar and Others v. Kanhu Charan Kar & Ors., AIR 1962 (Orissa) 85, wherein Orissa High Court has also opined that the undertaking in terms of Section-4 of the Partition Act must be unconditional.

The Court went on to examine the legislative intent for enacting Section 4 of the Partition Act of 1893.

It noted that the legislature proposed to give the Court the power of compelling a stranger who has acquired by purchasing a share in the family dwelling house, when he seeks for partition, to sell his share to the members of the family who are the owners of the rest of the house at a valuation to be determined by the Court.
Thus, it opined that whenever an issue crops up before a Court regarding Section 4 of the Partition Act, it would be incumbent upon the Court to see that certain conditions as enumerated hereinafter are fulfilled before an an order can be passed enforcing the right of a person in terms of the said Section 4.
The conditions are:
(i) It is sine-qua-non that the disputed property must be a family dwelling house where the co-owners have undivided share and one or more of such co-owners have affected a transfer of their undivided share.
(ii) For invoking Section 4 of the Partition Act the transferee of an undivided share of the co-owner should be a stranger/outsider to the family.
(iii) Such a stranger purchaser must institute proceedings for partition and separate possession of his undivided share transferred to him by the coowners in question.
(iv) When such a claim is instituted by the stranger purchaser then any member of the family who still has an undivided share in the dwelling house must come forward to press his claim of preemption by undertaking 24. to buy out the share of the stranger purchaser.
(v) At the time of accepting the claim for preemption made by the existing co-owners of the dwelling house in respect of the share of the stranger purchaser, it is the Court that should make a valuation of the share of the stranger purchaser and must make the existing co-sharer of the dwelling house to pay the value of the share of the stranger purchaser so that the existing co-owner is able to purchase by preemption the share of stranger purchaser in the dwelling house in its entirety so that the rights of the parties are completely satisfied and the stranger purchaser is left with no other right or share in the dwelling house and consequently, the stranger purchaser can be effectively denied entry in any part of the dwelling house.

Accordingly, the second appeal was allowed.

Case Title: Yogesh Kesarwani And Anr. vs Devi Shankar Shukla

Citation: 

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