Shariat Law Doesn't Override Stamp Act; Transfer Of Property By Way Of Settlement Deed Permissible Among Mohammedans: Karnataka High Court

The Karnataka High Court has held that the Muslim Personal Law (Shariat) Application Act, 1937, does not override Section 2(q) and Article 48 of the Karnataka Stamp Act 1957, which deal with the contract of “settlement” thus, the transfer of property by way of “settlement” is very much permissible even among Mohammedans.

A single-judge bench of Justice Ananth Ramanath Hegde allowed an appeal filed by Sultan Mohiyuddin and others and set aside the order of the trial court which had allowed the suit for partition and separate possession filed by Habeebunnissa and others and held that the transfer of property through settlement deed as was done by the father of the appellant is impermissible among the Mohammadans.

It said “When the Act of 1937 was brought into force, the Indian Stamp Act, 1899 was in force. The said Act of 1899 also recognised the “settlement”. The term “settlement” defined in Section 2(24) of the Act of 1899 is in substance similar to the definition of the term “settlement” in Section 2(q) of the Act of 1957. This being the position, the Court has to hold that the Act of 1937 does not override the provisions of the Act of 1957. Thus, the transfer of property by way of “settlement” as defined under the provisions of the Act of 1957 is very much permissible even among the Mohammadans.”

It was stated the suit was filed by Habeebunnisa and Khairunnisa, the daughters of T.A. Abdul Jabbar from his third wife Haleema Bi. The first defendant was Haleema Bi. The second defendant, Najimunnisa is the widow of T.A.Abdul Rasheed, the son of T.A.Abdul Jabbar from his first wife Bibijan. The defendants No.3 to 5 are the sons of T.A. Abdul Rasheed.

It was argued that T.A. Abdul Jabbar executed a deed of settlement on 10.09.1965, in favour of his grandsons namely Sultan Moyuddin, Ahmed Pasha, and Azaz Pasha. All are the children of T.A. Abdul Rasheed.

It was submitted that on 11.09.1965, T.A. Abdul Jabbar executed another settlement deed in respect of sites No.68, 91, and 92 in Sy. No.104 of Guddadahalli i.e., a schedule property and also the entire 'B' schedule property in favour of his only son T.A.Abdul Rasheed. In the same settlement deed, Rs.5,000/- is given to the third wife Haleema Bi.

On 13.09.1965, one more settlement deed was executed by T.A. Abdul Jabbar in favour of his minor daughters namely the plaintiffs/respondents No.1 and 2. All the settlement deeds are registered under the provisions of the Registration Act, of 1908. The first and the third settlement deeds referred to above were not under challenge.

The suit was filed claiming a share in the properties covered by the second settlement deed dated 11.09.1965. Defendants No.2 to 5 resisted the suit and defended the settlement deed. Defendants also contended that the suit is barred by limitation. The trial Court has held that there is no concept of transfer by way of “settlement” to settle the properties among the Mohammadans. Accordingly, the suit is decreed ordering the partition of all the properties covered under the settlement deed of 11.09.1965.

The appellants argued that the evidence on record namely the settlement deed and revenue records would clearly demonstrate that the possession of the property is transferred to the beneficiaries of the settlement deed. Moreover, three sites described in Schedule A were sold even before the suit and the plaint was filed and it is not amended seeking cancellation of the sale deeds in the names of the purchasers who are subsequently added as parties to the suit.

The respondents contended that "transfer of the property through a settlement deed" is not expressly recognised in the Shariat Law. He would submit that any transaction which is likely to deprive the right of an heir apparent violates the principles of Shariat Law.

Another respondent argued that the settlement deed in question is contrary to the Quranic injunction. He would urge that any transaction that deprives a right of an heir apparent and confers an advantage on another, and/or consequently discriminates among the heirs of a settler, is forbidden in the Quran. The settlement deed in question seeks to confer an unfair advantage over the descendants of T.A.Abdul Jabbar from his first wife to the detriment of the third wife and the children from the third wife of T.A.Abdul Jabbar.

The bench referring to Section Section 2(q) of the Act of 1957 noted that In short, the “settlement”, under the Act of 1957 is a contract involving the property. It involves the owner and the beneficiary. Since it is a contract any person competent to contract irrespective of his or her religious faith or belief can enter into a contract of settlement either as a settler or beneficiary. To be a settler, in addition, he must own a property.

Further, it said “The definition of “settlement” referred to above does not mandate equal or equitable distribution of the property through a settlement deed. The settler is competent to settle the property in a manner he chooses as long as his discretion does not violate any law.”

It added “The application of the Act is not dependent on religious faith or belief. It applies to all, irrespective of their religious faith or belief. In other words, the Act is religion-neutral.”

Rejecting the contention that the settlement deed in question is contrary to the Quranic injunction, the Court said “It may be true that a contract resembling a “settlement” or a transaction which squarely falls within the definition of a “settlement” under Section 2(q) of the Act of 1957 may not find reference in the Quran, or any other religious prescription for that matter. The Shariat law which is believed to be the divine instructions of the Almighty may not envisage all types of contracts which are recognised under contemporary law. That does not mean that the contract entered through a 'deed of settlement' is impermissible among the Mohammadans.”

Then it held that if a contract which is neither recognised nor forbidden in Sharia law; and which is expressly recognised in a Law that is religion-neutral, such contract should be held permissible under the religion-neutral law, irrespective of their religious faith including Mohammadans.”

Observing that Section 2 of the Act of 1937 provides that on the matters specified in the said Section, the Court said that the Muslim Personal Law (Shariat) will prevail over any usage or customs to the contrary. 

On merits, the court said that out of the three settlement deeds executed by their father, having received the benefits under one of the settlement deeds, the plaintiffs have selectively chosen to assail the other settlement deed executed by their father which does not confer benefit to them.

Thus, it was stated that the plaintiffs cannot be permitted to assail another settlement deed by their father which does not confer benefit to the plaintiffs.

Accordingly, the Court allowed the appeal.

Appearance: Advocate Manu Kulkarni a/w Advocate Kesthur Sudarshan and Amrita Aryendra for Appellants.

Senior Advocate Vikram Huilgol a/w Advocate Mohammed Tahir FOR R1 TO R3.

Citation No: 2024 LiveLaw (Kar) 204

Case Title: Sultan Mohiyuddin & Others AND Habeebunissa & Others

Case No: RFA NO.626 OF 2013

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