Alienation Of Joint Hindu Family Property By 'Karta' For Legal Necessity Or Benefit Of Estate Binding On Other Members: Supreme Court

Where a Karta has alienated a joint Hindu family property for value either for legal necessity or benefit of the estate it would bind the interest of all undivided members of the family even when they are minors or widows, the Supreme Court observed in a judgment.

In this case, K. Veluswamy as a Karta of the joint Hindu family executed the agreement to sell of the suit property for Rs.29 lakhs and had received Rs.4 lakhs in advance from Beereddy Dasaratharami Reddy. Beereddy Dasaratharmi Reddy instituted the suit for specific performance of the agreement to sell impleading both K. Veluswamy and V. Manjunath (son of Veluswamy). This suit was decreed by the Trial Court.

Manjunath preferred first appeal before the High Court contending that the agreement to sell is unenforceable as the suit property belongs to the joint Hindu family consisting of three persons, K. Veluswamy, his wife V. Manimegala and his son V. Manjunath and, therefore, could not have been executed without the signatures of V. Manjunath. The High Court held that the execution of the agreement to sell by K. Veluswamy as a Karta of the joint Hindu family is not established as no issue on the aspect of authority of the Karta to execute the agreement to sell and legal necessity was framed.

The Apex Court bench comprising Justices MR Shah and Sanjiv Khanna noted that a joint Hindu family is capable of acting through its Karta or adult member of the family in management of the joint Hindu family property.

"A coparcener who has right to claim a share in the joint Hindu family estate cannot seek injunction against the Karta restraining him from dealing with or entering into a transaction from sale of the joint Hindu family property, albeit post alienation has a right to challenge the alienation if the same is not for legal necessity or for betterment of the estate. Where a Karta has alienated a joint Hindu family property for value either for legal necessity or benefit of the estate it would bind the interest of all undivided members of the family even when they are minors or widows. There are no specific grounds that establish the existence of legal necessity and the existence of legal necessity depends upon facts of each case. The Karta enjoys wide discretion in his decision over existence of legal necessity and as to in what way such necessity can be fulfilled. The exercise of powers given the rights of the Karta on fulfilling the requirement of legal necessity or betterment of the estate is valid and binding on other coparceners.", the court said.

Thus the court held that signatures of V. Manjunath, son of Karta K. Veluswamy, on the agreement to sell were not required. "K. Veluswamy being the Karta was entitled to execute the agreement to sell and even alienate the suit property. Absence of signatures of V. Manjunath would not matter and is inconsequential. ", the court added.

While allowing the appeal, the bench referred to Kehar Singh (D) v. Nachittar Kaur (2018) 14 SCC 445 and said:

"In Kehar Singh (supra), on the question what is legal necessity, reference was made to Article 241 from Mulla's Hindu Law which states that maintenance of coparceners, family members, marriage expenses, performance of necessary funerals or family ceremonies, costs of necessary litigation for recovering or preserving estate, etc. fall and have been held to be family's necessities. Further, the instances are not the only indices for concluding whether the alienation was in need for legal necessity as enumeration on what would be legal necessity is unpredictable and would depend upon facts of each case. Thus, we are of the opinion that the agreement to sell cannot be set aside on the ground of absence of legal necessity"

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