# KALE & OTHERS v. DEPUTY DIRECTOR OF CONSOLIDATION & ORS

- **Citation:** [1976] 3 S.C.R. 202
- **Court:** Supreme Court of India
- **Decided:** 1976-01-21
- **Bench:** V. R. Krishna Iyer, R. S. Sarkaria Ands. Murtaza Fazal Ali
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/kale-others-v-deputy-director-of-consolidation-ors-6756
- **Pages:** 26

## Headnote

Family arrangement-Its object and purpose-Principle governirrg-1/ should
be registered-Oral arrangement-If permitted-If would operate as an estoppel.
Ret:istration Act. s. 17(1)(b)-Family arrangement if should be compu[..;
sorily reRistered.
(A) The object of a family arrangement is to protect the family from long
drawn litigation or perpetual strife which mars the unity and the solidarity of
the. family.
A family arrangement by which the property is equitably divided
between the various contenders so as to achieve an equal distribution of wealth,
instead of concentrating the same in the hands of a few, is a milestone in the administration of social justice. Where by consent of the parties a matter has
been settled, the courts have leaned in favour of upholding such a fan1ily arrangement instead of disturbing it on technical or trival grounds.
Where the
courts find that the family arrangement suffers from a legal lacuna or a formal
defect, the rule of estoppel is applied to shut out the plea of the person who.
being a party to the family arrangement, seeks to unsettle a settled dispute and
claims to revoke the family arrangement under which he has himself enjoyed
some material benefits.
[208 ·F-H: 209 A-Bl
(B) (i) The family settlement must be bona fide so as to resolve family
disputes; (ii) It must be voluntary and not induced by fraud, coercion or undue
influence; (iii) It may be even oral, in which case no~· registration is necessary;
(iv) Registration is necessary only if the terms are reduced to writing but where
the memorandum has been prepared after the family arrangement either for the
purpose of record or for information of court, the memorandum itself does not
create or extinguish any rights in immovable property and, therefore. does
not
fall within the mischief of s. 17(2) of the Registration Act and is not compulsorily registrable; (v) The parties to the family arrangement must have some
antecedent title, claim or interest, 'even a possible claim in the property which
is acknowledged by the parties to the settlement. But, even where a party has
no title and the other party relinquishes all its claims or titles in favour of such
a person and acknowledges him to be the sole owner, then, the antecedent title
must be assumed and the family arrangement will be upheld by the courts; (vi)
Where bona fide disputes are settled by a bona fide family arrangement, such
family arrangement is final and binding on the parties to settlement. f209 G-H;
210 A-El
Lala Khunni Lal & Ors v. Kunwar Gobind Krishna Narain and Anr. _L.R.
38 I.A. 87. 102: Mt. Hiran Bibi and others v. Mt. Sohan Bibi, A.LR. 1914 P.C.
44; Sahu Madho Das and others v. Pand_it Mukand Ram and another [1955]
2 S.C.R. 22, 42-43; Ran1 Charan Das v. Girijanandini Devi & Ors. [19651 3 S.C.R.
841, 850-851; Tek Bohodur Bhujil v. Devi Singh Bhujil and others, A.l.R. 1966
S.C. 292, 295; Maturi Pullaiah and Anr. v. Maturi Narasimham and Ors. A.I.R.
1966 SC 1836; Krishna Biharilal v. Gulabchand and others. [1971] Supp. SCR
27, 34 and S. Shanmugam Pillai and others v. K. Shanmugam Pillai .and others.
[1973] 2 S.C.C. 312, fOllowed.
Ram Gopal v. T.ulshi Ram and another, A.l.R. 1928 All. 641 649; Sitalrt
Baksh Singh and others v. Jang Bahadur Singh and others, A.I.R. 1933
Oudh
347, 348-349; M.st.
Kalawati v. Sri Krishna
Prasad and
others, l.L.R. 19
Lucknow 57. 67: Bakhtawar v. Sunder Lal and others. A.LR. 1926 All. 173, 175;
and Awadh Narain Sinf!h and others v. Narain Mishra and others, A.I.R. 1962:
Patna 400, app:r_aved.
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KALE V. DIRECTOR CONSOLIDATION
203
On the death of the father the family consisted of two unmarried daughters
A
(respondents 4 and 5) and appellant no. 1 (son of the married eldest daughter,
appellant No.
2).
After the marriage
of
respondents 4
and
5
the property left behind by the father was mutated in the name of appellant no. 1 who, under s. 36 of the U.P. Tenancy Act;, 1939, was the sole heir.
Eventually, however, the parties arrived at a family

## Text

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202
KALE & OTHERS
v.
DEPUTY DIRECTOR OF CONSOLIDATION & ORS.
January 21, 1976
[V. R. KRISHNA IYER, R. S. SARKARIA ANDS. MURTAZA FAZAL ALI, JJ.J
Family arrangement-Its object and purpose-Principle governirrg-1/ should
be registered-Oral arrangement-If permitted-If would operate as an estoppel.
Ret:istration Act. s. 17(1)(b)-Family arrangement if should be compu[..;
sorily reRistered.
(A) The object of a family arrangement is to protect the family from long
drawn litigation or perpetual strife which mars the unity and the solidarity of
the. family.
A family arrangement by which the property is equitably divided
between the various contenders so as to achieve an equal distribution of wealth,
instead of concentrating the same in the hands of a few, is a milestone in the administration of social justice. Where by consent of the parties a matter has
been settled, the courts have leaned in favour of upholding such a fan1ily arrangement instead of disturbing it on technical or trival grounds.
Where the
courts find that the family arrangement suffers from a legal lacuna or a formal
defect, the rule of estoppel is applied to shut out the plea of the person who.
being a party to the family arrangement, seeks to unsettle a settled dispute and
claims to revoke the family arrangement under which he has himself enjoyed
some material benefits.
[208 ·F-H: 209 A-Bl
(B) (i) The family settlement must be bona fide so as to resolve family
disputes; (ii) It must be voluntary and not induced by fraud, coercion or undue
influence; (iii) It may be even oral, in which case no~· registration is necessary;
(iv) Registration is necessary only if the terms are reduced to writing but where
the memorandum has been prepared after the family arrangement either for the
purpose of record or for information of court, the memorandum itself does not
create or extinguish any rights in immovable property and, therefore. does
not
fall within the mischief of s. 17(2) of the Registration Act and is not compulsorily registrable; (v) The parties to the family arrangement must have some
antecedent title, claim or interest, 'even a possible claim in the property which
is acknowledged by the parties to the settlement. But, even where a party has
no title and the other party relinquishes all its claims or titles in favour of such
a person and acknowledges him to be the sole owner, then, the antecedent title
must be assumed and the family arrangement will be upheld by the courts; (vi)
Where bona fide disputes are settled by a bona fide family arrangement, such
family arrangement is final and binding on the parties to settlement. f209 G-H;
210 A-El
Lala Khunni Lal & Ors v. Kunwar Gobind Krishna Narain and Anr. _L.R.
38 I.A. 87. 102: Mt. Hiran Bibi and others v. Mt. Sohan Bibi, A.LR. 1914 P.C.
44; Sahu Madho Das and others v. Pand_it Mukand Ram and another [1955]
2 S.C.R. 22, 42-43; Ran1 Charan Das v. Girijanandini Devi & Ors. [19651 3 S.C.R.
841, 850-851; Tek Bohodur Bhujil v. Devi Singh Bhujil and others, A.l.R. 1966
S.C. 292, 295; Maturi Pullaiah and Anr. v. Maturi Narasimham and Ors. A.I.R.
1966 SC 1836; Krishna Biharilal v. Gulabchand and others. [1971] Supp. SCR
27, 34 and S. Shanmugam Pillai and others v. K. Shanmugam Pillai .and others.
[1973] 2 S.C.C. 312, fOllowed.
Ram Gopal v. T.ulshi Ram and another, A.l.R. 1928 All. 641 649; Sitalrt
Baksh Singh and others v. Jang Bahadur Singh and others, A.I.R. 1933
Oudh
347, 348-349; M.st.
Kalawati v. Sri Krishna
Prasad and
others, l.L.R. 19
Lucknow 57. 67: Bakhtawar v. Sunder Lal and others. A.LR. 1926 All. 173, 175;
and Awadh Narain Sinf!h and others v. Narain Mishra and others, A.I.R. 1962:
Patna 400, app:r_aved.
•
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KALE V. DIRECTOR CONSOLIDATION
203
On the death of the father the family consisted of two unmarried daughters
A
(respondents 4 and 5) and appellant no. 1 (son of the married eldest daughter,
appellant No.
2).
After the marriage
of
respondents 4
and
5
the property left behind by the father was mutated in the name of appellant no. 1 who, under s. 36 of the U.P. Tenancy Act;, 1939, was the sole heir.
Eventually, however, the parties arrived at a family settlement allotting khatas
5 and 90 to the appellant No. 1 and khatas 53 and 204 to respondents 4 and 5.
This family arrangement was not registered. The revenue records were, however, corrected.
At the time of revision of records under the U.P. Consolidation of Holdings Act, 1953 appellant No. 1 found that he was shown as having
B
one-third share in all the properties: The Consolidation Officer removed his
name from the records and substituted the names of the sisters namely appellant No. 2 and respondents 4 and 5.
On appeal the Settlement Officer restored
the names of appellant no. 1 in respect of khatas 5 and 90 and of respondents
4 and 5 in respect of khatas 53 and 204 which was in accordance with the family
arrangement. The Deputy Director of Consolidation reversed this finding. The
High Court dismissed the appellants' appeal.
On further appeal to this Court, it was contended that (i) the High Court
C
erred in rejecting the compromise on the ground that it wa~ not registered but
that in view of the oral family arrangement no question ef registration -of the
compromise arose and (ii) eVen if the compromise was unregistered it would
operate clearly as estoppel against respondents 4 and 5.
Allowing the appeal,
HELD : The Deputy Director of Consolidation as well as the High Court
was wrong in taking the view that in the absence of registration the
family
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arrangement could not be sustained.
The High Court also erred in not giving
effect to the doctrine of estoppel.
r217 Cl
(I) (a) In the instant case the facts clearly show that a compromise or
family arrangement had taken place orally before the petition was filed
for
mutation of the names of the parties.
(b) The word family canpot be construed in a narrow sense so as to be
confined only to persons who have a legal title to the property. When the talks
for compromise took place .. appellant No. 1 was a prospective heir and a mem"'
ber of the family.
Secondly respondents 4 and 5 relinquished their claims in
favour of the appellant in respect of Khatas 5 and 90.
The appellant would,
therefore, be deemed to have antecedent title which was acknowledged by respondents 4 and 5.
[217Gl
( c) There can be no doubt that the family arrangement was bona fide.
At
no sta2e of the case had the respondents raised the issue of bona fides. [218D]
(d) The allegation of fraud and undue influence must first clearly be pleaded and then proved by clear and cogent evidence.
In the present case, there
was neither pleading nor proof of this fact by respondents 4 and 5.
Respondents Nos. 4 and 5 who were parties to the family arrangement and, .who, having
been benefited thereunder, would be precluded from assailing the same.
[219A]
Rani Gouda A nnagouda & others v. Bhausaheb and others, L.R. 54 I.A. 396,
Teferred to.
(2) Assuming that the family arrangement was compulsorily registrable, a
family arrangement being binding on the parties to it, would operate as an estoppel by preventing the parties after having taken advantage under the arrangement to resile from the same or try to revoke it. In the present case respondents
Nos. 4 and 5 would be estopped from denying the existence of the family arrangement or from questioning its validity.
r223 Fl
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Kanhai Lal;_. Brij Lal and Anr., L.R. 45 I.A. 118, 124; Dhiyan Singh and
Anr . . v: l11Na_I K1shore and Anr., [1952] S.C.R. 478; Rani ('haran /)as v. Girjall
nand1111 L>tr1 &- Ors. {1965] 3 S.C.R. 841, 850-851; Krishna Biharilal v. Gulabchand and others, [1971] Supp. S.C.R. 27, 34 and S. Shanmugam Pillai and
others v. K. ShanmuKam Pillai & Others. [1973) 2 S.C.R. 312, referred to.
204
SVPREME COURT REPORTS
[1976] 3 S.C.R.
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Rachcha v. Mt. Mendha A.I.R. 1947 All. 177 and Chief Controlling Reve11ue
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Authority
v.
Sn11. Satyawati Sood and others, A.LR. 1972 Delhi 171, held
inapplicable .
.htlr. .Justice Sarkaria concurred \\'ith majority view that the family arrangement was binding, but reserved his opinion with regard to the alternative pro-
,position, that assuming the family arrangement was compulsorily fe:gistrable
under s. 17 ( 1) (b) of the Registration Act, it could be used to raise an estoppel
against any of the parties to the suit.
[227El
CIVJL APPELLATE JURISDJCTJON : Civil Appeal No. 37 of 1968.
Appeal by special leave from the judgment and order dated
•
17-5-1966 of the Allahabad High Court in Special Appeal No. 640
of 1965.
R. K. Garg, S. C. Agrawala and V. J. Francis, for the appellants.
B. D. Sharma, for respondents Nos. 4 and 5
The Judgment of V. R. Krishna Iyer and S. Muataza Fazal Ali,
JJ. was delivered by Fazal Ali, J. R. S. Sarkaria, J. gave a separate
Opinion.
·
FAZAL ALI J. This is an appeal by special leave against the judgment of the Allahabad High Court dated May 17,
1966 by which
the appeal against the decision of a Single Judge of the High Court
rejecting the writ petition of the appellants had been dismissed.
An
application for granting a certificate for" leave to appeal to this Court
was made by the appellant before the High
Court which was also
dismissed by order of the High Court dated August 7, 1967.
The case had a rather chequered career and the disputes between
the parties were sometimes settled and sometimes re-opened.
In
order, however, to understand the poirit involved in the
present
appeal, it may be necessary to enter into the domain of the contending
claims of the respective parties put forward
before
the
Revenue
Courts from time to time.
To begin with the admitted position
is
that one Lachman the last propositor was the tenant and the tenure
holder of the property in dispute which consists of 19. 73 acres
of
land contained in Khatas Nos.
5 & 90 and 19.24 acres of land
comprising Khatas Nos. 53 & 204.
Lachman died in the year 1948
leaving behind three daughters, namely, Musamat
Tikia,
Musamat
Har Pyari and Mrisamat Ram Pyari.
Musamat Tikia was married
during the life time of Lachman and the appellant No. 1 Kale is the
son of Musamat Tikia. Thus it would appear that after the death of
Lachman the family consisted of his two unmarried daughters Har
Pyari and Ram Pyari and his married daughter's son Kale.
Under
the U.P. Tenancy Act, 1939 which applied to the parties only unmarried daughters inherit the property.
The first round of dispute
appears to have arisen soon after the death of Lachman in the year
1949 when Panchayat Adalat of the village was asked to decide the
dispute between Prem Pal nephew of
Lachman and the appellant
Kale regarding inheritance to the property left by Lachman.
Har
Pyari and Ram Pyari appear to have been parties to that dispute and
the Panchayat Adalat after making local
enquiries held that Har
Pyari having been married had lost her right in the estate and Ram
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KALE v. mRECTOR CONSOLIDATION (Fazal Ali, !.)
205
Pyari was also an heir so long as she was not married and after her
marriage the legal heir to the property of Lachman would be the
appellant Kale.
In the year 1952 the U.P. Zammdari Abolit1on and
Land Reforms Act, 1950 was made applicable to the tenure holders
also.
This Act was further amended on October 10, 1954 by Act
20 of 1954 by which, amongst the list of heirs enumerated
under
the statute, ''unmarried daughter" was substituted by "daughter"
only.
According to the appellant in this Court as also in the High
Court Ram Pyari respondent No. 5 was married on February 25,
1955 and thereafter the appellant filed a petition before the
Naib'
Tahsildar, Hasanpur, for expunging the names of respondents 4 and
5 from the disputed Khatas because both of the daughters
having
been married ceased to have any interest in the property. It was
therefore prayed that the appellant was the sole heir to the estate of
Lachman under s. 36 of the U.P. Tenancy Act, 1939, he alone should
be mutated in respect of the property of Lachman.
By order dated
December 5, 1955 the Naib Tahsildar, Hasanpur, accepted the contention of the appellant and expunged the names of respondents 4
& 5 from the Khatas in dispute and substituted the name of the appellant Kale.
Soon thereafter on January 11, 1956, respondents
4
& 5, i.e. Musamat Har Pyari and Ram Pyari daughters of Lachman,
filed an application before the Naib Tahsildar for setting aside his
order dated December 5, 1955 which had been passed behind their
back and without their knowledge.
While this application oE respondents 4 & 5 was pending adjudication the Revenue Court was
informed that talk of compromise was going on between the parties
which ultimately culminated in a compromise or a family arrangement
under which the appellant Kale was allotted Khatas Nos. 5 & 90 whereas respondents 4 & 5 were allotted Khatas Nos. 53 & 204 as between
them.
A petition was filed on August 7, 1.956 before the Revenue
Court informing it that a compromise had been arrived at and
in
pursuance thereof the names of the parties may be mutated in respect of the Khatas which had been allotted to them.
This petition
was signed by both the parties and ultimately the Assistant Commissioner, I Class, passed an order dated March 31, 1957 mutating the
name of the appellant Kale in respect of Khatas Nos. 5 & 90 and
the names of respondents 4 & 5 in respect of Khatas Nos. 53 and 204.
Thereafter it is not disputed that the parties remained in possession
of the properties allotted to them and paid land revenue to the Government.
Thus it would appear that the cjispute between the
parties
was finally settled and both the parties accepted the same and took
benefit thereunder. This state of affairs continued until the year 1964
when proceedings for revision of the records under s. 8 of the
U.P.
Consolidation of Holdings Act, 1953 were
started
in
the
village
Hasanpur where the properties were situated in the course of which
respondents 4 & 5 were entered in Form C.H. 5 as persons claiming
co-tenure holders to the extent of 2/3rd share with
the
appellant
Kale who was entered in the said form as having 1 /3rd share in all
the .Khatas. In view of this sudden change of the entries which were
obviously contrary to. the mutation made in pursuance of the family
arrangement entered mto between the parties in 1956, the appellant
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SUPREME COURT REPORTS
[1976] 3 S.C.R.
Kale filed his objections before the Assistant Consolidation Officer
for changing the entries in respect of those Khatas.
As the Assistant Consolidation Officer found that the dispute was a complicated
one he by his order dated May 7, 1964 referred the matter to the
Consolidation Officer.
It migl_it be mentioned here that when the
proceedings for revision of the records were started, while the appellant filed his objections, respondents 4 & 5 seem to have kept quiet
and filed no objections at all. In fact under s. 9 (2)
of the U. P.
Consolidation of Holdings Act, 1953, the respondents cou\d have filed
their objections, if they were aggrieved by the entries made on the
basis of the compromise. Sub-section (2) of s. 9 of the U.P. Cousolidation of Holdings Act runs thus :
"Any person to wh~ a notice under sub-section ( 1)
has been sent, or any other person interested may, within
21 days of the receipt of notice, or of the publication under
sub-section (1), as the case may be, file, before the AssisI
...
•
tant Consolidation Officer, objections
in respect
thereof
. \
disputing the correctness or nature of the entries in the re-
....,_
cords or in the extract furnished therefrom, or in the Statement of Principles, or the need for partition."
This is a very important circumstance which speaks volumes against
the conduct of the respondents which will be referred to in
detail
in a later part of our judgment and seems to have been completely
brushed aside by all the Courts.
The Consolidation Officer to whom the dispute was referred, by
his order dated July 27, 1964, framed a number of issues, and after
trying the suit, removed the name of the appellant Kale from Khatas
5 & 90 and substituted the names of appellant No. 2 Musamat Tikia
and those of respondents 4 & 5.
We might also mention here that
)-
for the first time respondents 4 & 5 raised a dispute before the Consolidation Officer denying that the appellant Kale was the grandson
of Lachman.
The Consolidation Officer framed an issue on
this
question and after taking evidence clearly found that the objection
raised by respondents 4 & 5 was absolutely groundless and that the
appellant Kale was undoubtedly the grandson of . Lachman.
The
Consolidation Officer pointed out that even
before the Panchayat
Adalat as also in the mutation petition which
was filed before the
Naib Tahsildar respondents 4 & 5 never disputed that the appeHant
Kale was the grandson of Lachman being
the son of his daughter
Musamat Tikia who is appellant No. 2.
Thereafter the appellant and the respondents 4 & 5 filed an appeal
before the Settlement Officer who by his order dated November 28,
1964, restored the mutation made by the Naib Tahsildar on the basis
·J' ·
of the compromise, namely the appellant was mutated in respect of
Khatas Nos.
5 & 90 and respondents 4 & 5 in respect of Khatas
Nos. 53 & 204.
Thereaftter respondents 4 & 5 filed a revision petition before the
Deputy Director of Consolidation who by his order dated January
22, 1965, reversed the order of the Settlement Officer and expunged
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KALE v. DIRECTOR CONSOLIDATION (Fazal AU, J.)
20 7
the name of the appellant Kale from Khatas Nos.
5 & 90 and recorded the name of respondent No. 5 Musamat Ram Pyari in respect
of these Khatas on the ground that she was the sole tenure holder in
respect of those Khatas.
Therefater the appellant Kale and his mother
Musamat Tikia
appellant No. 2 filed a writ petition in the Allahabad High
Court
against the order of the Deputy Director of Consolidation.
The writ
petition was heard in the first instance by a Single Judge who
dismissed the petition upholding the order of the Deputy Director of
Consolidation. The appellant then filed a special appeal to the Division Bench of the Allahabad High Court which also
affirmed the
judgment of the Single Judge and dismissed the appeal-hence this
appeal by special leave.
In support of the appeal Mr. Garg appearing for the appellants
submitted two points of law before us.
In the first place he argued
that the grounds on which the Courts below have not given effect to
the family arrangement arrived at between the parties in 1956 culminating in the mutation in 1957 are not legally sustainable. 'fhe
High Court took an erroneous vi_ew of the law in rejecting the compromise on the ground that it was not registered.
It was argued that
an oral family arrangement bad already taken place earlier and a petition before the Naib Tabsildar was merely for the information of the
Court for the purpose of mutation of the names of the parties in pursuance of the compromise and, therefore, no question of registration
of the compromise in this case arose.
Secondly it was contended that
even if the compromise was unregistered it would undoubtely operate
as a c)ear estoppel against the respondents 4 & 5 who having taken
benefit thereunder and having remained in possession of the lands for
more than seven years cannot be allowed to revoke the compromise.
Mr. Sharma learned counsel appearing for the respondents raised
the following contentions before us :
(1) that the appellants never pleaded any oral family
arrangement;
{2) that the family arrangement relied upon by the appellants was not bona fide and was fraudulent as
the
consent of respondents 4 & 5 was obtained by fraud
or undue influence;
.( 3) that the appellants themselves gave a complete
go
bye to the family arrangement in the. case which they
made out before the Revenue
Courts
and
have
merely taken advantage of a stray observation made
by the Deputy Director of Consolidation;
( 4) that the petition filed before the
N aib
Tahsildar
embodied and as such the terms and conditions of
the compromise was compulsorily registrable under
the Registration Act, and being unregistered it was
inadmissible in evidence;
{5) that at any rate the family arrangement
was
not
proved by the appellants as a fact;
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SUPREME COURT REPORTS
(1976) 3 S.C.R.
( 6) that the dectrine of estoppel would not apply
because the family arrangement
being
compulsorily
registrable there can be no
estoppel
against
the
statute; and
(7) that the findings of the Revenue Courts being essentially findings of fact, this Court would not interfere,
unless there was a sufficient error of law apparent on
. the face of the record.
Before dealing with the respective contentions put forward by the
parties, we would like to discuss in general the effect and value of
family arrangements entered into between the parties with a view to
resolving disputes once for all.
By virtue of a family settlement or
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arrangement members of a family des.cending from a common ancestor or a near relation seek to sink their differences
and disputes,
settle and resolve their conflicting claims or disputed titles once for all
in order to buy peace of mind and bring about complete harmony and
goodwill in the family.
The family arrangements are governed by a
special equity peculiar to themselves
and
would
be
enforced
if
honestly made.
In this connection, Kerr in his valuable treatise "Kerr
O
on Fraud" at p. 364 makes the following pertinent observations regard-·
ing the nature of the family arrangement which may be extracted thus :
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"The principles which apply to the case
of ordinary
compromise between strangers, do not equally apply to the
case of compromises in the nature of family arrangements.
Family arrangements are governed by l) special equity peculiar to themselves, and will be enforced if honestly made,
although they have not been meant as a compromise, but
have proceeded from an. error of all parties, originating in
mistake or ignorance of fact as to what their rights actually
are, or of the. points on which their rights actually depend."
The object of the arrangement is to protect the family from long drawn
litigation er perpetual strifes which mar the unity and solidarity of
the family and create hatred and bad blood between the various members of the family.
Today when we are striving to build up an egalitarian society and are trying for a complete reconstruction of the
society, to maintain and uphold the unity and homogeneity of the
family which ultimately results in the unification of the society and,
therefore, of the entire country, is the prime need of the hour.
A
family arrangement by which the property is equitably divided between
the various contenders so as to achieve an equal distribution of wealth
instead of concentrating the same in the hands of a few is undoubtedly
a milestone in the
adm'nistration of social justice. That is why the·
term "family" has to be understood in a wider sense so as to include
within its fold not only close relations or legal heirs but even those
persons who may have some sort of antecedent title. a sembfance of a
claim or even if they have a spes successionise so that future disputes are
sealed for ever and the family instead of fighting claims inter 5e and
wasting time, money and energy on such fruitle.ss or futik litigation is
able to devote its attention to more constructive work in the larger
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KALE v. DIRECTOR CONSOLIDATION (Fazal Ali, !.)
209
interest of the country.
The Courts have, therefore, leaned in favour
of upholding a family arrangement instead of disturbing the same on
technical or trivial grounds.
Where the Courts find that the family
arrangement suffers from a legal lacuna or a formal defect the rule of
estoppel is pressed into servii:e and is applied to shut out plea of the
person who being a party to family arrangement seeks to unsettle a
settled dispute and claims to revoke the family
arrangement under
which he has himself enjoyed some material benefits.
The law in
England on this point is almost the same.
In Halsbury's
Laws of
England, Vol. 17, Third Edition, at pp. 215-216, the following
apt
observations regarding the essentials of the family settlement and the
principles governing the existence of the same are made :
··A family arrangement is an agreement between m~m
bers of the same family, intended to be generally and reasonably for the benefit of the family either by compromising
doubtful or disputed rights or by preserving the family property or the peace and security of the family by avoiding litigation or by saving its honour.
The agreement may be implied from a long course o[
dealing, but it is more usual to embody or to effectuate the
agreement in a deed to which the term "family arrangement"
is applied.
Family arrangements are governed by principles which
are not applicable to dealings between strangers. The court,
when deciding the rights of parties under family
arrangements or claims to upset such arrangements, cop.siders what
in the broadest view of the matter is most for the interest of
families, and bas regard to considerations which, in dea!ing
with transactions between persons not members of the same
fam;ly. would not be taken into account.
Matters wh'ch
would be fatal to the validity of similar transactions between strangers are not objections to the binding effect of
fam~Jy arrangements".
In other words ·to put the binding effect and the essentials of a
family settlement in a concretised. form, the. matter may be reduced
into the form of the following propositions :
( 1) The family settlement must be a bona fide one so as
to resolve family disputes and rival claims by a fair
c
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and equitable division or allotment of properties betG
(2)
ween the various n1e1nbers of the family;
The said settlement must be
not be induced
by
fraud,
influence;
voluntary and should
coercion
or
undue
(3) The family arrangement may be even oral in which
case no registration is necessary;
( 4) It is well-settled that registration would be necessary
only if the terms of the
family
arrangement
are
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reduced into writing.
Here also, a distinction
should be made between a document containing the
terms and recitals of a family arrangement made
under the document and a mere memorandum prepared after the family arrangement had already been
made either for the purpose of the record or for information of the court for making necessary mutation.
In such a case the memorandum itself does
not create or extinguish any rights in
immovable
properties and therefore does not fall within the mischief of s. 17 (2) of the Registration Act and
is,
therefore, not compulsorily registrable;
(5) The members who may be parties to
the
family.
arrangement must have some antecedent title, claim
or interest even a possible claim in
the
property
which is acknowledged by the parties to the settlement.
Even if one of the parties to the settlement
has no title but under the arrangement the
other
party relinquishes all its claims or titles in favour of
such a person and acknowledges him to be the sole
owner, then the antecedent title must be assumed and
the family arrangement will be upheld and the Courts
will find no difficulty in giving assent to the same;
( 6) Even if bona fide disputes, present or possible, which
may not involve legal claims are settled by a bona
fide family arrangement which is fair and equitable
the family arrangement is final and binding on the
parties to the settlement.
•
The principles indicated above have been clearly enunciated and
/-
adroitly adumbrated in a long course of decisions of this Court as also
·
those of the Privy Council and other High Courts, which we shall
discuss presently.
F
In Lala Khu1111i Lal & Ors. v. Kunwar Gobind Krishna Narain
•
H
and Anr.( 1) the statement of I.aw regarding the essentials of a valid
settlement was fully approved of by their Lordships of
the
Privy
Council.
In this connection the High Court made
the
foHowing
observations which were adopted hy the Privy Council :
The learned judges say as follows :
"The true character of the transaction appears to us to
have been a settlement between the several members of the
family of thek disputes, each one relinquishing all claim in
respect of all property in dispute other than that falling ILl
his share, and recognizing the right of the others as
they
had previously asserted it to the portion allotted to
th~m
respectively. It was in this light, rather than. as confemng
a new distinct title on each other, that the parties themselves
seem to have regarded the arrangement, and we think that
(I) L R. 38 I. A. 87. 102.
•
.,,
•
KALE v. DIRECTOR CONSOLIDATION (Fazal Ali, !.)
211
it is the duty of the Courts to uphold and give full effect to
such an arrangement."
Their Lordships have no hesitation in adopting that
view."
This decision was fully endorsed by a later decision of the Privy
Council in Mt. Hiran Bibi and others v. Mt. Sohan Bibi(!).
In Sahu Madho Das and others v.
Pandit Mukand Ram and
another(') this Court appears to have amplified the doctrine of validity of the family arrangement to the farthest possible extent, where
Bose, J ., speaking for the Court, observed as follows :
"It is well settled that compromise or family arrangeA
ment is based on the assumption that there is an antecedent
c
titte of some sort in the parties and the agreement acknowledges and defines what that title is, each party relinquishing
all claims to property other than that falling to his share and
recognising the right of the others, as they had previously
asserted it, to the portions allotted to them respectively. That
explains why no conveyance is required in these cases to
pass the title from the one in whom it resides to the person
D
receiving it under the family arrangement.
It is assumed
that the title claimed by the person receiving the property
under the arrangement had always resided in him or her so
far as the property falling to his or her share is concerned
and therefore no conveyance is necessary. But,
in our
opinion, the principle can be carried further and so strongly
do the Courts lean in favour of family arrangements that
E
ocing about harmony in a family and do justice to its various
members and avoid in anticipation, future disputes which
might iuin them all, and we have no hesitation in taking the
next step (fraud apart) and upholding·
an
arrangement
under which one set of members abandons all claim to all
title and interest in all the properties in dispute and acknowledges that the sole and absolute title to all the properties
F
resides in only one of their number (provided he or she had ·
claimed the whole and made such an assertion of title) and
are content to take such properties as are assigned to their
shares as gifts pure and simple from him or her, or as a conveyance for consideration when consideration is present."
In Ram Charan Das v. Girjanandini Devi & Ors. (3), this Court
G
observed as follows :
"Courts give effect to a family settlement upon the broad
and general ground that its object is to settle existing or
future disputes regarding property amongst members of
a
family.
The word 'family' in the context is not to be understood in a narrow sense of being a group of persons who
__ are r:cognised in law as having a right of succession or
H
(I} A.LR. 1914 P. C. 44.
(2) [1955] 2 S.C.R. 22, 42-43.
(3) [1965] 3 S.C.R. 841,
850-851.
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[1976] 3 S.C.l'..
having a claim to a share in the property in dispute ....... .
The consideration for such a settlement, if one may put it
that way, is the expectation that such a settlement will result
in establishing or ensuring amity
and
goodwill
amongst
p•rsons bearing relationship with one another.
That consideration having been passed by each of the disputants the
settlement consisting of recogintion of the right asserted by
each other cannot be permitted to be impeached thereafter."
In Tek Bahadur Bhujil v. Debi Singh Bhujil and Others(!) it was
pointed out by this Court that a family arrangement could be arrived
at even orally and registration would be required only if it was reduced
into writing.
It was also held that a document which was no more
than a memorandum of what had been agreed to
did
not require
registration.
This Court had observed thus :
"Family arrangement as such can be arrived at orally.
Its terms may be recorded in writing as a memorandum o!
what had been agreed upon
between
the
parties.
The
memorandum need not be prepared for the purpose of being
used as a document on which future title of the parties be
founded. It is usually prepared as a record of what had
been agreed upon so that there be no hazy notions about it in
future.
Jt is only when the
parties
reduce
the
family
arrangement in writing with the purpose of using that writing
as proof of what they had arranged and, where the arrangement is brought about by the document as such,
that the
document would require registration as it is
then that it
would be a document of title declaring for future what rights
in what properties the parties possess."
Similarly in Maturi Pullaiah and Anr. v. Maturi Narasimham and
Ors. (2) it was held that even if there was no conflict of legal claims
but the settlement was a bona fide one it could be sustained by the
Court.
Siffiilarly it was also held that even the disputes based upon
ignorance of the parties as to their rights were sufficient to sustain the
family arrangement.
In this connection
this
Court
observed
as
follows :
"It will be seen from the said passage that a
family
arrangement resolves family dispntes, and that even disputes
based npon ignorance of parties as to their rights may afford
a sufficient ground to sustain it.
•
•
*
•
Briefly stated, though conflict of legal claims in pNie'enti
or in future is generally a condition for the validity of a
family arrangement, it is not necessarily so.
Even bona fide
disputes, present or possible, which may not involve legal
claims will suffice.
Members of a joint Hindu family may,
to maintain peace or to bring about harmony in the family,
-
--- ---- ----------
(1) A.T.R. 1966 S.C. 292. 295.
(2) AlR 1966!S.C. 1836·
•
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KALE I'. D;R'ECTOR CONSOLJDATION (Fazal Ali, J.)
213
enter into such a family arrangement. If such an arrangement is entered into bona fide and the terms
thereof are
fair in the circumstances of a particular case, Courts
will
more readily give assent to such an arrangement
than
to
avoid it."
·
In Krishna Bihari/al v. Gulabchand and others(') it was pointed
A
om tha: the word 'family' had a very w .ac connotaMn and cou!d not
B
•
be confined only to a group of persons who were recognised by law
as hav:ng a right of succession or clacming to have
a
share.
The
Court then observed :
"To consider a settlement as a family arrangement, it
is not necessary that the parties to the compromise should all
belong to one family.
As observed by this Court in Ralll
Charan Das v. Girjanandini Devi and Ors.-[1965] 3 SCR
841 at pp. 850 & 851-the word "family" in the context
of a family arrangement is not to be understood in a narrow
sense of being a group of persons who are recognised
in
law as having a right of succession or having a claim to a
share in the property in dispute. If the dispute which
is
settled is one between near relations then the settlement of
such a dispute can be considered as a family arrangement--
see Ramcharan Das's case.
The courts lean strongly in favour of family arrangements
to bring about harmony in a family and do justice to its
various members and avoid in anticipation future disputes
which might ruin them all."
In a recent decision of this Court in S.
Shanmugam Pillai and
others v. K. Shanmugam Pillai & Others(") the entire case law was
discussed and this Court observed as follows :
"If in the interest of the family proj:lerties or family peace
the close relations had settled their disputes amicably, this
Court will be reluctant to disturb the same.
The courts
generally lean in favour of family arrangements.
*
*
*
*
Now turning to the plea of family arrangement,
as
observed by this Court in Sahu Madho Das and Others v.
Pandit Mukand Ram and Another-[19551 2 SCR 22the courts lean strongly in favour of family
arrangements
that bring about harmony in a family and do justice to its
various members and avoid, in anticipation, future disputes
which might ruin them all.
As observed in that case the
family arrangement can as a matter of law be inferred from
a long course of dealings between the parties.
In Maturi Pullaiah and Another v. Maturi Narasimham
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and Others-AIR, 1966 SC 1836- this Court held that alH
though conflict of legal claims in praesenti or in future
is
-- --
-
(I) [1971] Supp. SCR 27, 34.
r2) [197312sec112.
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[1976] 3 S.C.R.
generally a condition for the validity of family arrangements, it is not necessarily so.
Even bona fide
dispute,;
present or possible, which may not involve legal claims
would be sufficient.
Members of a joint Hindu family may
to maintain peace or to bring about harmony in the family,
enter into such a family arrangement. If such an agreement is entered into bona fide and the terms thereto are fair
in the circumstances of a particular case, the courts would
more readily give assent to such an
agreement than to
avoid it."
Thus it would appear from a review of the decisions analysed
above that the Courts have taken a very liberal and broad view of the
validity of the family settlement and have always tried to uphold it
and maintain it.
The central idea in the approach made by the
Courts is that if by consent of parties a matter has been settled, it
should not be allowed to be re-opened by the parties to the agreement
on frivolous or untenable grounds.
A full bench of the Allahabad High Court in Ramgopal v. Tulshi
Ram and another(') has also taken the view that a family arrangeD
ment could be oral and if it is followed by a petition in Court containing a reference to the arrangement and if the purpose was merely
to inform the Court regarding the arrangement, no registration was
necessary.
In this connection the full bench adumbrated the following propositions in answering the reference :
"We would, therefore return the reference with a stateE
ment of the following general propositions :
F
G
With reference to the first question :
(I) A family arrangement can be made orally.
(2) If made orally, there being no document, no question of registration arises.
With reference to the second question :
(3) If though it could have been made orally, it was in
fact reduced to the form of a
"document'',
registration
(when the value is Rs. 100 and upwards) is necessary.
( 4) Whether the terms have been "reduced to the form
of a document" is a question of fact in each case to be determined upon a consideration of the nature and phraseology
of the writing and the circumstances in which and the purpose with which it was written.
(5) If the terms were not "reduced to the form of a
document", registration was not necessary (even though the
valne is Rs. 100 or upwards); and, while the writing cannot
be nsed as a piece of evidence for what it may be worth,
H
e.g. as corroborative of other evidence or as an admission of
the transaction or as showing or explaining condnct.
(l) AIR 1928 All. 641, 649.
·)II
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KALE v. DIRECTOR CONSOLIDATION (Fazal Ali, J.)
215
(6) If the terms were "reduced to the form of a document" and, though the value was Rs. 100 or upwards, it was
not registered, the absence of registration makes the document inadmissible in evidence and is fatal to proof of the
arrangement embodied in the document."
Similarly in Sita/a Baksh Singh and others v. Jang Bahadur Singh
and other (') it was held that where a Revenue Court merely gave
effect to the compromise, the order of the Revenue Court did not
require registration.