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TMI Blog2000 (11) TMI 1246X X X X Extracts X X X X X X X X Extracts X X X X ..... adopt the cause title as given in O.S.A.No.237 of 2000. The appellant as plaintiff, originally instituted the suit as plaintiff as against the father by name Chakrapani Reddiar, since dead, as 1st defendant and his brother by name Kulasekaran as 2nd defendant. Pending suit, the 1st defendant died and the defendants 2 to 7 were recorded as legal representatives of the 1st defendant as per the Order dated 18.3.1987 in Application No.4137 of 1986. 3. The appellant/plaintiff filed the said suit praying the Court as the first relief to pass a decree declaring that the Memorandum dated 29.12.1974 as void, illegal and unenforceable. However, pending suit, the appellant on 9.1.2000, filed a memo to the effect that he is not pressing the above said first relief as he felt the same as unnecessary. 4. The other prayers made by the appellant in the plaint are, to declare that the properties described in the Schedule 'A' to 'D' are joint family properties available for general partition and to allot 1/3rd share in all such family properties and for other reliefs. In substance, the plea of the appellant is that the family continues to be joint even now and that for convenie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egistered and unstamped document which is partly a partition deed and partly a settlement deed. 7. The learned single Judge thought it fit to consider at that stage the admissibility of the document in question. The learned single Judge came to the conclusion that the document in question is an unregistered partition deed and the same can be admitted in evidence only for collateral purposes. 8. Aggrieved by this order of the learned single Judge, the appellant has filed the above appeal. The learned counsel appearing for the appellant put forth the following submissions: (a.) The document in question is an unstamped and unregistered partition-cum-settlement deed and the same cannot be admitted in evidence and/or looked into for any purpose in view of the clear provisions in the Indian Stamp Act and the Indian Registration Act. (b.) The learned single Judge has though in the earlier part of the judgment has took note of the fact that it is an unstamped document, in the later part of the judgment while considering the point in issue, has only considered the legal effect of non-registration. (c.) In the impugned order, atleast in three places, the learned single Ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocument, and therefore, there could be no partition, but only a settlement. 12. The next aspect to be considered and dealt with is as to who can be the parties to the family arrangement or in other words, how the term 'family' has to be understood while understanding the family arrangement, 13. In Ram Charan Das v. Girja Nandini Devi and others , the Supreme Court held that the word family has not to be understood in a narrow sense of being group of persons whom the law recognizes as having a right of succession or having a claim to a share in the disputed property. In fact, in a subsequent ruling reported in M/s. D.N. Roy v. State of Bihar, the Supreme Court held that if the dispute is settled between near relations, then the settlement of dispute can be considered as a family arrangement. 14. A learned single Judge of this Court in a ruling reported in Thirumathi Ramayammal v. Thirumathi Muthammal, 1974 (2) M.L.J. 34 ruled that, .......it is well established that a party who takes benefit under a family settlement need not necessarily be shown to have, under the law, a share in the property and all that is necessary to show is that the parties are relat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a condition for the validity of the 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 family may, to maintain peace or to bring about harmony in the family, enter into such a family arrangement. If such a family arrangement is entered into bona fide and the terms thereof are fair in a circumstance of a particular case, Courts will more readily give accent to such an agreement than to avoid it. Family arrangements are bring about harmony in a family and do justice to its various members and avoid, in anticipation, future disputes which might ruin them all will be favoured. 17. Even disputes based upon ignorance of the parties as to their rights were sufficient to sustain the family arrangement Pullaiah v. Narasimhan . To sum up: To effect a family arrangement all that is necessary is that the parties must be related to one another in some way and have a claim or a possible claim to the property or even a semblance of a claim or spes successions or even on some other ground as, say, affection or ignorance of the parties of their rights and with the purpose or o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h, not having been previously executed by any person, is executed out of India on or after that day, relates to any property situate, or to any matter or thing done or to be done, in India and is received in India: Provided that no duty shall be chargeable in respect of- (1) any instrument executed by or on behalf of, or in favour of the Government in cases where, but for this exemption, the Government would be liable to pay the duty chargeable in respect of such instrument; (2) any instrument for the sale, transfer or other disposition, either absolutely or by way of mortgage or otherwise, of any ship or vessel, or any part, interest, share or property of or in any ship or vessel registered under the Merchant Shipping Act, 1894, or under Act XIX of 1838, or the Indian Registration of Ships Act, 1841 (X of 1841), as amended by subsequent Acts. * For Banganapalle read this: as the first day of December, 1948 , GO Ms. No.2722 Rev., dated 16th November, 1948. For Pudukottai read this: as the 12th day of August, 1948 , GO Ms. No.1872, Rev dated 5th August, 1948. 21. Article 45 to the Schedule 1 to the Indian Stamp Act, prescribes the stamp duty payable. 22. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ral one or is to establish directly title to the immovable property sought to be conveyed by the document. But by the simple device of calling it a collateral purpose , a party cannot use the unregistered document in any legal proceedings to bring about indirectly the effect which it would have had if registered. Then the Court quoted a passage from the ruling reported in which reads as under:- The expression collateral transaction in the proviso to Section 49, Registration Act, is not used in the sense of an ancillary or a subsidiary transaction to a main or principal transaction. The transaction as recorded could be a particular or specific transaction. But it would be possible to read in that transaction what may be called the purpose of transaction and what may be called a collateral purpose; the fulfilment of that collateral purpose would bring into existence a collateral transaction, a transaction which may be said to be a part and parcel of the transaction but nonetheless a transaction which runs together with or an parallel lines with the same. A memo of partition of immovable property belonging to a Hindu joint family which is required to be registered bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f reciting an already completed oral partition and were not intended by the parties to form an integral and essential part of the process of dividing the properties and to be the only evidence of and to be the formal instrument of partition superseding and embodying the oral bargain and were certainly not intended as the sole repository of the arrangement of partition arrived at by them constituting the bargain between the parties. 26. The next question would be what is the position is the said document is not only registered, but it is also not stamped i.e. unstamped. Section 35 of the Indian Stamp Act reads thus: S. 35. Instruments not duly stamped inadmissible in evidence, etc.--No instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by law or consent of parties authority to receive evidence, or shall be acted upon, registered or authenticated by any such person or by any public officer, unless such instrument is duly stamped. Provided that- (a) any such instrument not being an instrument chargeable with a duty not exceeding ten naye paise only, or a bill of exchange or promissory note, shall; subject to all just ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the unstamped and unregistered document and if such evidence is admitted, it amounts to acting on the unstamped document, which is against Section 35 of the Indian Stamp Act,. 29. The next question is how a family arrangement can be effected and what are the aspects to be considered or noted in testing the validity and binding nature of a family arrangement. The family arrangement can even be made orally and in which obviously the question of registration does not arise. What is required to be seen is whether the family settlement is a bona fide one so as to resolve family disputes and rival claims at a fair and equitable decision or allotment of properties between the various members of the family. Similarly, the family arrangement should not be result of any fraud or undue influence etc. played on the member/members of the family. In other words such a family arrangement must be voluntary and entered into by the parties on their own accord and free will. It is only when the family arrangement reduced into 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 docu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th a statement of the following general propositions: With reference to the first question: (1) 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 ₹ 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 value is ₹ 100 or upwards); and, while the writing cannot be used as a piece of evidence for what it may be worth, e,g. as corroborative of other evidence or as an admission of the transaction or as showing or explaining conduct. (6) If the terms were reduced to the form of a document and, though the value was ₹ 100 or upwards, it was not r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e as the same in the nature of declaring the title of the parties is also not stamped, whether it can be looked into by the Court for collateral purposes. Section 35 of the Stamp Act has already been extracted by us. The Courts in various rulings, which we have already referred, interpreted the Section to mean that if a family arrangement which is compulsorily registrable is not stamped, then the same cannot be looked into for any purpose including for collateral purposes. 35. As far as the present case is concerned, while the learned counsel for the appellant would contend that the document in question is partly a partition deed and partly a settlement deed, the respondents have taken a stand in the written statement that it is a memorandum of partial partition and now before this Court in the appeal filed by the respondents, they claim the document in question as a family arrangement. In the document in question, not only that the plaintiff and defendants 1 and 2 partitioned among themselves some properties, but also had allotted certain immovable properties to the sisters of the plaintiff and the 2nd defendant. The document reads that they entered into an arrangement wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The arrears of rent due from the tenants shall be recoverable by the party to whom the property to which arrears relate and have been allotted and similarly the rent paid in advance by the tenants shall be adjusted against the rent payable by the party and also any Court decree obtained for the arrears of the rent due in respect of properties allotted to each one of them. Liabilities of the family consisting of cash credits in the books of account relating to the parties hereto which have arisen consequent to earlier partial partition occurred thereon and which stands credited in the books of the family in their respective names have been duly considered and taken into account in the manner of the allocation of various properties in this partial partition. It is hereby affirmed by the Kartha, Coparcener No.1 and Coparcener No.2 that in view of the properties allotted to each one of them, they do not have any claim or interest on the amounts standing to their credit in the Oil Mundy and money lending books of account. (G) The further recitals are whereas the parties hereto have divided the immovable properties........ (H) The document reads this partial partition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 33; (iv) Ram Rattan v. Parma Nand (v) Achutaraman v. Jagannadham, AIR 1933 Mad. 117 40. The next question may arise whether the rule of estoppel will apply and that inasmuch as the appellant was a signatory to the document in question, can it be said that it would be binding on him as it would operate as an estoppel. Such a plea of estoppel can be applied only were the defect in the document is in the nature of formal defect or legal lacunae. Say for instance, a case where the document is stamped but not registered. But, however in a case where the document is not even stamped as required under the Indian Stamp Act, the defect cannot be said to be the formal legal defect or merely a lacuna, as otherwise, it would go against the very provisions of the Indian Stamp Act. 41. We hold that the document in question is being an unstamped and unregistered, the same cannot be looked into for any purpose. Similarly, oral evidence cannot be let in about the contents of the said document. 42. To sum up the legal position (I) A family arrangement can be made orally. (II) If made orally, there being no document, no question of registration arises. (III) I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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