By- Ritesh Raj
INTRODUCING FAMILY ARRANGEMENT TO SECTION 10 OF TPA
Section 10 of the Transfer of Property Act, 1882 (hereinafter ‘TPA’) renders the condition of absolutely restraining alienation in a transfer void. Though it does not mention partial restraints, courts have consistently held that a partial restraint on alienation would be valid under Section 10.[1] The Section also mentions an exception (to lease agreements) and a proviso (to married women who are not Hindu, Muslim, or Buddhist) which are irrelevant to the purpose of this piece.
On its own, the section is precise, that is, it applies only to ‘transfers’. However, property section’s reliance on the principle of a free circulation of property complicates matters. This is because the application of Section 10 is dependent on what is meant by “transfer” under Section 5 of TPA. There are many agreements that the definition excludes, but Section 10’s principles aim to include them. A difference emerges between agreements that can be construed as a transfer (which are limited) and agreements on which the courts apply Section 10 (comparatively wide). Family settlements and partition deeds come under the second type (henceforth ‘family arrangements’).[2] Family arrangement has been defined as an informal agreement among family members, usually to distribute property in a manner, other than what the law provides for.[3] This does not mean that the agreement can be against the law itself. Thus, though, they are not strictly “transfers” under Section 5, the courts have applied Section 10 principles to ensure that members are not restrained from transferring their property. The courts have done so based on justice, equity, and good conscience.[4] These are general principles of law that can be construed differently by different courts. Thus, its application has been inconsistent.
This piece argues that family arrangements should be added as a sub-section under section 10 of the TPA. To that end, the first part explained family arrangements in the background of Section 10 of TPA. The second part demonstrates the evolution of Section 10 beyond transfers. It shows how courts started applying it to family arrangements. The third part provides for three issues in applying Section 10 principles based on general principles. It recommends adding it as a sub-section under Section 10 as a solution in the final part and concludes.
EVOLUTION OF SECTION 10 BEYOND TRANSFERS
The application of Section 10 principles to family arrangements has not been a thing for eternity. It was rarely applied before independence. In 1914, the Privy Council held that a family settlement cannot be construed as a transfer. This was reiterated in Basangowda Virupaxgowda v. Irgowdati Kallangowda, where it was held that Section 10 must be construed strictly, and thus, it cannot apply to cases of family arrangements. Its application was further limited in Hanuman Sahu and Ors v. Abbas Bandi Bibi, where the court said that even the principles of Section 10 cannot apply where the TPA itself does not apply. However, it made an exception to general principles of law. It stated that restraints in family arrangements can only be considered through the lens of general principles (and not some specific section principles). The question of whether the principles of Section 10 can be construed as general principles was not argued. From the judgment, it seems the court presumed that the principles of a specific section (Section 10 in the present case) cannot be general in nature.
However, the scenario of not applying Section 10 (or principles so to say) changed in 1932 when the Privy Council applied its principles in a family arrangement case. Though the council ruled that family arrangement cases can only be decided based on “justice, equity and good conscience”, it nevertheless applied Section 10 principles. This was reiterated in Ram Nath v. Nanak Chand and Ors and Prithmi Chand Chandu Mal v. Sundar Das Sital Mal.[5]
The council never said that applying principles of Section 10 is tantamount to applying the general principles, but this is what has been understood by the courts, and this is what is being followed. It started with P.V.S. Vencatachellum v. P.V.S. Kabalamurthy Pillai, where the Madras HC applied principles of Section 10 citing Prithmi Chand v. Sundar Das. It said that though the section does not apply “in terms” its principles can still be applied.
Another process was followed by the Bombay HC. It did not apply Section 10 principles based on some broad general principles. Rather, it applied the section itself by interpreting the definition of transfer in Section 5 to include even partition deeds. To do so, it considered the legislation’s object. Though it is debatable whether partition can be construed as a transfer, the procedure for applying the section is noteworthy. Instead of applying Section 10 principles, which can be construed differently by different courts and may lead to misapplication, the court applied the Section itself.
This procedure, however, never became a judicial standard, and courts continue to apply Section 10 or its principles in different ways. Though, its application is consistent.
[1] Poonam Pradhan Saxena, Mulla on the Transfer of Property Act (13th edn, LexisNexis 2018) ch 10.5.
[2] For the purpose of this piece, family arrangements do not include after-death agreements like wills, which are governed by separate laws.
[3] Thomas Reuters, Black’s Law Dictionary, (Bryan A Garner, 7th edn, 1999) 620.
[4] Saxena (n 2).
[5] Prithmi Chand Chandu Mal v Sundar Das Sital Mal AIR 1946 Peshawar 12.
(Ritesh Raj is a law undergraduate at National Law School of India University. The author may be contacted via email at ritesh.raj@nls.ac.in).
Cite as: Ritesh Raj, Over Application of Section 10: The Case of Family Arrangement in India, 2023, 14 August 2023) <https://rmlnlulawreview.com/2023/08/14/over-application-of-section-10-the-case-of-family-arrangement-in-india/> date of access.
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