Bombay High Court
Raivathari Madhupati Singhania ... vs Madhupati Vijaypath Singhania ... on 21 August, 2015
Bench: G.S. Patel
NMS372-15-SINGHANIA-F.DOC
Shephali
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
NOTICE OF MOTION NO. 372 OF 2015
IN
SUIT NO. 201 OF 2015
1. Raivathari Madhupati Singhania,
aged 18 years, Resident of Singapore
having his address at 10, Ewart Park,
Singapore 279 775
2. Ananya Madhupati Singhania,
aged 29 years, Resident of Singapore
having her address at 10, Ewart Park,
Singapore 279 775
3. Rasaalika Madhupati Singhania,
aged 26 years, Resident of Singapore
having her address at 10, Ewart Park,
Singapore 279 775
4. Tarini Madhupati Singhania,
aged 20 years, Resident of Singapore
having her address at 10, Ewart Park,
Singapore 279 775
Through their Constituted Attorney ... Applicants/
Shri Devkumar Aggarwal Plaintiffs
versus
1. Madhupati Vijaypat Singhania,
aged 57 years, Resident of Singapore
having his address at 10, Ewart Park,
Singapore 279 775
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2. Anuradha Madhupati Singhania,
aged 54 years, Resident of Singapore
having her address at 10, Ewart Park,
Singapore 279 775
3. Dr. Vijaypat Kailashpat Singhania,
aged about 76 years, Indian Inhabitant
R/O. Kamla Cottage, Juhu, Mumbai, also
at 59, B Desai Road, Mumbai - 400 026
4. Raymond Limited, a Company
incorporated under the provisions of
Companies Act, 1956 having its address at:
Corporate Office: Mahindra Towers, 2nd
Floor, B Wing, Pandurang Budhkar Marg,
Worli, Mumbai - 400018
ig ... Defendants
A PPEARANCES
FOR THE PLAINTIFFS Ms. Sharmila Deshmukh, with Ms. Rupali
Dixit.
FOR DEFENDANTS NOS. 1 Ms. Nivedita Sharma, i/b Mr. Rakesh G.
&2 Jain.
FOR DEFENDANT NO. 3 Mr. Viraag Tulzapurkar, Senior
Advocate, with Mr. Nikhil
Sakhardande, & Mr. Suraj Juneja, i/b
M/s. Wadia Ghandy & Co.,
FOR DEFENDANT NO. 4 Mr. Janak Dwarkadas, Senior Advocate,
with Mr. Kunal Dwarkadas i/b M/s.
Vigil Juris.
CORAM : G.S.Patel, J.
JUDGMENT RESERVED ON : 29th July 2015
JUDGMENT PRONOUNCED ON : 21st August 2015
JUDGMENT:
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1. Seventeen years ago, on 30th December 1988, Madhupati and
Anuradha Singhania, Defendants Nos. 1 and 2, signed a document
styled as a 'Memorandum of Family Settlement' ("MoFS") with
Madhupati Singhania's father, Dr. Vijaypat Singhania, the 3rd
Defendant. By this document,1 Madhupati and Anuradha Singhania
gifted, transferred or otherwise relinquished rights over several
properties, both movable and immovable, while retaining others.
The document says they did so to avoid differences of 'opinion and
approach' between Madhupati Singhania and his father, and matters
of 'tension and discord' in their respective management styles. This
is a reference to the business conglomerate then under the
stewardship of Dr. Vijaypat Singhania. The document says that
Madhupati and Anuradha Singhania desired to emigrate. The so-
called severance is attributed to these factors.
2. Madhupati and Anuradha Singhania signed the MoFS not
only for themselves, but also for their four children, the Plaintiffs, all
minors at the time. It is not in dispute that after the execution of the
MoFS, Madhupati and Anuradha Singhania migrated to Singapore,
where they have lived since with their four children, the Plaintiffs. I
will leave aside for the moment Madhupati Singhania's claims to
having been 'thrown out of the family, the business and the country
itself' and to having been forced to eke out something akin to a
subsistence existence, a charge vehemently denied by his father, Dr.
Vijaypat Singhania, who claims that the Singapore lifestyle was
significantly more than comfortable and counted among its many
embellishments a yacht and a sports car. Madhupati Singhania also
claims to have kept from his children the fact of the MoFS and 'the
At page 41 of the plaint.
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truth'. He did so to save them from trauma and from adversely
affecting their education. He only revealed it to them when the
youngest of the four Plaintiffs turned 18. Plaintiff No.2 is the eldest
of the four Plaintiffs. She turned 18 on 11th December 2003.
Plaintiffs Nos. 3 and 4 attained majority on 5th July 2006 and 12th
October 2012 respectively. Plaintiff No. 1, however, turned 18 on
14th May 2014. This disclosure is said to have been made by
Madhupati Singhania's email of 3rd November 2014 to his children. 2
The suit was filed on 30th January 2015.
3. The Plaintiffs say that the MoFS signed by their parents
effected impermissible alienations of their properties, their shares in
joint and ancestral properties and their shares in an HUF; that these
alienations were purportedly made during the minority of the
Plaintiffs; and that none of these alienations were of legal necessity
or for their benefit or evident advantage. These alienations are,
therefore, void. On this basis, the Plaintiffs seek, firstly, a disclosure
on oath of the current status of the assets mentioned in the MoFS;
and, secondly, an injunction restraining all the Defendants
(including not only the Plaintiffs' parents, Defendants Nos. 1 and 2,
but also Defendant No. 4, Raymond Ltd, a public limited listed
company with several institutional shareholders) from 'dealing with,
disposing of, alienating, encumbering or parting with possession' of
the assets mentioned in the MoFS.
4. I have heard Ms. Deshmukh, learned Counsel for the
Plaintiffs, Mr. Viraag Tulzapurkar, learned Senior Counsel for the
3rd Defendant and Mr. Janak Dwarkadas, learned Senior Counsel
Page 164 of the Notice of Motion paperbook.
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for the 4th Defendant at some length. I have also briefly heard Ms.
Nivedita Sharma, learned Counsel for Defendants Nos. 1 and 2. Ms.
Sharma attempted to mount what appeared to me to be a wholly
independent attack on the MoFS, contending that it was void ab
initio, non est, vitiated by undue influence and so on. This was
clearly an attempt by Madhupati and Anuradha Singhania to piggy
back their case on the Plaintiffs' cause. For 17 years, Madhupati and
Anuradha Singhania have kept quiet. They have not once assailed
the MoFS. Even today they have filed no suit. Their cause of action,
if there be any, in Ms. Sharma's presentation of it, is on a wholly
distinct footing. They claim to have been coerced and browbeaten
into signing the MoFS. The Plaintiffs' case is distinct: they claim an
inherent illegality and statutory violation in the terms of the MoFS.
Indeed, Ms. Deshmukh was very careful, and in my view quite
rightly, to distance herself from the uncontrolled diatribes and
broadsides launched on behalf of Madhupati and Anuradha
Singhania. Those seem to me to have had more to do with the saucy
attendant publicity than anything else: as long on gossip as they were
short on law. Indeed, that entire line of argument, though said to be
in support of the Plaintiffs, actually undermined the Plaintiffs'
cause. The Plaintiffs claim to have been once, a long time ago, been
done a disservice by their parents. I saw no reason to let the parents
do so a second time.
5. On a careful consideration of Ms. Deshmukh's case, I am not
persuaded that a sufficiently strong prima facie case has been made
out for reliefs sought, or that the balance of convenience favours the
Plaintiffs. I am also not convinced that the Plaintiffs' discovery of
the MoFS is as recent as they claim, or that their father's
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explanation for keeping it from them all these years is in the least
probable. That raises the question of delay, one that is, in my view,
considerable and militates against the grant of relief this far down
the road.
6. First, as to the terms of the MoFS. At a general level, and in
answer to the question of delay and limitation, Ms. Deshmukh
submits that under the MoFS, properties of the four minors were
sold. This gives each of them a separate and a joint cause of action,
and it is, therefore, open to them to move after the youngest of them
attains majority.
7. This however depends on a reading of certain clauses of the
MoFS. Ms. Deshmukh emphasizes clauses 5, 6, 7 and 11 of the
MoFS. These are set out below. In the MoFS, the acronym "MPS"
refers to Madhupati Singhania, the 1st Defendant; "AS" refers to
Anuradha Singhania, the 2nd Defendant; and "VPS" refers to Dr
Vijaypat Singhania, the 3rd Defendant.
5. Set out in the Second Schedule
hereunder written are the assets owned by
"MPS" in Part-A thereof and by "AS" in
Part-B thereof, Parts-C & D setting out
certain assets in addition to those set out
in Parts A and B that are respectively
owned by "MPS" and "AS" which they have
decided to retain with themselves in India.
So far as it relates to the assets etc.,
set out in Parts A and B, "MPS" and "AS"
have agreed to gift the same to "VPS"
possession or some other mode known to the
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law so as to effectuate such gifts. To that
end, "MPS" and "AS" declare and state that
they have taken all such steps for
effectuating such gifts.
6. Set out in Parts A, B, C and D
respectively of the Third Schedule are the
assets owned by MISS ANANYA SINGHANIA, MISS
RASAALIKA SINGHANIA, MISS TARINI SINGHANIA
AND MASTER RAIVAT HARI SINGHANIA. As father
and natural guardian of MISS ANANYA
SINGHANIA, MISS RASAALIKA SINGHANIA, MISS
RATINI SINGHANIA AND MASTER RAIVAT HARI
SINGHANIA, "MPS" has agreed that such
assets shall be sold or otherwise
transferred to "VPS" or persons nominated
by him at market value to the transferor
and that the price receivable in respect
thereof shall be credited in Bank Accounts
of MISS ANANYA SINGHANIA, MISS RASAALIKA
SINGHANIA, MISS RATINI SINGHANIA AND MASTER
RAIVAT HARI SINGHANIA respectively.
7. In so far as it relates to the Greater
Hindu Undivided Family of which "VPS" is
the Karta and inter alia "MPS" (along with
members of his Branch) are members, "MPS"
has agreed that he shall wholly release his
interest in the properties listed in Fourth
Schedule of the said Hindu Joint Family to
the end and intent that, upon such release,
he or the members of his Branch shall not
have any interest therein.
10. "MPS" has decided to retain certain
properties of his minor children as per
Part A, B, C, and D of Sixth Schedule.
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11. In so far as it relates to the 1/24th
share in certain immovable properties
referred to at Item No. 17 of Part C of the
Second Schedule (the particulars of which
are set out in the Seventh Schedule
hereunder written) that "MPS" has in
respect of certain immovable properties at
Kanpur and Mumbai acquired by "MPS" as a
result of the total partition of the Hindu
Joint Family of which "VPS" was the Karta,
"MPS" has decided that he shall continue to
hold his interest so acquired subject to
compliance with all statutory or judicial
orders or limitations.
8. These clauses are to be read with the Schedules to which each
of them refer. The Second Schedule, to which Clause 5 refers, is in
three parts: Part A is a list of assets gifted by the 1st Defendant to
the 3rd Defendant; Part B is a list of assets gifted by the 2nd
Defendant to the 3rd Defendant; and Parts C and D list those assets
that the 1st and 2nd Defendants, respectively, retained. All of these,
Ms. Deshmukh says, are ancestral properties that came to the hands
of the 1st and 2nd Defendants following a much earlier division or
separation in the Singhania family that divided the family businesses
between the Mumbai, Kanpur and Kolkata branches. Clause 6, Ms.
Deshmukh says, specifically refers to assets held in the names of the
Plaintiffs, all then minor. These are listed in Parts A to D of the
Third Schedule to the MoFS and all of these were either sold or
transferred to the 3rd Defendant at market value by the 1st
Defendant acting as the Plaintiffs' father and natural guardian. Each
of these parts shows an interest in some agricultural land at
Chhindwara; and the 1st Defendant's purported alienation of
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immovable property belonging to the minors was, Ms. Deshmukh
says, entirely void, not being of legal necessity or for the minors'
benefit. Clause 7 speaks of a division of the Greater HUF of which
the 3rd Defendant is (or then was) the karta and of which the 1st
Defendant and his family were members. By the MoFS the 1st
Defendant released his interest in these properties, listed in the
Fourth Schedule. Clause 10 relates to the Sixth Schedule, and the
four parts of this schedule set out movable assets retained by the 1st
Defendant for the four Plaintiffs, then all minors. Finally, under
Clause 11, the 1st Defendant retained to himself certain immovable
properties that came to him on a partition of the HUF of which the
3rd Defendant was the karta. Even this alienation in favour of the 1st
Defendant is, Ms. Deshmukh says, illegal.
9. I do not think it is possible to bundle all these clauses and
schedules into one category of a single impermissible alienation.
The MoFS is careful to segregate the various kinds of assets by
ownership and disposition, and each of these must, therefore, be
considered separately. Since Ms. Deshmukh places her case on a
reading on the provisions of the Hindu Minority & Guardianship
Act, 1956 ("HMGA"), it is necessary to summarize the claims.
These are summarized in the following tabulation:
Sr MoFS Disposition in MoFS Plaintiffs'
No Clause- Claim
Schedule-Part
1. Cl. 5, Sch. MPS's assets, Ancestral
II, Part A gifted to VPS property
2. Cl. 5, Sch. AS's property Ancestral
II, Part B gifted to VPS property
3. Cl. 5, Sch. MPS's property, Ancestral
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Sr MoFS Disposition in MoFS Plaintiffs'
No Clause- Claim
Schedule-Part
II, Part C retained property
4. Cl. 5, Sch. AS's property, Ancestral
II, Part D retained property
5. Cl. 6, Sch. Property of 2nd Separate
III, Part A Plaintiff, movable property
and immovable
6. Cl. 6, Sch. Property of 3rd Separate
III, Part B Plaintiff, movable property
and immovable
7. Cl. 6, Sch. Property of 4th Separate
III, Part
ig Plaintiff, movable
and immovable
property
8. Cl. 6, Sch. Property of 1st Separate
III, Part D Plaintiff, movable property
and immovable
9. Cl. 7, Sch. IV VPS Greater HUF Plaintiffs'
properties claim is to
a share in
the HUF
properties
10. Cl. 10, Sch. Plaintiffs' movable No claim
VI, Parts A to properties,
D retained by the
Plaintiffs
11. Cl. 11, Sch. Immovable No claim
I, Part C, properties at
item 17 Kanpur and Mumbai
on partition of HUF
(retained by MPS)
10. In paragraph 25 of the Affidavit in Rejoinder, the Plaintiffs
specifically say they make no claim for the properties retained.
Excluding those, therefore, i.e., properties retained by the Plaintiffs
or Defendants Nos. 1 and 2, the claims of the Plaintiffs are in
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respect of properties and assets that they claim were (a) ancestral;
(b) joint and undivided; (c) their (and each of their) own separate
movable properties; (d) their (and each of their) own separate
immovable properties; and (e) their shares in the properties of the
Greater HUF mentioned in Clause 7 and Schedule IV.
11. Although Ms. Deshmukh places her case on the provisions of
Section 8(1) of the HMGA, there are other provisions of that Act
that demand attention, as Mr. Tulzapurkar and Mr. Dwarkadas
point out. Specifically, we are also concerned with Sections 6(1),
8(2), 8(3), 8(4) and 12 of the HMGA. These read:
6. Natural guardians of a Hindu minor.--
The natural guardians of a Hindu minor, in
respect of the minor's person as well as in
respect of the minor's property (excluding
his or her undivided interest in joint-
family property), are--
(a) in the case of a boy of an
unmarried girl--The father and after
him the mother provided that the
custody of a minor who has not
completed the age of five years shall
ordinarily be with the mother;
(b) in the case of illegitimate boy
or an illegitimate unmarried girl the
mother, and after her the father;
(c) in the case of married girl the
husband;
8. Powers of natural guardian.-- (1) The
natural guardian of a Hindu minor has
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power, subject to the provisions of this
section, to do all acts which are necessary
or reasonable, and proper for the benefit
of the minor or for the realization,
protection or benefit of the minor's
estate; but the guardian can in no case
bind the minor by a personal covenant.
(2) The natural guardian shall not,
without previous permission of the Court,--
(a) mortgage or charge, or transfer
by sale, gift, exchange or otherwise,
any part of the immovable property of
the minor, or
(b) lease any part of such property
for a term exceeding five years or for
term extending more than one year
beyond the date on which the minor
will attain majority.
(3) Any disposal of immovable property by
a natural guardian, in contravention of
sub-section (1) or sub-section (2), is
voidable at the instance of the minor or
any person claiming under him.
(4) No Court shall grant permission to the
natural guardian to do any of the acts
mentioned in sub-section (2) except in case
of necessity or for an evident advantage to
the minor.
12. Guardian not to be appointed for
minor's undivided interest in Joint family
property.-- Where a minor has an undivided
interest in joint-family property and the
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property is under the management of an
adult member of the family no guardian
shall be appointed for minor in respect of
such undivided interest:
Provided that nothing in this section
shall be deemed to affect the jurisdiction
of a High Court to appoint a guardian in
respect of such interest.
(Emphasis supplied)
12. Ms. Deshmukh says that none of these dispositions or
alienations were for necessity or for the benefit of the minor; and as
regards the immovable property, admittedly no order of any Court
was obtained. All these transfers are, she submits, voidable at the
instance of the minors on the last of them attaining majority, and
hence this suit. As to the question of limitation, she submits that the
relevant provision is Article 109 of the Limitation Act, 1963, not
Article 60. However, I will assume for the purposes of this interim
order that the suit is within time. It has been brought within a few
months of the youngest of the Plaintiffs attaining majority and at
least to the extent that a part of the claim relates to a joint and
undivided interest in property, Ms. Deshmukh's submission may
have some foundation. Also, the contesting Defendants have not
raised limitation as a preliminary issue; indeed, everyone proceeded
on the basis that while delay and laches are factors to be considered
at this stage, limitation per se may be a matter that can await trial. Ms
Deshmukh tendered a compilation of authorities, but actually cited
only three. There is, however, in the compilation at least one
decision that on the point of limitation is against the proposition
Ms. Deshmukh commends. In Bhaskarrao Onkar Deshpande v
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Pushpa,3 a learned single Judge of this Court in terms held that being
tenants in common (as opposed to joint tenants), each had a right to
his or her defined share in the property. Each such tenant in
common would have an independent right and independent cause of
action, and limitation would therefore be governed by Article 60.
This means that a suit brought beyond three years following the
majority of the minor would be barred. On this reckoning, the suit at
the instance of two of the four Plaintiffs would be out of time, and
this is precisely the submission made by Mr. Tulzapurkar and Mr.
Dwarkadas.
13.
For his part, appearing for the 4th Defendant, Raymond Ltd,
Mr. Dwarkadas says that eo nomine a minor is a party to every
alienation made on his behalf. If he wishes to repudiate the
alienation, he is to do so within three years of attaining majority not
within three years of discovery of that alienation. 4 That might be an
overbroad formulation of the principle and, for that reason, I am
unwilling to accept it straight away. How could a minor assail an
alienation if it was only ever kept from him? I do not think it is either
sound or advisable to deny the Plaintiffs' reliefs on the ground of
limitation at this stage. I must proceed on the basis that their cause
is brought within time.
The 1st Defendant, Madhupati Singhania, the Plaintiffs'
14.
father, claims that he kept from his children the precise details of the
MoFS and document itself till the youngest of the Plaintiffs turned
18. While it seems to me unlikely that he would not at least casually
[1996] 98 BLR 816
Surta Singh v Pritam Singh, AIR 1983 P&H 114 (FB)
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have mentioned to the Plaintiffs that there was a separation of some
kind, it is not too fantastic to suppose that he did keep from them
the precise details of this till the youngest of the four was of a legal
age to act on it. It would be difficult, therefore, to unseat any of the
Plaintiffs at this interim stage without material evidence one way or
the other as to their actual date of knowledge, and it does seem to
me that the period of limitation cannot be expected to operate at a
time when the Plaintiffs did not even know that they had a cause of
action. I am not, therefore, prepared to hold against the Plaintiffs on
the ground of limitation at this stage and do not think it necessary to
deal further with this aspect of the matter.
15. On the question of what constitutes 'legal necessity' and
'benefit' to the minor, Ms. Deshmukh relies on the decision of a
Division Bench of the Andhra Pradesh High Court in B. Ranga Rao
& Ors. v G. Venkata Krishna Rao & Ors. 5 That decision reiterates the
well-settled principle of a permissible alienation by a karta for legal
necessity or the benefit of the estate, acting prudently. What
constitutes 'benefit to the estate' are not restricted to those that are
defensive in nature. The phrase speaks to a transaction that is
neither risky nor speculative, but one intended to confer an
advantage. I do not see how this assists Ms. Deshmukh. That very
principle, one with which there can be no quarrel, seems to me to
demand the acceptance of the MoFS rather than its rejection. The
MoFS speaks of growing hostility and antagonism in the family, of
sharp differences likely only to grow in the years ahead. The affairs
of the Madhupati Singhania branch were settled in a manner that
seemed then, and for the next several decades, to be acceptable to
AIR 1996 AP 5
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Madhupati and Anuradha Singhania. Certainly they brought no
challenge to it. They seem to have benefitted greatly from it,
including, as we shall presently see, from a later sale of some
properties that they retained in the separation.
16. The decision of the Supreme Court in Mt Phool Kuer v Mt
Pem Kuer,6 on which, too, Ms. Deshmukh places much reliance, also
does not seem to me to advance her cause; at least not sufficiently to
warrant the grant of the interim reliefs she seeks. That was a case in
a wholly different factual backdrop. A female Hindu entered into a
compromise on behalf of a minor widow with no application of mind
to the interests of the ultimate reversioners. The compromise was
entirely for her own benefit and for that of the minor widow "in
complete indifference as to what was to happen to the estate after
their respective deaths." Under the compromise in question, the
two ladies got everything to which they were entitled in Hindu law
but without sacrificing "an iota of their property". There is hardly a
parallel to be drawn with the case at hand.
17. Although it is in my view wholly a distraction and does
nothing to add to the Plaintiffs' cause, I must summarize Ms.
Sharma's arguments on behalf of the 1st and 2nd Defendants. The
MoFS is, she says, non-est. It is fraudulent and obtained by undue
influence and coercion. The 1st and 2nd Defendants and their
children were thrown out of the family, the companies and
businesses and the country itself. There can never be a 'family
settlement' merely on account of differences in management styles
or philosophies. Such Family Settlements are only ever on account
AIR 1952 SC 207
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of disputes relating to property. The MoFS is neither bona fide nor
equitable. It is unaccompanied by any relinquishment or gift deed or
any document that, had it been executed, would have required
registration; and the MoFS itself being unregistered, it cannot bind. 7
I note that Ms. Deshmukh was at some pains to put as much
distance as possible between herself and Ms. Sharma, and with good
reason. I do not think it is remotely possible to allow Madhupati and
Anuradha Singhania, however deep-rooted their sense of
disgruntlement, to fire from the shoulders of their children. The
Plaintiffs' cause is that their interests were once compromised by
their parents' actions. I see no reason to allow that to happen again.
18. I also find Ms. Sharma's reliance on Kale & Ors. v Deputy
Director of Consolidation & Ors.8 more than somewhat misplaced.
This is not an authority for the proposition that all family
arrangements must necessarily be restricted to property disputes
and can never extend to any other. Indeed, paragraph 9 of this
Supreme Court decision seems to me to indicate quite the reverse,
for it says, in essence, that the purpose of such arrangements is to
resolve internecine disputes once and for all. Their object is "to
protect the family from long drawn litigation or perpetual strifes
which mar the unity and solidarity of the family and create hatred
and bad blood between the various members of the family." These
arrangements or agreements serve a wider purpose. None of this
suggests that the only disputes that can be resolved by the
mechanism of a family arrangement are those that relate to property.
Certainly such property-related family arrangements are common,
Tek Bahadur Bhujil v Debi Singh Bhujil & Ors., AIR 1968 SC 292
AIR 1976 SC 807
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but that is by no means the same thing as saying that they are the
only types of family arrangements recognized by law.
19. Kale also does not say that each and every type of family
arrangement is compulsorily registrable. If the instrument itself
creates or declares any rights in immovable property, then that
might be so; but not if, as in this case, it only records a previous
understanding especially if that previous one was oral. Here, the
recitals of the MoFS are significant. These, and in particular Recital
10, show that the parties to the MoFS accepted that there was a
history of disagreement, one that was likely to escalate; that parties
desired to avoid "such adverse effects on such family peace,
harmony, prestige, etc.";9 that decisions had been previously taken
that Dr. Vijaypat Singhania would provide some level of support to
Madhupati and Anuradha Singhania;10 that Madhupati and
Anuradha Singhania had already decided to emigrate; 11 and,
importantly for our purposes, that discussions had concluded and a
Family Arrangement had been arrived at some time in the third
week of October 1998.12 I would venture to go further: none of the
clauses to which Ms. Deshmukh refers by themselves create any
dispositions or alienations. They all seem to me to record decisions
previously taken in that regard. They use phrases like "has decided
to keep", "shall wholly release", "desire to keep" and so on, not
"does hereby transfer and convey", words that one might ordinarily
and reasonably expect in any instrument that itself creates an
Recital 8, p. 43
Recital 9, p. 43
Recitals 8 and 9, p. 43
Recital 10, p. 43
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alienation or a divestation. Read thus, the MoFS is not an
instrument that requires registration, and the Supreme Court
decision in Kale seems to me to be against the proposition that Ms.
Sharma advances rather than in support of it. Mr. Tulzapurkar is
correct in pointing out these recitals and in his submission that since
all that the MoFS does is to record a previous oral family
arrangement, it does not require registration, nor can it be
invalidated today on that ground.
20. Mr. Tulzapurkar is also correct in pointing out the fatal
divergence in the case advanced by the Plaintiffs and that of their
parents at least in regard to the properties mentioned in Parts A and
B of the Second Schedule to the MoFS. The document clearly says
in clause 5 that these are the personal assets of Madhupati Singhania
and Anuradha Singhania respectively ("owned by 'MPS' and
'AS'") and which they have decided to retain with themselves in
India. But the Plaintiffs say these are joint family properties. If this is
so, Mr. Tulzapurkar says, and correctly, then it is for the Plaintiffs to
show how they are or can be held to be such. Of this, there is no
material at all; and there is in law no presumption that any property
is joint family property.
21. Even if they were, this does not help the Plaintiffs in the
present action. Admittedly, there has been no partition at least of
these assets. Section 8 of the HMGA has no application to the
undivided share of a minor in an HUF or in joint family property.
This is true too of the properties mentioned in the Fourth Schedule
to the MoFS, those of the "Vijaypat Singhania - Greater HUF".
This is a reference to the Plaintiffs' great-grandfather's (Kailashpat
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Singhania's) HUF, not the HUF of the Dr Vijaypat Singhania,
whose own HUF was partitioned in 1987 with Madhupati Singhania
taking his share in it. The Plaintiffs, then minors, would have taken
at best an undivided share descending per stirpes to their branch in
that Greater HUF, not an independent share. Madhupati Singhania
was the karta of his own HUF. In the larger or greater HUF, he took
a 1/8th share, and that of the Plaintiffs would be 1/48th. The assets
in the Fourth Schedule have only movables and, in any case, the
Plaintiffs' share, if any, in that is undivided and Section 8 of the
HMGA does not apply to the assets in this Schedule either.
22.
In addition, as Mr. Tulzapurkar points out, several properties
were retained by the Plaintiffs and their parents. Although the
MoFS says that these, in the Second and Third Schedules, were the
assets of the individuals in question, Madhupati Singhania now
alleges these to be joint. Strangely, the plaint seeks no relief in
respect of Anuradha Singhania's property. These are not isolated
contradictions either. The Plaintiffs contend, for instance, that their
father's (Madhupati Singhania's) property is joint and ancestral; the
MoFS says to the contrary; and there is nothing to show that the
statement in the MoFS is incorrect. Later, the Plaintiffs go on to say
that no relief is required to be sought in respect of the properties
retained by their parents, Madhupati and Anuradha Singhania,
Defendants Nos. 1 and 2;13 and while on the one hand claiming that
the MoFS makes an impermissible alienation of the Plaintiffs' rights
in joint and ancestral property, the Plaintiffs also say that each of
them has a separate and distinct right since their individual
properties have been sold/transferred by their parents to Dr
Para 25 at page 157, Affidavit in Rejoinder.
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Vijaypat Singhania. I do not see how it is possible to allow the
Plaintiffs to take such shifting or, at any rate, uncertain stands as to
their claim. There is no manner of doubt at all that several
properties and assets were retained by the Plaintiffs and their
parents. They cannot retain the benefits of these retentions while
assailing other dispositions. For instance, Madhupati and Anuradha
Singhania retained two valuable immovable properties, one at
Alibag and the other being a flat in the Sarnath Building at Breach
Candy, Warden Road. Both have been sold. The Sarnath flat was
sold for Rs.2 crores on 15th July 2005. A 50% interest in the Alibag
property was sold on 11th March 2002. Those proceeds have been
sequestered to themselves by Madhupati and Anuradha Singhania
and, through them, the Plaintiffs.
23. A learned single Judge of this Court (S. J. Vazifdar J., as he
then was) in P. N. Wankudre v C. S. Wankudre & Ors.,14 following the
Kale decision in terms held in the context of a family arrangement
that even assuming that the instrument is registrable, the obtaining
by a party of a benefit under that instrument would operate as a
species of estoppel. Having obtained an advantage under it, the
parties are prevented from resiling from it or trying to revoke it. The
answer to this from the Plaintiffs might, I suppose, be simplicity
itself: that which was retained was always personal and the Plaintiffs
and their parents were entitled to it, and to dispose of it, anyway;
the only challenge remaining being to interests in joint or ancestral
properties. Unfortunately, that is not how the plaint is cast at all.
There are transfers of individual assets too, and these are for
consideration received. I do not see how it possible to exclude those
AIR 2002 Bom 129
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alienations from the frame of the suit, i.e., to retain the benefits of
those transfers, and yet impeach the transfers themselves.
24. The Third Schedule to the MoFS lists, as I have noted, the
assets said to have been retained by (or, more accurately, on behalf
of ) the Plaintiffs. The Schedule has a separate part for each
Plaintiff. Each Part lists several movable assets, and also an item
described as "4.047 acres of agricultural land at Chindwara". This is
clearly a percentage and describes an undivided interest. If it was
jointly owned and has been transferred, this, too, is unexceptionable:
it might well stand to reason that retention of a fractional share in
land jointly owned in another state would be imprudent in any
envisaged separation. But the Plaintiffs cannot have it both ways:
they cannot simultaneously say it is a separate and distinct interest
and also say that all of it is joint and ancestral.
25. Perhaps the most striking aspect of the MoFS is that it brings
together in one document a number of disparate asset-ownership
threads, and that all this is directed to a single stated purpose: amity
and harmony in the family. I do not think it is at all possible to
oppugn the MoFS with the kind of exungulation Ms. Deshmukh
attempts. At the broadest level, given that this is an interim stage, I
am required only to see whether there is, on the face of it, a case that
the Plaintiffs can be said to have made with reference to the HMGA.
It is not, I think, correct to refer to any one provision of that Act in
isolation. As Mr. Tulzapurkar points out, the Supreme Court in Sri
Narayan Bal & Ors. v Sridhar Sutar15 specifically described the
various provisions of this Act as 'beads of the same string'. In
(1996) 8 SCC 54
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particular, it said, Section 8 cannot be viewed in isolation. The law
does not ordinarily contemplate a natural guardian of the undivided
interest of a Hindu minor in joint family property. Consequently,
prior permission of a court is not required for the disposition of such
an undivided interest of a minor in joint family property. This is also
the view of a learned single Judge of this Court (Anoop V. Mohta J.)
in Narayan Laxman Gilankar v Udaykumar Kashinath Kaushik.16
Thus, if the Plaintiffs are correct that the disposition in the MoFS
was of their undivided interest in joint family property, there can be
no question of Madhupati Singhania lacking the legal authority or
power to make that disposition or of it violating Section 8 of the
HMGA.
26. So much for the power of alienation. What of the question of
'legal necessity'? Mr. Tulzapurkar is again correct in pointing out
that the clearly expressed need for emigration itself constitutes a
sufficient statement of legal necessity.17 This, of course, must be
read in light of the fact that an actual emigration followed with
Madhupati and Anuradha Singhania relocating to Singapore with all
four Plaintiffs, then minors. Nagindas Maneklal & Ors v Mahomed
Yusuf Mitchella,18 a very old decision of 1919 of a Division Bench of
this Court, addressed the question of what might constitute
'necessity' in Hindu Law. Of course this decision predates the
HMGA by several decades, but perhaps that is for the better: the
Act does not, I think, redraw the law on the subject so much as it
AIR 1994 Bom 152
Vanimisatti Anil Kumar & Ors. v Jayavarapu Krishna Murty & Ors., AIR
1995 AP 105
XLVI (66) Ind. Law Reports 312
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only reaffirms or restates it. Nagindas Maneklal came up in second
appeal in a suit for specific performance. The minor sons of the
original first and second defendants opposed a suit for specific
performance of an agreement to sell entered into by those
defendants on the ground that the agreement, in relation to one
particular dilapidated property, was not 'for necessity'. Mr. Justice
Shah and Mr. Justice Fawcett delivered separate but concurring
judgments. The former held that the sale was justifiable. No general
rule could be laid down as to what would constitute necessity, or as
to when a Hindu father or coparcener may deal with an ancestral
estate for the obvious benefit of the family so as to bind minor
members. Shah J held:
"Even taking it that such power to alienate can be
exercised only when a clear case of necessity is made
out, I think the term "necessity" must not be strictly
construed. The benefit to the family may under certain
circumstances mean a necessity for the transaction. ... I
do not see any reason why a restricted interpretation
should be placed upon the word 'necessity' so as to
exclude a case like the present in which defendants Nos.
1 and 2 on all the facts proved properly and wisely
decided to get rid of the property which was in such a
state as to be a burden to the family."
Concurring, Fawcett J said:
"I quite agree. No doubt cases of legal necessity are
ordinarily those where debts have to be paid or there is
other financial pressure. But I do not think there is
authority for holding that legal necessity is confined
entirely to such cases."
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27. There was no authority for that proposition then. There is
none even today, four years short of a century later. To the contrary:
Wankudre takes a substantially similar view.
28. Any doubt about the soundness of the Nagindas Maneklal
view (one that is, in any case, binding on me) is, I believe, quite
firmly defenestrated by the decision in K. C. Kapoor v Smt. Radhika
Devi,19 in which the Supreme Court approved and applied the
interpretation enunciated in Nagindas Maneklal. The case before the
Supreme Court too related to the sale of a building in disrepair. The
Court held that the sale was an act of prudence by one who "wisely
sold a dilapidated building, and instead of pulling it down and
incurring expense over its reconstruction, had raised money for the
purpose of building the first floor of the new house at Lucknow
which was a big city as compared to the 'small and sleepy town' of
Rae Bareli."
29. The case at hand too is one that is best described (and,
indeed, describes itself ) as an act of prudence. The MoFS was
directed to that end: a prudent and quiet side-stepping of potential
future acrimony, possibly even litigation, and the clearly expressed
need of Defendants Nos. 1 and 2 to emigrate and settle elsewhere.
They did so.
30. Mr. Dwarkadas appears for the 4th Defendant, Raymond
Limited. Why this company has been joined to this action remains
unexplained. The MoFS refers to it not at all. The Plaintiffs are not
(1981) 4 SCC 487
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members of the 4th Defendant. Their names do not figure on its
register. No notice of any constructive or other trust is entered on
the 4th Defendant's register on behalf of the Plaintiffs. Mr.
Dwarkadas supplements Mr. Tulzapurkar's submission in saying
that where a single family arrangement such as the MoFS deals with
both movable and immovable properties, separate or joint, it cannot
be severed into component parts; when it falls for considerations, it
does so as a whole. The document has to be read as it stands, and
the standard to be applied in such a consideration is that of
quotidian prudence.20
31.
Leaving aside the question of limitation per se, the subsidiary
point that Mr. Dwarkadas makes is telling: if the minor has received
benefit and continued to receive and enjoy it after he attains
majority, can he then turn around at some distant point in time and
assail the alienation made in his majority, saying only that he did not
know of it earlier, but at the same time make no statement of
willingness to return all benefits received? I do not think this is at all
tenable as a course of conduct, and Mr. Dwarkadas is correct in his
submission in this regard. Election and conduct assume relevance,
among other things, because an alienation even contrary to Section
8 of the HMGA is not void ab initio; it is merely voidable.
In facts such as these, it is only a case sufficiently made out in
32.
fraud and coercion that might move a Court to set aside any such
alienation. Mr. Tulzapurkar is again correct in his submission, based
on the decision of the Privy Council in Partap Singh & Anr. v Sant
Palani Pillai v Sengamalathachi & Ors., AIR 1962 Mad 160
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Kaur & Anr.,21 that a minor cannot disturb a family settlement made
in good faith unless he or she makes out a case in fraud. I do not see
the remotest vestige of any such case; at least none that can be said
to have been made out by the Plaintiffs. The allegations of fraud and
coercion come, as perhaps they only can, from their parents,
Madhupati and Anuradha Singhania, Defendants Nos. 1 and 2. But
these allegations have about them the miasma of staleness and the
fetor of envy. Defendants Nos. 1 and 2 do not speak of what they
retained and received. They speak only of what they imagine they
lost. They speak of the company they left behind flourishing, and of
having to eke out what is subtly attempted to be portrayed as a
dismal, distant and desolate existence in a strange foreign land.
While the 3rd Defendant and his other son live in high luxury, the
1st and 2nd Defendants say, residing in palatial houses and
collecting expensive motor cars, their own children were forced into
public transport. In itself, that is probably no bad thing, even if the
allegations are not just odious but very likely incorrect. In his return,
the 3rd Defendant points out that the 1st and 2nd Defendants set
themselves up at the very forefront of Singapore's high society, with
a substantial residential estate in a prime area of that city-state, a
top-end yacht and a high-end motor car in their garage. This meets
with no effective denial even from the Plaintiffs. The 1st and 2nd
Defendants' statements, cold, bald and unmoored to any
surrounding circumstances are hardly the kind of compelling case
on fraud and coercion that requires to be made. Even if they could
make such a case, I do not see how that might help the Plaintiffs.
The two causes of action are entirely distinct and the 1st and 2nd
Defendants have not, at any time, sought to dislodge the MoFS on
AIR 1938 PC 181
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these grounds themselves. They cannot do so now, and they most
certainly cannot piggy-back their grievances on the Plaintiffs' cause.
33. There is no prima facie case made out by the Plaintiffs on their
challenge to the MoFS. As to balance of convenience and
irretrievable prejudice, given the obvious advantages derived by the
1st and 2nd Defendants and, through them, the Plaintiffs, coupled
with the absence of any commitment to restore the status quo ante,
and the 1st Defendant's quite egregiously exaggerated slant on the
background and effects of the MoFS, perhaps the less said the
better.
34. The Notice of Motion is dismissed, with no order as to costs.
Suit to be listed for directions in the normal course.
(G.S. PATEL, J.)
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