(3) Whether the gift made in favour of Ramya Agarwal is valid?

Yes, the gift made in favour of Ramya Agarwal is valid.

 Power of the Karta to Gift Property

It is a commonly known fact that a karta may have a superior managerial authority
but he cannot gift away family property unless there is a legal compulsion involved
or for religious purposes etc.

 Movable Property as gifts

The father or the Karta has the authority to gift ancestral joint family property to
sons, daughters etc. as a matter of affection wherein the gift is in furtherance of
“indispensible acts of duty, and family, relief from distress and so forth”. Such
gifts do have limitation like a gift cannot entail the whole property to be given to
one particular member as it cannot be then upheld as “gift of affection”.

 Immoveable Property as gifts

The karta does posses the capacity to gift an individual, owing to few restrictions,
for pious purposes. It was laid down in Guramma v. Mallapa[5] that a father can
gift his daughter a portion of an immoveable property if it conforms to the
reasonability criteria, looking at the properties which are owned by the family.
Though, it is not acceptable for a husband to gift any such property to his spouse
under the clause of “Pious Purposes”.

[5]1964 AIR 510, 1964 SCR (4) 497

KARTA’S POWER OF ALIENATION

Although no individual coparcener, including Karta has any power to dispose of

the joint family property without the consent of all other, it is a recognized concept
by the dharamshatra that in certain circumstance, any member of family has power
to alienate the joint family property.

Vijnaneshwara recognized three exceptional cases in which alienation of the joint

family property could be made by the Karta:

Legal Necessity (this includes Vijnaneshwara’s Apatkale as well as a part of

Kutumbarthe, i.e., for the sake of members family.)

Benefit of estate (this includes the other part of Kutumbarthe, i.e., for the sake of
family property.)

Acts of indispensable duty (this includes the entire head of Dharamarthe.)

However, the Karta may alienate the joint family property irrespective of legal
necessity or benefit of the estate with the consent of all adult coparceners in
existence at the time of such alienation. Here again, there is a difference in the law
prevailing in different states as to the position in case the alienation is consented to
only by some of the coparceners and not by all. As per the law in Bombay and
Madras, the shares of the consenting coparceners would be bound. However, in
West Bengal and Uttar Pradesh, a coparcener cannot alienate even his own interest
without the consent of all other coparceners and hence such alienation without the
consent of all coparceners would not even bind the shares of the consenting
members.
LEGAL NECESSITY

Broadly speaking, legal necessity will include all those things which are deemed
necessary for the members of the family. The term ‘Apatkale’ under
Vijnaneshwara may indicate that joint family property can be alienated only in
time of distress such as famine, epidemic, etc. and not otherwise, however, it has
been recognized under the modern law that necessity may extend beyond that. In
Devulapalli Kameswara Sastri vs. Polavarapu Veeracharlu[6], it was held that
necessity should not be understood in the sense of what is absolutely indispensable
but what according to the notions of the joint Hindu family would be regarded as
proper and reasonable. Thus, Legal Necessity doesn’t mean actual compulsion; it
means pressure upon estate which may in law may be regarded as serious and
sufficient. If it is shown that family’s need was for a particular thing and if
property was alienated for the satisfaction of that particular need, then it is enough
proof that there was a legal necessity. The following have been held to be family
necessities.

Maintenance of all the members of the Joint Hindu family, expenses for medical
care for the members.

Payment of government revenue and government taxes and duties like income tax.

Payment of debts incurred for family necessity or family business or decretal debts

Performance of necessary ceremonies, sradhs and upanyana.

Marriage expenses of male coparceners, and of the daughters of coparceners.

Payment of debts incurred for family business or other necessary purpose.

Costs incurred for the defense of the head of the joint family or any other member
involved in a serious criminal charge.

[6] (1911) ILR 34 Mad 422

Power of Alienation:

The most important case with respect to Karta’s power of alienation is Rani v.
Shanta[7]. Alienation can be done for three purposes:

 Legal Necessity: The term “legal necessity” has not been expressly defined
in any law or judgment. It is supposed to include all those things which are
deemed necessary for the members of the family. “Necessity” is to be
understood, not in the sense of what is absolutely indispensible, but what
would be regarded as proper and reasonable. If it is shown that family’s need
was for a particular thing, and if property was alienated for the satisfaction
of that particular need, then it is enough proof that there was a legal
necessity. They include,

(1) Food, shelter and clothing.

(2) Marriage (second marriages are not considered a legal necessity).
(3) Medical care.
(4) Defence of person accused of a crime (exception to this rule is
murder of a family member).
(5) Payments of debts, taxes etc.
(6) Performance of ceremonies (like marriage, grihapravesham).
(7) Rent etc.

 Indispensable Duties: This term implies the performance of those acts

which are religious, pious or charitable. Examples of indispensable duties
are marriages, grihapravesham etc. In this case there is a requirement to
differentiate between alienation made for indispensable duties and gifts for
charitable purposes. The difference lies in the fact that in the former case
while discharging indispensable duties, the Karta has unlimited powers in
the sense that he can alienate the entire property for that purpose. But in the
case of gifts for charitable purposes, only a small portion can be alienated.

[7] 1971 AIR 1028, 1971 SCR (2) 603

PARTIAL NECESSITY

In Krishandas vs. Nathuram[8], Privy council held that where the necessity is
only partial, i.e., where the money required to meet the necessity is less than the
amount raised by alienation, in such a case, the sale will be valid only where the
purchaser acts in good faith and after due inquiry and is able to show that the sale
itself is justified by legal necessity.

In the instant case, alienation was for Rs. 3500, and the alienee was able to prove
the legal necessity for Rs.3000, the alienation was held valid.

However, where the manager decides to raise money by a mortgage of family

property, he can borrow the precise amount required for necessity; mortgage will
stand good only to the extent of the necessity proved.

[8] 49 All 149 (PC),

(4) Whether the WILL made in favour of Ramesh Agarwal is vaild?
Yes Karta has the power to alienate the property
As Ramesh Agarwal ‘s Father expired, it was given for sole
survivorship for him.
Firstly, Kartha has the power to alienate property.

alienation is the capacity for a piece of property or aproperty right to be sold or

otherwise transferred from one party to another. Although property is generally
deemed to be alienable, it may be subject to restraints on alienation

Secondly, Ramesh Agarwal’s parents died, further justifying the alienation.

Thus, justifying the alienation in the form of Will.

1. Mulla, Principles of Hind law, vol.1 20th ed. (ed. S.A.Desai), LexisNexis Butterworths New Delhi, 2008

2. Mulla, Principles of Hind law, vol.2 20th ed. (ed. S.A.Desai), LexisNexis Butterworths New Delhi, 2008

3. Sanjiva Row, Sanjiva Row’s The Indian Succession Act, 7th ed. 2000, Butterworths India, New Delhi

4. Oxford Dictionary, 13th edn, Oxford printing house, 2008

5. Collin Dictionary, Collin Harpers Publication, 2009

6. K J Aiyar’s Judicial Dictionary , 13th edn (ed P M Bakshi), Butterworths India, New Delhi, 2001

[1] Manisha Singh, National Law University, Jodhpur

[2] AIR 1971 SC 1028

(5) Whether the sale of 30 acres of farm agricultural land for Rs.50
crores to renovate film studio is valid?
Yes, the sale of 30 acres of farm agricultural land for Rs. 50 crores to renovate
the film studio is valid.

 Benefit of Estate: Karta, as a prudent manager, can do all those things

which are in furtherance of the family’s advancement, to prevent probable
losses.
The purpose of selling the farm agricultural land to renovate the film studio is for
the benefit of the family. Mr Suresh Agarwal’s act of selling the land being a karta
is well justified, it falling under the functions and powers of karta.

BENEFIT OF ESTATE

An alienation of joint family property can be effected for the benefit to estate also.
There is also a lack of unanimity as to the interpretation of the words, as for the
benefit of the estate.

The courts have not given a set definition of this concept, undoubtedly so that it
can be suitably modified and expanded to include every act which might benefit
the family.

In the modern law the first exposition of the expression “for the benefit of the
estate” was found in the case of Palaniappa vs. Deivasikamony[9]. In this case the
judges observed “ No indication is to be found in any of them(ancient texts) as to
what is, in this connection, the precise nature of things to be included under the
descriptions ‘benefit to the estate’… The preservation however of the estate from
extinction, the defense against hostile litigation affecting it, the protection of it or
portions from injury or deterioration by inundations, there and such like things
would obviously be benefits”

[9] A.I.R. 1917 P.C. 33. (22nd March 1917.)

The Privy Council has elaborately illustrated as to what are the incidents of benefit
to estate in Palaniappa v. Devsikmony[10], it laid down that “the preservation,”
however, of the estate from extinction, the defense against the hostile litigation
affecting it, the protection of it or its portion from injury or deterioration by
inundation, these and such like things would obviously be the benefits. In broad
sense legal necessity includes ‘benefit to estate’.

(6) Whether mortgage of shares of S.R.NBFC to State Bank of

Hyderabad, Baghlingampally Branch, Hyderabad to perform the
marriage of Ramya Agarwal is valid ?
The powers of the Karta are almost absolute. There are 9 powers in all and are as
follows:

 Powers of Management: It is an absolute power. The Karta cannot deny

maintenance and occupation of property to any member altogether. It is the
karta’s duty to manage the family affairs.

 Right to Income: All incomes of the joint family property should be

brought to the Karta and it is for the Karta to allot funds to members and to
look after their needs and requirements.

 Right to Representation: The Karta represents the family in all matters

legal, social and religious. His acts are binding on the family.

 Power of compromise: The Karta has the power to compromise in all

disputes relating to the family property or management. His acts are binding
on the members of the family; but in case of a minor, it has to be approved
by the court under O.32, Rule 7, CPC. The compromise made by the Karta
can be challenged in court by any of the coparceners only on the ground of
malafide.

[10] 1917 P.C. 68

  Power to refer a dispute to Arbitration: The Karta has the power to refer
any dispute with respect to family property or management to an arbitration
council and the decision is binding on the family.

 Power of Acknowledgement: The Karta can acknowledge any debt due to

the family or pay interest on a debt or make part or full payment of principal
etc. But the Karta has no power to acknowledge a time-barred debt.

 Power to Contract Debts: The Karta has implied authority to contract debts
and pledge the credit and property of the family. His decision is binding on
the members of the joint family.

 Loan on Promissory Note: When the Karta takes a loan for family
purposes and executes a promissory note, then the other members may be
sued as well even if they are not parties to the note. But the members are
liable to the extent of their shares whereas the Karta is personally liable on
the note.

 Power to enter into Contracts: The Karta has the power to enter into
contracts which are binding on the family.

(7) Whether the income of Sailesh Agarwal be included in Hindu

Undivided Family?
No, the income of Sailesh Agarwal need not be included in the Hinu
Undivided Family.

Coparcenary property is the property inherited from paternal ancestor;

Property inherited by a person from his father,or father’s father or father’s father’s
father’s or property his own son,son’s son’s or son’s son’s son’sacquires an
interest by birth as coparcenary rights. It is, therefore, coparcenaryproperty.An
accretion to this property, such as purchasesmade with income of the coparcenary
property is also coparcenary property.

Coparcenary property includes

(a) ancestral property.

(b)acquisition made by coparceners with the help of ancestral property.

(c)joint acquisition of the coparceners and there is no proof of intention on the part
of the coparceners that such property should not be treated as joint property and

(d) separate property of the coparceners thrown into the common stock.

Though Sailesh Agarwal studied at the expenses of the joint hindu family property,
being educated is a basic right of an individual. And this can be attained even
through the hindu undivided family’s expenses. Thus, sailesh agarwal need to
include his personal savings and income into the hindu undivided family (on the
grounds that he attained his education in this means.)
 PRAYER FOR RELIEF

Wherefore, in the light of the authorities cited, issue raised and arguments
advanced, it is most humbly pleaded before the Hon’ble court that it may adjudge
and declare:

(a)The Gift and Will made by Sunil Agarwal made in favour of Ramya,Ramesh
Agarawal respectively

(b) Sale of 30 acres of farm agricultural land for Rs.50 crores to renovate film
studio

(3) Whether the gift made in favour of Ramya Agarwal is valid?

Yes, the gift made in favour of Ramya Agarwal is valid.

 Power of the Karta to Gift Property

It is a commonly known fact that a karta may have a superior managerial authority
but he cannot gift away family property unless there is a legal compulsion involved
or for religious purposes etc.

 Movable Property as gifts

The father or the Karta has the authority to gift ancestral joint family property to
sons, daughters etc. as a matter of affection wherein the gift is in furtherance of
“indispensible acts of duty, and family, relief from distress and so forth”. Such
gifts do have limitation like a gift cannot entail the whole property to be given to
one particular member as it cannot be then upheld as “gift of affection”.

 Immoveable Property as gifts

The karta does posses the capacity to gift an individual, owing to few restrictions,
for pious purposes. It was laid down in Guramma v. Mallapa[5] that a father can
gift his daughter a portion of an immoveable property if it conforms to the
reasonability criteria, looking at the properties which are owned by the family.
Though, it is not acceptable for a husband to gift any such property to his spouse
under the clause of “Pious Purposes”.

[5]1964 AIR 510, 1964 SCR (4) 497

KARTA’S POWER OF ALIENATION

Although no individual coparcener, including Karta has any power to dispose of

the joint family property without the consent of all other, it is a recognized concept
by the dharamshatra that in certain circumstance, any member of family has power
to alienate the joint family property.

Vijnaneshwara recognized three exceptional cases in which alienation of the joint

family property could be made by the Karta:

Legal Necessity (this includes Vijnaneshwara’s Apatkale as well as a part of

Kutumbarthe, i.e., for the sake of members family.)

Benefit of estate (this includes the other part of Kutumbarthe, i.e., for the sake of
family property.)

Acts of indispensable duty (this includes the entire head of Dharamarthe.)

However, the Karta may alienate the joint family property irrespective of legal
necessity or benefit of the estate with the consent of all adult coparceners in
existence at the time of such alienation. Here again, there is a difference in the law
prevailing in different states as to the position in case the alienation is consented to
only by some of the coparceners and not by all. As per the law in Bombay and
Madras, the shares of the consenting coparceners would be bound. However, in
West Bengal and Uttar Pradesh, a coparcener cannot alienate even his own interest
without the consent of all other coparceners and hence such alienation without the
consent of all coparceners would not even bind the shares of the consenting
members.

LEGAL NECESSITY

Broadly speaking, legal necessity will include all those things which are deemed
necessary for the members of the family. The term ‘Apatkale’ under
Vijnaneshwara may indicate that joint family property can be alienated only in
time of distress such as famine, epidemic, etc. and not otherwise, however, it has
been recognized under the modern law that necessity may extend beyond that. In
Devulapalli Kameswara Sastri vs. Polavarapu Veeracharlu[6], it was held that
necessity should not be understood in the sense of what is absolutely indispensable
but what according to the notions of the joint Hindu family would be regarded as
proper and reasonable. Thus, Legal Necessity doesn’t mean actual compulsion; it
means pressure upon estate which may in law may be regarded as serious and
sufficient. If it is shown that family’s need was for a particular thing and if
property was alienated for the satisfaction of that particular need, then it is enough
proof that there was a legal necessity. The following have been held to be family
necessities.

Maintenance of all the members of the Joint Hindu family, expenses for medical
care for the members.
Payment of government revenue and government taxes and duties like income tax.

Payment of debts incurred for family necessity or family business or decretal debts

Performance of necessary ceremonies, sradhs and upanyana.

Marriage expenses of male coparceners, and of the daughters of coparceners.

Payment of debts incurred for family business or other necessary purpose.

Costs incurred for the defense of the head of the joint family or any other member
involved in a serious criminal charge.

[6] (1911) ILR 34 Mad 422

Power of Alienation:

The most important case with respect to Karta’s power of alienation is Rani v.
Shanta[7]. Alienation can be done for three purposes:

 Legal Necessity: The term “legal necessity” has not been expressly defined
in any law or judgment. It is supposed to include all those things which are
deemed necessary for the members of the family. “Necessity” is to be
understood, not in the sense of what is absolutely indispensible, but what
would be regarded as proper and reasonable. If it is shown that family’s need
was for a particular thing, and if property was alienated for the satisfaction
of that particular need, then it is enough proof that there was a legal
necessity. They include,

(8) Food, shelter and clothing.

(9) Marriage (second marriages are not considered a legal necessity).
(10) Medical care.
(11) Defence of person accused of a crime (exception to this rule is
murder of a family member).
(12) Payments of debts, taxes etc.
 (13) Performance of ceremonies (like marriage, grihapravesham).
(14) Rent etc.

 Indispensable Duties: This term implies the performance of those acts

which are religious, pious or charitable. Examples of indispensable duties
are marriages, grihapravesham etc. In this case there is a requirement to
differentiate between alienation made for indispensable duties and gifts for
charitable purposes. The difference lies in the fact that in the former case
while discharging indispensable duties, the Karta has unlimited powers in
the sense that he can alienate the entire property for that purpose. But in the
case of gifts for charitable purposes, only a small portion can be alienated.

[7] 1971 AIR 1028, 1971 SCR (2) 603

PARTIAL NECESSITY

In Krishandas vs. Nathuram[8], Privy council held that where the necessity is
only partial, i.e., where the money required to meet the necessity is less than the
amount raised by alienation, in such a case, the sale will be valid only where the
purchaser acts in good faith and after due inquiry and is able to show that the sale
itself is justified by legal necessity.

In the instant case, alienation was for Rs. 3500, and the alienee was able to prove
the legal necessity for Rs.3000, the alienation was held valid.

However, where the manager decides to raise money by a mortgage of family

property, he can borrow the precise amount required for necessity; mortgage will
stand good only to the extent of the necessity proved.
 [8] 49 All 149 (PC),

(4) Whether the WILL made in favour of Ramesh Agarwal is vaild?

Yes Karta has the power to alienate the property
As Ramesh Agarwal ‘s Father expired, it was given for sole
survivorship for him.
Firstly, Kartha has the power to alienate property.

alienation is the capacity for a piece of property or aproperty right to be sold or

otherwise transferred from one party to another. Although property is generally
deemed to be alienable, it may be subject to restraints on alienation

Secondly, Ramesh Agarwal’s parents died, further justifying the alienation.

Thus, justifying the alienation in the form of Will.

1. Mulla, Principles of Hind law, vol.1 20th ed. (ed. S.A.Desai), LexisNexis Butterworths New Delhi, 2008

2. Mulla, Principles of Hind law, vol.2 20th ed. (ed. S.A.Desai), LexisNexis Butterworths New Delhi, 2008

3. Sanjiva Row, Sanjiva Row’s The Indian Succession Act, 7th ed. 2000, Butterworths India, New Delhi

4. Oxford Dictionary, 13th edn, Oxford printing house, 2008

5. Collin Dictionary, Collin Harpers Publication, 2009

6. K J Aiyar’s Judicial Dictionary , 13th edn (ed P M Bakshi), Butterworths India, New Delhi, 2001

[1] Manisha Singh, National Law University, Jodhpur

[2] AIR 1971 SC 1028

(5) Whether the sale of 30 acres of farm agricultural land for Rs.50
crores to renovate film studio is valid?
Yes, the sale of 30 acres of farm agricultural land for Rs. 50 crores to renovate
the film studio is valid.

 Benefit of Estate: Karta, as a prudent manager, can do all those things

which are in furtherance of the family’s advancement, to prevent probable
losses.
The purpose of selling the farm agricultural land to renovate the film studio is for
the benefit of the family. Mr Suresh Agarwal’s act of selling the land being a karta
is well justified, it falling under the functions and powers of karta.

BENEFIT OF ESTATE

An alienation of joint family property can be effected for the benefit to estate also.
There is also a lack of unanimity as to the interpretation of the words, as for the
benefit of the estate.
The courts have not given a set definition of this concept, undoubtedly so that it
can be suitably modified and expanded to include every act which might benefit
the family.

In the modern law the first exposition of the expression “for the benefit of the
estate” was found in the case of Palaniappa vs. Deivasikamony[9]. In this case the
judges observed “ No indication is to be found in any of them(ancient texts) as to
what is, in this connection, the precise nature of things to be included under the
descriptions ‘benefit to the estate’… The preservation however of the estate from
extinction, the defense against hostile litigation affecting it, the protection of it or
portions from injury or deterioration by inundations, there and such like things
would obviously be benefits”

[9] A.I.R. 1917 P.C. 33. (22nd March 1917.)

The Privy Council has elaborately illustrated as to what are the incidents of benefit
to estate in Palaniappa v. Devsikmony[10], it laid down that “the preservation,”
however, of the estate from extinction, the defense against the hostile litigation
affecting it, the protection of it or its portion from injury or deterioration by
inundation, these and such like things would obviously be the benefits. In broad
sense legal necessity includes ‘benefit to estate’.

(6) Whether mortgage of shares of S.R.NBFC to State Bank of

Hyderabad, Baghlingampally Branch, Hyderabad to perform the
marriage of Ramya Agarwal is valid ?
The powers of the Karta are almost absolute. There are 9 powers in all and are as
follows:

 Powers of Management: It is an absolute power. The Karta cannot deny

maintenance and occupation of property to any member altogether. It is the
karta’s duty to manage the family affairs.
  Right to Income: All incomes of the joint family property should be
brought to the Karta and it is for the Karta to allot funds to members and to
look after their needs and requirements.

 Right to Representation: The Karta represents the family in all matters

legal, social and religious. His acts are binding on the family.

 Power of compromise: The Karta has the power to compromise in all

disputes relating to the family property or management. His acts are binding
on the members of the family; but in case of a minor, it has to be approved
by the court under O.32, Rule 7, CPC. The compromise made by the Karta
can be challenged in court by any of the coparceners only on the ground of
malafide.

[10] 1917 P.C. 68

 Power to refer a dispute to Arbitration: The Karta has the power to refer
any dispute with respect to family property or management to an arbitration
council and the decision is binding on the family.

 Power of Acknowledgement: The Karta can acknowledge any debt due to

the family or pay interest on a debt or make part or full payment of principal
etc. But the Karta has no power to acknowledge a time-barred debt.

 Power to Contract Debts: The Karta has implied authority to contract debts
and pledge the credit and property of the family. His decision is binding on
the members of the joint family.

 Loan on Promissory Note: When the Karta takes a loan for family
purposes and executes a promissory note, then the other members may be
sued as well even if they are not parties to the note. But the members are
liable to the extent of their shares whereas the Karta is personally liable on
the note.
  Power to enter into Contracts: The Karta has the power to enter into
contracts which are binding on the family.

(7) Whether the income of Sailesh Agarwal be included in Hindu

Undivided Family?
No, the income of Sailesh Agarwal need not be included in the Hinu
Undivided Family.

Coparcenary property is the property inherited from paternal ancestor;

Property inherited by a person from his father,or father’s father or father’s father’s
father’s or property his own son,son’s son’s or son’s son’s son’sacquires an
interest by birth as coparcenary rights. It is, therefore, coparcenaryproperty.An
accretion to this property, such as purchasesmade with income of the coparcenary
property is also coparcenary property.

Coparcenary property includes

(a) ancestral property.

(b)acquisition made by coparceners with the help of ancestral property.

(c)joint acquisition of the coparceners and there is no proof of intention on the part
of the coparceners that such property should not be treated as joint property and

(d) separate property of the coparceners thrown into the common stock.

Though Sailesh Agarwal studied at the expenses of the joint hindu family property,
being educated is a basic right of an individual. And this can be attained even
through the hindu undivided family’s expenses. Thus, sailesh agarwal need to
include his personal savings and income into the hindu undivided family (on the
grounds that he attained his education in this means.)
PRAYER FOR RELIEF

Wherefore, in the light of the authorities cited, issue raised and arguments
advanced, it is most humbly pleaded before the Hon’ble court that it may adjudge
and declare:

 To declare valid

(a)The Gift and Will made by Sunil Agarwal made in favour of Ramya,Ramesh
Agarawal respectively

(b) Sale of 30 acres of farm agricultural land for Rs.50 crores to renovate film
studio

(c)Mortgage of shares of S.R.NBFC to State Bank of Hyderabad, Baghlingampally

Branch, Hyderabad to perform the marriage of Ramya Agarwal

(d) Need not include the income of income of Sailesh Agarwal in Hindu Undivided
Family

To issue any other further order as the court may deem fit in interest of justice,
equity good conscience and fair play.

PLACE: HYDERABAD SD/-

DATE: COUNSELS FOR THE
19 march 2016 APPELLANT