INTRODUCTION- MEANING OF ‘LEGAL NECESSITY’
The Karta is entrusted with the management of the property, and can alienate the property if following persists: (1) Legal Necessity; (2) Benefit of Estate; (3) Performance of religious and indispensable duties.
‘Legal necessity’, literally means, any necessity that can be sustained in law, or justified in law. With respect to joint family, it means a necessity of the family, with respect to its members and in certain cases, also with respect to its property that can be justified in law. Both purpose and necessity are distinguishable and a transfer in order to be justified must be backed by a law of alternate resources, in addition to the presence of a purpose. e.g., Payment of Government dues is an illustration of what can be called a purpose with respect to the property of the family that requires money. But, there is no necessity, as sufficient resources are available from which dues can be paid.
For an alienation to be valid under legal necessity, four things must be present:
- existence of a need or purpose
- such requirement is for a lawful purpose
- the family does not possess monetary or alternative resources
- the course of action taken by the Karta is such as an ordinary, prudent person will take with respect to his property
CASE- DEV KISHAN V RAM KISHAN, AIR 2002 Raj 370
Facts: The Karta effected a mortgage, a sub-mortgage and a sale of two houses belonging to the joint family, worth around RS 8000 to RS 9000, for a consideration of RS 400 to RS 900, which according to him, were to be utilized for the marriage of his three minor children. The sale deed was executed on the day the son was getting married. The other members of Joint Family approached the court to get the deeds declared void, claiming that there was no legal necessity for mortgaging as well as for selling the properties and hence the sale of properties was illegal, for that the plaintiffs were not bound to it.
Findings of Lower Courts: Lower Courts declared the mortgage deed as well as sale deeds as void for the following reasons:
- Mortgage Deed and Sale Deed were executed for the purpose of marriage of minor daughters and son.
- The loan taken cannot be termed as loan for payment of antecedent debt as the loan was taken for the purpose of minor’s marriages and not for the payment of earlier debts
- The marriage of minors cannot be termed as a Legal Necessity.
- Transaction done for the purpose of minor’s marriage become void being opposed to public policy in view of child prohibition child marriage under the Child marriage Restraint act, 1929, therefore cannot be termed as a legal necessity.
- Sale Deed was executed on the day of marriage of the son, so amount was not even utilized for the purpose of marriage.
Legal Issue: The supreme court on appeal, framed following substantial questions of law:
- Whether the taking of the debt by a major member of the family for the marriage of a minor member of the family is a debt incurred for a legal necessity or is for illegal purpose?
- Whether the debts incurred by the father for satisfying the earlier mortgages should be considered to have been incurred for legal necessity?
- Whether the sale for satisfying the earlier mortgage debt of the Joint Hindu family and for performing the marriage of a minor member of the family was rightly held to be void by the appellate court?
Substantial Question 1:
The debt incurred for the purpose of the marriage of the minor, performed in violation of the provisions of the act of 1929, cannot be regarded as a lawful debt and alienation on that ground cannot be regarded as lawful alienation binding upon the minors. Thus the debt in question taken for the purpose of marrying his minor children cannot be regarded as lawful debt and cannot constitute legal necessity.
Substantial Question 2:
The father of joint hindu family may sell or mortgage the joint hindu family property including the son’s interest therein to discharge a debt contracted by him for his own personal benefit, and such alienation binds the sons provided-(a) the debt was antecedent to the alienation; (b) it was not incurred for an immoral purpose.
The debt in question was not for the payment of antecedent debt as the purpose for the debt was the marriage of minor daughters and son. Since it was not a lawful debt thus cannot constitute legal necessity.
Substantial Question 3:
Since the debt taken was not a lawful debt and it was not taken for the welfare of the Joint Hindu Family and furthermore, the debt was not taken for the payment of antecedent debt, therefore the sale deed was declared void.