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Tushar Jha (Advisor)     02 September 2021

Intestate succession of property in a co-operative society

Can a deceased co-owner's property in a CHS (Registered under Maharashtra Co-Operative Societies Act, 1960) be handled by preparing 'family arrangement deed' amongst the remaining legal heirs?

Suppose A(Husband) & B(Wife) are joint-owners of an immovable property in a CHS. They have one son (C) and one daughter (D). Wife(B) died a natural death in 2020. A & B are Hindus.

1. Can A, C & D make a 'family Arrangement Deed' amongst themselves for succeeding the shares in CHS flat of deceased co-owner 'B'?

2. Can family arrangement deed be notarized on a Rs. 500 stamp paper?

3. Or 'family Arrangement Deed' needs to be registered under the provisions of Registration Act, 1908 with Sub-registrar of Assurances ? If yes, how much stamp duty is payable ?



Learning

 1 Replies

Kevin Moses Paul   07 September 2021

As per your concern I've laid down a link of a forum with similar issue. Have a look at it in order to attain more input regarding the transfer of property of a deceased Hindu female:-

https://www.lawyersclubindia.com/forum/details.asp?mod_id=219502

Basically, a Family Arrangement is an agreement between members of the same family, intended to be generally and reasonably for the benefit of the family, either by compromising doubtful or disputed rights or by preserving the family property or the peace and security of the family by avoiding litigation or by saving its honour. And thus, such an agreement may be implied from a long course of dealing, and is often more useful to embody or to effectuate the agreement in a deed to which the term family agreement is applied.

In the matter of Kale & Ors vs. Deputy Director of Consolidation the Supreme Court of India held that -
(I) The family arrangement should be bonafide in order to resolve present or possible future disputes among family members and to ensure equitable distribution of property among the family members;
(II) The family arrangement needs to be honest, voluntary and should not be induced by fraud, coercion and undue influence;
Family arrangement can either be oral or written;
(III) The memorandum recording the family arrangement itself does not create or extinguish any rights in the immovable properties, therefore, not compulsorily registrable.
(IV) The members of a family who are parties to a family arrangement must have an antecedent title, claim or interest in the property. If the rights of a property are relinquished in favour of a member in a family arrangement who has no antecedent title in the property than it shall be presumed that such person has an antecedent in the property.
(V) The family arrangement which is fair and equitable is final and binding on the parties to the settlement.

On 31st July, 2020 in the matter of ‘Ravinder Kaur Grewal & Ors vs. Manjit Kaur & Ors’ the Supreme Court addressed the question regarding the registration of MOFS and held that MOFS prepared after family arrangement was already made for the purpose of recording the information or for the information of the court, is not required to be registered.

Henceforth, registering isn't mandatory.

NOTE:- MOFS in simple words is a document/ arrangement between the family members that records the orally agreed terms of division of property(ies) inter-se between them.


For any further information you can contact on the email ID given below:- advkmpaul3897@gmail.com

Hope It Helps!

Regards,
Kevin M. Paul

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