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Property registered in name of minor son

Page no : 2

P. Venu (Advocate)     13 June 2021

The property purchased in the name of son constitutes Gift in Advance. In England, such cases are covered by the Doctrine of Advancement.

The rule is that where real and personal property is vested in a purchaser jointly with others or in another or other persons alone, a resulting trust will be presumed in favor of a person who is proved to have paid the purchase money. The beneficial interest in the property results to the actual purchaser.

However, the presumption which arises on a purchase in the name of another, is rebuttal on the ground that the purchaser intended to benefit the other. In certain circumstances, there is a presumption the other way, namely that there is no resulting trust. This applies where the person in whom the property is vested is the lawful wife or child of the purchaser or was a person to whom he stood in loco parentis.

In English law, there is a presumption that when a property is purchased in the name of a person, and the consideration for such property has been paid by the legal ascendant of such person, it is presumed that the legal ascendant has gifted the said property to his/her heir as an advance on what he /she will inherit upon death of the ascendant. This is known as the DOCTRINE OF ADVANCEMENT.

Though the Indian law does not accept such Doctrine Of Advancement in its entirety, the legislature has carved out certain exceptions to the benami transaction under Section 2(9)A of the Prohibition of Benami Property Transactions Act, 1988::

2. Definitions

--------------------------------

-----------------------------------

9) "benami transaction" means,--


(A) a transaction or an arrangement--


(a) where a property is transferred to, or is held by, a person, and the consideration for such property has been provided, or paid by, another person; and


(b) the property is held for the immediate or future benefit, direct or indirect, of the person who has provided the consideration,


except when the property is held by--


(i) a Karta, or a member of a Hindu undivided family, as the case may be, and the property is held for his benefit or benefit of other members in the family and the consideration for such property has been provided or paid out of the known sources of the Hindu undivided family;


(ii) a person standing in a fiduciary capacity for the benefit of another person towards whom he stands in such capacity and includes a trustee, executor, partner, director of a company, a depository or a participant as an agent of a depository under the Depositories Act, 1996 (22 of 1996) and any other person as may be notified by the Central Government for this purpose;


(iii) any person being an individual in the name of his spouse or in the name of any child of such individual and the consideration for such property has been provided or paid out of the known sources of the individual;


(iv) any person in the name of his brother or sister or lineal ascendant or descendant, where the names of brother or sister or lineal ascendant or descendant and the individual appear as joint owners in any document, and the consideration for such property has been provided or paid out of the known sources of the individual; "

In the given circumstances, in my understanding, there is no justification or  cause of action  in instituting any proceedings against the estranged son based on adverse possession or the provisions of Maintenance and Welfare of Parents and Senior Citizens Act.

1 Like

Sudhir Kumar (Dy Director)     17 June 2021

It is not a benami property.

 

Law allows the stupidity of purchasing property in the name of minor child.


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