New Delhi: The Supreme Court has ruled that courts dealing with immovable property applications filed by a minor’s natural guardians must put the child’s interest first and ensure a proposed transaction offering a tangible benefit to the minor.
Section 8 of the Hindu Minority and Guardianship Act, 1956 (HMGA) prohibits a natural guardian from selling, transferring or otherwise dealing with a minor’s immovable property without prior court approval. Under Section 8(4), such approval can be granted only if the transaction is necessary or clearly beneficial to the minor.
A bench of Justices Sanjay Karol and N.K. Singh said that instead of rejecting such requests on technical considerations or speculative concerns, courts needed to “meticulously examine” if any proposed arrangement disposing of the minor’s share of their late father’s property could compromise the child’s present or future rights or interests.
Courts also have to understand that minors cannot fully comprehend or appreciate the consequences of such a transaction, it said.
“The best interest of the child is not passive consideration but a vigorous principle that requires foresight, caution, and meticulous scrutiny in every matter affecting the minor’s property—‘for an evident advantage to the minor’,” the bench said.
The court was acting on a mother’s plea to execute a development agreement involving her minor son’s share in an inherited property.
The dispute related to a property purchased in 1957 by the minor’s paternal great-grandfather. Following successive inheritances within the family, including the death of the minor’s father, Basudeb Chakraborty, in 2018, the child became entitled to an undivided share in the property.
In 2022, the co-owners proposed redeveloping the property through a development agreement with a builder. Under the arrangement, the minor was to receive a one-third share in a first-floor flat measuring about 399.33 sq ft along with Rs 10 lakh.
The mother approached the District Court in Darjeeling seeking permission under Section 8 of the HMGA to enter into the agreement on behalf of her son.
However, the court rejected the application, holding that she had failed to demonstrate either “necessity” or an “evident advantage” to the minor. The Calcutta High Court subsequently upheld the trial court’s decision.
Finally, the minor’s mother, Shephali Chakraborty, moved the Supreme Court, challenging these orders.
The ruling
The court made it clear that while Section 8 of the HMGA disallows a natural guardian from selling, transferring or otherwise dealing with a minor’s immovable property without prior court approval, Section 8(4) says that such approval can be granted only if the transaction is necessary or clearly beneficial to the minor.
Setting aside the decisions of the Darjeeling court and the Calcutta High Court, the bench held that a natural guardian, who holds a minor’s property in a fiduciary capacity, must satisfy the court that the proposed transaction is either necessary or demonstrably beneficial to the child.
“Section 8, therefore, embodies the principle that a natural guardian holds the minor’s property in a fiduciary capacity. The provision seeks to balance potentially competing interests, i.e., allowing practical management of the minor’s estate and subjecting what may be, irreversible decisions to judicial scrutiny, thereby ensuring that the welfare of the minor remains paramount,” the court ruled.
The court also accepted the mother’s argument that an undivided and undeveloped share in land may have limited practical value, compared to receiving a completed residential unit together with liquid funds which could offer immediate and concrete benefits to the minor.
Invoking the parens patriae principle underlying Section 8, the court said the doctrine emanates from the idea that the state bears a moral and legal responsibility toward those who are incapable of safeguarding their own interests.
“The Guardians and Wards Act, 1890 exemplifies the classical parens patriae structure,” the court said.
This is what led the court to allow the mother’s plea and grant her permission to execute the development agreement with the builder on behalf of her son.
(Edited by Sugita Katyal)
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