‘Coparcenary’ and ‘Hindu undivided family’ are not words we hear often, but they are the foundation of a discriminatory concept in Indian family law responsible for an annual revenue loss of thousands of crores to the Indian exchequer. In 1948, BR Ambedkar proposed its abolition on the basis that it was not in sync with the times. Legal experts have claimed that now, the Uttarakhand Uniform Civil Code finally abolishes these concepts. Closer examination reveals that it does not.
What is the existing law on coparcenary property across India?
Hindu joint families in northern and western India are governed by the ‘mitakshara’ school of law, which enables them to hold their ancestral property collectively. This property is managed by a sub-unit of the joint family called a ‘coparcenary’. Upon birth, each coparcener acquires a share in the common property (right by birth). When a coparcener dies, the property is partitioned and the deceased person’s share is separated. This share then passes as per the prescribed scheme of succession. It is based on the anachronistic concept of the jointness of food and worship in Hindu joint families and the moral obligation of certain members (traditionally males) to maintain and look after the whole family.
Under the Hindu Succession Act (HSA) 1956, only males could be coparceners. The underlying principle was that only a son has a birthright in ancestral property — a prominent maxim of classical Hindu law. In 2005, Parliament amended the HSA to correct the gender imbalance within Hindu law by making daughters coparceners at par with sons. However, it did not abolish the coparcenary system and the right that sons (and now also daughters) acquire in their ancestral property upon their birth.
Over the years, there have been calls for the abolition of the coparcenary system as it is not in alignment with modern family structures, something that was pointed out during the debates on the Hindu Code Bill itself.
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What does the UUCC do?
The UUCC maintains the status quo and does not abolish coparcenary property despite earlier indications. It merely defines a person’s ‘estate’ to include their share in the ancestral property; in other words, their coparcenary share. Once the property gets partitioned upon a coparcener’s death (as per the HSA), it will devolve to heirs based on the intestate succession scheme laid down in the UUCC. This is the case since the UUCC only provides that those parts of the HSA that are inconsistent with it will no longer apply in Uttarakhand. Thus, coparcenaries will continue to come into existence and operate as per the HSA.
The Hindu undivided family conundrum
The UUCC maintains silence on HUFs, which have some real fiscal implications. Joint Hindu families are permitted to set up HUFs, which are recognised as distinct entities for the purpose of computation of income tax. By channelling their own individual incomes to HUFs set up along with other family members, individuals habitually reduce their own taxable income. The notional revenue loss to the exchequer is immense, and over time, it has become well established that HUFs are little more than a tax avoidance device.
In addition, this device is available only to Hindus, Buddhists, Sikhs, and Jains (to whom Hindu family law applies) but not to persons of any other religious community. In this, it is blatantly discriminatory. In 2018, the Law Commission frankly remarked: “…it is high time that it is understood that justifying this institution [coparcenaries/HUFs] on the ground of deep-rooted sentiments at the cost of the country’s revenues may not be judicious.”
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What UUCC should have done
The Supreme Court has found that abolishing the coparcenary system would lead to the automatic abolition of the HUF system under income tax law. Curiously, in 1975, Kerala had legislated to abolish the concept of coparcenary and joint family property by explicitly abolishing the right by birth. The top court found that this being the case, the IT department could not make computations on the assessee’s HUF in Kerala.
If the UUCC truly wanted to abolish coparcenaries and HUFs, the only option was to do exactly what Kerala had done in 1975 — abolish the right by birth. That hasn’t been done, and therefore, coparcenaries and HUFs will continue to remain a reality in Uttarakhand.
Merely abolishing the concept of coparcenary property would also not have been enough. The UUCC would have to tackle how interests in existing coparcenaries are to be divided once it comes into force. For instance, Kerala provided for a ‘deemed partition’ of the entire coparcenary property, giving each coparcener an equal share, which they would hold separately as full and complete owners. In the absence of an express provision, millions of Hindus would suddenly find themselves deprived of the shares in their ancestral properties that could now belong solely to the family patriarch.
What will be the likely outcome?
A UUCC that has the legal community divided about the status of coparcenary property will likely lead to massive litigation. Property is the most heavily litigated area in India, with succession and partition disputes at its core. Even when the HSA was amended in 2005, the Supreme Court was required to step in on multiple occasions — issuing lengthy judgments to clarify the law — ironically muddling it further.
The UUCC will most certainly give rise to questions surrounding the intention of the lawmakers. Did the state legislature really intend to abolish the coparcenary system? If they did not, why did they add interest in ancestral property in the definition of estate? And if they did, why did they not abolish the right by birth and further clarify the incidents attached to coparcenary property? This will be a veritable paradise for family and tax lawyers, leaving the estates of Hindu, Buddhist, Sikh, and Jain joint families in disarray.
The UUCC is a missed opportunity for the state to have undertaken the task of actually reforming and streamlining the law of succession for Hindus while aligning it with modern socio-legal realities. Instead, it is a confused attempt at reshuffling the order of intestate succession within the traditional framework of Hindu law which may lead to unintended chaos, all under the garb of a “uniform” civil code.
The authors are with the Vidhi Centre for Legal Policy. Views are personal.
(Edited by Humra Laeeq)