Whether court can infer existence of joint family property if two brothers are carrying on business jointly?

 The law is well settled that the burden is on the person who alleges that the property is a joint property of an HUF to prove the same. Reference in this behalf may be made to the judgments of this Court in Bhagwan Dayal v. Reoti Devi MANU/SC/0374/1961 : AIR 1962 SC 287. Both the parties have placed reliance on the this judgment. In this case this Court held that the general principle is that a Hindu family is presumed to be joint unless the contrary is proved. It was further held that where one of the coparceners separated himself from other members of the joint family there was no presumption that the rest of coparceners continued to constitute a joint family. However, it was also held that at the same time there is no presumption that because one member of the family has separated, the rest of the family is no longer a joint family. However, it is important to note that this Court in Bhagwati Prasad Sah and Ors. v. Dulhin Rameshwari Kuer and Ors. MANU/SC/0060/1951 : (1951) 2 SCR 603, it held as follows:

.... Except in the case of reunion, the mere fact that separated coparceners chose to live together or act jointly for purposes of business or trade or in their dealings with properties, would not give them the status of coparceners under the Mitakshara law.

The Privy Council in Appalaswami v. Suryanarayanamurti MANU/PR/0051/1947 : I.L.R. 1948 Mad. 440 held as follows:

The Hindu law upon this aspect of the case is well settled. Proof of the existence of a joint family does not lead to the presumption that property held by any member of the family is joint, and the burden rests upon anyone asserting that any item of property was joint to establish the fact. But where it is established that the family possessed some joint property which from its nature and relative value may have formed the nucleus from which the property in question may have been acquired, the burden shifts to the party alleging self-acquisition to establish affirmatively that the property was acquired without the aid of the joint family property

The aforesaid view was accepted by this Court in Shrinivas Krishnarao Kango v. Narayan Devji Kango and Ors. MANU/SC/0126/1954 : (1955) 1 SCR 1. In D.S. Lakshmaiah and Ors. v. L. Balasubramanyam and Ors. MANU/SC/0639/2003 : (2003) 10 SCC 310 this Court held as follows:

The legal principle, therefore, is that there is no presumption of a property being joint family property only on account of existence of a joint Hindu family. The one who asserts has to prove that the property is a joint family property. If, however, the person so asserting proves that there was nucleus with which the joint family property could be acquired, there would be presumption of the property being joint and the onus would shift on the person who claims it to be self-acquired property to prove that he purchased the property with his own funds and not out of joint family nucleus that was available.

Similar view was taken in Mst Rukhmabai v. Lala Laxminarayan and Ors. MANU/SC/0186/1959 : (1960) 2 SCR 253 and Appasaheb Peerappa Chamdgade v. Devendra Peerappa Chamdgade MANU/SC/8597/2006 : (2007) 1 SCC 521. The law is thus well settled that the burden lies upon the person who alleges the existence of the Hindu Undivided Family to prove the same.

11. Normally, an HUF can only comprise of all the family members with the head of the family being karta. Some property has to be the nucleus for this joint family. There is cleavage of opinion as to whether two brothers of a larger group can form a joint family. But assuming that such a joint family could have been formed by Madhav Prashad and Umrao Lal the burden lies heavily on the Plaintiff to prove that the two of them joined together to form an HUF. To prove this, they will have to not only show jointness of the property but also jointness of family and jointness of living together.

IN THE SUPREME COURT OF INDIA

Civil Appeal Nos. 6875 and 6876-6877 of 2008

Decided On: 03.04.2020

Bhagwat Sharan (Dead) thr. L.Rs.  Vs. Purushottam and Ors.

Hon'ble Judges/Coram:

L. Nageswara Rao and Deepak Gupta, JJ.

Citation: MANU/SC/0354/2020, 2021(1) MHLJ 485

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Whether a son conducting business with father can claim that it is a joint family business if father has started the said business with his self-acquired property?

In Ramaswami Nayakar v. Raja Padayachi MANU/TN/0247/1925 : AIR1926Mad963 , it has been held that the question whether the self-acquired property of a member of a joint Hindu family has been thrown by him into the common stock or not is a question of fact. In Pearey Lal v. Nanak Chand MANU/PR/0008/1948 : (1948) 61 L.W. 437, the Privy Council had to consider a case where a father, who had no ancestral property, started a business and his son claimed that by reason of his association in the business the character of the business became a joint family business. It has been held in that decision that the onus of proving that the separate business of the father became joint family business, especially when there is no-ancestral property, is heavy on the son and that it is for the son to prove that he was associated in the business in such a manner as to raise a reasonable inference that the father intended to make and did make his business a joint family business.  {Para 10}

IN THE HIGH COURT OF MADRAS

Decided On: 21.11.1969

 P.L.N. Paramasivam Vs.  P.K. Ramaswami Gounder and Ors.

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Whether there is presumption that business standing in name of any member of joint family is joint family business?

THERE IS NO PRESUMPTION THAT A BUSINESS STANDING IN THE NAME OF ANY MEMBER OF THE JOINT FAMILY IS A JOINT FAMILY BUSINESS.

46. It is also settled law that there is no presumption that a business standing in the name of any member of the joint family is a joint family business. The Supreme Court in P.S. Sairam & Am. Vs. P.S. Rama Rao Pissey & Ors. MANU/SC/0085/2004 : (2004) 11 SCC 320 has held as under:-

"7. Crucial question in the present appeal is as to whether business which was conducted by defendant No. 1 was his separate business or it belonged to joint family, consisting of himself and his sons. It is well settled that so far as immovable property is concerned, in case the same stands in the name of individual member, there would be a presumption that the same belongs to joint family, provided it is proved that the joint family had sufficient nucleus at the time of its acquisition, but no such presumption can be applied to business. Reference in this connection may be made to a decision of this Court in the case of G. Narayana Raju v. G. Chamaraju: MANU/SC/0113/1968 : AIR 1968 SC 1276 wherein in a suit for partition defence was taken that business of Ambika Stores was separate business of defendant as the business did not grow out of joint family funds or at least by efforts of members of joint family which was accepted by the trial court as well as the High Court. When the matter was brought to this Court in appeal, upholding the judgment of the High Court, the Court observed thus at page 466:- (AIR p. 1278, para 3)

"It is well established that there is no presumption under Hindu Law that a business standing in the name of any member of the joint family is a joint family business even if that member is the manager of the joint family. Unless it could be shown that the business in the hands of the coparcener grew up with the assistance of the joint family property or joint family funds or that the earnings of the business were blended with the joint family estate, the business remains free and separate."

(emphasis supplied)

IN THE HIGH COURT OF DELHI

CS (OS) 2223/2013, 

Decided On: 04.02.2019

Aarshiya Gulati  Vs.  Kuldeep Singh Gulati and Ors.

Hon'ble Judges/Coram:

Manmohan, J.

Citation: AIR 2019(NOC) 577 Del
Read full judgment here: Click here

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When tenant should not be evicted on ground of change of user from one business to another business?

 The main point urged on behalf of the Appellant is that
the premises which was let out for saw mill is now being
utilized for the purpose of manufacturing of grills which
amount to change of user. Submissions were made before
us by both sides on the interpretation of terms of the rent
agreement. On a perusal of the agreement, we are
convinced that there is no restriction placed on the
Respondents-tenant to run business only relating to the
saw mill. The tenant was given the liberty to carry on any
other business as well. In the absence of any negative
covenant the user does not amount to user for the purpose
other than for which the premises was leased.
Non - Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
Civil Appeal No.9598 of 2018

RAVI CHAND MANGLA Vs DIMPAL SOLANIA & ORS.

Dated:SEPTEMBER 18, 2018

L. NAGESWARA RAO, J.

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When illegal activity can be treated as business?

Any activity carried on continuously and systematically by a person by the application of his labour or skill in order to earn an income is 'business'--ratio of Supreme Court judgment in the case of Barendra Prasad Ray v. I.T.O. The activities of the Jain brothers, even if considered illegal, were therefore 'business' activities, hence the entries recorded in MR 71/91 make it a book of account kept in the course of business. "..........in Barendra Prasad Ray v. I.T.O. ...........this Court observed that the word 'business' is one of wide import and it means an activity carried on continuously and systematically by a person by the application of his labour or skill with a view to earning an income. The activities of the Jain brothers, as sought to be projected by the prosecution now on the basis of the materials collected during investigation (detailed earlier) would, therefore, be 'business' for they were being carried on continuously in an organised manner, with a set purpose (be it illegal) to augment their own resources. MR 71/91 is, therefore, a book of account kept in the course of business."

IN THE SUPREME COURT OF INDIA

Crl. A. Nos. 247-256 of 1998 (arising out of SLP (Crl.) Nos. 1716-1725 of 1997

Decided On: 02.03.1998

Central Bureau of Investigation Vs.V.C. Shukla & Ors.

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