The Supreme Court stated that consideration doesn’t always have to be money; it can take other forms too.
The Supreme Court emphasized that consideration can take forms other than money. It overturned the Madras High Court’s decision, reinstating the findings of the Trial Court and the First Appellate Court. The case involved the appellants disputing a claim for a 2/3rd share of a property based on a settlement deed from 1963. Justices C.T. Ravikumar and Sanjay Karol noted that legal provisions indicate that consideration does not have to be monetary; it can be in different forms. In this case, the property transfer to Govindammal acknowledged her care for the transferors and her commitment to continue that care while also engaging in charitable activities.
The appellants argued that the lower courts rightly dismissed the oral partition and that the High Court typically does not challenge concurrent factual findings. The respondents contended that the document, although labeled a settlement deed, was essentially a gift deed, arguing that the title of the document was not significant. The Supreme Court focused on whether the 1963 deed was a gift or a settlement deed. Citing the Transfer of Property Act, 1882, the Court referenced the Indian Contract Act, 1872, highlighting that consideration can exist in forms other than money.
The Court referenced its ruling in CIT v. Ahmedabad Urban Development Authority (2023), stating that consideration means a fair equivalent or valuable benefit given by the promisor to the promisee or by the transferor to the transferee. When “consideration” is described as “sole,” it emphasizes that it is adequate and valuable based on the case’s facts and circumstances. Therefore, the Court concluded that the High Court mistakenly took a narrow view of “consideration,” especially since the settlement involved family members. Additionally, the High Court needed to show that overturning the consistent findings of the lower Courts was warranted. The ability to challenge findings where the lower Courts agree is limited, and this limitation is clearly defined. As a result, the Supreme Court granted the Appeal.
Cause Title: Ramachandra Reddy (Dead) Thr. Lrs. & Ors. v. Ramulu Ammal (Dead) Thr. Lrs. (Neutral Citation: 2024 INSC 868)
