Fraud U/S 23(1) Senior Citizens Act Limited To Breach Of Condition Of Upkeep Of Transferor, Can't Be Enlarged To Fraud In Civil Law: Karnataka HC

The Karnataka High Court has made it clear that the concept of fraud or coercion incorporated in the Section 23 (1) of the Maintenance and Welfare of Parents and Senior Citizens Act, 2007, to be the ground to declare the gift deed as void is limited to the breach of condition that the transferee shall provide basic amenities and physical needs to the senior citizen-transferor.A division bench of Chief Justice N V Anjaria and Justice Krishna S Dixit set aside a part of the order passed by the tribunal whereby it had allowed the complaint filed by K. V. Nanjappa setting aside the gift deed executed by him in favour of his son Jayashankar. The tribunal had noticed that the complainant-K.V.Nanjappa had put his thumb impression on the registered document, whereas on the other hand, he had signed on the order sheet of the complaint. It had thus the view taken that when the complainant-father was capable of subscribing the signature to any document, serious doubts were created when he put his thumb impression on the gift deed. The gift deed was treated to be void with such finding and came to be cancelled in exercise of the powers under Section 23(1) of the Act. The single judge bench had upheld the order. The division bench however said,“The words 'fraud and coercion' mentioned in the Section could not be enlarged to the normal concept of 'fraud' or 'coercion' in civil law. In order to establish 'fraud' or 'coercion' a foundation of established facts is needed to conclude about 'fraud' as understood in common legal parlance, establishing a fraud or fraudulent conduct by any person would indispensably require leading of evidence to prove the facts of fraud. For the purpose of Section 23(1), fraud is that the transfer is effected and the condition therein about providing basic amenities and physical needs to the transferor by the transferee, is not observed and abided by the transferee.” It added “It will not be permissible in law for the Tribunal, while exercising powers under Section 23(1) of the Act, to pronounce upon generally that the transfer of the property by way of gift or otherwise was fraudulent or that the transferor was guilty of fraud or coercion in the general sense of the term. The rights and obligations arising for the parties in the context of commission of fraud as is to be applied in general law, are the civil disputes. It is not open for the Tribunal functioning under the Act to pronounce upon such fraud having committed in effecting the transfer.” Court held that the Tribunal misdirected itself by suggesting that the gift deed was fraudulently obtained from the complainant. "The aspects mentioned by the Tribunal in that regard are to be proved by leading evidence. It was not permissible for the Tribunal to arrive at a different finding in that regard. Even otherwise, recording of such a finding was beyond the powers and jurisdiction of the Tribunal.” Nonetheless court dismissed the appeal on finding that appellant had undertook to take care of the father and on such condition the gift deed was executed. However, the petitioner had admitted about the father not residing with him."Therefore, condition of taking care of the father was manifestly breached. The complainant-father had to stay at the residence of the elder son. The condition of treating the gift deed void was satisfied. In that regard, therefore, no error could be said to have been committed by learned Single Judge in confirming the order of the Tribunal treating the gift deed as cancelled. It was proper exercise of powers to that extent under Section 23(1) of the Act,” it held.Appearance: Advocate Vikas M for Appellant. AGA Niloufer Akbar for R1. Advocate Usha Prakash for R2. Citation No: 2024 LiveLaw (Kar) 203 Case Title: Jayashankar AND The Assistant Commissioner & Others Case No: WRIT APPEAL NO.339 OF 2023.Click Here To Read/Download Order

Fraud U/S 23(1) Senior Citizens Act Limited To Breach Of Condition Of Upkeep Of Transferor, Can't Be Enlarged To Fraud In Civil Law: Karnataka HC

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