This article is written by Kunwar Abhijeet, Legal Trainee in Aditya Pratap Law office, Mumbai and Prerna Mitra, Practicing Advocate in Siliguri, West Bengal. This article discusses the division of matrimonial property after the dissolution of marriage among the husband and the wife.
In today’s world, owning property is the symbol of wielding power and success in society. The more property one owns, the higher their sense of security. But a question that surfaces in recent times is what happens to the ownership of a matrimonial property following a divorce? In a country like India which suffers from a lack of laws to tackle this aspect of life, does divorce incite a power struggle between the spouses to command ownership of the property, or does it paralyze a housewife perpetually, despite all her efforts put in to maintain the household during the marriage?
A nation’s history and its culture dictate the nature in which matrimonial property can be owned between a man and his wife. Over the course of time, man has introduced a more structured manner in which matrimonial property can be owned by the spouses, keeping in mind the age-old practices that were prevalent.
Consequently, now there are models based on which ownership of matrimonial properties are determined in different countries. There are two models that are widely followed across the globe and are classified as: Separate ownership and Community ownership Models. On a cursory reading of these models, it will be abundantly clear that both these models have their own set of advantages and disadvantages.
Separate ownership of property
As the name itself implies, the ownership of matrimonial properties under this model is separate. To elaborate upon it, if any property is bought by a spouse, be it before or after marriage, then that property is retained by that spouse even after the dissolution of the marriage and the other spouse cannot claim a right over such property.
This model is practical and will prove to be immensely efficacious if practiced in countries where both the spouses are financially independent and have a stable source of sustaining livelihood. As a result of this, even after the dissolution of their marriage, both the spouses can continue living the way they did when they were married, thereby, negating every possibility of tension between the spouses over the property they own, once their marriage is dissolved.
This model stands as a testament to the concept of individualism. The courts in the countries that follow this model can easily distribute the properties among the spouses on the basis of title deed of the property.
England is one such country that adheres to the principle of this model of dividing the marital property among the husband and wife based on the title deed of the property:
Community ownership of property
Under this model, the property is assumed to be commonly owned by the spouses and after separation, its shares are equally divided between the husband and the wife. The guiding principle behind this model is that it is believed that both the spouses contribute equally to the common fund through which properties are bought. This model not only recognizes financial contributions made towards buying a property, but also gives weightage to non-financial contributions from the spouses.
For instance, if the husband bought the house in his name and the wife takes care of the house then it would be assumed that both the spouses are equal and joint owners of the house. Eventually, in case where spouses decide to separate then the shares of the property will be equally divided among the spouses.
The model helps to accord financial security to the non-working spouse. It recognizes the non-monetary efforts put by the spouses which are imperative to run a household. Few countries like Sweden and France follow this model.
In India, the courts follow Separate ownership model of matrimonial property distribution. Thus, it does not come off as a shock to state that in India the non-financial contribution of the spouses is not recognized.
Conundrum of Benami Transaction
In India, generally if the property is bought by a person but in the name of his/her spouse then it falls within the brackets of a benami transaction and it is governed by the Prohibition of Benami Property Transactions Act, 1988(hereinafter referred to as “the Act”). Section 4 of this Act explicitly prohibits the right to recover a property held benami.
To emphasize upon it further, if a husband buys a property in the name of his wife then the husband will not be allowed to claim title over that property as per Section 4 of this Act, as it will be considered as a benami transaction.
However, there is a silver lining to it after all, if the husband is able to prove that the consideration paid for purchasing the property in the name of his wife was paid by him from known sources of the husband, then Section 4 will not be applicable in this situation. This contention can be further buttressed on Section 2(9) A (iii) of the Act, which precisely delineates that if the individual’s property is held in the name of his spouse and the consideration for that property is paid out of known sources of the individual then it won’t be considered as benami transaction, and Section 4 only follows if it is a benami transaction. Thus, under this circumstance, the husband will be able to claim the title over the property irrespective of the fact that the property is in the name of his wife.
Section 27 of the Hindu Marriage Act, 1955
After divorce, when the Hindu married couple isn’t able to divide the marital property among them amicably due to an absence of a possible agreement, the competent court distributes the property as per Section 27 of the Hindu Marriage Act, 1955. The court needs to divide the shares of the property in just and proper manner.
The Hon’ble High Court in the case of Surinder Kaur v. Madan Gapal Singh, while explaining the position of Section 27 clarified that it includes not only the property which are presented to any of the spouse at the time of marriage but also at any time before or after the marriage.
Therefore, a property bought by the husband after marriage in the name of the wife falls under the ambit of Section 27 and the competent Court has the power to divide the marital property in a just and proper way among the spouses.
Standard operating procedure
The Honorable Courts of India have been following a common practice of dividing the marital property based on ownership and individual contribution. The first and foremost question that the court asks before dividing the property is who has the ownership i.e. title over the property.
A catena of judicial precedent on this matter has been discussed as follows:
Joint ownership – Both contributed
If there is a joint ownership over the property then it would be divided proportionally based on the contribution by each of the two spouses. To determine the share of each spouse, the court takes into consideration individual equity over the property. For instance, if the husband and the wife have joint ownership over a property X, where the husband had contributed 40% and the wife had contributed 60% of the required amount to buy that property X, then the court would determine the current value of the property X and distribute the shares proportionally based on the percentage amount contributed by each of the spouses.
Joint ownership – Only one contributed
In case, where there is joint ownership over the property but only one of the spouses has paid for it then the court needs to scrutinize the matter before distributing the property. Generally, in this case, shares of the property get divided equally among the spouses. But if one of the spouses successfully proves in the court that he/she has paid the full amount from his/her known sources, then he/she might acquire the whole property in dispute, irrespective of the joint ownership.
Unfortunately, in India, the law does not acknowledge the non-financial contributions made by the spouse. Owing to this grey area in our legal system, many of the Indian housewives who non-financially contribute in the property for the entirety of their married lives to manage and maintain the household fail to acquire any part of it after a divorce.
A similar scenario was highlighted in the case of Sri Arun Das v. Smt. Aparna Das where the sale deed of the property contained names of both the husband and the wife. After divorce the wife filed for partition of the suit into 50:50 ratios. The court after scrutinizing the bank details found out that the entire consideration money was paid by the husband which puts the wife in fiduciary capacity vis-à-vis husband. The court held that the wife was like a trustee of the property and as the husband contributed money for the property he becomes the sole owner of the property, irrespective of the fact that the wife’s name was on the sale deed.
One has title but the other one contributed
The most controversial is the last category where the property purchased is in the name of one spouse but the whole amount is paid by the other spouse. In these situations the Court first determines whether it is a benami transaction or not. At the outset, this issue has been already addressed. In a nutshell, if the spouse who purchased the property proves that he purchased from his known sources then it will not be a benami property.
Nevertheless, if the property is registered solely in the name of one of the spouse then she/he will be able to claim it entirely. But on the contrary, if the other spouse adduces evidence to prove that he/she contributed for the purchase of the property then he/she will be legally eligible to claim the property. But the burden of proving the financial contribution by preponderance of the evidence is on the spouse whose name is not on the title deed. So once the contribution is proved the court divides the share of the property as per the amount paid towards the purchase by each spouse.
In a recent case of Debika Chakraborty v. Pradip Chakraborty, at the time of property division after divorce it was found that a property was in the name of the wife. But the husband proved that the money through which the property was bought came into the wife’s account from the personal account of the husband or from his private limited companies. The husband further satisfied the court that there was a fiduciary relationship between the spouses and the property was held by the wife as a trustee. The husband also argued that the property was bought for his own benefit and for his family. After hearing both the parties, the Calcutta High Court gave the decree in the favor of the husband. Hence, the husband acquired the property, irrespective of the fact that the wife had title over the property.
Conclusion and suggestions
In Indian scenario, by and large, the distribution of assets between the spouses on divorce is based on the ownership title. But if the spouses are able to proof their financial contribution in buying the disputed property then the shares of the property would be divided on individual equity. The spouse should mandatorily adduce evidence of his known sources through which he contributed in buying the property. This is an indispensable condition before claiming shares on the property when a spouse does not have his/her name on the title deed.
Currently, it is unfortunate that we are bereft of any law which particularly focuses on matrimonial property and its fate in the event of a divorce. It is left to the courts to use their discretionary power to divide the property among the spouses which mostly rely on ‘separate ownership of property’ principle.
The term “Matrimonial Property” is not defined in any law which leads to confusion while dividing the property after divorce. At present the provision which vaguely deals with matrimonial property is Section 27 of the Hindu Marriage Act, 1955. The problem with this provision is that it is very short to comprehend the intention of the legislature. While contemplating this particular provision, the Courts have time and again given contradictory observations which make this provision a dubious one.
The legislature should promptly draft laws dealing with ‘matrimonial property’ and comprehensively explain the types of property which should be included in ‘matrimonial property’. Furthermore, the Indian Courts ought to follow ‘common ownership of property’ principle instead of ‘separate ownership of property’ principle in order to uplift the status of Indian housewives.
A recent study has shown that women’s contribution to the GDP of India is just 17%. Also what is striking is the fact that 60% of women in India have no valuable assets in their name. This data clearly depicts the unfortunate condition of women in India. A patriarchal society engulfed by its conservative thinking is the primary reason for women’s plight.
To ameliorate the position of women in India and to provide financial security to them, the courts ought to follow ‘ ‘common ownership of property” principle. This will recognize the non-monetary contribution towards the property by the housewives and will promote a sense of equality among the spouses.
To conclude, a housewife’s contribution in maintaining a household can’t be put on a pedestal that is lower than the husband’s monetary contribution to that effect. Thus, it is correctly said that “A world without women is a world that wouldn’t exist” let alone a household.
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