Under Section 25 of the Contract Act, 1872, if an agreement is expressed in writing and registered under the law for the time being in force for registration of documents, and is made on account of natural love and affection between parties standing in a near relation to each other, then such agreement is not void even if there is no consideration.
In your case, an amount of Rs. 101 is just a token amount and is not a valid consideration for the sister to relinquish her share in the property keeping in view the fact that the value of the property is more than Rs. 1 crore. However, if the sister does this “on account of natural love and affection” for her brother who stands in a near relation to her, then such agreement will not be void since it is in writing and is registered. It will be valid.
In a similar situation, in the case of Ranganayakamma v. K.S. Prakash, (2008) 15 SCC 673, the Supreme Court held that a deed of “release” for a consideration is a transaction. When, thus, a release is made for consideration, the particulars of consideration and other particulars which are required to be averred in the deed are essential elements thereof. The Supreme Court held that a relinquishment of a property by a sister in favour of her brother for a consideration or absence of it, stands on a different footing. Section 25 of the Contract Act must be read and construed having regard to the fact situation obtaining in the cases.
Dr. Ashok Dhamija is a New Delhi based Supreme Court Advocate and author of law books. Read more about him by clicking here. List of his Forum Replies. List of his other articles. List of his Quora Answers. List of his YouTube Videos.
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