In a Supreme Court divorce case, a wife received a flat near Mumbai without paying stamp duty on the transfer. On February 28, 2025, the husband won the case without any alimony obligations. However, the court directed him to give up all rights to the Godrej flat. It ruled that the wife is exempt from stamp duty under Section 17(2)(vi).
New Delhi: In a recent Supreme Court case, a husband secured a long-awaited divorce without having to pay alimony, but this victory came with a significant condition: he agreed to transfer ownership of his flat, located near Mumbai, to his wife.
The case did not become protracted across multiple courts, as both parties opted to file directly under Article 142 of the Constitution of India for divorce.
Initially, the couple filed a divorce petition at the Bandra Family Court in Mumbai. However, during the proceedings, the husband sought to transfer the case from Bandra to the Karkardooma District Court in Delhi. While this transfer petition was pending, they were referred to mediation. When mediation proved unsuccessful, both the husband and wife submitted separate applications under Article 142 for the dissolution of their marriage by mutual consent.
According to the Supreme Court’s order dated February 28, 2025, the divorce case could not move forward because neither party was willing to sign a divorce compromise settlement. The couple was embroiled in a dispute over the ownership of the flat near Mumbai.
The Supreme Court noted,
“The bone of contention between the parties is a flat of joint ownership. Claims and counterclaims have been made by the parties regarding the source of funds utilized for acquiring the flat in question.”
The husband agreed to relinquish his rights to the disputed flat in favor of his wife, who consented to the divorce without seeking alimony.
The Supreme Court’s order noted,
“It may be noted that both the parties are highly qualified and well-established in life.”
Ultimately, the husband reached a compromise by completely giving up his rights to the flat, which the Supreme Court affirmed.
In its ruling, the Supreme Court instructed that the ownership of the flat would henceforth belong solely to the wife, free of any encumbrances.
The court stated,
“The petitioner-husband shall not be entitled to claim any rights or privileges in relation to the said flat hereinafter. The respondent-wife shall not claim any amount towards alimony or any other amount from the petitioner-husband.”
Moreover, the Supreme Court exempted the wife from paying stamp duty for the flat acquired as part of the divorce settlement. The court analyzed the case, referencing the precedent set in Mukesh v. The State of Madhya Pradesh & Anr., which held that exemptions from registration fees are provided under Section 17(2)(vi) of the Registration Act, 1908, as long as the decree pertains to the immovable property in question.
The Supreme Court noted,
“Manifestly, the flat-in-question is the subject matter of the compromise and as a consequence, it forms part of the proceedings before this Court. Hence, the exclusion provided by Section 17(2)(vi) of the Registration Act, 1908 will apply.”
The court further explained that the transfer of ownership to the wife would be executed free from any financial, legal, or third-party claims, with no further obligations from the husband concerning the property.
Advocate Niharika Gupta, senior associate at The Young Jurist, stated,
“The legal provision (Section 17(2)(vi) of the Registration Act, 1908) exempts court-ordered transfers from stamp duty, provided that the decree pertains specifically to the immovable property in dispute, which is the case here.”
In its judgment, the Supreme Court directed the Sub-Registrar to register the flat in the exclusive name of the wife, allowing the applications under Article 142 of the Constitution of India.
The court declared,
“Accordingly, the marriage of the parties is dissolved by mutual consent.”
Arnaz Hathiram, a digital media professional, remarked,
“This marriage has been dissolved by mutual consent under Article 142 of the Constitution. The contested divorce was turned into mutual consent once the husband agreed to give up his right in the property.”
While the Supreme Court waived the stamp duty for the wife, it clarified that she may still be responsible for other property-related charges. These could include registration fees, society transfer charges, property taxes, and maintenance fees.
Gupta stated that the husband is also not liable for stamp duty, emphasizing,
“Since the Supreme Court has categorically declared that the flat shall vest in the wife’s name without encumbrance, the husband has no further financial obligations regarding the property, including stamp duty payments.”
Raunak Dhillon, Partner at Cyril Amarchand Mangaldas, stated,
“The Supreme Court has found that the exemption from payment of fees for registration under Section 17(2)(vi) of the Registration Act, 1908, would be applicable to the facts of the case.”
Alay Razvi, Managing Partner at Accord Juris, highlighted the limitations of this judgment, noting that if the transfer occurs through a private settlement deed or if the husband gifts the property instead of a court-ordered settlement, stamp duty exemptions will not apply.
Experts reflect on the significance of this ruling, emphasizing its implications for future settlements. Pranav Bhaskar, Partner and Head of Corporate Practice at SKV Law Offices, stated that the judgment reaffirms that property transfers resulting from court orders in non-compromise cases are exempt from stamp duty, providing relief to parties undergoing legal settlements.
Vipul Jai, Partner at PSL Advocates & Solicitors, remarked that this ruling will significantly affect cases involving mutual consent decrees, ensuring that one party’s willingness to relinquish ownership does not impose an undue financial burden on the other.
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