Gokeda Lateharao v. Viswanadham Bhimayya

Subba Rao, C.J.:-

(1) I think this is a case which mm i be heard by a bench, as there is no authoritative decision covering the question raised in the case. The suit out of which the second appeal arose was instituted on foot of two promissory notes. Exhibit a - 1 dated 14th june, 1947, for rs. 1500 and exhibit a - 2 dated 10th august, 1947, for rs. 1,000 executed by the defendant in favour of plaintiff. The defence to the suit was that the promissory notes were executed when the defendant was a minor and that the suit notes were not supported by consideration.

(2) The plaintiff relied on a fraudulent misrepresentation made by the defendant regarding his age and he also raised the contention that the amount was supplied for the necessaries of the defendant and his family. The trial court found that as admitted by the defendant only rs. 250 was received under the promissory notes by the defendant and that the balance of the consideration was not paid. It was also found that the defendant as a minor on the date of the execution of the promissory notes and that there was no fraudulent misrepresentation regarding the age. On these findings, he dismissed the plaintiff's claim.

(3) On appeal, the lower appellate court found that the defendant received full consideration under the promissory notes ; that he was a minor on the date of the execution of the promissory notes and that there was a misrepresentation by the defendant regarding his age on the date of the execution of the notes. It granted a decree against the defendant for the full amount applying section 65 of the indian contract act and held that as the agreement was discovered to be void the defendant should return the advantage received under exhibits a - 1 and a - 2.

(4) The principal question for consideration in second appeal is, assuming that the finding regarding the payment of the consideration is true the decree against the defendant granted by the lower court could be justified in law. Mr. Rama rao wanted to atttack the finding regarding the payment of consideration and also the finding of the learned judge that there was misrepresentation by the defendant at the time of the execution of the notes regarding his age. As i am referring the entire', case before a bench, no useful purpose would be served by going into the question, whether there is any justification for upsetting the findings of fact arrived at by the lower appellate court.

(5) Section 65 of the contract act has no application because as pointed out by the privy council in moharibi bi v. Dharmados ghosh. , (1902) l. R. 30 i. A. 114 : i. L. R. 30 cal. 539 (p. C.). Both the agreement and the contract contemplated by section 65 must be between persons who are sui juris and has no application to the agreement by a minor. If section 65 has no application, under the principles established in england in leslie limited v. Sheill', l. R. (1914) 3 k. B. 607. No relief can be granted in favour of the plaintiff against the defendant. But, apart from equitable principles applicable to a situation like this which were established in england, we have the statutory provision in section 41 of the specific relief act which; was applied in cases where the plaintiff sought cancellation of an instrument and if it was found that he had derived any advantage under the instrument he must return the advantage before he recovers the property in consequence of the cancellation of the instrument. Reading section 41 in collocation with sections 38 and 39, it would appear that section 41 would apply only to cases where at the instance of the plaintiff the instrument is cancelled though the language of section 41 by itself is wide enough to cover a case where the document is cancelled or declared void at the instance of the defendant as well. This was the view accented bv the allahabad high court in ajudhia prasad v. Chandan lal,i. L. R. (1937) all. 860. And also in hanumantharao v. Seetharamayya, (1939) 2 m. L. J. 195: i. L. R. (1939) mad. 203. That the same principle might be applied even to the case of a defendant and this view was based largely upon the observations of sir shadi lal, c. J. In khan gul v. Lakha singh. , (1928) i. L. R. 9 lah. 701 (f. B.).

(6) This last - mentioned case was subjected to severe criticism by sulaiman, g. J. In ajudhia prasad v. Chandan lal. , i. L. R. (1937) all. 860. There is, however, no decided case which considers all the aspects of the question and decided whether in the circumstances relief could be granted under section 41 of the specific relief act in a case where the defendant impugns the document and establishes that it is void. It is also a point for consideration whether though section 41 in terms does not apply there is any room for extending the principle underlying the section to the case of the defendant. In england, since the decision in leslie limited v. Sheill,l. R. (1914) 3 k. B. 607. A more liberal view regarding the doctrine of unjust enrichment and the limitation under which it could be applied so as to grant restitution was taken. These are all matters which must receive consideration and there should be an authoritative pronouncement of this court on the question. So far as i am aware, this is the first case of its kind in this court. I, therefore suggest that the matter may be placed before a bench subject to the orders of the hon'ble the chief justice.

(7) This second appeal has been referred to a bench the facts are simple and may be stated. The appellant executed two promissory notes exhibit a - 1, dated 14th june, 1947 for rs. 1, 500 and exhibit a - 2, dated 10th august, 1947 for rs. 1,000 in favour of the respondent. The appellant was a minor at the time the promissory notes were executed but he made a fraudulent representation to the respondent that he was a major. A suit was filed in the district munsif's court peddapuram to enforce the said two promissory notes. The appellant, inter alia, contended that the suit promissory notes were not supported by consideration and that they were not enforceable as he was a minor on the date of their execution.

(8) The learned district munsif and, on appeal, the learned subordinate judge kakinada, held that the appellant was a minor on the date of the execution of the promissory notes. The subordinate judge further held that he made a fraudulent misrepresentation of his age. The district munsif found that the promissory notes were supported by consideration of rs. 250, whereas the appellate court came to the conclusion that the entire money was paid under the promissory notes. The appellate court, in modification of the first court's decree, applied the provisions of section 65 of the indian contract act and gave a decree in favour of the respondent for recovery of the entire amount due under the promissory notes. Hence, the appeal.

(9) The question that is raised before us is whether, in the circumstances stated above, the plaintiff can recover the amounts paid by him under the promissory notes to a minor. The relevant provisions may be extracted : section 65 of the indian contract act : -

"when an agreement is discovered to be void or when a contract becomes void, any person who has received any advantage under such agreement or contract is bound to restore it, or to make compensation for it to the person from whom he received it."

(10) Section 39 of the specific relief act : "any person against whom written instrument is void or voidable, who has reasonable apprehension that such instrument, if left outstanding, may cause him serious injury may sue to have it adjudged void or voidable ; and the court may, in its discretion, so adjudge it and order it to be delivered up and cancelled ". Section 41 : "on adjudging the cancellation of an instrument, the court may require the party to whom such relief is granted to make any compensation to the other which justice may require. " under section 65 of the contract act, a person, who has received any advantage under an agreement, which is void, or a contract which becomes void, is bound to restore the advantage received under the said agreement or contract or make comoensation for it. Section 39 of the specific relief act enables a person to apply for the cancellation of a written instrument as void and, in cancelling such an instrument, the court may, in its discretion, require the person, to whom the relief is granted to make any compensation to the other; learned counsel for the appellant contends that the defendant cannot be compelled to return the money received by him under section 65 of the contract act as that section applies only to contracts entered into between persons possessing contractual competency and that sections 39 and 41 of the specific relief act enable the court to impose a condition only on the plaintiff, who seeks for the relief of cancellation and do not empower the court to impose a condition on the defendant to restore the benefit to the plaintiff. The learned counsel for the respondent would contend that the court has jurisdiction both under section 65 of the contract act and under sections 39 and 41 of the specific relief act to direct the appellant to restore the advantage or the bencfit received by him from the plaintiff. Before we attempt to express our opinion on the question raised, it will be convenient at this stage to notice the views, vis - a - vis, the scope of the liability of a minor to return a benefit or advantage received by him under void contracts, expressed by learned authors on the subject and in leading decisions both in england and in india.

(11) In snell's principles of equity, 24th edition at page 504 the scope and the limits of equitable remedy against an infant has been summarised thus :

"when an infant obtained an advantage by falsely stating himself to be of full age, equity required him to restore his illgotten gains, or to release the party deceived from obligations or acts in law induced by the fraud but scrupulously stopped short of enforcing against him a contractual obligation, entered into while he was an infant even by means of a fraud."

(12) In chitty on contracts, 21st edition, a learned discussion on the subject is found in pages 605 to 608 and the learned author stated the legal position in words of lord sumner at page 607 thus :

"i think that the whole current of decisions down to 1913 (the date of stocks v. Wilson) apart from dicta which are inconclusive, went to show that when an infant obtained an advantage by falsely etating himself to be of full age, equity required him to restore his illgotten gains or to release the party deceived from obligations or acts in law induced by the fraud, but scrupulously stopped short of enforcing against him a contractual obligation entered into while he was an infant, even by means of a fraud. Restitution stopped where repayment began."

(13) The leading decision on the subject is leslie limited v. Shrill. , l. R. (1914) 3 k. B. 607. There, an infant by fraudulently representing that he was of full age induced the plaintiffs to lend him two sums of - 200 each. To an action by the plaintiffs to recover the amount of the advances on the ground that they had been obtained by fraudulent misrepresentation, or, in the alternative for money had and received by the defendant to the use of the plaintiffs, the defendant pleaded infancy. The court of appeal held that the cause of action was in substance ex contractu that the plea of infancy was a good answer to the action and that the defendant was under no equitable liability to the plaintiffs. The judgment delivered by lord sumner is not only illuminating but is also instructive. Some of the relevant passages may be usefully extracted. At page 619 lord sumner says :

"there is no fiduciary relation ; the money was paid over in order to be used as the defendant's own and he has so used it and, i suppose, spent it. There is no question of tracing it, no possibility of restoring the very thing got by the fraud, nothing but compulsion through a personal judgment to pay an equivalent sum out of his present or future resources, in a word nothing but a judgment in debt to repay the loan. I think this would be nothing but enforcing a void contract. So far at i can find, the court of chancery never would have enforced any liability under circumstances like the present, any more than a court of law would have done so, and i think that no ground can be found for the present judgment, which would be an answer to the infants' relief act. " kennedy, l. J. , at page 621 observed : "be that as it may, i am certainly of opinion that in the present case, where the defendant is an infant, the cause of action is in substance ex contractu and is so directly connected with the contract of loan that the action would be an indirect way of enforcing the contract. "

Lawrence, j. , graphically brought out the consequences of giving relief under the aforesaid circumstances against a minor thus at page 625 :

"it would be a simple thing for those who pray upon infants to obtain from them materials which could be used to support a charge of fraud as easy as obtaining the usual promissory note. The result would be that the infant would have both to establish his infancy and to face a charge of fraud."

(14) The learned judge distinguishes cases wherein the plaintiff sought the assistance of the court. At page 626, it was observed :

"there are no doubt many cases in which equity will give relief against frauds perpetrated by infants. Wherever the infant requires as a plaintiff the assistance of any court, it will be refused until he has made good his fraudulent representation. Wherever the infant is still in possession of any property which he has obtained by his fraud, he will be made to restore it to its former owner. But i think that it is incorrect to say that he can be made to repay money which he has spent, merely because he received it under a contract induced by his fraud."

(15) The madras high court held in a number of decisions that, in a suit filed by a quondam minor, after attaining majority, to set aside a sale or to cancel an instrument, the court can, in exercise of its discretion, impose conditions on him for returning the advantage received by him or for making good the misrepresentation made by him. See ragavayya v. Sibbayya, (1917) 7 l. W. 124. Appaswamy ayyangar v. Narayanaswami ayyar, (1930) 60 m. L. J. 117 : i. L. R. 54 mad. 112. Hanumantha rao v. Srthararmyya, (1939) 2 m. L. J. 195 : i. L. R. (1939) mad. 203. And venkanna naidu v. Syed villijan chisty. , (1950) 2 m. L. J. 587. Where the defendant was a minor wads. Worth, j. , in kunhabi v. Kalliani ammal, (1939) 2 m. L. J. 463 : a. I. R. 1939 mad. 881. Expressed the view that to hold that the minor as defendant to a suit on a void mortgage is bound to pray for its cancellation, and to restore the benefit received would be to give to the morigagee a right to enforce his void contract by compelling the m'nor to pray for cancellation. Krishnaswami ayyangar, j. , in hanumaatha. Rao v. Sitharamayya, , (1939) 2 m. L. J. 195 : i. L. R. (1939) mad. 203. Already referred to, made some observations at page 211 in regard to the question whether any conditions can be imposed on the quondam minor, who is a defendant in the case. The learned judge observes : "according to him section 41 is framed so as to afford relief only in a case where the minor himself as plaintiff seeks the assistance of the court and the section is inapplicable if he happens to be merely a defendant in a suit by the person who dealt with him when he was a minor. On the soundness of this argument it is unnecessary to express a final opinion as in this case the minor has come to court as plaintiff seeking the assistance of the court as such.

(16) When the question arises, it would be a matter for consideration whether such a marked difference in the substantive rights of parties could have been intended to be based on the accident of the claimant being a plaintiff or defendant and whether there is not implicit in the language of the section a rule of wider significance affording under proper circumstances relief to a purchaser or alienee irrespective of his being a plaintiff or defendant. "

(17) These observations are obiter and the learned judges have not expressed any definite opinion on the question posed by them. Though wadsworth, j. , in his judgment in kunhabi v. Kalliani ammal , (1939) 2 m. L. J. 463 : a. I. R. 1939 mad. 881. Referred to this passage, the learned judge distinguished the case before him on the ground that, in that case the defendant did not ask for any relief of cancellation. The question posed by the learned judges directly arises in the present case and, for reasons we will give at a later stege, we are not inclined to extend the scope of a statutory provision beyond its well - defined limits. Another division bench of the madras high court consisting of viswanatha sastri and balakrishna ayyar, jj. , in venkanna naidu v. Syed vilijan chisty, (1950) 2 m. L. J. 587. Also touched upon this aspect of the case but left it open. The learned judges observed at page 591 :

"the position of a minor defendant using his minority as a shield against a creditor or a mortgagee is differentiated in the decisions from his position as a plaintiff using his minority as a weapon of attack. We need not resolve the doubt that has been expressed in some of the decisions of this and other high courts whether the principle of section 41 of the specific relief act would not apply also to a case where the minor is a defendant (see khangul v. Lakha singh, i. L. R. 9 lah. 701 (f. B.). And hanumantha rao v. Sitharamayya, (1939) 2 m. L. J. 195 : i. L. R. (1939) mad. 203. Which poses the question but does not answer it). In the present case it is the minor that conies into court as a plaintiff and the maxim that he who seeks equity must do equity clearly applies."

(18) It is, therefore, clear that, though some observations indicate an inclination to extend the scope of the provisions of section 41 even to the case of a defendant who was a quondam minor, there is no direct madras decision expressing a definite view, applying the principle underlying section 41 to the case of a defendant. But, the decisions unanimously recognise a wide discretion in a court to impose a condition on the plaintiff, who seeks the court's aid for cancelling or declaring a document to which he was a party void.

(19) The other high courts held, under varying circumstances, that a quondam minor cannot be compelled by the plaintiff to compensate him for the advantage received by him by misrepresenting that he was a major. Where the plaintiff sued to recover the value of the goods sold to the defendant, who was a minor at the date of the transaction, the bombay high court held in motilal mansukharam v. Manekalal dayabhai, (1920) i. L. R. 45 bom. 225. And punjabai bhilasa v. Bhagvandas kisandas, a. I. R. 1929 bom. 89. That he cannot recover the price of the goods from the defendant. These decisions are based on the principle that section 65 did not apply to persons incompetent to enter into a contract.

(20) The nagpur high court in gulabchand v. Chunnilal, a. I. R. 1929 nag. 156. And tikkilal v. Komalchand, a. I. R. 1940 nag. 327. On the same principle held that money lent to a minor cannot be asked to be refunded. In gulabchand v. Chunnilal,a. I. R. 1929 nag. 156. At page 159 the learned judge observes :

"this point, however, need not be pressed and it will be sufficient to hold that, where a minor by fraudulent representation has obtained a specific object or property he can be ordered to make restitution upon the contract being declared void, though when only money has been lent, no decree can be passed against the minor either on the contract of loan or for money had and received to his use."

(21) This distinction between goods in specie and money lent is supported on the ground that, in the former case, when the contract is void, the plaintiff continues to be the owner of the goods and, therefore, he can recover them if they can be traced to the hands of the minor. Now we shall consider two full bench decisions, one of the allahabad high court in ajudhia prasad v. Chandan lal, i. L. R. (1937) all. 860. And the other of the lahore high court in khan gul v. Lakha singh7, the former expressing the view that section 41 or any other rule of equity cannot be invoked for compelling a defendant guilty of misrepresentation of his age at the time the contract was entered into to restore the advantage and the other holding that such a condition could be imposed. The law on the subject has been considered fully and exhaustively by these two full bench decisions and the divergent views have been brought into bold relief. It would be pedantic and even redundant to consider all the cases over again. We would therefore,, consider the principles deduced by the two full bench decisions and express our preference to the one or to the other.

(22) In khan gul v. Lakha singh, (1928) i. L. R. 9 lah. 701 (f. B.). The facts were : the plaintiffs purchased half a square from the defendant for a sum of rs. 17,500. As the defendant refused to deliver possession of the property, the plaintiffs sued for delivery of possession of the property, or in the alternative for a decree for recovery of the consideration amount together with interest or damages arising from breach of contract. The defendant pleaded minority. The court found that the defendant made a false representation that he was of full age. On those facts, the following two questions were referred to' the full bench. (1) whether a minor, who by falsely representing himself to be a major. Has induced a person to enter into a contract, is estopped from pleading his minority to avoid the contract. (2) whether a party, who, when a minor has entered into a contract by means of a false representation as to his age, can, whether he be defendant or plaintiff, in a subsequent litigation, refuse to perform the contract and at the same time retain the benefit he may have derived therefrom. On the first question, the full bench gave the answer in the negative. On the second question, the full bench is also equally clear that, when a contract has been induced by false representation made by an infant as to his age, he is liable neither on the contract nor in tort if tort is directly connected with the contract and is the means of effecting it and parcel of the same transaction. But they relied upon the equitable jurisdiction of the court to order restitution. At page 715, shadi lal, c. J. , says : "but a false representation by an infant that he was of full age gives rise to an equitable liability.

(23) The court while relieving him from the consequence of the contract, may, in the exercise of its equitable jurisdiction, restore the parties to the position which they occupied before the date of the contract. The equitable jurisdiction is founded upon the desire of the court to do justice to both the parties by restoring them to the status quo ante, and there is no real difference between restoring the property and refunding the money, except that the property can be identified but cash cannot be traced. " adverting to the argument that the jurisdiction can be exercised only in a case where the minor is the plaintiff but not when he is the defendant, the learned chief justice observes at page 719 :

"it is difficult to understand why the granting of an equitable remedy should depend upon a mere accident, namely, whether it is the minor or his adversary who has taken the initiative in bringing the transaction before the court. The material circumstances in both the cases are exactly the same. A contract has been entered into with an infant and,as it is an invalid transaction it must be cancelled. The court, however, finds that the infant has, by practising fraud upon the opposite party, received property or money ; and that justice requires that he should not retain the benefit derived by him from a transaction which has been declared to be ineffectual against him. The transaction has been wiped out. It is only fair that both the parties should revert to their original position. These considerations are, in no way, affected by the circumstance that one party, and not the other, has moved the court in the first instance. There is neither principle nor justice which would warrant a discrimination."

(24) When it was contended that the remedy by way of restitution might sometimes involve payment of a sum of money equal to that borrowed under a void contract, the learned chief justice gave the following answer at page 721 :

"the grant of such relief is not, however, an enforcement of the contract, but a restoration of the state of affairs as they existed before the formation of the contract. The court, while giving this relief, has not to look at the contract or to give effect to any of the stipulations contained therein. Indeed, the relief is granted not because there is a contract which should be enforced but because the transaction being void does not exist and the parties should revert to the condition in which they were before the transaction."

Broadway, dalip singh and tek chand, jj. , agreed with the chief justice but harrison, j. , appended a strong dissenting note. Quoting section 41 of the specific relief act, the learned judge stated at page 724 :

"in the first place, there is no question of cancellation of an instrument but the assertion of the fact that the contract was void from the start and had no legal existence. In the second place section 41 of the specific relief act appears to me merely to enunciate and give effect to the well - known principle that he who seeks equity must do equity. In this case the infant asks for no equitable relief, but on the contrary he pleads the substantive law and states the self - evident fact that the contract, on which the suit is based, had no existence. Whatever may be the consequences where an infant seeks an equitable relief, i do not think the analogy has been established and i do not think that section 41, specific relief act, throws any light upon or affords any assistance to the decision of the present question."

(25) The full bench of the allahabad high court in ajudhia prasad v. Chandan lal, i. L. R. (1937) all. 860. Considered at length the reasoning in the aforesaid full bench and dissented from it. There, the defendants executed a mortgage deed dated 15th october, 1925 in favour of the plaintiffs. When a suit was filed to enforce the mortgage, the defendants pleaded that they were minors at the time of the mortgage deed. It was found that there was fraudulent concealment of the fact that they were minors at the time of the execution of the mortgage deed. The learned judges, rejected the plea based upon section 65 of the contract act on the ground that the section could be invoked only when the contract. Was between competent parties. They rejected the plea of estoppel on the ground that, when the contract itself was void, the plea of estoppel must fail. When rules of equity were invoked and when the decision of the full bench of the lahore high court was pressed upon them in support of the contention that there could not be any difference on principle between the recovery of the property sold or the money advanced to a minor, sulaiman, c. J. , observed at page 876 as follows :

"where a contract of transfer of property is void, and such property can be traced, the property belengs to the promisor and can be followed. There is every equity in his favour for restoring the property to him. But where the property is not traceable and the only way to grant compensation would be by granting a money decree against the minor, decreeing the claim wculd be almost tantamount to enforcing the minor's pecuniary liability under the contract which is void. The distinction is too obvious to be ignored."

(26) When it was argued, relying upon the same decision, that there could not be any ; distinction for the application of the equitable doctrine, whether the minor was a plaintiff or a defendant, the chief justice remarked at page 877 thus :

"apparently the entire basis of the judgment is that as there is authority for imposing conditions on a minor to refund the consideration when he is suing as plaintiff for the rescission or cancellation of his void contract, there is an equal justification for passing a decree for money against him when he is being sued by his creditor, though he is a defendant. With utmost respect, i would say that such a view would be contrary to the great preponderance of authority both in england and in india and would ignore the well - recognised distinction between the position of a minor when suing as a plaintiff and when he is being sued as a defendant"

(27) The chief justice also approved the view expressed by harrison, j. , in his dissenting judgment and stated at page 878 :

"the learned judge rightly pointed out that section 41 of the specific relief act had no application because in a suit against an infant there is no question of the cancellation of an instrument and when the minor is a plaintiff, there is a well known principle that he who seeks equity must do equity, and therefore, held that no suit of this nature being in its essence contractual, can lead to an order for restitution by the infant on the ground of his having dishonestly induced the plaintiff to contract with him and to pay him money. The view of the learned dissenting judge is in accordance with the opinions expressed in numerous cases. To pass a decree against a minor enforcing his pecuniary liability would, while holding that the contract is void and unenforceable, at the same time be passing a decree agaiast him on the footing that he had entered into the contract and has not carried out its terms. There is no rule of equity, justice and good conscience which entitles a court to enforce a void contract of a minor against him under the cloak of equitable doctrine,"

(28) In the result, the full bench held that no decree could be given to the plaintiff for recovery of the money against the defendant. Both the full benches held that a contract entered into with or by a minor was a nullity and was therefore, not enforceable. The lahore full bench also rejected the plea based on the estoppel embodied in section 115 of the evidence act. Both agreed that, when the quondam minor as plaintiff seeks the aid of a court, the court can insist upon the plaintiff making good his representation on the principle that one who seeks equity must do equity. Both also agreed that the other party as plaintiff can recover the property said by him or otherwise transferred to the minor on the principle that, as the contract was a nullity, the property continued to be that of the plaintiff and, therefore, it could be traced in the hands of the quondam minor. But they differed on the scope and limits of the application of the equitable doctrine. While the lahore full bench would extend it even when the defendant was a minor on the ground that when the contract was a nullity, the parties should be restored to their original position in which case the defendant should restore what ever he received from the plaintiff, whether immoveable, moveable or cash, the allahabad full bench was not able to apply the doctrine in the case of money which could not be traced as, in their view, such direction to restore money would indirectly amount to enforcing the contract of loan entered into with a minor.

(29) We have considered carefully the divergent views expressed in the two full bench decisions. We would prefer the view of the allahabad full bench to that of the lahore full bench. If the view of the lahore full bench be correct it would make nugatory the well - settled principle that a contract with a minor is a nullity, for the lender could, by adopting clever phraseology in the plaint recover back the amount lent by him, which he could not do by enforcing the contract. That apart, the lahore full bench has not borne in mind the distinction between the quondam minor suing as a plaintiff seeking the aid of the court and the other party to the contract suing the quondam minor as defendant for recovering the moneys advanced by him. While in the former case the court, whose aid is sought, can refuse to give the aid unless the plaintiff makes good his representation in the later case he is not seeking the aid of the court but only pleads that the contract, to which he was a party, is a nullity and is, therefore, not enforceable. There is, therefore, an essential distinction between these two categories of cases. Further, a fair reading of sections 39 and 41 of the specific relief act, which are held to be applicable even to a contract with a minor by the madras decisions and which are binding on us, clearly shows that in india, the aforesaid rule of equity has been embodied in a statute and, therefore, courts in india cannot over - step its limits or enlarge its amplitude. In terms, section 39 enables a person to sue for a declaration that a document is, void or voidable and that, in such a suit under section 41, the court can in adjudging the cancellation of an instrument, require the person seeking relief to pay compensation to the other party. These two sections embody the well recognised equitable doctrine that a person who seeks equity must do equity. If the legislature intended to give a similar relief to the defendant also, when he is not seeking to adjudge an instrument void but is resisting the plaintiff's claim for recovery of possession, the legislature would have also made a specific provision to that effect. Presumably, the legislature did not intend to give statutory recognition to a new head of equity. We cannot, therefore, read into that section that, when a document is cancelled at the instance of a plaintiff, a condition can be imposed on the defendant to restore the money to the plaintiff.

(30) Nor can we agree with the learned counsel for the respondent that section 65 of the contract act can be invoked by the respondent. The controversy raised on the applicability of section 65 of the contract act to contracts entered into by minors has been authoritatively and finally set at rest by the judicial committee in mohori bibee v. Dharmodas ghose. , (1902) l. R. 30 i. A. 114 : i. L. R. 30 cal. 539 (p. C.). The judicial committee definitely ruled that sections 64. And 65 of the contract act were applicable only to cases of persons competent to contract. Dealing with section 64 of the contract act, their lordships observed at page 548 :

"the question whether a contract is void or voidable presupposes the existence of a contract within the meaning of the act and cannot arise in the case of an infant. " adverting to an argument raised on the basis of section 65 of the contract act, their lordships proceeded to state : "it is sufficient to say that this section, like section 64, starts from the basis of there being an agreement or contract between competent parties and has no application to a case in which there never was, and never could have been any contract. "

(31) This is a clear and binding authority against the contention that section 65 can be invoked to give relief against a minor guilty of fraudulent misrepresentation of his age. This decision was explained and followed by the full bench of the allahabad high court in ajudhia prasad v. Chandan lal , i. L. R. (1937) all. 860. That section, therefore, applies only to a contract entered into between two persons with legal competency to do so.

(32) The law may be briefly summarised. A contract entered into with a minor is a nullity for want of legal competency. Except as otherwise provided by statute, it is not enforceable and it does not give rise to any rights or liabilities. It is non est. It follows from this legal position that a person who parted with his goods can trace them into the hands of the quondam minor and recover them back in specie, for, he has not lost his title to them. But he cannot seek to recover their price or damages for, if allowed, he would be indirectly asking for the enforcement of the contract and to recover damages for the breach. Nor can a person, who lends money to such a minor, recover it. If allowed to do so, the court would be enforcing a contract of loan. The english decisions graphically describe this position as " restitution stops where repayment begins. " but, there is another principle of equity, namely, that one who seeks equity must do equity. If a quondam minor as plaintiff seeks relief from a court on the basis that the contract was void, the court could refuse that relief unless he has made good his fraudulent representation. If he seeks to recover through court goods which he parted with after receiving the consideration, the court will not help him except by imposing the condition of returning the consideration amount. The principle is embodied in sections 39 and 41 of the specific relief act. Apart from the fact it statutorily recognises a well - settled principle of equity, it is not open to extend the limits of the operation of the provisions by stretching the language or otherwise adding to its contents. When a statute specifically provides for the case of a plaintiff seeking to cancel a document, it is not permissible to invoke other : equitable principles, which would make the provisions nugatory. Further, this will enable the parties to circumvent the prohibition against dealing with minors and, by clever drafting of pleadings, help them to indirectly enforce a contract which is a nullity. Nor can section 65 be invoked as it pre - supposes the existence of a contract between persons with legal competency.

(33) It follows from the aforesaid principles that, in the present case, the plaintiff cannot recover the money advanced by him under the promissory notes. In the result, the decree of the lower appellate court is set aside and the appeal is allowed with costs throughout. Appeal allowed.