Kali Charan Singh v. Hirdai Narain

Fazl Ali, J.:— The suit out of which this appeal arises was instituted on 21st April 1928 by the plaintiff-respondent to have it declared that a kabala executed by his father Babu Sri Narayan in favour of the appellants (defendants first party) on 16th August, 1915 was invalid and to recover possession of the properties transferred by means of that kabala. There was also a claim for mesne profits.

2. It appears that Sri Narayan's father Gopi Lal possessed considerable landed property and had extensive money-lending business at Begusarai, which is a sub-division of Monghyr district. Sri Narayan while still young fell into evil company and began to borrow recklessly and lead an immoral life. He also, while he was yet a minor, instituted a partition suit against his father under the guardianship of one Bihari Lal of Barh his brother-in-law who is said to have been one of the persons who had led him astray and caused the estrangement between him and his father. The suit was ultimately dismissed on compromise, one of the terms of the compromise being that during the lifetime of Gopi Lal, Sri Narayan would not take any loan or transfer any property. This compromise was effected on 21st May 1904 after Sri Narayan had attained majority on or about 29th January, 1904. Two of the transactions with which we are concerned in this appeal took place shortly after he had attained majority and before the compromise was effected. On 24th February, 1904 Sri Narayan executed a simple bond in favour of Bihari Lal for Rs. 3,000 and on 2nd April, 1904 he executed a mortgage bond in favour of the latter for Rs. 10,000 mortgaging thereunder certain joint family properties, notwithstanding the fact that Gopi Lal was alive and was the karta of the joint family. On the death of Gopi Lal there was a partition between Sri Narayan and his three brothers and the property mortgaged in 1904 fell to the share of Sri Narayan. In 1910 Bihari Lal being dead, his son Madan Go-pal instituted two suits for recovery of money due under the aforesaid two bonds against Sri Narayan and the plaintiff who was then a minor. The suits were contested both by Sri Narayan and the plaintiff's guardian-ad-item Babu Anadi Nath Sarkar, a pleader, and written statements were filed on behalf of both the defendants in which many pleas were taken including the plea that Sri Narayan being joint with his father and brothers at the time the bonds in suit were executed, had no right to mortgage any property because his share had not been ascertained till then. The learned Subordinate Judge in whose Court the suits had been instituted decreed them by his judgment, Ex. H-3, which he delivered on 31st January 1912. Against his decision in the two suits two appeals were preferred to the Calcutta High Court and ultimately on 20th May, 1915 a compromise decree was passed in the following terms by the High Court:

“By consent the two appeals are settled on these terms: The appellants shall pay to the-respondent within three months from this date the sum of Rs. 15,000 and Rs. 2,400 for costs in the Court below in full satisfaction of all his claim in both the suits, no costs being payable by either party in this Court. On the failure of the appellants to pay to the respondent the amounts as mentioned above within the time aforesaid the two appeals will stand dismissed with costs.”

3. The plaintiff was a party to the compromise through his guardian ad litem Babu Anadi Nath Sarkar, and the learned Judges of the Calcutta High Court who dealt with the appeal certified that the proposed compromise was for the benefit of the minor concerned: See Ex. H-4. On 16th August 1915, that is to say, a few days before the expiry of the period prescribed by the compromise decree for the payment of the sum of Rupees 17,400 specified therein, Sri Narayan executed the sale deed, Ex. A, which has been impugned in the present suit. By this sale deed which was executed by him as the manager and karta of the joint family consisting of himself and his minor son (the plaintiff) he transferred certain properties to defendants first party for a sum of Rs. 15,500 out of which Rs. 4,000 was to be utilised in paying off a mortgage bond executed by Sri Narayan in favour of one Jainti Kumari and Rs. 11,000 in part payment of the amount specified in the compromise decree of the High Court. It is recited in the deed that although considerable effort had been made on behalf of the executant to arrange for money yet he was unsuccessful and if the sum of Rs. 17,400 would not be paid to the decree-holder within the time allowed by the Court in the compromise decree, Sri Narayan as well as his minor son (the plaintiff) would have to pay a sum of about Rs. 30,694 odd. It appears that on the same day Sri Narayan executed two other sale deeds (Exs. D and L) by which he transferred certain minor properties in order to raise a sufficient amount to pay off the balance of the compromise decree and certain other debts. The plaintiff in his plaint attacked the sale deed, Ex. A, on various grounds. Two of the grounds stated by him were that it had been obtained by fraud and undue influence and that Sri Narayan had not received the entire consideration money, but these were neither pressed in the Court below nor in this Court. The grounds which were pressed in the trial Court and which are material to this appeal are: (1) that there was no legal necessity to justify the sale of the property and that the plaintiff was entitled to avoid it as the major portion of the consideration was, as stated in the deed, to have been paid to Madan Gopal whose bonds were not binding on the plaintiff as the debt contracted thereunder had been contracted for immoral purposes; (2) that the suits instituted by Madan Gopal had not been properly defended by the guardian-ad-liem who had shown gross negligence in not putting forward certain material pleas in defence and had made no attempt to safe guard the interest of the plaintiff either in the trial or in the appellate Court (3) that the defendants first party were fully aware of the immoral life led by Sri Narayan and of the fact that the debt due to Madan Gopal, having been contracted for immoral purposes, the joint family property could not be alienated to pay off such a debt.

4. The defendants traversed almost all the allegations made in the plaint and justified their purchase on the ground that after full enquiry they had been satisfied that the amount which was going to be raised by the sale was necessary for the payment of certain antecedent debt. They also stated that Sri Narayan and the plaintiff had dispossessed the defendants of some lands and a house both of which were covered by the sale deed in question and the defendants had to recover possession of them by means of a suit in which the very allegations which were made by the plaintiffs in the present suit had been made but could not be substantiated.

5. The learned Subordinate Judge framed several issues in the suit of which issues Nos. 2 and 3 as stated in his judgment run as follows:

6. Issue No. 2.—Whether the two bonds of 1904 were executed by Sri Narayan for immoral and illegal debts. Whether the guardian-at-litem of the plaintiff in the Patna suits was guilty of gross negligence in putting the plaintiff's case in Court and whether the plaintiff is entitled to re-open the question in this Court?

7. Issue No. 3.—Whether the alienation of property made by Sri Narayan in 1915 in favour of the defendants is not binding upon the plaintiff.

8. Both these issues were answered in favour of the plaintiff by the learned Subordinate Judge who held (1) that the two bonds of Bihari Lal had been executed by Sri Narayan for money spent in dissipation and debauchery; (2) that the plaintiff's guardian-ad-litem was guilty of gross negligence in not putting the plaintiff's case properly before the trial Court and in not pressing the appeal in the High Court: (3) that the compromise decree not being for the benefit of the minor, he was not bound by it and (4) that the defendants first party were aware of the real state of affairs as found by the learned Subordinate Judge at the time when he took the conveyance from Sri Narayan of the disputed properties. He however found that out of Rs. 15,000 which constituted the total consideration for the sale deed the defendants first party had to pay a sum of Rs. 4,000 to Jainti Kumari in respect of debts which were binding on the plaintiff. On these findings he held that the plaintiff was entitled to have the alienation made by his father to the defendants first party set aside and recover possess on of the property in suit subject to the repayment to the defendant of Rs. 4,000. He also, held that the plaintiff was entitled to recover mesne profits from the date of the deposit of Rs. 4,000 in Court to the date of the recovery of possession of the properties covered by the sale deed.

9. The decision of the learned Subordinate Judge has been vehemently assailed by the defendants first party on whose behalf this appeal has been preferred and after hearing the arguments on behalf of both parties, I have come to the conclusion that the appeal must succeed.

10. It is to be remembered that this is not a suit to set aside the compromise decree passed in the suit instituted by Madan Gopal or for a refund of the amount realised under that decree by him. If such had been the nature of the suit and the parties necessary for the adjudication of such a suit had been before the Court, many of the points which have been raised by the plaintiff would have been more appropriately discussed and decided. The present suit however is to set aside a sale deed which was undoubtedly for valuable consideration and which was executed by one who was admittedly the manager and the karta of the joint family and the father of the plaintiff. It is now well settled that the manager of a joint family has power to alienate for value joint family properties so as to bind the interest of both adult and minor coparceners of the property provided that the alienation is made for a legal necessity or for the benefit of the estate Vide Mulla's Hindu Law, Edn. 7, p. 272. It is also equally well settled that when the manager of a joint Hindu family sells joint family properties the purchaser is bound to enquire into the necessity for the sale and the burden lies on him to prove either that there was a legal necessity in fact or that he made proper and bona fide enquiry as to the existence of such necessity and did all that was reasonable to satisfy himself as to the existence of such necessity. A Hindu father as such has even wider powers of alienating coparcenary property, that is to say, he has powers which no other coparcener has; for he may sell or mortgage ancestral property including the interest of his sons and grandsons therein, provided that the debt was an antecedent debt and was not incurred for immoral or illegal purposes. I take it that one who purchases property from a Hindu father, if he is not in a slightly better position, is at least in no worse position than one who purchases property from the manager of an ordinary joint family and his purchase will also be upheld if it is proved to have been made for legal necessity or for the benefit of the entire family or if it is established that by reasonable enquiry he was satisfied that the sale of the property was justified by legal necessity or was for the benefit of the family. It would of course be otherwise if it is proved that he purchased the property with full knowledge that the purchase money was required to pay off immoral debts. I have already stated that in the present case the disputed properties were sold to the plaintiff only four days before the date fixed in the compromise decree for the payment of the decretal amount. It is evident that if the payment had not been made within the period, the debt for which the estate would have become liable would have increased to Rs. 30,694 from Rs. 17,400 and although no execution proceeding had been taken or was in contemplation at the time when the conveyance in question was obtained by the defendants first party, the matter of the institution of the execution proceedings would have become only a question of time after the expiry of the period prescribed in the compromise decree for the payment of the sum which was payable under the compromise. The compromise was thus apparently for the benefit of the joint family and the two learned Judges of the High Court who recorded it also recorded their opinion that it was for the benefit of the minor. It is also established by evidence that out of the total amount a sum of Rs. 4,000 was paid to Jainti Kumari for a debt, the validity of which is no longer disputed and the remaining Rs. 11,000 was applied in part payment of the decretal amount adjudged to be payable under the compromise decree. In these circumstances I find it difficult to hold that the defendants first party have not discharged the onus which was upon them to prove that they had made proper and bona fide enquiry as to the existence of legal necessity for the sale and had done all that a prudent person would have done to satisfy himself as to the existence of such necessity.

11. The learned Subordinate Judge has come to the conclusion that the defendants first party entered into the transaction of sale with full knowledge of what he describes to be the real state of affairs, that is to say, knowing full well that the compromise decree was in respect of debts which had been contracted for immoral purposes. This conclusion appears to me to be one of the weakest of those arrived at by the learned Subordinate Judge in this case. It is based partly on speculation and partly on a piece of reasoning which appears to me to be somewhat technical and strained. The reasoning in short is that merely because the defendants first party have stated in their pleadings that they had made full enquiries before purchasing the disputed properties and traversed the allegations made in the plaint as to the immorality of Sri Narayan and the manner in which the debts were contracted and how the suit was defended by the guardian-at-litem, it must be assumed that they knew the facts as they have presented themselves or have been found to be by the learned Subordinate Judge, that is to say, they knew that Sri Narayan was an immoral person and that the debts for which the suit had been brought by Madan Gopal had been contracted for immoral purposes. The learned Subordinate Judge however has overlooked the fact that in this country the defendants as a matter of invariable practice traverse every allegation made in the plaint and merely because the appellants have stated in their pleading that they had made enquiries about the facts of the case it does not necessarily follow that they were aware that the specific debts to pay off which the two bonds of 1904 were executed were immoral. The defendants first party are admittedly residents of Mauza Chak Sikandar Saidpur in the district of Monghyr, whereas Sri Narayan used to live mostly at Barh in the district of Patna when the debts are said to have been contracted by him from Behari Lal. We do not know what kind of enquiry was made by them and what facts actually came to their knowledge. There is in fact no satisfactory evidence on the record—and the learned Subordinate Judge also does not refer to any such evidence—that the defendants first party actually knew or had come to know that all those debts for the payment of which the two bonds of 1904 were executed had been contracted for immoral purposes. In these circumstances it appears to me to be unfair to impute knowledge to the appellants merely because they have stated that they had made enquiries about matters connected with the loan and have given their version about them. If the Court wished to proceed upon their admission it should have considered the admission as a whole or rejected it al-together. In my opinion the appellants were bona fide purchasers of the property and had done all that they could to satisfy themselves that the sale of the property which they purchased was justified by legal necessity. In fact the very circumstances in which the property was bought constituted prima facie good grounds for such belief. In 1923 Lah 532(1) it was held that where a decree is in existence against an alienor, the payment of that decree constitutes valid necessity for the alienation of ancestral property. In the present case the bulk of the consideration money paid by the appellants was undoubtedly required for and in fact applied to the payment of a decree which, though based on compromise, carried with it the certificate of the Court that the arrangement arrived at between the parties was for the benefit of the minor. Again part of the consideration money was required for the payment of a debt which has been held to be binding on the plaintiff. Lastly in the judgment of the trial Court in the two suits' brought by Madan Gopal it was definitely stated that it had not been proved that the bonds upon which the suits were based had been executed for immoral purposes. I do not think that with these materials before him an intending purchaser need have instituted any further enquiry to find out whether the proposed sale was justified by legal necessity or not.

12. I shall now briefly deal with the case of the plaintiff that the guardian-ad-litem who represented him in the suits of 1910 did not properly defend those suits.

13. It is now well settled that gross negligence which may be interpreted as culpable neglect of the interest of a minor defendant on the part of his guardian-ad-litem will entitle the minor to the avoidance of proceedings undertaken against him: See 1920 Mad 895(2) : 2 Cal 283(3); 1922 Mad 273(4) : 1926 All 36(5); 1915 Mad 384(6) and 1918 Pat 211(7). It seems however to be equally well settled that it is not every kind of negligence nor any kind of negligence which would render proceedings otherwise regular and proper Table to be opened up: it must be such negligence as leads to the loss of a right which, if the suit had been conducted or resisted with due care, must have been successfully asserted: 6 CLJ 448(8) and 1926 All 36. In the present case the person who acted as the guardian of the plaintiff is not before the Court and we have to investigate the allegations made against him behind his back in a suit instituted more than 15 years after the decision of the previous suit. This is however not such a great difficulty in the way of the plaintiff as the fact that the written statement hled by the guardian in that suit has not been placed on the record and we are invited to condemn the guardian for his alleged omission only upon certain portions of the judgment, Ex. H-3, of the Subordinate Judge wherein the pleadings of the parties have been referred to. How far these pleadings have been faithfully reproduced in that judgment we do not know, but we find that the suit was contested both by Sri Narayan and by the plaintiff and a number of material pleas were raised by both. It is contended in this appeal that three important pleas which ought to have been taken by the guardian were not taken and at least they were not pressed. They are: (1) that the debts for which the two bonds had been executed by Sri Narayan in favour of Bihari Lal had been incurred by him during his minority: (2) that Sri Narayan had no right to mortgage the joint family property during the lifetime of his father who was admittedly the manager and the karta of the family and (3) that the debts in question had been contracted by Sri Narayan for immoral purposes. So far as the first plea is concerned, although it seems to be probable that some of the debts contracted had been contracted during his minority, yet the evidence on that point is not complete even in this suit and it appears to me that the matter cannot be gone into satisfactorily at this distance of time and in the absence of the parties to the original transaction. The accounts books of the firm which advanced the original loans now impugned are not before us and it is impossible to say on what debt and in what circumstances the loans were taken and what amounts were borrowed on each occasion. Moreover, the guardian-ad-litem, if he had been given the opportunity to explain why the plea now suggested was not raised by him, might have offered some explanation as to why the plea was not raised. Even the learned Subordinate Judge deals with this matter as follows:

“It is argued by the plaintiff's pleader that the two bonds of Bihari Lal were also for illegal debts inasmuch as these debts had been contracted by Sri Narain while he was still a minor. While I find indications of this fact in the Patna judgment itself Ex. H-(3) I must uphold the defendant's contention that this case having not been specifically raised in the plaint the defendants were unable to meet it at the trial. The bonds were admittedly executed within two or three months of the attainment of majority by Sri Narain and the defendant's pleader rightly argues that he might have shown if he had notice that some portions of the considerations at least were taken at the time of the execution of the bonds.”

14. As to the second plea it appears from the judgment, Ex. H-3, that one of the pleas taken both by Sri Narayan and the plaintiff's guardian was that as Sri Narain was joint with his father and brothers, he had no right to mortgage any of the properties. The third plea would appear not to have been taken in the suit if one were to go entirely upon the recital of the pleadings in the judgment. There is however an important passage in the judgment of the learned Subordinate Judge to which our attention has been drawn by the learned counsel for the appellants and it runs as follows:

“Of course the boy can question the bonds but it is not proved that the bonds were executed for immoral purposes.”.

15. It appears that Sri Narain and the plaintiff had after the execution of the kabala, Ex. A, dispossessed the appellants of some land and a house covered by it and the appellants had to recover possession of them by a suit instituted by them in the Court of the Munsif at Begusrai. The judgment delivered in that suit is Ex. H and it appears that one of the issues in that case was whether Sri Narain was a man of bad character and whether the kabala which is impugned in the present suit was executed to pay off immoral debts. The learned Munsif who tried the suit recorded the following opinion on this issue:

“The defendants have not been able to prove that the debt contracted by defendant 1 related to any immoral object. The defendants (the plaintiffs?) have on the other hand proved that the kabala was not executed for any immoral purpose. The question whether defendant 1 was a man of bad character or not is therefore of no consequence. It is consequently not necessary to decide this question.”

16. It appears that in that suit the defendants first party were the plaintiffs and Sri Narain as well as Hirday Narayan the present plaintiff and his two minor brothers were the defendants. If that suit had been tried by a Subordinate Judge possessing the same jurisdiction, as the Subordinate Judge against whose decision this appeal is preferred had the decision would, perhaps have been res judicata; but even though the judgment is not res judicata it provides this argument in favour of the appellants that the points on which the plaintiff failed in the Courts which had, to use a familiar expression, the facts of the case nearer to their cen, cannot be very well adjudicated at this distance of time. It may also be stated that the learned counsel for the appellants has taken us there is the entire evidence adduced in this case on behalf of the plaintiff and although most of the witnesses make is general allegations against Sri Narayan's character no attempt has been made to connect the debts incurred by Sri Narayan under the two bonds executed by him in favour of Bihari Lal with his immoral pursuits.

17. The learned Subordinate Judge suggests that in the circumstances of the case it may be surmised that they were incurred for immoral purposes. He may be right, but it appears to me that there is a natural difficulty in deciding the issue in the absence of the original borrower and the lender and when the materials before us are not sufficient to enable us to come to a definite conclusion as to the circumstances under which the specific loans were contracted. There seems to be some evidence that Sri Narayan after he had quarrelled with his father started a cloth shop at Barh and in present state of evidence it is difficult to say how much of the amounts was actually borrowed by him for the purposes of conducting the business, of the shop and how much for his immoral pursuits.

18. It appears to me that the plaintiff has failed to establish that there was-such negligence on the part of the guardian as to amount to gross misconduct, nor in my opinion has it been, shown by the plaintiff that the guardian acted against the best interest of his ward in agreeing to a compromise when the matter went to the High Court. The plaintiff therefore cannot successfully impeach the decree to which he was himself a party.

19. An interesting question was raised before us as to whether the plaintiff, not having admittedly been born at the time when Sri Narayan executed the two bonds in favour of Bihari Lal, could, question them when the suit was instituted by Madan Gopal to enforce those bonds. In 33 All 654(9) it was held that where an alienation of ancestral property is invalid as having been made without legal necessity by one member of the coparcenary without the consent of the rest, it is open to a coparcener to object to such alienation notwithstanding that he was born subsequent thereto. The learned Judges who decided the case quoted a passage from Mayne's Hindu Law which runs as follows:

“A son cannot object to alienation validly made by his father before he was born or begotten, because he could only by birth obtain an interest in the property which was then existing in his ancestor…. On the other hand if the alienation was made by a father without necessity and without the consent of the sons then living, it would not only be invalid against them, but also against any son born before they had ratified the transaction and no consents given by them after his birth would render it binding upon him.”

20. In this case it is said that though the plaintiff was not born at the time when the two bonds were executed by. Sri Narayan he had, at least so far as the mortgage bond was concerned, acquired an interest on his birth in the equity of redemption and therefore was entitled to impugn the mortgage. In the passage quoted from Mayne's Hindu Law, reference is made to a hypothetical case where one or more sons being in existence, an alienation is made by a Hindu father with out legal necessity and without the consent of the sons then living and it is a question of some nicety whether such an alienation could be questioned on the ground of immorality by a son born afterwards, if no son or sons were living at the time of the alienation. However that may be the question is somewhat academic one and need not be decided in this appeal.

21. I would allow the appeal, set aside the judgment and decree of the Court below, and dismiss the plaintiff's suit with costs throughout.

22. James, J.:— I agree.

23. Appeal allowed.