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1914 DIGILAW 226 (MAD)

Ramasubba Aiyar v. Avudai Ammal

1914-07-14

S.AIYAR, TYABJI

body1914
JUDGMENT Sadasiva Aiyar, J. 1. The learned District Judge in arriving at his conclusions has practically set aside the oral evidence on both sides as of very little value. He has considered the documentary evidence at great length and has then come to the conclusion that the documents do not prove the plaintiffs case, that case being that the 2nd defendants purchase under Exhibit B was made as the 1st defendants benamidar. In arriving at this conclusion, the learned District Judge has laid (in our opinion) undue stress in very many places on the fact that the burden of proof lay on the plaintiffs. We think that when the whole evidence on both sides has been let in it is not legally sound to lay stress on the burden of proof, and that the Court should weigh the evidence let in and the probabilities as a whole and then arrive at its findings on the facts. Further, as pointed out in Hall v. Venkatakrishna 13 M. 394 at p. 399 the burden of proof in most cases is not a burden that goes on for ever resting on the shoulders of the person upon whom it is first cast." These considerations (it seems to us) have not been properly kept in mind by the learned Judge of the Court below in construing the documentary evidence on the construction of which the case of benami rests. After reading over the principal letters, in Exhibit E series, and hearing many of them discussed at the Bar, we are of opinion that Exhibits E14 and E16 have not been properly construed by the learned District Judge, and that, on a proper construction of these letters, the finding ought to have been that the 2nd defendant was the 1st defendants benamidar in the matter of the purchase of lands from Padmanabha Aiyar. 2. The question of construction of documents is a question of law--Lala Fateh Chand v. Rani Kishen Kunwar 16 Ind. Cas. 2. The question of construction of documents is a question of law--Lala Fateh Chand v. Rani Kishen Kunwar 16 Ind. Cas. 67 : 16 C.W.N. 1033 : 23 M.L.J. 330 : 12 M.L.T. 413 : 10 A.L.J. 335 : 14 Bom.L.R. 1090 : 34 A. 579 (P.C.) : 17 C.L.T. 1 : (1912) M.W.N. 1065, and as the finding of fact in this case in the lower Court has been based (as we have already stated) on the documentary evidence alone, we set aside the finding of the District Judge in the 2nd defendants favour and decide the 2nd issue in the plaintiffs favour. 3. Before disposing finally of this second appeal we think it is desirable to obtain a finding from the District Court on the 7th issue, which has not been dealt with in the lower Appellate Courts judgment. The finding should be submitted within four weeks from the receipt of this order. Ten days will be allowed for filing objections. Tyabji, J. 4. I agree. 5. In compliance with the order contained in the above judgment, the District Judge of Tinnevelly submitted the following FINDING 1. A finding has been called for on issue No. 7, whether plaintiffs are not entitled to the whole or their share of the plaint properties and are precluded from maintaining this action on account of 1st defendants conduct, as alleged in paragraphs 5 and 6 of 2nd defendants written statement. Assuming that the benami transactions in question were entered into in order to defraud 1st defendants creditors, the rule of law applicable is very clearly laid down by authority. It is this, that 2nd defendant--in order to retain the suit property--must allege and prove that the contemplated fraud was successfully carried into effect. This is the position taken up by the Privy Council in Petherpermal Chetty v. Muniandy Servai 35 C. 551 (P.C.) : 35 I.A. 98 : 12 C.W.N. 562 : 7 C.L.J. 528 : 10 Bom.L.R. 590 : 5 A.L.J. 290 : 18 M.L.J. 277 : 4 M.L.T. 12 : 14 Bur.L.R. 108 : 4 L.B.R. 266 and by the High Court of Madras in Munisimi Mudaliar v. Subbarayar 31 M. 97 : 18 M.L.T. 151 : 3 M.L.T. 246. The first question, then, that arises is whether the present is a case to which the rule above stated is applicable. The first question, then, that arises is whether the present is a case to which the rule above stated is applicable. The second is whether--it being such a case--the contemplated fraud was effected. The third and last whether--if the fraud was effected and 1st defendant is unable to recover his share--2nd defendant is entitled to retain at any rate their shares as against plaintiffs. 2. The finding of the District Munsif on these points--as I understand it--is as follows: (a) that an acquisition of property benami in order to defraud creditors is not on the same footing as an alienation made with the same purpose; (b) that there is not, in fact, sufficient evidence to show that any creditor was actually defrauded; (c) that, consequently, even 1st defendant could have maintained the action; (d) that in any event, plaintiffs could maintain it in order to recover their own shares in the suit property. 3. On the first point, I am. unable to agree with the District Munsif that there is any reality in the very clear-cut distinction he draws between benami acquisitions and benami alienations, so long as the object of both is to secrete a debtors property from his creditors. Each case must, I imagine, be judged on its merits; and it would obviously make a vast difference in the circumstances we are now considering, if it were alleged and proved that the attachment and purchase of the suit property by Padmanabha Iyer were part of the contemplated fraud. There appears to be authority both for and against the District Munsifs view. A case of such an acquisition is referred to in Jadu Nath Poddar v. Rup Lal Poddar 33 C. 967 at p. 973 : 10 C.W.N. 650 : 4 C.L.J.22 Konjee Singh v. Jankee Singh (1852) Bang. S.D.A. 838. In that case, the majority of the Court decided against the plaintiff, who sued to recover property bought by him in the defendants name with a view to secure it from his creditors. The minority rested is decision on, inter alia, the ground that, if the plaintiff succeeded, the creditors would be benefited. S.D.A. 838. In that case, the majority of the Court decided against the plaintiff, who sued to recover property bought by him in the defendants name with a view to secure it from his creditors. The minority rested is decision on, inter alia, the ground that, if the plaintiff succeeded, the creditors would be benefited. All the circumstances of the case are not to be found in the quotation in Jadu Nath Poddar v. Rup Lal Poddar 33 C. 967 at p. 973 : 10 C.W.N. 650 : 4 C.L.J. 22, but it seems to me that if the minority was right, it was certainly not on the ground stated. In this, as in every similar case, it is difficult to see how creditors, who have been induced to let their claims lapse, could get any benefit from either party. And if their claims were still alive, they could, I imagine, pursue the property equally in the hands of the owner and of the benamidar. For, when once the purchase has been found to have been benami and in fraud of them, it is invalid against their claims unless the property has, in the interval, passed into the possession of a bona fide purchaser for value. A case to the contrary effect is cited by Mayne in paragraph 447 of his Hindu Law, 7th Edition Suboodra v. Bikramadit S.D. of 1858. There a man made a purchase in another persons name with the object of preventing the property from being seized by his creditors. The Court held that he could enforce his rights against the benamidar, opining that he was merely suing "to have a legal right enforced, an act legal in itself though...done with a motive of keeping the property out of the reach of his creditors." The whole circumstances of the case are not given, but they seem to me on the face of them to be not very different from those now in question. When the present suit properties were attached, brought to sale and purchased by a creditor, they passed once and for all out of the reach of the other creditors. When the present suit properties were attached, brought to sale and purchased by a creditor, they passed once and for all out of the reach of the other creditors. The latter were in no way prejudiced (they might conceivably even have been benefited) by the re-acquisition and it is impossible to see how it was illegal for 1st defendant to re-acquire the property, even if he did so benami in order to screen it from them. The case, as I have already indicated, would be very different if the attachment and purchase by Padmanabha Iyer had been part of the whole scheme of fraud, bat this, is neither alleged nor proved. 4. I would, therefore, hold that this is not a case to which the rule laid down in Petherpermal Chetty v. Muniandy Sarvai 35 C. 551 (P.C.) : 35 I.A. 98 : 12 C.W.N. 562 : 7 C.L.J. 528 : 10 Bom.L.R. 590 : 5 A.L.J. 290 : 18 M.L.J. 277 : 4 M.L.T. 12 : 14 Bur.L.R. 108 : 4 L.B.R. 266 is applicable and that there is nothing to prevent 1st defendant and a fortiori plaintiffs from recovering the suit properties from 2nd defendant. On this finding, it is not strictly necessary to proceed any further, but as the other points have been raised, I will briefly consider them. Before doing so, I must indicate one other ground on which, I imagine, 2nd defendant must fail. Mayne in paragraph 446 cites an English case, Haigh v. Kaye (1872) 7 Ch. App. 469 : 41 L.J. Ch. 537 : 26 L.T. 673 : 20 W.R. 597, which lays down a further rule that "in order to enable the grantee to retain the property, he must expressly set up the illegality of the object and admit that he is holding for a different-purpose from that for which he took the property." This, of course, is what 2nd defendant has never done. Throughout a protracted litigation, of which the present suit is only a part, he has steadily maintained in various Courts that the transactions were bona fide, with his own funds and on his own account. And it was only in the alternative that he fell back on the plea that plaintiffs, on their own showing, were disentitled to succeed. Throughout a protracted litigation, of which the present suit is only a part, he has steadily maintained in various Courts that the transactions were bona fide, with his own funds and on his own account. And it was only in the alternative that he fell back on the plea that plaintiffs, on their own showing, were disentitled to succeed. Neither explicitly nor by implication has he ever admitted the real purpose of his holding or set up its illegality and he can hardly, I think, be allowed to put them forward merely as an argument in the last resort. 5. On the next point, there is, of course, no room for doubt as to the object of the transaction. It is plainly to be seen from paragraph 14 in the plaint and from the letters, Exhibit E series, that passed between the parties. Exhibit E14, which is dated after Padmanaba Iyers sale, closes with the significant remark, hereafter there can (not) be the least fear about the (suit) properties." As to the success with which the fraud was carried out, the evidence is more than ordinarily lacking in precision. On one side is that of 27th defendants witness and on the other that of 1st defendant. The latter merely succeeds in conveying the impression that no creditor was paid more than a part of his dues, and most of them nothing at all, but it is all exasperatingly lacking in details as to dates and figures. And, as plaintiffs Pleader points out, we are only concerned with creditors who may have given up their claims after October 1900. 6. Twenty-seventh defendants witness speaks about litigation referred to in Exhibit E7, which apparently ended in a decree against 1st defendant and others in December 1899. It was about a chit conducted by 1st defendant and his brother. The chit broke down and 27th defendants witness and other subscribers who had not drawn prizes sued the prize-winners and the stake-holders and got a decree. Of the amount decreed, it is perfectly clear from 27th defendants witness evidence and 1st defendants admissions that the plaintiffs recovered no more than a percentage and that solely from the prize-winners. The chit broke down and 27th defendants witness and other subscribers who had not drawn prizes sued the prize-winners and the stake-holders and got a decree. Of the amount decreed, it is perfectly clear from 27th defendants witness evidence and 1st defendants admissions that the plaintiffs recovered no more than a percentage and that solely from the prize-winners. There is not the slightest reason to suppose that they got anything whatever out of 1st defendant and his brother and there is every reason to suppose that, if they had known the nature of the suit transactions, they would have proceeded against the properties acquired in 2nd defendants name. Twenty-seventh defendants witness says in this connection: "I never took any steps to recover the balance, I did not because I thought it was hopeless to recover anything from Ayyavier and Vythilingam Iyer. I thought so because several of the creditors came to grief and could not recover the amounts due to them. I made no special inquiries as to whether they had any property because it was believed by myself and other creditors that they were worth nothing.... I met Ayyavier in Andu 1078 (1903). He explained to me with tears in his eyes that he had parted with all his properties and could not, therefore, pay me my debts.... I believe that my claim against Ayyavier was not barred." On this the District Munsif comes to the conclusion that the decree was not alive on the date of the conversation referred to. If it was not, Ayyaviers representation was altogether superfluous and inexplicable. Under the circumstances, I see no reason why 27th defendants witness should not be believed when he says that, as far as he knew, his claim was then alive. If it was, it is obvious that he was induced not to press it by the representation, which he believed, that the debtors had no property he could proceed against. The suggestion that his claim was met by the sale of a house to him is obviously futile, as the sale was several years before the litigation about the chit. First defendants evidence as 10th plaintiffs witness it is impossible to read with any degree of patience and without a strong prejudice. His very evident object throughout has been to protect his property by a systematic course of fraud. First defendants evidence as 10th plaintiffs witness it is impossible to read with any degree of patience and without a strong prejudice. His very evident object throughout has been to protect his property by a systematic course of fraud. He first overloaded it with a number of fictitious encumbrances in order to deter creditors by the prospect of endless litigation from proceeding against it. And when a creditor did attach and buy it, he re-purchased it in anothers name. The impression that his evidence leaves on my mind is that he paid no one anything if he could help it. He professes to have satisfied all his creditors but two or three within six months of his release from Jail, but has no acquittances or accounts and cannot say how much he paid, to whom, on what dates and from what source. In the absence of all this detail, it is obviously impossible to say which of his creditors, except perhaps 27th defendants witness and. another, gave up their claims subsequent to October 1900. It is quite clear from his evidence that he never paid 27th defendants witness a penny. In the case of one Ponnu Ammal he admits a debt of Its. 4,600 on a pro-note, which he says was compounded eventually for Rs. 2,000 some years after the benami acquisitions. The inference is, I think; justifiable that Ponnammal would not have given up so much had she known that 1st defendant still had some property. I need refer to only one other debt and that is the decree debt in Original Suit No. 86 of 1072. It was owing by 1st defendant and his brother to one Sangu Iyer. At about exactly the same time as the benami sale to 2nd defendant, his brothers took an assignment of this decree. They were, I may remark, on extremely bad terms with him and their sole object appears have been to expose the dishonest deal-is between him and 1st defendant and Section brother. In pursuance of this object, hey got the decree transferred to Tinne-\relly for execution and attached the properties comprised in Exhibit B. Second defendant put in a claim petition, which was allowed. Thereupon his brothers filed a suit against him and 1st defendant and his brother, which he alone defended. In pursuance of this object, hey got the decree transferred to Tinne-\relly for execution and attached the properties comprised in Exhibit B. Second defendant put in a claim petition, which was allowed. Thereupon his brothers filed a suit against him and 1st defendant and his brother, which he alone defended. The suit was dismissed in the Court of first instance, bat the District Court reversed its decision and found 2nd defendants purchase to have been benami for 1st dafendant and his brother. There was a second appeal to the High Court which was dismissed. Ultimately it would appear from Exhibits U & U1 that 1st defendant and his brothers themselves satisfied the decree. On the lines laid down in Muthuraman Chetty v. Krishna Pillai 29 M. 72 : 15 M.L.J. 478 there would seem in this instance to have been part performance of a substantial character" of the fraudulent agreement. The Privy Council, however, in Petherpermal Chetty v. Muniandy Servai 35 C. 551 (P.C.) : 35 I.A. 98 : 12 C.W.N. 562 : 7 C.L.J. 528 : 10 Bom.L.R. 590 : 5 A.L.J. 290 : 18 M.L.J. 277 : 4 M.L.T. 12 : 14 Bur.L.R. 108 : 4 L.B.R. 266 took a different view of a somewhat analogous litigation. They held it to be sufficient that the creditor had been successful and had been paid his debt together with the costs of the litigation, adding that "if his interests were prejudiced at all, it was only to the extent that he was obliged to take proceedings which, had the deed never been executed, he might possibly never have been obliged to take." This view I am bound to follow, but I do so with some reluctance. No doubt, 2nd defendants brothers took the assignment with their eyes open, but it is difficult to see how ultimate payment plus taxed costs can be held to be a sufficient compensation for several years of litigation and delay forced on them by a benami purchase. 7. On the second point, then, I find that two creditors, at least, were defeated and that, therefore, the contemplated fraud was effected. On this finding, 2nd defendant can, of course, retain the property as against 61st defendant. The last question is whether he can retain, at any rate, their shares as against plaintiffs. On this point I can find, and have been shown, no authority. On this finding, 2nd defendant can, of course, retain the property as against 61st defendant. The last question is whether he can retain, at any rate, their shares as against plaintiffs. On this point I can find, and have been shown, no authority. A case is re-ported in Rangammal v. Venkatachctri 20 M. 323 : 6 M.L.J. 64, but being concerned with a widow, it is hardly parallel to the present suit which is by coparceners. It is argued that the decision in that case turned on the benefit presumed to have been derived by the widow from her hus-. bands fraud and that similarly, in this case, plaintiffs should be non-suited as having profited by their fathers dishonesty. There are,, no doubt, sentences in the judgment which are capable of such a construction, but it is perfectly clear that the Court of 1st instance non-suited the then plaintiff on the ground that she stood in the shoes of her deceased husband who could not, if alive, have succeeded on the rule of equal delinquency. It seems to me obvious that in cases of this nature the question of benefit -or profit is quite irrelevant. A fraudulent confederate can retain the property of his partner in guilt on one ground only, and that is by proof that the person who sues him is "in pari delicto." As between confederates who have combined to cheat others, the law will not interfere to evict the one in possession. And even if such a question be material it is not easy to see how the widow in the previous, or plaintiffs in this case, can properly be said to have profited or benefited by the fraud. To my mind it is clear that the only person who benefited prior to the litigation was the dishonest confederate. It may he that some creditors have relinquished part of their claims, but how, it may well be asked, are plaintiffs or 1st defendant now any better off on that account than if their creditors had attached and sold their property and thereby satisfied their claims? They would then have lost their property and, so far, they have lost it now, as effectively as if it had been attached and sold in satisfaction of the decrees against them. 8. They would then have lost their property and, so far, they have lost it now, as effectively as if it had been attached and sold in satisfaction of the decrees against them. 8. It is, of course, the case that plaintiffs, if successful, will take back their shares of the joint property relieved by their fathers fraud of the burden of paying their fathers debts, which they were indubitably liable to pay. But is this, again, a material consideration? I think, not at any rate as between them and 2nd defendant. Ha is allowed, as Mayne puts it, to cheat their fathers because he and they jointly succeeded, in cheating others. As against co-parceners who were minors and are not asserted to have had any knowledge of or part in the fraud, I am quite unable to see how his plea of " inpari delicto" can be entertained. He has no rights in the matter at all, bat is allowed, solely on grounds of public policy, to retain his fraudulently acquired property against his equally fraudulent confederate. Plaintiffs are obviously in a very different position from 1st defendant and there is no apparent ground in reason or in law why 2nd defendant should be permitted to cheat them, they not having been confederate with him in his successful fraud. A doubt of this kind was suggested (vide page 593 of Maynes 7th E lition) by Lord "Eldon, who questioned whether the rule would be enforced in the case of persons claiming under the settlor, but themselves not parties to the fraud. On page 388 of the 18 Madras ruling, Rangammal v. Venkatachari 18 M. 378 at p. 386 on the other hand, it is laid down distinctly that no such relaxation can be allowed. But that case may be distinguished on the ground that it was there sought to set aside a collusive decree. The 20 Madras decision may also be distinguished if it need be distinguished at all--on the ground that it dealt with a widow and not with co-parceners, who can hardly be said to stand in any ones shoes as regards their own shares in the joint property. 9. I must, therefore, find that the rule is not applicable to plaintiffs. They are co-parceners innocent of the fraud and 2nd defendant cannot be allowed to retain their shares of the joint property. 9. I must, therefore, find that the rule is not applicable to plaintiffs. They are co-parceners innocent of the fraud and 2nd defendant cannot be allowed to retain their shares of the joint property. To sum up, I hold I. That the rule is not applicable to the facts of this case at all. II. That 2nd defendant must, in any case, fail as he has never admitted the fraud. III. That, if the rule be held applicable, there has been a successful fraud. IV. That, however, plaintiffs can m, tain a suit to recover at any their shares. This second appeal coming on again final hearing after the return of the finding c the lower Appellate Court upon the issued referred by this Court for trial, on Friday the 1st day of May 1914, and having stood over for consideration till this day, the Court delivered the following JUDGMENT Sadasiva Aiyar, J. 6. The 1st plaintiff died issueless pending the litigation and the 2nd plaintiff is the sole plaintiff on record now. The suit was brought (1) for a declaration that the sale-deeds B and C executed in favour of the 2nd defendant nominally were really intended for the benefit of the 1st defendant who is the plaintiffs undivided father, and for the possession of the properties purchased under those deeds, (except a house in the 1st defendants and in the plaintiffs possession) ejecting the 2nd defendant therefrom: (2) (in the alternative) for the partition of the properties and for the possession of the plaintiffs share therein, leaving the 2nd defendant to enjoy the 1st defendants share if the Court was inclined to take the view that the plaintiff cannot recover the 1st defendants share also. 7. By the judgment, dated 14th July 1913, pronounced by us at the* former hearing in this case and by the findings submitted at our instance by the District Court (which findings, so far as they are findings of fact, we accept), the following facts are established: (a) the plaint properties were purchased with funds which came into the hands of the 1st defendant (the plaintiffs father) as the head of his undivided family, but the sale-deeds were taken in the name of the 1st defendants legal adviser (the 2nd defendant) in order to defraud, defeat and delay the numerous creditors of the 1st defendant. (b) Two at least of these numerous creditors were defeated and defrauded of their claims owing to the properties having been purchased in the 2nd defendants name and the consequent concealment of the 1st defendants title from his creditors. 8. The plaintiff (appellant) contends on these facts that he is entitled to the possession of all the plaint properties on behalf of his family (consisting of himself and the 1st defendant). The 2nd defendants widow (and legal representative) contends on the other side that the plaintiffs suit ought to be wholly dismissed as the 1st defendant has defrauded his creditors by purchasing the properties in the 2nd defendants name and the Court ought not to assist the 1st defendants undivided son (the plaintiff) to recover the property from the benamidar and should allow the possession of the properties to continue to remain where it has fallen. In the alternative, the 2nd defendants widow contends that the 1st defendants share, at least, should remain with her as the 1st defendant cannot be allowed to recover back his share through the plaintiffs instrumentality. 9. In the alternative, the 2nd defendants widow contends that the 1st defendants share, at least, should remain with her as the 1st defendant cannot be allowed to recover back his share through the plaintiffs instrumentality. 9. The plaintiff (appellant) urges in reply: (a) that the principle of law disabling a fraudulent debtor who has succeeded in his fraud from recovering (as plaintiff) properties nominally alienated by him to the defendant, does not apply to a case where the successful fraud consisted, not in alienating the plaintiffs properties nominally to the defendant, but in purchasing the properties fraudulently in the defendants name and putting the defendant in possession of those properties to conceal the real title from creditors; (b) that, as the plaintiff is not suing to recover 1st defendants share of the properties on behalf of the 1st defendant but on behalf of the undivided family consisting of the plaintiff and the 1st defendant, the plaintiff ought to be given a decree for the possession of the whole; (c) that the principle of law by which the 1st defendant is precluded from recovering his share and by which the 2nd defendant is allowed to retain what does not really belong to him but to the 1st defendant, becomes inapplicable where the 1st defendant belongs to an undivided Hindu family and the plaintiff as a member of the undivided family sues on behalf of the family, in other words, that the rule of law by which a person, not really the owner, is allowed to retain what is not his can and ought to be restricted and got over, if possible, by the application of other legal principles; (d) that as the 2nd defendant did not clearly admit in his written statement his participation in the fraud committed by the 1st defendant against the 1st defendants creditors, he (2nd defendant) and his legal representative cannot be allowed to invoke the benefit of the rule, In pari delicto etc; (e) that even if the 1st defendant is not entitled to get back the properties from the 2nd defendant by reason of a maxim of public policy, no greater effect should be given to that fact in the 2nd defendants favour than if the 1st defendant had made a gift of the properties to the 2nd defendant and such a gift could be wholly set aside by the undivided son of the 1st defendant; and lastly (f) that even if as much effect be given to the rule as would follow from a conveyance for valuable consideration to the 2nd defendant by the 1st defendant, the 2nd defendant should be relegated to a general suit for partition of the properties of the plaintiff and of the 1st defendant to enforce the equities which a purchaser for valuable consideration from a Hindu coparcener can invoke and should not be allowed to retain the 1st defendants share and to have a partition effected in the present suit itself. 10. After giving my best consideration to the arguments on both sides, I have come to th(c) following conclusions: I do not think that the distinction sought to be made between the fraud which consists in a dishonest debtor alienating his properties nominally to the defendant and the fraud by which he purchases properties in the name of the defendant can be supported on principle. Mr. Govindaraghava Aiyar and the learned District Judge (Mr. Waller) rely on the case of Subhodra v. Bikramadit S.D. of 1858 for thei contrary position. With great respect, I am unable to see the distinction sought to be made in that case. I find great difficulty in holding that while a debtor who alienates his property nominally to the defendant and puts the property in the defendants possession and succeeds thereby in cheating his creditors is admitedly guilty of legal fraud, the same debtor if he purchases properties in the name of the defendant and puts the purchased property in the defendants possession and succeeds thereby in cheating his creditors is guilty only of moral fraud and can escape the penalty of the rule, In pari delicto etc. 11. If a person who is a member of a joint Hindu family can indirectly recover his share of the family properties which he has successfully concealed from his cheated creditors by setting up another member of the family to recover the formers share also, the above maxim based on public policy will practically cease to exist in such cases and I am not prepared to so destroy that wholesome maxim in favour of fraudulent debtors, simply because what I may call the rights by which sons acquire interest by mere birth and by which the interests of a co-parcener pass on his death by survivorship to his co-parceners obtain by custom (recognised by commentators) in the Mitakshara system followed in these parts, these customary laws being inconsistent with the progress of the community and with the rule of the more ancient and authoritative Shastras. Nor am I inclined to allow the above wholesome rule of public policy to be nullified by the equally artificial rules relating to the distinctions between alienations by way of gift and alienations for consideration. The rule of public policy is not based on the assumption (by a sort of legal fiction) of a real transfer of title in the defendants favour. The rule of public policy is not based on the assumption (by a sort of legal fiction) of a real transfer of title in the defendants favour. The introduction of the idea of a real alienation and the further introduction of the refined distinction between the effect of a transfer by way of gift and a transfer for valuable consideration (though such a distinction seems to be established by most of the Madras decisions) merely confuses the issue as to whether the rule of public policy should be given effect to in all cases falling within its principle or should be allowed to be successfully evaded. 12. As regards the rule laid down in the English case of Haigh v. Kaye (1872) 7 Ch. App. 469 : 41 L.J. Ch. 537 : 26 L.T. 673 : 20 W.R. 597 (a rule relied on by the learned District Judge and by Mr. Govindaraghava Aiyar), that in order to enable the defendant "to retain the property, he must expressly set up the illegality of the object" with which the title and possession of the properties were falsely made to appear to be vested in him, in other words, that the defendant should clea admit and plead his "scoundrelism" (the strong word is taken by me from the judgment in the English case) in order to succeed in hi plea, I think that where the pleadings in Indian Courts raise an issue with reasonable clearness, the fact that the party does not* put the plea forward in a particular form is immaterial. The 2nd defendants contentions in paragraphs 5 and 6 of his written statement were evidently treated by the Munsif and by the legal practitioners who appeared on both sides before the District Munsif as raising the question whether if the 1st defendant had successfully cheated his creditors by the purchase in the 2nd defendants name, the plaintiff could be allowed to recover the properties or his share therein. For the learned District Munsif in paragraph 88 of his judgment deals elaborately with this question and considers the decisions cited on either side on that question, which question (the learned District Munsif says) was. "seriously pressed" before him (by the 2nd defendant). 13. For the learned District Munsif in paragraph 88 of his judgment deals elaborately with this question and considers the decisions cited on either side on that question, which question (the learned District Munsif says) was. "seriously pressed" before him (by the 2nd defendant). 13. The 2nd defendants contention that the plaintiff is not entitled to recover even his share cannot be sustained as the plaintiff does not claim his share under his father (the 1st defendant) and the decision in Yaramati Krislmayya v. Chundru Papayya 20 M. 326 which prevents not only the fraudulent debtor but also his heir from recovering possession is not, therefore, applicable. 14. In the result, the decrees of the lower Courts will be discharged and instead there will be a decree for the plaintiff for partition of the plaint properties (except the house admittedly in the plaintiffs and the 1st defendants possession) and for recovery of the plaintiffs half share therein. The usual commission for partition will be issued by the Court of first instance and final decree will be passed. The parties will bear their respective costs throughout. Tyabji, J. 15. My learned brother has stated the facts and the reasons for the conclusion at which he arrived, and I agree. 16. The principle referred to in Haigh v. Kaye (1872) 7 Ch. App. 469 : 41 L.J. Ch. 537 : 26 L.T. 673 : 20 W.R. 597, for the purpose of applying it in India, cannot, it seems to me, be so interpreted as to imply that in this one matter there is some magic special words of pleading. The question that in each case be whether the Court the other parties understand what is sought by the party pleading to be submitted for adjudication; if it is the scoundrelism" of the party that is sought to be adjudicated upon, and if the defendant makes it clear that his "scoundrelism" is the subject-matter of the issue that has to be tried, I am unable to see On what principle the Court can refuse to adjudicate upon it, notwithstanding that the defendants case has been indicated with sufficient clearness to all parties concerned. Nor am I able to see why the introduction in the pleading of that or any other specified expression should have the effect of changing the rights of the parties. Nor am I able to see why the introduction in the pleading of that or any other specified expression should have the effect of changing the rights of the parties. I do not by any means imply that the Court should by permitting a strained construction of the pleadings assist a party to set up his own fraud, or that euphemism when it has the effect of misleading either the Court or any party concerned, or has the effect of obscuring the issue, should be tolerated in such matter. 17. It, therefore, seems to me that the effect upon the rights of the parties, of the fraud referred to in the fifth and sixth paragraphs of the 2nd defendants written statement, must be considered by us. 18. For this purpose, and in reference to the facts of the present case, I am entirely with my learned brother in being unable to see any ground for distinction between a fraudulent alienation and what has been called before us a fraudulent acquisition: the fraud in each case consists of a dishonest mode of dealing with property. The subject of such dishonest dealing consists in the one case of the property which is purported to be alienated, in the other of the consideration which is transmuted into the property that is acquired in the name of a third party. The dealing is a dishonest act because it has the effect of deceiving creditors into thinking that their debtor has no right over effects out of which the creditors desire to have their claims satisfied--whereas in truth the debtor continues to be the real owner of the effects in question, and they ought to be available for his creditors. The deception is effective, because in the case of a fraudulent alienation the property purported to be alienated is nominally re-placed by consideration of a kind which is incapable of being traced by the creditors, and in the case of a fraudulent acquisition, the consideration is transformed into the shape of the property acquired so as to permit of its being kept in the possession of a third party who is its ostensible purchaser and owner. Where the question is, therefore, whether a disposition of property vitiated for such reasons ought to be considered -legally operative, can it make any difference that the medium through which the fraud is effected consists of money or of property of some other kind, moveable or immoveable? The fraud inheres not in the subject of the fraud, nor in the ostensible act, but in what is really done: in delaying or defeating creditors. The ostensible act itself is of the same nature in its essence and in regard to its legal effect,--though its features may be such as to make alienation" the more apt expression for referring to it in some cases, and "acquisition" in others; for the act consists of an ostensible parting with the ownership of property for some pretended consideration, whereas in truth the consideration is non-existent and the property is not intended to be subjected to any change of ownership. 19. I agree, therefore, in the order proposed by my learned brother.