Jagat Singh Bist Chaudhri v. Behari Lal and Premlal Sah
1941-09-16
BAJPAI, COLLISTER
body1941
DigiLaw.ai
JUDGMENT Collister and Bajpai, JJ. - These two appeals arise out of the same judgment and can be disposed of together. 2. Appeal No., 498 is an appeal by Jagat Singh Bisht, who was Defendant No. 3 to the suit. Appeal No. 362 is an appeal by Gosain Singh Nain Mal, who was Defendant No. 4. The Plaintiff whose name is Behari Lal was the Government Treasurer at Almora, and his case as set out in the plaint may be summarisad thus: 3. On the 17th February 1928 Prem Lal Sah who is Defendant No. 1 executed a security bond as tahvildar or cashier of the Treasury "in the penal sum of Rs. 10,000," the property secured being a housa in the Khazanchi Mohalla and a house in the Karkhana Bazar. He also did the banking business of a firm of which the Plaintiff is a joint proprietor. Defen dant No. 1 embezzled Rs. 80,003 from the Treasury and Rs. 3,125 from the money belonging to the Plaintiff's firm. Thereafter Defendant No. 1 was tried under S. 409 I.P.C. and he was convicted of the charge and was sentenced to imprisonment for three years and to pay fines aggregating to Rs. 2,000. The Plaintiff was directed to pay Rs. 30,000 to Government, out of which he has paid Rs. 15,000, and he is liable to pay the balance of Rs. 15.000 in annual instalments of Rs. 5,000. Defendant No. 3, having full knowledge of the above facts, purchased half the Karkhana Bazar house when it was sold at auction in 1932 in proceedings under S. 386 (1) (b) of the Criminal Procedure Code and purchased the other half of the aforesaid house under a sale-deed executed on the 5th October 1932 by Ratan Lal, who is Defendant No. 2 and who is a son of Defendant No. 1. 4. It was further alleged in the plaint that the firm known as Prem Lal Ratan Lal, of which Defendant No. 1 was-according to the Plaintiff the sole proprietor, had obtained a decree against a certain person for Rs.. 0,047 6 and that on the 16th February 1933 Defendant No 4 who is the Appellant in appeal No. 3b2 of 1934, knowing all the facts stated above, wrongfully purchased the balance of this decree a portion of which had been attached by other creditors from Defendant No. 2. 5.
0,047 6 and that on the 16th February 1933 Defendant No 4 who is the Appellant in appeal No. 3b2 of 1934, knowing all the facts stated above, wrongfully purchased the balance of this decree a portion of which had been attached by other creditors from Defendant No. 2. 5. The relief sought was (1) that the suit be decreed for recovery of Rs. 33, 125, (namely Rs 30,000 payable to Government plus Rs 3,125 misappropriaed from the monies of the Plaintiff's firm, (2) that it be declared that the aforesaid transfers are null and void as against the Plaintiff and (3) that the Plaintiff be authorised to recover the decretal amount by sale of the hypothecated property and of all the property belonging to Defendant No. 1, the Plaintiff having a prior charge upon such property. 6. There were two other Defendants to the suit, Defendants Nos. 5 and 6, but they do not coma into the picture and may be ignored. 7. The case of Defendant No. 3 was that the security bond was only good for Rs. 10,000 that he had a paramount title in respect to the half share of the Karkhana Bazar house which was sold at auction, that Defendant No. 1 had no interest in the other share of the aforesaid house which Defendant No. 3 purchased from Defendant No. 2 and that the suit was barred by the principle of res judicata as regards the amount of the Plaintiffs' incumbrance. 8. The defence of Defendant No. 4 was that the security bond created no charge upon the decree which he had purchased, and that if there was any such charge upon it, this Defendant was a bona fide purchaser for value without notice of the aforesaid charge. 9. The Court below has decreed the suit for the whole amount claimed in the following terms: I, therefore, decree the suit to the amount of Rs 33,126 with past and future interest at 6% and costs as against 1 to i inclusive. Defendants Nos. 5 and 6 will get their costs from Plaintiff, suit against them being dismissed. I further grant to Plaintiff a declaration that the transfers of the half share of the Karkhana Bazar house to Jagat Sing and a part of a decree for Rs.
Defendants Nos. 5 and 6 will get their costs from Plaintiff, suit against them being dismissed. I further grant to Plaintiff a declaration that the transfers of the half share of the Karkhana Bazar house to Jagat Sing and a part of a decree for Rs. 10,047-6 to Gosain Singh are null and void ; and that he may have these two properties sold in execution of the decree issuing on this suit, and also that he may recover the decretal amount by the sale of these two properties and any other property belonging to Prem Lal. 10. It is in evidence that in execution proceedings under S. 386 Criminal Procedure Code. the half share of Defendant No. 1 in certain property-or what the executing authority apparently regarded as being his share in the property-was attached and was put up for sale, and on the 20th October, 1932 Defendant No. 3 purchased this half share in the Karkhana Bazar house and 1 l/16ths nalis of land appurtenant thereto-vide the sale certificate dated 11th January 1933 at page 147 of our paper-book. The amount paid was Rs. 5,510-8 There is an order of the Deputy Commissioner dated 3rd January 1938 at page 145 of our paper book, which indiraies that the half share of the Karkhana Bazar house was sold to Defendant 3 for Rs 1,610; but, as will appear hereafter, this represents only so much of the sale proceeds as went in liquidation of the fine which had been imposed upon Defendant No. 1. Lot No. 1 mentioned in this order admittedly relates to the Karkhana Bazar house and is therefore the same as what is shown in the sale certificate-apparently by mistake-as lot No. 2. It also appears from this order of 3rd January 1933 that lot no. 3, that is to say the 11/lcths nalis of land, was sold for Rs. 608-4, of which Rs. 455 went towards the fine while the balance of Rs 153-4 was the proportionate amount of the Plaintiff's encumbrance of Rs 10,000 This order, as we have already said, does not actually 49 specify what amount was paid to the Plaintiff from the sale proceeds of the half share of the house as the proportionate amount of the aforesaid encumbrance, but it is a matter of admission that the Plaintiff received Rs.
3,000 odd on this account We may mention that this order of the Deputy Commissioner dated 3rd January 1933 was passed in connection with an objection by the Plaintiff Under S. 386 o Criminal Procedure Code. read with Order 21, rule 90 Civil Procedure Code, in which the Plaintiff claimed that his encumbrance ought to have been notified as Rs. 30,000 and not Rs. 10.000 but his objection was dismissed, apparently on the ground that the fine due to Government was a first charge upon the property. From this order the Plaintiff appealed to the District Judge, but his appeal was dismissed on the 25th August, 1933. In the judgment of that Court it is stated that, out of the price paid by Defendant No. 3 for the half share of this house, a sum of Rs. 3,282/4 was received by the Plaintiff, this representing the proportionate amount of the encumbrance of Rs. 10,000 upon the whole house. We have already seen that out of the sale proceeds of the half share of this house a sum of Rs. 1,610 was paid towards the fine and that out of the sale proceeds of the ll/16ths nalis of land amounting to Rs. 608/4, a sum of Rs. 455 want towards the fine and a sum of Rs. 135/4 was received--or so it appears from the order 3rd January, 1933--by the Plaintiff as the proportionate amount due to him upon this property in respect to his encumbrance of Rs. 10,000. There is no explanation of the difference in the ratio of apportionment in the sale proceeds of this patch of land and the sale proceeds of the half share of the house. Anyway, the total of these various sums amounts to Rs. 5,502/8 and there is thus a flight discrepancy of Rs. 8 between this total and the sale proceeds as shown in the sale certificate dated 17th January, 1933. 11. Meanwhile, Defendant No. 3 had purchased the other half of this Karkhana Bazar house on the 5th October, 1932, by private sale from Defendant No. 2. Thus by means of this private sale and the sale at auction Defendant No. 3 became-- subject to the result of this litigrtion--the owner of the whole house in the Karkhana Bazar. 12. We shall first take up appeal No. 498 of 1934, in which Defendant No. 3 is the Appellant.
Thus by means of this private sale and the sale at auction Defendant No. 3 became-- subject to the result of this litigrtion--the owner of the whole house in the Karkhana Bazar. 12. We shall first take up appeal No. 498 of 1934, in which Defendant No. 3 is the Appellant. The first plea taken on his behalf by Mr. P.L. Banerji is that the charge on the property is limited to Rs. 10,000 and the security bond cannot be enforced for more than this amount; and it is also pleaded that this issue is res judicata. 13. It is admitted in the plaint that the security bond was executed "in the penal sum of Rs. 10,000". In paragraph 3 of the security bond it is stated that the Plaintiff will be a liberty to realise from me or my property given below your entire money or loss, whatever may be found, with interest or damages as you like. 14. In paragraph 5 it is stipulated that, "This property shall remain pledged as security to you for Rs. 10,000 In our opinion the only possible meaning which can be attached to these recitals is that the executant incurred a personal liability for whatever loss the Plaintiff might suffer and that the property hypothecated was charged to the extent of Rs. 10,000 only. 15. The learned District Judge in his judgment dated 25 th August 1933 in appeal against the Deputy Commissioner's order of 3rd January, 1933 which was passed in respect to an objection by the Plaintiff under S. 385 Criminal Procedure Code. read with Order 21, Rule 90 Civil Procedure Code,. said: As for the third objection, that to enter only Rs. 10,000 as the encumbrance is incorrect, from a perusal of this security or indemnity bond I find that prima facie this bond appears to be for Rs. 10,000 only and I find the objection to have no force. 16. This amounts to a finding, we think, that upon a plain reading of the terms of the security bond a charge was created to the extent of Rs. 10,000 on the property secured. This finding operates as res judicata between the parties. 17. We accordingly accept the contention of Learned Counsel for the Defendant Appellant in respect to both these points. 18.
10,000 on the property secured. This finding operates as res judicata between the parties. 17. We accordingly accept the contention of Learned Counsel for the Defendant Appellant in respect to both these points. 18. The next plea taken is that there is no longer any liability upon the half share of the Karkhana Bazar house which was sold at auction to satisfy the proportionate of the Plaintiff's claim. A half-hearted attempt was made to show that this issue also is res judicata, but there is no force in the contention. The question remains whether the Plaintiff is or is not entitled to enforce his claim against this property which was put up for sale subject to the Plaintiff's encumbrance of Rs. 10,000. In this connection it is pointed out that under the judgment and decree of the Court below there is no declaration in respect to this half share of the Karkhana Bazar house. The sale proceeds of this half share-excluding the 11 / 16ths nalis of land is stated by the District Judge in his judgment of 25th August 1933 to have been Rs. 4,894-4-0 of which Rs. 1,610 went towards payment of fine and Rs. 3,284/4 was paid to the Plaintiff. This sum represented the proportionate amount of the charge of Rs. 10.000 on the whole house-not on the half share only. It is admitted before us that the Plaintiff received Rs. 3.000 odd out of the sale proceeds of the auction sale and we may, therefore, take the District Judge's figures as correct. Thus the sum of Rs. 3,234-4- cannot possibly rep esent less than the proportionate amount of the Plaintiff's charge on the half share sold. Learned Counsel for the Plaintiff Respondent contends that the integrity of the mortgage was not broken a d therefore the Plaintiff is not confined to realising the proportionate amount only of his charge from the property bought by the Defendant Appellant at auction. He admits, however, that in execution of the decree under appeal the Plaintiff has put to sale and has purchased the Khazanchi mohalla house for Rs. 4,000. This is one of the two properties which were hypothecated under the security bond. Thus he has himself now broken the integrity of the mortgage, and we think that we are justified in taking notice of this fact.
4,000. This is one of the two properties which were hypothecated under the security bond. Thus he has himself now broken the integrity of the mortgage, and we think that we are justified in taking notice of this fact. The position, therefore, is that the Plaintiff is not entitled to enforce his charge any further against the half share of the Karkhana Bazar house which was sold at auction; and since it is a valid sale, he cannot proceed against this property on the basis of the Defendant Appellant's personal liability. 19. The last question which we have to decide in this appeal relates to the other half share of the Karkhana Bazar house, which was sold by Ratan Lal, Defendant No. 2. to the Defendant Appellant on the 5th October, 1932. The major part of the consideration was a decree for Rs. 3,558 which had been obtained by the Defendant Appellant against Defendant No 1, as appears from the recitals in the sale-deed. These recitals also show that Defendant No. 2 was selling this half share as exclusive owner thereof. The Court below has found that Defendant No. 1 was the sole owner of this property, but Learned Counsel for the Defendant Appellant contends that this is wrong; he pleads that Defendant No. 2 was the owner of this half share and was entitled to convey it to the Defendant Appellant. 20. The house was purchased at auction on the 20th October 1916. It appears that Defendant No. 1 had a cloth business in the name of Prem Lal-Ratan Lal, and the sals certificate of 2nd January 1917 shows that the house was sold to Prem Lal-Ratan Lal. Ratan Lal was born in November 1908 and was therefore under 8 years of age at the date of sale, and the view taken by the Court below is that Defendant No. 1 was the sole proprietor of the business and that the name of Defendant No. 2 was recorded benami in the sale-deed relating to this house. Learned Counsel for the Defendant Appellant challenges this finding. In his grounds of appeal he pleaded that Defendant No. 2 was the separate owner of this half house. In argument he contends that, whether Defendant No. 1 and Defendant No. 2 each owned a separate half share or whether it was joint family property, Defendant No 2 was equally competent to sell it.
In his grounds of appeal he pleaded that Defendant No. 2 was the separate owner of this half house. In argument he contends that, whether Defendant No. 1 and Defendant No. 2 each owned a separate half share or whether it was joint family property, Defendant No 2 was equally competent to sell it. This contention is repudiated on behalf of the Plaintiff Respondent, whose counsel pleads that the house was the exclusive property of Defendant No. l,as found by the Court below, and that Defendant No. 2 had no right to sell a half share in it. Inter alia he relies upon paragraphs 34 and 290 of Panna Lal's "Kumaun Local Customs." Paragraph 34 says : During the life time of a man his descendants have no share in or claim to the property, ancestral or self acquired. 21. In paragraph 290 the learned author says: I found absolute unanimity on the following points;-- (a) A son cannot demand a partition of his share against the wishes of the father. (h) The family property in the hands of the father is not liable to be seized in execution of decrees against the son for his separate debts, whereas the whole of the property can be attached and sold to satisfy a decree against the father for his debts, thus leaving nothing for the sons. (c) The son cannot alienate any part of the property in the life-time of the father. Thus the three principal characteristics of a Mitakshara coparcener are not to be found in the case of the son in Kumaun. Their position rather resembles that of son in the Dayabhaga. It follows that during his father's life-time he is not a co-parcener in the sense the term is used in Hindu Law. He has no share in the family property until his father's death. 22. In Lachham Singh v. Jhagar Singh 1939 A.W.R. (H.C.) 288 : A.L.J. 213, this Bench held that the customs mentioned in Panna Lal's book apply to the Kha-as and not necessarily to the Hindu immigrants from the plains, who, in the absence of evidence to the ccntrary, will be deemed to be governed by the law of the country from which they migrated. At page 219 we made some observations about the Sahs, to which class Defendants Nos. 1 and 2 also belong.
At page 219 we made some observations about the Sahs, to which class Defendants Nos. 1 and 2 also belong. Learned Counsellor the Defendant Appellant pleads that this custom ought to have been specifically set up in the plaint. It was certainly not set up there, but we must bear in mind the fact that the parties are residents of Kumaun, where the suit was tried, and it is clear from the judgment of the Court below that reference was made to Panna Lal's book, for the learned Judge has mentioned paragraph 34 of the aforesaid book though the sentence in which he refers to it is not easily intelligible. Upon the whole matter we are of opinion that we would not be justified in shutting out the Defendant Appellant from pleading this custom in appeal before us. This and various other questions arising out of the salt of a half share of the house by Defendant No. 2 cannot, however, be satisfactorily decided on the materials before us and we are therefore constrained to remit the following issues to the Court below: 1. Whether Defendants Nos. 1 and 2 are governed by the Mitakshara law or by the customary law of Kumaun ? 2. Whether Defendants Nos. 1 and 2 were members of a joint Hindu family ? 3. Whether at the date when Defendant No. 1 started the business known as Prem Lal Ratan Lal there was a nucleus of joint family property ? 4. Alternatively, whether Defendant No 2 was admitted to the benefits of this business ? If so, when and in what manner ? 5. The parties will be at liberty to adduce such additional evidence as may be relevant to the above issues. The findings should be returned within three months, and thereafter the usual ten days will be allowed for objections. 6. We will now take up Appeal No. 362 of 1934. On the 2nd August 1923 a suit was instituted against one Bishan Singh for recovery of Rs. 6,57+. The Plaintiff to the suit was designated as "Lala" Prem Lal, aged 50 years, son of Lala Hira Lal Chaudhri, owner of shop Lala Prem Lal Ratan Lal Chaudhri, cloth merchant........ 7. The Plaintiff apparently obtained a decree in this suit. This decree (the amount of which had by now risen to Rs 10, 047-6) was attached to the extent Rs.
7. The Plaintiff apparently obtained a decree in this suit. This decree (the amount of which had by now risen to Rs 10, 047-6) was attached to the extent Rs. 5, 374 by certain creditors. On the 16th February 1933 Defendant No. 2 sold the balance of the decree to the Defendant Appellant, Gosain Singh Nain Mal, for Rs. 4, 676 in satisfaction of a debt due to. the vendee. It is recited in the sale-deed tha the vendor is selling the decree. for himself and as a decree-holder and son and heir of Lala Prem Lal Sah Chaudhri. 23. Further on there is a recital to the following effect: My father is undergoing his sentence in the Bareilly jail. I am his heir and I have obtained his consent. 24. This decree formed no part of the property charged in the security bond, but it is pleaded on behalf of the Plaintiff Respondent that it was the exclusive property of Defendant No. 1--as held by the Court below--and that Defendant No. 2 had no right to sell it. Learned Counsel for the Defendant Appellant on the other hand contends that the transfer by Defendant No. 2 was valid and that this property cannot now be touched by the Plaintiff Respondent. It is further pleaded on behalf of the Defendant Appellant that no suit lies in respect to this decree under S. 42 of the Specific Relief Act. 25. S. 42 provides: Any person entitled to any legal character, or to any right as to any property, may institute a suit against any person denying or interested to deny his title to such character or right, and the Court may, in its discretion, make therein a declaration that he is so entitled, and the Plaintiff need not in such suit ask for any further relief : Provided that no Court shall make any such declaration where the Plaintiff, being able to seek further relief than a mere declaration of title, omits to do so. 26. The Defendant Appellant did not deny and was not interested in denying the Plaintiff's legal character as a creditor of Defendant No. 1.
26. The Defendant Appellant did not deny and was not interested in denying the Plaintiff's legal character as a creditor of Defendant No. 1. And as regards the Plaintiff's rights to the property, he was not competent to claim in this suit a declaration as regards this particular item of property, which was not charged in the security bond and to which, at the date of the institution of the suit, he had no right. 27. In Mohummud Zahoor Ali Khan v. Mst. Thakooranee Rutta Koer (1867) 11 M.I. A. 468, a suit on a simple bound was instituted against one Mst. Rutta Koer. The Plaintiff also impleaded as Defendants 9 other persons on the ground that they had illegally had certain estates belonging to Mst. Rutta Koer transferred to themselves. It was prayed that the amount claimed be decreed against the Defendants and the aforesaid estates. Their Lordships of the Privy Council held that the Plaintiff had no ground of suit against the transferee Defendants inasmuch as the instrument which was the basis of the suit created no charge upon the estates transferred. At page 473 their Lordships say : If he (the Plaintiff) can obtain judgment on his bond and is not satisfied, he may possibly be entitled hereafter to raise such a case as that suggested in the plaint against the land and against the Defendants ; but any such proceedings before execution on the judgment are premature. 28. It is true that the Specific Relief Act had not then been enacted, but the principle is as good today as it was in 1867, when the judgment of the Privy Council was pronounced. 29. So far as the subject of this appeal is concerned, reliefs (b) and (c) in the plaint amount to this, that the Plaintiff was claiming a declaration that the transfer of the decree is null and void as against him and that the decree which he may obtain under relief (a) will be executable against it. It was held by a Full Bench of the Rangoon High Court in Mating Ba Mating v. Maung Ba Yin, AIR 1939 Rang. 332 that a creditor cannot sue under S. 42 of the Specific Relief Act for a bare declaration that a transfer of movable property has been made by his judgment-debtor. 30.
It was held by a Full Bench of the Rangoon High Court in Mating Ba Mating v. Maung Ba Yin, AIR 1939 Rang. 332 that a creditor cannot sue under S. 42 of the Specific Relief Act for a bare declaration that a transfer of movable property has been made by his judgment-debtor. 30. That case is distinguishable to this extent that the Plaintiff there had apparently already obtained a decree ; but we think that the observations in the judgment apply with even greater force to the case which is before us. 31. In our opinion the Plaintiff was not entitled to sue for a declaration in respect to this decree and therefore the appeal of Gosain Singh Nain Mal must succeed. We accordingly allow this appeal and set aside the decree of the Court below so far as this Appellant is concerned. Having regard to the fact that the bar of S. 42 of the Specific Relief Act was not pleaded in the written statement and was not specifically pleaded in the grounds of appeal (ground No. 4 being of a wide and general scope), we make no order as to costs as between the Defendant Appellant and the Plaintiff Respondent. 32. Defendants Nos. 5 and 6 have been unnecessarily impleaded in this appeal and they are therefore entitled to recover their costs from the Defendant Appellant.