Vanimisetti Anil Kumar v. Jayavarapu Krishna Murthy (died)
2003-01-10
BILAL NAZKI, G.ROHINI
body2003
DigiLaw.ai
( 1 ) THIS is an LPA filed by the defendants 2 and 4 to 6 against the judgment of the learned single Judge of this Court dt. 28. 4. 1994 passed in AS no. 1207 of 1991 who confirmed the judgment and decree of the trial Court in O. S. No. 65 of 1984. The parties will be referred to as they appeared in the suit as plaintiffs and defendants . ( 2 ) THE facts on the basis of which the suit was filed were that the suit schedule property was the joint family property of the defendants. This suit schedule property along with adjacent terraced building was mortgaged to one Kola Rama Rao of Eluru for Rs. 30,000/- on 17. 7. 1979 by the defendants for discharge of antecedent debts of the joint family. The defendants, with a view to shift their residence and settle down permanently at Tirunalveli Ashram in Tamil Nadu and in order to discharge the antecedent debts, wanted to dispose of their properties at jangareddigudem and Tadepalligudem. Therefore, they published a notice in the daily newspaper of Andhra Prabha on 14. 10. 1980. On coming to know of this, the plaintiffs approached the defendants with a view to purchase the property at Jangareddigudem village. They were told by the 1st defendant that he was selling the property to discharge the antecedent debts and with a view to permanently shift their residence to Tirunalveli Ashram in tamil Nadu. The suit schedule property was in a neglected condition, which required immediate repairs. Enquiries made bythe plaintiffs revealed that the defendants were indebted to Kola Rama Rao and others and the creditors were demanding the payments. After due enquiry, the plaintiffs were satisfied that there was necessity to sell the suit schedule property and approached the defendants with a view to purchase the same. The defendants and the plaintiffs are related to each other. After some negotiations, it was agreed between the parties on 31. 8. 1981 in presence of mediators that the defendants would sell the suit schedule property for rs. 1,02,900/- so that the defendants were able to discharge the mortgage debts. The defendants were supposed to discharge the mortgage debts out of the amount paid by the plaintiffs.
After some negotiations, it was agreed between the parties on 31. 8. 1981 in presence of mediators that the defendants would sell the suit schedule property for rs. 1,02,900/- so that the defendants were able to discharge the mortgage debts. The defendants were supposed to discharge the mortgage debts out of the amount paid by the plaintiffs. An agreement of sale was executed by the 1st defendant for himself and as a guardian for 2nd defendant who was a minor, in favour of the plaintiffs on that day. The said agreement of sale was executed in presence of witnesses. An advance of Rs. 22,900/- had to be paid at the time of agreement of sale. Out of the balance of rs. 80,000/- the plaintiffs had to pay Rs. 10,000/- on or before 1. 10. 1981 and the balance of Rs. 70,000/- had to be paid by the end of December, 1981. There was another condition stipulated in the agreement of sale that if the plaintiffs failed to pay the balance amount by 31. 12. 1981, it had to be paid with interest @ 1% per mensum. The extent of the site which was agreed to be sold is 566 sq. yards, but it was also agreed that if on measurements it was found to be less than 566 sq. yards, the consideration amount would be paid proportionately less. The site had to be measured before the registration. Possession of the property had to be delivered at the time of registration. There were some other terms and conditions in the agreement. The plaintiffs further contended that in pursuance to the agreement of sale the plaintiffs paid to the defendants Rs. 22,900/- on 31. 8. 1981, Rs. 15,000/- on 15. 10. 1981 through T. V. A. Narasimha Rao, rs. 5,000/- on 9. 1. 1982 in cash, Rs. 10,000/- on 10. 1. 1982 through T. V. A. Jagannadham, Rs. 3,000/- on 23. 2. 1982 in cash, Rs. 3,000/- on 4. 5. 1982, rs. 3,000/- on 13. 4. 1982 by way of draft, Rs. 12,000/- on 19. 5. 1982 through t. V. A. Jagannadham and Rs. 5,000/- on 2. 6. 1982 in cash. All these payments were endorsed on the agreement of sale by the 1st defendant in his own handwriting and were signed by him. In all, the plain tiffs made payments to the tune of Rs. 78,900/- to the defendants by 2.
12,000/- on 19. 5. 1982 through t. V. A. Jagannadham and Rs. 5,000/- on 2. 6. 1982 in cash. All these payments were endorsed on the agreement of sale by the 1st defendant in his own handwriting and were signed by him. In all, the plain tiffs made payments to the tune of Rs. 78,900/- to the defendants by 2. 6. 1982. The plaintiffs were always ready and willing to perform their part of contract, but the defendants were postponing on some pretext or the other. The 1st defendant had promised to obtain the mortgage bond back and execute a sale deed before leaving for Tirunalveli. As the defendants were away and living in Tirunalveli in Tamil Nadu, the plaintiffs could not secure the presence of the defendants to measure the site and arrive at the exact consideration to be paid and obtain a sale deed. After return of the 1st defendant from Tirunalveli, the plaintiffs requested him in presence of mediators to discharge the mortgage debt and get the site measured and receive the balance of consideration arrived at according to the terms of the agreement. The defendants did not comply with the request. On 12. 9. 1983 Kola Rama Rao of Eluru gave a notice to the defendants and the plaintiffs demanding payment of his mortgage debt. After receipt of the notice, the plaintiffs requested the defendants to discharge the mortgage debt and obtain the mortgage bond back and receive the balance of sale consideration from them and execute a sale deed in their favour, but the defendants did not give the discharged mortgage bond to the plaintiffs. ( 3 ) THEREAFTER the plaintiffs issued a notice on 21. 11. 1983 demanding the defendants to discharge the mortgage debt and adhere to the terms of the sale agreement. The notice was served on the 1st defendant on 30. 11. 1983. ( 4 ) HE gave a reply to the notice on 12. 12. 1983 admitting the execution of the agreement of sale and also receipt of part of sale consideration. It was contended by the 1st defendant in the reply that in May, 1983 the defendants had demanded payment of balance of consideration, but the plaintiffs had refused to pay the amount and therefore the plaintiffs were not ready to obtain a registered sale deed.
It was contended by the 1st defendant in the reply that in May, 1983 the defendants had demanded payment of balance of consideration, but the plaintiffs had refused to pay the amount and therefore the plaintiffs were not ready to obtain a registered sale deed. He also contended in the reply that there had been a settlement in the last week of September, 1983. The 1st defendant also contended in the reply that there was collusion between the plaintiffs and T. V. A. Jagannadham and T. V. A. Narasimharao. ( 5 ) THE plaintiffs contended that there was no cancellation of the agreement of sale at any time. There was no settlement between the plaintiffs and the defendants at any time and there was no collusion between the plaintiffs and T. V. A. Jagannadham and T. V. A. Narsimharao. The plaintiffs also contended that they were ready to pay the balance of sale consideration as and when the Court directed. They also contended that by virtue of the hindu Succession (Amendment) Act, the defendants 4 to 6 who were unmarried daughters of the 1st defendant were co-parceners and they were bound by the agreement of sale entered into by the 1st defendant as Kartha of the family. The sale was effected for legal necessity and for benefit of the defendants family and as such the defendants 4 to 6 were liable to execute a registered sale deed along with defendants 1 and 2. ( 6 ) IN the written statement filed by the defendant Nos. 1 and 2 the execution of the agreement of sale was admitted. It was also admitted that the defendants had executed a mortgage deed dt. 17. 7. 1979 in favour of one kola Rama Rao, but it was contended that the mortgage deed was executed as a guarantee to one Vandanapa Laxmana Rao who wanted to obtain a running loan of Rs. 30,000/- to promote his business. It was denied that the mortgage deed was executed for discharging the antecedent debts by the defendants. Issuance of the notice in Andhra Prabha newspaper on 14. 10. 1980 was also admitted. Some of the payments were admitted, but it was contended that certain payments made by the plaintiffs through some persons were not received by the defendants and, in fact, only payment of rs. 51,900/- had been received by them.
Issuance of the notice in Andhra Prabha newspaper on 14. 10. 1980 was also admitted. Some of the payments were admitted, but it was contended that certain payments made by the plaintiffs through some persons were not received by the defendants and, in fact, only payment of rs. 51,900/- had been received by them. It was also contended that the plaintiffs were not in a position to pay the balance amount and were not ready to get executed a registered sale deed. It was also contended that in reply to the notice dt. 9. 12. 1983 the defendants set out detailed events and negotiations that took place between the defendants and the plaintiffs through mediators and also claimed settlement arrived at between the parties rescinding the agreement. ( 7 ) IT was contended that as per the settlement between the parties before T. V. A. Narsimha Rao, T. V. A. Jagannadha Rao, K. Vidhadara Rao, Atluri Venkata Ratnam and others both the parties executed a letter of agreement canceling the suit agreement. As per the recitals of the letter, the defendants were liable to pay an amount of Rs. 51,400/- to the plaintiffs with interest @ 12% P. A. on or before 30. 4. 1984. The said settlement had taken place in the last week of september, 1983. This letter was kept in the custody of T. V. A. Jagannadha rao. The defendants requested the plaintiffs to send a Photostat copy of the agreement along with letter of agreement executed by both the parties, but they failed to comply with this request. Additional written statement was filed by the 1st defendant which was adopted by 2nd defendant contending that the 1st defendant had sold away 36 sq. yards of vacant site to the 3rd defendant by way of registered sale deed dt. 10. 12. 1987 for Rs. 13,500/- and possession was immediately delivered to the 3rd defendant. ( 8 ) DEFENDANT No. 3 filed his written statement contending that he purchased 36 sq. yards from 1st defendant under a registered sale deed dt. 10. 12. 1987 and he is in possession of the said site. Defendant Nos. 4 to 6 filed their written statement contending that they were members of the Hindu joint family along with defendants 1 and 2. The co-parcenary had extensive movable and immovable properties.
yards from 1st defendant under a registered sale deed dt. 10. 12. 1987 and he is in possession of the said site. Defendant Nos. 4 to 6 filed their written statement contending that they were members of the Hindu joint family along with defendants 1 and 2. The co-parcenary had extensive movable and immovable properties. 1st defendant was addicted to several vices like drinking and gambling and began to sell away the co-parcenary properties for his vices. He left the defendants 4 to 6 and his wife at Jangareddigudem village and went to other places to lead a lonely life. The defendants 2, 4 to 6 and their mother were living by collecting rents accrued from the immovable properties of the joint family. The defendants 4 to 6 were under the protection of their mother, but not under 1st defendant. ( 9 ) 2nd defendant filed additional written statement after attaining majority alleging that the agreement was not true and was not supported by consideration. The payments endorsed on the back of the agreement were not true. The plaintiffs were never ready and willing to perform their part of contract. ( 10 ) ON the basis of these pleadings, the trial Court framed number of issues for trial. The following 6 issues were framed in the first instance, (1) Whether the plaintiffs are always ready and willing to perform their part of contract? (2) Whether the plaintiffs did not pay all the amounts to the defendants as shown in the plaint? (3) Whether the defendants have committed any breach of contract and whether the plaintiffs are entitled to claim any damages of Rs. 10,000/-? (4) Whether the plaintiffs are entitled to claim damages at Rs. 1,00,000/-? (5) Whether the court fee paid is correct? (6) To what relief? ( 11 ) THEN on 13. 6. 1989 the following additional issues were framed, (1) Whether the sale deed dated 10. 12. 1987 in favour of D-3 is valid and binding on the plaintiffs? (2) Whether the 3rd defendant is a bonafide purchaser without notice of the suit agreement? (3) To what relief? on 20. 11. 1990 the following issues were framed, (1) Whether the suit agreement is valid, passed by consideration and binding on defendants 4 to 6? (2) Whether the claim against defendants 4 to 6 is within time? (3) To what relief? again on 17. 12.
(3) To what relief? on 20. 11. 1990 the following issues were framed, (1) Whether the suit agreement is valid, passed by consideration and binding on defendants 4 to 6? (2) Whether the claim against defendants 4 to 6 is within time? (3) To what relief? again on 17. 12. 1990 the following two issues were framed, (1) Whether the suit contract is not enforceable against D-2 for want of legal necessity? (2) Whether the settlement pleaded by the 1st defendant in his written statement is true? ( 12 ) THE plaintiffs examined three witnesses and marked Exs. A1 to A29 on their behalf. The defendants examined six witnesses and marked Exs. B1 to B27 on their behalf. On the basis of the findings given on these issues, the trial Court passed a decree in favour of the plaintiffs, which was confirmed by a learned single Judge of this Court. Now this LPA has been filed. Judgments of the trial Court as well as the learned single Judge have been assailed on three counts by the learned senior counsel appearing for the appellants. Firstly, he contended that the suit agreement was not for legal necessity and for the benefit of the family of defendants. Secondly, he contended that the suit agreement was not for discharge of antecedent debts and thirdly he argued that the plaintiffs were not always ready and willing to perform their part of contract and therefore they were not entitled to sue for specific performance of the agreement. He further stated that even if the agreement was found to be true, the share of 1st defendant i. e. , father could only have been sold and the agreement with regard to the shares of son and daughters of the 1st defendant was void. ( 13 ) THE trial Court and the learned single Judge came to the conclusion that the legal necessity of the family had been proved. It is a question of fact and in letters patent appeal it is always difficult to set aside the findings on the fact. It is true that in the agreement there was no mention of any debts, but it had been mentioned that the family wanted to settle at a different place.
It is a question of fact and in letters patent appeal it is always difficult to set aside the findings on the fact. It is true that in the agreement there was no mention of any debts, but it had been mentioned that the family wanted to settle at a different place. Although the defendants who are the son and daughters of the 1st defendant had contended that there was no family necessity and there were no debts, but it had been proved during the trial that the property was under mortgage and an amount of Rs. 30,000/- had been advanced to the 1st defendant. It was also contended by these defendants that their father was addicted to all vices like drinking and gambling and therefore he was selling away the properties for his own benefit and not for the benefit of the family. But both the trial Court as well as the learned single Judge came to the conclusion that there was no evidence produced to substantiate this allegation. It was also contended that there was a settlement in between the parties by which the agreement of sale was rescinded and an amount of Rs. 51,400/- had to be paid by the defendants towards the plaintiffs. This settlement was not proved either before the trial Court or before the first appellate Court and there is no evidence in this connection. ( 14 ) NOW coming to the question as to what constitutes a legal necessity. Various judgments have been pressed into service. In a judgment reported in Rani V. Santa Bala the Supreme Court held in paras-10 and 11,"10. Legal necessity to support the sale must however be established by the alienees. Sarala owned the land in dispute as a limited owner. She was competent to dispose of the whole estate in the property for legal necessity or benefit to be estate. In adjudging whether the sale conveys the whole estate, the actual pressure on the estate, the danger to be averted, and the benefit to be conferred upon the estate in the particular insistence must be considered. Legal necessity does not mean actual compulsion; it means pressure upon the estate, which in law may be regarded as serious and sufficient.
In adjudging whether the sale conveys the whole estate, the actual pressure on the estate, the danger to be averted, and the benefit to be conferred upon the estate in the particular insistence must be considered. Legal necessity does not mean actual compulsion; it means pressure upon the estate, which in law may be regarded as serious and sufficient. The onus of proving legal necessity may be discharged by the alienee by proof of actual necessity or by proof that he made proper and bona fide enquiries about the existence of the necessity and that he did all that was reasonable to satisfy himself as to the existence of the necessity. 11. Recitals in a deed of legal necessity do not by themselves prove legal necessity. The recitals are, however, admissible in evidence, their value varying according to the circumstances in which the transaction was entered into. The recitals may be used to corroborate other evidence of the existence of legal necessity. The weight to be attached to the recitals varies according to the circumstances. Where the evidence which could be brought before the Court and is within the special knowledge of the person who seeks to set aside the sale is withheld, such evidence being normally not available to the alienee, the recitals go to his aid with greater force and the Court may be justified in appropriate cases in raising an inference against the party seeking to set aside the sale on the ground of absence of legal necessity wholly or partially, when he withholds evidence in his possession. " ( 15 ) A Division Bench of this Court in B. Ranga Rao (died) V. G. Venkata Krishna rao, after considering the whole law on the point including the judgments of the Supreme Court as well as the judgments of the Privy council, laid down the following principles, which according to it, emanated from the above judgments, (1) "the Kartha of Hindu Joint family has got the power to alienate the joint family property only for legal necessity or for the benefit of the family. (2) Where the joint family property is sold for legal necessity or for the benefit of the family, the degree of prudence, which is required for the kartha of the joint family, who is not the sole owner of the property, is greater than that of the owner, and like a trustee.
(2) Where the joint family property is sold for legal necessity or for the benefit of the family, the degree of prudence, which is required for the kartha of the joint family, who is not the sole owner of the property, is greater than that of the owner, and like a trustee. (3) When the sale is only for legal necessity, the burden on the alienee is to show that the sale itself was justified by legal necessity and he is under no obligation to enquire into application of sale amount in detail by the kartha as alienee has no control over him. (4) Where the sale of joint family property is for the benefit of the family, the alienee has to take reasonable care to find out whether the sale, in fact, was for the benefit of the family on the date of transaction, which includes to find out that the sale was for the purchase of other property or better investment; that the sale consideration was actually utilized for the purpose of purchasing other lands for the benefit of the family. " ( 16 ) BASING on these principles the learned counsel for the appellants submits that it was not proved that there was any earlier unpaid debt of the family and if any debt had been taken for the family, therefore the sale agreement itself was bad. The learned counsel for the respondents, on the other hand, contended that it was for the first time the plea of sale agreement having been executed against the interest of the family was taken by the son of the 1st defendant on his attaining the majority, although on his behalf also the 1st defendant had filed written statement. ( 17 ) HE contends that a minor has a right to challenge the actions taken on his behalf by his guardian while in minority on attaining the majority, but that could be done only by filing a suit and not by filing an additional written statement on attaining the majority.
( 17 ) HE contends that a minor has a right to challenge the actions taken on his behalf by his guardian while in minority on attaining the majority, but that could be done only by filing a suit and not by filing an additional written statement on attaining the majority. On this question also many judgments have been pressed into service by the learned counsel for the parties, but this question appears to be academic in nature and we do not intend to decide this question because in terms of the principles which were carved out by the Division Bench of this Court which have been referred to above it is for alienee also to show that the sale was being effected for the legal necessity and for the benefit of the family and on this score there is already sufficient evidence that the agreement had been executed for legal necessity and for the benefit of the family. ( 18 ) THE trial Court as well as the learned single Judge of this Court, after analyzing the evidence in detail, came to the conclusion that there was a mortgage debt and an amount of Rs. 30,000/- had to be paid to discharge the mortgage debt and that the family intended to shift its residence from andhra Pradesh to Tamil Nadu in order to have a better living. Therefore, the question as to whether the 2nd defendant should have filed a suit on attaining the majority and not additional written statement would not be important in the facts and circumstances of the case. ( 19 ) NOW the learned counsel for the appellants further submits that had there been any necessity to discharge the mortgage debt, then the amount would have been immediately paid after it was received from the plaintiffs, but it was discharged by the defendants after four years of the agreement by selling away another property. That would not be important because on the date when the property was agreed to be sold to the plaintiffs, there was a need for the defendants to dispose of the property to discharge the family debt and as such there was a legal necessity. After receiving the amount, the plaintiffs had no control as to how the defendants would finally spend the amount received as a result of agreement of sale.
After receiving the amount, the plaintiffs had no control as to how the defendants would finally spend the amount received as a result of agreement of sale. ( 20 ) THEREFORE, whether the amount was used for discharge of the mortgage debt or not, would not be a material question. Hence we have no doubt to hold that the learned trial Court and the learned single Judge of this Court have arrived at the right conclusion that the suit agreement was executed for a legal necessity and for the benefit of the family. This finding takes care of the second argument, which was made to the effect that the suit agreement was not for discharge of antecedent debts. Now the only argument which remains is that whether the plaintiffs were ready and willing to perform their part of the agreement. In this connection, the learned counsel for the appellants submits that although the mode of payment was fixed in the agreement, but the payment was not made in accordance with the agreement and the payments were made in small instalments and even an instalment of Rs. 3,000/- was paid twice on 23. 2. 1982 and 4. 5. 1982. He contended that time was the essence of the contract, and therefore having failed to make payments in accordance with the schedule fixed in the agreement, it must be construed that the agreement could not be acted upon, firstly because the time was the essence of the contract, and secondly making payments in small instalments would itself show that the plaintiffs were not always ready and willing to perform their part of contract. The learned counsel for the respondents, however, submits that since the amounts were received in instalments and endorsed by the 1st defendant on the agreement, therefore, it has to be presumed that alteration of the schedule for making payments was accepted by the 1st defendant. Had the 1st defendant been serious to adhere to the schedule as mentioned in the agreement, then he would have not accepted the consideration amount in instalments in which it was paid to him. ( 21 ) HE could have always refused to receive the payments.
Had the 1st defendant been serious to adhere to the schedule as mentioned in the agreement, then he would have not accepted the consideration amount in instalments in which it was paid to him. ( 21 ) HE could have always refused to receive the payments. On the other hand, the payments were made not on schedule, but they were made in small instalments because the 1st defendant was not in a position to execute a registered sale deed, as he had not discharged the mortgage debt. He also further contended that the time was not the essence of the contract, which was manifest from the terms of the agreement because in case of delayed payments, there was a clause for payment of interest. So, at best, the interest could have been charged for the delayed payments and it could not be said that the time was the essence of the contract. Besides it is contended by the learned counsel for the respondents that the finding as to whether the plaintiffs were ready and willing to perform their part of contract was a finding of fact and the trial Court as well as the learned single Judge of this Court had come to the conclusion on the basis of evidence that the plaintiffs were always ready and willing to perform their part of contract, therefore this finding could not be disturbed. In this connection he relies on a judgment of the Supreme Court reported in n. P. Thirugnanam V. R. Jagan Mohan Rao. He contends that in the case before the Supreme Court the Courts below had found that the plaintiff was not ready and willing to perform his part of contract and therefore leave was not granted by the Supreme Court as it was found that it was a finding of fact. ( 22 ) THE learned counsel for the appellants then relied on a judgment of the supreme Court reported in Kanshi Ram V. Om Prakash Jawal stating that grant of a decree is not automatic, discretion had to be exercised on principle of justice, equity and good conscience. Since there has been a sweep rise in the prices, therefore the decree could have been refused.
Since there has been a sweep rise in the prices, therefore the decree could have been refused. ( 23 ) THERE is no evidence on record to show that there was increase in the prices of property, but, in any case, keeping in view the principle laid down in the above judgment and taking notice of the general trend that the value of the land is going up every day, we think it appropriate, while upholding the judgment and decree passed by the learned trial Court and the learned single Judge of this Court, to allow an interest @ 5% P. A. ( 24 ) FROM the date of suit till the date of deposit over the balance of amount which is yet to be paid to the defendants by the plaintiffs. A decree be drawn accordingly. With this modification, the appeal is dismissed. CROSS-OBJECTIONS (SR) No 52307 OF 1994: cross-objections have been filed by the plaintiffs for not allowing the costs. Since we have taken note of the escalation in the prices, therefore we uphold the finding of the trial Court that the parties shall bear their own costs. CMA No 1816 OF 1995: in view of the orders passed in the appeal and cross-objections, no separate orders are needed to be passed in this C. M. A. , which is accordingly dismissed.