Jagdev Singh vs Harinder Pal Singh

Rakesh Kumar Jain, J.—This appeal is by defendant No. 1 against the judgment and decree of both the Courts below by which suit filed by the plaintiff for possession of 1/4th share of land measuring 9 kanats 6 marlas including a house in dilapidated condition built therein, comprised in Khasra Nos. 92 and 90 situated at Village Kot Fatta, has been allowed. The brief facts are that defendant No. 2 sold the suit property to defendant No. 1/appellant on 30.6.1975 for a consideration of Rs. 1000/-. The sale was challenged by the plaintiff, who is the son of defendant No. 2 alleging that suit property is the coparcenary property which could not have been sold by defendant No. 2 without legal necessity or benefit of the estate and the sale was not binding on him. In the written statement filed by defendant No. 1/appellant, it was pleaded that the suit property was purchased by paying full consideration and the sale effected by defendant No. 2 in his favour, was an act of good management, for benefit of estate and legal necessity. It was further alleged that defendant No. 2 and his family is settled in Chandigarh after selling their entire property in village Kot Fatta. It was not possible for them to maintain the property in the village and also that the sale proceeds were required and utilized for construction of godown at Rajpura.

On the pleadings of the parties, following issues were framed:-

"1. Whether the plaintiffs and defendants No. 2 constitute a Joint Hindu Family? OPP

Whether the property in dispute was ancestral in the hands of defendants No. 2 qua the plaintiff and was their Joint Hindu Family property? OPP.

Whether the impugned sale is for consideration and legal necessity and by way of an act of good management? OPD

Whether the plaintiff has no locus standi to file the suit? OPD

Whether the plaintiff has no cause of action to file the suit? OPD

Whether the suit is not maintainable in the present form? OPD

Whether the plaintiff is only a figure head and the suit has been filed by defendants No. 2 to avoid the impugned sale. If so, its effect? OPD.

Whether the suit is properly valued for purposes of court fee and jurisdiction? OPD.

Whether the defendant No. 1 is entitled to special costs, if so, what amount? OPD.

Relief."

Both the parties led their respective oral as well as documentary evidence. The learned Courts below decreed the suit. It was held that defendant No. 2 was a Class-I Officer of Punjab Government and retired as Under Secretary. He constructed godown near Rajpura by taking a loan of Rs. 13 lacs from Vijaya Bank vide Exs. PX and PY, therefore, the sale of property in dispute for a meager amount of Rs. 1,000/- could hardly make any difference and held that it was not an act of good management. It was further held that in the sale deed Ex. DW 3/1, the necessity recited for money was for household expenses and not for the purpose of constructing the godown.

Learned counsel for the appellant has submitted that the aforesaid sale deed was earlier also examined by this Court when the appellant/defendant No. 1 filed a suit for possession of 3/4 share of the property in dispute against one Mohinder Singh, defendant No. 2 and Gobinder Singh. During trial of the said suit, defendant No. 2 never challenged the sale deed on any ground whatsoever including inadequacy of price and the suit was decreed holding the sale deed as valid. Thus, there is no dispute in so far as the sale consideration is concerned. It is further submitted that the property in dispute is situated in abadi and is not an agricultural land, therefore, there is no question of it rendering any income as observed by the learned Ist appellate Court. It is further submitted that defendant No. 2 was a Class-I Officer in the Government of Punjab and was permanently settled at Chandigarh. The plaintiff was also living with his father at Chandigarh and had attained majority when the sale took place. Defendant No. 2 disposed of all the properties at village Kot Fatta. The land in dispute as well as the dilapidated house existing therein was sold in order to arrange funds for the household expenses.

Thus, question of law that has been raised by the appellant, in the background of the aforesaid facts and circumstances is that "whether the sale in his favour can be set aside on the ground of lack of legal necessity/good management if the vendor is a prudent man, well versed with the ways of world and disposed of his property situated in the village, as it was of no use to him, having been settled elsewhere in the city"?

Learned counsel for the appellant has relied upon various judgments in support of his contention, namely, Sunder Das and others Vs. Gajananrao and others, , Murarka Properties (P) Ltd. Vs. Beharilal Murarka and Others, , Baijnath Prasad and Others Vs. Binda Prasad Singh and Others, , Vanimisatti Anil Kumar and Others Vs. Jayavarapu Krishna Murty and Others, , Medikenduri and Others Vs. Kata Venkatayya and Another, , Dasari Jayachandra Prasad and Others Vs. Dasari Venkata Subbaiah and Others, , Siri Kishan and Others Vs. Sanwal and Others, , Gangadharan Vs. Janardhana Mallan and others, and RSA No. 2004 of 1985 titled as "Gurnam Singh and others v. Charanjiv Bhardwaj and others decided on 21.9.2010.

In order to find put answer to the question, posed by learned counsel for the appellant, all judgments relied upon by him, are being dealt with separately.

In the case of Baijnath Prasad and others (Supra), it was held that ''Karta'' of a joint Hindu family being merely a manager and not an absolute owner, the Hindu law has placed certain limitations upon his powers to alienate property belonging to the joint Hindu family. The only reasonable limitation which can be imposed on a karta is that he must act with prudence and prudence implies caution as well as foresight and excludes hasty, reckless and arbitrary conduct. The Manager will thus not be allowed to enter into any transaction which may be speculative or fraught with risks or which may involve a possibility of loss to the family. It was held in the case of Vanimisatti Anil Kumar and others (Supra) that selling property for the purpose of migrating to a different place for better living has to be considered as for ''legal necessity''. In the case of Medikenduri and others (Supra), it was held that in order to validate a sale of ancestral land by the father, the benefit need not be purely of a defensive or protective character. To hold so should be to miss the significance of the expression "benefit to the estate". If the transaction is not speculative or risky one but is beneficial or advantageous from the financial point of view and is calculated to confer a benefit on the estate, the sale must be held to be valid and binding on the members of the estate. Whether a particular transaction is beneficial to the state or not, varies according to the circumstances of that case. In the case of Dasari Jayachandra Prasad and others (Supra), it was held that if the manager sells properties in order to migrate to another place and purchase lands there which are more productive, the sales are for the benefit of the family.

In the case of Siri Kishan and others (Supra), it was held that the vendor is not to show whether the sale proceeds had been utilized for the welfare of Hindu Undivided family because even a sale deed executed for discharging the debts of the Karta, is also a valid sale. However, in that case, the sale deed was challenged after 10 years and it was observed that it is only a ploy to recover the land after the prices have gone up. Similarly, in the case of Gangadharan (Supra), the Supreme Court has held that sale challenged after a long delay should not be accepted. In the case of Murarka Properties (P) Ltd. and another (Supra), it was observed that as to what is benefit of the estate there was conflict of opinion. One view was that a transaction cannot be said to be for the benefit of an estate unless it is of defensive character calculated to protect the estate, from some threatened danger or destruction. Another view was that for a transaction to be for the benefit of the estate it is sufficient if it is such as a prudent owner, or rather a trustee, would have carried out with the knowledge that was available to him at the time of transaction. The question whether it is for the benefit of family would depend upon the facts of the case.

In the case of Sunder Das and others (Supra) on which heavy reliance has been placed by learned counsel for the appellant, the facts were that father of the plaintiff, in that case, at the time of executing the sale deed was working as Upper Division Clerk in the Civil Court at Chhatarpur. His monthly income was Rs. 150/- in 1958-59 when the sale deed was executed. He clearly recited in the impugned sale deed in favour of the contesting defendants that he was selling the suit house for Rs. 1800/- on account of family necessity. It was observed that the vendor in that case was well versed in the ways of the world and was not a novice or a layman. He disposed of the suit house which appeared to be almost a ruin. In the case of Gurnam Singh and others (supra), the question of law framed was that whether the judgment and decree holding that the sale by the vendors was not for the legal necessity, was the outcome of misreading of pleadings and evidence and settled law on the point. In the said case, it was alleged that sale deed was executed because vendor wanted to purchase other land, they were residing at Ludhiana and Delhi and one of the plaintiffs was an Advocate and major at the time of sale, who did not choose to challenge the same for about 12 years as the suit was filed just before the expiry of limitation. There was no allegation against the vendor that he was a man of bad character, spendthrift etc. Thus the Court while discussing various precedents of the Supreme Court and the High Courts allowed the appeal setting aside the judgment and decree of both the Courts below.

In the present case as well, no evidence has been led by the plaintiff that defendant No. 2 was a man of bad character or was of a spendthrift. It has been established on record that the sale consideration was not inadequate because the sale deed has already been tested by defendant No. 2 in another litigation of which the judgment and decree is already on record as Ex. PW 4/C and PW 4/D. It has also come in evidence that the plaintiff was residing with his father/defendant No. 2 at Chandigarh and the property in dispute over which there was a dilapidated house was in abadi of the village. Defendant No. 2 was a Class-I Officer of Punjab Government, retired as Under Secretary, recited in the sale deed that he required money for his household expenses. There was no intention on the part of the plaintiff and defendant No. 2 to reside permanently at village Kot Fatta as they had already disposed of other property situated in that village. The only thing which has been taken against defendant No. 1 by the Courts below is that since defendant No. 2 raised loan for the purpose of constructing a godown, the sale of the property in dispute would not be a contributory factor in that project and was not an act of good management.

In the case of Sunder Das and others (Supra), the vendor was working as Upper Division Clerk in the Court and the Supreme Court has held that he was not a novice to know about his rights and had acted as a prudent man in disposing of the property in dispute involved in that case. Thus, in my considered opinion, in a case where there is evidence against the ''karta''/vendor of being a spendthrift or suffering from any vices unapproved by the society and the sale deed is speculative or fraught with risks or involves a possibility of loss to the family, then such a sale deed cannot be considered to be an act of a good management, but once the vendor is not suffering form any vices and is a prudent man, well versed with the worldly ways, does not want to stay at the place where the property is being sold or has migrated from that place permanently and the sale consideration has not been found to be inadequate by court of law, then such sale cannot be termed to be an act of bad management or without any legal necessity in order to be challenged by other coparceners. In these circumstances, the question of law posed in the beginning of the judgment is answered in favour of defendant No. 1/appellant and consequently, the judgment and decree of both the Courts below are hereby set aside and the suit of the plaintiff is dismissed with costs.