S. Ramabadran and another vs Ramaswamy alias S.R. Swamy

Ramaswami, J.—This Second appeal is preferred against the decree and judgment of the learned District Judge of West Tanjore in A.S. No. 127 of 1956, confirming the decree and judgment of learned Subordinate Judge of Kumbakonam in O.S. No. 27 of 1955. The plaintiff S. Ramaswami alias S.R. Swami is a reversioner to the estate of the deceased N.R.R. Ayyangar. He filed the suit, out of which this second appeal arises, for recovery of possession of a parcel of immovable properties belonging to the estate of N.R.R. Ayyangar with mesne profits.

The facts leading to the institution of the suit are: One N.R. Rangaswami Ayyangar was the village Headman of Naduvakarai. His emoluments at the time of his death would not have exceeded Rs. 20 per month. It has been established by over-whelming evidence that he was chronically indebted and that he had been executing promissory notes for petty amounts and that they remained unpaid for several years. Ex, B-16, for instance, is a promissory note for a sum of Rs. 100 executed by N.R. R. Ayyangar which remained undercharged on 10th January 1934. Similarly, Exs. B-18 to B-26 are promissory notes for petty amounts executed from 1918 to 1933 which also remained undercharged. That is not surprising because by the time this N.R.R. Ayyangar died in 1933 agricultural produce was selling at abnormally low price in this State. It is a notorious fact, of which we can take judicial notice, that the price of paddy was roughly about one-tenth of its present price. In those days a kalam of 24 Madras measures was selling at Re. 1 whereas it now sells at Rs. 10 and more. On account of these abnormal low prices and the increased indebtedness of the agriculturist sweeping expropriator measures were passed in the State to rehabilitate agriculturists, like the Madras Agriculturists'' Relief Act IV of 1938, and Debt Conciliation Boards etc., were set up. In fact the agriculturists were in the doldrums. It is not surprising therefore that N.R.R. Ayyangar who owned Ac. 4-79 cents of wet lands and Ac 2-92 1/2 cents of dry lands and a family house was unable to discharge even his petty debts. It was in this state that he died in August 1933 surviving him only his widow Ponnammal.

This Ponnammal on 21st December 1933 executed a usufructuary mortgage of all the properties of N.R.R. Ayyangar in favour of D.S. Ayyangar. It is nowhere stated that there was any collusion between this D.S. Ayyangar and Ponnammal. In fact, as I shall show later, none of the reversioners came to the help of this unfortunate widow and she had no choice but to usufructuaries mortgage all the properties. The said mortgage Ex. B-2 was for a sum of Rs. 3000. Out of this a sum of Rs. 1360 was directed to be paid towards the discharge of several debts left by N.R.R. Ayyangar. They have been catalogued in the deed. Those debts are covered by Exs. B-4 to B-11, B-16 and B-18 to B-20. Ex. B-4 was a mortgage executed by N.R.R. Ayyangar in favour of the Co-operative Land Mortgage Bank, Kumbakonam, for Rs. 1000. This debt came to Rs. 1059-11-10 by the time Ex. B-2 came to be executed. In addition, Ex. B-17 dated 25th August 1933 was a promissory note executed by Ponnammal in favour of Murugayya Moopanar for Rs. 600 for meeting the funeral expenses of her husband. The learned Subordinate Judge found that this amount had been so spent. Ex, B-11 is a promissory note executed by Ponnammal on 11th September 1933 to meet the expenses of the monthly ceremonies (Masyams) of her husband.

Thus, the usufructuary mortgage Ex. B-2 is found to be fully supported by, consideration viz., towards the discharge of the debts left by N.R. R. Ayyangar and for meeting the expenses of the funeral obsequies and Masyams of N.R.R. Ayyangar, which are held to be necessary expenditure and for which the learned Subordinate Judge relied on the decision in Sardar Singh v. Kunj Behari Lal ILR 44 All. 503. To sum up, the conclusion of the learned Subordinate judge in regard to Ex. B-2 was that N.R.R. Ayyangar died indebted and that his promissory note debts and mortgage debt had to be discharged by his widow Ponnammal and that Ponnammal on account of the low value of paddy in the early thirties was forced to borrow and perform the essential and obligatory funeral and other ceremonies of her husband and that consideration had passed as recited in Ex. B-2. He concluded:

In the result I hold that N.R.R. Ayyangar did leave debts, that the widow borrowed for necessaries and that the alienation under Ex, B-2 is fully supported by consideration as recited therein and that it cannot be held that the alienation was not for necessaries or that they are bogus.

The learned District Judge did not disturb this finding. He observed:

The learned Subordinate Judge has found in paragraph 10 of his judgment that Ex. B-2 is fully supported by consideration and that the alienation evidenced by it was for necessity. No memorandum of cross-objections is filed against that.

Therefore, it may be taken as established that Ex. B-2 was fully supported by consideration and was executed for purposes binding upon the estate of N.R.R. Ayyangar.

This usufructuary mortgage of 1933 was followed up by the sale deed Ex. B-3 of 1942. It is in evidence from the notices exchanged between the then immediate reversioner and D.S. Ayyangar Exs. A-9 to A-12 in 1942 that the reversioner did not come to the help of the widow. She had to go and live in her parents village with some strangers. Fortunately she was not thrown on the streets on account of the fact that she had some jewels and which she had converted into cash. So partly by the philanthropy of her relatives on her mother''s side and partly on account of the little money which she had by the sale of her jewellery, she has been eking out her existence without any support from her reversioners. These facts are deductible not only From the notices referred to above but also from the will of this Ponnammal Ex. A-7 dated 23rd June 1952 giving the little she had to a nephew who was looking after her. Ponnammal died in 1954.

Ex. B-3 is a sale deed for Rs. 3350 in favour of D.S. Ayyangar. The sale is in respect of a portion of the properties covered by Ex. B-2. The total extent Bold under Ex. B-3 is Ac. 6-57 1/2 cents of wet and dry lands while under Ex- B-2 the extent of property mortgaged is Ac. 7-7 1/2cents The house which was included in the usufructuary mortgage is excluded under the sale deed. Gut of the sum of Rs. 3350 Rs. 2500 went in discharge of Ex. B-2 executed in favour of the vendee. A sum of Rs. 350 over and above this sum of RS. 2500 had been taken by Ponnammal in cash towards the expenses incurred for her medical treatment and discharge of sundry debts. The balance of Rs. 500 was reserved with the vendee as a deposit on which, towards the maintenance expenses of Ponnammal and for meeting the expenses of the annual ceremony of Ponnammal''s husband, the vendee has to pay interest at eight annas per cent mensem. On the death of Ponnammal this sum of Rs. 500 was to be paid to her heirs viz., reversioners. There is no dispute that subsequent to this sale the vendee has been in possession and enjoyment of the properties.

It is in these circumstances that the suit had been filed by the reversioner for setting aside the said sale. The learned Subordinate Judge who found that Ex. B-2 was fully supported by consideration and that the cash of Rs. 350 was also paid to Ponnammal, came to the conclusion that there was no necessity to sell the entire estate and that at best BO much portion of the estate as was necessary to pay off the debts should have been disposed of and that the value of the properties should at that time be approximately fixed at Rs. 7000 and that therefore the transaction was unconscionable and that it should be set aside. But the learned Subordinate Judge further found that the only entity to which the vendee would be entitled to was to get back the amount paid under Ex. B-3 viz., RS. 3350 and hand over possession of the properties to the plaintiff deducting of course the sum of Rs. 500 which under the terms of the sale deed itself should go to the reversioner. The learned District Judge confirmed these findings holding however that the value of the properties at the time of Ex. B-3 can be estimated only at Rs. 4846-8-0.

On these findings of fact of both the Courts and which are binding on me, there cannot be the slightest doubt that both the Courts below significantly failed to apply the correct principles of Hindu Law.

The learned Advocates Mr. N.R. Raghavachariar himself the author of a well-known treatise on Hindu Law Principles and Precedents, third Edition (1947, M.L.J. publication) and of which the fourth Edition is long overdue, and Mr. V. C Srikumar his erudite junior drew my attention to the following well settled principles.

The powers of a Hindu widow to alienate the property of her husband and in which she was taking a limited estate till the passing of the Hindu Succession Act are set out in Mulla''s Principles of Hindu Law 11th Edition at p. 183 as follows:

The power of a widow or other limited heir to alienate the estate inherited by her for purposes other than religious or charitable is analogous to that of a manager of an infant''s estate as defined by the Judicial Committee in Hanooman Persaud v. Mussamat Babooee 6 M.I.A. 393, That power is a limited and qualified one; it can only be exercised rightly ''in a case of need or for the benefit of the estates''. But where the alienation is one that a prudent owner would make in order to benefit the estates a Bona Fide alienee is not affected by the previous mis-management of the estate. ''The actual pressure on the estate, the danger to be averted, or the benefit to be conferred upon it, in the particular instance, is the thing to he regard.'' If the alienation is for purposes of legal necessity or for the benefit of the estate, it binds not only her interest in the estate, but the whole body of reversioners.

The touchstone of the authority is necessity. Word ''necessity,'' when used in this connection, has a somewhat special, almost technical meaning. It does not mean actual compulsion, but the kind of pressure which the law recognizes as serious and sufficient. The receipt even of full value for property sold by her, where there is no pressure on the estate, will not justify the sale; otherwise every tram action with a limited heir for full value would be valid.

In a leading case of this High Court, Jagannadhan v. Vigneswarudu 61 M.L.J. 507 = 34 L.W. 551, Mr. Justice Venkatasubba Rao has the following observations to make on the question of necessity:

The sale is not impeached on the ground that it has not been shown that there were circumstances of actual pressure. According to this contention, where money is raised for paying off a binding debt, an alienation can be justified only if actual-pressure is shown in the sense of some pressure from without. For instance, it must be shown that legal proceedings were threatened or a forced sale of the mortgaged property was imminent. In our opinion this is not the correct test of justifying necessity for, a restraint of this kind, far from benefiting or preserving the estate, would lead to the very opposite result. Why should & widow, for instance, be compelled to allow a mortgage debt to grow and swallow up the property mortgaged, when the early paying off of that debt would be beneficial to the estate and tend to its preservation? If the alienation was made in the exercise of a reasonable discretion and could be justified as the act of a prudent manager, the objection that there was no compulsion from without and that the necessity was not imminent should not be allowed to prevail.

The reversioners of a Hindu widow cannot dictate to her as to how she should raise money necessary and that it should be done only by a mortgage and not by sale. Courts have got to see whether there was a necessity to raise money by alienating the properties, and if this necessity is found, it is for the widow to raise the money either by selling or by encumbering the properties. The principle of law is well established that a Hindu widow can alienate her husband''s property for necessity of the estate, that no hard and fast rule can be laid down as to whether a Hindu widow in possession of very little property left by her husband can or cannot sell the same for her future maintenance and that each case has to be decided on its own facts. Generally speaking, there is no obligation upon a Hindu widow to starve herself and keep a small estate for the benefit of the reversioners, living on a meagre income. If the circumstances of the case warrant, it will be perfectly legitimate for her to sell her husband''s properly, if it is very small and does not yield sufficient income, even for her future maintenance: Chockkalingam Pillai v. Pechi Ammal 71 LW 359.

Cases frequently arise" as painted out by Mulla (Ibid) at p. 204, in which property inherited by a widow from her husband is sold by her for legal necessity, but the whole of the price is not proved to have been applied to purposes of necessity, and the sale is challenged by the reversioners on that ground. In such cases, if the sale itself is justified by legal necessity, and the purchaser pays a fair price for the property sold, and acts in good faith and after due inquiry as to the necessity for the sale, the mere fact that part of the price is not proved to have been applied to purposes of necessity would not invalidate the sale the purchaser not being bound to see to the application of the price. If the above conditions are satisfied, the sale must be upheld unconditionally, whether the part not proved to have been applied to purposes of legal necessity it considerable or small.

AIR 1927 244 (Privy Council) - price Rs. 19,000/- Rs. 1,622 not proved to have been applied to purposes of necessity-the sale upheld unconditionally following Krishna Das v. Nathu Ram 54 I.A. 79, a case of sale by manager - price Rs. 3,500- Rs. 500 not proved to have been applied to purposes of necessity-sale upheld unconditionally; Ram Gopal Ghose v. Bullodes Bose (1864) W.R. (Sp.No.) 385 one third of the price not proved to have beep applied to purposes of necessity- Sale upheld unconditionally; Luchmeedhur Singh v. Ekbal Ali 8 W.R. 75 price Rs. 65,000/- Rs. 14,000/- not proved to have been applied etc. sale upheld unconditionally; Chatranarayan v. Uba Kunwari 5 Beng. L.R. 201 price Rs. 995/-Ra. 321 not proved to have been applied etc. sale upheld unconditionally; Kamikaprasad v. Srimatt 5 Beng. L.R. 508 -sale upheld unconditionally; Felaram Roy and Others Vs. Bagalanand Banerjee, Permanent lease on a selami of Rs. 125--Rs. 25/- not proved to have been applied, etc., lease upheld unconditionally; AIR 1922 307 (Privy Council) not proved to have been applied etc.- sale upheld unconditionally; Naman Lal v. Har Bhagwan 2 Lah. 357 sale upheld unconditionally; Bal Krishna v. Hira Lal 41 All. 338 price Rs. 19,500-Rs. 11,725 not proved to have been applied etc., sale upheld unconditionally.

The equities which may arise on the setting aside the alienation by a Hindu widow have undergone transformation. The law prior to the leading case on the subject Krishna Das v. Nathu Ram 8 W.R. 75 as held by the Allahabad High Court was (1) that if the portion of the price not proved to have been applied to purposes of legal necessity was considerable, the Court should pass a conditional decree setting aside the sale on payment by the plaintiffs (that is, the coparceners challenging the sale) to the purchaser of the sum which was found to have been applied for purposes of necessity;

(2) that if such portion was small, the Court should pass a conditional decree upholding the sale on repayment by the purchaser of such portion; and (3) that if such portion was a trifling sum, the Court should uphold the sale without imposing any condition upon the purchaser. These decisions were disapproved by the Judicial Committee in an appeal from Allahabad, and it was held that a sale of joint family property should not be set aside merely because a considerable part of the purchase money is not proved to have been applied to purposes of legal necessity. The real question to be considered is whether the sale itself was justified by legal necessity; if the purchaser has acted honestly and made due inquiry as to the existence of necessity for the sale, he is not bound to account for the application of the price. If the above conditions are fulfilled the sale must be upheld. It was alto held that on the same principle a decree upholding a sale conditionally upon the purchaser paying a small part of the price not proved to have been applied to purposes of necessity is also contrary to law; the sale must be upheld unconditionally.

On the foot of these principles alienations by the widows were upheld in the following decisions: Govind Singh v. Baldeo Singh 25 All. 330-sale by widow - price Rs. 3,299-Rs. 375 not proved to have been applied to purposes of necessity; Ham Devi v. Abu Jafar 27 All. 494-sale by widow-price Rs.2,995-Rs. 445 not proved etc; Dwarka Ram v. Jhulai 45 All. 429- price Rs. 600-Rs. 200 not proved etc., Daulat v. Shankata 47 All. 355-price Rs. 2,142-Rs. 105 not proved to have been applied to purposes of necessity; Lal Bahadur v. Kamleshar 48 All. 183 -price Rs. 5.995-Rs. 259 not proved to have been applied to purposes of necessity.

In this connection two other things should also be borne in mind. First of all, in estimating the market value by taking into consideration sales of lands of similar description in the vicinity at about that time, we have got to remember that there is nothing secret or mysterious about the value of land. It is a commodity commonly dealt in and like every other commodity it has a price which can be ascertained within certain limits. This price, however, constantly varies according to the variations of the supply and demand and it is impossible, to 6x it at any given time with mathematical accuracy Valuation of immovable property is not an exact science. A determination of the value is any enquiry relating to a subject abounding in uncertainties, where, there is more than ordinary guess work and where it would be very unfair to require an exact exposition of reasons for the conclusions arrived at. It is not an algebraic problem which would be solved by an abstract formula. Averages are often a fallacious test in arriving at valuation. It is true that the best evidence to prove that what a willing purchaser would have paid for the land under consideration, would be evidence of genuine sales effected about the time of the alienation under consideration. But, in taking into consideration the sales of neighbouring lands it has to be observed that this method of determining the market-value is subject to this difficulty viz., that no two pieces of land can be precisely similar in all their circumstances and conditions. There must always be differences though of varying degrees and no hard and fast rule can be laid down as to the allowances to be made for such differences. In this case there is the added difficulty that the sales of neighbouring lands taken into consideration by the Courts below were of willing buyers and willing sellers and by unlimited owners. The lands under alienation had been sold to a usufructuary mortgagee and the mortgagee has always got the whip hand over the mortgagor and a fair market price would not be fetched. In addition, the alienation was by a limited owner. It is well-known that sales by limited owners fetch at the best only inadequate prices because the purchasers make provision for the almost certain trouble they will have to meet at the hands of the reversioners and that too practically at an uncertain future date. A sale by a Hindu widow cannot be treated as a fair basis for calculating market value in as much as lull value is never realised at such transactions per Nitayan and S. of S. 57 I.0.734. One of the reasons why the Hindu Succession Act abolishing limited estate has been enacted is the notorious difficulties of limited owners securing lair prices for their The Assistant Development Officer Vs. Tayaballi Allibhoy Bohori, , S. of S. v. Charlesworth ILR 26 Bom. 1 P.C. Secretary of State Vs. Altaf Hossein, S. of S. v. Amulycharan Banerjee AIR 1927 Cal. 274, Collector of Dacca v. Golan AIR 1926 Cal. 688, AIR 1925 211 (Privy Council) ImptTrost Bombay v. Kartandas 33 Bom 28., Hemchandra v. S. of S. 56 D.C. 758, Khusiram v. Asst. Collector Shekarpur AIR 1925 Sind 112, AIR 1925 292 (Nagpur) , Ismailji Mahomedalli Bohori Vs. The District Deputy Collector, , and Nitayanand v. S. of S. 57 I.O. 734.

The second point to be taken into consideration is that whereas a limited owner can borrow on a mortgage the precise amount required for a necessary purpose, it is not always possible for such alienor to sell just that share of the family property which would bring in the precise sum which is wanted to clear the debts which are binding. It is on that principle that in the following decisions even though portion of the sale price was found to be in excess of the requirements of the alienor at the time of sale, the sales were upheld: Niamatrai v. Din Dayal (1927) 54 I.A. 211. (Rs. 5100 out of Rs. 43,500 not for necessity- sale upheld) Gowrishankar v Jiwan Singh (1927) 53 M.L.J. 786 = 27 L W. 203 (P.C.), Rs. 500 out of Rs. 4000 not proved-sale upheld; AIR 1927 244 (Privy Council) Rs. 2000 out of Rs. 19000 not proved-sale upheld; Murbi v. Ghammar (1929) 51 All. 61, Rs. 433 out of Rs. 1400 not proved; AIR 1929 143 (Privy Council) out of Rs. 10767 not proved-sale upheld; Shyamlal v. Bhadri Prasad (1929)51 All. 1039. Rs. 475 out of Rs. 1000 not proved-sale upheld; Atchuanand v. Suraj. narain (l926) 5 Pat. 476 Rs. 200 out of Rs. 750 not proved-sale upheld; Bitendra v. Sukdev (1929) 8 Pat, 558, Rs. 637 out of Rs. 6400 not proved sale upheld; Hirendra Nath v. Shebaran A.I.R 1952 Cal.473, and Mangala Mehar v. Sutra Moher ILR 1950 Cuttack 107 = A.I.R.

Bearing these principles in mind, we shall now examine the grounds of law on which the Courts below have not upheld the alienation and directed the return of Rs. 3350 to the alienee.

Both Courts went completely wrong on the facts of this case in holding that the widow had no legal necessity for the sale transaction. It is unnecessary to re-set the facts narrated above beyond recapitulating that the deceased N.R.R. Ayyangar left secured and unsecured debts to the extent of Rs. 3000 and that in addition the widow had to incur expenses for performing the funeral obsequies and the Masyams of her deceased husband. Thirdly, between 1933 and 1952 she had incurred expenses towards her medical treatment and had also contracted petty sundry debts. That the amount of Rs. 3350 was paid by the vendee to the vendor is made clear by both the Courts directing the return of Rs. 3350 to the alienee. The purposes for which the considerations went were for binding necessities. Therefore, the lower Court ought to have held that the sale deed was not only fully supported by consideration but also was for legal necessity.

The lower Courts were unduly oppressed by the fact that there was no evidence of the pressure of the creditor D.S. Ayyangar. Beyond the fact that in 1942 the mortgagee would have been insisting upon the discharge of the usufructuary mortgage of 1933 especially as the mortgagor was growing old and infirm requiring medical treatment, the principle which the lower Court should have applied was not pressure but whether the alienor was prudent, which is the ratio of the decision of this Court set out above. That Ponnammal was prudent is evidenced by two facts. First of all, under the sale she has salvaged the house and nearly 1 1/2 acres of land. Secondly, she has reserved Rs. 500 with the alienee, a nice next egg, which would be given to the reversioner and in regard to which she had provided that the interest thereon alone should be paid to her for the performance of ceremonies etc. of her husband. In other words, this was the conduct of a prudent limited owner and consequently the sale is not vitiated, as as concluded by the Courts below, by reason of absence of positive evidence that there was any pressure of the creditor to sell the properties.

The learned Subordinate Judge seems to have been oppressed by the fact that Ponnammal should not have Bold the entire properties but should have sold less than what she has sold. I have already mentioned how Ponnammal had salvaged the family house and nearly 1 1/2 acres of land and another sum of Rs. 500. It also stands to common sense that an alienor cannot, as pointed out above, sell an exact portion of the property equivalent to the exact requirements at that time. A buyer will insist upon a parcel of property by itself self-sufficient in the matter of irrigation facilities etc., being sold. Immovable properties cannot be sold like groceries giving and cutting off exact weight for the exact amount. Therefore, this ground is without any substance.

Adequacy of price seems to have weighed very much with both the Courts below. I have already set out how fallacious the method of valuing immovable properties is by taking into consideration the sales of lands in the neighbourhood. I have also pointed out how this was not a case of a willing buyer and a willing seller but of a limited owner mortgagor selling to a mortgagee. The sale could not be effected by Ponnammal from a position of strength and even the valuations by the Courts below vary so much between Rs. 7000 of the learned subordinate Judge and Rs. 4846-8-0 of the learned District judge, that it is impossible to say that the lands were worth far more and consequently fetched a totally inadequate price. In this connection we have to bear in mind that there is not a whisper of any collusion between the alienor and the alienee. In fact the notices exchanged between the alienee and the then next reversioner show the contrary.

The net result of this analysis is that the sale was justified by legal necessity and the purchaser had paid a fair price for the properties sold and bad acted in good faith and every part of the purchase price had been applied for purposes of necessity.

On these conclusions the sale has got to be upheld and the question of equities will not arise and only a sum of Rs. 500 due under the sale deed to the reversioners will have to be directed to be returned to them.

But fortunately in this case the appellants have been well advised to make the offer that they would not only return the sum of Rs. 500 but also the difference between Rs. 4845 and Rs. 3350. This is apparently due to the fact that on account of the rise in land values, they can afford to be generous and secondly that the parties are related and live in the same locality and obviously the appellants do not want the local public obloquy that reversioners have been done out of a valuable piece of property, whatever the legal justification there may be. Therefore, the decrees and judgments of the lower Courts are set aside and the appellants are directed to pay the plaintiff the sum of Rs. 4846 minus Rs. 3350 plus Rs. 500 with interest on the former amount at six per cent per annum, from this date and on the latter amount at six per cent per annum from the date of suit. In view of the generous attitude adopted by the appellants, the parties will bear their own costs throughout. If costs have been collected they will not be refunded.