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Judgment
103 paragraphs · 13,860 wordsHarries, C.J.—This is an appeal by defendants 10 and 14 from a decree passed by the learned Subordinate Judge of Daltongunj in a mortgage suit. The suit was brought to enforce a mortgage dated 6th November 1923, executed by Gopal Bux Rai (defendant 1), Jageshwar Bux Rai (defendant 2) and Bindeshwari Bux Rai (defendant 3) to secure an advance of Rs. 4000 bearing interest at the rate of Rs. 2 per cent, per mensem compoundable annually. The property mortgaged was 16 annas of village Imli in the District of Palamau. The appellants (defendants 10 to 14) were impleaded in the suit as subsequent transferees of portions of the mortgaged property, whereas defendants 5 to 9 were impleaded as sons and grandsons of the executants. To understand the facts of this case, it is necessary to give a genealogical table showing the relationship of the defendants who were interested in village Imli:
SHEO BUX RAI | ______________________________________ | | Ram Bux Rai Rajmohan Bux Rai | | Har Bux Rai Fateh Bux Rai | | Kishun Bux Rai ___________________ | | Surendra Bux Rai | | ______________________________________________________________________ | | | | Biseswar Bux Rai Bameshwar Bux Rai Jugeshwar Rai Narain Bux Rai | | (Deft. 2) | Gopal Bux Rai Bindeshwari Bux Rai | Mt. Jagannath Kuar (Deft. 1) (Deft. 3) | (Deft. 4) ______________________| |_________________________ | | | | Anant Bux Rai Tapo Bux Rai Maharaj Bux Rai Tipu Bux Rai (Deft. 9) (Deft. 9a) (Deft. 5) (Deft. 6) | Gangeshwar Bux (Deft. 7)
The family, as will be seen, were descended from Sheo Bux Rai who was the owner of the Deogan estate which was an impartible estate governed by the rule of primogeniture. That estate in due course came to Ram Bux Rai and thereafter to Har Bux Rai, Kishun Bux Rai and then to Surendra Bux Rai. The junior branch of the family represented byBajmohan Bux Rai was excluded from the Deogan Estate by the rule of primogeniture; but Kishun Bux Rai when he held the Deogan estate made a khorposh grant of a number of villages including the village of Imli to Pateh Bux Rai. On the latter''s death these villages became the property of his four sons, Biseswar Bux Bai-, Eame-shwar Bux Rai, Jageshwar Bux Rai and Narsin Bux Rai.
It appears that in the year 1904, these four brothers were in financial difficulties and applied for protection under the provisions of the Chota Nagpur Encumbered Estates Act (6 of 1876). Their application was acceded to and the estate was put under the management contemplated by that Act. The estate remained under such protection until 20th April 1923, when by a notification of that date the estate, which was known as the Imli Encumbered Estate, was released from the operation of the Encumbered Estates Act. In the meantime, Biseswar, Bameshwar and Narain Bux Rai had died. The estate was released to Gopal Bux Rai c (defendant 1), Jageshwar Bux Rai (defendant 2) and Bindeshwari Bux Rai (defendant 3) and Mt. Jagannath Kuar, the widow of Narain Bux Rai who was originally impleaded in this suit as defendant 4. During the pendency of the suit, however, she died, and her name was struck out from the array of parties. These four persons were described in the notification of the release of the estate as the then proprietors of the Imli estate.
Surendra Bux Rai, who had inherited the Deogan estate according to the rule of primogeniture, died apparently without issue, and Gopal Bux Rai who represented the senior branch of the family of Fateh Bux Rai claimed the estate. Apart from direct issue of Surendra Bux Rai, Gopal Bux Rai was clearly entitled to this estate. It was, however, alleged that a posthumous child to Surendra Bux Rai had been born who was entitled to succeed to the Deogan 3 estate. The widow of Surendra Bux Rai remained in possession of the estate on behalf of this minor, and Gopal Bux Rai was compelled to institute proceedings for the recovery of the estate. It is to be observed that his claim failed in the Court of the Subordinate Judge; but on appeal this Court by a majority held he was entitled to the Deogan estate. This decision was recently affirmed by their Lordships of the Privy Council.
As Gopal Bux Rai had to embark on this litigation, he found it necessary to borrow money upon the security of his interest in the Imli estate, which, as I have said, had been released from the protection under the Chota Nagpur Encumbered Estates Act on 20th April 1923. Having in mind the provisions of Section 12A, Chota Nagpur Encumbered Estates Act, Gopal Bux Rai applied to the Deputy Commissioner of Palamau on 13th October 1923, for permission to raise a loan for Rs. 10,000, presumably by mortgaging Imli estate, though this is not stated in his application which is printed at p. 2 of Part III of the paper book. The application is merely for permission to raise Rs. 10,000, and it is to be observed that the dooument is signed by Jageshwar Bux Rai as mukhtaram for Gopal Bux Rai. The application, however, is made by Gopal Bux Rai and not by Jageshwar. On 1st November 1923, the Deputy Commissioner of Palamau forwarded to the Commissioner of Chota Nagpur the application made by Gopal Bux Rai with the recommendation that Gopal Bux Rai should be permitted to raise a loan of Rs. 4000 on the security of his property. On 6th November 1923, the mortgage bond in suit was executed by Gopal Bux Rai, Jageshwar Bux Bai and Biseswar Bux Rai to secure an advance of Rs. 4000 made by Jodha Sahu, father of plaintiffs 1, 2 and 3. On 22nd November 1923, the Commissioner of Chota Nagpur inquired from the Deputy Commissioner of Palamau whether the other persons interested in the Imli estate had any objection to Gopal Bux Rai raising a loan on the security of his property and whether, the property had been partitioned. The Commissioner also desired to'' know from whom it was proposed to take the loan. On 1st February 1924, the Deputy Commissioner replied to the Commissioner stating that Jageshwar Bux Rai and the other proprietors of the Imli estate had no objection to Gopal Bux Rai raising a loan and further that the proprietors of the estate had in fact borrowed the money from Jodha Sahu agreeing to pay interest at the rate of two per cent, per mensem. The Commissioner was also informed that the property had not been partitioned. On 13th February 1924, the Commissioner by an order of that date permitted Gopal Bux Rai to raise a loan of Rs. 4000 on the security of his property. It is to be observed that when the loan was taken and the mortgage executed no permission had been obtained from the Commissioner of Chota Nagpur. His sanction was given nearly three months after the loan had been taken and the mortgage executed.
The form of the application of Gopal Bux Bai and the form of the sanction given by the Commissioner suggest that Gopal Bux Rai''s interest only in the property was to be mortgaged. The correspondence passing between the Deputy Commissioner and the Commissioner, however, suggests that what the parties and the authorities had in mind was a mortgage of the Imli estate. The Comissioner before giving sanction was expressly informed that the co-proprietors of Gopal Bux Rai had no objection to the loan being raised and that the property had not been partitioned. Throughout this case, it has been assumed that sanction to mortgage the Imli estate or a portion thereof was asked and granted and not merely permission to mortgage the interest of Gopal Bux Rai only whatever that interest might amount to.
Separate written statements were filed by defendants 1,3 and.4 and by defendant 2 for himself and as guardian of minor defendants 7, 8, 9 and 9 (a) and by defendant 10, defendants 11 to 13 and defendant 14. A large number of defences were raised, but for the purposes of this appeal it is only necessary to refer to two main defences.
It was pleaded by all the contesting defendants that the mortgage sued upon was void by reason of the fact that the previous sanction of the Commissioner for mortgaging the property had not been obtained in accordance with the provisions of Section 12A, Chota Nagpur Ehcumbered Estates Act. It was also pleaded by the minor defendants that the mortgage was void for want of legal necessity.
The learned Subordinate Judge who tried the case was of opinion that the sanction given by the Commissioner was sufficient to satisfy the provisions of Section 12A, Chota Nagpur Encumbered Estates Act, and, therefore, the mortgage could not be impugned on that ground. He was further of opinion that the mortgage was for legal necessity and in the result decreed the suit after reducing the rate of interest from two per cent, per mensem compound to one per cent, per mensem simple. It is to be observed that any claim ''for a money decree was clearly barred by limitation as the suit was instituted well after six years from the due date of payment mentioned in the mortgage.
The plaintiffs in their plaint alleged that Gopal Bux Rai (defendant 1) had become in law the karta of the joint family when he became entitled to the Deogan estate and the plaint recognizes that the property mortgaged was joint family property belonging to the descendants of Fateh Bux Rai. It was, however, suggested in argument before us that the Imli estate was not joint family property but had descended to the four sons of Fateh Bux Rai as tenants-in-common. If such was the case, the mortgage was not of joint property but of definite divided shares held by each of the executants in the property. The property was made the subject of a khorposh grant to Fateh Bux Rai, and there can be no doubt that in his hands the property must be regarded as self-acquired property. Mr. B.C. De, f who appeared on behalf of the appellants argued that as the property was self-acquired in the hands of the father the sons acquired no interest in it by birth as they would have done if the property had descended to Fateh Bux Rai from his father Sheo Bux Rai. Mr. De''s contention was that the sons first acquired an interest in the property by inheritance and that being so they took the property as tenants-in-common and not jointly. Reliance was placed upon the case in AIR 1937 233 (Privy Council) , in which their Lordships of the Privy Council laid down that the rule of Hindu law is well settled that property which a man inherits from any of his three immediate paternal ancestors, namely his father, father''s father and father''s father''s father, is ancestral property as regards his male issue, and his son acquires jointly with him an interest in it by birth. Such property is held by him in coparcenary with his male issue, and the doctrine of survivorship applies to it. Their Lordships further laid down that ''though the word "ancestor" in its ordinary meaning including an ascendant in the maternal, as well as the paternal line, yet the "ancestral estate" in which, under the Hindu law, a son acquires jointly with his father an interest by birth, must be confined to the property descending to the father from his male ancestor in the male line. The estate, inherited by a person from his maternal grandfather, cannot be held to be ancestral property in which his son has an interest jointly with him and such person has full power of disposal over that estate and consequently a devise made by him in favour of his daughter in law cannot be challenged by his son or any other person.
In my view, this case does not establish that where a father, who is a member of a joint family with his sons leaves self-acquired property, such property comes into the hands of his sons as tenants-in-common. The rule of Hindu law is, in my view, clear, and that is that self-acquired property of the father is taken by sons who formed a joint family with the father as joint family property and is not taken by them as tenants-in-common. The rule is stated in para. 271, Mayne on Hindu Law and Usage, 10th Edn., in these words:
It follows from the conception of unobstructed heritage (apratibandhadaya) and of the son''s right vested by birth that an undivided son takes not only the paternal grandfather''s property but also the property acquired by his father, not strictly by inheritance but by virtue of his right by birth and only as unobstructed heritage (apratibandhadaya)." For, there are only two divisions of inheritance, obstructed and unobstructed. The male issue do not succeed by inheritance to unobstructed property; and the texts relating to obstructed heritage do not refer to sons but only regulate succession to the property of a man who dies sonless. The Mitakshara and the other authorities following it are quite explicit on the matter. The very definition of unobstructed heritage makes no distinction between the property of the father and the property of the grandfather so far as the son''s right to take it as unobstructed heritage is concerned. That the right vested by birth in the son extends to property acquired by the father is unequivocally stated in the Mitakshara (I, 1, 23-27, 33), "Therefore it is a settled point that property in the paternal or the grand-paternal estate is by birth." The distinction between the son''s equal right by birth in the grand father''s property and his unequal right by birth in the father''s property is fully brought out by Vijnanesvara in I, v,5,9 and 10. He states: "Consequently the difference is this : although he has a right by birth in his father''s and his grandfather''s property ; still, since he is dependent on his father in regard to the paternal estate and since the father has a predominant interest as it was acquired by himself, the son must acquiesce in the father''s disposal of his own acquired property; but since both have indiscriminately a right in the grandfather''s estate, the son has a power of interdiction," The Smritichandrika is quite precise and definite on the point. "In the case of father''s property, the ownership of father and son is unequal in the case of grandfather''s property, the ownership and also independent power are both equal in the father and son. Whereas in the case of father''s property, while he is alive and free from defect, he (father) alone possesses an independent power and not the son.
In para. 272 the learned author says:
The result therefore is that'' while the son has a right by birth both in his father''s and in his grandfather''s property, a distinction under a special text makes the right of the son and the father equal in the property of the grandfather. That text is: the ownership of the father and the son is the same in land, a corrody or wealth received from the grandfather." But in the case of father''s property the ownership of the son is unequal, for the father has an independent power over it or a predominant interest. The son''s right by birth does not therefore extent to his enforcing a partition or interdicting an alienation of his father''s property. The right however remains a real birth right, though dormant and enables the son to succeed to the property by survivorship or as apratibandhadaya.
The view stated in Mayne''s Hindu Law was the view of the Calcutta High Court as expressed in Raja Ram Narain Singh v. Pertum Singh (''73) 20 W.R. 189. At p. 191 Phear, J., observes:
The distinction between a joint property and separate property under the Mitakshara law appears to me to be simply of a temporary, not of an abiding, character. Property is joint, when it belongs to all the members, who may be many of a joint family. Property is separate when it belongs only to one member of a joint family alone, and not to the others jointly with him. As long as it is separate and in the condition of self-acquired property, the person who is the holder of it has no one to consult in regard to the disposal of it except himself. But the moment it passes from his hand by descent into the hands of some one in the next generation, it becomes joint family property the property of several persons united together as a joint family with regard to it the property of a new joint family springing from a new root. And it continues to go down by one rule of descent only.
The views expressed by Mayne and by the Calcutta High Court were approved of by their Lordships of the Privy Council in Venkayyamma Garu v. Venkataramanayyama Bahadur Garu (''02) 25 Mad. 678, in which their Lordships held that on the death of a -daughter her sons succeeded to the property as heirs of their grandfather, and there having been no partition between them, they took it as ancestral property which had devolved upon them as members of a united family under the ordinary law of inheritance, viz., jointly with right of survivorship. It is the right to partition which determines the, right to take by survivorship, and where there has been no partition the survivor takes. At p. 687 Lord Lindley, who delivered the opinion of the Board observed:
The High Court have proceeded on the principle that although persons who succeed to joint family property take jointly if their inheritance is unobstructed yet that in cases of obstructed inheritances those who succeed take as tenants-in-common and not as joint tenants. But the authorities referred to by Mr. Mayne in his very able argument show that this last proposition is by no means universally true. Members of a joint family who succeed to self-acquired property take it jointly, Raja Ram Narain Singh v. Pertum Singh 20 W.R. 189 and Rampershad Tewari v. Sheochurn Dos 10 M.I.A. 490, but it may be that where sons succeed the inheritance as to them is unobstructed.
This principle was recently followed by the Bombay High Court in Madivalappa Irappa v. Subbappa Shankerappa AIR 1937 Bom. 458.
It seems to me clear that the four sons of Fateh Bux Rai, who formed a joint family with their father, took the Imli estate on the latter''s death as joint family property, and it was such in their hands at the date of this mortgage. It was not property in which each of the sons had a definite one-fourth share which he could dispose of as he pleased.
As the property mortgaged was joint family property, could it, in the circumstances, be mortgaged without the previous sanction of the Commissioner as required by Section 12A, Chota Nagpur Encumbered Estates Act? That section is as follows:
(1) When the possession and enjoyment of property is restored under the circumstances mentioned in of. (1) or el. (3) of Section 12, to the person who was the holder of such property when the application u/s 2 was made, such person shall not be competent, without the previous sanction of the Commissioner,
(a) to alienate such property, or any part thereof, in any way, or
(b) to create any charge thereon extending beyond his life-time.
* * * *
(3) Every alienation and charge made or attempted in contravention of Sub-section (1) shall be void.
It is common ground that the property was released to the then proprietors of the Imli estate in the circumstances contemplated in Section 12A. It follows therefore that no person who was the holder of the Imli estate when application for protection was made could subsequently alienate or charge the property without the sanction of the Commissioner. It is to be observed however that this incapacity to alienate or charge is confined only to such persons as were the holders of the property at the date of the application. If the mortgage now sued upon was executed by such holders, then the previous sanction of the Commissioner was necessary.
The mortgagors of the mortgage in suit were Gopal Bux Rai, Jageshwar Bux Rai and Bindeshwar Bux Rai. The applicants in 1904 were Biseswar (the father of Gopal Bux Rai), Bameshwar (the father of Bindeshwari Bux Rai), Jageshwar Bux Bai and Narain Bux Rai deceased. It is clear that Jageshwar who executed the mortgage in suit was a holder of this property when application for protection was made in 1904, and this is conceded by. Mr. B.C. De. Gopal Bux Rai and Bindeshwari Bux Rai did not apply for protection; but it is argued by Mr. Dutta that the evidence shows that both were born before the application for protection was made in 1904 and were therefore members of the joint family. As they were members of the family at the date of the application, he contends that they must be regarded as holders of the property at the time the application was made. Mr. Dutta relies upon the case in Rameshwar Dayal Singh v. Ram Das Sahu AIR 1939 Pat. 451 decided by Fazl Ali and Manohar Lall, JJ. In that case it was held that the expression "holder" is used in the Act in the same sense as the expression "holder of land" which occurs in the Preamble to the Act and as such applies to all such person or persons as own any particular property. It is pointed out that there is nothing in the Act to prevent the manager of a joint Hindu family from applying for protection under the Act on behalf of the entire family, and when such an application is made by him in a representative capacity, the whole family and not he alone will be deemed to be the holder of the estate. In other words, in the case of a joint family property the holders contemplated in Section 12A, Chota Nagpur Encumbered Estates Act, are such members of the joint family as were in existence at the date of the application for protection.
Mr. B.C. De on behalf of the respondents how-, ever relied on an earlier case of this Court, namely Supan Sahu v. Tulsi Singh AIR 1932 Pat. 143. decided by Macpherson and Fazl Ali, JJ., in which it was held that the bar imposed by Section 12A(1), Chota Nagpur Encumbered Estates Act, does not come into operation when the proprietor does not fall within the description as being "the person who was the holder of the property when the application u/s 2 was made." In this case the father Jhumak Sahu applied for protection under the provisions of the Act and such protection was granted. It is clear that at the date of the application his two sons were alive and after Jhumak''s death the estate was released in favour of the sons. Subsequently, one of the sons borrowed money and executed a mortgage without the sanction of the Commissioner but the Court held that such sanction was unnecessary.
It is not clear whether the property for which protection was sought in this case was joint family property or not. If it was not joint family property, the case is clearly distinguishable from the later Patna decision to which I have made reference. On the other hand, if the property was joint family property, then the two cases appear to be in conflict. In an appropriate case it may be necessary to refer this point to a Full Bench. However, it is not necessary to discuss the matter further, because even if the view expressed in the later Patna decision, Rameshwar Dayal Singh v. Ram Das Sahu AIR 1939 Pat. 451, be accepted, yet it is not established in this case that either Gopal Bux Rai or Bindeshwari Bux Rai were holders of the estate at the date of the application for protection.
The importance of establishing the existence of Gopal Bux Rai and Bindeshwari Bux Rai at the date of the application for protection in 1904 does not appear to have been realised by the defendants, in this case, and no evidence was called on their behalf to prove the existence or otherwise of these two persons at that date. Two witnesses for the plaintiffs however did give evidence which would suggest that both Gopal Bux Rai and Bindeshwari Bux Rai had been born when application for protection was made; but this evidence is extremely unsatisfactory, and I cannot accept it as sufficient proof that these two persons had been born when application was made. Rameshwar Prasad Sahu (P.W. 3) is plaintiff 1 in the suit and he was called to prove the loan and the fact that Gopal Bux Rai and his uncles were joint. He stated that when the mortgage now sued upon was executed Gopal Bux Rai was 24 or 25 years old. If that be true, then Gopal Bux Rai would have been about five years of age when application for protection was made in 1904. This witness, however, had never been to the defendants'' home and did not know how they lived and how they messed. His actual statement was "I have not seen defendants 1 to 9 how they lived and messed." He does not appear to know the family, and clearly he was trying to remember in 1938 what Gopal Bux Rai looked like in 1923 when the mortgage in suit was executed. Later in cross-examination the witness said that Bindeshwari Bux Rai at the time he gave evidence was about 40 or 45 years of age. If that be so, Bindeshwari was born before 1904; but again the witness is merely saying what he thought Bindeshwari''s age was. He does not appear to know anything about the family.
The only other witness was Mauji Sahu who stated that he had seen Gopal Bux Rai and that he was 24 or 25 years of age when the mortgage in suit was executed. He said he knew Gopal Bux Rai and his brothers but that he did not go to their J village. He did not know if any of them had children or not. He was called to prove attestation of the mortgage deed, and clearly he was trying to remember what Gopal Bux Rai looked like at the date of the execution of the deed.
This is the only evidence on the question of the ages of Gopal Bux Rai and Bindeshwari Bux Rai. The onus was on the defendants to show that they were holders prohibited from alienating or charging the estate without the sanction of the Commissioner, and, in my view, this evidence does not establish that either Gopal Bux Rai or Bindeshwari Bux Rai had been born when application for protection was made in 1904. Therefore, they cannot be regarded as holders of the estate at the date of the application.
It is clear, as I have already stated, that Jageshwar Bux Rai was a holder of the estate prohibited from alienating or charging it without the previous sanction of the Commissioner. The Subordinate Judge, however, was of opinion that the sanction given by the Commissioner after the mortgage was executed was sufficient to validate it even, assuming that the mortgage was not valid when actually executed. It is to be observed that what Section 12A. requires is not merely the sanction of the Commissioner but the previous sanction of that officer. By the express words of the statute, the sanction must precede the alienation or charge. If an alienation or charge is made without such previous sanction by a person not competent to make such alienation or charge then by the terms of Sub-section (3) of the section the alienation or charge is void.
There can be no doubt that if Jageshwar Bux Rai had been the sole mortgagor the mortgage when. executed would have been a void mortgage. But it '' is argued that even if the mortgage was void its invalidity was cured by the sanction given by the Commissioner nearly three months after its execution.
A contract which is void is a nullity, and subsequent ratification by a person who was incompetent to contract cannot validate a void contract entered into by him. Similarly subsequent sanction, unless-expressly provided by the statute, cannot transform what was a nullity into a valid and binding agreement.
A somewhat similar question arose in Mt. Salu Bai v. Bajat Khan AIR 1917 Nag. 215 which was decided by a Pull Bench of the Judicial Commissioner''s Court at Nagpur. By a majority it was held that a transfer made without the Collector''s permission as required by para. 11 of Schedule 3, Civil P.C., is absolutely void. That paragraph of Schedule 3, Civil P.C., is in these terms:
(1) So long as the Collector can exercise or perform in respect of the judgment-debtor''s immovable property, or any part thereof, any of the powers or duties conferred or imposed on him by paras. 1 to 10, the judgment-debtor or his representative in interest shall be incompetent to mortgage, charge, lease or alienate such property or part except with the written permission of the Collector, nor shall any civil Court issue any process against such property or part in execution of a decree for the payment of money.
It is to be observed that this paragraph does not state in terms that a transfer or charge in contravention of the section shall be void as is the case in Sub-section (3) of Section 12A, Chota Nagpur Encumbered Estates Act. Further in this paragraph of Schedule 3 the word "previous" does not appear, and all that is required is the permission of the Collector to alienate or charge. Nevertheless a majority of the Full Bench held that a transaction made in contravention of the provisions of this paragraph of Schedule 3, Civil P.C., was absolutely void. At p. 215 Stanyon A.J.C. expressed the view that any subsequent permission given by the Collector could not validate such a transfer. He observed:
I should like to point out that my brother Mittra has misinterpreted my judgment in Murray v. Murat Singh 3 N.L.R. 171, where he states that in that judgment it is recognized that the subsequent acquiescence of the Collector, whether directly or by implication, would be a sufficient compliance with the statute. In stating the facts of the case I wrote:
It is also an admitted fact that the sanction of the Collector was not obtained, nor is it the allegation, that his acquiescence was subsequently secured, either directly or by implication.
But I indulged in no obiter dicta as to what would have been the legal effect of ratification by the Collector: and, having regard to the view which I took, that the transaction was a nullity, I could not have held that it could have been validated by the Collector''s ratification.
This majority decision of the Full Bench of the Nagpur Court was expressly approved of by their Lordships of the Privy Council in Gaurishankar Balmukund v. Chinnumiya AIR 1918 P.C. 168. In dealing with the question whether a transfer made in contravention of the provisions of para. 11 of Sch.3, Civil P.C., was or was not void, Lord Shaw stated at page 187:
Their Lordships have been referred to authority upon this question. That which is founded on by the appellant particularly is the case in Magniram Vithuram v. Bakubai (''12) 36 Bom. 510. Their Lordships are of opinion that that case was erroneously decided. Upon the contrary, the case in Murray v. Murat Singh 3 N.L.R. 171 referred to in the judgment under appeal, and the case which has been decided recently by the Full Bench of the Central Provinces in Mt. Salu Bai v. Bajat Khan AIR 1917 Nag. 215 are, in the opinion of the Board, proper decision and sound in law.
It is therefore clear that a transfer in contravention of the provisions of para. 11 of Schedule 3, Civil P.C., is absolutely void and cannot be validated by any subsequent sanction. The present case is very much stronger. Here, Section 12A, Chota Nagpur Encumbered Estates Act, requires not only the sanction of the Commissioner but the previous sanction of that officer and sanction subsequently given can never be described as previous. Here there was a clear noncompliance with the plain terms of the statute and once the mortgage was executed without the sanction it became impossible to comply with the statutory requirements. Further, as the mortgage was void when executed, subsequent sanction could not breathe life into a nullity. In law there never was a mortgage, and sanction subsequently given could never bring into effective something which did not exist. It is, therefore, clear that if Jageshwar had been the sole mortgagor this mortgage would have been void. It has been contended, however, that the mortgage is valid, because it was executed not only by Jageshwar who was a disqualified proprietor but by Gopal Bux Rai and Bindeshwari Bux Rai.
In paras. 3 and 4 of the plaint it was pleaded that when Gopal Bux Rai succeeded to the Deogan estate he became in law the manager or karta of the joint family. This was denied in all the written statements, and nothing was cited in the Court below or before us to show that in law Gopal Bux Rai did become karta of the family. Further no evidence was called on behalf of the plaintiffs to prove that Gopal Bux Rai was the karta. The senior member of the family was undoubtedly Jageshwar who would normally have been the karta in the absence of any special or peculiar circumstances. Jageshwar was the only surviving son of Fateh Bux Rai, whereas both Gopal Bux Rai and Bindershwari Bux Rai were grandsons. That Gopal Bux Bai was not taking an active part in the management of the Imli estate appears clear. Even the application for permission to mortgage the property, though made in the name of Gopal Bux Rai who wanted the money to finance his litigation, is actually signed by Jageshwar Bux Rai as his mukhtaram. Further, if Gopal Bux Rai was embarking on litigation to recover the Deogan estate for himself it is not likely that he would undertake the further duties of managing the Imli estate. There is nothing on the record to show that either Gopal or Bindeshwari was manager of the Imli estate but, on the contrary, the probabilities are that Jageshwar Bux Rai was, though this is not proved. Can it, therefore, be said that a mortgage by these two members of the family neither of whom are proved to be kartas or managers is a valid one? If Jageshwar was incompetent to execute a mortgage without the previous sanction of the Commissioner, it is difficult to understand how any one could act for him and execute a valid mortgage. If he was a necessary party, then it appears to me that his incapacity would render the whole document void.
It was, however, argued that the mortgage was valid, because it was executed by two adult members of the family who were not disqualified proprietors. Joint family property can be mortgaged by all the members of the family or by the karta who manages the property and represents each and every one of the members of such family. Family-property, however, cannot be mortgaged by one or two members of a family who are not managers or kartas and who are not authorised to bind the family property. The precise point was considered by a Bench of the Allahabad High Court consisting of Sulaiman and Young, JJ., in Sarju Prasad v. Ramsaran Lal AIR 1931 All. 541. In that case the father who was incompetent to alienate or charge his property by reason of the provisions of para. 11 of Schedule 3, Civil P.C., executed together with his son a mortgage of the family property. It was held that the mortgage was void in spite of the fact that the son did not oome within the provisions of that paragraph. The Bench were of opinion that to allow the son to deal with family property when it had been placed in charge of the Collector would nullify completely the provisions of para. 11 of Schedule 3, Civil P.C. They were of opinion that while the karta as such was prevented from dealing with the property the whole purpose of the enactment would be ''nullified if a mortgage was validated by a junior member joining with the disqualified proprietor. The Court was further of opinion that a junior member of a family could not alienate the family property unless he had in the circumstances of the case become karta. The fact that the son was a party to the mortgage did not render the same valid.
I can see no distinction in principle between this Allahabad case and the case now before the Court. To hold that the present mortgage is valid by reason of the fact that Gopal Bux Rai and Bindeshwari Bux Rai executed it along with Jageshwar Bux Rai would in effect be permitting a mortgage by the disqualified proprietor Jageshwar Bux Rai. Further the mortgage cannot be held to be valid because there is nothing to show that either Gopal Bux Rai or Bindeshwari Bux Rai were kartas or were entitled to bind the interest of the whole family which undoubtedly at that time consisted of a number of minor members.
For the reasons which I have given, I am satisfied that the motgage in suit did require the previous sanction of the Commissioner, and as such was not obtained it is void by reason of Section 12A, Chota Nagpur Encumbered Estates Act. The plaintiffs, therefore, could not maintain a suit on the mortgage and the same should have been dismissed. Holding as I do that this mortgage is invalid, the appeal will have to be allowed. A number of other points, however, were taken before us, and as the case is of importance I shall shortly refer to them.
On behalf of the appellants, it was contended that even if the three executants could execute a valid mortgage, the mortgage in suit could not be enforced by reason of the fact that it was not for legal necessity. In the trial Court, the point of legal necessity was taken by all the minor defendants, and clearly it was open to the minor members of the family to take the point. The learned Subordinate Judge held that the mortgage was for legal necessity, and the question now arises whether defendants 10 and 14 who alone have appealed can challenge that finding. These appellants, as I have stated, are subsequent transferees, and they cannot raise the question of want of legal necessity unless they are transferees of the whole interest of the family. That a transferee of the whole interest of the family can challenge a mortgage on the ground of want of legal necessity has been recognized in a number of cases. In Muhammad Muzamil-ullah Khan v. Mithu Lal (''11) 33 All. 783, a Full Bench of the Allahabad High Court held that a person who had acquired the whole interest of the family in the mortgaged property could challenge the mortgage on the ground of want of legal necessity. A similar view was taken by the Allahabad High Court in Madan Lal v. Chiddu AIR 1930 All. 852 in which it was held that an alienation made by a member of a joint Hindu family was not void but voidable at the option of the other members thereof or any one of them and that it could not be impeached by the alienee himself or by any transferee who had not acquired by transfer or prescription the interest of the entire joint family in the property alienated. This view has been followed in this Court in Kharag Narain v. Janki Rai AIR 1937 Pat. 546 . At p. 237 James, J. expressly approved of the Allahabad decision in Madan Lal v. Chiddu AIR 1930 All. 852 .
It has been contended, however, by Mr. De on behalf of the plaintiff-respondents that it has not been established in this case that the appellants or either of them are transferees of the whole of the family interest. The importance of this point was not realised in the Court below, and the precise nature of the interests acquired by them does not seem to have been investigated. Appellant 10, it appears, is the transferee of 12 annas of village" Imli. In execution of a mortgage decree and a simple money decree obtained later for the deficiency he purchased 12 annas of the village. The only document which goes to prove his title is a copy of a plaint (Ex. 4 (a) ) put in evidence by the plaintiffs and printed at pages 13, 14 and 15 of part III of the paper-book. In that plaint it is stated that defendant 10 obtained a fraudulent ex parte mortgage decree and that in execution of the same he put up the properties to sale and purchased 4 annas share of mauza Imli and that later he obtained a money decree under Order 34, Rule 6, Civil P.C., and again put up for sale 8 annas of village Imli and purchased the same. From para. 5 of this plaint it appears clear that defendant 10 had obtained his mortgage decree against a number of the members of the family, but whether against all is by no means certain. Further it is doubtful whether this document executed by the family members can be used against the plaintiffs. This matter should have been further investigated in the Court below, and on the materials before me I cannot hold that the appellant-defendant 10 acquired the whole interest of the family in the 12 annas share in Imli.
It is fairly clear that defendant 14 purchased nothing more than the interest of one of the members of the family, namely that of Gopal Bux Rai. This point was not investigated in the Court below, and-it has not been seriously pressed before us that he is a transferee of the whole family interest. Neither appellant, therefore, can question the validity of the mortgage for want of legal necessity.
In my view, however, this mortgage was not executed for legal necessity. Admittedly the money was borrowed to enable Gopal Bux Rai to embark on litigation to recover the Deogan estate. The money was borrowed when the prospects of that litigation were by no means certain. The litigation eventually ended in his favour, though the Subordinate Judge who heard the case at first instance found against him and that decision was affirmed by one of the three learned Judges who heard the appeal in this Court. The estate which Gopal Bux Rai was seeking to recover was an impartible one, and when he recovered it, it would be enjoyed by himself to the exclusion of his brothers and their children. Gopal Bux Rai''s brothers had no claim for maintenance or a khorposh grant against Gopal Bux Rai because they were already the holders of a khorposh estate granted by a previous holder, of the Deogan estate. When this mortgage was executed, it was by no means certain that Gopal Bux Rai would derive any real benefit from it; but it was certain that the other members of the family could derive no immediate benefit whatsoever from the transaction. It has now been held that an impartible estate is in one sense a family property; but it is clear that where the rule of primogeniture prevails other members of the family have a very limited interest in the property. They may have in certain circumstances a right to maintenance and they have a possible right of succession in case of the failure of male heirs of the holder of the estate. In the present case the most that the other members of the family could hope for, was succession to the property, in the event of failure of heirs. Of course, they might have expected generous and favourable treatment from Gopal Bux Rai, but that would depend entirely upon his generosity. They had, in the circumstances of this case, no legal right to any immediate benefit. At most one or other of them might succeed to the property in the event of the failure of male heirs of Gopal Bux Rai. It would appear that at the date of this suit, Gopal Bux Rai had no son, but we are informed that in the meantime a son had been born to him, and if that be so, the chances of any member of the family succeeding to the Deogan estate are becoming more and more remote.
Mr. De boldly argued that as the Deogan estate could be regarded in one sense as family property, it was always open to a karta to borrow money to recover such property whether the recovery of the same would be beneficial to the family generally or not. In my view, a karta of a family would not be entitled to burden the whole of the family property to acquire property which would prove of no benefit whatsoever to the members of the family as such. The present transaction has ultimately turned out to be of real benefit to Gopal Bux Rai; but it has been of no benefit whatsoever to the other members of the family. As laid down in Hunooman Persaud v. Mt. Babooee Munraj Koonweree 6 M.I.A. 393 , "the power of a manager for an infant heir to charge an estate not his own is under the Hindu law, a limited and qualified power. But it can only be exercised rightly in a case of need, or for the benefit of the estate. But where, in the particular instance, the charge is one that a prudent owner would make, in order to benefit the estate, the bona fide lender is not affected by the precedent mismanagement 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 be regarded." The same test must be applied in the present ease. Would a prudent owner have entered into such a bargain or in short was the transaction for the benefit of the estate or the family? It appears to me that the transaction was merely for the benefit of one of the members of the family and was such that a prudent manager would not have entered into as the other members of the family whose interests were also mortgaged could receive no benefit from the loan. In my view, this advance was not made for legal necessity, and the finding of the learned Subordinate Judge on this issue cannot be maintained.
A point was taken by Mr. B.C. De, on behalf of the respondents that the present appeal was incompetent by reason of the fact that minor respondents 10 to 13 were not before the Court. These respondents were minors who had been originally '' impleaded in the appeal. The appellants, however, failed to deposit the necessary guardian''s costs, and by an order dated 17th August 1939, the appeal was dismissed as against these respondents. Mr. De has argued that as all the respondents are not before the Court there is a possibility of conflicting decrees, and therefore, the whole appeal must fail.
The minor respondents against whom the appeal was dismissed were sons and grandsons of the mortgagors. Neither, the mortgagors nor their descendants have appealed against the decree, and the present appellant''s who are transferees of the property sought no relief whatsoever in this appeal against the mortgagors. In appealing they merely sought to establish that the property in their hands was not liable to satisfy the mortgage. It appears to me that if the appellants succeeded in showing that the property in their hands was not liable there would not be inconsistent decrees. The respondents. against whom the appeal had been dismissed were admittedly not in possession of any of the property and the decree of the trial Court, in so far as it stands against them, is worthless and a mere scrap of paper. In my view it was open to the appellants to pursue the course they did, and having regard to the fact that the mortgagors and the mortgagees were made parties to the appeal the present appeal cannot be said to be incompetent. AH the parties who were necessary for the decision of the points at issue were before the Court.
It was conceded by Mr. B.C. De on behalf of the plaintiff-respondents that Section 7, Bihar Money-lenders (Regulation of Transactions) Act, 1939, would apply to this ease. That being so, the plaintiffs could not recover by way of interest up to the institution of the suit a sum greater than the principal advanced. In short, the decree could not be for more than Rs. 8000 up to the date of the institution of the suit together with reasonable interest on the sum advanced up till the end of the period of grace. The point, however, is not important, as, in my view, no decree should have been passed.
In the result, therefore, I would allow this appeal, set aside the decree of the Court below and dismiss the plaintiffs'' claim. In all the circumstances, I would make no order as to costs.
Chatterji, J.
This appeal arises out of a suit brought to enforce a simple mortgage for Rs. 4000 executed on 6th November 1923 by the first three defendants, namely, Gopal Bux Rai, Jageswar Bux and Bindheshwari Bux Rai. These three defendants together with defendants 5 to 9, who are sons and grandsons of defendants 2 and 3, constitute a joint Mitakshara family, and the mortgage is sought to be enforced against the joint family on the ground that the loan was taken for family necessity. Defendant 4 was a widow of a deceased coparcener, but she died during the pendency of the suit and her name was struck off. Defendants 10 to 13 were impleaded as subsequent transferees of the mortgaged property. The claim in the suit was laid at Rs. 16,347, including interest at 2 per cent, per mensem simple, though the bond provided for compound interest at that rate with yearly rests.
The mortgaged property is village Imli which forms part of a khorposh estate known as the Imli estate which was granted by Kishun Bux Rai, the holder of the parent impartible estate known as the Deogan estate, to his uncle fateh Bux Rai. On Fatch Bux''s death the Imli estate devolved by inheritance on his four sons Biseswar Bux Rai, Rameswar Bux Rai, Jageswar Bux Rai (defendant 2) and Narain Bux Rai. In 1904 on the application of these four brothers the Imli estate was taken over by a manager appointed under the provisions of the Chota Nagpur Encumbered Estates Act (6 of 1876). In the meantime, three of these brothers, namely, Biseswar Bux Rai, Rameswar Bux Rai and Narain Bux Rai died. Gopal Bux Rai (defendant 1) is the son of Biseswar Bux Rai and Bindheshwari Bux Rai (defendant 3) is the son of Rameswar Bux Rai. Mt. Jaggarnath Kuer, defendant 4, was the widow of Narain Bux Rai. On 27th March 1923, the estate was released from the management under the Encumbered Estates Act and handed over to Gopal Bux Rai, Bindheshwari Bux Rai, Jageswar Bux Rai and Mt. Jaggarnath Kuer. It is, however, common ground that Mt. Jaggarnath Kuer, being the widow of a deceased coparcener, had no right to the property.
About that time Surendra Bux Rai, the then holder of the parent impartible estate, died, and after his death dispute arose regarding succession to the estate between Gopal Bux Rai and one Lalu Nand Kishore Bux Rai who claimed to be a posthumous son of Surendra Bux Rai. This dispute led to the institution of a suit by Gopal Bux Rai against Lalu Nand Kishore Bux Rai. On 13th October 1923 Gopal Bux Rai made an application to the Deputy Commissioner of Palamau for permission to raise a loan of Rs. 10,000 for meeting the expenses of the said suit. On 1st November 1923 the Deputy Commissioner forwarded this application to the Commissioner, Chota Nagpur Division, with the recommendation that Gopal Bux Rai might be permitted to raise a loan of Rs. 4000 only "on the security of his property." Eventually on 13th February 1924 the Commissioner granted permission to Gopal Bux Rai to raise a loan of Rs. 4000 "on the security of his property." The mortgage bond in suit had in the meantime already been executed on 6th November 1923.
In the plaint it was alleged that no sanction of the Commissioner was necessary, but to avoid trouble the application was made by Gopal Bux Rai to obtain his sanction.
The suit was contested by almost all the defendants, but in this appeal we are concerned with the defence of defendants 10 and 14. Their substantial defence was that the mortgage, not having been executed with the previous sanction of the Commissioner, was void according to the provisions of g. 12A, Chota Nagpur Encumbered Estates Act, and that the rate of interest claimed was too high. It is also, necessary to mention that defendants 7, 8, 9 and '' 9 (a) who were minors challenged the validity of the mortgage on the further ground that there was no legal necessity to justify its execution.
The learned Subordinate Judge, while overruling the other defences raised by the various defendants, held that the stipulated rate of interest which was 2 per cent, per mensem compoundable every year was hard and excessive, and that simple interest at 1 per cent, per mensem was quite fair and reasonable. He accordingly passed a preliminary mortgage decree in favour of the plaintiffs, allowing simple interest at 1 per cent, per mensem. The decree is thus for a sum of Rs. 11,162-10-8 for principal and interest, besides costs. Prom this decree defendants 10 and 14 have preferred this appeal.
The minor defendants 7, 8, 9 and 9 (a) were impleaded in this appeal as minor respondents 10 to 13. As the appellants did not deposit the guardian''s cost with regard to these minor respondents, the appeal was dismissed against them by Order No. 19, dated 17th August 1939. At the hearing of this appeal Mr. B.C. De on behalf of the respondents took the objection that the appeal, having been already dismissed against the minor respondents 10 to 13, could not proceed. I shall deal with this objection later.
The first contention raised by Mr. S.N. Dutt on behalf of the appellants is that the mortgage, having been executed in contravention of the provisions of Section 12A, Chota Nagpur Encumbered Estates Act, is altogether void. The relevant provisions of that section are as follows:
(1) When the possession and enjoyment of property is restored under the circumstances mentioned in the first or the third clause of Section 12, to the person who was the holder of such property when the application u/s 2 was made, such person shall not be competent without the previous sanction of \\, the Commissioner,
(a) to alienate such property, or any part thereof, in any way, or
(b) to create any charge thereon extending beyond his life-time.
. . . . . . . .
(3) Every alienation and charge made or attempted in contravention of Sub-section (1) shall be void.
Mr. Dutta''s argument is two-fold: Firstly, that there was no previous sanction of the Commissioner and secondly, that the sanction that was subsequently granted by the Commissioner was given to Gopal Bux Rai only and not to the other two mortgagors Jageshwar Bux Rai and Bindeshwari Bux Rai.
The application Ex. 2 dated 13th October 1923 shows that it was made to the Deputy Commissioner by Gopal Bux Rai alone. It was indeed signed on. his behalf by Jageswar Bux Rai as his am-mukhtear, but from this it cannot be argued that Jageshwar Bux was himself an applicant. Exhibit 1 is the letter of the Deputy Commissioner, dated 1st November 1923, forwarding Gopal Bux''sapplication Ex. 2 to the Commissioner. The recommendation in this letter is in these words "I recommend that he may be permitted to raise a loan of Rs. 4000 only on the security of his property." With reference to this letter, the Personal Assistant to the Commissioner wrote a letter Ex. 1 (a) dated 22nd November 1923 to the Deputy Commissioner, enquiring if the other co-proprietors of the Imli estate had any objection to Gopal Bux Rai raising a loan on the security of his property, or whether the property had been partitioned. To this, the Deputy Commissioner sent a reply Ex. 1 (b) on 1st February 1924 stating that the proprietors had no objection to, Gopal Bux Rai raising the loan and further that "All the proprietors jointly have in fact raised a loan from one Jodha Sahu of Hariharganj by a registered deed bearing interest at 2 per cent, a month." This registered deed is the mortgage bond in suit which had m the meantime been executed on 6th November 1923. Eventually the Commissioner passed the following order, Ex. 5 on 12th February 1924: "The petitioner is permitted to raise a loan of Rs. 4000 on the security of his property.
From the above proceedings, it is obvious that the mortgage bond in suit was executed before the sanction was given to Gopal Bux alone. On the plain terms of Section 12A, an alienation without the previous sanction of the Commissioner shall be void. The learned Subordinate Judge has held that the sanction of the Commissioner, though given subsequent to the mortgage, was a sufficient compliance with the provisions of Section 12A. It is true that the sanction was granted with the full knowledge that the transaction had already taken place, but the sanction can in no way be regarded as "previous sanction" without doing violence to the language. Whatever may have been the reason, the Legislature designedly used the expression "previous sanction" and expressly enacted that an alienation without such sanction "shall be void." The words used in a statute must be read in the exact and plain sense which they imply. In this connexion reference maybe made to the decision of the Privy Council in Gaurishankar Balmukund v. Chinnumiya AIR 1918 P.C. 168 . In that case their Lordships had to deal with a mortgage executed by a judgment-debtor in contravention of the provisions of Section 325A, Civil P.C., (Act 14 of 1882). That section provided:
So long as the Collector can exercise or perform in respect of the judgment-debtor''s immovable property, or any part thereof, any of the powers or duties conferred or imposed on him by Sections 323 to 325 (both inclusive) the judgment-debtor or his representative-in-interest shall be incompetent to mortgage, charge, lease or alienate such property or part except with written permission of the Collector, nor shall any Civil Court issue any process against such property or part in execution of a decree for money.
Before their Lordships it was contended on behalf of the mortgagee appellant, that the mortgage would be operative over any residue that might be left to the judgment-debtor after the Collector''s regime had ended. Their Lordships in rejecting this contention said that the section must be read "in the complete and operative sense natural to the words, that is to say, of incompetency to mortgage such property." Taking the plain words of Section 12A, Chota Nagpur Encumbered Estates Act, I am constrained to hold that the mortgage in question is void.
Mr. B.C. De refers to Sub-section (4) and (5) of Section 12A which provide that the Deputy Commissioner may, either of his own motion or on the application of any person interested, make an inquiry to ascertain whether any holder of property who is referred to in Sub-section (1) has made any alienation, or charge in contravention of that Sub-section, and if he is satisfied that such holder has made such alienation or charge, he may make a report to the Commissioner requesting that the provisions of the Act be re-applied to his case, and the Commissioner may with the previous consent of the Provincial Government publish a fresh order reappointing a manager. It is suggested that the only consequences of an alienation made in contravention of Sub-section (1) are those indicated in Sub-section (4) and (5). But Sub-section (3) is quite clear and is in no way over-ridden by Sub-section (4) and (5). These two latter Sub-sections have nothing to do with the effect of the alienation, as between the parties thereto. Sub-section (3) makes the alienation inoperative and thus hits the alliance, while Sub-section (4) and (5) prescribe a penalty for the alienor namely that his estate is liable to be again taken over by the manager of the encumbered estates.
The second branch of Mr. Dutta''s argument is that even assuming that the subsequent sanction of the Commissioner could be regarded to be in compliance with the provisions of Section 12A, two of the mortgagors namely Jageswar Bux Rai and Bindheshwari Bux Rai to whom no sanction was given had no right to execute the mortgage. From the Commissioner''s order Ex. 5, it is quite clear that he granted sanction to Gopal Bux Rai to raise a loan on the security of his property. This sanction is clearly of no avail, so far as the other two mortgagors are concerned. The mortgaged property being joint family property, the mortgage by Gopal Bux Rai alone would be invalid. It is argued that there is no evidence to show that Gopal Bux was the karta of the joint family; and that even if he was the karta, the mortgage was not for the benefit of the joint family.
Mr. B.C. De, on the other hand, contends that both Gopal Bux and Bindeshwari Bux were not disqualified holders within the meaning of Section 12A and that the mortgage was executed by them for family necessity, and therefore it would be binding on the joint family. In order to make the provisions of Section 12A applicable, it is necessary, in the first place, to show that the mortgagors were the holders of the mortgaged property when the application u/s 2 was made. Jageshwar Bux Rai, being one of the applicants u/s 2, was unquestionably a holder of the property. Gopal Bux and Bindeshwari Bux, however, were not among the applicants. The question now is whether they were holders of the property when the application u/s 2 was made. In the plaint it was distinctly asserted that no sanction of the revenue authorities was necessary. In the written statements though it was alleged that the mortgage in suit was void ab initio, having been effected without the previous sanction of the Commissioner of the Chota Nagpur Division, it was not specifically pleaded that Gopal Bux and Bindeshwari Bux who were admittedly not among the applicants u/s 2 were holders of the property when that application was made. On behalf of the defendants, there is absolutely no evidence to show that they were holders of the property at that time. The defendants, however, rely on certain statements of the plaintiffs'' witnesses regarding respective ages of Gopal Bux and Bindeshwari Bux. P.W. 3 who is plaintiff 1 says "Gopal Bux Rai was 24 or 25 years old when the transaction took place. " He also says "Bindeshwari Bux would be 40 or 45 years old." P.W. 5 who is one of the attesting witnesses to the mortgage bond in suit says I have seen Gopal Bux Rai. He was 24 or 25 years old then." The witnesses were giving evidence in 1938 about the transaction which took place in 1923, that is to say, 15 years before. Prom common experience it is not safe to rely upon a witness''s statement regarding the age of any person not closely connected with him. P.W. 3 says that he has never been to Nawa Jaipur, the village where the mortgagors'' family lives. So also P.W. 5 says "I do not go to Nawa." It is true that both P.W. 3 and P.W. 5 say that they knew defendants 1 to 3 from before the transaction in suit, but their evidence on the whole shows that they are not so intimately acquainted with defendants 1 to 3 that they would be able to give a correct idea of their age. It has been pointed out that the application u/s 2 of the Act was made in 1904 and the mortgage bond in suit was executed in 1923, and if therefore both Gopal Bux and Bindeshwari Bux were born subsequent to 1904 they would be just above 18 years of age in 1923. That being so, it was unlikely for the witnesses to say that Gopal Bux was 24 or 25 years old in 1923 and Bindeshwari Bux would be 40 or 45 years old. As regards Gopal Bux''s age, the witnesses were making statements as to what their impressions were in 1923. It is unsafe to base a finding of fact upon such statements. As regards Bindeshwari Bux''s age, the very statement that he would be 40 or 45 years old suggests that the witnesses have no accurate idea of age. The defendants plead Section 12A as a bar and it is for them to establish that the conditions laid down in that section are satisfied. There being no satisfactory evidence to prove that Gopal Bux and Bindeshwri Bux were in existence at the time when the application u/s 2 was made, it cannot be held that they are disqualified holders within the meaning of Section 12A.
In this view, it is unnecessary to consider how far there is a conflict between the two decisions of this Court in Supan Sahu v. Tulsi Singh AIR 1932 Pat. 143 and Rameshwar Dayfal Singh v. Ram Das Sahu AIR 1939 Pat. 451 . In both these cases, the Court had to consider the meaning of the expression "the person who was the holder of such property when the application u/s 2 was made" in Section 12A(1), Chota Nagpur Encumbered Estates Act. In the earlier ease, the appellant, who was apparently a Mitakshara son in existence at the time when his father''s estate was taken over under the Chota Nagpur Encumbered Estates Act, was held not to be a holder within the meaning of Section 12A(1). The report of the case however does not make it clear whether the father''s estate was his separate property or the joint family property of himself and his sons. In the later case it was held that "there is nothing in the Act to prevent the manager of a joint Hindu family from applying for protection under the Act on behalf of the entire family and when such an application is made by him in a representative capacity the whole family and not he alone will be deemed to be the holder of the estate." If really there is any conflict between these two decisions, the matter would have to be referred to a larger Bench. But no such necessity arises in the present case.
The position, then, is that of the three mortgagors only one, namely Jageshwar Bux Rai (defendant 2) was a disqualified holder within the meaning of Section 12A. Gopal Bux and Bindeshwari Bux were free to execute the mortgage without any sanction of the Commissioner. But they were members of a joint Mitakshara family and they could not deal with joint family property. Mr. B.C. De contends that the mortgage was for family necessity, and therefore it would be binding on the joint family, though executed by only two of the coparceners. He also argues that the question whether the mortgage was invalid for want of legal necessity could be raised only by the other coparceners and not by the subsequent transferees.
Mr. S.N. Dutta, on the other hand, contends that at any rate defendant 10 who is said to have purchased 12 annas share in village Imli in execution of a mortgage decree against all the members of the joint family is entitled to impeach the mortgage on the ground that there was no legal necessity. As regards the other transferees, defendants 11 to 14, it is conceded that defendants 11 to 13 in execution d of a money decree against Gopal Bux Rai purchased his 4 annas share in village Imli, and subsequently defendant 14 purchased that share from defendants 11 to 13. In the first place, it is important to observe that neither defendant 10 nor defendants 11 to 13 nor defendant 14 in their written statements raised the objection that the mortgage was bad for want of legal necessity. It is true that such objection was taken by defendants 7 to 9 (a) and therefore issue 7 was framed as follows:
Whether the loan under the bond in suit was contracted for legal necessity and is it binding on defendants 5 to 9 and the heirs of the deceased defendant 4?" But this issue has been decided in favour of the plaintiffs and the decree has not been challenged by defendants 5 to 9. In the next place, there is no satisfactory evidence on the record to prove that defendant 10 purchased the entire interest of the joint family in execution of the mortgage decree. Neither the mortgage decree nor the sale certificate has been produced. Even in his written statement there is no clear averment on the point.
In Madan Lal v. Chiddu AIR 1930 All. 852 it was held that an alienation of joint family property cannot be impeached on the ground of want of legal necessity except by the other coparceners or by persons who have acquired the entire interest of all the coparceners in the property. It was pointed out that such alienation is not'' void but only voidable at the option of the other coparceners. This decision was followed by a Division Bench of this Court in Kharag Narain v. Janki Rai AIR 1937 Pat. 546 . Again in Ram Kumar Ram Saraff v. Mohan Lal Maharaj AIR A.I.R. 1940 Pat. 270 it was held that "under the Mitakshara law though the manager of a joint Hindu family cannot alienate joint family property except for family necessity or with the consent of the coparceners if they are adults, yet an alienation by him which cannot be supported on those grounds, is not unlawful or void ab initio, but is voidable at,: the option of the other coparceners, who alone are affected by his unauthorized act, and no person who is a stranger to the family and does not possess a right to have the transaction defeated on other grounds, (e.g., u/s 53, T.P. Act) has a locus standi to intervene and impugn such an alienation, merely because it is in excess of his authority to deal with the property for family purposes." In the present case, defendant 10 is not proved to have acquired the entire interest of the joint family. That being so, I do not think he is entitled to challenge the validity of the mortgage in suit on the ground that: there was no legal necessity.
The matter however does not rest there. Different considerations arise in the present ease. The mortgage in question was executed by three coparceners one of whom was incompetent to make it by reason of the provisions of Section 12A(1), Chota Nagpur Encumbered Estates Act. The mortgage is therefore, prima facie invalid. If the plaintiffs claim that the mortgage is otherwise valid on the ground that it was executed by the karta of the joint family for family necessity, they must establish this before they can succeed in the suit. From that point of view, it is immaterial whether the objection could be raised by the transferee-defendants or not.
Mr. B.C. De''s argument is that the effect of Section 12A(1), so far as Jageswar, Bux Rai is concerned, is that he was incompetent to make any alienation, and there his position may be compared to that of a minor. If this were the true position, the mortgage might perhaps be valid if it could be shown that it was executed by the karta for family necessity. But the fallacy involved in the argument is that it assumes that Jageswar Bux Rai was altogether incompetent to deal with the property. In fact he had full power of alienation, provided he obtained the necessary sanction of the Commissioner. For aught we know, he was the senior member of the family and would presumably be the karta of the family. There is no evidence on the record to prove that either Gopal Bux or Bindheshwari Bux was the karta. In the plaint it was alleged that Gopal Bux Rai was "the then head of the Deogan family representing the senior-most member in the senior-most line of the family." But no evidence was adduced to prove that in fact he was the karta. If Jageswar Bux Rai was the karta, it would be paradoxical to hold that merely because he entered into the mortgage trans action without the previous sanction of the Commissioner the other coparceners of the family could validly create the mortgage as if they were themselves the kartas.
But Mr. B.C. De goes further and contends that any coparcener, not necessarily the karta, can alienate joint family property for family necessity. In support of this contention he relies on the following text of Vyasa cited in the Mitakshara:
Even a single individual may conclude a donation, mortgage, or sale of immovable property, during a season of distress, for the sake of the family, and especially for pious purposes.
Vijnanesvara''s explanation of this text is:
While the sons and grandsons are minors incapable of giving their consent to a gift and the like; or while brothers are so and continue un-separated; even one person who is capable may conclude a gift, hypothecation or sale of immovable property, if a calamity, affecting the whole family require it, or the support of the family render it necessary; or indispensable duties, such as the obsequies of the father or the like, make it unavoidable." (Mitakshara, I, i, 28, 29.)
It is, however, now well settled that only the managing member of a joint Hindu family has power to alienate for value joint family property for family necessity so as to bind the interests of all the undivided members of the family, whether they are adults or minors. To hold that any member of the joint family is clothed with such power would be inconsistent with the whole theory of coparcenary. Coparcenary property is held jointly by all the coparceners. No one of them can deal with it except with the consent of the others. There is, however, an exception in favour of the managing member who has an ample authority to do whatever is best for all concerned, and no individual can defeat this power merely by withholding his consent. "For where family necessity exists, that necessity rests upon the coparceners as a whole and it is proper to imply a consent of all of them to that act of the one which such necessity has demanded," Sahu Ram v. Bhup Singh AIR 1917 P.C. 61. The argument that any coparcener may deal with joint family property is opposed to the current of decisions and cannot be accepted.
On the question of legal necessity, the argument of Mr. B.C. De must also fail. The mortgage loan was taken for meeting the costs of the suit that was brought by Gopal Bux Rai to recover the Deogan estate. The suit, though it was dismissed by the trial Court, was decreed in appeal by the High Court, and the decision of the High Court, was affirmed by the Privy Council. As a result '' of the litigation, Gopal Bux Rai did recover the Deogan estate. Though it was an impartible estate, it must be held to be joint family property in view of the decisions of the Privy Council in Baijnath Prasad Singh v. Tej Bali Prasad Singh (''21) 8 AIR 1921 P.C. 62, Komamal v. Annadana AIR 1928 P.C. 68, AIR 1932 216 (Privy Council) and Collector of Gorakpur v. Ram Sunder Mal AIR 1934 P.C. 157 .
However, from the nature of the estate, it was held by Gopal Bux alone. The branches of Jageswar Bux and Bindheshwari Bux had no right to the estate except a mere chance of succeeding in case Gopal Bux died sonless. Even then the chance of succession would be limited to the surviving agnate in the senior line, that is to say, Bindheshwari''s line. Gopal Bux was then quite a youngman and the chances of succession in the event of his dying son-less were remote. In the circumstances, the transaction can hardly be said to be one which a prudent owner would have entered into.
The learned Subordinate Judge, relying upon Section 243(e) of Mulla''s Hindu Law, has held that the loan was contracted for legal necessity. Section 243(e) of Mulla''s Hindu Law simply says that "costs of necessary litigation in recovering or preserving the estate" have been held to be family necessity. But the estate spoken of there was presumably joint family property which would be jointly held by all the members of the family. The position is altogether different where the property is to be held by one member only. I am, therefore, unable to sustain the finding of the learned Subordinate Judge on the point.
It is next argued by Mr. B.C. De that the Imli estate which was granted as khorposh to Fateh Bux Rai was his separate property and on his death it devolved by inheritance on his four sons in equal shares, that is to say, they inherited the property as tenants in common, each having a four annas share. So Gopal Bux Rai had four annas share and Bindheshwari Bux Rai four annas, and therefore the mortgage would be valid at least to the extent of eight annas share of these two defendants. This argument is not only opposed to the general tenor of the plaint which suggests that the mortgaged property was joint family property, but is also un sustainable in law. The Imli estate might be the separate property of Fateh Bux Rai, but when it was inherited by his sons who were undisputedly joint, they held it jointly with benefit of survivorship. In other words, in the hands of the four sons it was joint family property. In Venkayamma Garu v. Venkataramanayyamma Bahadur Garu (''02) 25 Mad. 678. their Lordships of the Privy Council held that "members of a joint family who succeed to self acquired property take it jointly." That was a case in which two brothers who were members of a joint family inherited on their mother''s death their maternal grandfather''s estate. On the death of one of the brothers, the dispute arose whether they had taken their maternal grandfather''s estate jointly with benefit of survivorship. Their Lordships held that they held it jointly.
The first contention of Mr. S.N. Dutt succeeds, and the mortgage in question must be held to be void and unenforceable. In this view, it is unnecessary to deal with his next contention based on the provisions of Section 7, Bihar Money-lenders Act (7 of 1939). It is, however, conceded by Mr. B.C. De that under the provisions of that section the plaintiffs would not be entitled to recover more than Rs. 4000 as interest up to the date of the suit.
I shall now deal with Mr. B.C. De''s objection regarding the maintainability of the appeal. His contention is that under Order 34, Rule 1, Civil P.C., all persons interested in the right of redemption are necessary parties to a mortgage suit. The minor respondents 10 to 13 were interested in the right of redemption and were, therefore, necessary parties to this appeal. But Order 34, Rule 1 itself provides that it is "subject to the provisions of this Code." Order 34, Rule 1, therefore, must be taken to be subject to Order 1, Rule 9 of the Code which provides:
No suit shall be defeated by reason of the misjoinder or nonjoinder of parties, and the Court may in every suit deal with the matter in controversy so far as regards the rights and interests of the parties actually before it.
A person is a necessary party when in his absence the Court cannot pass an effective decree. For instance, in a partition suit no effective decree can be passed in the absence of any cosharer. Similarly, in a suit for dissolution of partnership, no decree can be passed without all the partners being impleaded. It has been held by this Court in Sital Prasad v. Asho Singh AIR 1922 Pat. 651 that in a suit on a prior mortgage a puisne mortgagee is a proper but not a necessary party. The effect of failure to implead a puisne mortgagee is that he will not be affected by any mortgage decree that may be passed in the suit. In the present case the position is much stronger. The minor respondents 10 to 13 were interested in the right of redemption. Their fathers or grandfathers are on the record and they are sufficiently represented by them. Even assuming that they are not so represented, it cannot be said that no effective decree can be passed in this appeal in their absence.
The mortgage fails. The mortgage money was payable according to the terms of the bond, Ex. 3 on 30th Kartick 1332 F.S. (November 1924). The suit was instituted on 15th August 1936, that is to say, more than six years after the money became payable. A personal decree is, therefore, barred by time. Consequently the entire suit must fail.
I therefore agree with my Lord that this appeal should be allowed and the suit be dismissed. In the circumstances parties should bear their own costs in both Courts.