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Shivu Shidda Chaugula Vs. Lakhmichand Tuljaram Kothari - Court Judgment

LegalCrystal Citation
SubjectFamily
CourtMumbai
Decided On
Case NumberSecond Appeal No. 815 of 1936
Judge
Reported inAIR1939Bom496; (1939)41BOMLR1007
AppellantShivu Shidda Chaugula
RespondentLakhmichand Tuljaram Kothari
DispositionAppeal dismissed
Excerpt:
.....from his estate in the hands of the widow. during the pendency of the suit, the widow passed a deed of surrender of the entire estate of her husband in favour of her two daughters, in which she stated, 'i have given you the malki over the above-mentioned properties of my own ownership in accordance with the wishes of my husband.' the daughters mortgaged one of the plots of land. a consent decree was, thereafter, passed for the full amount in the suit against the widow, and the decretal amount was made payable by instalments, and in default the amount was to be recovered by sale of the two plots of land. in execution of the consent decree the plot mortgaged was put up for sale. the mortgagee, thereupon, brought a suit for a declaration that the plot be sold subject to his charge. this..........of the deceased in the hands of the widow. during the pungency of the suit avubai executed a deed of surrender (exhibit 54) in the plaintiffs' favour on july 1, 1924, in respect of the whole estate of her husband. suit no. 493 of 1923 ended in a compromise decree passed on october 25, 1924, under which avubai was to pay the debt by instalments, and in default the plaintiff was to recover the decretal amount by sale of survey no. 381 and survey no. 443|1 on which a charge was created, and, in case of deficit, from other properties of the deceased. the plaintiffs were not parties to this suit. the decree-holder assigned the decree to the defendant who has applied for execution by sale of survey no. 381. before this, on september 21, 1924, the plaintiffs had mortgaged survey no. 381.....
Judgment:

Sen, J.

1. The appellants were plaintiffs in a suit for a declaration that the plaint property was not liable for attachment and sale in execution of a money decree obtained by the predecessor-in-title of the defendant, in suit No. 493 of 1923, against their mother Avubai as the heir and legal representative of their deceased father Krishna Joti, and also for an injunction against the defendant.

2. The material facts are as follows. Krishna Joti died in May, 1922, leaving his widow, Avubai, and two daughters, who are the plaintiffs. One Anantrao brought suit No. 493 of 1923 on two promissory notes passed by Krishna Joti for the recovery of the amount due there under from the estate of the deceased in the hands of the widow. During the pungency of the suit Avubai executed a deed of surrender (exhibit 54) in the plaintiffs' favour on July 1, 1924, in respect of the whole estate of her husband. Suit No. 493 of 1923 ended in a compromise decree passed on October 25, 1924, under which Avubai was to pay the debt by instalments, and in default the plaintiff was to recover the decretal amount by sale of survey No. 381 and survey No. 443|1 on which a charge was created, and, in case of deficit, from other properties of the deceased. The plaintiffs were not parties to this suit. The decree-holder assigned the decree to the defendant who has applied for execution by sale of survey No. 381. Before this, on September 21, 1924, the plaintiffs had mortgaged survey No. 381 for Rs. 1,000 to one Dadu. On a darkhast having been filed under the decree aforesaid for the sale of survey No. 381 (darkhast No. 392 of 1929) Dadu brought a suit No. 647 of 1930 for a declaration that survey No. 381 was not liable to attachment and sale and for an injunction against the defendant. The defendant, however, by a purshis admitted the mortgage in favour of Dadu and asked for the right to redeem the property from such mortgage. The suit was accordingly dismissed on December 11, 1931, and under the darkhast only the equity of redemption in the property was put up for sale. The plaintiffs have accordingly brought the present suit.

3. The defence was that the deed of surrender had been passed with intent to defraud and defeat Avubai's husband's creditors and that therefore it was invalid Under Section 53 of the Transfer of Property Act, that it was also void Under Section 52 of the Transfer of Property Act, that the plaintiffs being the representatives of the widow, no separate suit on the present cause of action could lie Under Section 47 of the Civil Procedure Code, and that the plaintiffs being the universal domes under the surrender-deed were liable Under Section 128 of the Transfer of Property Act. The plaintiffs contended that the defendant's conduct in Dadu's suit estopped them from challenging the surrender-deed.

4. The trial Court held that the surrender was invalid Under Section 53 but not Under Section 52 of the Transfer of Property Act,-that there was no bar of! Section 47 of the Civil Procedure Code to the suit, that the plaintiffs were liable Under Section 128 of the Transfer of Property Act, and that the defendant was not estopped from challenging the surrender-deed. The lower appellate Court held that the defendant was not estopped from challenging the deed, that exhibit 54 was a collusive document passed with intent to defraud and deceive Krishna Joti's creditors, and that the suit was barred by Section 47 of the Civil Procedure Code.

5. In the present appeal no contentions based on Section 52 of the Transfer of Property Act or estoppel have been raised. Mr. Murdeshwar has contended, firstly, that after the surrender Avubai did not represent Krishna Joti's estate, and the compromise, therefore, could not bind that estate ; secondly, that Section 53 of the Transfer of Property Act does not apply as the surrender was not a transfer and there is no evidence of fraud ; arid, thirdly, that Section 47 of the Civil Procedure Code does not apply. Mr. Desai on behalf of the respondent has contended that exhibit 54 being a collusive document, it cannot be said that there was any] real surrender at all, and that if it be held that it was a surrender, it amounted to or involved transfer, and, therefore, Section 53 of the Transfer of Property Act applies. Thirdly, he has contended that Avubai having entered the compromise in her character as representing the estate, the compromise decree is binding on the reversionary, the present plaintiffs. Fourthly, he has contended that the plaintiffs are liable Under Section 128 of the Transfer of Property Act, and that Section 47 of the Civil Procedure Code applies as the plaintiffs are Avubai's 'representatives in interest.'

6. The first contention of Mr. Desai is, in my opinion, clearly untenable. It was neither party's case that the transfer was a sham or colourable transaction, and that it was, therefore, void ab initio. Though there are some indications that the appellate Judge might have been inclined to regard it in such light, there is no such defence in the written statement of the defendant, and three of the issues raised by the trial Court expressly refer to the transaction in dispute as a surrender. Though the lower appellate Court raised an issue No. 2, 'Whether exhibit 54 is a collusive document passed by Avubai with intent to defeat and defraud the creditors of the deceased Krishna', it is clear that this issue was raised in order to determine the applicability of Section 53 of the Transfer of Property Act. With regard to this issue the learned District Judge said:

I agree with the lower Court in holding that the deed (exhibit 54) was passed with intent to defeat and defraud the creditors of Krishna.

7. There was, thus, no! actual finding that the transaction was sham or colourable. It is, therefore, too late for Mr. Desai to raise such a contention in the present appeal.

8. The main issue in this case is whether Section 53 of the Transfer of Property Act applies, and, that is, whether the surrender is a transfer within the meaning of that section. If it is a transfer, then, in view of the finding of fact arrived at by both the Courts below, that the transfer was made with intent to defeat and defraud the creditors of the deceased Krishna Joti, it would be voidable Under Section 53. I see no difficulty in distinguishing between the two positions that the transfer was a sham or colourable transaction, i.e., it was not a real transaction at all, and that it was a transfer made with intent to defeat and defraud the creditors.

9. If the surrender can be void Under Section 53 of the Transfer of Property Act, it cannot be fairly argued that Avubai did not represent Krishna Joti's estate at the time of the compromise and that the compromise does not bind the estate. If the surrender is a transfer, it being without consideration will be a gift of the transferor's whole property, and the plaintiffs would be liable Under Section 128 of the Transfer of Property Act for the liabilities of the donor existing at the time of the transfer to the extent of the estate.

10. As regards the applicability of Section 47 of the Civil Procedure Code, the plaintiffs are not Avubai'3 representatives within the meaning of that section. It has not been seriously contended that a transferee of the interest of a party before a decree is passed against him or in his favour is such a representative.

11. Thus, the real question at issue is whether the surrender in this case is a transfer within the meaning of Section 53 of the Transfer of Property Act. No authority has been cited which covers this precise point. Mr. Murdeshwar, however, has relied on two Privy Council decisions, Bhagwat Koer v. Dhanukhdhari Prashad Singh and Sitanna v. Viranna I.L.R. (1934) Mad. 749 The first of these cases was not a case of transfer in any sense at all. In that case, upon the death of a Hindu in 1872 his nephew obtained a certificate under Act XXVII of 1860 as the sole survivor of his joint family ; the widow of the deceased opposed the application and alleged a partition in 1864. By agreements made in 1874 the widow accepted the decision, recognised the nephew's title, and was granted by him a maintenance allowance which she continued to receive until her death in 1904. It was held that the widow's agreement of 1874, in conjunction with her acceptance of maintenance till 1904, amounted to a complete relinquishment of the estate to the nephew, then the next reversioner. At pages 270-71 their Lorsdhips said :

The power of a Hindu widow to surrender or relinquish her interest in her husband's estate in favour of the nearest reversioner at the time has often been considered and was fully dealt with by the Board in the recent case of Rangasami Counden v. Nachiappa Gounden . As pointed out in that case, it is settled by long practice and confirmed by a series of decisions that a Hindu widow can renounce the estate in favour of the nearest reversioner, and by a voluntary act efface herself from the succession as effectively as if she had then died. This voluntary; self-effacement is sometimes referred to as a surrender, sometimes as a relinquishment or abandonment of her rights; and it may be effected by any process having that effect, provided that there is a bona fide and total renunciation of the widow's right to hold the property. In the present case there was indeed no formal surrender by the widow of her estate; but there was an express agreement, binding upon her, that for considerations which appeared to her sufficient she would abandon the claim which at the time she had a good right to make and would have no right, claim or demand in respect of the estate of her late husband. It is true that the documents were drawn up on the footing, not of a surrender of an acknowledged right, but of an admission that the right did not exist; but in substance, and disregarding the form, there was a complete self-effacement by the widow which precluded her from asserting any further claim to the estate.

12. In Sitanna v. Virmna the facts were that on the death of a Hindu in 1880 a dispute as to succession which arose between his widow and a claimant was referred to a pmchayat which awarded that the property should be divided between them. In 1888 the widow conveyed half the property to the claimant, and the other half, reserving about six acres for her own maintenance, to her daughter who was the reversionary heir to the deceased. The daughter died in 1894. On the death of the widow in 1921 the heir of her husband claimed the whole estate. It was held that the award of the panchayat should not be interfered with, as it appeared to be a fair and reasonable settlement of a doubtful claim based on both legal and moral grounds. A question that arose in that case was whether, assuming that the award given in his favour was good, the conveyance by the widow of the rest of the property, reserving only a few acres for herself, amounted to a surrender of her estate, her husband's next heir being her daughter who took only an estate for life. It was held that there was no reason for differentiation between the cases where the widow's husband's next heir was a male and where it was a daughter taking merely an estate for life, Their Lordships remarked in this connection (p. 759) :.though the doctrine of surrender by a widow has undergone considerable development in recent years, it must be remembered that the basis of it is the effacement of the widow's interest, and not the ex facie transfer by which such effacement is brought about. The result is merely that the next heir of the husband steps into the succession in the widow's place.

13. Mr. Murdeshwar has relied on this description for the basis of the surrender by a widow, and he has contended that the 'ex facie transfer' should not at all be considered in considering the nature of the transaction. He emphasizes the sentence, '.in substance, and disregarding the form, there was a complete self-effacement by the widow which precluded her from asserting any further claim to the estate,' to be found at p. 271 in Bhagwat Koer v. Dkanukhdhari Prasml Singh .

14. On the other hand, Mr. Desai has contended that such surrender has been regarded as a conveyance in several cases. For instance, in Sitarma v. Viranna I.L.R. (1934) Mad. 749 their Lordships said (p. 759):

It follows therefore that the widow's conveyance to her daughter Nagamma in 1888 was a surrender of her estate.

15. In Rmgasami Gownden v. NacMappa Gounden also the nature of a Hindu widow's surrender of her estate was one of the matters considered. The suit was instituted by one Rangasami Gounden against the minor respondent and his father together with thirty other defendants. The lands in dispute had formed part of the estate of one Ramasami Gounden, who had died childless, and his mother had then succeeded to his properties for a woman's estate. Thereafter she had executed a deed of transfer in favour of her nephew, who at that time was the nearest reversionary heir to her deceased son. At page 84 their Lordships stated one of their conclusions as to the effect of the decided cases thus :

An alienation by a widow of her deceased husband's estate held by her may be validated if it can be shown to be a surrender of her whole interest in the whole estate in favour of the nearest reversioner or reversioners at the time of the alienation.

16. At p. 79, their Lordships referred to Behari Lai V. Madho Lal Ahir Gyawal (1891) L.R. 19 L.A. 30 from which the following passage was quoted (p. 32):.it may be accepted that, according to Hindu Law, the widow can accelerate the estate of the heir by conveying absolutely and destroying her life estate. It was essentially necessary to withdraw her own life estate so that the whole estate should get vested at once in the grantee.

17. Mr. Desai has contended that these decisions of the Privy Council sufficiently show that where a deed of transfer clearly shows on whom the estate is to devolve on the widow's surrender, there is a clear conveyance or vesting of the estate in the grantee.

18. In Nilkmtha V. Mst. Muktabai [1936] Nag. 69 sitting singly, decided that the word 'transfer' in Section 53 of the Transfer of Property Act was wide enough to cover a surrender by a widow of her widow's interest. In that case the two widows of one Jagannath had surrendered their estate in favour of the daughter of one of the widows by a registered! deed, and it was held that as the effect of the surrender was to deprive the creditors of one of the widows of their remedy against her, the transfer was voidable Under Section 53.

19. In Haribhai v. Narayan (1937) 40 Bom. L.R. 876 Rangnekar J. has interpreted the doctrine of surrender in these words (p. 880):

The doctrine, as I understand it, is nothing more than this, that the widow, to use the words of Lord Dunedin, operates her own death. She withdraws her life estate in the property and divests herself of her ownership and vests that ownership from the moment of surrender in the next reversionary heir, if he be one, or in all the reversionary heirs, or, as it is sometimes called, the whole body of reversionary heirs, if there happen to be more than one in the same degree.

20. His Lordship referred to Bekari Lal v. Madho Lal Ahir Gyawal (1891) L.R. 19 IndAp 30 from which the following passage was quoted (p. 32):

It was essentially necessary1 to withdraw her own life estate so that the whole estate should get vested at once in the grantee. The necessity of the removal of the obstacle of the life estate is a practical check on the frequency of such conveyances.

21. The contention of Mr. Murdeshwar, however, is that the conveyance or alienation is not essential to a surrender as Bhagwat Koer v. Dhanukhdhari Prashad clearly shows, for in that case there was no conveyance nor any former surrender, but there was an ekrarnama passed by the widow which was construed to have the effect of a surrender.

22. In the present case the deed we are concerned with is exhibit 54, and in this Avubai plainly said that she had cancelled her ownership over the properties in suit and made them over to the plaintiffs' possession as full owners. Those last words, according to Mr. Murdeshwar, do not make the transaction a real conveyance. As in Bhagutat Koer v. Dkanukhdhari Prashad Singh the actual form of the deed had to be disregarded and the basis of the transaction must be held to be 'the effacement of the widow's interest, and not the ex facie transfer by which such effacement is brought about.' [Sitanna v. Virmna.] If the words apparently amounting to transfer are used in a deed of surrender, it must be remembered that such surrender can only be made in favour of the next reversioner of the whole body of rever-sioners and that, therefore, no choice in the matter of the transferees is possible such as one would expect in the case of a real transfer. No doubt in several of the cases cited above, words have been used which purport to convey the property in dispute and the judgments also have not expressly stated anywhere that the transactions in question did not amount to transfers. Mr. Murdeshwar's contention, however, is that if the transaction be one and its basis be the self-effacement of the widow, it would be illogical to regard it as constituting a transfer also at the same time. What some of the documents appear to have considered! in the cases cited above, according to him, is to state the effect of the surrender, i.e., the manner in; which the property in question was to pass to other persons or person, and he contends that this is not essential to a surrender as can be seen from Bhagwat Koer v. Dhmukhdhari Prashad.

23. The law as to the effect of surrender is considered at length by Rangnekar J. in Haribhai V. Narayan. I have already referred to a passage in which his Lordship held that according to the principle underlying the doctrine of surrender the widow withdraws her life estate in the property, divests herself of her ownership and vests that ownership from the moment of surrender in the next reversionary heir or heirs. After referring to the dictum of Sir John Wallis in Vytla Sitanna v. Marivada Viranna that the basis of it is the effacement of the widow's interest, his Lordship said (p. 881):

The principles, therefore, which I gather from these decisions and others referred to in the course of the argument are these : (1) That there must be a complete self-effacement of the surrendering widow with the intention of accelerating the succession of the next apparent heir; (2) that the surrender must be bola fide and must not be a mere cloak, the real object of which was to divide the estate between the reversionary heir and the widow; (3) that it is the substance of the transaction that has to be considered in determining the question whether a conveyance operates as a good surrender or not.

24. The use of the word 'conveyance' is again to be noted. Even: in Bhagwat Koer v. Dhmukkdhari Prashad Singh on which Mr. Murdeshwar relies, it is pointed out that it is settled law that the Hindu widow can renounce the estate in favour of the next reversioner. This case was not considered with reference to Section 53 of the Transfer of Property Act, though it no doubt shows that there can be surrender without express transfer or conveyance, All the other cases considered, however, show that, as a matter of fact, the surrender was made in favour of the next reversioner. This being so, there is no reason to think that in such cases the conveyance is also not an essential part of the transaction ; for one can hardly expect a widow to state in a deed merely that she is effacing herself from her husband's estate. It seems to me doubtful whether, were such a document executed, it could be regarded as a proper deed of surrender. In Sitanna v. Viranna, it is no doubt stated at p. 759, that the basis of the surrender is the effacement of the widow's interest and not the ex facie transfer by which such effacement is brought about. I have shown above that this statement occurs in the discussion of the question whether there can be a valid surrender in favour of the widow's daughter, a discussion which arose for the purpose of the consideration of the question of limitation which was raised in that case. From this point of view, the aspect of surrender which gives rise to the question whether it amounts to a transfer or not within the meaning of s, 53 of the Transfer of Property Act, was unimportant. There can be no doubt in the present case that exhibit 54 does not merely show the effacement of the widow. Before she made the statement, 'I have cancelled my ownership,' Avubai clearly stated, 'I have given you the malki over the above-mentioned properties of my ownership in accordance with the wishes of my husband.' I see no reason why this should not be regarded as amounting to a transfer within the meaning of Section 53 of the Transfer of Property Act. As to the reason which actuated her in passing the deed she said:

It is my desire that according to the wishes of my husband the property of :my ownership should go to you.Lest there should be any impediment whatever in your way arising from claims of adoption, bhaubandi, etc., I am executing this malaki patra in your favour.

25. Thus the desire that the property should vest in her daughters was even more prominent in Avubai's mind than her desire to 'cancel her ownership', to use her own language. Psychologically considered, her self-effacement was, but the means whereby the end she desired to attain was attained. I have, therefore, no hesitation in finding that the present case must be held to be one of transfer and not merely of self-effacement of the widow.

26. In this view, it having been held by the Courts below as a finding of fact that exhibit 54 was passed with intent to defeat and defraud Krishna Joti's creditors, the transaction must be held to be void. The plaintiffs' suit has, therefore, rightly failed and the appeal will, accordingly, be dismissed with costs.


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