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Jamshedji Pestonji Hodiwala Vs. Dorabji Kuverji Charna - Court Judgment

LegalCrystal Citation
SubjectLimitation;Property
CourtMumbai
Decided On
Case NumberFirst Appeal No. 169 of 1929
Judge
Reported inAIR1934Bom1; (1933)35BOMLR1091
AppellantJamshedji Pestonji Hodiwala
RespondentDorabji Kuverji Charna
DispositionAppeal allowed
Excerpt:
.....1908), section 10-express trustee-property vested for a specific purpose-purchase of property for parsi anjuman-purchase money paid by mortgage of properly-adverse possession by vahivatdar or manager-transfer of property act (iv of 1882), section 41-refund of purchase-price to manager.;defendant no. 1's father, who was the vahivatdar or manager of an old agyari or fire-temple of parsis, purchased in 1885 two houses on either side of the agyari 'on behalf of the anjuman of the juni agyari of the parsis' on condition that the houses were not to be resold, that at any time they could be incorporated into the temple, and that they should not be let to a non-parsi. the purchase-price was paid by mortgaging the houses. from 1891, defendant no. 1's father treated the houses as his own property..........or managers of the old agyari or fire-temple of chikhli and were representatives of the parsi anjuman, purchased these two houses, which are on either side of the agyari, for the anjuman, but subsequently, defendant no. 1's father treated this property as his own and mortgaged it to various persons and ultimately to defendant no. 4 who is at present in possession. defendants nos. 1, 2, and 3 are brothers, the only contending defendants are defendants nos. 1 and 4. defendant no. 1 is the son of kuverji mancherji, who was one of the original vendees and the person who set up his own title to the property. defendant no. 4 is a mortgagee now in possession from defendant no. 1, and defendant no. 5 is one of the trustees and is merely a pro forma defendant, and the remaining.....
Judgment:

W. Baker, Acting C.J.

1. This is an appeal from a decree of the First Class Subordinate Judge of Surat dismissing the plaintiffs' suit. The plaintiffs, who are three in number, sue as representatives of the Parsi Anjuman of Chikhli. They sue to recover two houses which have been mortgaged by defendant No. 1 to defendant No. 4, and put very shortly, their case is that originally the father of defendant No. 1 and two other persons, who were the vahivatdars or managers of the old Agyari or fire-temple of Chikhli and were representatives of the Parsi Anjuman, purchased these two houses, which are on either side of the Agyari, for the Anjuman, but subsequently, defendant No. 1's father treated this property as his own and mortgaged it to various persons and ultimately to defendant No. 4 who is at present in possession. Defendants Nos. 1, 2, and 3 are brothers, The only contending defendants are defendants Nos. 1 and 4. Defendant No. 1 is the son of Kuverji Mancherji, who was one of the original vendees and the person who set up his own title to the property. Defendant No. 4 is a mortgagee now in possession from defendant No. 1, and defendant No. 5 is one of the trustees and is merely a pro forma defendant, and the remaining defendants Nos. 6 to 10 are members of the Anjuman, who appear in response to the notice given under Order I, Rule 8, and some of them support the plaintiffs and some support the defendants.

2. The two principal points which arose in the case were whether the purchase by Kuverji and his two co-vendees was in their capacity as trustees of the Parsi Anjuman of Chikhli or in their individual capacity, and whether the suit was barred by limitation or whether it was governed by Section 10 of the Indian Limitation Act.

3. The Subordinate Judge found, after taking evidence, that Kuverji and his two co-vendees were trustees of the Anjuman and that the purchase was made on behalf of the Anjuman. But he held afterwards that they were not express trustees for the purpose of this sale, and relying on the case of Vidya Varuthi v. Balusami Ayyar I.L.R. (1921) Mad. 831 24 Bom. L.R. 629 he held that Section 10 of the Indian Limitation Act would not apply and therefore the suit was barred by limitation, the adverse possession of Kuverji having begun from 1891. The plaintiff's have appealed against this decision.

4. The details of the various transactions with regard to the property have been set out by the learned Subordinate Judge in considerable detail in his judgment, and I do not think it necessary to repeat them all as they are not disputed. The essential facts in connection with this appeal, put shortly, are that in the year 1885 Kuverji Mancherji, who is the father of defendant No. 1, Dadabhai Dajibhai and Burjorji Bhikhaji purchased these two houses, which are now in dispute and which stand close on either side of the old Agyari at Chikhli, from a representative of the family of the founder of that Agyari. The Agyari was founded by a lady named Sukhlibai. The exact date is not known, nor have we got the document by which it was transferred to the Parsi community. At the time of this sale, which is Exhibit 41 (at page 70 of the record) dated March 11, 1885, the two houses belonged to one Dorabji Rustomji Dhakmar, who was a descendant of Sukhlibai, and he sold these two houses to these three persons on behalf of the Agyari for Rs. 1,201. Now, it is to be noted that in this document these three persons, the vendees, described themselves as the persons carrying on vahivat on behalf of the Anjuman of the Juni Agyari of Kasba Chikhli, and at the close of the document it is stated that these two houses stand on each side of a house 'which has been in former times given to you (meaning the vendees), that is, to the Parsi Anjuman' by the vendor's ancestors. The sale is subject to three conditions. The first is that the houses are not to be Bold because they stand on either side of the Agyari. The second condition is that no obstruction should be offered to any charitable Parsi who desires to build a large fire-temple on the site of all the three houses, and the third condition is that if they are let they should only be let to Parsis.

5. It has been argued by the learned counsel on behalf of the respondents that the existence of these three conditions in the sale-deed indicates that the sale was not to these three persons as trustees of the fire-temple but to them in their private capacity. But if that was so, there was no necessity to describe themselves as vahivatdars of the Agyari. It is quite clear that the purpose for which these two houses were acquired was to prevent any building being erected on their sites which might, prove inconvenient to the Agyari which stood between them. That is an object which was in the interests of the temple, and the only persons to carry out that object were the trustees of that temple, and that is, as a matter of fact, what has been done by the sale-deed, and the admissions in this sale-deed are further confirmed by the mortgage-deed on the same day, Exhibit 42 (at page 76), which was passed by these three same vendees, namely, Kuverji Mancherji and two others in favour one Fakirji Ratanji to whom the property was mortgaged on the same day that it was purchased for the purchase-money of Rs. 1,201. It seems that the Anjuman was not in a position to pay the whole of the sale-price as will appear from what has been stated before. It is obvious that the object for which these houses were purchased was to prevent their going from Parsi into non-Parsi hands. They were not immediately wanted, and therefore, there was no objection to mortgage them to a Parsi. They were, therefore, mortgaged on the same day that they were bought but this mortgage-deed contains the same reference to the mortgagors being the persons carrying on vahivat on behalf of the Anjuman of the Juni Agyari, and then there is a very clear statement :

We have this day on behalf of the Anjuman of the Juni Agyari of the Parsis purchased from Parsi Dorabji Rustomji, Dhakmar of Navsari the two houses in question.

In view of these two very plain statements in the two documents, I do not think that there can be the slightest doubt that these two houses were purchased by these three persons acting as trustees of the Parsi Anjuman. They were purchased for and on behalf of the Parsi Anjuman, and there is also an entry in the books of the shroff with whom the Anjuman kept their money, of Rs. 50 to be paid as earnest money to a person living at Navsari for the purchase of their houses. That is in January, whereas the purchase is in March. The entry is Exhibit 183 (at page 185) and is dated January 4, 1885, and says :-

Rs. 50 debited to the khata of the Parsi People's Panchayat. Rs. 50 fifty in cash paid for giving as Bana (earnest money) at Navsari for building for the Agyari in the bazar.

6. It has been argued by the learned counsel on behalf of the respondents that there is no evidence prior to this purchase that there had been any trustees of this Anjuman and that anything had been done by them on behalf of the Anjuman. There are certain accounts put in which show that small sums had been withdrawn by various persons including Kuverji on behalf of the Parsi Anjuman from the moneys which they had deposited with the witness. But in view of the plain statements contained both in Exhibits 41 and 42, and the repeated statements that the purchase was made on behalf of the Agyari by these persons acting as vahivatdars of the Anjuman, I do not feel the slightest doubt that the finding of the learned Subordinate Judge on the second issue is correct, and also on the third issue, that is, that the properties were purchased by these three persons for the Parsi Anjuman of Chikhli as alleged in para. 3 of the plaint, and that the Parsi Anjuman of Chikhli is the owner of the properties in suit.

7. The subsequent history of the property is rather complicated and I need not go into it in detail. First of all the two co-vendees along with Kuverji sold their interest in the property, such as they had, to him by two deeds on the same day, by Exhibit 43 (at page 80) Burjorji Bhikhaji, and on the same day the other purchaser sold his interest in the property to Kuverji on December 31, 1890, and thereafter Kuverji began to treat the property as his own. He mortgaged it again and again and in each instance as his own property. Some of the mortgages have been redeemed. On his death, which happened in 1914, he left three sons, defendants Nos. 1, 2 and 3. Defendants Nos. 2 and 3 relinquished their interest in this property to defendant No. 1 who is the contending defendant. I do not think it is necessary to go through all these documents which have been detailed by the Subordinate Judge. It is quite clear that from 1891 Kuverji, the father of defendant No. 1, treated this property as his own, and apparently no objection was raised by the Parsi Panchayat. Ultimately, on August 23, 1924, by Exhibit 54 (at page 108) and Exhibit 55 (at page 111) on the same day, defendant No. 1 mortgaged both these houses to defendant No. 4, the total amount of the two mortgages being Rs. 5000.

8. It has been found that the Anjuman is the owner of these properties and they were purchased by Kuverji and the other two vendees for the Anjuman. The only question which arises is whether there is anything which prevents the Anjuman from recovering them from the defendants. The learned Subordinate Judge is of opinion that Section 10 of the Indian Limitation Act, which is the only section which could save limitation, does not apply to the present case, and, therefore, the suit is barred by limitation, the adverse possession of Kuverji having begun as long ago as 1891. The learned Judge has relied on the principles laid down in the Privy Council case of Vidya Varuthi v. Balusami Ayyar, but that is a case which deals with Hindu and Mahomedan endowments and has no application whatever to the present case which is a case amongst Parsis. In the mofussil Parsis are governed by rules of justice, equity and good conscience, as has been laid down in the cases of Mancharsha Ashpandiarji v. Kamrunisa Begam (1868) 5 B.H.C. 109 and Mithibai v. Limji Nowroji Banaji I.L.R. (1881) Bom. 506 and the learned counsel for the appellants has argued on the strength of a series of decisions, that this is clearly a case in which the property has become vested in trust in Kuverji for a specific purpose, and that it is an express trust, and in support of this proposition he has quoted a number of cases beginning with Chintaman Ravji v. Khanderao Pandurang I.L.R. (1937) Bom. 184 30 Bom. L.R. 45 He has also relied on the cases of Soar v. Ashwell [1893] 2 Q.B. 390 The Secretary of State for India v. Prasad Bapuli I.L.R. (1922) Mad. 259 Secretary of State for India v. Bapuji Mahadeo I.L.R. (1915) Bom, 572 17 Bom. L.R. 641 Moosabhai v. Yacoobbhai I.L.R. (1904) Bom. 267 7 Bom. L.R. 45 Mathuradas v. Vandrawandas I.L.R. (1906) Bom. 222 8 Bom. L.R. 328 Narrondas v. Narrondas I.L.R. (1907) Bom. 418 9 Bom. L.R. 287 Bhurabhai v. Bai Ruxmani I.L.R. (1908) Bom. 394 10 Bom. L.R. 540 and on the case of Burdick v. Garrick (1870) L.R. 5 Ch. A. 233 which is a case of an agent occupying a fiduciary position.

9. It has been argued by the learned counsel for the respondents that assuming that we have a trust, the transaction is not incidental to the execution of the trust, and at the most, even if the purchase by the three vendees was on behalf of the Anjuman. it was a purchase merely as an agent, and it is only in very exceptional cases that an agent could be regarded as a trustee for the purpose of saving limitation.

10. I do not know whether it is necessary to go through all the cases which have been quoted by the learned counsel for the appellants. I think it is quite clear that in the present case the vendees, i.e., Kuverji and his two associates, were acting on behalf of the Anjuman, the purchase was for the Anjuman, and the purchase was made for the express purpose of guarding against the danger of these two houses which adjoined the fire-temple on either side from falling into non-Parsi hands and thereby causing some annoyance or obstruction to the religious ceremonies to be performed there, and I do not think that there could be a clearer instance of an express trust, the property having become vested in these three vendees for a specific purpose, namely, the maintenance of the fire-temple without interruption and avoidance of the possibility of alienation of the houses on either side. The case of Chintaman Ravji v. Khanderao Pandurang, which has been relied on by the learned counsel for the appellants, was a case where money was handed over by a widow to her brother for the benefit and education of her two minor sons, and it was held that the money being given to the brother for the boys-for their benefit and education, it was vested in him for a specific purpose, in other words, he was an express trustee. That case is based on Soar v. Ashwell I.L.R. (1915) Bom, 572 17 Bom. L.R. 641 Then in Secretary of State for India v. Prasad Bapuli we have a case where the East India Company and its successor the Government of India had become trustees for a specific purpose for the discharge of certain bonds issued in respect of certain liabilities, and it was held that the suit was not barred by limitation by reason of Section 10 of the Indian Limitation Act. There are numerous cases of this Court, Secretary of State for India v. Bapuji Mahadeo, Moosabhai v. Yacoobhai, and there are two cases of Mathuradas v. Vandrawandas and Narrondas v. Narrondas. The effect of these cases-I need not go through them all-is, as has already been stated, that where there is an express trust or a trust for a specific purpose, Section 10 of the Indian Limitation Act will apply and a suit will not be barred by limitation. I have already pointed out that this property was vested in the purchasers for a specific purpose, a purpose which has been indicated, and I am of opinion that Section 10 of the Indian Limitation Act will apply to save limitation, and that the view of the lower Court, which is founded upon a decision of the Privy Council which expressly refers only to Hindu and Mahomedan endowments and not to Parsi endowments as in the present case, should be set aside, and, therefore, the plaintiffs are entitled to recover possession of the property in suit from the defendants.

11. As regards defendant No. 4, it has been contended at some length by his learned counsel that he was for very many years a tenant of these houses from defendant No. 1 and defendant No '1's father, that he had no reason to believe that defendant No. 1 was not the true owner of the property, and that he is, therefore, entitled to claim the benefit of Section 41 of the Transfer of Property Act. He also contends that having invested the whole of his life's savings in this mortgage, he would be without a remedy after possession was taken away from him inasmuch as his personal claim against defendant No. 1 would now be barred. As to that, the consideration for the mortgage would only fail when the decree of the lower Court is reversed, that is from today, and as regards his right to rely on Section 41 of the Transfer of Property Act, it does not appear that he enquired into the title of his mortgagor as carefully as he ought to have done. Defendant No. 1 has admitted in his evidence that at the time when these mortgages of 1924 were written, the previous documents connected with this property were there with the writer. Now, although the writer's knowledge may not be defendant No. 4's knowledge, I find it difficult to believe that defendant No. 4 was not aware of the existence of those documents, at any rate, at that time, and the first two documents which are Exhibits 41 and 42, which have been dealt with at some length at the beginning of this judgment, clearly show that the father of defendant No. 1, Kuverji, was not the owner of this property but was merely a trustee in respect of it. In these circumstances, I would agree with the view which has been taken by the learned Judge at the close of his judgment that had he held that there had been an express trust as contended by the plaintiffs, then defendant No. 4 would not be entitled to the protection of Section 41 of the Transfer of Property Act.

12. In these circumstances, the decree of the lower Court must be set aside and a decree passed for the plaintiff's for the recovery of possession of the property with mesne profits and costs throughout against defendants Nos. 1 and 4. The other defendants should pay their own costs. Mesne profits to be determined in execution.

Divatia, J.

13. I agree. The learned Judge below has found all the issues in the plaintiffs' favour except one with regard to limitation, and even that issue, really speaking, turns upon the construction of the recitals in Exhibits 41 and 42. The learned Judge rightly held that under the sale-deed, Exhibit 41, all the interest had been conveyed by it to the Parsi Anjuman through the three vahivatdars, but although he thus held that the interest conveyed was to the Anjuman, still he went on to hold that the property had not been vested in trust in these three persons for an express purpose, and that the sale-deed did not so vest all the property conveyed under it in those three vahivatdars for a specific purpose. In holding so the learned Judge fell into the double mistake of holding that the trust was created only by the document, Exhibit 41, and secondly that even if the trust could be held to be created, the trust was not for a specific purpose.

14. There is no doubt whatever that the original trust was created when the Juni Agyari was made the subject-matter of the trust and handed over to the Parsi Anjuman of Chikhli, and although there is no definite evidence as to the date of the creation of the trust' or its exact terms, there is no doubt that there is sufficient evidence, especially the intrinsic evidence contained in Exhibits 41 and 42, that a specific trust had been created and that the sale-deed, Exhibit 41, had been entered into only as an incidental transaction in the administration of the trust. That being so, it is clear that not only was there a pre-existing trust before the date of Exhibit 41, but the property which was purchased under that deed was specifically vested in those trustees for the purpose of that trust. In that view, apart from the authorities that have been relied upon, it would be clear that there was on express trust, and Section 10 of the Indian Limitation Act would, therefore, apply, and the suit would not be barred by any length of time.

15. As regards the case of Vidya Varuthi v. Balusami Ayyar I.L.R. (1921) Mad. 831 24 Bom. L.R. 629 relied upon by the learned Judge, the learned counsel for respondent No. 1 has very fairly and rightly not relied upon the same here, as it is obviously an authority with regard to Hindu and Mahomedan religious institutions, and the trust in this case is a trust relating to a Parsi charity to which the principles laid down in that authority could not possibly apply. Those being the only two points on which the learned Judge decided against the plaintiffs, I think it is quite clear that the three original persona being express trustees, there is no bar of limitation for the present suit.

16. With regard to defendant No. 4, either he knew about the previous title-deeds or he did not. If he knew about the previous title-deeds, he ought to have known, especially from the two earlier documents, Ehxibits 41 and 42, that the persons who purchased thereunder and mortgaged were vahivatdars of Agyari. If he did not, then it was a case where he did not exercise reasonable care in tracing the title to the property. Therefore, in any view of the case, he is not entitled to the protection of Section 41 of the Transfer of Property Act, even assuming that that section applies here. Therefore, the learned Judge was right in holding that he is not entitled either to the possession of the property or to be indemnified for the mortgage, especially as his remedy against defendant No. 1 is still presumably open.

17. For these reasons I agree that the appeal should be allowed with costs throughout.

18. June 23. Baker Ag. C.J. After the delivery of this judgment the learned counsel for the respondents has raised a point that the property should not be ordered to be restored to the plaintiffs without requiring them to pay Rs. 1,201, possibly with interest, namely, the original purchase-price. It is argued by the learned counsel that the plaintiffs' Anjuman having paid nothing at all towards the purchase price, they have been getting the property for nothing, and therefore, on equitable principles they should be ordered to pay the purchase-money to defendant No. 1.

19. This point was not taken in the written-statement or in the memorandum of appeal, nor was any issue framed on it in the lower Court. Evidence would be necessary on the point as to the manner in which the original mortgage and the subsequent mortgage, Exhibit 45 (at page 86), in which the first mortgage was merged, were paid off. Moreover, it seems rather curious that a trustee, whose conduct has been nothing short of fraudulent and who has been in possession of the trust property as against the real owners for nearly forty years or more, should appeal to equity in order to compel payment by the real owner. As far as appears from the record in this case, nothing was ever paid in actual cash by the original vendee Kuverji and his descendants. The purchase-price was raised by the mortgage, Exhibit 42, which is with possession, and presumably his mortgagee entered into possession of the property and received profits. That mortgage was merged in the fresh mortgage of 1891, Exhibit 45 (at page 86), which is also a mortgage with possession. Part of the consideration of that mortgage is cash paid by the mortgagee for Kuverji in order to buy out the two co-vendees as already stated in an earlier part of this judgment. What appears to have happened is that Kuverji treated this property as his own and has been raising-money for his own purposes by succession of mortgages on it, and the purchase-price was never paid, at least there is no evidence to that effect, by Kuverji or his co-vendees in actual cash to the vendor, but it was raised by the mortgages and those mortgages were paid off out of the profits of the property. Even if there had been a payment by Kuverji and his co-vendees, it may be pointed out that Kuverji, in whom the rights of the other co-vendees merged, has been in possession of this property for at least forty years. Since 1890 he has been treating this property as his own and has been raising money for his own purposes by a succession of mortgages. In these circumstances, the real owners, the Anjuman, have been deprived of the possession of their own property for nearly half a century, and as far as I can see, if the transaction had been bona fide from the beginning and the property had been handed over to the Anjuman, they would presumably have done the same as Kuverji did, namely, paid the purchase-price by means of a mortgage, the mortgage being afterwards extinguished by receipt of the profits.

20. In these circumstances I do not think that there is sufficient reason for disturbing the order which has already been made, and I would, therefore, decline to review the judgment which was delivered yesterday.

Divatia, J.

21. I agree.


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