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Jivram Jagjivandas Dave Vs. Kantilal Keshavlal Trivedi and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtMumbai
Decided On
Case NumberFirst Appeal No. 394 of 1943
Judge
Reported inAIR1950Bom247; (1950)52BOMLR104
ActsTransfer of Property Act, 1882 - Sections 53; Limitation Act, 1908 - Schedule - Article 120; Hindu Law
AppellantJivram Jagjivandas Dave
RespondentKantilal Keshavlal Trivedi and ors.
Appellant AdvocateN.G. Shah, Adv.
Respondent AdvocateC.K. Shah and ;K.T. Pathak, Advs. for Respondents 1 and 2
Excerpt:
hindu law - debt--pre-partition debt of father--pious obligation of sons to pay debt--decree against father obtained after partition --execution suit by creditor against father for declaration that son's interest liable--suit against sons barred by limitation---whether suit for declaration maintainable--partition effected pending creditor's suit whether fraudulent.;a creditor obtained a money decree against the father in a joint hindu family governed by the mitakshara after a partition of the family property had taken place between the father and his sons. the creditor sued for a declaration that in execution of his decree the sons' interest was also liable to be brought to sale, the remedy of a suit for recovery of the debt against the sons not being available owing limitation at the..........were not parties even to that suit. he said that, at the time when the plaintiff filed his present suit, a suit against the sons in respect of the liability of defendant 6 upon the mortgage bond was barred by time. a suit by the plaintiff against the other sons upon the mortgage was in time because of an acknowledgment dated 22nd december 1938, written by defendant 6 which amounted to a promise in writing to pay a time, barred debt, bat all the same he nonsuited the plaintiff because it was his view that the partition was a bona fide partition. he said that so far as the liability of defendant 6 under the surety bond was concerned, no one thought at the time when the partition was effected that there would be any deficit after the property which was mortgaged by mahalaxmi to the.....
Judgment:

Bavdekar, J.

1. This is an appeal from a suit which was filed by the plaintiff on behalf of himself and other creditors of defendant 6. The plaintiff said that, at the time when the salt was filed, there were two debts due to him from defendant 6. The first was a debt incurred by defendant 6's wife, Mahalaxmi, who died before the present suit was filed. The debt was incurred by Mahalaxmi upon mortgage of property which belonged to her as her absolute property. But on the date upon which the mortgage was executed by Mahalaxmi, defendant 6 executed a surety bond under which he agreed to pay the plaintiff the amount of the debt of the mortgage in case Mahalaxmi did not pay it. The actual bond, which was executed by defendant 6, is not before us because the plaintiff said that he had lost it. But the plaintiff proved another bond executed by defendant 6 in lieu of the lost bond, which supports the contention of she plaintiff. Under this bond, defendant 6 again undertook the liability of paying the plaintiff his debt due from Mahalaxmi in case she did not pay it. The second debt which the plaintiff said was due to him was upon a mortgage executed by defendant 6 and the eldest son of defendant 6, defendant 3, the document being actually executed by defendant 6, on behalf of both on 90th February 1930, defendant 3 being then a minor.

2. The plaintiff had sued Mahalaxmi and defendant 6 upon the first debt, and he had obtained upon it a decree which was composite. In the first instance, it directed the sale of the property which was mortgaged by Mahalaxmi in payment of the debt due upon the mortgage. In the second instance, it gave the plaintiff liberty to apply, in case the proceeds of the mortgaged property were not sufficient, for a personal decree against both Mahalaxmi and defendant 6. The property which was mortgaged by Mahalaxmi was sold in accordance with the decree in 1937, and there was a deficit. Thereupon, the plaintiff applied for a personal decree against both Mahalaxmi and defendant 6, on 1st September 1938, and obtained it on 14th August 1939 the amount of the decree being Rs. 1,800 and odd.

3. Upon the second mortgage bond, the plaintiff filed a suit No. 60 of 1939 and obtained a preliminary decree against defendant 6 and defendant 3 on 29th October 1942.

4. The plaintiff's case was that, after the sale of the property mortgaged by Mahalaxmi, but before the date of his application for a personal decree against defendant 6, defendant 6, his sons defendants Nos. 3, 4 and 5, and another wife of defendant 6 partitioned the joint family properties inter se, giving to the share of defendant 6 only one fifth of the joint family property, which was, as a matter of fast, at the date of the partition only the house which was mortgaged by defendant 6 and defendant 3 on 20th February 1930. The plaintiff claimed that this mortgage (sic) was fraudulent of himself and his creditors. He also claimed that a mortgage subsequently executed by the sons and the other wife of defendant 6, in favour of defendant 1, the son in law of the defendant 6, was also fraudulent of the creditors. The plaintiff claimed that even though the mortgage purported to be executed for an amount of Rs. 4,000 --Rs. 2300 alleged to have been paid to one Bhailal for his dues and Rs. 1,700--being the consideration due to defendant 1, upon previous debts--as a mater of fact there was nothing due to Bhailal or to defendant 1 and that only documents were brought into being at the time when the partition was effected and the mortgage in favour of defendant 1 was executed in order to shield the property of the sons against the creditors. It is true that the debt which the the plaintiff said was due from defendant 6 upon the surety bond was a debt due to him only from defendant 6. It is also true that the decree which the plaintiff ultimately obtained upon the mortgage executed by defendant 6 and defendant 3 was against those two defendants only. But the plaintiff's case was that the first debt was not for legal necessity, but it was not avyavaharik. The second debt was, as a matter of fact, for legal necessity, being incurred for debts due from defendant 6 at the time of the mortgage. The plaintiff said that, consequently, under the pious obligation of a Hindu son to pay the debts of his father which are not avyavaharik, the joint family property of defendant 6 and his sons was liable for the debts due to him, and the partition was effected in order to save the shares of the sons and the other wife of defendant 6 from the claims of the plaintiff and other creditors.

5. The contentions of defendant 1 who is the principal contesting defendant, was that it was not true that the partition was effected and a mortgage executed in his favour by the sons and the other wife of defendant 6 in order to defraud the plaintiff or other creditors. Defendant 1 said that he had paid in cash Rs. 2,300 to Bhailal, the creditor of the family, on the date upon which the mortgage in his favour was executed, and he said that the remaining consideration was in respect of monies already borrowed by defendant 6 from him upon a promissory note dated 22nd February 1936.

6. The learned trial Judge came to the conclusion that the plaintiff was a creditor of defendant 6 in respect of both the debts. He said, however, that the other sons were not parties to the suits which had been filed by the plaintiff. Defendant 3 was a party to the suit upon the mortgage of 20th February 1930, but the other sons were not parties even to that suit. He said that, at the time when the plaintiff filed his present suit, a suit against the sons in respect of the liability of defendant 6 upon the mortgage bond was barred by time. A suit by the plaintiff against the other sons upon the mortgage was in time because of an acknowledgment dated 22nd December 1938, written by defendant 6 which amounted to a promise in writing to pay a time, barred debt, bat all the same he nonsuited the plaintiff because it was his view that the partition was a bona fide partition. He said that so far as the liability of defendant 6 under the surety bond was concerned, no one thought at the time when the partition was effected that there would be any deficit after the property which was mortgaged by Mahalaxmi to the plaintiff was brought to sale. He said, secondly that so far as the mortgage executed by defendant 6 and defendant 8 in favour of the plaintiff was concerned, arrangement was made by the partition deed for the payment of the mortgage. He, therefore, came to the conclusion that the plaintiff had failed to establish that the transactions of partition and mortgage in favour of defendant 1 were fraudulent.

7. Now, members of a Co-parcenary family under the Mitakshara law are entitled, at any time they so choose, to put an end to the joint status among themselves, and a partition does not become fraudulent merely because it is effected even pending a creditor's suit. It is, however, a transfer, and in case it is shown that the partition, for example, was unfair to the creditor inasmuch as where the debt was due only from one member it assigned to that member property which was of less value than his proper share in the joint family property, then the transfer could be said to be in fraud of that particular creditor. Similarly, where there was a body of creditors, if it could be shown that the transfer was fraudulent of those creditors in this sense, then the plaintiff would be entitled to avoid the partition in a suit filed by him on behalf of himself and other creditors. In this case, it was contended before us by Mr. Shah, who appears for the plaintiff, that the partition was fraudulent on the ground that Mahalaxmi was not given a share at the time of the partition. The partition was actually effected on 25th May 1933. It appears from the evidence that Mahalaxmi died in September 1937. It is obvious, therefore, that there is no substance in this contention. But there is substance in the contention that even so the plaintiff was entitled to avoid the partition, because, notwithstanding what the learned Judge says, arrangements were not made for the payment of the debts due under the mortgage of 28th February 1930. It is true that this mortgage was executed by defendant 6, only on behalf of himself and defendant 3.

It has been found now that other sons were also born at the time of the mortgage. But all the same, it was not necessary to make the other sons parties because the family was a joint family at the time of the mortgage. The plaintiff's case was that the money which was taken by defendant 6, upon this mortgage was in respect of an antecedent debt. This was accepted in the suit which was filed by the plaintiff against defendant 6 and defendant 3. It is true that the other defendants are not bound by the finding in that suit that the mortgage was binding upon them being for an antecedent debt, but the plaintiff has in this case produced before us the earlier bond, an there can be no doubt that the debt in respect of which the mortgage was passed was, in point of fact as it was in point of time, anterior to the mortgage. In that case, the mortgage was binding upon all the sons of defendant 6. The partition, therefore, had to provide for the payment of this debt. Now the learned advocate who addressed us on behalf of defendant 1 says that there is provision in the partition deed for the payment of this debt, because the partition deed mentions that Rs. 1,500 were due upon the mortgage and it says that this amount will be recovered by the creditor from the one-fifth share which was given to defendant 6 under the partition. But the property which was the subject matter of partition was valued by the parties to the partition and its value was mentioned in the partition deed at the time of the partition as Rs. 5,500. The one-fifth share which was given to defendant 6 was, therefore, worth in value Rs. 1,100 and it is obvious that it could not be said that provision had been made for the payment of the mortgage debt when what the partition contemplated was that the plaintiff would recover the whole of the amount from the share of defendant 6, which was worth only Rs. 1,100. That, however, would only affect the question in so far as anything specific was alleged to have been given to the share of defendant 6. We do not wish to go into this case whether any such specific portion of the house which was mortgaged was given to defendant 6 by the partition deed. Suffice it to say that in so far as the partition put an end to a joint family status and in so far as it determined the shares of each one of the shares as that thereafter they held the properly in definite shares of one fifth of the property each, it cannot be said that the partition was objectionable and was fradulent. It is open to the parties to arrive at that type of partition, and it could not possibly defraud the creditors of any one of the shares, and such creditors would be entitled even after the partition to pursue remedies against the shares of the other sharers.

8. The next question which arises is whether it has been shown that the mortgage of 14th June 1938, was in fraud of the creditors. It is true that if we maintain that the partition, in so far as it put an end to the joint status was not fraudulent, the plaintiff would be entitled to look to the shares of the sons for the satisfaction of his debt, he cannot do that if after the partition property is conveyed by one or more of the sharers to a third person. That is because even if the plaintiff is entitled to recover his debt from the shares of the sons in the joint family property, no charge is created upon those shares in the absence of a decree specifically creating such a charge.

[After discussing evidence his Lordship proceeded.] On the whole, therefore, we are satisfied that the transaction of mortgage, dated 14th June 1938, between the sons and the other wife of defendant 6 and defendant 1 was a transaction fraudulent of the creditors.

9. The question which arises, however, in this case is : even so, what would be the relief to which the plaintiff is entitled It is not in dispute now that the plaintiff has been paid the amount due upon the mortgage of 20th February 1930, after he filed the present suit. He obviously cannot get, therefore, a declaration that the sons' interest is liable to be sold in execution of the decree which he obtained upon the mortgage. He may get a declaration, inasmuch as he was a creditor at the date of the suit, that the transactions were fraudulent. There is another declaration which he wants, and it is that the transaction of mortgage was fraudulent. There is a farther declaration which he wants, and it is that the son's shares are liable to be brought to sale in the execution of the personal decree which he obtained against defendant 6 in the suit against him and Mahalaxmi.

10. Now, at the date when the plaintiff filed his present suit, any suit by him against the sons for the debt due from Mahalaxmi was barred by time. In any case, it has not been shown to us that it was, as a matter of fact, in time. The liability of defendant 6 was under his surety bond. There was no liability incurred by him under the mortgage because he did not execute the mortgage. What the surty bond stated was that in case Mahalaxmi did not pay the amount, defendant 6 would pay it himself. Now, the cause of action in a suit against defendant 6 in respect of the debt which is still due to the plaintiff in respect of the mortgage transaction between him and Mahalaxmi arose, therefore, on the date upon which Mahalaxmi failed to pay the amount of the mortgage money. That obviously must have been before the date of the suit which the plaintiff filed against Mahalaxmi. This suit he filed on 3rd December 1934. The cause of action against the sons for a suit in respect of the same debt would be the same as the cause of action which the plaintiff had against the father. Because even though there has been a dispute between the various High Courts as to the period of limitation against the sons, it has generally been accepted that the cause of action in a suit against the father and in a suit against the sons is the same. Now, inasmuch as the cause of action against defendant 6 in respect of the debt due from Mahalaxmi arose before the date of the previous suit, by the time the present; suit was filed any suit against defendant 6 would obviously have been barred. So far as the sons are concerned, two cases are to be considered : is the period of limitation in a suit where there is no mortgage passed by the father or no charge created by the father on the joint family property three years, or six years under Article 120, Limitation Act But in case it is the plaintiff's case that the present suit is in time, then the plaintiff has to show that the cause of action for the suit in respect of the debt which Mahalaxmi did not pay arose six years before the date of the filing of the present suit, which was 5th October 1939. The plaintiff did not show that, as a matter of fact, the failure of Mahalaxmi to pay arose more than six years before the date of the present suit. The learned advocate who appears on bahalf of the plaintiff argued before us that the cause of action in, this case arose when the property was sold and when in the year he realised that there would be a deficit. But we fail to understand that the sale or the deficit has anything to do in the matter. When the cause of action arises depends upon the terms of the bond, which specifically stated that defendant 6 would pay if Mahalaxmi did not pay. The cause of action, therefore, started upon the failure of Mahalaxmi to pay.

11. It is contended, however, on behalf of the plaintiff that even if on the date upon which the present suit was filed a suit against the sons would have been barred by time, inasmuch as the plaintiff has obtained a decree against defendant 6, the plaintiff is entitled now to sue for a declaration that in execution of the decree the sons' interest is also liable to be brought to sale irrespective of any question as to whether at the time when the present suit was filed the plaintiff would have been able to obtain a decree for the debt against the sons. In support of this contention, reliance is placed on a ruling of this Court in Ramohandra v. Annaji 45 Bom. L. R. 1037 : : AIR1944Bom59 . The judgment is that case was given in similar circumstances, and Lokur J., who delivered it, upheld the case of a plaintiff who was suing the son for recovery of a debt due to him from the father long after a suit by the plaintiff against the son was barred by time. upon the view that when the suit is for a declaration that the decree against the father may be executed against the son's interest there can be no objection to give that relief irrespective of the question of limitation. He relied upon the principle pointed out by Hill J. in Nitayi Behari v. Hari Govinda 26 Cal. 677 which is a recognised principle (p. 1043):

'That a decree-holder may sue to have it declared that the interests of third persons may be made liable for the satisfaction of a decree made in a suit to which they were not parties, although the decree was one in execution of which ordinarily the rights and interests of the judgment debtor alone could be disposed of.'

And he cited as a simple illustration of the application of this principle the case of Mathura Prasad v. Ramchandra 25 ALL. 67 : 1902 A. W. N. 190. What we are concerned with in the present case is the position of a creditor who wishes to execute a decree which he obtained against the father, after the date of partition. The case is not merely that of a partition having intervened between the date of the decree and the date upon which execution was sought. The decree itself, as a matter of fact, was obtained after there was a partition between the father and the sons. The question which arises is as to whether the remedy of a suit for recovery of the debt against the son not being available to the plaintiff, he can sue for a declaration that the decree obtained by him against the father after partition can be executed without a suit for recovery of the debt against the sons. We have no doubt that the principle which was stated by Hill J. in Nitayi Behari v. Hari Govinda 26 Cal. 677 is with respect, a correct principle. But the learned Judge stated that principle in connection with a case in which the plaintiff's were represented in the suit as a result of which their property was sold by the defendant on the record of that suit. In Nitayi Behari v. Hari Govinda 26 Cal. 677, the plaintiffs sought to set aside the sale of Shikmi taluka, or in the alternative for a declaration that the sale did not affect their rights, on the allegation that defendants 3 and 4 who were the proprietors of a certain share of the estate under which the said taluk was held had obtained a collusive decree for arrears of rent for the years 1298 and 1299 (B. S.) against defendant 1 who was a joint owner of the taluk with the plaintiffs, and in execution thereof fraudulently caused the disputed property to be sold, which defendant 1 purchased in the name of defendant 2. The defence (inter alia) was that the sale was not brought about by fraud or collusion, and that the rent suit having been brought against the registered tenant defendant 1, the whole tenure passed by the sale. It was held in that case, one of the Judges dissenting that--

'inasmuch as it appeared that the share sold away stood in the name of defendant 1 alone ; that the zemindar used to sue defendant 1 for rent for the said share ; that defendant 1 used to realize a rateable share of costs, road cesses, etc., which he was bound to pay under rent decrees obtained against him from the plaintiffs sometimes amicably and generally by contribution suits; and that defendants 3 and 4 who were the fractional shareholders of the zemindari sued defendant 1 as usual for rent for the years 1298 and 1299 (B.S.) and obtained a decree, the sale though in terms only a sale of the right, title and interest of the judgment debtor, really passed the right, title and interest, not only of the registered tenant, but also of the unregistered co-owners whom he represented.' The question in that suit was: what passed at that auction sale That, in its turn, involved the question as to whom the registered tenant represented. Did he represent himself or the unregisted co-owners who, so to speak, came under him The view which was taken was that, in view of the facts which I have mentioned above, the registered tenant represented also the unregistered co-owners and consequently the decree which was obtained against the registered tenant could also be executed against the unregistered co-owners. It is true that, when stating the principle, Hill J. did not confine it to a case where the declaration sought was that the decree could be executed against persons represented by the defendants. But all the same, it must not be ignored that the principle was applied to a case in which the decree was obtained against the defendant in his representative capacity, and what was held was that what passed at the auction-sale was not only the share of the actual tenant but of everyone whom he represented.

12. This case was followed by the Allahabad High Court in a later decision which also Lokur J. quotes. But in that case, there was a decision upon a preliminary point by a trial Court, in which a simple money decree had been obtained by a creditor against one Sarju Prasad. In execution of that decree the decree holder attached certain property as that of Sarju Prasad, but the latter's sons raised objections and got the property released from attachment. The decree holder thereupon filed a suit against them for a declaration that the property in question was liable to attachment and sale in execution of his decree. It was contended by the defendants that they had separated from Sarju Prasad twenty years previously and the debt was not binding on them. The trial Court dismissed the suit as not maintainable, sustaining the preliminary objection to the effect that the plaintiff ought to have made the defendants parties to his original suit if he wanted to bind them. Lokur J. stressed that the High Court held that such a suit would lie, and that it was no bar thereto that the plaintiff had omitted to make the sons parties to his original suit. To that obviously no objection can be taken. But it is not as if, after a finding was recorded that the sons had separated from Sarju Prasad twenty years previous to the incurring of the debt, the Court held that there still was no objection to the suit that the sons had not been made parties to the suit against Sarju Prasad. Inasmuch as the trial Court had upon a preliminary issue and without investigating the facts straightway dismissed the suit holding that the sons were not made parties to the previous suit, it was held that the dismissal must be set aside; and that was obviously on the ground that in case there was no partition between the father and the son as the defendant contended the father would represent the sons at the time when the debt was incurred and even afterwards till there was a partition he would represent the sons. In such a case, the suit for a declaration that the decree which was obtained against the father could be executed against the sons would succeed because when the decree was obtained the father would represent the sons as there was no partition. In the same case, reference was made to an earlier case of the Allahabad High Court. The case of Dharam Singh v. Angan Lal 21 ALL. 301: 1899 A.W.N. 78 merely stated that even if the creditor had not impleaded the son in his previous suit, his omitting to do so does not deprive him of his subsequent remedy against the son. No question of limitation was involved in the case and all that was held was that even if the decree was obtained against the father, it was open to the father's creditor to establish the son's obligation to pay his father's debt. In the case of Mahammad Askari v. Badhe Bam Singh 22 ALL 307: 1900 A.W.N. 73 'The plaintiff sued B and M, alleged to be the managing members of a joint Hindu family, for sale upon four mortgages executed by them in respect of property owned by the joint family and obtained a decree in 1894. He brought the present suit against defendants 1 to 15, other members of the same family, said to be the brothere, brother's sons and cousins of B and M, claiming enforcement of the same mortgages against the said defendants by sale of their interests in the mortgaged property. Held, that the cause of action against defendants 1 to 15 on the mortgages in suit was not merged in the decree of 1894, and that the suit against them is not barred.'

All that was held, therefore, in the earlier cases of Allahabad High Court, was that notwithstanding the fact that some of the persons who were liable were not made parties to the earlier suit, a suit could be filed against them later and a decree passed in case they were so liable. The principle which was stated, therefore, in the case of Nitayi Behari v. Hari Govinda 26 Cal. 677 and in the case of Mathura Prasad v. Ramchandra Rao 25 ALL. 57: (1902) A. W. N. 190 must be confined to those cases in which a declaration is sought that the decree can be executed against persons who were not parties to it, on the ground that the defendant represented them. Such a contention cannot obviously be made in the case of a decree obtained against the father after his partition from the son even in respect of a pre-partition debt binding upon the son. It is quite true that the pious obligation of a son to pay the debt of his father does not come to an end by the mere fact that the creditor has sued the father and obtained a decree. It can come to an end only when the decree is satisfied: but it does not follow that the obligation can be enforced much less that it can be enforced in execution of the decree obtained against the father. Just as the effect of a rule of limitation may be that a right remains, though the remedy is barred similarly, upon the application of the rule, the obligation of the son may remain, though there may be no way known to law of enforcing it.

13. The plaintiff will not, therefore, get the declaration in respect of the debt due to him from defendant 6 for Mahalaxmi's mortgage dues.

14. The decree of the trial Court will, therefore, be modified and the plaintiff will be given a declaration that the partition was fraudulent in so far as it did not make any provision for the payment of the debt due upon the mortgage of February 1930. He will also be given a declaration that the mortgage in favour of defendant 1 was fraudulent of the creditors.

15. The plaintiff has, however, failed with regard to the claim of the debt due from defendant 6 for Mahalaxmi's mortgage amount. Each party will, therefore, bear its own cost throughout.


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