(1) This second appeal arises out of a suit filed by three plaintiffs to obtain a declaration that a sale-deed dated 26-5-1936, executed by defendant 3, who is the lather of plaintiffs 1 and 2 and the husband of plaintiff 3, was not binding upon their interest in the suit property which is a house situated at Ahmednagar. The circumstances giving rise to the suit are shortly these.
(2) The house in suit originally belonged to a family of three brothers, of whom defendant 3 was one. There was a partition in the year 1932 between the three brothers and at this partition the family house fell to the share of defendant 3. The evidence shows that at the partition defendant 3 obtained property worth about Rs. 40,000. It appears that defendant 3 was then a minor and the property which fell to his share was managed by trustees who made over possession to defendant 3 in or about the year 1034. The fact of handing over possession is evidenced by a receipt which is produced in the case. It also appears from the evidence that during the time the trustees were in management a business called a 'cloth business' was being carried on on behalf of defendant 3.
(3) On 2-12-1935, that is to say, after defendant 3 attained the age of majority, he executed in favour of defendants 1 and 2 a mortgage for the consideration of Rs. 5,000 and by this mortgage he gave as security the house in suit. On 21-1-1936, he effected a second mortgage in relation to the same property in favour of defendants 1 and 2 for the consideration of Rs. 2,000. On 3-3-1936, he effected a third mortgage in relation to the same house in favour of defendants 1 and 2 for the consideration of Rs. 3,000. It is obvious that the total consideration of these three documents was a sum of Rs. 10,000.
(4) Plaintiff I was born on 23-5-1936, and plaintiff 2 was born in the year 1039. On 4-4-1940, the two plaintiffs and their mother, plaintiff 3, filed this suit to obtain the aforesaid declaration. The basis of the plaintiffs' claim was that the sale-deed executed in favour of defendants 1 and 2 did not affect their right, title and interest in the suit house, notwithstanding the sale-deed executed in favour of defendants 1 and 2 on 26-5-1936.
(5) Defendants 1 and 2 resisted the plaintiffs' suit and raised various contentions. One of the principal contentions was that the sale-deed dated 26-5-1936, was binding upon the plaintiffs because that sale-deed was executed either for legal necessity or for the payment of antecedent debts.
6. The trial Court raised a number of issues and held that plaintiff 1 was entitled to a declaration that he had a half share in the suit house and that his share was not affected in any way by the sale-deed dated 26-5-1936. It is to be observed that the trial Court also came to the conclusion that no connection was proved between the various alienations and the alleged immorality of defendant 3, and also the conclusion that the sale-deed was not justified either by legal necessity or for the payment of antecedent debts. From the decree made in the suit defendants 1 and 2 preferred an appeal in this Court and this Court, by its order, dated 26-7-1946, held that the appeal was not competent and directed the same to be presented to the proper Court. The appeal was then presented in the District Court, Ahmednagar. While the appeal was pending in this Court, plaintiff 1 died and plaintiffs 2 and 3 and defendant 3 were substituted as his heirs and legal representatives. When the appeal was presented in the District Court these plaintiffs and also defendant 3 were shown upon the record of the appeal as heirs and legal representatives of deceased plaintiff 1. At the hearing of the appeal before the Civil Judge, S.D., with appellate powers, it was contended that inasmuch as plaintiff 1 died pending the appeal, the cause of action did not survive to the surviving plaintiffs and defendant 3 because the right of plaintiff 1 to question the alienation of the father was a personal right. The lower appellate Court came to the conclusion that the right was not a personal right but that the right was a right to property. In this case plaintiff 1 died pending the hearing & final disposal of the appeal preferred by defendants 1 and 2. Prior to that, there was a decree in favour of plaintiff 1 and by the decree the Court declared that plaintiff I had a half share in the suit property and that the suit property was unaffected by the sale-deed executed in favour of defendants 1 and 2 on 26-5-1936. Mr. Rege who appears for the appellants argues that the right was a personal right. It seems to me that the contention is not well founded. The property in suit is a house which was ancestral property. By birth plaintiff 1 had an interest in this property and that interest was independently of his father, defendant 3. It was this interest which he acquired by birth and which he asserted by the suit which he brought against defendants 1 and 2. By the trial Court's decree his interest was declared to have been unaffected by the sale-deed of 26-5-1936. It is obvious that the interest which plaintiff 1 claimed was an interest in the family property and by the decree the trial Court declared that the interest of plaintiff 1 had remained unaffected by the sale-deed of 26-5-1936. It seems to me, therefore, that the learned appellate Judge was right in holding that the right claimed by plaintiff 1 was not a personal right. The first contention, therefore, fails.
7. It was contended in the trial Court as well as in the Court of first appeal that the money raised by the three mortgages as also by the sale-deed was raised by defendant 3 for immoral purposes. Now, the trial Court as well as the Court of first appeal came to the conclusion that no connection was established between the loans and the alleged immorality of the father. In order to succeed in this contention it is necessary for the plaintiffs to establish that there was a connection between the loans and the immorality of the father. That connection not having been established, it seems to me that the lower Courts were right in holding that the loans were not raised for purposes of immorality as alleged by the plaintiffs.
8. This leads me to the principal question which is argued in this appeal, viz. whether the sale-deed dated 26-5-1936, is binding upon plaintiff 1. Now, so far as plaintiff 1 is concerned, the evidence shows that he was born on 23-5-1936. The alienation, took place on 26-5-1936, so that at the date of the alienation plaintiff 1 had been in existence and by his birth he had acquired an interest in the family property. Both the Courts have come to the conclusion that plaintiff 1 was born on 23-5-1936. But apart from this, plaintiff 1 will be entitled to question the several alienations, provided he was born on 23-5-1936, or on any other date before 26-5-1936. The earliest transaction is of 2-12-1935, so that if plaintiff 1 could show that at the date of the several alienations he had been conceived, then in that event he would be entitled to question the alienations made by his father. Apart from this, both the Courts have come to the conclusion that plaintiff 1 was born on 23-5-1936, and sitting in second appeal, I am bound by that finding. On this footing, therefore, plaintiff 1 would be entitled to question the alienation of his father, defendant 3.
9. The case of plaintiff 2 is different. Plaintiff 2 was born in the year 1939, and since the alienation had taken place some three years prior to the date of his birth, plaintiff 2 would not be entitled to question the alienation made by his father, defendant 3. That was the view taken by the lower Courts and I think that view is right.
(10) The case of plaintiff 3 is slightly different. Plaintiff 3 is the mother of plaintiffs 1 and 2 and the wife of defendant 3. She would have no interest in this property unless there is a partition between her sons, in which case at the time of the partition she would be entitled to a share equal to that of a son. In this case that question does not arise and, therefore, plaintiff 3 would have no interest in this property. The result is that the validity of the alienations has to be considered with reference to the interest of plaintiff 1.
11. Now, it is urged on behalf of the appellants that the alienation can be supported both on the ground of legal necessity as well as on the ground of antecedent debts. Before I deal with this question, it is necessary to mention some of the facts. Defendant 3 appears to have come from a well-to-do family. At the partition of 1932 he got property worth about Rs. 40,000. The evidence shows that the father of defendant 3 had inherited a large estate from one Navalmal Gulabchand of Ahmednagar and it is indisputable that at the partition of 1932 defendant 3 had obtained property worth about Rs. 40,000. This was in the year 1932. Defendant 3 appears to have attained the age of majority in the year 1934. He was then 18 years of age and thereafter he appears to have embarked upon a series of alienations which, according to defendants 1 and 2, were for the purposes of the cloth business carried on by defendant 3. It is to be remembered that this cloth business was not ancestral business of the family. The learned trial Judge said that it was an ancestral business but it has been conceded at the bar that there is no evidence to show that this business was ancestral business. If it was ancestral business, then it would have been possible to show that by reference to the partition which took place in the year 1932. But no evidence in that sense has been pointed out to show that the business was an ancestral business. The evidence shows that this cloth business was carried on during the lime defendant 3 was a minor and the business was handed over to defendant 3 after he attained the age of majority in the year 1934, It is clear, therefore, that this business was started as a new business after the partition of 1932, and it is relevant to consider the extent of the property which defendant 3 got at the partition of 1932. At this partition defendant 3 got the house in suit. He also got gold ornaments weighing 250 tolas. The learned trial Judge put the value at Rs. 10,000. He put the value of the house at Rs. 13,000. Defendant 3 also got shares and securities of the value of Rs. 4,000. It is clear, therefore, that at the time when defendant 3 obtained possession of his property he was possessed of substantial means, and apart from the business which he carried on, there was no necessity whatever for entering into the several transactions which I am about to mention.
(12) In the first place, there is the simple mortgage of 2-12-1935. The consideration of the mortgage is said to be Rs. 5,000. The mortgage deed mentions two years as the period of repayment. The consideration mentioned in the mortgage deed consists of two items of Rs. 2,500 and Rs. 2,500 and it is recited in the mortgage deed that the first sum of Rs. 2,500 was for the purpose of making payment of a debt due to Sheshmal Balmukund, a shop at Bombay. In the concluding part of the mortgage deed it is recited that the aforesaid sum was taken by defendant 3 for his business purposes. The next mortgage is of 21-1-1936. It was to secure a sum of Rs. 2,000. The period of repayment is the same and the mortgage deed recites that Rs. 2,000 were taken by defendant 3 for his business purposes. The last mortgage is of 3-3-1936. The period of repayment was two years. The amount secured was Rs. 3,000 and the mortgage deed recites that the sum was taken by defendant 3 for his business purposes. Then I come to the important alienation of 26-5-1936. That deed was executed by defendant 3 and the consideration was a sum at Rs. 15,000 composed of three items: (1) Rs. 10,285-4-0 due upon the three mortgages, (2) Rs. 500 which defendant 3 took by way of earnest in pursuance of an agreement of sale and (3) Rs, 4,214-12-0 which defendant 3 received from defendants I and 2 under a cheque. Substantially, therefore, the sale-deed was executed for consideration consisting of two parts: (1) a sum of Rs. 10,285-1-0 due in respect of the previous mortgages and (2) a cash advance of a sum of Rs. 4,714-12-0. The learned trial Judge said that the mortgages did not mention the purpose of the loan. It seems to me that that statement is not correct. In the first mortgage the purpose is mentioned which is the payment of a debt due to Sheshmal Balmukund a shop at Bombay, and the other purpose is that the money was required for the business of defendant 3. This last purpose is common in all the three documents. The learned trial Judge came to the conclusion that the alienation cannot be supported on the ground of legal necessity and that view was concurred in by the lower appellate Court. Now, the business which defendant 3 started was not an ancestral business. That, business was not joint family business either. It was a business started by the trustees and which was taken over by defendant 3 after he attained the age of majority. The Courts below have come to the conclusion that the alienation cannot be supported on the ground of legal necessity, and it seems to me that, apart from the finding which is a finding of fact, the conclusion is correct. The monies were borrowed obviously for the purpose of extending the business newly started by defendant 3. Such a purpose would not constitute a justifying purpose so as to be binding upon plaintiff 1. It is to be noted that defendant 3 had obtained at the partition property worth Rs. 40,000 and there could be no necessity for the purpose of entering into these alienations because defendant 3 had obviously been possessed of means sufficient to meet the expenses of his family. His family then consisted of himself, his wife and a child. It seems to me, therefore, that the Courts below were right in coming to the conclusion that the alienation of 26-5-1936, was not supported by legal necessity.
(13) But it is argued that the alienation can be supported on the ground of payment of antecedent debts. The law bearing upon the point has been laid down by their Lordships of the Privy Council in the case of -- 'Brij Narain v. Mangla Prasad', AIR 1924 PC 50 (A). The law has been stated in five propositions, four of which may be set out here:
'(1) The managing member of a joint undivided estate cannot alienate or burden the estate qua manager except for purposes of necessity; but
(2) If he is the father and the other members are the sons he may, by incurring debt, so long as it is not for an immoral purpose, lay the estate open to be taken in execution proceeding upon a decree for payment of that debt.
(3) If he purports to burden the estate by mortgage, then unless that mortgage is to discharge an antecedent debt, it would not bind the estate.
(4) Antecedent debt means antecedent infact as well as in time, that is to say, that thedebt must be truly independent and not partof the transaction impeached.'
When analysed, the legal position stands in this way. Proposition I defines the power of a managing member of a joint Hindu family, the power being limited to make an alienation or to create security only for the purposes of necessity. Proposition 2 is concerned with the liability of a son and that liability can be enforced against the estate upon a decree obtained by the creditor upon a loan incurred by the father. Propositions 3 and 4 are to be read together. Proposition 3 is concerned with the power of a father to create a mortgage and the mortgage would be valid where the mortgage is executed for the payment of an antecedent debt and proposition 4 defines what an antecedent debt means and the debt to be antecedent must be antecedent in fact as well as in time. In other words to make a debt antecedent it must be truly independent of the transaction impeached. The total consideration under the three mortgages was a sum of Rs. 10,285-4-0. This would be an antecedent debt within the meaning of propositions 3 and 4. The alienation took place on 26-5-1936, and the amounts secured by the mortgages were borrowed on 2-12-1935, 21-1-1936, and 3/3/1936. These debts were antecedent in time and they were antecedent in fact also. Mr. Nijsure seemed to suggest that a previous mortgage cannot constitute an antecedent debt in respect of a subsequent mortgage executed by the father. It seems to me that 'Brij Narain's case' (A) is a complete answer to this contention. In 'Brij Narain's case' (A) there were two mortgages executed respectively on 12-12-1905, and 19-6-1907 & the father executed a third mortgage on 4-3-1908, to pay off the two earlier mortgages, and it was held that the first two mortgages constituted antecedent debts. With respect, I follow this principle and hold that the first part of the consideration constituted an antecedent debt, so that the alienation would be binding upon the sons, if the alienation had taken place only for the purpose of payments of the antecedent debt. But in this case there is a difficulty in the way of defendants 1 and 2. By the sale-deed of 26-5-193G, defendant 3 received a sum of Rs. 4,714-12-0 from defendants 1 and 2. In the sale-deed the purpose respecting the sum of Rs. 500 and the purpose about the sum of Rs. 4,214-12-0 are not mentioned. It is obvious that these two amounts were received for the personal benefit of defendant 3. The transaction cannot be one for the payment of antecedent debts in regard to these two items because the two amounts were received on the date of the sole-deed. There was, therefore, no antecedence in fact as well as in time. It is not suggested, nor indeed is there any evidence upon the point, that these two sums were for a justifying necessity. On the footing, therefore, that the sale-deed was executed for consideration composing of two parts, the question arises whether the sale in favour of defendants 1 and 2 is justified. The learned appellate Judge relied upon a passage as now set out in Section 297 of Mulla's Principles of Hindu Law, 11th edn., p. 394. That passage is in the following terms:
'It sometimes happens that joint family property is sold by the father of a joint family for the payment 'of an antecedent debt, but the whole of the price is not proved to have been 'applied' in payment of such debt, and the sale is challenged by the sons on that ground. In such a case, if the sale was necessary to discharge the debt, and the purchaser pays a fair price for the property sold, and acts in good faith and after due inquiry as to the necessity for the sale, the mere fact that part of the price is not proved to have been applied in payment of the debt does not invalidate the sale, the reason being that the purchaser is not bound to see to the 'application' of the price. If the above conditions are satisfied, the sale must be upheld unconditionally, whether the part not proved to have been applied in payment of the debt is considerable or small.'
This passage shows that the property sold by the father must be for the payment of an antecedent debt. In this case the house in suit has not been sold by the father only for the purpose of payment of an antecedent debt. It is true that nearly two-thirds of the consideration have gone to discharge the indebtedness of the father and nearly a one-third of the consideration of the sale-deed was a cash advance which was taken by defendant 3 for his personal benefit and in such a case tile question arises whether the sale was justified. Now, the case of an antecedent debt stands on the same footing as legal necessity and the principle as regards the question of the justifying nature of an alienation for a legal necessity has been considered in the case of -- 'Raghunath v. Ram-chandra', AIR 1939 Bom 396 (B). A part of the head-note is in the following terms:
'If the alienation challenged is a sale, it would not be set aside if a substantial portion of its consideration was required for a legal necessity, or for the benefit of the family, or to pay off an antecedent debt which was not immoral or illegal, although the remaining portion was not so required. The material question in such cases is whether the sale itself was justified, and, if so, the sale will be upheld as a whole.'
(14) Applying this principle to the facts of the present case, can it be said that in this case the sale itself was justified? In this connection the facts are that the three mortgage were executed some six months prior to the date of the alienation which is 26-5-1936. Under the mortgages the period of repayment was a period of two years. Defendant 3 received a sum of Rs. 4,714-12-0 which is not suggested to have been raised for the purpose of legal necessity or for the payment of an antecedent debt. The lower appellate Court found that the price paid was a fair price. The lower appellate Court also found that there was no necessity whatever for defendant 3 to effect the sale. There was no pressure upon defendant 3 and indeed there could not be any. The amounts due under the three mortgages had not become due. Although, therefore, the three mortgages constituted antecedent debts, I am unable to hold that the sale itself was justified. Mr. Rege argues that the sale-deed is good as regards the consideration of Rs. 10,285-4-0 which is the major part of the consideration of the sale-deed. That, no doubt, is a circumstance in favour of defendants 1 and 2. On the other hand, there is a substantial sum of Rs. 4,714-12-0 which was taken by defendant 3 for his own personal benefit, and if the question is whether the sale itself was justified, I am unable to held that the sale could be justified because there was no pressure upon defendant 3 for the payment of the debts, the period of repayment had net expired and the mortgages had been executed shortly before six months from the date of the sale-deed dated 26-5-193G. It is for defendants 1 and 2 to show that the sale itself was justified, and in view of the circumstances which I have mentioned above, I cannot hold that in this case the sale could be justified. Mr. Rele, supplementing the argument of Mr. Rege, relied upon the case of -- 'Masit Ullah v. Damudar Prasad', AIR 1926 PC 105 (C) and he said that in this case the sale must be held to be a justified one. A part of the head-note in that case is in the following terms:
'The son of a Hindu governed by the Mitakshara sued to set aside a sale for Rs. 13,400, of joint family property by his father, who was made a defendant. It appeared that the whole of the consideration, except about Rs. 2,000, had been applied by the father to discharge mortgages made by his grandfather. There was no evidence that the balance had been used by the father for immoral or unauthorised purposes:--
'Held', that the suit should be dismissed, as the plaintiff was liable for his great-grandfather's debt, and the father, who was in collusion with his son, had deliberately withheld his evidence which would have shown how the rest of the consideration had been applied.'
It appears from the facts of that case that the consideration was a sum of Rs. 18,400 and the evidence showed that a sum of Rs. 2,000 had dot been shown to have been applied for payment of the debts. In this case the facts are different. The sale-deed itself shows that the first item of Rs. 10,285-4-0 was the amount due in respect of the three earlier mortgages. The sale-deed also shows that the sum of Rs. 4,714-12-0 was a cash advance. This is, therefore, a case where part of the consideration was for the payment of antecedent debts and part was for the personal benefit of defendant 3. If that is so, it seems to me that the principle laid down in -- 'Masit Ullah's case' (C) cannot apply to the facts of the present case. In conceivable circumstances it is possible to upheld a transaction where, for example, a substantial part of the consideration is either for the payment of antecedent debts or for a justifying necessity and only a small portion is not shown to have been expended for one or the other purpose. But where, as in this case, a sum of Rs. 4,714-12-0 was admittedly borrowed for the personal benefit of defendant 3, I am unable to hold that the sale itself could be justified. That was the view taken by the Court below and I think that view is right.
(15) For the above reasons, the decree appealed from is correct and this appeal will be dismissed with costs in one set.
(16) Appeal dismissed.