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Shafia Begum Kom Mahmad Sahib MomIn Vs. Bashir Ahmed Maulvi Mahmed Hanif - Court Judgment

LegalCrystal Citation
SubjectFamily;Arbitration
CourtMumbai High Court
Decided On
Case NumberSecond Appeal No. 148 of 1958
Judge
Reported in(1962)64BOMLR462
AppellantShafia Begum Kom Mahmad Sahib Momin
RespondentBashir Ahmed Maulvi Mahmed Hanif
DispositionAppeal dismissed
Excerpt:
mahomedan law - arbitration act (x of 1940), section 32--guardian--whether de facto guardian has power to incur loans and refer disputes arising therefrom to arbitration--court whether in suit or petition to set aside award can examine whether de facto guardian has exceeded power to incur loans.;under mahomedan law a de facto guardian has power to incur loans in case of emergency or distress and he has also the power to refer the dispute that arises in respect of such loans to arbitration.;an enquiry whether a de facto guardian has exceeded his power to incur loans is not only foreign to a suit, but, it is beyond the scope of the enquiry for setting aside the award under section 32 of the arbitration act, 1940. the only question that can be considered is whether the de facto guardian had..........that suit was suit no. 650 of 1940. after the death of mahamad saheb, sahebbi became the de facto guardian of her minor children. sahebbi had to borrow loans for the maintenance of her children and for financing the litigation from one khansaheb moulvi mahamad hanif, the father of defendants nos. 1 to 4. this was in the year 1939-40. sahebbi died in the year 1941 or 1945 (there is no definite evidence on the point). her father, imam saheb, began to act as de facto guardian of the minor children after the death of sahebbi. imam saheb died and his son, abdul gam, the brother of sahebbi, became the de facto guardian. it was abdul gani, who was appointed guardian and next friend of the minors in suit no. 650 of 1940. this suit (no. 650/1940) ended in a decree in favour of the present.....
Judgment:

Naik, J.

1. This appeal arises out of a suit filed by the appellants (plaintiffs) against the respondents (defendants) for a declaration that the award decree passed in regular suit No. 230 of 1949 is not binding upon them and for perpetual injunction restraining defendants Nos. 1 to 4 from executing the said decree against the plaintiffs or their property. The material facts may be briefly stated as follows: One Mahamad Saheb had two wives, Jainbi and Saheb-bi; Jainbi being the senior. Mahamad Saheb had a son, Abdul liazak born of Jainbi and two daughters and one son Shafla Begum and Zebunnissa (plaintiffs) and Abdul Kahiman (defendant No. 6) respectively born of Sahebbi. After the death of Mahamad Saheb disputes started between Abdul Razak on one side and Sahebbi on the other. It appears that Abdul Razak usurped the entire property belonging to Mahamad Saheb with the result that Sahebbi had to be a suit on her own behalf and also on behalf of her minor children for partition of the family property. That suit was suit No. 650 of 1940. After the death of Mahamad Saheb, Sahebbi became the de facto guardian of her minor children. Sahebbi had to borrow loans for the maintenance of her children and for financing the litigation from one Khansaheb Moulvi Mahamad Hanif, the father of defendants Nos. 1 to 4. This was in the year 1939-40. Sahebbi died in the year 1941 or 1945 (there is no definite evidence on the point). Her father, Imam Saheb, began to act as de facto guardian of the minor children after the death of Sahebbi. Imam Saheb died and his son, Abdul Gam, the brother of Sahebbi, became the de facto guardian. It was Abdul Gani, who was appointed guardian and next friend of the minors in suit No. 650 of 1940. This suit (No. 650/1940) ended in a decree in favour of the present plaintiffs and defendant No. 6 on May 7, 1946. Dispute started between Abdul Gani as the de facto guardian of the plaintiffs on one side and Khansaheb, the creditor, on the other, regarding the loans, which the latter had advanced to Sahebbi. Ultimately, these disputes were referred to the arbitration of one Bhimashankar on July 31, 1947. The reference was submitted on behalf of the minors by the de facto guardian, Abdul Gani. On August 11, 3948, Bhimashankar gave his award under which he allowed Rs. 4,000 to Khansaheb. He also created a charge on the immovable properties belonging to the minors for the satisfaction of this amount. A suit (No. 230 of 1949) was filed for obtaining a decree on the basis of the award and eventually, a decree in terms of the award was passed in that suit. Plaintiff No. 1, Shafia Begum,, became major on February 24, 1951, and plaintiff No. 2, Zebunnissa became major on July 4, 1952. On November 15, 1954, the plaintiffs filed a suit, which has given rise to the present appeal for setting aside the award. They eon-tended that there was no need for their mother to borrow loans and that, as a matter of fact, no loans were borrowed and the whole arrangement was a collusive one. They also alleged collusion between the arbitrator and their de facto guardian. Some vague allegations of fraud also were made in the plaint. The main point, however, that was urged for setting aside the award decree was that Abdul Gani, who was the de facto guardian, had no authority to refer the dispute to arbitration. The trial Court held that the suit for setting aside the award is not maintainable. It further held that in view of the finding on this issue, it was not necessary to decide the question as to whether the award decree in suit No. 230 of 1949 is binding on the plaintiffs. Consequently, it dismissed the plaintiffs' suit. From that decision, the plaintiffs went in appeal to the District Court and the District Judge having confirmed the decision of the trial Court, the plaintiffs have preferred the present second appeal.

2. The principal point urged by Mr. Peerbhoy, for the appellants, is that the de facto guardian of the minors had no authority to refer any dispute to arbitration and that the reference, therefore, was void ab initio, with the result that the award and the decree that was passed on the basis of the award are null and void. He contended that although a prayer has been made for setting aside the award, in substance, the prayer should be treated as a prayer for declaration that the award is void ab initio. According to him, it was not necessary for the plaintiffs to have the award set aside. He urged that if this view is accepted, then it follows that it was not necessary for the plaintiffs to make a petition under Section 33 of the Arbitration Act for setting aside the award. Alternatively, he suggested that in case the Court finds that it is necessary to make an application under Section 33 of the said Act for setting aside the award, then the suit may be converted into a petition for setting aside the same. He argued that to such a petition Article 181 of the Indian Limitation Act would apply and, therefore, there would be no difficulty of limitation.

3. Under the Mahomedan law, the only legal guardians of the property of the minors are:-

(1) the father;

(2) the executor appointed by the father's will;

(3) the father's father;

(4) the executor appointed by the will of the father's father.

The mother is not a legal guardian. No other relation is entitled to the guardianship of the property of a minor as of right, not even brother, uncle etc. It is, however, open to any person to place himself in charge of the person and property of a minor and such a person is called de facto guardian. Under the Mahomedan. law, a de facto guardian is merely a custodian of the person and property of the minor. The expression 'de facto guardian' is used in contradistinction to de jure guardian. The powers of legal guardian and de facto guardian have been discussed by D. F. Mulla in his book on. the Mahomedan Law, 14th ed., at Sections 362, 363 and 364. Section 364 deals with the powers of a de facto guardian to alienate the immovable property. A de facto guardian has no power to transfer any right or interest in the immovable property of the minor and such a transfer is not merely voidable, but void. Mr. Pcerbhoy relied upon the third note to Section 364 referred to above and it is as follows:-

Reference to arbitration by de facto guardian.-The principle of the Privy Council decision in Imambandi v. Mutsaddi referred to in note 1 above has been applied to a reference to arbitration by a de facto guardian.. Such a guardian has no power to refer to arbitration disputes as to the distribution of immovable properties of the minor's father, and the minor is not bound by an award made on such a reference. Nor does the subsequent appointment of the de facto guardian as guardian of the minor under Section 10 of the Guardians and Wards Act, 1880, make the award binding upon the minor in the absence of evidence that the Court approved of the reference.

It is at once evident that the powers of a de facto guardian of making a reference to arbitration is discussed in the context of his powers to alienate the immovable property. If a de facto guardian has no powers to alienate the immovable property of the minor, it follows, as a logical corollary, that he has no power to make a reference to arbitration, which will involve alienation or distribution, of immovable property belonging to the minor. The real question for our consideration is, whether a de facto guardian has power to incur loans and if he has power to do so, it must follow, as a logical consequence, that he had also the power to refer the dispute that arises in respect of that loan, to arbitration. Referring disputes to arbitration is not a power which can be divorced or separated from the general acts of management. It is a power in the course of the management and if a de facto guardian has a right to incur loans, then he must also have the power of instituting suits, defending them and if necessary referring the dispute in relation to that loan to arbitration. Mr. Peerbhoy took the analogy of a partner and he pointed out that although a partner is an agent of the other partners and in that capacity it may be competent to him to file a suit for and on behalf of the firm, it is not competent to him to refer a dispute to arbitration. The analogy, in my opinion, does not hold good. A partner may be an agent of the other partners arid in that capacity he can claim the right to participate in the management of the partnership. The act of referring disputes to arbitration is not incidental to the management of the business. For choosing a domestic forum all partners must necessarily concur. Such a difficulty does not exist in the case of a de facto .guardian. He is in sole charge of the management of the property of the minors and there can be no distinction in principle between his power to file a suit or defend it and his power to refer a dispute to arbitration.

4. Mr. Peerbhoy drew my attention to the observations made by Sir D. F. Mulla in Section 368 of the Mahomedan Law. They are:-

A mother has no power as de facto guardian to enter into any contract whereby a minor would be saddled with, any pecuniary liability. Nor has a brother. It has been held in Madras that she has power to renew a promissory note executed by the minor's father and so stave off an execution against the minor's property.

Mr. Peerbhoy contended that the first sentence in the above passage clearly indicates that the de facto guardian cannot incur any loans. I am unable to accept this interpretation. In this connection, so may refer to the weighty observations of the Privy Council in Imambandi v. Sheikh Haji : (1918)20BOMLR1022 . In fact, Mr. Peerbhoy relied upon this decision and a subsequent decision of the Privy Council in Mohammad Ejaz Husain v. Mohammad Iftikhar Husain (1931) 34 Bom. L.R. 528. for the proposition that the de facto guardian has no power either to alienate the property or to refer a dispute to arbitration which would involve the alienation or distribution of immovable property of the minors. After citing a lengthy passage from the Hcdaya at p. 1033 (in Imambandi's case) Mr. Justice Ameer Ali, who delivered the judgment in that case, proceeded to state (p. 1034) :

The examples given under the second head indicate the class of cases in which the acts of an unauthorised person who happens to have charge of a child are held to be binding on the infant's property. They also help to explain and illustrate the extent of such de facto guardians' powers. The permissibility of these acts depends on the emergency which gives rise to the imperative necessity for incurring liabilities without which the life of the child or his perishable goods and chattels may run the risk of destruction. For instance, he may stand in immediate need of aliment, clothing or nursing; those wants must be supplied forthwith. He may own 'slaves' or 'livestock': food and fodder must be immediately procured. And these imperative wants may recur from time to time. Under such circumstances power is given to the lawful guardian to incur debts or to raise money on the pledge of the minor's goods and chattels. And this power, in the absence of a de jure guardian, the law extends to the person who happens to have charge of the child and of the child's property,- though not a constituted or authorised guardian.

It is clear from the above passage that in case of emergency or distress, a de facto guardian has power to incur loans or to pledge or sell away the movable property. The powers of a de facto guardian are undoubtedly limited. But that is not a point which is relevant for the present discussion. What is necessary for the plaintiffs to prove is the absolute or inherent want of power or authority on the part of the guardian to incur loans under any circumstances. Mr. Peerbhoy suggested that if the powers of the de facto guardian are limited then the Court will have to examine the limits of these powers in a petition for setting aside the award or even in a suit for setting aside the same, with a view to find out whether the guardian, in fact, exceeded those limits. I am unable to accept this line of reasoning. Such an enquiry will not only be foreign to a suit, but, it will be beyond the scope of the enquiry for setting, aside the award under Section 82 of the Arbitration Act. The only question that can possibly be considered in a suit (I may not be taken as laying down a proposition that a suit is maintainable for that purpose) is, whether the de facto guardian had no authority, whatsoever, for incurring loans and for referring disputes in regard to those loans to arbitration. Once we come to the conclusion that such a guardian has powers of incurring loans, howsoever those powers are limited, it is impossible to say that he has no jurisdiction or authority to do so. If he has authority to incur loans then obviously, he has also authority to refer disputes relating to the same to arbitration.

5. Mr. Peerbhoy then referred to the ratio in the Privy Council case in Mohammad Ejaz Husain v. Mohammad Iftikhar Husain to the following effect:

Under Mahomedan law, a mother who is not appointed a guardian either by the father or by the Court under the Guardians and Wards Act cannot be legal guardian of her minor children. Such a mother has no authority to refer to arbitration any disputes as to the division of the property belonging to the father of her minor children. An award, so arrived at, even though acted upon for a long period, is not binding on the minor children as a family arrangement.

6. Mr. Pesrbhoy wanted to interpret this ratio to mean that it contains an absolute prohibition to the de facto guardian to enter into a reference of any kind irrespective of whether it results in the alienation or distribution, of the immovable property or not. In my view, there is no justification for such an interpretation either in the facts of the case or in the judgment delivered in Mohammad Ejaz Husam's case. Now, the decision in Mohammad Ejaz Husain's case followed the decision in Imambandi's case and the only ground on which the reference was held bad was that it resulted in the distribution of the immovable property of the minor and since the de facto guardian has no power to alienate the immovable property of the minor, the reference which results in such an alienation is invalid and void.

7. In the view that I have taken on the main point, it is not necessary to consider in detail the arguments that were addressed before me as to whether it is open to the minors to file a suit for a declaration that the reference was-invalid.

8. Mr. Sukthankar, for the respondents, strenuously contended that in view of the very wide language employed in Section 32 of the Arbitration Act, a suit, even if it is instituted on the footing that the reference is void, is barred and the only remedy is to file a petition under Section 33 of the Arbitration Act. Section 32 of the said Act in substance lays down:

No suit shall lie on any ground whatsoever for a decision upon the existence, effect or validity of an arbitration agreement or award, nor shall any arbitration agreement or award be set aside, amended, modified or in any way affected otherwise than as provided in this Act.

The words 'existence, effect or validity of an arbitration agreement or award'' contained in Section 32 of the above Act are undoubtedly of a very wide connotation, and it is possible to hold that the question as to whether the arbitration agreement is void is also included within the ambit of Section 32 of the said Act. Mr. Peerbhoy contended that the present suit will not be hit by Section 32 of the Arbitration, Act in so far as it is based on the allegation that the de facto guardian had no authority to refer the dispute to arbitration. According to him, it is not merely a question of validity or invalidity of the arbitration agreement, but the' question raised goes much deeper than that in, so far as it challenges the authority of the person who entered into that agreement. As stated above, I do not feel called upon to decide this question, since I have already held that the de facto guardian had authority to make a reference to arbitration.

9. Mr. Peerbhoy then suggested that if the suit is held to be incompetent, then-it should be converted into a petition under Section 33 of the Arbitration Act. For this purpose, he relied upon a decision in Deolei Nandan Dalmia v. Basant Lal Ghanshyam Das [1941] 2 Cal. 123. Lort-Williams J. observed:

But in order to save costs, I will treat the plaint as an application under Section 33 and set it down for hearing with witnesses, because the question whether the contracts were gaming and wagering contracts cannot conveniently be tried on affidavits.

Assuming that the Court has such a power and assuming further that this is a fit case in which a suit should be allowed to be converted into a petition, the further question that arises for consideration is whether the petition is in time. If the suit is converted into a petition, it will immediately attract the application of Article 158 of the Indian Limitation Act. Article 158 of the Limitation Act prescribes the period as thirty days from the date of service of the notice of the filing of the award. Mr. Peerbhoy contended that the proper article to be applied to such a case is Article 181 of the Act, under which the period of three years has been laid down and it begins to run when the right to apply accrues. Now, Article 181 of the said Act is a residuary article arid applies only where no period of limitation is provided elsewhere in the second schedule of the Limitation Act. As soon as the suit is converted into a petition, it becomes a petition for setting aside the award and, therefore, it will be governed by Article 158 of the Limitation, Act.

10. The result is that the appeal fails and is dismissed with costs.


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