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Anrudh Kumar and anr. Vs. Lachhmi Chand - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtAllahabad
Decided On
Reported inAIR1928All500
AppellantAnrudh Kumar and anr.
RespondentLachhmi Chand
Excerpt:
- - kamal devi was that the transfers in her favour were good and binding, and that in the course of criminal proceedings against her husband a large sum of money was spent which had been taken as a loan, and in this way a considerable amount of debt, i. 30,000 was due to her from her husband, and a deed was executed in order to make arrangements for payment of the debt as well as for its satisfaction. there can be no doubt that a promise to discharge the liability of a transferrer is good and valid consideration. when it was found that the document on which his claim was based was forged and he had no legal title whatsoever it was clearly his duty to repay the amount taken out by him. if one were to proceed on grounds of justice, equity and good conscience one would have no hesitation..........and they were all separate. the defendant anrudh kumar is the son of mohar and defendant 2, mt. kamal devi, is anrudh kumar's wife. on 24th august 1920, baldeo died as a separated owner. mohar had predeceased him. under the hindu law if baldeo had died intestate lachhmi chand would have succeeded to the entire estate. anrudh kumar, who was not the heir-at-law, apart from alleging jointness, set up a will in his favour. in the lifetime of baldeo some land had been acquired by the government under the land acquisition act and he died while the proceedings were pending a sum of rs. 33,000 and odd was awarded as compensation for the property so acquired. on 14th march this amount was paid to anrudh kumar who claimed to be the heir of the deceased baldeo. a suit was instituted by anrudh.....
Judgment:

Kendall, J.

1. This is a defendants appeal arising out of a suit for recovery of Rs. 33,000 and odd principal and Rs. 5,000 and odd interest. It appears that Lachhmi Chand, plaintiff, had two brothers Mohar and Baldeo and they were all separate. The defendant Anrudh Kumar is the son of Mohar and defendant 2, Mt. Kamal Devi, is Anrudh Kumar's wife. On 24th August 1920, Baldeo died as a separated owner. Mohar had predeceased him. Under the Hindu law if Baldeo had died intestate Lachhmi Chand would have succeeded to the entire estate. Anrudh Kumar, who was not the heir-at-law, apart from alleging jointness, set up a will in his favour. In the lifetime of Baldeo some land had been acquired by the Government under the Land Acquisition Act and he died while the proceedings were pending A sum of Rs. 33,000 and odd was awarded as compensation for the property so acquired. On 14th March this amount was paid to Anrudh Kumar who claimed to be the heir of the deceased Baldeo. A suit was instituted by Anrudh Kumar against Lachhmi Chand which was decided on 18th June 1921 by the first Court. It found that the family was separate and that the will which had been set up by Anrudh Kumar was a forgery. This decision was ultimately affirmed by the High Court on 27th November 1924.

2. Even in the lifetime of Baldeo it is a fact admitted by Anrudh Kumar that he was indebted to him to the extent of about Rs. 40,000. Before the civil suit was decided by the Subordinate Judge, the appellant Anrudh Kumar executed a deed of gift dated 5th May 1920 in favour of his wife of considerable landed property. After the decision by the first Court, and during the pendency of the appeal in the High Court, he executed a second deed of gift dated 10th November 1921 in favour of his wife, under which he transferred to her other immovable properties and an insurance policy. In execution of his decree for costs Lachhmi Chand sought to attach certain movable properties including a phaeton and a motor car alleged to belong to Anrudh Kumar. In the course of these proceedings a document dated 14th June 1903, purporting to be the receipt in proof of the sale of movable properties was produced on behalf of Mt. Kamal Devi. The movables were attached a few days after 14th June 1923.

3. In the present case the plaintiff alleged in para. 5 of his plaint that in order to evade payment of the debts due by Anrudh Kumar to him, he had all along been making transfers in respect of his property in favour of his wife Mt. Kamal Devi without any consideration, so that now the whole of the movable and immovable properties stand in her name and that she by reason of her being the universal donee of the entire movable and immovable properties, is liable for payment of the debts due by defendant 1. It was on that account that she was made a defendant. The relief claimed by the plaintiff was for a decree for the principal sum due together with interest from 14th March 1921, to 17th September 1923, the date of filing the suit, at 6% per annum by way of damages against both the defendants. In the plaint the plaintiff did not mention any of the dates of the alleged transfers an favour of defendant 2, but in an application praying for injunction, which was dated 17th September 1918. and was filed on 19th September i.e., one day after the filing of the plaint, the three dates, 5th May 1920, 10th November 1921 and 14th June 1923, were actually mentioned. The plaintiff did not in the plaint allege specifically that these transfers were wholly fictitious and null and void, nor did he even ask for the specific relief of a declaration that these transfers had been made in order to defeat or delay creditors and were liable to be avoided by the plaintiff under Section 53, T.P. Act.

4. The defence put forward by Mt. Kamal Devi was that the transfers in her favour were good and binding, and that in the course of criminal proceedings against her husband a large sum of money was spent which had been taken as a loan, and in this way a considerable amount of debt, i.e., Rs. 30,000 was due to her from her husband, and a deed was executed in order to make arrangements for payment of the debt as well as for its satisfaction. Anrudh Kumar in his written statement mainly pleaded that he was not liable to pay interest on the amount claimed by the plaintiff.'

5. The learned Subordinate Judge framed numerous issues, out of which Nos 5, 6 and 10 relate to the points that have been argued before us. His conclusion was that the effect of the first two documents was to transfer all the properties to the wife so as to make her the universal donee, and, therefore, liable for the entire amount due from defendant 1 to the plaintiff. He also came to the conclusion that the plaintiff was entitled to recover the interest claimed.

6. Although both the defendants have preferred a joint appeal it is necessary to consider the case of each separately.

7. The contention on behalf of Mt. Kamal Devi is that she was not the universal donee, and the suit should have been dismissed as against her in its entirety. The finding of the Court below that she was such a donee is based on its interpretation of the second deed of gift dated 10th November 1921. The learned advocate for the respondent has to concede that under the first deed of gift of May 1920 the whole of the estate was not transferred to the lady, and she cannot by virtue of that document be deemed to be the universal donee. His contention is, and this has found favour with the Court below, that the effect of the second deed of gift was to transfer the entire estate to her. We find it difficult to understand how the learned Subordinate Judge could come to that conclusion. It may be that he thought that Section 128, T.P. Act was applicable to immovable properties only and that it was immaterial if certain movable properties had been left out from the transfer. If that was his view it was certainly incorrect because Section 128 is not limited in that way. Perhaps he thought that the language of the second deed of gift indicated that the donor was transferring all the properties that he owned to his wife. The clause in the deed on which reliance has been placed on behalf of the respondent is:

I have made a gift of the whole of my property mentioned above including the aforesaid policy, the details whereof have also been fully given separately.

8. We are unable to interpret this language as implying that he was making a gift of all the properties that he possessed. On the other hand it is quite clear that what he meant was that he was transferring the whole of the property which had been described above. Our interpretation of this document finds support from a similar expression used in the first deed of gift, where also it was stated that his 'entire zemindari property, a full specification whereof has been given below, was being transferred.' In our opinion the Court below was not justified in inferring that the property which was gifted in November 1921 constituted the entire estate which the donor then possessed. This being so, it follows that Mt. Kamal Devi did not become the universal donee by virtue of these two deeds of gift. As a matter of fact it is highly unlikely that in November 1921, Anrudh Kumar was not possessed of any movable property. That he was in possession of considerable movable properties two years afterwards is demonstrated by the receipt dated 14th June 1923, evidencing the transfer of several motor cars, carriages and other articles.

9. The last contention on behalf of the respondent in this connexion is that the effect of the transfer of movables in June 1923 was to constitute Mt. Kamal Devi the residuary donee. The learned Subordinate Judge has not recorded any finding that this last transaction was one of gift and not one of sale. At p 10 referring to this transfer he remarked that the plaintiff had attached a phaeton and a motor-car of the defendant and it was ultimately found that they too had been transferred by defendant 1 in favour of defendant 2. With the exception of this passage there is no other statement in the body of the judgment suggesting the nature of the transaction relating to these movables. The decree which he passed, however, covers the entire properties, movables and immovables, which had been referred to in the plaint.

10. The document dated 14th June 1903 undoubtedly recites that Anrudh Kumar had no other property except the few movables detailed thereunder which he was transferring to his wife. If this transaction was one of the gift there can be no doubt whatsoever that on that date he was transferring all that he owned and possessed to his wife; and it would make her the universal donee, and as such liable for her husband's debt to the extent of the property comprised therein

11. It has, however, to be seen whether it is proved that this transaction was one of gift, that is to say, a transfer without consideration. The learned Subordinate Judge has remarked that in the execution proceedings it was ultimately found that the property had been transferred. The order of the execution Court is not on this record, and it is not possible to speculate what was the opinion expressed by the execution Court. If the order was against the present plaintiff the burden undoubtedly lay heavily on him to establish that order was wrong. In any case it is obvious to us that the plaintiff had no cause of action against Mt. Kamal Devi unless he succeeded in making out a case that she was the universal donee. It was only on that ground that he could implead her in the suit and ask for a decree against her jointly with her husband. As remarked above the plaintiff did not come to Court alleging that the transfers in her favour were entirely fictitious and null and void, and could be ignored. Nor did he ask for any specifies declaration to get them avoided so that the property might be available hereafter in execution of the decree which he might obtain against the husband. The sole ground for impleading Mt. Kamal Devi was the allegation that she was the universal donee by virtue of the transfers in her favour. The burden, therefore prima facie lies on the plaintiff to show that the transaction was one of gift. The plaintiff led absolutely no evidence to show this, either oral or documentary. The document which was summoned on behalf of the plaintiff purports to recite a transaction of sale and not a gift. It states that Mt. Kamal Devi had to pay the fine of Rs. 12,000 which had been imposed on her husband by the Sessions Judge, and for that purpose borrowed that amount from Lala Balbir Singh with the authority of her husband, which the latter confirmed by that document. It then goes on to recite that Anrudh Kumar was transferring all his movables to her in consideration of the payment of the aforesaid debt to Lala Balbir Singh, which she had undertaken to do. It is thus clear that the consideration shown by this document for the transfer was the promise held out by Mt. Kamal Devi to discharge the debt due to Lala Balbir Singh, which had been authorized by Anrudh Kumar, and which he had confirmed. No cash consideration was paid at that time nor was the transfer effected in lieu of any past consideration. The consideration consisted entirely of the promise to discharge the liability of Anrudh Kumar. There can be no doubt that a promise to discharge the liability of a transferrer is good and valid consideration. Section 122, T.P. Act, defines a gift as being a voluntary transfer without consideration. If therefore there was any consideration in the shape of a promise to discharge the debt of the transferrer the transaction could not prima facie be treated as a gift, pure and simple.

12. The learned advocate for the respondent has, however, argued that the circumstances of this case indicate that the passing of consideration was not intended. In support of this theory he has relied on the fact that Anrudh Kumar was indebted to Baldeo to the extent of Rs. 40,000 in his lifetime, that even after his death he was indebted to the estate of Baldeo to the extent of over Rs. 33,000, that these gifts were effected at a time when the forged will set up by him was being impugned in a Court of law, and lastly that these transfers were made in favour of his own wife at a time when the transferrer was heavily indebted and it was his primary duty to discharge his debts rather than to deprive himself of all his estate by transferring it to his wife.

13. These are undoubtedly circumstances which raise considerable suspicion, and might have gone to suggest that the whole transaction was fictitious and fraudulent. It is, however; nobody's case that this document of June 1923 did not effect an out-and-out transfer. It is only the nature of the transaction that is in dispute, viz., whether it was a sale or a gift. Anrudh Kumar, who was no doubt an interested party, was examined as a witness in this case, but the only question that was put to him was as to his having written the letter dated 14th June 1923. The position accordingly is that on the one hand we have certain suspicious circumstances which throw considerable doubt on the bona fides of the transactions, and on the other we have the recitals in the document itself and no evidence to the contrary that it was evidence of a transaction of sale. Having held that the burden lay on the plaintiff to establish that defendants became the universal donee by virtue of this document we must conclude that burden, in the absence of any evidence on behalf of the plaintiff, has not been discharged.

14. It is clear, therefore, that in this suit it is absolutely impossible to make defendant 2 liable for payment of the debts of her husband Anrudh Kumar. It is not necessary for us to indicate what further remedy may be open to the plaintiff in the execution department or by a separate suit. The suit as brought must be dismissed against Mt. Kamal Devi. We have no doubt in our minds that she and her husband were making common cause with each other, and there are certain peculiar circumstances which justify us in directing that she should bear her own costs.

15. The appeal of Anrudh Kumar must, however, be dismissed. The only point that has been urged on his behalf is that he should not have been made liable to pay interest on the amount which had been paid over to him in the land acquisition proceedings. There can be no doubt that Anrudh Kumar set up a forged will in his favour, and it was on the strength of that forged document that he succeeded in recovering Rs. 33,000 odd which were due to the estate of Baldeo, by falsely alleging that he was his legal representative. Anrudh Kumar has had the use of this money for all these years. When it was found that the document on which his claim was based was forged and he had no legal title whatsoever it was clearly his duty to repay the amount taken out by him. The plaintiff was driven to carry on a protracted litigation against Anrudh Kumar up to the appellate Court before he succeeded finally in exposing the spurious character of the document set up by Anrudh Kumar. The present suit was instituted within three years of the date when the money was taken out by Anrudh Kumar and indeed even before the disposal of the appeal in the High Court. If one were to proceed on grounds of justice, equity and good conscience one would have no hesitation in allowing the plaintiff compensation for the withholding of this amount for all these years. The learned advocate for the appellants, however, contends that interest can be allowed only if the grounds of the case are to be found either in the Interest Act of 1839 or Section 73, Ill. (n), Contract Act. In this view he relies strongly on the case of Jwala Prasad v. Hoti Lal AIR 1924 All 771. which undoubtedly supports him. We might, however, point out that it is not quite accurate to state that the grounds must be found in Section 73, Ill. (n), Contract Act. The illustration of course is not exhaustive and cannot be co-extensive with the provision in the section itself. The view taken in the Madras High Court in the case of Abdul Saffar v. Hamida Bibi Ammal [1919] 42 Mad. 661 is that interest can be allowed on equitable grounds even if the case does not fall within the statutory enactments. The learned Judges of the Madras High Court relied on three cases decided by their Lordships of the Privy Council which they thought indicated that interest could be allowed on principles of equity, justice and good conscience. It is not necessary for us to decide this point in this case as in our opinion the present case comes within the four corners of the provisions of the Contract Act.

16. Chapter 5, which deals with certain relations resembling those created by contract contains Section 72, under-which a person to whom money has been paid or anything delivered by mistake or under coercion, must repay or return it. There is no doubt here that the amount of compensation money was paid to Anrudh Kumar under the mistaken belief that he was the legal representative of Baldeo who had been entitled to this amount. There was thus a legal obligation on Anrudh Kumar to repay or return this amount. Section 73, para. 3, Contract Act, provides that when an obligation resembling those created by contract has been incurred and has not been discharged, any person injured by the failure to discharge it is entitled to receive the same compensation from the party in default as if such person had contracted to discharge it and had broken his contract. This paragraph speaks of an obligation resembling those created by contract, and not necessarily a completed contract as is mentioned in Ill. (n) to this section. Reading Sections 72 and 73 we have no doubt in our minds that the obligation on Anrudh Kumar to repay or return the amount was one resembling that created by a contract. When the land acquisition officer made the payment to him it was undoubtedly understood that the payment was made to him as representing the estate of Baldeo, whose property had been acquired by Government. If that supposition was wrong there was an obligation on the payee to refund the amount to the true heir. The present suit was instituted by Lachhmi Chand, who has been found to be the lawful heir entitled to this amount. We are, therefore, of opinion that the plaintiff should be allowed compensation for the withholding of the amount from him for all this period. The Court below has fixed the ordinary Court rate of interest of 6% per annum as a reasonable rate of compensation, which we think was quite fair.

17. The result, therefore, is that the appeal of Mt. Kamal Devi is allowed and the suit against her is dismissed, but these two parties are to bear their own costs. The appeal of Anrudh Kumar is dismissed with costs. He will pay the full costs of the plaintiff in the Court below and one-sixth of the costs of the plaintiff in this Court and will bear his own costs.


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