1. This appeal is by the defendant. The trial Court has passed a decree for specific performance.
2. The suit was filed by the plaintiffs (respondents 1 and 2), when they were minors, through their guardian. Smt. Phuli-bai, their mother Smt. Phulibai had entered into an agreement dated 30-9-1961 on behalf of the minors for purchasing house property from the defendant (appellant) for a consideration of Rs. 11,000. Bs. 1,000 were paid towards earnest and the rest of the amount was to be paid at the time of the registration of the sale-deed. The sale-deed was to be executed by the defendant by Kar-tik Sudi Poonam. Samvat 2018 (22nd Nov-mber 1961'). The relevant terms of the agreement were:
'(a) The purchaser shall construct a partition wall at his own cost and in the presence and help of the vendor.
(b) The door towards the portion of Mangal Chand will be closed by the purchaser on his own cost and in presence of the vendor.
(c) The vendor would see that his tenant Hardikar vacates the house by 3-10-1961 and inform the purchser.
(d) The vendor shall pay Rs. 200 towards the expenses of the registration and the balance shall be borne by the purchaser.' The plaintiffs' case was that they were ready and willing to perform their part of the contract. The defendant, however, did not obtain permission from the Municipal Corporation and hence the construction envisaged under the agreement could not be completed. The defendant did not perform his part of the contract and did not offer to execute the sale-deed. Hence, the suit for specific performance was filed.
3. The defence was that the breach was committed by the plaintiffs themselves and that they were not entitled to the specific performance. It was urged on behalf of the plaintiffs that they had collected certain material to construct the partition wall as per the agreement, but the construction was stopped as the permission of the Corporation was not obtained by the defendant. The defendant, on the other hand, urged that the wall was constructed by him at his own expenses and that the work was stopped by the Corporation because the permission was not obtained. The defendant, therefore claimed that he was entitled to the expenses incurred by them; and as the plaintiffs' guardian was not prepared to pay the amount, the sale-deed was not executed. Thus, the breach was committed by the plaintiffs.
4. The trial Court found that the responsibility of constructing the partition wall was that of the purchaser, even if the defendant spent any amount, he did it at Ms own risk. The defendant's story that he spent any amount in constructing the wall was also disbelieved. The trial Court found that the plaintiffs were always willing to purchase the property and hence decreed their suit for specific performance.
5. It may by noted at this stage that no plea was raised by the defendant that the contract being a contract on behalf of the minors by their guardian was not specifically enforceable for want of mutuality. That plea being a plea of law, we have allowed the appellant to raise it before us. To enable the respondents to meet this plea, we had adjourned the case for a day. On the next day, full arguments on both the sides were heard on merits as well as on the question of law raised in this case.
6. On merits, after going through the evidence on record, we are satisfied that the trial Court was right in holding that the plaintiffs were not guilty of committing any breach of the contract and that the defendant was not willing to execute the sale-deed as per the agreement. We are, however, of the view that the plaintiffs' suit cannot be decreed for want of mutuality.
7. In Mir Sarwarjan v. Fakhruddin Mahomed Chowdhuri (1912) 39 Ind. App. 1 (PC), their Lordships of the Privy Council held:
'They are, however, of opinion that it is not within the competence of a manager of a minor's estate or within the competence of a guardian of a minor to bind the minor or the minor's estate by a contract for the purchase of immovable property, and they are further of opinion that as the minor in the present case was not bound by the contract there was no mutuality, and that the minor who has now reached his majority cannot obtain specific performance of the contract.' (p. 6)
In Krishna Chandra Sharma v. Rishabha Kumar, AIR 1939 Nag. 265 Niyogi, J., after reviewing the decisions of other High Courts observed:
'.....all the High Courts are unanimous on the view that a guardin's contract for sale or purchase made on behalf of the minor is not enforceable by or against this minor. The principle underlying the view enunciated by their Lordships of the Privy Council evidently appears to be that a minor is not personally bound by any contract made on his behalf by his guardian as was laid down by their Lordships of the Privy Council in Waghela Raisanji v. Shekh Masludin, (1887) ILR 11 Bom 551 (PC) see also Ramajogayya v. Jaganadham, ILR 42 Mad 185= (AIR 1919 Mad 641) (FB). A contract for sale of immovable property does not of itself create an interest in or charge on such property: see Section 54, T. P. Act. If it is a contract of purely personal nature and no personal liability can be imposed on the minor, it must logically follow that the minor cannot be compelled to perform the contract; for the same reason he cannot take advantage of the contract and ask for specific performance. There is another aspect to the question: Can the purchaser recover compensation from the minor for a breach of contract by the guardian? In every case when there is refusal to implement the contract of sale by the guardian the breach is committed by the guardian and never by the minor. The purchaser therefore can only claim compensation against the guardian and not against the minor or his property except in the case where the guardian uses the money obtained from the purchaser for the improvement of the minor's estate, a case which stands on a separate footing. The purchaser is not entitled to hold the minor personally responsible for the breach of contract of sale made by his guardian and he is not therefore entitled to claim compensation from him. If that is so, Section 24A, Specific Relief Act, debars the purchaser from claiming the relief of specific performance against the minor.' (P. 267)
In the abovenoted case, Niyogi, J. has brought out effectively the principle underlying the view enunciated by their Lordships of the Privy Council in Mil Sarwarian's Case, (1912) 39 Ind App 1 (PC).
8. In Ramrao v, Suganchandra, ILR 1946 Nag 116 (AIR 1946 Nag 139) a Division Bench of the Nagpur High Court (Grille, C. J. and J. Sen, J.), following the decision of their Lordships of the Privy Council in Mir Sarwarjan's Case, (1912) 39 Ind App 1 (PC) and other cases, held that it is not within the competence of a guardian of a minor to enter into a contract for the purchase of immovable property and that contract cannot be specifically enforced either on his behalf or against him. Their Lordships have further held that the contract by a manager of a joint Hindu family stood on a different footing. It was held:
'A manager of a joint Hindu family which includes minors can enter into a contract for the sale or purchase of immovable property and the contract can be specifically enforced against the family including the minors.'
According to their Lordships:
'The interest of a member of a joint Hindu family is not individual property at all.....A manager of a joint Hindu family is not an agent of the family. His position is more like that of a trustee.....But it is not precisely the same as that of a trustee, for if it were so, he would be bound to economise and save, as a trustee is which, it has been held, he is not.....
A manager represents the family and any transaction entered into by him which is for legal necessity or for the benefit of the estate is binding upon the family including the minors.'
It is for this reason that a contract entered into by the manager of a joint Hindu family can be specifically enforced even against a minor coparcener or a minor coparcener can likewise ask fov specific performance of the contract. This case clearly brings out the distinction between a contract entered into by a guardian qua a guardian of the minor and a contract entered into by a manager of the family for the family as such including the minor.
9. Under the Mahomedan Law, a guardian has no authority to deal with the estate of a minor. As such, a contract to sell or purchase entered into by such guardian was held to be void and not binding on the minor. The position of a guardian of a Hindu minor is slightly different. The guardian under the Hindu Law has the authority to charge the property of a minor or to sell it on grounds of necessity or benefit to the minor. Even so, it was not within the competence of the guardian of a minor to bind the minor's estate by contract for purchase of immovable property. A distinction was also made between 'executed contracts' and executory con-tracts. In the case of execution contract, it was held that even though it was for the benefit of the minor, it could not be specifically enforced, and for this proposition reliance was placed on Mir Sarwarjan's case, (1912) 39 Ind App 1 (PC). Thus, upto 1948 it was firmly settled that a Hindu guardian could alienate infant's property only in case of necessity and for benefit of the estate and that he had no authority to enter into a contract to purchase property for the minor and that such contract could not be specifically enforced. In the case of executed contracts, it was, however, held that the transaction could be set aside only on proof that the guardian had no authority to enter into the contract or that it was not for the benefit of the minor.
10. In 1948. the Privy Council, however, delivered a judgment in Subrahmanyam v. Subba Rao, 75 Ind App 115= (AIR 1948 PC 95) which has according to some High Courts, the effect of overruling Mir Sarwar-jan's Case, (1912) 39 Ind App 1 (PC). In Subrahmanyam's case, 75 Ind App 115= AIR 1948 PC 95 their Lordships of the Privy Council referred to the following passage from Pollock and Mulla's Indian Contract and Specific Relief Acts, Edn. 7, p. 71 :
'It is, however, different with regard to contracts entered into on behalf of a minor by his guardian or by a manager of his estate. In such a case it has been held by the High Courts of India, in cases which arose subsequent to the governing decision of the Privy Council Mohori Bibi v. Dhuramdas Ghose, (1903) 30 Ind. App. 114 (P. C.), that the contract can be specifically enforced by or against the minor, if the contract is one which it is within the competence of the guardian to enter into on his behalf so as to bind him by it, and, further, if it is for the benefit of the minor. But if either of these two conditions is wanting, the contract cannot be specifically enforced at all.' Having quoted this Paragraph, their Lordships proceeded to observe:
'In the present case neither of the two conditions mentioned is wanting. having regard to the findings in the Courts in India. It would appear, therefore, that the contract in the present case was binding upon the respondent from the time when it was executed If the sale had been completed by a transfer, the transfer would have been a transfer of property of which the respondent, and not his mother, was the owner. If an action had been brought for specific performance of the contract, it would have been brought by or against the respondent and not by or against his mother.
Having regard to all the circumstances, their Lordships are of opinion that the respondent is the person who most aptly answers the description of 'the transferor' in the sense in which these words are used in Section 53A. It follows that he is debarred by the section from obtaining the relief claimed by him in the present action, which was rightlv dismissed bv the Subordinate Judge,'
11. In Subrahmanyam's case. 75 Ind App 115 = (AIR 1948 PC 95) the facts were that A had executed promissory notes in the sum of Rs. 16,000 in favour of B. He had also mortgaged certain property to a third partv in the sum of Rs. 1,200 A died on 4-10-1935. His widow entered into an agreement dated 29-11-1935 on behalf of her minor son to transfer the mortgaged pro-perty to B for a consideration of Rs. 17,000. Out of this amount, B was to utilise Rupees 1,200 in redeeming the mortgage and rest of the amount towards satisfaction of his own debt under the promissory notes. B was put in possession of the property in part performance of the contract. B redeemed the mortgage. No sale-deed was, however, executed in favour of B. Subsequently, a suit was filed on behalf of the minor for possession of the property on the ground that the agreement entered into by his mother was not binding on him. The defence was that B was protected under Section 53A of the Transfer of Property Aet. The trial Court held that as A and his son, the minor, were members of a joint Hindu family, the minor was bound to satisfy the debt. His guardian could have, therefore, validly transferred the property, as the transfer would have been for the benefit of the minor. Even though no sale-deed was executed in favour of B, he was entitled to protection under Section 53A of the Transfer of Property Act. This decision was reversed by the first appellate Court and was confirmed by the High Court. Before the Privy Council the only point that came for consideration was as to whether Section 53A could afford any protection to B or not. Section 53A provides that a transferor is debarred from enforcing 'any right in respect of any property if the transferee has been put in possession of the property in part performance of the contract to purchase the property even though the transfer in his favour is not effected as required by law.
Their Lordships were, therefore, called upon to decide as to whether the expression 'the transferor' would include a minor on whose behalf the agreement had been entered into by the guardian. In this context, their Lordships referred to the power of a guardian of a Hindu minor to enter into a contract to transfer the minor's property and quoted, with approval, the extract from Pollock and Mulla's Indian Contract and Specific Relief Acts, reproduced above. From this decision it is clear that in the view of their Lordships if the transfer would have been effected, the transfer would have been of the minor's property, and not of his mother, and hence there was no reason why the minor should not be treated as a transferor vis-a-vis the agreement to transfer his property, though the agreement was entered into by his guardian. In this case, their Lordships were not called upon to decide as tn in what cases specific performance of the contract can be enforced against the minor or by the minor. What their Lordships laid down was that in those cases where a transfer if it would have been completed would have been binding on the minor, the position would not be any different if in part performance of the contract, the possession of the property was given to the transferee and he sought protection under Section 53A of the Transfer of Properly Act.
We are, therefore, of the view that the observations of their Lordships in Subrah-manyam's case, 75 Ind App 115 = (AIR 1948 PC 95) are not applicable to all contracts entered into on behalf of the minor. We have already pointed out that the guardian of a Hindu minor could validly transfer his property if it was for legal necessity or benefit of the estate of the minor; but he had no authority to purchase any property. Thus, at least in the case of contract of purchase it could not be said that the law laid down by their Lordships in Mir Sarwarjan's case, (1912) 39 Ind App 1 (PC) was, in any way, altered. It is also significant to note that Mir Sarwarjan's case, 39 Ind App 1 (PC) was cited before their Lordships but it has nowhere been referred to in the judgment. It is, therefore, difficult to hold that Mir Sarwarjan's case, (1912) 39 Ind App 1 (PC) was overruled either expressly or impliedly in Subrahmanyam's case, 75 Ind App 115 = (AIR 1948 PC 95).
12. In Amir Ahmmad v. Meer Nizam Ali, AIR 1952 Hyd 120 (FB) M. S. Alikhan and Siddiqi JJ. held that all contracts entered into on behalf of a minor could be specifically enforced against him or by him in case the contract was entered into by a lawful guardian and was for the benefit of the minor. Deshpande, J., however, took a contrary view. His Lordship pointed out that a contract for the purchase of immovable property could rarely be demonstrably for the benefit of the minor's estate or for legal necessity. This was the basis for drawing a distinction between the contract for purchase of property and the contract for sale entered into on behalf of the minor. His Lordship relied on the decision of Vishwanath Shastry, J. in Ramlingam Reddy v. Babanambal Am-mal, (1950) 2 Mad LJ 597 = (AIR 1951 Mad 431) wherein it was observed:
'The present case is not, however, a ease of a contract for the purchase of immovable property on behalf of a minor by his guardian. It was with reference to such a contract that the Judicial Committee held that a guardian had no power to bind the minor and the minor was not entitled to specific performance of the contract in (1912) 39 Ind App I = ILR 39 Cal 232 (PC). Assuming that this decision survives today in full force, there is no necessity to extend the principle of this decision to contracts for sale of a ward's property by his guardian. It is obvious that the question which is vital to sales by a guardian, namely, necessity, cannot arise in a contract for the purchase, not for the sale of immoveable property'.
In the Full Bench decision of the Andhra Pradesh High Court in V. Suryaprakasam v. A. Gangaraju. AIR 1956 Andhra 33 (FB) the opinion of the Full Bench was delivered by Subba Rao, C. J. (as he then was), wherein his Lordship expressed the opinion that a contract entered into by a guardian of a Hindu minor for sale or purchase of immovable property is specifically enforceable against the minor. His Lordship expressed the view that the decision in Subrahman-yam's case, 75 Ind App 115 = AIR 1948 PC 95 had the effect of impliedly overruling Mir Sarwarjan's case, (1912) 39 Ind App 1 (PC). We may, however, note that the case before the Andhra Pradesh High Court was with respect to the agreement to sell the minor's property by the guardian and the suit was for enforcement of that agreement against the minor. In Gujoba Tulsiram v. Nilkanth, AIR 1958 Bom 202, Mudholkar, J. (as he then was) held that where a minor had received benefit from a contract of sale entered into on his behalf by his father, in respect of property solely belonging to them, the vendee was entitled to specific performance of the contract. In that case, reliance was placed on the decision of the Privy Council in Subrahmanyan's case, 75 Ind App 115 = AIR 1948 P. C. 95. It may, however, be mentioned that in that case special reference was made to Vishwanath ShastryJ.'s judgment in (1950) 2 Mad LJ 597= (AIR 1951 Mad 431) (supra). In the Bombay Case also the question was regarding enforcement of a contract against the minor for sale of his property. It was not a case of specific performance regarding purchase of the property entered into on behalf of the minor.
13. In Abdul Sattar v. Ismail, 1959 MPLJ 36 = (AIR 1958 Madh Pra 373) this question came for consideration before a Division Bench of this Court (V.R. Nevaskar and T. C. Shrivastava JJ). Nevaskar, J., after considering the two Privy Council decisions and the decision of the Madras High Court in Sitarama Rao v. Venkatarama, AIR 1956 Mad 261 (FB) and that of the Andhra Pra-desh High Court in AIR 1966 Andhra 33 (FB) (supra), reached the following conclusion;
''On consideration of the principle dedu-cible from the aforesaid two Privy Council decisions read in the light of the two Full Bench decisions referred to above, I am inclined to the view that the decision of the Privy Council in Mir Sarwarjan's case, (1912) 39 Ind App 1 (PC) (supra) is not overruled by the later decision in 75 Ind App 115 = AIR 1948 PC 95 (supra) and that where a guardian of a minor enters into contract for the purchase of an immovable property the contract is one which is not binding upon the minor and consequently neither the minor nor the vendor can specifically enforce the same.....'
Shrivastava, J., however, expressed the opinion that the authority of Mir Sarwarjan's case, (1912) 39 Ind App 1 (PC) (supra) was considerably shaken by the later decision of the Privy Council in Subrahrnanyam's case, 75 Ind App 115 = AIR 1948 PC 95 (supra). His Lordship, however, conceded that it is normally difficult to support a purchase on the ground of benefit of the minor.
14. In AIR 1956 Mad 261 (supra), Govinda Menon, J., with whom Ramaswami, J., concurred, while considering the effect of the decision of the Privy Council in Sub-rahmanyam's case, 75 Ind App 115 = (AIR 1948 PC 95) (supra), observed:
'During the course of the arguments, the decision in Mir Sarwarjan's case, (1912) ILR 39 Cal 232 (PC) was cited before the Judicial Committee and if there was any idea to cast any doubt on the dectum laid down by Lord Macnaghten, it stands to reason that some reference to it would have been made during the course of the judgment by the Privy Council. That the principles laid down in Mir Sarwarjan's case, (1912) ILR 39 Cal 232 (PC) were not doubted is clear from the fact that though there is a quotation in the Privy Council's judgment from page 71 of Pollock and Mulla's Contract Act, 7th Edn., the quotation from Mir Sarwarjan's case, 1912 ILR 39 Cal 232 (PC) on the same page has not been extracted.
It is, therefore, clear that before their Lordships the observations in Mir Sarwarjan's case, (1912) ILR 39 Cal 232 (PC) and how the same had been understood by text book writers had been prominent but still no dissent has been made of them. The excerpt from page 71 of Pollock and Mulla on Indian Contract Act quoted by the Judicial Committee with approval is to the effect that contracts entered into on behalf of a minor by his guardian or manager of his estate can be specifically enforced by or against the minor if the contract is one which it is within the competence of the guardian who had entered into it on behalf of the minor so as to bind him by it and further it is for the benefit of the minor.
No doubt this presupposes specific performance of a contract against the minor also. The Privy Council decision should therefore be understood in the sense that a contract of sale of the property by the guardian of a minor which is partly performed should be put on the same footing as a completed sale and that the transferor contemplated under Section 55A, Transfer of Property Act, was the minor and not his guardian'. His Lordship further observed:
'Whatever might be the case with regard to the position of minors belonging to other regions even with regard to contracts for sale of property which are governed by the provisions of the Guardians and Wards Act, so far as Hindu minors are concerned, there is no difficulty in holding that the guardian of a Hindu minor is competent to enter into a contract of sale of the minor's property if it is for the necessity of the minor or the minor's estate.
It may be that the concession made by the counsel for the appellant before the Judicial Committee in Subrahrnanyam's case, AIR 1948 PC 95 that the executory contract for the sale of a Hindu minor's property even if it is for the benefit or necessity of the minor's estate cannot be enforced has not taken note of the large body of case law permitting such contract.
In my view the proper way of looking at the question is that the rules of Hindu law by which the guardian of a Hindu minor can sell the minor's estate for necessity or benefit have not in any way been abrogated or rendered doubtful by the decision in Mir Sarwarjan's case, (1912) ILR 39 Cal 232 (PC) which should be confined and restricted to this principle that the guardian of a minor is not at liberty to enter into a contract for the purchase of property in which case necessity or benefit might not arise and such a contract cannot be enforced by the minor on his attaining majority.
I am therefore of opinion that the decision in Mir Sarwarjan's case, (1912) ILR 36 Cal 232 (PC) and those decisions that followed the same should be confined to cases of purchase of property and not in respect of agreements to sell. Viewed in that light there is no difficulty in reconciling Subra-manyam's case, AIR 1948 PC 95 with Mir Sarwarian's case, (1912) ILR 39 Cal 232 (PC).' His Lordship proceeded to observe further:
'It is relevant to note in this connection that the counsel for the respondent before the Judicial Committee relied upon Mir Sarwarjan's case, also and if there had been any intention to depart from the rules laid down there or to whittle down the force of that decision it is proper to presume that the law lord who delivered the judgment would doubtless have referred to it in some way or other in the course of the judgment.
The absence of any reference to it as well as the inapplicability of the points decided therein to the case in Subrahmanyam's case, AIR 1948 PC 95 would lead us only to one conclusion, that is that either expressly or by necessary implication there is no indication of doubting the correctness of the decision in Mir Sarwarian's case, (1912) ILR 39 Cal 232 (PC) which should be restricted to cases where contracts have been entered into on behalf of the minor for the purchase of property and thereby mulcting the minor with the liability personally or otherwise which at the time of the contract cannot be enforced for want of mutuality'
15. After considering the various views extracted above, we are of the opinion that the view expressed by Govinda Menon, J. in AIR 1956 Mad 261 (supra), with which Nevaskar, J. concurred, expresses the correct position and that Subrahmanyam's case, 75 Ind App 115 = AIR 1948 PC 95 (supra) had not the effect of overruling the decision in Mir Sarwarian's case, (1912) 39 Ind App 1 = ILR 39 Cal 232 (PC) (supra) at least so far as the contracts for purchase entered into bv the guardian of the minors are concerned.
16. We may further observe that after the passing of the Hindu Minority and Guardianship Act, 1956, the authority of the natural guardian even to transfer the minor's property for legal necessity has been taken away. Such transfers can now be effected only after obtaining the sanction of the Court. We, therefore, feel that the law laid down by their Lordships of the Privy Council in Subrahmanyan's case, 75 Ind App 115 = AIR 1948 PC 95 (supra) that such contracts could be specifically enforced has lost its authority and the dictum laid down by Lord Macnaghten in Mir Sarwarian's case. (1912) 39 Ind App 1 = ILR 39 Cal 232 (PC) (supra) would now be applicable, with all the force, to all the contracts of the natural guardians, whether for sale or purchase of the property, if no permission of the Court is obtained.
17. For the aforesaid reasons, we hold that the contract in question was not enforceable at the instance of the minors and thedecree of the trial Court must be set aside.We accordingly allow the appeal and setaside the decree passed by the trial Court.The appellant shall, however, be liable toreturn the consideration received by him,with interest at 6 per cent per annum fromthe date the amount was deposited on behalf of the minors till the date the amountis returned by the appellant. The sale-deed,if any, executed in pursuance of the decreeof the trial Court shall stand cancelled onthe appellant depositing the whole amount.In the circumstances of the case, we alsodirect that appellant shall pay the costs ofthe respondents as incurred in the lowerCourt. The costs incurred in this Court shallbe borne by the parties.