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Suresh Chandra Pradhan Vs. Ganesh Chandra De and ors. - Court Judgment

LegalCrystal Citation
SubjectContract
CourtOrissa
Decided On
Case NumberA.F.A.D. No. 186 of 1945
Judge
Reported inAIR1951Ori351
ActsSpecific Relief Act, 1877 - Sections 24 and 27
AppellantSuresh Chandra Pradhan
RespondentGanesh Chandra De and ors.
Appellant AdvocateS.K. Ray and ;H. Mohapatra, Advs.
Respondent AdvocateS.N. Dasgupta and ;H. Bhagat, Advs.
DispositionAppeal dismissed
Cases Referred & Krishnachadra v. Rishabha Kumar
Excerpt:
.....that the p. but it has been recognised in subsequent decisions that the earlier decisions are no longer good jaw. those cases have however, failed to appreciate that the decision in sarwarjan v. 10. we are, therefore, satisfied that the contract in this case which the pltf. who had denied the advance in their defence, have given evidence that the decree debt was satisfied with the money supplied by the third deft......the discharge of which money was sought to be raised by the suit agreement was one binding on the minor's estate or not. the cts. below have been assumed that the agreement was entered into by the guardian for legal necessity & the case must be dealt with on that footing.2. the argument that has been advanced on behalf of the defts. is that no specific performance can be decreed against the minors (& against the subsequent purchaser) on the basis of a contract entered into on their behalf by their guardian even though it may be for legal necessity or for the benefit of the minor. this contention has been accepted by both the cts. below & the suit has been accordingly dismissed. hence this second appeal.3. the same question of law is urged in this second appeal & in view of the conflict.....
Judgment:

Jagannadhadas, J.

1. The pltf. is the applt. in this second appeal. It arises out of a suit for specific performance of a contract for the sale of 35 decimals of laud which belonged to defts. 1 & 2. Defendants 1 & 2 are minors & the suit-contract is one entered into on their behalf by their mother as guardian. The contract was for sailing the property for a sum of Rs. 75 out of which Rs. 35 was paid as advance & the balance was to be paid later. Defendant 3 who is the sister's husband of defts. l & 2 has purchased the suit property on 3-2-1943 subsequent to the agreement in favour of the pltf. The genuineness of the consideration alleged to have bean paid thereunder were denied by the defts. & contested in the Cts. below. It has been found by the trial Ct. that the agreement was true & that a sum of Rs. 35 was paid as an advance under it. It was also found that the agreement was executed in order to raise money to repay a decretal debt for Rs. 60 against the minors in respect of which there was an execution pending at the time. It was further found that deft. 3 was fully aware of the agreement & took the sale deed in his favour with notice of the same. These findings of the trial Ct. were not challenged in first appeal before the learned Subordinate Judge. It is not clear from the judgments of the Cts. below whether the decree-debt for the discharge of which money was sought to be raised by the suit agreement was one binding on the minor's estate or not. The Cts. below have been assumed that the agreement was entered into by the guardian for legal necessity & the case must be dealt with on that footing.

2. The argument that has been advanced on behalf of the defts. is that no specific performance can be decreed against the minors (& against the subsequent purchaser) on the basis of a contract entered into on their behalf by their guardian even though it may be for legal necessity or for the benefit of the minor. This contention has been accepted by both the Cts. below & the suit has been accordingly dismissed. Hence this second appeal.

3. The same question of law is urged in this second appeal & in view of the conflict on this matter, between the view taken by Das J. in Abdul Haq v. Md. Yahya Khan, A.I.R. (11) 1924 pat. 81 : (78 I. C. 483) that of Wort J. in Brahamdeo v. Haro Singh, A. I. R. (22) 1935 pat. 237 : (157 I. C. 327), this appeal has been referred to a Bench. The matter has been fully argued before us. On a consideration of the argument, we have no hesitation in agreeing with the view of Das J. expressed in Abdul Bag v. Mi. Yahya Khan, A. I. R. (11) 1924 Pat. 81: (78 I. C. 483) to the effect that a contract for sale entered into on behalf of a minor by his guardian cannot be specifically enforced.

4. This view is now almost unanimously held in all the H. Cs., & the reasons, therefor, do not require to be elaborated. The crucial question in such a case is whether a contract entered into by a (sic) on behalf of a minor is binding on the minor's estate. It is said that it would be binding if it is for necessity or benefit. It is urged by the learned Advocate for the applts that just as the sale of a property of the minor by his guardian for legal necessity is valid & binding, so also the antecedent contract to sell the property is equally binding on minor. It is stated that a contrary view would produce anomalous results & would not be in the interests of the minor himself. The question, however, turns on the powers of a minor's guardian. In Hanooman Persaud v. Mt. Babooee Munraj, 6 m. I. A. 393 : (18 w. R. 81 p. c.) which is the foundation of judicial decisions relating to the guardian's powers, their Lordships at p. 428 state as follows :

'The power of the Manager for an infant heir to charge ancestral estate by loan or mortgage, is, under the Hindu law, a limited & qualified power. It can only be exercised rightly in a case of need, or for the benefit of the estate.'

5. It will be noticed that what is recognised here is the power to charge an estate and not the power to bind the estate by a mere personal covenant. In a later P. C. case in Waghda Rajsanji v. Masludin, 11 Bom. 551 P. C., their Lordships dealing with the question of the powers of a guardian state at p. 561 as follows :

'Now it was most candidly stated by Mr. Mayne, who argued the case on behalf of the resp., that there is not in Indian law any rule which gives a guardian & manager greater power to bind the infant ward by a personal covenant than exists in English law.

In point of fact, the matter must be decided by equity & good conscience, generally interpreted to mean the rules of English law if found applicable to Indian society & circumstances. Their Lordships are not aware of any law in which the guardian has such a power, nor do they sec why it should be so in India. They conceive that it would be a very improper thing to allow the guardian to make covenants in the name of his ward so as to impose a personal liability upon the ward & they hold that in this case the guardian exceeded her powers so far an she purported to bind the ward.'

6. Since that decision, it has been taken as settled law that a mere executory contract entered into by a guardian on behalf of a minor imposing a personal obligation on the minor's estate is not valid & binding & it makes no difference thai it is for necessity or benafit. Indeed the P. C. in a later case appear to have recognised this principle even to the extent of faying that not only can such a contract not be enforced against the minor, but that the minor cannot even take advantage of it in his own favour & enforce it against the other patty to the contract. That was what was held in Sarwarjan v. Fakhruddin, 39 Gal. 232: (39 I. A. 16 P. C.). That was a case of a contract for purchase of lands entered into by a guardian on behalf of a minor. It was found as a fact in the case that the contract was intended to bind the minor's estate, & that it was for his advantage. All the same, it was held by their Lordships that the minor could not take advantage of the contract & enforce it specifically as against the other party thereto, & they give their reasons for the conclusion as follows:

'Their Lordships are of the opinion that it is not within the competence of the guardian of a minor to bind the minor or the miner's estate by a contract for the purchase of immovable property & they are further of the opinion that as the minor in the present case was not bound by the contract, there was no mutuality & that the minor who has now reached his majority cannot obtain specific performance of the contract.'

7. This is an unequivocal recognition by the P. C. of the position that a contrast by a guardian on behalf of the minor seeking to bind the minor's estate is invalid. It has been suggested that the unenforceability of the contract in this case was assumed by the P. C. on account of the fact that it was a contract of purchase which prima facie cannot be one for the necessity or the benefit of the minor's estate & that therefore this does not militate against the view that a contract for legal necessity is binding. But this suggestion ignores the facts of that case which show clearly that the P. C. recognised the contract to be for the ad. vantage of the minor & therefore for his benefit & yet held it to be unenforceable, obviously on the same principle as has been laid in the prior case of Waghela Rajsanji v. Masluddin, 11 Bom. 651. The case, therefore, in Sarwarjan v. Fakhruddin: 39 cal. 232: (39 I. A. 16 P. C.) is clear authority for the position that a contract by a minor's guardian for his benefit (or necessity) is not binding & it is only in that view that the scope for the application of the principle of mutuality arose. The question has been considered by a P. B. of the Madias H. C. in Ramzjogaya v. Jagnanadham, 42 Mad. 185: (A. I. R. (6) 1919 Mad. 641 F. B.) & it has been there pointed out that the effect of the P. C. decision in Waghela Bajsanji v. Masluddin, 11 Bom. 651, is that a decree cannot be passed against the minor or his estate on a covenant entered into by his guardian for his benefit. That F. B. decision deals with the further question as to whether this principle would affect the liability of the minor's estate under Schedule 8, Contract Act, if it is also secured by a personal bond executed by the guardian on behalf of the minor; bat that is a question with which we are not concerned in the present case.

8. Even on principle, apart from authority, the contention of the applt's advocate that since the sale by the guardian on behalf of the minor for necessity or benefit is binding, the prior contract to sell must also be equally binding, has no force. in respect of dealings by a guardian on behalf of of ft minor, the law has recognised for very salutory reasons, the broad distinction between the binding character of a completed alienation by way of a sale or charge & an executory contract which merely imposes an obligation to alienate. In the former, the validity is recognised as much in the interests of the minor as in the interests of the bona fide purchaser for value. But in the latter, if for any reason, the guardian declines to complete the transaction by actual transfer there is no interest of a bona fide purchaser to be protected & the fact that the guardian has resiled from the executory arrangement is itself a reason why the Ct, should not enforce it against the minor's estate..

9. Before the decision of the P. C. in Mdhri Bibi v. Dharmadas, 30 Cal. 539: (30 I. A. 114 P. C.), holding that a minor's contract is absolutely void & not merely voidable, & before the later decision of the P. C. in Sarwarjan v. Fakhruddin, 39 cal. 232: (39 I. A 16 P. C.), importing the principle of mutuality with reference of contracts, there were undoubtedly a number of decisions in the H. Cts., that a contract for sale by a guardian on behalf of the minor if for necessity or benefit, is valid & binding. But it has been recognised in subsequent decisions that the earlier decisions are no longer good Jaw. Some of the later decisions have, however, attempted to distinguish the case of a contract for sale of minor's property by a guardian for necessity or benefit from the case of a contract for purchase of property by a guardian on behalf of a minor. They have accordingly attempted to distinguish the case in Sarwir jan v. Fakhruddin, 39 Cal. 232: (39 I. A. 16 P. C.) on that ground. Those cases have however, failed to appreciate that the decision in Sarwarjan v. Fakhruddin, 39 Cal. 232 (39 I. A. 16 P. C.) is based on the view, firstly, that the contract by the guardian though for the benefit of the minor is not enforceable & secondly, that since it is not enforceable against the minor's estate, it cannot be enforced in his favour for lack of mutuality. Subsequent decisions have therefore recognised that there is no scope for this distinction. It is enough to refer to the oases in Srinath v. Jatindra Mohan, A.I.R. (13) 1926 Cal. 445: (89 I. C. 892); Ramkrishna v. K. Chidambara, A. I. R. (15) 1928 Mad. 407: (108 I. C. 282); Venkatachalam v. Sethuramrao, A.I. R. (20) 1933 Mad. 322: (56 Mad. 432 F. B.); Swarathram Ramsaran v. Ramballabh, A. I. R. (12) 1925 All. 595: (47 All. 784) & Krishnachadra v. Rishabha Kumar, A. I. R. (26) 1939 Nag 265: (I. l. R. (1940) Nag. 65). There have been some exceptions recognised to this principle such as in the case of a contract by the manager of a joint Hindu family consisting of some minors & it is unnecessary to notice them in this connection.

10. We are, therefore, satisfied that the contract in this case which the pltf. seeks to enforce is not specifically enforceable.

11. Learned counsel for the applt has further urged that the pltf. would at least be entitled to a decree for the refund of the sum of Rs. 35 advanced by him, since it has been found that if was raised for legal necessity, that is, to discharges the decree debt in respect of which an execution was pending against the minors' estate at the time. But this would depend upon whether as a fact the amount has been utilised for the discharge of the debt. This is a question of fact which has not been raised in the Cts. below. If it were absolutely clear on the evidence that the pltf's money has been in fact utilised for the partial discharge of the decree-debt, we might have inclined to consider this request. The learned advocate has drawn our attention to certain portions of the pltf.'s evidence as p. w. l to substantiate that his amount was in fact utilised for partial discharge of the decree debt. But on a perusal of the record, it is found that the deits. who had denied the advance in their defence, have given evidence that the decree debt was satisfied with the money supplied by the third deft. That is what the guardian of the minors, D. W 2, states in her deposition. In this state of conflicting evidence, we do not consider that we will be justified in acceding to the request of the applt's. Advocate 'that there should be a decree for refund of the amount advanced. The second appeal is accordingly dismissed with costs.

Narasimham, J.

12. I agree.


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