1. The facts giving rise to this first appeal are as under: One Balmukand, a resident of Batala, filed a suit against Pindi Das, Haveli Ram, Khem Chand and Sat Pal sons of Nihal Chand, residents of Batala, on 12-2-1947, far possession by specific performance of a contract of sale of 3/20 share of land measuring 13 kanals 1 marla situate in Mauza Faizpur (included in Batala) on payment of Rs. 9,687/8/-. The plaintiff alleged that all the four defendants were real brothers and constituted a joint Hindu family of which Pindi Das defendant was the karkun and manager, that defendant No. 1 as manager was fully competent to make any alienation of the property of the family, that the property in suit was the property of the joint Hindu family, that on 1-10-1945 defendant no. 1 as Manager of the family entered into a transaction of sale of the property in dispute with the plaintiff at the rate of Rs. 250/- per marla and received a sum of Rs. 100/- as earnest money from the plaintiff, that the defendants in spite of being repeatedly asked to receive the remaining sale money from the plaintiff and execute and complete a sale deed in respect of the land in suit had failed to perform their parti of the contract, that the price of the land in question by calculation came to Rs. 9,787/8/-, and that after deducting Rs. 100/- paid as earnest money the plaintiff was entitled to have specific performance of the contract on payment of Rs. 9,687/8/-.
Defendant No. 1 filed one written statement and defendants Nos. 2 to 4 jointly filed another. Defendant No. 1 pleaded that the land in suit had never been sold by him; that the land sold by him was really another land situate in a locality called 'Jowahar Nagar'; that the contract of sale was at any rate vague and uncertain and was null and void; that he had no right to sell the land on behalf of defendants Nos. 2 to 4 and a suit for specific performance of the alleged contract did not lie. Defendants Nos. 2 to 4 pleaded that defendant No. 1 had not entered into any transaction with the plaintiff and that at any rate he was not enfitled to enter into the transaction in question. They further pleaded that the defendants did not constitute Hindu joint family and that in any case the transaction was not for the benefit of the family. The trial Court recorded the statements of the plaintiff and of Pindi Das on 3-4-1947 and then framed the following eight issues:
1. Whether defendant No. 1 on his own account and as the Karta of the joint Hindu family consisting of the defendants entered into an agreement on 1-10-1945 to sell the land in dispute with the plaintiff?
2. Whether defendants 2 to 4 do not form a joint Hindu family with defendant No. 1?
3. Whether the land in dispute is the property of the joint Hindu family consisting of the defendants Nos. 1 to 4?
4. Whether the alleged sale is for the benefit of the joint Hindu family? If not what is ifs effect?
5. If the alleged agreement between defendant No. 1 and the plaintiff is proved and sale is not for the benefit of the joint Hindu family can the defendant No. 1 be ordered to sell his share in the land to the plaintiff? (O. P.)
Onus objected to but over-ruled vide para 269, Mulla's Hindu Law, 9th Edition.
6. In case it is found that the defendants do not form a joint Hindu family and the alleged agreement to sell is proved is not defendant No. 1 liable to part with his share in the land in dispute in favour of the plaintiff?
7. Whether defendant No. 4 was present at the time of the alleged agreement to sell and consented to it and is bound by the same?
2. The trial Court came to the conclusion that defendant No. 1 had on his own account and as the karta of the joint Hindu family consisting of the defendants entered into an agreement of 1-10-1945 to sell the land in dispute to the plaintiff at Rs. 250/- per marla; that defendants Nos. 2 to 4 were members of the pint Hindu family along with defendant No. 1; that the property in question was the property of the joint Hindu family consisling of the defendants; that the alleged sale was not for the benefit of the joint Hindu family and was therefore not binding on defendants Nos. 2 io 4.
The trial Court also found that the transaction could not be enforced against the share of defendant No. 1 in the property in question and that although defendant No. 4 was present at the time of the alleged agreement to sell, he did not give any consent to the sale in question. On the aforesaid findings the trial Court dismissed the plaintiff's suit on 26-6-1950 leaving the parties to bear their own costs. The plaintiff has come up to this Court in first appeal.
3. It must be ncted that the learned counsel for the parties did not contest the findings of the trial Court on issues Nos. 1, 2, 3, 5 and 6. Mr. Shamair Chand, learned counsel for the appellant, mainly contended that the sale in question had been made for the benefit of the joint Hindu family and that Sat Pal who was present at the time of the sale was actually consulted & had consented to the sale. As pointed out by the learned trial Court no such plea had been taken by the plaintiff in the plaint. Defendants Nos. 2 to 4 pleaded in their written statement that the alleged sale was not for benefit of the family. On 3-4-1947 the trial Court recorded the statement of Balmukand plaintiff and it was in that statement for the first time that the plaintiff pleaded the .sale to be for the benefit of the family. The exact words in which the plea was taken are:
'Defendants Nos. 1 to 4 form a joint Hindu family of which defendant No. 1 is the karta. The defendants wanted to sell the land as it was fetching good price. The defendant No. 1 did not disclose any necessity for the sale. He told me that the land on partition will be of little use to them. Defendant No. 1 said that the sale deed will be executed after he can get copies of the jama-bandi'.
4. It is proved on the record from the evidence of P. Ws. 9, 10 and 11 and of the plaintiff himself as P. W. 12 that on 1-10-1945, Balmukand plaintiff purchased 23/120 share belonging to one Devi Sahai in the joint Khata in dispute and that the sale deed for the same was scribed by P. W. 9 Bua Das Petition Writer of Batala. That transaction had been brought about by two brokers Ved Prakash P. W. 10 and Narinjan Das P. W. 11 who were also present at the time the sale deed of 23/120 share was being scribed in the court compound by Bau Das.
Pindi Das and Sat Pal defendants had also come to Bua Das at that particular time for the purpose of getting some plaint writfen by him. Pindi Das on learning that the plaintiff had purchased 23/120 share of the land inquired from the brokers as to what price had been paid for the land. On being told that the land bad been purchased by the plaintiff at Rs. 175/- per marla, Pindi Das offered to the brokers that if the plaintiff was willing to purchase their 3/2 share at the rate of Rs. 250/- per marla, they would be willing to sell it. The brokers then contacted the plaintiff who showed his willingness to purchase the share of the defendants at the rate of Rs. 250/- per marla.
The plaintiff was already a co-sharer in the joint khtita in question. With the purchase of 23/120 share, the plaintiff had completed his title to 17/20 share of the joint land and the only share of this land which still remained with others was 3/20. It was this share that the defendants had offered to the plaintiff and with the purchase of this share the plaintiff would have become a complete owner of the khata. The plaintiff naturally wishing to become the complete owner accepted the offer of the defendants and paid Rs. 100/- as earnest money to Pindi Das who accented the same find concluded the contract as Karta of the. joint Hindu family. Sat Pal being present there was consulted by Pindi Das.
Sat Pal says that he did not give any consent to the transaction, but the brokers P. W. 10 and P. W. 11 swear that he gave his consent. In any case, it appears that both parties felt satisfied with this contract of sale inasmuch as the plaintiff acquired title to the small portion which was not with him and thus completed the purchase of the entire khata and the defendants got Rs. 250/- per marla as price of the land which was being sold that very clay at the rate of Rs. 175/- per marla and which they had purchased in 1939 per Exhibit P. 5 at a very insignificant price. It is not understood as to what led Pindi Das and his brothers to change their mind later. It may be that defendants Nos. 2 and 3 did not agree to this sale or it may be that the defendants decided to retain this small share of the joint khata with a view to compel the plaintff to pay higher price at some later time.
We cannot, however, go into the realm of conjectures Non~ of the parties has given any reason why the transaction was not completed. The plaintiff, after waiting for considerable time, was compelled to bring the present suit and all the defendants chose to contest it. The suit has been dismissed by the trial Court mainly on the ground that it was not proved that the sale was for the benefit of the estate and was as such not binding on all the defendants. The sole point that arises in the appeal therefore is, whether on the facts and in the circumstances of the case the sale is proved to be for the benefit of the estate.
5. Mr. Shamair Chand drew our attention to paragraph 243A of Mulla's Hindu Law and contended that the words 'for the benefit of the estate' which occur, in the judgment of the Judicial Committee in Hunnoman Persad Punday v. Mt. Babooee Munsraj Koonweree,6 Moo. lad. App. 393 (PC) (A), are not merely restricted to transactions of defensive character calculated to protect the estate from some threatened danger or destruction, and are wide enough to include all such transactions which a prudent owner or rather a trustee may carry out with the knowledge that was available to him at the time of the transaction.
His argument is that in each case it is a question of fact whether a particular transaction is for the benefit of the estate, and the test to find out the same is whether a prudent owner or trustee would enter into the transaction in question with the knowledge of all the circumstances existing at the time. He contends that Pindi Das and Sat Pal made this offer to sell the land in question at Rs.250/-per marla because they knew that portions of the same khata were being sold on the same day for Rs. 175/- per marla and that the transaction would bring them Rs. 10,000/- instead of the market value of Rs. 7,000/-.
He further contends that the defendants were only owners of a very small portion in the joint khata and were not earning any income from the same. His case indeed is that Pindi Das and Sat Pal who arc businessmen sold the land clearly with the object of obtaining hard cash amounting to Rupees 10,000/- in lieu of a dead asset yielding at the moment nothing to the family and not liekly to yield anything till the land was partitioned during the lengthy course necessarily involved in such partitions by the revenue officers.
Mr. Shamair Chand, however, cannot take the matter any further. He concedes that besides the point that the price obtained by the sale was Rs. 75/-per marla more than the market value on that day, there is nothing else to prove henpfit lo the estate. There i.s neither any plea nor any evidence to show how the sale money was to be utilised, and whether it was at all needed by the family for any purposes of the same. He has drawn our attention to Jagat Narain v. Mstrmrn Das, ILR 50 All 969: (AIR 1928 All 454) (F. B.) (B), Hayat AH Shah v. Nem Chand, AIR 1945 Lab. 169 (FB) (C), Atma Ram v. Sadhu Singh, AIR 1938 P. C. 77 (D), and also fo an unre-ported judgment in Swarn Kumar v. Munshi Ram etc. Second Appeal No. 175 of 1948, deeded by Kapur J. on 5-6-1951 (Punj) (E). The facts of these rulings are distinguishable and in none of them was it held that the mere fact that the manager of the family obtained more price was by itself sufficient to find that the sale was made for the benefit of the estate.
6. In ILR 50 All. 969: (AIR 1928 All 454) (B) the adult manager of the family had found it very inconvenient and to the prejudice of the family's in-terest to retain property eighteen or nineteen miles away from Bijnore to the management of which neither of them could possibly give attention & they had considered it to the advantage of the estate to sell that property and purchase other property at a more accessible situation. It had also been found that the property was sold at very advantageous terms although in unfortunate incident happened that the Bank where the money was deposited closed its doors. The sale was clearly an act of good management and the purpose was to sell property which could not be managed, and with the sale money thereof to purchase property which the family could manage.
7. In AIR 1945 Lab. 169 (F. B) (C) the facts found were that the joint Hindu family in that case was dependent on trade and originally owned a provision shop in or near the Chandni Chowk, Delhi, This state of affairs continued fill about the year 1928, The provision shop was then given up and a cycle shop was started and the whole family was dependent on the income received from this shup. In the beginning of 193S a sum of Rs. 2, 300/- was borrowed from one Thakar Das on the security of ancestral property of the joint Hindu family and later in the same year this property was again mortgaged by the manager of the family for obtaining some money. The objects of the loan were that the family wished to extend the scope of its business by selling peram-bulators and manufacturing rubber solution in addition to the cycle business. It was found by the Full Bench that the mortgages in those circumstances were for the benefit of the estate.
8. In the unrepwfed judgment of Kapur J, in S. A. No. 175 of 1948 (Punj) (E) the facts were that Madan Gopal, Manager of the family, was a State servant on Rs. 50/- a month and bad three sons and three daughters. He gave up service because be was unable to pull on with the meagre salary and joined his nephew Surrendar Nath in cloth business which Surrender Nath was previously carrying on. The property at Ferozepore which Madan Gopal was finding difficult to manage was sold off for the purpose of investing the money on the cloth business and the trial Court and the Dis-trict Judge both found on evidence that the act of Madan Gopal was an act of good management and that by investing the money obtained by sale of the propctty he was able to carry on the business and was thus able to maintain his growing family. Kapur J. found that the findings of the Court's below were findings of fact and tiiat in the circumstances of the case the sale of the pioperty was for the benefit of the estate.
9. AIR 1938 PC 77 (D) related to an agriculturist governed by custom. The facts found in that case were that the vendor was not able to manage the cultivation of his land and was very much indebted with the result that he was not even able to pay the land revenue and in those circumstances be sold the land to a non-agriculturist with the sanction of the Deputy Commissioner. On these facts it was found that the sale was an act of good management and could not be attacked by his sons.
10. The facts of the present case arc entirely different. The plaintiff has not been able to prove any benefit to the estate. He has only proved that Pindi Das was able to sell the land at a rate much higher than the market rate. Tin's by itself is not a benefit to the estate, In the absence of any further fact that the money utilised by the sale was needed by the family or was utilised for the purposes of the family, we feel that the turning of a stable asset like immovable property of the family into cash which was to be realised by the then manager of the family could not by itself be for the benelit of the estate.
11. Mr. Daulat Ram Manchanda, learned counsel for the respondents, drew our attention to a Full Bench authority of the Bombay High court reported in Hem Raj v. Nathu, ILR 59 Bom 525: (AIR 1935 Bom 295) (F), where almost a similar point was decided. Sir John Beaumont C. J. who delivered the main judgment in that case observed at pages 543 and 544 of the report as under:
'In my opinion, the view taken by the Full Bench of the Allahabad High Court in ILR 50 All 969 : (AIR 1928 All 454) (B), that the question turns on what a prudent owner would do in dealing with his own estate goes too far, and there is no justification in Hindu Law for saying that the manager of a minor can sell the minor's property solely on the ground that if he were the owner ot the property he would as a prudent man sell it. I may point out that the question whether a transaction is for the benefit of an estate or not involves the consideration of something more than merely whether the purchase price paid is a good price; it involves the further question of what is to be done with the purchase money. In the present case the purchase money was invested in business, so that the ultimate result of the transaction was that the minor, in place of a piece of land worth Rs. 600/-, had an interest costing Rs. 900/- in a business; but whether that interest was worth more than Rs. 600/- does not appear on the evidence. To sell a piece of land at a very good price would not be beneficial if the purchase money was to be invested in an insolvent business. However, apart from that consideration, in my opinion, the manager of a minor under Hindu law is not entitled to sell merely for the purpose of enhancing the value of the property of the minor, or for increasing the minor's income. On the other hand I am not prepared to go quite so far as Mr. Justice Patkar went in Ragho v. Zaga Ekoba, ILR 53 Bom 419: (AIR 1929 Bom 251) (G), and to say that no transaction can be for the benefit of the minor which is not of a character to protect cr preserve property of the minor. It would generally, I think, be difficult to justify a sale not of that character, but I can conceive of cases not of that character in which the facts might nevertheless be of such a compelling character that any Court would hold the transactions to be for the benefit of the estate, e. g., the sale of land which could not conveniently be cultivated with other property of the minor, and the investment of the purchase money in lands which could be so conveniently cultivated, assuming of course that the price obatined, and tine price paid, were proper; or the sale of lands in order to raise money to secure irrigation or pemanent improvement of the other lands of the minor; or a beneficial exchange; or a case like the one in Nagindas Maneklal v. Mahomed Yusuf, ILR 46 Bom 312: (AIR 1922 Bom 122) (H), where it was necessary to sell in order to prevent the disruption of the property. In the present case there is nothing to justify the sale except the fact, which I accept, that the price obtained was greater than that which would normally be obtained in the market. Apart from the fact that we have no satisfactory evidence as to the manner in which the purchase money was to be dealt with, I think that a sale of that character and for that purpose is not justified by the cases to which I have referred. That being so, I think the appeal must he allowed'.
12. We have no doubt that this is the correct exposition of law, and with great respect we follow the ratio decidendi of the said case and find. that the sale in question was binding on defendants Nos. 1 to 4. The plaintiff cannot be granted a decree for specific performance of the contract in question because the property in suit belongs to the joint Hindu family and Pindi Das, manager of the family, was not entitled to sell it except for the benelit of the estate.
13. We, however, feel that there was no justification for the defendants retaining Rs. 100/- as earnest money. Mr. Shamair Chand submits that the defendants should be directed to refund this amount with interest at 6 per cent per annum from the date they received the amount to the date when they actually pay. We feel that this request is quite reasonable in the circumstances of the case. We do not approve of the conduct of Pindi Das and We strongly condemn the attitude adopted by him in this suit and the false allegations which he made in the written statement and in his evidence. Pindi Das has been withholding this amount of Rs. 100/-wrongfully. He is said to have died during the pendency of the appeal. His estate is bound to relund Rs. 100/- along with interest at 6 per cent per annum from 1-10-1945 to the date of actual payment to the plaintiff.
14. We, therefore, modify the decree of the trial Court and dismissing the plaintiff's suit for specific performance pass a decree in favour of the plaintiff for Rs. 100/- along with interest at 6 per cent per annum from 1-10-1945 to the date of its payment to the plaintiff. This amount will be recoverable from the estate of Pindi Das. The parties shall bear their own costs throughout.