Skip to content


G. Srinivasalu Naidu and ors. Vs. Raju Naicker and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty;Contract
CourtChennai High Court
Decided On
Case NumberLetters Patent Appeal No. 121 of 1951
Judge
Reported inAIR1955Mad635
ActsHindu Law
AppellantG. Srinivasalu Naidu and ors.
RespondentRaju Naicker and ors.
Appellant AdvocateV.C. Veeraraghavan and ;S. Thyagarajan, Advs.
Respondent AdvocateG.R. Jagadesan and ;T.V. Balakrishnan, Advs.
DispositionAppeal dismissed
Cases ReferredVeeraswami v. Narayya
Excerpt:
.....and the first defendant, the manager of the joint family of defendants executed an agreement of reconveyance in favour of the plaintiffs. in a suit filed by the plaintiffs for specific performance of the agreement to reconvey, it was contended that the agreement was not binding on the members of the family as it was not justified by any family necessity or benefit.; held, the sale deed and the agreement to reconvey were parts of the same transaction as they were both executed in fulfilment of a single contract and the agreement was part of the consideration for the sale. the agreement to reconvey being part of the arrangement under which the sale was executed should not be treated as so distinct and separate from the sale itself as to require necessity or benefit to support..........for specific performance. the material part of this agreement runs as follows:"i have obtained a sale deed for rs. 5000 from you in respect of the undermentioned family properties belonging to you for our family in the name of my undivided younger brother kesavahi naidu on the aforesaid date. if as requested by you, you should pay the sale amount at any time within a period of ten years from now, we shall receive the said amount and myself and my younger brother kesavalu naidu mentioned above shall reconvey the said properties to you absolutely by means of a sale deed after receiving the above mentioned amount."it was further recited that the first defendant as family manager had full authority to execute the agreement. before us, it was not disputed that the suit properties were.....
Judgment:
1. To decide the only question which has been placed before us in this Letters Patent Appeal against the judgment of Viswanatha Sastri J., in A. S. No. 287 of 1947, it is sufficient to state the following facts: The defendants are the appellants. The suit was for specific performance of an agreement to reconvey the suit properties. Plaintiffs 1 to 3 are brothers, and plaintiffs 4 to 6 are their sons. Defendants 1 and 2 are brothers and defendants 3 and 4 their sons.

By a deed of sale dated 9-5-1937 (Ex. D-18) executed by the plaintiffs, the suit properties were conveyed to the second defendant. On 14-5-1937, the first defendant executed in favour of plaintiffs 1 to 3 an agreement of reconveyance (Ex. P-1), which is the basis of the present suit for specific performance. The material part of this agreement runs as follows:

"I have obtained a sale deed for Rs. 5000 from you in respect of the undermentioned family properties belonging to you for our family in the name of my undivided younger brother Kesavahi Naidu on the aforesaid date. If as requested by you, you should pay the sale amount at any time within a period of ten years from now, we shall receive the said amount and myself and my younger brother Kesavalu Naidu mentioned above shall reconvey the said properties to you absolutely by means of a sale deed after receiving the above mentioned amount."

It was further recited that the first defendant as family manager had full authority to execute the agreement. Before us, it was not disputed that the suit properties were purchased under Ex. D-18 for the joint family of the defendants, though the sale deed itself was taken in the name of the second defendant. It was also admitted that the first defendant in executing Ex. P-l was doing so on behalf of the family as its manager.

On these facts, it was contended for the defen-dants-appellants in the trial Court and before Viswanatha Sastri J., and the contention was repeated before us, that the agreement for reconveyance executed by the first defendant was not binding on the other members of the family, as it was not justified by any family necessity or benefit. The basis of the contention was that the sale and the agreement to reconvey were two independent transactions and as the properties wore purchased for the benefit of the family of the defendants, any sale of joint family property by its manager could be binding only if it was for necessity or benefit.

The learned Judge, Viswanatha Sastri J. held that the sale and the agreement to reconvey should be considered as parts of the same transaction and they were both executed in fulfilment of a single contract. He found that the agreement to reconvey was a part of the consideration for the sale. In such cases, it would be impossible to prove necessity or benefit for the agreement to reconvey, standing by itself, and the agreement to reconvey need not be justified by family necessity or benefit any more than the sale to the family.

On this reasoning, he rejected the contention of the defendants. An unreported decision of Govinda Menon J. in S. A. No. 851 of 1946 (Mad) (A) was relied upon, but the learned Judge found himself unable to follow it.

2. Learned counsel for appellants again pressed before us the contention that the sale and the agreement to reconvey were two different transactions to be judged separately. In support of this contention, be relied strongly on the decision of the Privy Council in -- 'Veeraswami v. Narayya', AIR 1949 PC 32 (B), which had also been relied upon by Govinda Menon J. It is necessary, therefore, to deal with that case at some length.

In that case, the appellant and his father sold certain properties to the respondents for Rs. 6,000 and a sale deed was executed on 30-11-1932. iN 1940 the appellant, alleging that, when the properties were sold it was verbally agreed that they should be reconveyed if the purchase price was repaid within a period of five years, which was later extended for a further three years, instituted a suit against the respondents for specific performance of the alleged oral agreement to reconvey. The evidence established that there was such an oral agreement.

It was, however, contended that the appellant was precluded by Section 92, Evidence Act, from adduc-ing evidence of such an agreement. Their Lordships of the Judicial Committee overruled that contention on the ground that Section 92, Evidence Act, did not preclude evidence of such an agreement because the agreement did not contradict, vary or subtract from the terms of the sale deed within the meaning of that section; nor did the agreement add to the terms of the sale deed. The decision was, therefore, on the applicability of Section 92, Evidence Act, to the facts before them.

In dealing with the objection based on that section, there Lordships observed that the sale and agreement to reconvey should be treated as separate and independent transactions, that is to say, that the terms of each should be taken separately. The following observations of their Lordships only lead on to the discussion of the only question which fell for decision:

"In their Lordships' opinion, the correct way of stating the position is to say that the agreement reached covered several matters but that the intention was that each of these should be effected as a separate and independent transaction. There was to be an outright sale and that, upon the happening of a certain event, was to be followed by a reconveyance of what had been sold. The second transaction, by its very nature, premised the previous completion of the first.

Both, it is true, may be taken as arranged at the same time and agreement upon one part of the bargain may well have promoted agreement as to the rest, but such considerations do not necessarily affect the final result of the bargaining. The determining factor lies in the ultimate shape of the agreement rather than in the process by which it is reached."

Immediately after these observations, their Lordships , proceed to say:

"Such being the character of the agreement in q uestion, their Lordships find it impossible to hold at it contradicted, varied or subtracted from the terms of the Kale deed. On the contrary, it left those terms and the interest passing thereunder to the purchaser entirely unaffected. Can it then be said to nave added to the terms of the sale deed?

The words 'adding to' which are part of Section 92, must receive their due weight, but in the opinion of their Lordships they do not suffice to exclude the oral agreement relied upon by the appellants."

We fail to see how this decision has any bearing, direct or indirect, on the question to be decided by us in this case, namely, whether an agreement to reconvey, which was a part of the arrangement under which the sale deed was executed, should be treated as so distinct and separate from the sale itself as to require necessity or benefit to support it.

3. We shall now refer to the judgment of Govinda Menon J., in S. A. No. 851 of 1946 (Mad) (A). The decision itself does not assist the appellants. The first defendant in the case before him, who was the manager of a joint family, purchased with funds belonging to the joint family certain property, by a sale deed dated 17-5-1939. On the same day, he executed in favour of the vendor an agreement to reconvey the property for the same consideration, in case demand was made within four years from the date. The vendor brought a suit for specific performance of this agreement of reconveyance.

The suit was resisted inter alia on the ground that it would not be binding on the other members of the family as it could not be supported by necessity or benefit to the family. The Courts below found that both the sale and the agreement to re-cenvey were parts of the same transaction, and therefore, the agreement to reconvey was binding on the other members of the family. The learned Judge relied on the decision of the Privy Council in AIR 1949 PC 32 (B) above mentioned, and held that the two should be treated as different transactions and each had to be considered in its own setting. He then proceeded to say:

"It might be that part of the bargaining by which the purchase under Ex. D-1 was effected might be the agreement to reconvey, in which case it could not be said that by Ex. P-1, no benefit was conferred upon the joint family. This is a matter which depends entirely upon the evidence adduced in the case."

He, therefore, remanded the suit to the Court of first instance for fresh disposal. It is clear that the learned Judge was inclined to hold that if the agreement to reconvey was part of the bargaining which culminated in the sale, then the agreement to re-convey could be supported on the ground of benefit to the family. This view does not certainly help the appellants in view of the evidence in this case, which shows that the agreement to reconvey was part of the bargain.

There are, however, certain observations in the course of his judgment with which we are unable to concur, with all deference to the learned Judge. These observations relate to the effect of the Privy Council decision in AIR 1949 PC 32 (B). As we have explained above, the only question of law before their Lordships of the Judicial Committee was whether the oral agreement to reeonvcy could be availed of, having regard to Section 92, Evidence Act. Their Lordships set out the question thus:

"On the wording of this enactment (S. 92) the question under discussion comes to this--does the oral agreement as to reconveyance contradict, vary, add to or subtract from the terms of the sale deed?" All that their Lordships decided was that the agreement did not offend the provision of Section 92. It is in this context that they described the sale and the agreement to reconvey as being separate and independent transactions. Govinda Menon J. thought that the decision compelled him to hold that this should be the approach for every purpose.

But, as we have said, these observations did not materially affect the ultimate decision of the learned Judge, because he was of opinion that if the agreement to reconvey was part of the bargaining by which the purchase was made, then the agreement would be binding on the family. The appellants' contention, therefore, fails.

4. Learned counsel for the appellants raised another contention, namely, that if the agreement to reconvey executed in favour of plaintiffs 1 to 3 should be treated as an agreement executed in favour of all the members of the family, then it is unenforceable, because there could be no mutuality as three of the members of the plaintiffs' family were minors on the date of the agreement. This contention was admittedly not raised at any time before, and we see no reason why the appellants should be permitted to raise a new point at this late stage.

5. The Letters Patent Appeal is dismissed with costs.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //