1. These appeals arise out of cross suits and as they relate to the same transaction, they may be conveniently dealt with together. A.S. No. 64 arises out of a suit for specific performance instituted by the vendor. A.S. No. 65 arises out of a suit instituted by the intending purchasers for getting refund of the advance paid by them in pursuance of the contract of sale. It will be convenient to refer to the parties by their position in A.S. No. 64. It is common ground that on 20th August 1929, the parties entered into the agreement, Ex. A for the sale and purchase of about 1,31 acres of land for Rs. 10,100 and that the defendants paid Rs. 1000 in cash as advance. The document provided that the sale should be completed before the end of June 1930. For reasons which it is unnecessary to go into now, the transaction was not so completed and there was a revised contract between the parties on 25th July 1930 (Ex. B). The price was reduced by Rs. 1000 and the time for completion was extended to 25th August 1930. Even this contract was not carried out in due course and after protracted correspondence, in the course of which each party blamed the other, the vendor instituted the suit for specific performance on 18th August 1932. The vendees instituted the suit for the refund on 25th July 1933.
2. In the form which the controversy ultimately assumed, the principal question for decision turned out to be whether the plaintiff was in a position to convey a title free from reasonable doubt. Contentions were also raised as to whether it was open to the defendants to question the nature of the plaintiff's title and whether the defendants had not themselves been guilty of breach of contract. In the suit for the refund of the deposit, questions were raised as to the right of the purchasers to claim refund and as to their right to claim interest. While holding that to a certain extent the purchasers were responsible for the failure of the transaction, the lower Court nevertheless held that they were entitled to insist upon the plaintiff making out a good title and that the plaintiff had failed to do so. In the result, the specific performance suit was dismissed and the purchaser's suit was decreed; but, in the circumstances, the lower Court disallowed the costs of the purchasers and also declined to allow their claim for interest. Against these decrees, appeals have been preferred by the vendor. The purchasers have filed memoranda of objections.
3. The learned Counsel for the appellant attempted to maintain that it was clear from the conduct of the parties that the purchasers had knowledge of the source and the nature of the plaintiff's title as one of them had been connected with an earlier transaction of the plaintiff and the deed of partition Ex. G, under which the plaintiff claimed title had been referred to in the contracts of sale, Exs. A and B. But, as pointed out by the learned District Judge, the mere fact of knowledge on the purchasers' part of these earlier transactions will not disentitle the purchasers to insist upon proof of the vendor's title unless they had agreed to limit the nature of the inquiry into title or had agreed to accept the title of the vendor such as it was. We cannot accede to the contention that the purchasers in this case had agreed to accept whatever title the plaintiff had, even if it was defective. The plaintiff's husband examined as P.W. 1 admitted that the contract was to sell and purchase an absolute title to the property. And the price agreed upon, namely, Rs. 10,100 for the 1.31 acres, clearly shows that the bargain must have been in respect of an absolute estate and not merely for the limited estate of a Hindu daughter in her father's property.
4. The learned Counsel for the appellant next contended that even if the nature of the title that the plaintiff could convey was open to investigation, the title shown by her in this case was free from reasonable doubt. In dealing with this contention, it is necessary to refer to the nature of the title. The plaintiff derived title under an arrangement (evidenced by Ex. G) entered into between the plaintiff, her mother Mangamma and one Ramajogayya who claimed to have been adopted by Mangamma to her husband in January 1894. Man-gamma's husband died in June 1893; and the story as now narrated in the evidence is to the effect that on the evening before the day of his death, Mangamma's husband had orally authorized his widow to take a boy in adoption. There is admittedly no deed of adoption, and we are therefore not in a position to say on what authority the adoption purported to be made. Ex. G refers to the fact that in 1895 Ramajogayya filed a suit in the Munsif's Court against Mangamma, for relief on the footing of his adoption but that plaint was returned for presentation to the proper Court, as it was found that the suit was beyond the jurisdiction of the District Munsif's Court. Admittedly the plaint was not afterwards represented; and the evidence shows that between 1895 and 1906, Mangamma continued to deal with her husband's property as if she was the sole owner and in disregard of the rights of the alleged adopted son. It, however, appears that in 1906, when Ramajogayya is said to have attained majority, P.W. 1, the husband of the plain, tiff, brought about an amicable settlement of the disputes between the alleged adopted son on the one hand and his adoptive mother and his sister on the other, with a view to avoid future litigation. The substance of the arrangement was that Man-gamma and her daughter, the plaintiff, took one-third each in the husband's estate and the remaining one-third was taken by Ramajogayya. The document recites that each of the sharers should take his or her respective share with absolute rights. It is on the terms of this document that the learned Counsel for the appellant contends that it makes out an absolute title in the plaintiff free from reasonable doubt. We are unable to agree with this contention.
5. It is not sufficient that as a matter of language, the estate conveyed to the daughter under the arrangement above set out is expressed to be an absolute estate. It is only if the parties who entered into this arrangement were entitled to an absolute estate or entitled to confer on the plaintiff an absolute estate that the arrangement can prevail as against the reversionary heirs to the estate. The doctrine of bona fide settlement which has been invoked in this connexion cannot help the plaintiff. The utmost that can be said is that Ramajogayya put forward a claim based on an alleged adoption and to that extent there was a bona fide settlement of disputes; in accordance with the decision of the Privy Council, it may be possible to say that the allotment of a share to him as a result of such settlement cannot be questioned by the reversioners. But so far as Mangamma or the plaintiff purported to enlarge their limited interest into an absolute estate by the provisions contained in the document, there is no scope for the application of the rule as to bona fide settlement. The judgment in Nathu Lal v. Babu Ram brings out this distinction. The widow may no doubt act as the representative of the estate in settling the claim of the alleged adopted son but she is not acting as representative of the estate in enlarging her own interest. As regards the plaintiff in the present case, she had no 'claim' at all to be settled at the date of Ex. G because her mother was then alive. It is only if there is independent proof that the other party to the arrangement had a right to confer upon the widow or on the daughter a larger interest than she would have taken as heir to the last male holder that the arrangement will be effective to give her such higher interest as against those claiming to succeed to the estate as reversionary heirs on her death. The decision above referred to no doubt shows that the mere fact of the female holder having in the first instance claimed only as 'heir' does not preclude the possibility of her getting an absolute interest under the arrangement; but the effectiveness of the arrangement to confer such absolute estate will depend not upon the terms of the settlement itself but upon the competency of the other party to the settlement to confer such absolute estate.
6. We have accordingly to consider whether apart from the terms of Ex. G, there is independent evidence in the case to establish that Ramajogayya was in a position to confer an absolute interest on the plaintiff in one-third of the estate as he purported to do under Ex. G. It is admitted that he could have done so only if his adoption was true in fact and valid in law. The defendants denied the factum as well as the validity of Ramajogayya's adoption. The learned District Judge was of the opinion that the adoption was probably true in fact but he held that it was not valid in law, because the husband's oral authority had not been proved. In the view we take on the question of the validity, it is unnecessary to deal with the question of the factum. The learned Counsel for the appellant pressed us to apply to the present case the presumption which their Lordships of the Judicial Committee held to be applicable to ancient adoptions, in Venkata Seetharamachandra Rao v. Kanchumarthi Raju , namely that an adoption which has all along been recognised by the members of the family and other relations and which has been acted upon for a long time without question must be presumed to have been duly authorised. The circumstances of the present case however make in impossible for us to invoke that presumption here. As Ex. G itself shows the widow who is said to have made the adoption repudiated it and the alleged adopted son was obliged to file a suit to assert his rights. But this suit was not persisted in and though in that suit the widow denied the factum as well as the validity of the adoption, no steps were taken by the adopted son to assert his claim till 1906. It is admitted in the course of the oral evidence that the adopted son never lived with the adoptive mother nor did he enjoy any portion of the adoptive father's estate till 1906. Even the hereditary office which the adoptive father had held during his lifetime, the adopted son was able to get only after 1906 presumably as a result of the settlement under Ex. G. It is true that after the date of Ex. G the adopted son had been in peaceful possession of the one-third share of the estate allotted to him and has dealt with the property as his own. This by itself cannot lead to any inference 'as to the validity of the adoption. Such conduct obviously rests upon Ex. G itself which was binding as between the parties. The widow Mangamma was alive till after the institution of the present suit; the daughter is still alive and she has sons.
7. There was thus no occasion for any person interested in the estate to dispute the adoption when the parties to Ex. G had settled their disputes between themselves. The circumstances of this case do not therefore warrant the application of any presumption based on the long course of conduct consistent only with the truth and the validity of the adoption. It is also significant, for what it is worth, that in Ex. G a clause was in terms first inserted recognising the adoption, but for some reason which the parties have not explained that clause was deleted before the document was executed. More significant still is the way in which the case as to authority seems to have been put forward. We do not have on record a copy of the plaint filed by Ramajogayya in 1895. There is accordingly no direct evidence of the case then set forth. But Mangainma who is now supporting the story of adoption stated in cross-examination in this suit that the adoptive son's case was then rested upon consent given by the gnatis and not upon an alleged oral authority of the husband. In the absence of any other evidence on the point, we see no reason to reject this testimony as to the nature of the case then put forward. The present case of oral authority given by the husband is at variance with that case. The oral authority is now sought to be supported by the evidence of three or four witnesses whose evidence the learned trial Judge has declined to accept. We see no reason to differ from him on this point.
8. It was next pointed out that Ex. G had been attested by a number of respectable people in the village including two of the reversioners, one a presumptive reversioner and the other a remoter reversioner and it was argued that this was a circumstance warranting the inference that to the knowledge of everybody Ramajogayya was the validly adopted son. We do not think that any such inference will be warranted. It may be that persons interested in the family or respectable people of the locality would have been called in to see the disputes between the parties settled and so long as this was done they were not concerned with the relative rights of the parties. On the other hand, there is the fact that several of the attestors to Ex. G have attested documents executed by the widow between 1895 and 1906 whereby she purported to deal with the property in total disregard of the rights of the alleged adopted son.
9. We may also observe that the circumstances of the plaintiff's father at the time of his death were by no means such as to probabilize the oral authority. He was then a young man of 25 who died leaving a widow aged 18 and the plaintiff who was then an infant and his mother also survived him. It appears from the evidence that he had long been suffering from dropsy. If he was at all of a religious turn of mind or the influence of those around him inclined him in that direction, there was ample opportunity for him to leave written instructions as to the enjoyment of the property and the perpetuation of his lineage by adoption. This is all the more probable in view of the extent of his property and of his position as the holder of an office. No such step having been taken, it seems to us by no means unlikely, in view of his age, that he did not think very seriously of these religious purposes and as he left a daughter it is hardly likely that he would have placed the daughter at the mercy of a son to be adopted without specific directions for her benefit. We must accordingly hold that the plaintiff has failed to prove that Ramajogayya had been validly adopted and was in a position to confer an absolute estate on the plaintiff as he purported to [do under Ex. G.
10. In the above view, it does not seem to us necessary to refer at length to the decisions to which the learned Counsel for the appellant drew our attention, as to the test to be applied in determining whether the vendor is able to convey a title free from reasonable doubt. The test is expressly laid down in Section 25 (b), Specific Relief Act, and it will not be safe to attempt to paraphrase it. We may however observe that the observations in Emery v. Grocock (1821) 6 Madd. 54, Mullings v. Trindar (1870) 10 Eq. 449 and Mogridge v. Clapp (1892) 3 Ch. 382 to which the learned Counsel drew our attention, far from supporting him clearly go to show that when a vendor's title depends not upon a question of law but upon proof of a disputed fact, that fact must be proved, and if the vendor does not prove it, he cannot be held to have made out a good title. To the same effect is the rule stated in Williams on Vendor and Purchaser at page 1011 of the 1906 edition. Under the heading 'questions of fact' the author concludes the discussion as follows:
It appears that where there is a real ground of suspicion of some matter which would cause a defect in the legal title to the property sold, the Court may, unless the suspicion be removed by sufficient evidence, pronounce the title to be too doubtful to be forced on the purchaser, or may at least do so if its acceptance would leave him exposed to the reasonable probability of adverse litigation.
11. Mr. Satyanarayana Rao attempted to bring this case within the authority of the decisions which say that where the circumstances will justify a Court in instructing a jury to draw a presumption in favour of the, plaintiff's title, the Court will hold the plaintiff's title to be free from reasonable doubt. And it is with this purpose in view that he relied on the decision in Venkata Seetharamachandra Rao v. Kanchumarthi Raju as laying down a presumption in favour of the validity of ancient adoption; but for the reasons which we have already explained, we are unable to hold that any such presumption can be drawn in this case. We accordingly hold that the lower Court was justified in dismissing the suit for specific performance. As regards the memorandum of objections in A.S. No. 64, we see no sufficient ground for interfering with the lower Court's direction as to costs in O.S. No. 68 of 1932. Mr. Somayya contended that the terms of Section 18 d), Specific Relief Act, deprived the Court of any discretion in the matter of costs if the vendor's suit for specific performance is dismissed on the ground of imperfect title. We are unable to interpret Section 18(d) in that absolute manner. Section 35, Civil P.C., which provides that the costs of an incident to all suits shall be in the discretion of the Court is no doubt made subject to the provisions of any law for time being in force. But it seems to us unreasonable to hold that Section 18(d), Specific Relief Act, lays down an absolute rule, independent of the conduct of the purchasers as defendants in the course of the specific performance suit. The object of Section 35, Civil P.C., is clearly to enable the Court to award costs in the light of the conduct of the parties in the suit. In the pre-sent case, the learned Subordinate Judge has found that on some points the contentions of the purchasers were not true and that they either had not the whole amount of money required to enable them to complete the contract or for some other reason they decided to resile from the contract. In these circumstances, we think the lower Court was justified in declining to award costs in their favour, though it dismissed the vendor's suit for specific performance on the ground of defect of title.
12. It follows from the findings above recorded that the purchasers were entitled to the refund of the advance of Rs. 1000 paid by them. Mr. Satyanarayana rao relied on the observations in Soper v. Arnold (1889) 14 A.c. 429 . The speeches delivered in that case clearly show that the House dealt with it as a case in which if a suit for specific performance had been instituted the purchasers would have had no defence to the suit. That is not the position here. On the other hand, it is clear from the observations of the Judicial Committee in Low & Co. Ltd. v. Jyoti Prasad Singh Deo , that practically the same considerations govern the question of the grant of specific performance to the vendor and of directing the refund of the deposit to the purchaser. This is in effect the provision in Section 18(d), Specific Relief Act. We may also mention that the payment of Rs. 1000 is referred to in Ex. A not even as a deposit but only as advance. The argument sometimes founded on the use of the word 'deposit' will not therefore avail in the present case. A.S. No. 65 of 1935 accordingly fails.
13. In the memorandum of objections filed in this appeal, the purchasers object to the lower Court's disallowance of costs to them and also to the lower Court's disallowance of interest on the sum of Rs. 1000 for the period anterior to the institution of the suit. As regards the costs in the lower Court we are not prepared to interfere with the lower Court's decision but as regards interest, we find no reason given by the learned Subordinate Judge for the disallowance of interest. Prima facie, the purchasers are entitled to interest under the terms of Section 18(d) and we see nothing in their conduct to disentitle them to the same. We accordingly hold that they are entitled to interest on the sum of Rs. 1000 at 6 per cent, per annum from the date of Ex. B, that is 25th July 1930 to the date of the institution of the suit. To this extent the memorandum of objections is allowed. The direction in the lower Court's decree as to interest from that date will stand. The respondents are entitled to costs in this Court both in A.S. Nos. 64 and 65 but to advocate's fee only in A.S. No. 64. The memorandum of objections in A.S. No. 64 is dismissed; there will be no order as to costs in this or in the memorandum of objections in A.S. No. 65.