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Mutha Mudali (Died) and anr. Vs. Kuppanna Goundan - Court Judgment

LegalCrystal Citation
SubjectFamily;Property
CourtChennai High Court
Decided On
Reported in(1956)2MLJ168
AppellantMutha Mudali (Died) and anr.
RespondentKuppanna Goundan
Cases ReferredHanwmayya v. Nayudamma
Excerpt:
- .....the first defendant and his brothers the debt was apportioned among the erstwhile members of the joint family, and that the first defendant being one of them executed the suit mortgage deed for his share of the debt due to the plaintiff for rs. 445-8-0 and interest at the rates stated above. the suit mortgage is evidenced by exhibit a-1 dated 8th june, 1927 and it sets out in detail the circumstances in which the suit mortgage came to be executed in favour of the plaintiff.3. in the suit the first defendant, who is the father of the second defendant, alone filed a written statement contending that the plaintiff had received various sums without issuing receipts or making endorsements, that at a panchayat the plaintiff admitted that no amount was due under the agriculturists relief act,.....
Judgment:

Basheer Ahmed Sayeed, J.

1. This second appeal has been referred to this Bench by Krishnaswami Nayudu, J., for determination of the question whether the fhst defendant could be considered to be an heir, legal representative or assign of the debtor under Explanation IV to Section 8 of Act IV of 1938.

2. The facts of the case briefly are these. The plaintiff brought the suit for recovery of a sum of Rs. 614-7-9 due under a mortgage executed by the first defendant on 8th June, 1927, under which he undertook to pay the amount with interest at 11 per cent, every month and in default at 15 per cent, and also to repay the principal sum within a period of three years. It is common ground that there existed an earlier mortgage for Rs. 1,000 dated nth July, 1917, executed by the first defendant and his brothers in favour of the plaintiff, that on an oral partition between the first defendant and his brothers the debt was apportioned among the erstwhile members of the joint family, and that the first defendant being one of them executed the suit mortgage deed for his share of the debt due to the plaintiff for Rs. 445-8-0 and interest at the rates stated above. The suit mortgage is evidenced by Exhibit A-1 dated 8th June, 1927 and it sets out in detail the circumstances in which the suit mortgage came to be executed in favour of the plaintiff.

3. In the suit the first defendant, who is the father of the second defendant, alone filed a written statement contending that the plaintiff had received various sums without issuing receipts or making endorsements, that at a panchayat the plaintiff admitted that no amount was due under the Agriculturists Relief Act, but later wanted a sum of Rs. 200 for returning the original document, that because the first defendant issued a notice on the 3rd February, 1949, calling upon the plaintiff to return the document with the discharge endorsement, the plaintiff filed the suit as a counter blast. The first defendant also contended that the original principal was only Rs. 250, that towards this amount, a sum of Rs. 187 had been paid prior to 8th June, 1927 and a sum of Rs. 544 after that date and that in view of more than double the amount having been paid the plaintiff was not entitled to recover any amount under the suit mortgage. The learned District Munsif held that apart from the payments endorsed on the suit mortgage deed, no other payments were made to the plaintiff and that therefore the alleged discharge by payment of further sums besides those endorsed on the mortgage was not proved. Taking into consideration the admitted fact that the original principal advanced to the plaintiff before the apportionment between the four members of the joint family was Rs. 1,000 only, and that the first defendant's share was only Rs. 250, out of the said principal sum and also the fact that the other three brothers had paid their share to the plaintiff, and confining himself further to the fact that the suit mortgage contained endorsement of only payments which totalled up to Rs. 544, prior to 1st October, 1937, the learned District Munsif held that in so far as the plaintiff had collected a sum of Rs. 544, which was more than twice the principal sum of Rs. 250 there was nothing due to the plaintiff on the suit mortgage. He therefore dismissed the suit with costs.

4. The plaintiff preferred an appeal A.S. No. 188 of 1950 before the learned District Judge of Coimbatore against the judgment and decree of the learned District Munsif. The only question that was considered by the learned District Judge was whether the decision of the lower Court in scaling down the debt was just and proper. The appellant's contention, however, was that the principal amount due under the mortgage for the purpose of Section 8 of Act IV of 1938 was Rs. 445-8-0 and not Rs. 250 and that the debt to be scaled down could not be traced back to the mortgage deed of 1917, which was for Rs. 1,000, and which subsequently became apportioned among the four members of the joint family on partition. The learned District Judge was of the opinion that the contention of the appellant was well-founded and that it was covered by the decision in Tirupathirayalu v. Verikata Subba Rao : (1949)2MLJ768 . He further opined that the debt of 1917 was split up at the time of execution of Exhibit A-1, the suit mortgage, in 1927 and consequently the continuity of the debt was lost and the principal due under Exhibit A-1 should be considered to be only Rs. 445-8-0 and not Rs. 250. Therefore he found that the plaintiff was entitled to recover a sum of Rs. 891 minus Rs. 544 together with interest at 6 1/4 per cent, from 1st October, 1937 to 29th July, 1947 and at 5 1/2 per cent, thereafter. He, therefore, allowed the appeal giving three months time for payment of the decree amount. The first and second defendants have therefore preferred this appeal. The first defendant died during the pendency of the proceedings, and the second defendant is recognised as his legal representative.

5. Mr. Champakesa Ayyangar appearing on behalf of the appellant contends before us that the learned District Judge ought to have held that more than twice the original principal of the first defendant's share had been paid and that no amount was due under the suit mortgage. His further contention was that under the Amending Act XXIV of 1950, in view of the suit mortgage deed being only in respect of the debt that had been split up Explanation IV to Section 8 would apply and that the principle of the decision in Tirupathirayalu v. Venkatasubba Rao : (1949)2MLJ768 , would not be applicable to the facts of this case.

6. Explanation IV to Section 8 as per the Amending Act XXIV of 1950 reads as follows:

Where a debt has been split up whether before or after the commencement of this Act, among the heirs, legal representatives or assigns of a debtor or of a creditor and fresh documents have been executed in respect of the different portions of such debt, the provisions of this section shall continue to apply in respect of each of the different portions.

There is no question in this case that the original debt was in favour of the plaintiff and that it was in the sum of Rs. 1,000. It is also beyond question that there was an oral partition between the coparceners of the joint family and that this debt of Rs. 1,000, became split up between the members of the coparcenary and each one was called upon to pay a 1/4th share of the debt which at that time stood at Rs. 1,866. It is also beyond controversy that all the four members of the joint family including the appellant before us executed separate documents in favour of the plaintiff respondent for their respective shares of the debt which became split up and apportioned between the said members of the joint family.

7. That there could be an oral partition between the members of Hindu Joint family is well recognised by the several rulings of the Court since a long time, and there is no force in the point raised by the learned Counsel for the respondent that an oral partition of assets and liabilities was not permissible. No authorities need be cited in support of the validity of an oral partition. The next point, raised by the learned Counsel for the respondent in this appeal, is that the debtor, who executed the suit mortgage in favour of the respondent, could not be brought within any of the categories of persons among whom the original debt could be split up as contemplated by Explanation IV to Section 8 of the Agriculturists Relief Act. The original debtor being the entire joint family, the appellant could not be said to be an heir of the original debtor, nor even the legal representatives of the original debtor, nor even the assignee of the original debtor, is the contention of the learned Counsel for the respondent. He, further argues that, while there could be an assignment of an asset of a debtor, there cannot be an assignment of a debt except with the consent of the creditor, who should agree to holding the substituted person for the original debtor to be responsible to him for the debt. We do not think that there is much force in this argument, for though it is true that the present appellant could not be brought within the category of heirs or legal representatives still, in so far as a portion of the original debt has been apportioned and allotted on partition to the present appellant and the present appellant has executed a fresh document in favour of the respondent, it cannot foe disputed that the respondent-creditor had agreed to the assignment of a portion of the debt due to him in favour of one of the members of the joint family to be discharged by him. Otherwise, no significance could be attached to the mortgage deed, Exhibit A-1. In addition to the fact that the respondent took a separate mortgage deed for a portion of the original debt from the appellant and held him liable to pay that portion, there is also the further fact that the respondent received as much as a sum of Rs. 544 from the appellant and had these payments endorsed on the fresh mortgage deed executed by the appellant on the 8th June, 1927, Exhibit A-1 in the suit. In such circumstances, the condition that should be satisfied for the assignment of a debt as pointed Out by the learned Counsel for the respondent, namely, that the creditor should consent to the assignment of the debt in favour of one of the members of the joint family, is fully satisfied and therefore there can be no question that the liability to pay a portion of the original debt has been assigned to the appellant in the present case to be discharged by him.

8. The learned Counsel for the respondent, nevertheless, argued that while the creditor can assign a debt due to him, it is not conceivable as to how one debtor could assign his debt to another and especially by virtue of a partition. The idea of assignment of a debt is foreign to a partition among the Hindu joint family, even as a transfer or conveyance of properties or assets is not involved in a partition among the members of a joint family. He further contends that a partition in a Hindu joint family is merely an adjustment of rights and liabilities between the coparceners, and by no means could a partition be treated as a transfer or a conveyance or an assignment in favour of the parties to the same. Learned Counsel for the respondent relied upon the decision of Govindarajachari, J., in Govinda Nair v. Srinivasa Pattar : (1948)2MLJ463 , which held that there should be a legal assignment of a mortgage debt in a partition in order to enable the assignee-creditor to enforce the mortgage debt; and for that purpose it was further held, in that decision, that a registered partition was necessary in order to effectuate a legal assignment of a mortgage debt by a creditor to another. It is obvious that this decision dealt with the case of a creditor assigning one of his assets for realisation, namely, a debt due from another under a registered mortgage, and therefore it was felt necessary that the assignment of a right to recover a debt, effected through a partition, should be by virtue of a registered instrument in order to enable the assignee to recover the same. But this decision is no authority for the proposition that a liability cannot be apportioned or assigned to another to be discharged by him, if the assignee so undertakes to do, without a legal registered assignment deed. Any undertaking, in our opinion, by one person to discharge the debts of another need not be only by a registered document executed for the purpose. If A owes a debt to B, whether it be under a registered mortgage deed or under an ordinary promissory note or under a bill of exchange, and if C undertakes to discharge this debt on behalf of A, it is nowhere laid down that this undertaking should be only in the form of a registered document and not otherwise. No provision of law and no decision has been brought to our notice to this effect by the learned Counsel for the respondent. In this case however, as already observed, the appellant has undertaken by means of a fresh registered mortgage deed to pay a portion of the old debt due by the joint family in favour of the respondent, and that has been accepted and acted upon by the respondent.

9. The learned Counsel for the respondent then invited our attention to Radhakrishnayya v. Sarasamma : AIR1951Mad213 , in which the applicability of Section 53-A of the Transfer of Property Act to a partition deed was considered by a Bench of this Court. It was held in that case that for purposes of Section 53-A of the Transfer of Property Act, a partition was not a transfer within the meaning of that section, in order to derive benefit under the doctrine of part-performance. We do not think that this decision has any application to the facts of the present case.

10. The learned Counsel for the respondent next invited our attention to a decision in Karuppanna Goundan v. Marutha Pillai : AIR1941Mad663 , where it has been held that a son on partition, being allotted the joint family debt, is a different debtor and not the same debtor. This decision obviously does not have application to the Amending Act XXIV of 1950, because it appears to us that it was only with a view to meet the situations where the family debt becomes split up and responsibility is undertaken by the divided members of the joint family without any detriment to the creditor, that the amendment itself was enacted. Even on the theory that when a member of the family, on partition, takes over the entire or a part of the family debt to be discharged by him he becomes a different debtor, if he is an agriculturist he should still derive the benefit under the Act, appears to be the intention of the legislature in enacting Explanation IV to Section 8 of Act IV of 1938. That is why the existence of an old debt, its being split up and its being allotted among heirs, representatives or assigns have all been mentioned in the Explanation IV added to Section 8. Construing the language of 'heirs legal representatives and assigns' found in the explanation, it was argued by the learned Counsel for the respondent that the splitting up and the allotment or apportionment should itself be among the heirs or among the legal representatives or among the assigns and that it is not contemplated in the explanation that the splitting up should be between the members of the joint family and its assigns or allotees. The attempt to construe the explanation as meaning that the splitting up of the debt should be among the assigns themselves, instead of the original debtor and his assigns, appears to us to be reading too much into the simple language of the explanation. To us, the language of the explanation warrants only the construction that if an existing debt becomes split up and is allotted either to the heirs or to the legal representatives or to those who do not come within these two categories, but may fall within the last category, namely assigns, such heirs, legal representatives or assigns should get the benefit of the section of the Act concerned and nothing more. The suggested construction, different from the one which we hold to be the proper one, must be considered to be too wide of the mark. It must also be noted that in the language of the explanation, the categories of persons among whom the debt may be split up to whom the benefit of the section would still be available, could either belong to the category of debtors or creditors. The legislature has, therefore, purposely inserted both the words 'debtor' and the 'creditor' in the explanation. It contemplates therefore the assigns of a creditor as well as those of a debtor. The assigns of a debtor could be only those who undertake to pay the liability, provided of course the creditor consents to the substitution. In order to ensure that there is no difficulty in the application of the scope of this section, the legislature has also added the further requirement, namely, that fresh documents should be executed in respect of the different portions of the debt split up and allotted to the persons falling within the various categories mentioned in the section. The explanation therefore clearly contemplates the splitting up of not merely a debt as a liability but also of a debt as an asset and that appears to be the simple reason why both the debtor and creditor are specifically mentioned in. the explanation.

11. A further decision in Sabapathi Mudaliar v. Rajarathna Mudaliar (1941) 1 M.L.J. 02, has been cited before us by the learned Counsel for the respondent, where it has been held that when a son executes a mortgage for the debt of his father, mortgaging at the same time his own properties, it cannot be considered to be a renewal of the old debt by the same debtor. In view of what we have stated above, we do not think that this decision, either, has application to the circumstances of the present case. Previous to the enactment of Explanation IV, it would have held good but the explanation has met the situation dealt with in that case. Some point has also been sought to be made out by the learned Counsel for the respondent from the fact that while the term 'creditor' is defined in the Act, there is no definition of the word 'debtor' but the definition found is only of the term 'debt'. In our opinion, the legislature did not apparently think of any necessity to define the term 'debtor', but thought it sufficient only to define what a debt means for the purpose of the Act. It assumed that any one who has to pay a debt would be a debtor and there was no need for the definition of the term 'debtor' as such, whereas the term 'creditor' has been defined to include his heirs, legal representatives and assigns because a Creditor obviously has rights, which could be enforced and which would be inherited, transferred or conveyed as assets. Mr. Jagadisa Ayyar, the learned Counsel for the respondent has, however invited our attention to a passage in Sankara Pattar v. Ramanatha Ayyar (1954) 2 M.L.J. 155, to which one of us was a party, which is as follows:

The second line of attack is centered round the manner of execution and that is that even if there is a decree in favour of the head of the joint family still at the time execution was taken the person who applies for execution cannot initiate the steps because he has neither a representative capacity nor any right in himself to execute the decree. Reliance is very strongly placed on a decision reported in Ramanathan Chettiar v. Raghavendra Row 16 Ind.Cas. 807, where after the passing of a decree in favour of the kartha of a joint family, there was a division of the joint family properties. It was alleged that at an oral partition that decree was allotted to one of the members who applied for execution on the strength of the oral allotment in his favour. Sundara Ayyar and Sadasiva Ayyar, JJ., held that as there was no assignment of decree in writing the person to whom it was orally allotted, could not execute it in view of Order 21, Rule 16, Civil Procedure Code. They held that under Order 21, Rule 16, Civil Procedure Code, an assignee of a decree can apply to execute it only when the assignment is in writing. An oral transferee is not entitled to execute it. Therefore where a decree obtained by one of the members of a Hindu Joint family is allotted at a family partition to another coparcener, the person to whom it is allotted cannot be treated as an assignee of the decree by operation of any law and he cannot by reason of such allocation alone execute the decree unless he was so empowered by an instrument in writing. On the strength of this decision the learned Counsel for the appellant contends that since in the partition deed there was no allotment of this decree specifically to the applicant for execution he should be deemed to be applying without an assignment in his favour so that the provisions of Order 21, Rule 16, Civil Procedure Code, cannot be invoked in favour of such an applicant.

This passage is not of any great assistance to the respondent, for there, the Bench was considering a case where a decree was obtained by one of the members of a Hindu joint family and the decree, as an asset, was allotted at a family partition, to another coparcener and it was observed that the person to whom it was allotted, cannot be treated as an assignee of the decree by operation of law and that by reason of such allocation alone execute the decree, unless he was empowered by an instrument in writing. Order 21, Rule 16 of the Civil Procedure Code could not allow the execution of a decree by reason of a mere allotment of the same on partition to one of the coparceners; and an earlier decision of a Bench of this Court in Ramanathan Chettiar v. Raghavendra Row 16 Ind.Cas. 807, was relied upon to say that such an assignment on a mere oral partition cannot be availed of without an assignment of the decree in writing. The present case is not governed by the ruling cited, in view of the different circumstances obtaining in the case.

12. The learned Counsel for the appellant has invited our attention to a decision in Nagachari v. Subbamma (1954) 2 M.L.J.244, where Umamaheswaram, J., held that where in a case the original promissory note was executed in favour of the manager of a joint family consisting of himself and his two sons and there was a partition suit between them and the promissory note was allotted to the share of one of the sons and a fresh note executed in favour of that son by the promisor for the amount outstanding, there was a legal assignment of the original promissory note in favour of the son of the original creditor, by reason of the partition decree, that the son in whose favour the promissory note was executed should be regarded as an assignee of the original promissee and that the debt should be traced to the original promissory note in favour of the manager and therefore was liable to be scaled down on application by the debtor. Umamaheswaram, J., relied upon the decision of Govindarajachari, J., in Govinda Nair v. Srinivasa Pattar : (1948)2MLJ463 , dissenting from the decision in Hanwmayya v. Nayudamma : (1951)2MLJ400 . Though in the case cited above there was a partition decree and by virtue of the partition decree the promissory note was allotted to one of the sons of the manager, who was the original promissee and a decree was obtained thereon, the assignment was held to be a legal assignment for purposes of the Agriculturists Relief Act, in the present case there is only an oral partition but a fresh mortgage deed has been executed by the debtor consequent upon the splitting up of the debt and the allotment of a portion of the debt in his favour and the creditor seeks to enforce his claim for the debt under the said mortgage deed, still the principle of the above decision would apply, namely that there is a legal assignment of a portion of the debt to one of the erstwhile coparceners to be discharged by him as contemplated in the Explanation IV to Section 8 of the Act. It cannot therefore be disputed that in the circumstances of the present case the legal liability to discharge a portion of the original debt vests in the person to whom the debt has been assigned on partition and which assignment has been agreed to by the creditor as evidenced by the execution of a fresh mortgage deed in his favour.

13. Therefore, considered from any point of view, in our opinion, all the requirements specified in Explanation IV to Section 8 of Act IV of 1938 are satisfied in the present case and the debt is one which is liable to be scaled down under the said explanation. If the explanation applies to the present case, then it is clear that the view taken by the learned District Munsif is the correct one and the debt in question should be deemed to have been completely paid up. The result will be that the decree of the learned District Judge should be set aside and the decree of the learned District Munsif should be confirmed. We order accordingly. But in the circumstances of the case we direct that each party should bear his costs.


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