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C.V. Ramaswami Naidu and ors. Vs. C.S. Shyamala Devi and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai High Court
Decided On
Reported in(1978)1MLJ505
AppellantC.V. Ramaswami Naidu and ors.
RespondentC.S. Shyamala Devi and ors.
Cases ReferredIn Bull v. Bull
Excerpt:
- paul, j.1. o.s.a. no. 81 of 1975 is an appeal under clause 15 of the letters patent against the judgment and decree of the learned single judge on the original side of this court in c.s. no. 16 of 1972. a.s. no. 615 of 1973 and a.s. no.216 of 1971 are appeals filed against the judgment and decree of the learned iii assistant judge of the city civil court in o.s. nos. 2771 and 2960 of 1967. these two appeals have been transferred to the file of this court to be heard along with o.s.a. no. 81 of 1975.2. all the three appeals are by c.v. ramaswamy naidu who is the first defendant in o.s. no. 16 of 1972 and the plaintiff in o.s. no. 2771 of 1967 and 2960 of 1967. c.s. no. 16 of 1972 was filed by c.v. srinivasan, the brother of the appellant in all these appeals for partition and separate.....
Judgment:

Paul, J.

1. O.S.A. No. 81 of 1975 is an appeal under Clause 15 of the Letters Patent against the judgment and decree of the learned single Judge on the Original Side of this Court in C.S. No. 16 of 1972. A.S. No. 615 of 1973 and A.S. No.216 of 1971 are appeals filed against the judgment and decree of the learned III Assistant Judge of the City Civil Court in O.S. Nos. 2771 and 2960 of 1967. These two appeals have been transferred to the file of this Court to be heard along with O.S.A. No. 81 of 1975.

2. All the three appeals are by C.V. Ramaswamy Naidu who is the first defendant in O.S. No. 16 of 1972 and the plaintiff in O.S. No. 2771 of 1967 and 2960 of 1967. C.S. No. 16 of 1972 was filed by C.V. Srinivasan, the brother of the appellant in all these appeals for partition and separate possession of his half share in the immovable properties described in the plaint A Schedule and the movables set out in the plaint B Schedule and for a decree directing the first defendant to pay to the plaintiff a half share in the investments made by the first defendant as Set out in the C Schedule and for a decree directing the defendants to render a true and correct account of all the rental income derived by the defendants from the immovable properties and the investments made by the first defendant.

3. O.S. No. 2960 of 1967 was filed by the first defendant in C.S. No. 16 of 1972 for a declaration that he is the real owner of the house and ground No. 7 Jagannathapuram I Street, II Lane Chetpet, Madras, described in the plaint schedule and for a decree directing the defendant to deliver vacant possession of the property. O.S. No. 2771 of 1967 was also filed by the plaintiff in O.S. No. 2960 of 1967 and 1st defendant in C.S. No. 16 of 1972 for a declaration that he is the real owner of the amount due under the suit promissory note and for recovery of a sum of Rs. 1,045 from the second defendant in that suit.

4. During the pendency of the suit C.S. No. 16 of 1972 the first plaintiff died and his legal representatives have been brought on record as plaintiffs 2 to 8 as per the order of the Court dated 12th December, 1973.

5. The plaintiff in C.S. No. 16 of 1972 and the plaintiff in O.S. Nos. 2960 and 2771 of 1967 are brothers being the sons of one C.R. Varadarajulu Naidu. Defendants 2 to 4 in C.S. No. 16 of 1972 are the wife and daughters of the first defendant. According to the plaintiff in C.S. No. 16 of 1972, he and the first defendant were members of an undivided Hindu family and they both started together the business of running a tea stall at No. 1, Jagannathapuram First Street, Chetpet, Madras in or about the year 1947 and though the licence for that tea stall was obtained in the name of the first defendant, yet it was a joint business conducted by the plaintiff and the first defendant with the funds provided by both of them, which funds consisted of the savings which both the plaintiff and the first defendant had made while the plaintiff was employed as a watchman in the Corporation of Madras and the 1st defendant is variously employed and subsequently with the profits earned by the aforesaid tea stall they both started a military hotel under the name and style of Om Sakthi at No. 14, Jagannathapuram II Street, Chetpet, obtaining the licence for the same in the name of the plaintiff and in the year 1952 however the tea stall at No.l, Jagannathapuram First Street, Chetpet, was closed down, but the military hotel was continued and it flourished and earned considerable profits and with those profits a property bearing door No. 4, Jagannathapuram First Street, Chetpet, Madras, was purchased in 1956 in the name of first defendant and in the year 1959 the property bearing door No. 7, Jagannathapuram I Street, Second Lane, Chetput, Madras was purchased out of the joint funds in the name of the plaintiff and in the year 1966 another building bearing door No. 14, Jagannathapuram II Street was purchased in the name of Ethirajulu Naidu the maternal uncle of the plaintiff and of the first defendant with the joint income earned by the plaintiff and. the first defendant and further the plaintiff and the first defendant are also running a taxi MSX 5895 from the year 1964 which taxi had been purchased in the name of the second defendant, the wife of the first defendant with the joint funds, but in the year 1967, disputes arose between the plaintiff and the first defendant and the first defendant sold away the taxi in October, 1967 and. took away all the account books and sent away the plaintiff and the plaintiff later on came to know that the first defendant had been secretly investing the joint monies by advancing the same to third parties on mortgages and on promissory notes in the names of defendants 2 to 4 who are his wife and daughters with a view to deprive the plaintiff of his half share in those amounts. The plaintiff has listed out in the plaint the amounts so advanced and claims that the first defendant is liable to render accounts for the monies so advanced and also for the rental income which he had been collecting from the immovable properties.

6. The first defendant in C.S. No. 16 of 1972 resisted the suit contending that he and the plaintiff were never members of an undivided Hindu family and that all the properties claimed by the plaintiff were his, the first defendant's separate and self-acquired properties, acquired by him without the aid of any ancestral nucleus and that therefore the plaintiff is not entitled to any share in those properties or in the incomes from the investments or from those immovable properties. According to him he started eking out his livelihood at Madras and other places from the year 1936 and was employed in a number of tea shops and then from 1939 he was employed under one Namberumal Chetty, a leading contractor and later on he was working as a male nursing orderly in the General Hospital, Madras and in the year 1939 the feelings between him and his father became estranged and his father put in a publication in the Dinamani dated 6th July, 1943 that he, the first defendant had nothing to do with the properties which the father was owning (which were however very negligible) and while he the 1st defendant was working as a nursing orderly in the General Hospital he was sent to Rangoon in 1941 at the time of the Second World War and he returned to Madras in 1942 and with the savings which he had accumulated by then he started a tea stall in the year 1947 near his residence at No. 1, Jagannathapuram First Street, II Lane, Chetpet, taking out the licence for the same in his own name and since his wife long prior to 1947 had also been preparing and selling edibles and had accumulated some savings of her own and further since he, the first defendant was a race-goer from the year 1939 and had the good fortune to make substantial gains in races periodically he started investing monies by lending monies. He emphatically denied that the plaintiff contributed any funds for the starting of that tea stall. He further asserted that the plaintiff had nothing to do with the tea stall, but since the plaintiff had no means for his upkeep and maintenance he approached him, the first defendant for help in eking out a livelihood and hence the plaintiff was asked to look after the sales in the first defendant's tea stall and in return he was provided with food and clothing and subsequently the first defendant started in 1950 a second tea stall out of his own funds, at No. 14, Jagannathapuram II Street, Chetpet, Madras and since he felt that he could not easily obtain and hold two licences in his name from the Corporation for the conduct of two similar business he had to obtain the licence for the second hotel in the name of the plaintiff and after the first tea stall was closed down in 1952, the plaintiff was helping him the first defendant in running the second tea stall which became an eating house in 1956 and was popularly known as 'Ramaswamy Hotel' and he, the first defendant was in exclusive management of the business and was maintaining the accounts and receiving the profits as of right and on his own and maintaining the family of the plaintiff and giving them food and other necessaries in consideration of the physical help rendered by the plaintiff. But in the year 1966 that business was also closed down and he, the first defendant started a third business at No. 7-A, Rajambal Street, Chetpet, Madras, under the name and style of Hotel Panchamirtham, obtaining the licence in his own name and with his own funds. But that business had to be closed down in 1968 on account of several litigations between him and the landlord of the premises in which the hotel was being run. The first defendant further contended that he acquired the property bearing door No 4, Jagannathapuram First Street, Chetpet in 1956 for Rs. 19,000 out of which a sum of Rs. 14,000 was paid by him out of his own funds to the vendor at the time of the purchase and for the balance a deed of mortgage was executed and that mortgage was later on discharged by him, the first defendant and he has been in exclusive enjoyment of that property paying the public rates and taxes, having custody of the document, and realising the rent and the plaintiff has absolutely no right title or interest in that property and likewise the property bearing door No. 7, Jagannathapuram First Street, 2nd Lane, Chetpet, was also purchased by him out of his own funds but benami in the name of the plaintiff and actually he, the first defendant had. advanced out of his funds a sum of Rs. 3,500 to one Rengiah who originally owned the property on the security of a mortgage dated 3lst December, 1951, executed by him and later from 1951 onwards he the first defendant had become a tenant under Rengiah, and on the death of Rengiah he acquired the property by purchase in 1959 from the heirs of Rengiah for a sum of Rs. 4,500, adjusting a cash of Rs. 1000 and the amount due under the mortgage deed. He asserted that the aforesaid amounts were not joint funds but were exclusive funds belonging to him and subsequently after his purchase he had demolished the old structure and had reconstructed the material portions of the building spending Rs. 25,000 to Rs. 28,000 from and out of his own funds and occupied the entire downstairs for his residence and leased out the upstairs and has been collecting rent for the same and paying the public rates and taxes and having the custody of the documents and the plaintiff was only allowed to reside in the premises along with him, the first defendant, and the plaintiff was permitted to use two rooms in the premises as a temporary measure; but on account of ill-feelings that arose in 1967 the plaintiff forcibly opened the door of the third room in defiance of the order of the City Civil Court and has been occupying the three rooms in the premises.

7. In regard to the premises No. 14, Jagannathapurarm, Second Street, Chetpet, Madras, also the first defendant's claim was that he purchased the property with his own funds under a registered sale deed dated 20th July, 1956 from one V. Venkatasamy and Ors. for a price of Rs. 7,500 but that the sale deed was taken in the name of his father-in-law Ethirajulu Naidu who was also the maternal uncle of the plain tiff and it is he, the first defendant, who has been realising the rent from that property and paying the public rates and taxes and having the custody of the documents of title. He asserted that the income from the hotel business was hardly sufficient to maintain his family since the monthly income from that business was never more than Rs. 300 and actually it was from out of the gains made by him in the racecourse and the income realised by him out of his investments that he made the afore- said purchases. With regard to the taxi MSX. 5895 the first defendant contended that he purchased the same from one Jethswany for Rs. 11,300 in the name of the second defendant out of his own funds and subsequently in September, 1967 it was sold away for Rs. 8,000. With regard to the several items of mortgages mentioned in paragraph 7 of the plaint, the first defendant's case is that all of them were monies advanced from out of his own funds.

8. The second defendant who is the wife of the first defendant and defendants 3 and 4 sailed with the first defendant.

9. The plaintiffs 2 to 8 filed a reply statement contending that the first plaintiff and the first defendant were living together from the year 1946 and pooling their income and the first tea stall was started in the year 1947 only with that joint income and the subsequent acquisitions were all made with the profits earned by that business.

10. It might be mentioned at this juncture that the suit C.S. No 2960 of 1967 was filed by the first defendant herein for a declaration that the property bearing door No. 7, Jagannathapuram I street, II Lane, Chetpet, Madras, belonged to the first defendant, though standing in the name of the plaintiff herein and that suit having been dismissed. A.S.No. 216 of 1971 has been filed against that decree by the first defendant and the suit O.S. No 2771 of 1967 was filed by the first defendant for a declaration that the sum of Rs. 1,000 advanced to. one Damodaran in the name of the plaintiff belongs to him, the first defendant and for recovery of the same and that suit having been dismissed the first defendant has filed A.S. No. 116 of 1971. These two appeals however stand abated inasmuch as the legal representatives of the deceased C.V. Srinivasan, the defendant in those suits and the respondent in these appeals have not been brought on record.

11. Mr. N.C. Raghavachari contends that effect of the dismissal of the above two appeals on the above said ground will be to make the findings of the learned trial Judge in the two suits which gave rise to those two appeals final and would consequently raise the bar of res judicata in the appeal O.S.A. No. 81/75 in, regard to the matters on which such findings have been given But it is not necessary for us to go into that question for the disposal of this appeal O.S.A. No. 81 of 1975.

12. The learned Judge on the original side has found most of the issues in favour of the plaintiff in the suit C.S. No.16 of 1972.

13. Under appropriate issues, the learned Judge, Mohan, J., found on the evidence adduced by both sides that the two brothers, the first plaintiff and the first defendant broke away from the original joint Hindu family because of the strained relationship with the father and put forth their joint efforts and the first defendant being the elder brother was managing the entire affairs and as a result of their joint efforts certain income accrued which income was mixed up with the personal income from the races, and various properties were acquired but in the absence of the accounts and better evidence it was not possible to predicate as to what exactly was the contribution by the respective parties towards these acquisitions and assuming that they cannot be members of an undivided Hindu family certainly they will be co-sharers and tenants-in-common and in the absence of an agreement each would be entitled to a half in the properties. As regards the A Schedule properties which consisted of three items of immovable properties he found that the purchase of item 1 was at a time when the second shop, which was a military hotel, was yielding profits and that is how it was possible for the first defendant to make that purchase and the second item also should be held to have been acquired by the joint efforts for in respect of the consideration for that item the evidence showed that there was a mixingup of the income. With regard to the third item also he held that it was an acquisition by their joint efforts and the plea that it was purchased benami in the name of the first plaintiff was rejected by him. With regard to the B Schedule properties, he found that inasmuch as there was no plea that they were acquired out of the joint efforts, he had to necessarily hold that the plaintiffs had not established that they were entitled to a share. He held that the claim to the C Schedule properties was barred by limitation. He therefore passed a preliminary decree in favour of the plaintiffs for partition of their half share in the items contained in the A Schedule. He further held that the first defendant was liable to account to the plaintiffs with regard to the rental income from the properties in the A Schedule. Challenging these findings, the first defendant has filed this appeal, O.S.A. No. 81 of 1975.

14. The contentions strenuously advanced on behalf of the defendants by their learned Counsel Mr. K.N. Balasubramaniam are that there is satisfactory evidence to show that the acquisitions of the A Schedule properties were all made by the first defendant out of his own funds, namely, the gains which be had made in the race course and the income which he realised by his investments and that even assuming that the hotel business was being carried, on by the joint efforts of the plaintiff and the first defendant, and with their joint funds even then the evidence establishes that the income from the business which were negligible and were sufficient only to maintain the family of the first defendant would not have constituted any part of the funds with which the acquisitions of the A Schedule properties were made.

15. As has been pointed out by the learned Judge on the original side, it is unbelievable that from out of the gains made by the 1st defendant in the race course, the acquisitions were made. The learned Judge has pointed out that 'even though in Exhibit P-25 it has been stated that all the three hotel businesses ended in a loss, it is admitted that these businesses were very profitable and if these businesses had earned profits it was the duty of the first defendant to have shown what exactly are the profits which resulted in those acquisitions and taking on overall picture of the matter and having regard to the income as seen from the various assessment orders from these businesses it cannot be held that those incomes provided the necessary funds for these acquisitions and the outstandings. The learned Judge has observed that to his mind it appeared that neither party was speaking the truth and each, was putting forth an exaggerated version and as such it is imperative for the Court to analyse the evidence carefully and find out what exactly is the correct state of affairs. We are in entire agreement with those observations of the learned Judge.

16. First of all, as has been pertinently pointed out by the learned Judge the case of the first defendant has not been consistent at all. In Exhibit D-7 he does not say that the business ever ended in a loss. On the contrary in Exhibit D-55 he has stated that the business was very profitable. In this evidence he confessed that it was not possible for him to tell the Court as to what was the total profit earned from those businesses during the period of 16 years from 1950 to 1966. While at one place in his evidence he would say that the income from the shops was not sufficient to maintain the family, he had admitted before the City Civil Court in the other two suits that profits were earned by the second shop and that the profits were kept in a box. The first defendant did not produce any account books in regard to the first tea stall which was opened in 1947 with the licence in his name but asserted that those account books were lost and are not available. This puerilo explanation can never be accepted. As regards the second shop, some account books were produced and the claim by the first defendant was that the others have been lost. This explanation also is equally puerile. From the account-books produced, it is not possible to ascertain the actual income earned by the second shop. In the pleadings, it must be noted, the first defendant has not stated that the account books had been lost. In his written statement he has categorically admitted that he was in custody of the accounts. Therefore, from the non-production of these account books an adverse inference could be raised against the first defendant when the explanation that the account books are lost is not accepted.

17. The assessment orders however show that the second shop which was started in the year 1950 in the name of the plaintiff was earning profits which were progressively increasing as shown by the assessment orders Exhibits D-22 to D-26 from the year 1958 onwards at least. In 1958, the net turnover of that shop as determined by the assessing authority was Rs. 10,562 and in the next year also the same turnover was determined. In the year 1960 the turnover was assessed at Rs. 14085 and in 1961 also the same turnover was determined. In 1963 the turnover was determined at Rs. 15,967.35. In 1964, it was determined at Rs. 18,194.13 and in 1965 it was determined at Rs. 33,939.05 and in 1966 it was determined at Rs. 40,560.68 but it cannot be gainsaid that the second tea shop which eventually became an eating home was a profitable concern. Now, the licence for this shop, it might be noted stood in the name of the first plaintiff and the assessee in the assessment orders has been noted as the first plaintiff. It might be noted that the first item of the A schedule properties was purchased in the year 1956 for Rs. 19,000. The third item; of the plaint A Schedule was purchased on 22nd July, 1959 for Rs. 4500 in the name of the plaintiff. The second item was purchased in the year 1966 in the name of the maternal uncle of the first plaintiff and the first defendant Ethirajulu Naidu, who as we have said, is the father-in-law of the first defendant. The aforesaid acquisitions could have therefore been made partly with the aid of the income from that shop. The first tea stall which was started in the year 1947 at No.l, Jagannathapuram I Street, Chetpet, was no doubt started in the first-defendant's name. The first defendant in his evidence as D.W. 1 claimed that he invested Rs. 300 to Rs. 400 in that business and that the daily sale's in the tea stall was about Rs. 5. This tea stop it might be noted was being run from 1947 to 1953. The 1st plaintiff in his evidence asserted that from 1946 he had been living with the 1st defendant. Even according to D.W. 1's own admission the first plaintiff was living with him from 1950 onwards until 1964. It is admitted by the first defendant that his first cousin Parthasarathy Naidu was having a tea stall in 1946 and the suggestion is that that tea shop was being run at No. 1, Jagannathapuram I Street and that that tea stall was given by Parthasarathy Naidu. Even though according to the first defendant, the daily sales from the first tea shop was only Rs. 5 yet in his testimony he would claim that the income earned in the first business was invested in the second business. He admits that the first plaintiff was helping him in the second tea shop which incidentally was being run under a licence which stands in the name of the first plaintiff. The reason given by the first defendant for having obtained the liecence in the name of the first plaintiff for that second tea shop is hardly acceptable. He says that since the licence for the first tea shop was in his name, he thought that there would be difficulty in his obtaining a licence for the second shop also in his own name and hence took the liccence for it in the name of the first plaintiff. He however resiled from that answer when cross-examined. When he was asked what was the source for the funds which he invested in the second shop, he stated that his wife was earning and he was also getting money from the race and he was also having the monies which he got as profits from the first shop and further the monies which are earned by his father-in-law were with him and all those he invested in the second business. These assertions of his are definitely an afterthought, for his earlier contentions were that the income from the first shop was hardly sufficient to maintain his family and that it was entirely with the money earned from the races that he started the second shop.

18. He did not state at any earlier occasion that he had with him the monies which his wife earned and the monies which his father-in.-law gave. Subsequently he gave yet another reason for having taken the licence in the name of the first plaintiff and that was that he was extremely angry with his father and took out the licence in the name of the first plaintiff so that his father could be put to shame. In Exhibit D-7 he gave yet another reason by stating that because Srinivasan was not able to maintain himself, he took pity on him and started the business in his name but with his (first defendant's) funds. In his deposition before the City Civil Court he stated that because Srinivasan came to him and he was his brother, he took the licence in his name. All these clearly indicate that the first defendant was not speaking the truth.

19. Then again it is quite unlikely that the first defendant had been consistently making gains in the race course and that too so much gains as would enable him to make the various purchases of properties. He has contended that he never had any business transactions with book makers. As a reason for his avoidance of book makers he stated that if one goes to book makers he would only incur loss at the racecourse. But in Exhibit P-25 he had stated that he earned Rs. 18,000 through book makers. In his deposition during the trial of the suit he admitted that that was correct. Then he stated that he did not have contact with them closely.

20. When confronted with his previous answer, namely, that if he had laid bets through bookies he would have lost heavily, and hence he never did it, he stated: 'If we have connection with them on account to bet, then bookies will tempt me to bet on this horse or that horse like that, and so I have to incur loss and so on account of that I did not have connection with them on account'. When asked for the name of the bookmaker with whom he had contacts, he said there were about 25 persons, though he cannot mention the name of anyone of them for they would be changing from year to year. All these answers show that his contention that he was making considerable gains at the race course is unbelievable.

21. the admitted facts are that the plaintiff had been living with the first defendant even from the year 1047 or the year 1950and further the second hotel business which was started was in the plaintiff's name and the first defendant admitted that the plaintiff was helping him in that shop. Further it was the Plaintiff who was submitting the sale tax returns for that shop and the rationcard was also obtained in the name of the plaintiff in 1965 as admitted by the first defendant and the accounts for the shop were all written in the plaintiff's name. The first defendant further admitted in his evidence that he paid the first premium for the insurance policy which was taken out in the name of the plaintiff from out of the plaintiff's 'personal accounts'. When asked whether it was from the business funds, he answered 'may be, I do not know how he paid.' The fact that the licence for the second business was taken out in the name of the first plaintiff as well as the fact that item 3 was purchased in the name of the first plaintiff and no motive has been satisfactorily furnished by the first defendant for having taken out the 1icence for that shop in the name of the first plaintiff and no motive has been even suggested for the purchase of item 3 benami in the name of the first plaintiff are all indicative of the acquisitions having been made with the income accrued by the joint efforts of the two brothers.

22.Item 1 was purchased under Exhibit D-31, dated 6th April, 1956 for a sum of Rs. 19,000 and out of that consideration Rs. 14,000 was paid in cash and a sum of Rs. 5,000 was adjusted by the execution of a mortgage by the first defendant to the vender; and subsequently, the mortgage amounts were paid off during the year 1996. Though the first defendant contents that these payments were made from out of the income from the races, we are unable to accept this contention which was rejected by the learned trial Judge also. This purchase was at a time when the second shop which was a military hotel was yielding profits and the mortgage amounts had been paid off during the time when the second shop was yielding profits.

23. Item 2 was purchased under Exhibit D-62 in the name of Ethirajulu Naidu, the father-in-law of the first defendant and maternal uncle of the first plaintiff and the first defendant, on 20th July, 1966 for a sum of Rs. 7,500. Out of that amount Rs. 5,600 was adjusted towards a mortgage and Rs. 1,900 was paid in cash. The sum of Rs, 5,600 adjusted towards the mortgage included Exhibit D-54 dated 30th November, 1953 which mortgage was standing in the name of the first plaintiff. This would also indicate the mixing up of income.

24. Item 3 was purchased under Exhibit P-46, dated 22nd July, 1969 in the name of the first plaintiff and though it was contended by the first defendant that it was a benami purchase, no motive has been suggested for such a benami purchase. Therefore, undoubtedly, the in come accrued by the joint efforts by the brothers had been mixed up with the personal income of the first defendant from the races and these properties had been acquired.

25. The next question is what is the resultant position? We are in entire agreement with the learned trial Judge when he says that the true legal position therefore is that these two brothers will be co-owners and tenants in common end each will be entitled to a half share.

26. Co-ownership is a relationship which springs and slopes from consensus and contract. Legislation has only imprinted on the concept of co-ownership certain rights which have a supervening effect which are declaratory of the rights inter se as between co-owners. The legal relationship is always knitted in a framework of jointness and no one therein can predicate with certainty as to what portion of the property held in common is his; and an element of inseparability is inhered in the doctrine of co-ownership. What can be predicated by reason of Section 45 of the Transfer of Property Act and by invoking the principle of quasi trust in the Indian Trusts Act is the quantum of rights of such co-owners in the entirety of the property. Such quantification of rights of each of the co-owners in a given property depends on the facts and circumstances of each case. It is for the purpose of providing a just rule for weighing and appreciating the value or interest of a co-owner in joint property that the rule of equity is evolved in Section 45 of the Transfer of Property Act, which runs as follows:

Where immovable property is transferred for consideration to two or more parsons, and such consideration is paid out of a fund belonging to them in common, they are, in the absence of a contract to the contrary, respectively entitled to interests in such property identical, as nearly as may be with the interests to which they were respectively entitled in the fund; and, where such consideration is paid out of separate funds belonging to them respectively, they are, in the absence of a contract to the contrary, respectively entitled to interest in such property in proportion to the shares of the consideration which they respectively advanced. In the absence of evidence as to the interests in the fund to which they were respectively entitled, or as to the shares which they respectively advanced, such persons shall be presumed to be equally interested in the property.

Therefore, if the source of the purchase price or the consideration for the investment in a joint enterprise emanates from a common fund, then the shares of each of the co-owners or co-entrepreneurs would be the same as their interest in that common fund. This equitable adjustment of rights is subject to a contract to the contrary. If, therefore, there is evidence that two or more persons purchased the property or an interest in the property, then the rule in Section 45 of the Transfer of Property Act would be automatically attracted, unless the parties have contributed otherwise in the matter of their quantum of interest in the joint property. The fact that the property was purchased in the name of one of the co-owners, would not make a serious dent on the above rule of good conscience provided however it is established by acceptable evidence that such purchase in the name of co-owner was by accident or by consent and that the consideration for such purchase emanates from a common fund. It is this rule of justice-equity and good conscience which is reiterated in the Indian Trusts Act by the provisions which deal with quasi trusts as they are styled in legal parlance. In Section 94 of the Indian Trusts Act, which is residuary in character, a provision is made to cover cases where the legal and equitable interest are not united in the same person. Section 94 of the Indian Trusts Act provides that the person having possession of property in which he has not the whole beneficial interest trust hold the property for the benefit of the other persons having such interest to the extent necessary to satisfy their just demands. Section 95 of the Indian Trusts Act makes the position more clear and highlights the obligations, duties, liabilities and disabilities of such a person holding the property in his name but not having both the legal and the equitable interests united in him. In a proved case of such a holding of property by an individual in his own name, but for the benefit of others, who are also interested in it, the individual has accepted his position as a constructive trustee of such property and he has to hold the same for and on behalf of the person for whom and for whose benefit he holds it. Excepting for certain rights which he has to deal with the said property for the conjoint benefit of himself and other co-owners, he cannot project in himself a title which is inconsistent with or derogatory to the other title of the co-owner. Section 90 of the Trusts Act says 'where a tenant for life, co-owner, mortgagee or other qualified owner of any property, by availing thereof of his position as such, gains an advantage in derogation of the rights of the other persons interested in the property or where any such owner on representing all persons interested in such property, gains any advantage he must hold for the benefit of all persons so interested the advantage so gained, but subject to '...' It therefore follows that the concept of co-ownership has certain peculiar rights and liabilities attached to it and that is why it is accepted law that a co-owner cannot even by the mere possessory title of the property in him claim the same by adverse possession. One can be said to hold a property adversely to the other, provided it is open, continuous and public possession which is to the prejudice of the other co-owner. Since such continuous and open and adverse possession by one co-owner against the other is not possible, having regard to the indivisible and well-knit rights of all co-owners of the totality of the property, one co-owner cannot set up an adverse title to the prejudice of the other co-owner, though he may be for all physical purposes incorporeal possession of the concerned property.

27. Such being the accepted notions, which are inextricably connected and annexed to the doctrine of co-ownership, we are unable to agree that, in the instant case, one brother who purchased the property in his name but with a common fund earned by the exertions of himself and his brother, could set up an exclusive title in himself and ward off the just and equitable claims of the other brother in the suit properties.

28. Though strictly speaking, the plaintiff and the first defendant cannot be deemed to have formed a joint Hindu family still where a person acquires certain property with the help of funds which belonged to him jointly with the other and are available in his hands, the co-owners are entitled in equity to the proportionate interest in the newly acquired properties and a suit for partition cannot be resisted merely on the ground that the co-owners do not strictly form a joint Hindu family. (vide Arokia Manikaran and another v. Sowarivaru Manikaran and Ors. (1952) 8 D.L.R. Tr. Co. 203.

29. In Cooke v. Head (1972) 2 All E.R. 38, an unmarried couple acquired a house by their joint efforts for their joint benefit, though the land was acquired by the man in his name for the purpose of building a bungalow for himself and his mistress to set up home together, with the mistress not contributing to the purchase price of the land, but helping the man in the physical work of building the bungalow and contributing to the mortgage installments and other expenses; and the property was subsequently sold after the couple had separated. It was held that the man held the property on trust for himself and the woman beneficially. It was held that the constructive or resulting trust imposed by the Courts on the legal owner in the case of a husband and wife who by their joint efforts acquired property to be used for their joint benefit, applied to a man and his mistress who acquired property by their joint efforts with the intention of setting up home together.

30. In Macdonald v. Macdonald (1957) 2 All E.R. 690 a husband and wife lived with the wife's mother in a cottage of which the mother was the tenant for life and the wife was remainderman and the cottage was later sold and out of the proceeds, the mother and the wife contributed funds for the purchase of another dwelling-house, which, however, was purchased in the name of the husband who mortgaged the house as sole mortgagor, in order to raise the rest of the purchase price and the furniture for the new house was provided by the wife and her mother On the question as to who was entitled to the house, it was held that the Court was satisfied that the wife, the husband and the wife's mother had each a substantial beneficial interest in the house, which was purchased as a joint family enterprise in order to provide a home, and, since no precise calculation of their interests was possible, they should be regarded as having been entitled beneficially in equal shares.

31. In Bull v. Bull (1955) 1 All E.R. 253, the plaintiff and his mother, the defendant, together purchased a freehold house, the plaintiff contributing a larger part of the purchase price than the defendant and the conveyance was taken in his name; and the money contributed by the defendant was not intended to be a gift from her to the plaintiff and the parties lived together in the house till a particular year when the plaintiff married and it was arranged then that the defendant should occupy two rooms while the plaintiff and his wife should occupy the rest of the house. Subsequently differences arose between the parties and the plaintiff brought an action for possession of the rooms occupied by the defendant. It was held that since the effect of the purchase of the house was that the plaintiff and the defendant became beneficial tenants in common of the proceeds of sale of the property which was subjected to the statutory trust for sale, the defendant had a right to participate in the enjoyment of the property until it was sold and the plaintiff's action for possession failed.

32. In Halsbury's Laws of England, Third Edition, Vol. 38, page 868, it has been observed that the principle that the property is deemed to be held on a resulting trust applies where several persons purchase property in the name of one; and where, however, two or more persons purchase property in their joint names or transfer property into their joint names, to contribute the purchase money or property in equal shares, they hold the property as joint tenants with benefit of survivorship both at law and in equity, unless there is evidence of a contrary intention on their part at the time of the purchase or transfer or there are circumstances from which such an intention can be inferred; and if they contributed the purchase-money or property in unequal shares, whether the property is purchased in the name of one or in their joint names, there is a tenancy in common between them in equity, though even in this case the equitable tenancy in common may be rebutted by evidence or circumstances.

33. Snell has observed in his Principles of Equity (Twenty-seventh edition) at page 38:

(C) Equal division:

(1) the principle. In addition to equity's ancient dislike of a joint tenancy the maxim 'equality is equity' may be illustrated by a number of more modern instances. In general, the maxim will be applied whenever property is to be distributed between rival claimants and there is no other basis for division. I think that the principle which applies here is Plato's definition of equality as a 'short of justice': If you cannot find any other, equality is the proper basis.

34. In the case now before us, it having been proved that the acquisitions of the A schedule properties were made by the joint efforts and with the income accrued from the joint efforts of these brothers, which had been mixed up with the personal income of the first defendant from the races, in the absence of evidence as to what exactly was the contribution made by the respective parties towards these acquisitions and in the absence of any agreement between the two brothers as to their respective interests in the joint acquisitions, the plaintiff will be certainly entitled to his half share in the A schedule properties. We therefore confirm the judgment and decree of the learned single Judge on the original side and dismiss this appeal. (O.S.A. No. 8.1. of 1975 with costs).


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