1. I have had the advantage of perusing the judgment of my learned brother. As regards the applicability of Section 43 of the Transfer of Property Act, in case the gift should be held invalid, I entirely agree with him.
2. The validity of the gift under Muhammadan Law is a more difficult question regarding which, even if I saw reason to disagree with him, I should do so with extreme diffidence. I see no reason to differ, and agree to the finding for which he proposes to call.
3. Tyabji, J.--The plaintiff sues to enforce a mortgage, Exhibit A, executed by the 1st defendant on 2nd December 1907. The property mortgaged did not belong to the 1st defendant but solely to his father, the 2nd defendant.
4. The 2nd defendant died before the suit came on for hearing.
5. On the death of the 2nd defendant all his estate devolved on the 1st defendant under Muhammadan Law, the defendants being Muhammadans.
6. The plaintiff contends that under Section 43 of the Transfer of Property Act, the mortgage purported to be made by the 1st defendant will operate on the 1st defendant's interest in the property mortgaged. The reply is:
7. (1) that the property did not belong to the 2nd defendant at his death, and that consequently it has not devolved on the 1st defendant;
8. (2) that even if it has devolved on the 1st defendant, Section 43 does not apply. These were not the contentions on which the suit was instituted, and do not appear on the pleadings.
9. The facts leading up to these contentions are as follows:
10. According to the case of all the parties the 2nd defendant was, prior to 2nd December 1907, the owner of the property in dispute. On that day the mortgage, Exhibit A, was executed by the 1st defendant describing himself as 'son ... of Fakruddin (the 2nd defendant), Muhammadan by caste, living by cultivation and resident of Vempalli village.' The operative part is to the following effect:
On account of my necessities I have borrowed from you ... in all Rs. 300. I shall pay on demand the said sum of Rs. 300 with interest thereon.' Then the lands in question are described and the document proceeds: 'These lands bearing this assessment are mortgaged by me. I shall not alienate the said fields in favour of others by way of gift, sale, etc., till the above said amount and interest is paid. This is the deed of mortgage executed and given with my consent.' The deed is signed by the 1st defendant and his signature is attested. No one else executes the document. It is duly registered.
11. When the plaintiff instituted the suit, the 2nd defendant was living and Section 43 of the Transfer of Property Act was not available to him even on his own allegations. The allegations contained in the plaint were that the 1st defendant was the manager of the family,' that the mortgage was executed by him for family purposes, and that he acted both for himself and as agent for thn other defendants, i.e., for his father, the 2nd defendant, and for his son and daughter, the ord and 4th defendants.
12. The 1st defendant's written statement is as follows: 'The suit debt is true. It is what I contracted.
13. The 2nd defendant's written statement contains categorical denials of the 1st defendant being manager or agent. It also refers to a gift by the 2nd defendant to the 3rd defendant, under which the property is stated to have been delivered into the possession of the 3rd defendant. Since then,' the written statement continues, the 3rd defendant himself is enjoying the said property.' It is on this gift that the contentions of the defendants above referred to depend. For, if the gift was valid and effective, the property became the 3rd defendant's prior to the death of the 2nd defendant, and did not devolve on the 1st defendant as the 2nd defendant's heir, nor was it affected by any of the acts of the 1st defendant under Section 43 of the Transfer of Property Act.
14. Before the suit came on for hearing the 2nd defendant died, and Section 43 of the Transfer of Property Act became available to the plaintiff. His contention, that apart from that section the property was subject to the mortgage because the 1st defendant acted as manager and as agent of the 2nd defendant (though it was the primary case of the plaintiff and the subject of an issue), was not considered by the Courts below. Both Courts held the gift to be invalid, and that Section 43 of the Transfer of Property Act applied.
15. It was argued before us in the first place that even if the gift was invalid, Section 43 of the Transfer of Property Act would not avail the plaintiff. The argument was that to hold so would be to hold that the 1st defendant could validly transfer his chance of succeeding to an estate as an heir-apparent,' and reliance was placed upon Hamasami Naik v. Ramasami Chetti (1) for the contention that Section 43 should not be so construed as to nullify Section 6 (a) of the Transfer of Property Act, by validating a transfer initially void under Section 6 (a), This argument, however, neglects the distinction between purporting to transfer the chance of an heir apparent,'and erroneously representing that he (the transferor) is authorised to transfer certain immoveable property.' It is the latter course that was followed in the present case. It was represented to the transferee that the transferor was in preesenti entitled to and thus authorised to transfer the property. In Ramasami Naik's case 30 M.P 255 : 2 M.L.T. 167 : 17 M.L.J. 201 what the transferors 'purported to transfer, were mere possibilities of succession with the prohibition in Section 6 (a) Of the Transfer of Property Act.
16. The other cases cited on this point for the appellant have also no application In Nurul Hossem v. Sheosahai Lal 20 C.L 1 : 19 I.A. 221 there was no erroneous representation both parties knew what the facts were. In Rashmoni Dasi v. Surja Kanta roy Chowdhry 32 c.p 832 : 9 C.W.N. 1019 : 2 C.L.J. 6 the parties had contracted to sell subject to the sanction of the Court, which could not be obtained. In Pandiri Bangaram v. Karumoory Subbaraju 8 Ind. cas. 388 : 34 M.P 159 : 8 M.L.T. 285 the objection taken and upheld was that though there was an erroneous representation, the transferee was not misled by it and that unless the transferee is so misled, Section 43 does not apply.
17. None of these objections apply fn the present case. On the contrary the illustration to Section 43 seems exactly in point except that the transfer is here by way of mortgage and in the illustration it is a sale. Here, as in the illustration, the son represented that he was authorised to transfer I roperty which in fact was not his property but his father's: and if, therefore, the son subsequently as heir oblained the property' of his father the transferee 'may require the son to deliver it to him' in this case to have it declared subject to the mortgage. Whether the son (the 1st defendant) 'as heir obtained the property ', depends upon whether prior to the 2nd defendant's death he had made a gift of to property to the defendant.
18. The validity of the gift under Exhibit I must therefore, be next considered. The District Munsif held against the validity of the gift apparently on the grounds, (1) that the execution of Exhibit I was not legally proved as, though 'it was spoken to by its writer,' no attestor was called to prove its execution. The only ground of appeal with reference to this manifest disregard by the District Munsif of the provisions of Section 72 of the Indian Evidence Act was that lie 'erred in thinking that the writer of a deed is not an attestor and proof thereof by him is no proof.' No reference to (this is to be found in the judgment of the District Judge or in the grounds of appeal to this Court : and it was not questioned before us that the execution of Exhibit 1 was satisfactorily proved.
19. The District Munsif further held (2) that assuming Exhibit I to be proved, it was not valid because there was neither acceptance nor delivery of possession of the gift; as to possession he refers to and apparently accepts the plaintiff's evidence that the 1st defendant has been and is in cultivation and possession of the properties, and that the 1st or 2nd defendant has been paying the assessment.
20. He also casually says: (3) 'It is clear from the very wording of Exhibit I, that the gift was simply intended to defeat the plaintiff's claim.
21. In appeal to the District Judge it was argued that formal transfer of possession was unnecessary, as the donor find donee were living together. The District Judge considered this contention to be supported by the authority of Humera Bibi v. Najm-un-nissa Bibi 28 A.P 147 : 2 A.L.J. 778 : A.W.N. (1905) 222. He was of opinion, however, that though transfer of possession may be unnecessary, acceptance of the gift was necessary; and he held that there was no acceptance, and so the gift was ineffectual. The result is sufficiently startling. It would appear that according to the decision of the District Court, though the donee (or the person representing him) may take possession of the subject of gift, yet this is not sufficient to imply an acceptance of the gift by or on behalf of the donee. The District Judge arrived at this conclusion apparently without realizing the inconsistency to which it leads, because he misapprehended the principle that underlies the decision in Humera Bibi v. Najm-un-nissa Bibi 28 A.P 147 : 2 A.L.J. 778 : A.W.N. (1905). in that case everything had been done to transfer possession, except that the donor had not left the premises (forming part of the subject of gift) on which she was living jointly with the donee. It was there held that the donor having emphatically manifested her unequivocal intention to transfer possession, and having done everything else to transfer possession, the fact that she did not vacate the house forming part of the subject of the gift but continued to live in it, was sufficiently explained and it did not vitiate the transfer of possession which was otherwise complete and effectual.
22. In the view that the District Judge took, he asked for a finding on the issue whether 2nd defendant was or was not de facto guardian of the 3rd defendant at the time of the execution of the deed of gift, Exhibit I.' The object of tins issue appears from the judgment of tlie District Judge delivered when he accepted the finding returned by the District Munsif. On reading the District Munsif's finding, however, it is difficult to understand what exact significance the issue had for the District Munsif, and in what way he conceived the matters contained in his judgment to be relevant to the rights and liabilities of the parties. Their Lordiships of the Privy Council had occasion in Mata, Din v. Ahmad Ali 13 Ind. Cas. 976 : 34 A.P 213 : 16 C.W.N. 338 : 11 M.L.T. 145 : (1912) M.W.N. 183 : 9 A.L.J. 215 : 15 C.L.J. 270 : 14 Bom. L.R.192 : 15 O.C. 49 : 23 M.L.J. 6 : 39 I.A. 49 to encounter the notion that by the use of expressions taken from English Law especially, it may be added, if they include some Latin words such as the expression 'de facto guardian'--parties can be clothed with legal powers which they do not otherwise possess.
23. In the present case too it seems that under some similar notion the lower Courts have not considered the case on the broad principles of the law, but have strayed into questions which do not materially aid the final decision. Had the general principles been applied in a plain common sense manner, the case would have admitted of a much more satisfactory and intelligible method of decision.
24. Under Muhammadan Law (1) a transfer by way of gift must be completed by the donor. He cannot be forced to complete a gift which he has not completed. Transfer of ownership includes a transfer of the right of possession, and of enjoying the benefits arising from the property. When, therefore, transfer of ownership is purported to be made, it is not complete unless transfer of possession is also made. (2) It follows that if the donor has not given possession of what is alleged to be the subject of the gift, the alleged donee cannot, on the strength of the declaration of gift, claim to be the owner of the property and, as owner, obtain possession of it through the Court or otherwise without the consent of the donor or his suceessor-in-title. The donee cannot say : 'l have had the ownership transferred to me, give me possession.' The answer to this claim would be: The complete ownership is not in you. One part of ownership is the right to possess. That right has not been transferred to you. It is the donor alone that can transfer that right to you and thus complete your ownership.' In short, unless the donor transfers possession, the transfer of ownership itself is not complete.(3) If, however, the subject of the gift is already in the possession of the donee at the time of the declaration of gift, its possession cannot be transferred to him any more. All that is then needed for transferring the ownership, is that the donor should transfer to the donee the residuum of the rights making up the complex notion of ownership. This he can do by declaring that thenceforth the subject of the gift shall be possessed by the donee as his own property. (4) Where the donee is a minor who, though capable of owning property, is not able to be in possession of it, his place is taken by the person who in accordance with law is in charge and possession of the minor's property. (5) If a person, therefore, declares his intention to make a gift to a minor, the donor cannot be forced to carry out his intention. He may do so of his own accord, but the declaration of the intention to make a gift does not of itself give the minor donee a right to insist that the declaration shall be given effect to. (6) No doubt in this case also if the subject of the gift is already in the possession of that person whom the law entrusts with the care of the property belonging to the minor, the gift can require no farther completion by a transfer of possession, indeed it would admit of no such transfer. The change would be in the mind with which possession would be held, and not in the person who has actual physical possession of or control over the subject of gift.
25. There is no difficulty in understanding these propositions. The facts of any particular case may, it is true, sometimes make them somewhat difficult of application, but not on that account abstruse or dissociated from what is referred to in the Indian Evidence Act as the 'common course of natural events and human conduct.' Where, for instance, the person in actual care of the property of a minor donee is other than he who in accordant with law is under the obligation (and who is clothed, therefore, also with the corresponding right) of being in possession of the minor's property--in other words where the person actually in possession of the minor's property is not the legal guardian of the minor's property in such a case if the property is transferred to the possession of the legal guardian, it may be objected that the facts were such as to show that the property intended to be given to the minor would not ordinarily be placed in the possession of the legal guardian: the person actually in possession of such property being another. If, on the other hand, possession is in such a case transferred to the latter (i.e., to the de facto guardian) it may be objected that the transferee is not legally entitled to hold possession of the property on behalf of the minor, and that the possession of the transferee is not in law the possession of the minor.
26. It must, however, be always remembered that the question of possession is primarily one of fact and it must refer to 'possession of that character of which the thing is capable.' Lord Advocate v. Young (1887) 12 A.C. 544 . There may, it is true, occasionally be some difficulty in determining whether or not possession of the property was held by or on behalf of the donee after the declaration of gift. But the difficulty can seldom be lessened by attention being primarily directed not to the salient facts of the case, not to the question who or on whose behalf acts of ownership were exercised over the property after the gift and who was deriving the substantial benefit from it, but to other speculative aspects supposed to have some juristic connection with these questions of fact. The difficulty may be enhanced by trying to determine the question, with reference to the existence of relations which are still more obscure.
27. In the present case it is admitted that the 1st, 2nd and 3rd defendants lived together in the same house. The subject of the gift consisted not of the house in the common occupation of the donor and donee, [as in Humera Bibi's case 28 A.P 147 at p. 152 : 2 A.L.J. 778; A.W.N. (1905) but of a field and in the words of Domat, 'one possesses lands by cultivating them, reaping the fruits, going and coming through them, and disposing thereof at pleasure,' Attention should, therefore, have been directed in this case to the person for whose benefit these acts were performed. As the alleged donee was a minor, he could not perform them himself. The question of the de facto guardianship, i.e., the question as to which inmate of the house was in the actual care of the minor, could not materially affect a gift of this kind; for it is not as though a gift of moveable property capable of being in direct and personal control had been transferred to a person other than the guardian of the minor, either by error as to the person to whom the transfer should according to law be made or because, such transfer would immediately and more effectively provide for the subject of gift being utilised for the benefit of the minor : nor has this question arisen in the endeavour to discover the destination of the actual produce of the land. In the arguments before us the finding that the 2nd defendant was not the do facto guardian of the minor was recognised to be irrelevant, and not relied upon by either party.
28. The real question in this case, whether after the gift the donee was given the benefit of the subject of the gift or whether its produce continued to be taken and dealt with by the donor and applied to his own benefit just as he had done before making the gift, has been lost sight of. The second appeal had, therefore, to be argued without having had the case considered by the lower Courts in its real and substantia form, but through an endeavour to find a mode of decision irrespective of a finding on that essential question.
29. In this endeavour the case has been presented before us in two aspects.
30. First, it was argued that the intention of the donor was to defraud creditors and it could not, therefore, be lawfully effected. The objection that the gift was in fraud of creditors (though it was casually alluded to by the District Munsif as stated above), was not referred to in the plaint. The gift is specifically set up in the written statement of the 2nd defendant, yat the contention was not made the subject of an issue. The words of Peel, C.J., in Doe Dem Ramtonoo Mookerjee v. Bibee Jeenut (1843) Fultan 152 : 1 Ind. Dec. (O.S.) 736 seem, therefore, to be directly applicable. He says: This deed then, being of a prior date, the subsequent purchaser must impeach it for fraud; all those grounds on which a deed is generally impeached are, however, wanting in this case. There is no evidence before us that the donor was in debt at the time of making this gift, nor is there any evidence to show that he executed it in contemplation of insolvency, or with a view to defraud creditors.
31. On the other hand, on behalf of the appellant and in support of the gift it was argued that the gift being from a grandfather to his minor grandson, no transfer of possession was necessary and that, therefore, proof of Exhibit I was sufficient to establish the gift.
32. In connection with this last contention, it must first be considered whether the rule is available to the 3rd defendant and if so, to determine the effect of the rule by a consideration of its scope.
33. It is urged that the 3rd defendant cannot rely upon the rule, because a gift to a minor must be transferred to his father if the father 'is alive and present' (Baillie's Digest, first Edition, Vol. I, page 530) and in the case under consideration no such transfer is alleged: but that on the contrary the written statement of the 2nd defendant alleges (paragraph 4) that the possession was delivered to the 3rd defendant himself. That allegation taken literally is meaningless: a boy seven years old cannot take possession of a field. It is explained, however, that possession was taken on behalf of the minor by the grandfather, or in other words that transfer of possession was unnecessary. This explanation is inadequate to bring the gift within the scope of the rule. That rule is concerned with one special aspect of the general rule, that transfer of possession is necessary for completing a gift--that special aspect having reference to the fact that the guardian of the property of a minor is the donor, and the minor the donee. The present case is not such.
34. The question is always whether the requirement of the law, that the donor shall do everything to transfer all the rights making up ownership (including transfer of possession), has been complied with either by placing the subject of gift in the immediate personal control of the donee or by some act which operates to bring about the same result. The rules of law relating to possession appear abstruse and complex, owing to the failure to direct the inquiry to the ultimate use to which the subject of gift has been put and to determine whether or not it was the donee who has derived benefit from the property after the gift. The law is not made up of unmeaning technicalities. It is not abstruse and removed, from the common course of events and human conduct. The 3rd defendant has failed to come within one particular rule (that gifts to minors shall be transferred to their guardians). His failure arises from the fact that that rule is not applicable to the circumstances of this case. But a gift to a minor which in all essentials has been completed, cannot fail merely because the person who has taken charge of the subject of gift on behalf of the minor is not his father. This would be contrary to all principle and authority. The donee can authorise a third person to take possession of the gift on his behalf. Conversely the donor can give possession to a 3rd person on behalf of any donee. If any authority were needed for these propositions, it may be found in the 11th Chapter of the book on Hiba in the Fatawa Alamgiri. A person accepting possession in such circumstances would, in the majority of cases, occupy a position not distinguishable from that of a trustee on behalf of the donee.
35. These provisions cannot be applied less favourably to a minor than to one of full age; and it has been held by a Bench which included Abdur Rahim, J., that where a lady purported to make a gift to her minor paternal grandchild and 'stated in the deed of gift that she would remain in possession of the property as guardian of the minor, and on his behalf,' it was necessary to have a finding as to whether the grandmother was at the time of the gift in possession, on the assumption that if she was, her possession might be transformed by her own acts into possession on behalf of the donee though as the father of the donee was alive, (he was the 2nd defendant) the paternal grandmother could not by any act on her part make herself the guardian of her grandchild Fakir Nynar Muhamed Rowther v. Kandasawmi Kulathu Vandan 14 Ind. Cas. 993 : 35 M.P 120 . The decision in that case was ultimately against the validity of the gift as the finding was that the donor was not herself in possession.
36. Had the donor been found to have been in possession, the validity of the gift would still have depended on the further question whether after the declaration of gift, the donor had transformed her possession on her own behalf into possession on behalf of the minor as his guardian by applying the benefits of the subject of gift to the donee, or whether she had continued to apply them to her own use. For, if she had continued to apply the gift to her own use, the gift would have been liable to attack from two directions.
37. First, it would be very unreasonable to hold, in the absence of some explanation, that the transaction is real or that there is any intention to make a gift, when it is found that as a matter of fact the person who purports to hold himself forth as the donor, and as having ceased by his voluntary act to have any interest in the property, has continued without interruption to use the property exactly in the same way as before the gift, and has not permitted the donee even at the moment of the gift to have any more benefit from the subject of gift than before. The ostensible object of the gift is that the donee should take all the benefit and the donor should cease to take any. There being on the one side the words of the donor, and on the other his acts, there would seldom be any difficulty in deciding which represents his true intentions. And the legal result of the fact that there is no intention to make a gift, coupled with the fact that the donee has not derived any benefit from the subject of the gift, is that the donor is entitled to continue, as he has been continuing, in possession and enjoyment: and that the previous declaration of gift is nugatory, because it has not been followed by a transfer of ownership which implies a transfer of possession. This result is strictly in accordance with the theory of the law of gift, as appears from Rahiman Bi v. Mahomed Fatima Bibi 23 Ind Cas 651 : 15 M.L.T. 345 where the question was whether the rule, that gifts to minors from the guardians of their property are complete by the declaration of gift (provided that the subject of the gift is under the control of the guardian at the time of such declaration) was in itself a sufficient answer to the objection that the gift had never been completed. The donor there was the father of the donee, and had purported to reserve to himself what in effect was a life-interest. The facts of that case were, therefore, very different from those with which we have to deal here. The considerations referred to in that case, however, in so far as they affect the decision of the questions (1) whether the donor did in fact intend to transfer the ownership from himself to the donee and (2) whether he effectuated such transfer, are of general application.
38. Secondly, even if the Muhammadan Law were otherwise, it would, to adopt the words of Holloway, J., be very inequitable to allow the visible means of a man to be narrowed down by a transaction riot evidenced by contracts Husain Khan Bahadur v. Nateri Srinivasa Charlu 6 M.H.C.R. 356 . Holloway, J., was dealing with the converse case. But the principle to which he referred is applicable.
39. It is obvious that the rule should not be so applied that in the changed circumstances of modern life, it should be manipulated to such inequitable purposes. The object of the rule is to prevent a minor from being rendered incompetent to receive a gift from his guardian. It is not the intention of the rule to enable a minor to insist on a gift being completed in his favour, which was not in fact completed by the donor and which was perhaps never intended to be completed. Still less is it the object of the rule to enable the guardian of a minor to continue in possession and enjoyment of property, and yet as against third parties to set up a gift in favour of the minor. In such circumstances the third parties may reasonably claim that the property must be dealt with on the basis that it continued to belong to the alleged donor, who exercised all the rights of ownership over it after purporting voluntarily to part with his rights over it.
40. It is necessary for these reasons to have a finding on the question whether at tor after the date of Exhibit I and as the result of the gift referred to in it, the produce orthe income or other benefit derived from the alleged subject of the gift was applied to the use of the donee, so as to show that a transfer of ownership had been made, or whether it was continued to be applied in the same way as it was before the alleged gift.
41. The finding should be submitted within six weeks and seven days are allowed for objections.
42. In compliance with the above order, the District Judge of Cuddapah submitted the following.
44. I, therefore, find on the issue on which finding is called for, that the produce of the land or the income or other benefit derived from the alleged subject of the gift was not applied to the use of the donee, so as to show that a transfer of ownership has been made, and that it was on the contrary continued ho be applied in the same way as it was before the alleged gift.
45. This second appeal coming on for final hearing after the return of the finding of the District Judge of Cuddapah on the issue referred by this Court for trial, the Court delivered the following.
46. Judgment.--We accept the finding and dismiss the second appeal with costs.