Rampini and Wilkins, JJ.
1. This is an appeal against an order of the Judicial Commissioner of Chota Nagpore, dated the 28th April 1898.
2. The suit is one in which the plaintiffs seek to enforce a mortgage bond, dated 8th June 1884, and the defendant pleads that under Section 3, Clause (c), of Act VI of 1876 (the Chota Nagpore Encumbered Estates Act) he could not contract, and so the bond is null and void. Both Courts have found that the defendant duly received the consideration-money of this bond.
3. The Subordinate Judge held that the bond was valid, while the Judicial Commissioner has allowed the defendant's plea as to his incapacity to contract, and has dismissed the suit.
4. The facts are that the estate of one Manki Faninder came under management under Act VI of 1876 on the 23rd April 1880. Faninder had then two sons: Bhola, who had no son, and Jagar Nath, the present defendant-respondent. Faninder died in 1884, and Bhola succeeded him. Bhola died on the 19th June 1892, and the defendant Jagar Nath succeeded him. The plaintiffs instituted this suit on the 17th September 1895.
5. The question then is whether the bond executed by the present defendant-respondent after the death of Faninder, when Bhola had succeeded to his father, is null and void or not.
6. For the defendant-respondent it is contended, and this is the view taken by the Judicial Commissioner, that it is void: (1) because Jagar Nath, when he executed it was the heir to Bhola, the holder of the immoveable property for the time being who had then no son, and that therefore under Section 3, Clause (c), he could not contract; (2) that although the property is not part of the encumbered estate taken charge of under the Act, still, under Section 3, the holder and his heir are incapacitated from alienating or encumbering not merely the encumbered estate, but their immoveable property or any part thereof, the object of the Act according to this view being to prevent any one who may at any time succeed to the estate from contracting debts which may in any way interfere with the preservation of their property in its entirety.
7. On the other hand, on behalf of the appellant it has been argued: (1) that Jagar Nath was not Bhola's heir at the time of the execution of the mortgage bond; (2) that in any case he was not the heir to Faninder; and that under Section 3, Clause (c), it is only Faninder's heir that was incapacitated from (Contracting; (3) that the property mortgaged was no part of the encumbered estate, and that it is not the intention of the Act to protect the property of any successor to the holder of the estate at the time of its management being undertaken, or to incapacitate such successor from in any way alienating or charging it.
8. It is not necessary on the view we take of this case to deal with the first and third of these pleas. We may, however, observe incidentally that we think the word 'heir' appears to us to be used in the Act in its ordinary acceptation rather than its strictly legal intendment, and further, that the Judge appears to us to be right in the view he takes of Section 3 incapacitating the holder of immoveable property and his heir from alienating or charging their immovable property or any part thereof. But the question remains: Can the defendant Jagar Nath be said to be the heir of the holder of the said immoveable property within the meaning of Section 3 of the Act
9. Undoubtedly Faninder was the 'holder' of the immoveable property when its management was undertaken under the Act and Bhola Nath was his heir. At first sight it may appear that on the death of Faninder, Bhola became the holder of the estate, and Jagar Nath his heir. But on consideration we do not think that this is the meaning of Section 3. In the first place it will be seen that under Section 2 what vests in the manager is 'the management of the whole or any portion of the immoveable property of or to which the said holder is then possessed or entitled in his own right, or which he is entitled to redeem or which may be acquired by or devolve on him or his heir during the continuance of such management.' Thus, it is the holder's property and the property which may be acquired by or devolve on him or his heir which the manager is to manage, and it is such holder and his heir who are precluded from alienating or charging their property, and it would seem that it is such holder and his heir (but not the latter's heir) who are declared by Section 3, Clause (c), incapable of contracting.
10. Then, it will be seen from Section 4 that the manager during his management of the said property (i.e., of the holder at the time the management is undertaken and the property which may be acquired by or may devolve on him or his heir) is to deal with the profits in a certain way, and to apply the residue in discharge of the debts and liabilities of the holder of the property and his heir 'under the provisions hereinafter contained.'
11. These provisions are contained in Sections 5 to 12. Prom these it appears the manager is to prepare a schedule of the debts and liabilities due to the creditors of the holder and to persons holding mortgages, &c;, at the time of such determination. Debts not notified to the manager within three months are as a rule to be barred. A scheme for the settlement of such debts is to be submitted to the Commissioner, and finally as soon as such debts and liabilities are paid off, the estate is to be released from management.
12. From these provisions it would seem to us to follow: (1) that Act VI of 1876 provides a system for the management of property not in consequence of the incapacity of the owner of such property to manage it, but with the object of paying off certain specified debts, and for this purpose the property is for a time placed beyond the jurisdiction of the Civil Courts; (2) that it is the property of the holder at the time of the determination of these debts and the property which may be acquired by or devolve on him or his heir that the manager is vested with the management of, and that it is such holder and his heir who cannot alienate or charge their immoveable property and who cannot contract. The terms 'holder' and 'his heir' appear to us to be throughout the Act used in the sense of the holder of the property at the time of the determination of the debts, and his heir. They are, we think, employed in no other sense. If the holder at the time of the determination of the debts dies, his. heir no doubt in one sense becomes the holder of the property, being his, successor, but we do not consider that on this account he becomes the holder of the property within the meaning of the Act, so that his heir becomes the heir referred to in Section 3 of the Act. The word 'heir' in the Act in our opinion always applies to the person who is the holder's heir at the time of the determination of the debts and liabilities as provided in Section 8 and to no other heir.
13. It may be said that the Act must surely contemplate and provide for the event of the death of the holder of the property. But it seems to us that it was unnecessary for it to do so. As soon as the debts of the holder of the property have been determined under Section 8, it is immaterial how the property may devolve. The manager continues to manage the property of the original holder or his heir, and when the debts, to pay off which the management has been undertaken, have been paid off, the work of the manager is finished and the property released.
14. That being so, we conclude that in this case the holder of the property and his heir referred to in Section 3 of the Act were Faninder and Bhola, and that the provisions of this section in no way incapacitated the defendant Jagar Nath from contracting. The mortgage bond on which the plaintiffs sue is accordingly not void, and the plaintiffs are entitled to recover.
15. For these reasons we decree this appeal with all costs.