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Tincowri Pramanik Vs. Narayan Chandra Mukherjee and anr. - Court Judgment

LegalCrystal Citation
CourtKolkata High Court
Decided On
Case NumberA.F.O.D. No. 178 of 1950
Reported inAIR1957Cal364
ActsSuccession Act, 1925 - Section 307 and 307(2)
AppellantTincowri Pramanik
RespondentNarayan Chandra Mukherjee and anr.
Appellant AdvocateAtul Chandra Gupta and ;Surathi Mohan Sanyal, Advs.
Respondent AdvocateJitendra Kumar Sen Gupta, ;Shib Krishna Dutta and ;Mrinal Kumar Ghosh, Advs.
DispositionAppeal dismissed
Cases ReferredWatkins v. Cheek
- .....the powers of sale by the executor the tenor of the entire will will have to be examined.11. in clause 1 umasasi is named as the executrix 'to do all the works in accordance with the provisions of the will.'12. in clause 5 narayan on taking out probate after the death of umasasi will be entitled to transfer any portion of the estate for the preservation of the estate or for legal necessity after taking the permission of the probate court.13. in clause 6 provision is made to the effect that under certain contingencies and in the absence of certain persons and classes of heirs umasasi shall have an absolute right in all the properties.14. in clause 7 reference is made to certain other contingencies when the properties would vest in charity. even when so vested the property is to be kept.....

R.P. Mookerjee, J.

1. Nagendra Nath Banerjee died in 1939 leaving a will, dated 1-2-1931. He died without any issue and appointed his widow Umasasi as executrix. On 31-8-1944, Umasasi conveyed the property in suit to defendant No. 2 Tincowri Pramanik for a consideration of Rs. 24000/- purporting to pay herself the alleged dues of over Rs. 14000/ from her husband and for other debts incurred by her. The plaintiff Narayan Chandra claimed that Umasasi had got only a widow's estate under the will and she had no right or authority to dispose Of the property and that even if the same had been effected in her capacity as executrix, it was a collusive one and without any consideration. The plaintiff claimed to have a reversionary interest under the will. He accordingly prayed for a declaration that the will (alienation?) was invalid and did not bind the plaintiff or the estate of the testator,

2. The principal defence was by the transferee Tincowri, defendant No. 2. It was contended 'inter alia' by him that the testator had left liabilities and the executrix had conveyed the property in due course of administration and that she had not assented to the legacies in respect of the property in suit. The allegations made in the plaint either about collusion or absence of legal necessity or want of consideration were denied. Defendant No. 1 Umasasi filed a written statement, supporting her action and the title which she had created in favour of defendant No. 1.

3. The learned Subordinaee Judge decreed the plaintiff's suit holding 'inter alia' that the sale bythe executrix would enure for her life time only and was not binding either upon the plaintiff or upon the estate of the testator. Defendant No. 2 has appealed to this Court.

4. On behalf of the appellant, it has been contended by Mr. Gupta that under Section 307, Succession Act, a transfer by the executrix would be valid and binding on the estate, she having full and complete authority to dispose of the property and only if there were specific restrictions in the will, the executrix would not have such wide powers. In the present case it was contended that there was no such restrictive clause and the transferee had no duty to enquire outside the will and even if an enquiry had actually been made, such action would not in any way impose upon the transferee responsibilities which did not otherwise rest on him.

5. The first part of the proposition is notcontested by Mr. Sen Gupta appearing on behalf of the respondent. It is, however, contended that under the will left by Nagendra the executrix had not been given full and unrestricted authority to dispose of the properties. In view of such restrictions, title would not pass in favour of the transferee unless the previous sanction of the probate Court had been obtained. In the present case, the transfer was a voidable one. It is further urged that an enquiry had actually been made by the solicitor on behalf of defendant No. 2, and it was disclosed during such enquiry what the real state of affairs was. That the estate was not liable for the alleged debts claimed by the widow personally was clear and apparent to the enquiring solicitor. The transferee has not further produced such materials as he had collected during the enquiry. There was no justifying reason to support the transfer made. Mr. Sen Gupta further contended that the alleged transfer was without any consideration and was a collusive one.

6. We proceed to consider in the first place the provisions contained in the will, dated February 1, 1931, left by Nagendra Nath Banerjee.

7. The testator cancels and revokes an earlier will and proceeds to give detailed descriptions of his relations indicating the grounds why he is not making any provisions for some of them while providing for others.

8. After making lump sum provisions for a maternal aunt and the widow of the spiritual guide, reference is made in Clause 4 of the will that Rs. 14000/- lent in the name of the testator to one Bejoy Ratan Bose actually belonged to his wife Umasasi. Further reference will be made to this clause hereafter.

9. In Clause 5 of the will it is provided:

'If after my death my aforesaid sister's son, the highly blessed Sreeman Narayan Chandra Mukhopadhyaya or any of his male children remain alive then my wife, the said Sreemati Uma-sashi Debi, will get all the properties left by me in the right of a Hindu widow; and on her death my aforesaid sister's son will get the said properties in life interest, and if necessary, he will be entitled to take probate in his own name after the death of my wife. And if there be necessity for money for preserving the said properties for any particular legal necessity, then he will be entitled to transfer any portion of the same on taking the permission of the Probate Court. And if after the death of the said sister's son, any of his sons remains alive, he will get all the properties of my Estate in absolute right as soon as he will attain majority. So long as he does not attain majority, the income of the properties leftby me will be spent for his maintenance and education, and if any surplus be left, the same will remain in deposit in Bank and he will get the same on attainment of majority. If more than one son be born to Sreeman Narayan and if they remain alive after his death and attain majority then they will get the same in equal shares.'

10. As at the time of the death of the testator both Umasasi and Narayan were alive, it is not necessary to refer at this stage to the provisions made on the contingency if Narayan were not alive on that date. The provisions referred to above indicate that Umasasi got under the will only the limited estate of a widow. Umasasi was named as the executrix and she tool out the probate. Is there any provision in the will restricting the powers of sale by the executor so as to attract Section 307(2) of the Succession Act? In the absence of a clear and specific provision dealing with the powers of sale by the executor the tenor of the entire will will have to be examined.

11. In Clause 1 Umasasi is named as the executrix 'to do all the works in accordance with the provisions of the will.'

12. In Clause 5 Narayan on taking out probate after the death of Umasasi will be entitled to transfer any portion of the estate for the preservation of the estate or for legal necessity after taking the permission of the Probate Court.

13. In Clause 6 provision is made to the effect that under certain contingencies and in the absence of certain persons and classes of heirs Umasasi shall have an absolute right in all the properties.

14. In Clause 7 reference is made to certain other contingencies when the properties would vest in charity. Even when so vested the property is to be kept intact. The property itself or any income arising therefrom by letting it out may be utilised for the purpose of the trust. If the institution named ceases to exist the income from the property is to be utilised for meeting the expenses of a similar institution at the nearest place. .

15. Under Clause 9 there is a direction that until the deposit of Rs. 2700/- from Niharbala, a sister-in-law of the testator, is paid off, 'no legatee shall get any property or money and no manner of transfer made by the executrix shall be operative.'

16. Umasasi is under Clause 11 to be executrix without any security.

17. If there be a clear and specific provision imposing restrictions on the powers of the executor there is no difficulty in holding that sub-sec. (2) of Section 307, Succession Act, is attracted. If, however, there is no such direct and specific provision how is the intention of the testator to be ascertained? Clause (i) of Sub-section (2) of Section 307 requires that the restriction is to have been imposed by the will binding the executor. It is, therefore, not open to refer to any extrinsic evidence, oral or documentary, for ascertaining whether the testator intended to impose such restrictions. The terms of the will are to be scrutinised. The document is to be read as a whole to find out whether the testator had intended to impose any restrictions or has allowed the executor complete discretion as under sub-s. (1) of Section 307 of the Act, This may be ascertained from the general tenor of the will and from the intentions of the testator as expressed in making the dispositions in the will.

18. A restriction may be express or implied. As was held in Shri Beharilalji v. Rajbai, 23 Bom 342 (A), Maneklal v. Keshav, AIR 1938 Bom 71 (B), Nistarini Dassi v. Nundolal Bose, 30 Cal 369 (C), there may be circumstances disclosed inthe will itself from which the Court may ascertain whether the testator had inferentially intended that the powers of alienation by the executor either will be restricted or will not be there at all.

19. It has also been pointed out that there are restrictions which limit the powers of transfer by sale or mortgage or charge. The restrictions which are so imposed, either in whole or partially will have to be interpreted by the Court as restricting the intention of the testator. See the observations in Vaughan v. Heseltine, 1 All 753 (D).

20. Keeping in view the principles enunciated above, if we analyse the terms of the will now in suit before us, it appears that the intention of the testator was definitely to save the only property he had and to keep it intact until it vests under certain contingencies absolutely either on his wife Umasasi or the son of Narayan. Under every other contingency the holder for the time being will have a limited estate, Umasasi herself is to get the rights of a Hindu widow. When Narayan gets the property he will also have only a life interest. He is to take out a fresh Rrant from the probate Court and the power of alienations, so far as he is concerned, is definitely limited under the will. If he is required to dispose of any portion of the property for the purposes mentioned in the willy he can do so only after obtaining the permission of the probate Court. On the happening of certain other contingencies, if Durgarani gets the property it is also to be for her life. If on the happening of other contingencies, the property vesta in the Trustees of the Chittaranjan Beva Sadan, they will be entitled either to use the house as a hospital or to let it out. If the institution Ceases to exist, the income of the property will be available for meeting the expenses of any other new and similar institution.

21. The indications, therefore, are clear and unequivocal that the principal and guiding intention of the testator was to keep the property intact in the hands of all the limited owners without any right of sale or disposal until the property vests absolutely in certain legatees.

22. It has to be remembered that the property in suit and the subject-matter of the testamentary disposition was the only immovable property belonging to the testator.

23. AS regards the provisions about the rights and powers of executors there is one under which Narayan, when he becomes the executor, is denied the right to transfer for necessities without obtaining the permission of the Probate Court. In the case of Umasasi there is a provision absolutely taking away her right to transfer the property until the deposit made by Niharbala with the testator is returned to the latter.

24. The question for consideration is whether the intention as expressed by the testator about the treatment of the property in the hands of the legatees is relevant for determining his intention so far as the right of the executors is concerned. In the absence of any other clear expression of intention about the executorship we think that such expressions of intention about the treatment of the property in the hands of the legatees as also the future use of the property is relevant and material for determining whether there is any restriction on the powers of the executor. If this be the proper approach, there is no room for doubt in the present case that the testator intended that until the property vested absolutely in some body the property was not to be freely sold with the effect that the executors' powers were restricted inferentially.

25. There is, however, one specific clause towhich reference has been made by both the parties contending that the provisions of this clause supports the case as made by either. The clause in question is Clause 9 of the will limiting the powers of the executors up to a certain point of time. On behalf of the transferee it is contended that such a specific provision actually supports the interpretation that beyond the period mentioned in Clause 9, the testator did not intend to limit the powers of the executor in any way. On the other hand it is contended on behalf of the plaintiff that this clause by itself cannot be interpreted, but the general tenor of the will and the restrictions imposed on Narayan as executor have to be referred to. If we interpret Clause 9 along with the restrictions imposed upon Narayan it will not be unreasonable to hold that in the special facts of the present case, the testator had intended to restrict the powers of the executor. We hold, therefore, that reading the will as a whole, the testator had intended to impose restrictions on the powers of all the executors, including Umasasi as executrix to deal with the property without obtaining permission from the Court which had granted the probate.

26. It is argued in the alternative on behalf of the plaintiff that even if it be held that the executrix Umasasi was not restrained by the will as a whole, there were restrictions against Umasasi making any transfer until the conditions laid down in cl, 9 of the will were strictly fulfilled.

27. It appears that Niharbala, a sister-in-law, had kept Rs. 2700/- in deposit with the testator. Under the will, the refund of this deposit was to have precedence over every other payment by the executrix, and until such payment was made the executrix was not to effect any transfer.

28. To set round this provision what the executrix did was to borrow the required amount on a promissory note, dated 28-6-1943, from one Sarat Kumar Mitra (Ex. B) at twelve per cent, interest and paid off on 2-7-1943, Niharbala the amount deposited by her. The property in suit was sold to clear the debt incurred by the executrix as aforesaid and also to pay herself off an alleged debt of Rs. 14,000/- due to the executrix personally. This, in our view, contravenes the restriction imposed by the testator under Clause 9 of the will. The executrix was indirectly selling the property to refund the deposit made by Niharbala.

29. Under sub-sec, (2) of Section 307, Succession Act, the executrix ought to have moved the Probate Court for sanction, and the subterfuge as adopted was clearly to by-pass the provisions in the will as also the statutory requirements which she was not entitled to do. If the executrix found that she had no assets in her hands from which the deposit of Niharbala could be paid off without creating a charge on the only property left by the testator or by disposing it off, it was clearly her duty to move the Probate Court to sanction the arrangement which she proposed. The executrix should not have raised a loan to pay off Niharbala and then to sell the property without obtaining the approval of the Probate Court to either of these acts. This objection also is well founded.

30. On the interpretation of the will as indicated above, the other questions do not arise. But we proceed to consider these as raised by the parties before us.

31. It has been contended before us on behalf of the plaintiff respondent that under Section 307(1), Succession Act, the executor is entitled to deal with the property only for purposes of administration. Reliance was placed by both the partieson the observations of the Judicial Committee in Sunil Kumar v. Sisir Kumar . To appreciate the principles laid down in the authority mentioned we have to keep in view the special facts with reference to which such observations were made. The testator in that case left a business of printing, publishing and book-selling as also certain other properties movable and immovable. The executors had mortgaged some of the immovable properties for securing money to develop the business and to open a new branch. In agreement with the findings reached by the Courts in India it was held (1) that on the terms of the will and the evidence the immovable properties were connected with the business by the testator and the executors were entitled to mortgage them for the purpose of the business and (21 that on the date of the mortgage the executors had not assented to the trust as regards both the business and the immovable properties,

32. Only two questions were taken up for consideration by the Board:

(a) having regard to sub-sec. (2) (i) of Section 307 as any restriction on the statutory power imposed the will? and

(b) had the mortgagees constructive notice of any defect in the proposed exercise of the power by the executors so as to put them in bad faith?

33. On the first point the Board found that there was no restriction imposed on the statutory powers of the executors for disposal.

34. On the second point, it was assumed, contrary to the judgment of the. Court below, that as between the executors and the beneficiaries the executors were not entitled to use the immovable properties for the purpose of the business.

'If so, did the mortgagees know, or were they so put on the inquiry that constructive knowledge must be imputed to them that the executors were not so entitled''? (p 114 of the report): (pp. 32-33 of AIR).

35. It is in connection with the second question and on the premises referred to above that it was observed:

'But the question must be whether the proposed lenders had a duty to enquire into the facts outside the will as they existed immediately prior to the testator's death. Their Lordships are unable to hold that the mortgagees had any such duty, and the nature of the inquiry held in the present case and the decisions below, show how impracticable it would be for any such inquiry to be made by an intending lender. In their Lordships' opinion, much of the usefulness of the statutory power conferred by Section 307 on executors in India would be nullified if such a duty of inquiry was imposed on parties dealing with executors'.

36. The mortgagees were accordingly held to have obtained a good title from the executors and it was thought to be unnecessary to consider whether the ground of decision of the Courts below was justified, but their Lordships were not to be taken as indicating any contrary opinion.

37. Whether the executrix was in the case now before us acting, when executing the conveyance, as a legatee or as the executrix, or in other words she had assented to the legacy will be considered hereafter.

38. It is quite clear from the Judgment of the Judicial Committee that in that case there was no evidence that the mortgagees knew any thing outside the terms of the will and the recital in the mortgage. The proposed vendor had no duty to enquire into the facts outside the will. The Judicial Committee was not called upon and did not consider what would have been the position ifthe lenders had made enquiries and had become cognisant of the defect or deficiencies on the part of the executors.

39. It is now well settled that the powers of the executors in India as provided in Section 307, Succession Act, 1925 (corresponding to Section 269, Succession Act, 1896 (Act X of 1896) ) are, at least, as extensive as those enjoyed by executors in England before 1926. Reference has repeatedly been made to the observations of Lord Thurlow in Scott v Tyler. (1788) Dick 712 (725): 21 ER 448 (453) (F):

'It is of great consequence that no rule should be laid down which may impede executors in their administration, or render their disposition or the testator's effects unsafe, or uncertain to the purchaser; his title is complete by sale and delivery; what becomes of the price, is no concern of the purchaser.'

40. This proposition is stated in the following terms by Parwell on Powers, (Third Edition at page 94):

'A purchaser from executors selling under a power of sale created by a charge of debts is not bound, and ought not, to enquire whether there are debts or not, if such sale is made within reasonable time after the testator's death.''

41. As observed by Farwell,

'this rule is inapplicable to a purchaser who has actual knowledge that all debts have been paid, and that the purchase-money is to be applied only for the vendor's own use and not for any purpose whatever connected with the estate.'

42. Reference may be made in this connection to the observations of Lord Hatherley in Cor-ser v. Cartwright, (1875) 7 HL 731 at p 741 (G).

43. The leading authority on this point is Watkins v. Cheek, (1825) 2 Sim & St. 199: 57 ER 321 (H). As was pointed out by Sir John Leach, V. C., the general power of the executor having wide and unrestricted discretion will not be attracted when a transferee, whether a mortgagee or a purchaser comes to know from the nature of the transaction that the executor was not acting in the execution of his duty but is committing a breach of trust as when the consideration of the mortgage or sale is a personal debt due to the executor. The same view was expressed in In re Vena and Furze's Contract, (1894) 2 Ch 101 (113-114) (I). (See also 14 Halsbury, Kailsham Edition Section 730 page 394).

44. The rules laid down by the English Courts have been applied in this country also, and some of the authorities referred to above have been cited with approval (In the goods of Nundolal Mul-lik. 23 Cal 908 (J); 30 Cal 369 (C)). In the recent decision by a Division Bench of this Court in Adeline v. Sunderlal, : AIR1950Cal559 , these propositions were laid down specifically by Das, J. He cited with approval Watkins v. Cheek (H) (supra) and observed that the alienee from an executor who was acting as such had a right to infer that the. latter was acting fairly, that immunity was, however, lost when the alienee had notice, actual or constructive, of the fact that the executor was acting in breach of trust. He reiterated the maxim enunciated by Lord Kenyon, 'Let executors do their duty and let the authority cease when injustice begins.'

45. If we examine the conveyance executed by Umasasi in favour of defendant No. 2, it will appear that the property was being transferred in course of the administration Of the estate of the testator 'to pay off the different legacies under the said will of the said Narendra Nath Banerjee and other liabilities of the said estate.'

46. The solicitor of the purchaser had madedetailed enquiries about the debts, liabilities and legacies for the payment of which the conveyance was being executed. The solicitor had also made enquiries as to the financial condition of the testator at the time of his death and various other details. The enquiry as was being effected was more in the nature of an enquiry which is required when a limited owner is creating a liability or making transfer for legal necessity. The solicitor who was examined at great length had stated in course of his deposition that it was his duty to see if there was any breach of trust, using almost the same language as had been used in some of the English decisions already referred to.

47. On the authorities mentioned above, when the transferee has made an enquiry or has constructive knowledge of details about the administration by the executor, he cannot fall back upon the dictum of the Judicial Committee that no enquiry beyond what appears in the will is required to be made by him as he is a transferee from an executor. If no enquiry had been made beyond what appears in the Will it would be open to the transferee to rely upon the wide powers given by sub-s. (1) of Section 307 of the Succession Act as interpreted by the Judicial Committee. When an enquiry is actually made specially of the detailed nature as in the present case, the transferee cannot plead ignorance of the real position, far less rely upon the unrestricted powers of the executor.

48. We have, therefore, to ascertain what were the particulars of the debts, legacies and liabilities referred to in the conveyance and of the nature and substance of the enquiry actually made and what materials were placed before the solicitor concerning the estate of the testator and the debts and liabilities to clear which the sale was being effected. It appears from the evidence as disclosed that a pleader of the Alipur Court, Santosh Kumar Ganguly, was acting for defendant No. 1 Umasasi and a solicitor, Pankaj Kumar Sen, was acting for the purchaser, defendant No. 2. Santosh has not been examined in this case. The steps taken for enquiry are, therefore, to be ascertained mainly from the deposition of the solicitor for defendant No. 2. (Here his Lordship examined the evidence on the record and reached the conclusion that the purchaser had obtained information and materials which put him to further enquiry & clarification and that he could not after making such detailed enquiry fall back upon the provisions of Section 307(1) of the Succession Act, After dealing with certain other minor points his Lordship concluded the judgment thus:) On the conclusions reached by us it must be held that the interest of Umasasi in the property had been conveyed. The transfer is good and valid during the life time of Umasasi. The estate will not be bound by the transaction after the death of Umasasi.

49. This appeal is accordingly dismissed with costs to the plaintiff-respondent, hearing fee fifteen gold mohurs.

50. The cross-objection is not pressed and is dismissed without any order as to costs.

Sarkar, J.

51. I agree.

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