Calcutta High Court
Biswanath Pershad Mahta vs Jagdip Narain Singh on 16 August, 1912
Equivalent citations: (1913)ILR 40CAL342
JUDGMENT Jenkins, C.J.
1. The plaintiffs have brought this suit to realize a mortgage security executed in their favour by Babu Jagdip Narayan Singh, defendant No. 1 They have made defendants to the suit both Jagdip Narain Singh and his only son, Bindeswari Pershad Singh, it being their case that the son, who was a minor at the date of the mortgage, is as much bound by it so far as it creates a security on the property comprised in it, as the father by whom it was executed. The suit was dismissed as against the son and hence this appeal.
2. The mortgage, Ex. 1, is dated the 21st of November 1893, and to appreciate its meaning it should be borne in mind that the mortgagees were a firm of bankers or mahaians.
3. It begins in these terms: "Whereas I, the declarant, have taken lease of certain mauzas and have to pay the rent thereof to the proprietors instalment by instalment; but the rent is not realized in due time from the tenants of the leasehold mauzas, and the proprietors are always making pressing demands; therefore I have of my own accord, and free will opened for the payment of the rent to the proprietors due on account of the lease-hold mauzas a khata for Rs. 5,000 bearing interest at the rate of Re. 1 per cent, per mensem with the firm of Babu Birkeshwar Lal Parmeshar Narain at Koochi Hiranand Sahu appertaining to Thana chawk Kalan, one of the quarters of Patna city, as per details given below."
4. Then there follow provisions regulating the details of the transaction. The first clause provides for two chittas, one to be kept in the bankers' place of business, and the other to remain with the mortgagor, and then says "all sums paid into and received from the kothi by me shall be entered in both the chittas." The succeeding clauses deal with interest, periodical adjustments, the closing of the transaction, and then the charge is created in these terms (read Clause 7). The schedule to the mortgage describes the property, and from this description it is apparent that the instrument professes to charge the entire family interest in this property. This has not been disputed before us.
5. It is the plaintiff's case that the transaction has been closed, and that there is due to them on the balance of the account a sum of Rs. 5,000 for principal, after giving up Rs. 7-0-9, and Rs. 3,554-10-8 for interest.
6. The amounts which go to make up this sum of Rs. 5,000 are shown in a tabular form in the judgment of the Subordinate Judge where nine items are shown totalling Rs. 6,279-10 in all, and extending from Jeyt Sudi 6th to Magh Budi 11th Sambat 1952.
7. The first two may be left out of consideration, as they are beyond the limits claimed by the plaintiffs.
8. The rest call for a brief explanation, excluding for the moment the last item of Rs. 600; it has been proved to my satisfaction, not merely by oral testimony but by documentary evidence, that is above all cavil that all these items were expended on legitimate family purposes, as, for instance, the payment of rent, the payment of Government revenue, and family marriage expenses. We have been taken through the items which go to show this with minute detail, but I do not propose to do more than state, as I have done, the general result of this investigation, as no argument was addressed to us in disparagement of this conclusion. The attempt to evade liability by pleading the immorality of defendant No. 1 has been as unsuccessful as it was unmeritorious, and it was particularly unmeritorious, for there is strong reason to think that defendant No. 1 is in reality the person responsible for the advancement of this defence.
9. It was argued that the mortgage was security only for the amount drawn or paid on account of instalments of rent, and, in support of this, reliance was placed on the recital I have read. But this (in my opinion) places too narrow, a construction on the instrument: the recital explains how the mortgage became necessary, but it does not control its operative provision. The intention and effect of the instrument was, I think, to secure the balance from time to time due on the current account. The result then is this: the mortgage purports to charge the entire interest in the property, and, apart from the Rs. 600 with which I will later deal, the whole of the Rs. 5,000, claimed as principal, was advanced for legitimate family purposes. Why then should not the mortgage be enforced against the entire family interest?
10. The law on this subject is thus stated by the Privy Council in Surai Bunsi Koer v. Sheo Persad Singh (1879) I.L.R. 5 Calc. 148, 165.: "The right of co-parceners to impeach an alienation made by one member of the family without their authority, express or implied, has of late years been frequently before the Courts of India, and it cannot be said that there has been complete uniformity of decision respecting it. All are agreed that the alienation of any portion of the joint estate, without such express or implied authority, may be impeached by the co-parceners, and that such an authority will be implied, at least in the case of minors, if it can be shown that the alienation was made by the managing member of the family for legitimate family purposes.
11. This formulates a clear and precise principle, and it would seem to narrow the problem of the validity of a manager's alienation to this: had he an express authority, if not, had he an implied, authority? At the same time the passage indicates the kind of condition which would justify such an implication when it is pointed out that as against a minor co-parcener it may be implied, if there was a legitimate family purpose.
12. But I do not read this statement of the law as laying down that these are the only conditions under which authority can be implied; each case must be judged according to its own peculiar circumstances. It is true that the word used in this passage is alienation; but a mortgage is an alienation and none the less so because it is for a particular purpose; and this is recognised by the Transfer of Property Act.
13. Moreover, this view has the sanction of the highest judicial authority, for a mortgage by a managing member has been upheld on this principle by the Privy Council, and in illustration of this I may refer to Gharib-ullah v. Khalak Singh (1903) I.L.R. 25 All. 407; L. R. 30 I. A. 165.
14. No doubt in the present case the mortgage was executed before the advances were made, but I fail to see that this places any obstacle in the plaintiff's way, in view of the fact that the advances were all made for legitimate family purposes and the mortgage was a necessary part of the arrangement. And I hold that in the circumstances defendant No. 1 as the managing member had implied authority to execute the mortgage so as to make it unimpeachable by his minor son. It follows, then, that the alienation by way of mortgage is good, and that it can be enforced as a mortgage against the defendant No. 2 as well as against his father defendant No. 1.
15. So far I have dealt with the case apart from the item of Rs. 600: now it is necessary to consider how matters stand regarding this item.
16. The plaintiffs have been unable to show how it was expended: the defendants have refrained from throwing any light on the point, and yet it is difficult to suppose that they have not family books of account and available sources of information that would show what was done with this sum.
17. It has been forcibly argued that in view of all the circumstances the position would appear to be one where it would be reasonable to apply the provisions of Section 106 of the Evidence Act and hold that as the mode of expenditure is especially within the knowledge of the defendants the burden of proving how it was made was on them: see Hunoomanpersaud's case (1856) 6 Moo. I. A. 393, 418.
18. But even if the plaintiffs cannot show that this sum was expended for a legitimate family purpose, on the other hand, the defendants have wholly failed to show that it was used for an immoral purpose. And so we have the position indicated in the case of Luchmun Dass v. Giridhur Chowdhry (1880) I.L.R. 5 Calc. 855.
2. This is a determination of a Full Bench of this Court which has given rise to much discussion, and in token of this I need only refer to two recent but apparently discordant decisions: Maheswar Dutt Tewari v. Kishun Singh (1907) I.L.R. 34 Calc. 184. and Kishun Pershad Chowdhry v. Tipan Pershad Singh (1907) I.L.R. 34 Calc. 735.
3. On the strength of this Pull Bench determination it is urged on behalf of the respondent that we cannot decide in the plaintiffs' favour without a reference to a Bench specially constituted. At most, however, this contention can only refer to the Rs. 600, and the plaintiffs say they would give up this amount rather than incur the delay and expense of a reference.
4. But is the reference necessary, having regard to the circumstances of this case? First, then it has to be seen what the Full Bench determined.
5. One of the questions propounded to them was this: "In the case of a Mitakshara family consisting of a father and one minor son where the father being the manager raises money by hypothecating certain ancestral family property by bonds, and it is not proved on the one hand that there was any legal necessity for his raising the money, nor on the other that the money was. raised or expended for immoral or illegal purposes, or that the lender made any inquiry as to the purpose for which it was required, can the lender, the mortgagee, enforce by suit against the father and the son the payment of his money by sale of the property during the father's lifetime?" The answer which was returned by the Full Bench was in these terms: "The mortgage itself upon which the money was raised could not be enforced, but the debt contracted by the father, being itself an antecedent debt within the meaning of the rulings of the Privy Council, and the son being a party to the suit, the mortgagee, notwithstanding the form of the proceedings, would be entitled to a decree directing the debt to be raised out of the whole ancestral estate inclusive of the mortgaged property."
6. This answer has occasioned much discussion, but it is now the accepted view that it cannot mean that the mortgage is incapable of enforcement against the father to the extent of his share.
8. But even with this gloss the ruling is not free from difficulty.
9. If in execution of a decree against the father alone for a debt unconnected with any immoral or illegal purpose, a part of the family property is sold in execution, the son's obligation to pay his father's debts would of itself afford a sufficient answer to a suit brought by a son to recover the property. At the date of the Full Bench decision the result would have been the same, though the suit was for enforcement of a mortgage and the son was not a party to it. Since then, however, the Transfer of Property Act has been passed, and by Section 85 it is provided: "Subject to the provisions of the Code of Civil Procedure, Section 437, all persons having an interest in the property comprised in a mortgage must be joined as parties to any suit under this chapter relating to such mortgage: provided that the plaintiff has notice of such interest." In Lala Suraj Prosad v. Golab Chanel (1901) I.L.R. 28 Calc. 517. it was held that this section is compulsory. So a morgtagee must now in a suit on a mortgage of the joint property of a Mitakshara family executed by a father join as a party the executant's son, though he was a minor at the date of the instrument.
10. Such a son therefore is a person having an interest in the property comprised in the mortgage, and it is on that account alone that he is a necessary party. Moreover, it is only to a suit under Chapter IV of the Transfer of Property Act now reproduced by Order XXXIV, Civil Procedure Code, relating to the mortgage that he is a necessary party.
11. The purpose of joining the son is not to obtain a personal decree against him on the strength of his obligation to pay his father's debts, but primarily to give him an opportunity of redeeming as a person interested in the mortgaged property and incidentally to resist the suit as against himself on the ground that the character of the debt absolved him from, any obligation. In this connection regard may be had to Section 90 of the Transfer of Property Act now reproduced in Order XXXIV, Rule 6 of the Civil Procedure Code.
12. That it was not necessary to make the son a party to such a suit before the Transfer of Property Act was passed, or where its provisions did not apply, is clear from the cases to which reference was made in Lata Surai Prosad's case (1894) I.L.R. 28 Calc. 517. And though he was not a party, a decree could be passed for the sale of the entirety, of the mortgaged property. The son's remedy in such a case was that he could sue to recover the property, provided he could show that the debts were contracted for immoral purposes and the purchaser had notice that they were so contracted: Surai Bunsi Koer's case (1879) I.L.R. 5 Calc. 148; L. R. 6 I. A. 88. Thus it will be seen that the law has been materially modified by Statute and Statutory rule since the Full Bench decision. But more than that, we have in this case facts which take it outside the scope of the Full Bench decision. Here the sums covered by the mortgage were, with the exception of Rs. 600 advanced for a legitimate family purpose, and so there is a sufficient foundation for a decree for sale on the mortgage. And though it is not shown that the Rs. 600 was for a legitimate family purpose, it certainly was not for any immoral purpose, and in the circumstances I think it may be regarded as a debt of the father binding on the son, and that the second defendant cannot be permitted to redeem the mortgage, except on the terms of paying off the Rs. 600 as well as the balance of the Rs. 5,000 which is shown to have been contracted for legitimate family purposes.
13. The decree of the Subordinate Judge must therefore be reversed, and a mortgage decree passed on the footing of Rs. 5,000 being due for principal. Unless the parties agree, there must be an account of what is due for interest at the mortgage rate. On payment of the amount so found by the defendants or either of them there will be the usual direction for delivery up of the documents, and if required for retransfer. In default of payment within six months of this decree or the ascertainment of interest, whichever may be the later date, there will be a decree for sale and application of the proceeds. The plaintiffs must have their costs of the suit and appeal which will be added to their security.