Patna High Court
Debilal Khandelwal And Ors. vs Damodar Das Khandelwal Alias Gulab Babu ... on 11 May, 1962
Equivalent citations: AIR1963PAT270, AIR 1963 PATNA 270, ILR 42 PAT 625 1962 BLJR 857, 1962 BLJR 857
JUDGMENT Ramratna Singh, J.
1. This appeal by defendants 1 to 3 arises out of a suit to enforce a simple mortgage bond dated the 18th April, 1949 executed by defendant No. 1 (Debilal) and his son Prahlad Rai (defendant No. 2) for Rs. 12,500 in respect of a house situated in Mohalla Chowk Bazaza in the town of Gaya. The stipulated rate of interest in the mortgage bond was 15 per cent per annum, but the plaintiff in whose favour the bend was executed, claimed interest at the rate of 9 per cent per annum only. The due date of payment of the mortgage dues was the 30th Ashwin 1357 Fasli, corresponding to the 20th September, 1951. Defendant No. 3 Is the minor son of defendant No. 2 and defendant No. 4 Is the subsequent mortgagee. The suit was instituted on the 7th September, 1955, that is, within six years of the due date of payment, but beyond three from that date.
2. The case of the plaintiff-respondent was that the joint family of the defendants-appellants owned and possessed the major shares of the South Bihar Transport Trading. Company Limited, and the defendants, with a view to own the entire business, took the aforesaid mortgage loan for purchasing the remaining shares and thus converted the Limited Company into 3 joint business, solely for the benefit of the joint family and also to liquidate the loan taken for justifying the necessities.
3. The defence of the appellants was that only Rs. 4,912/12/6 out of Rs. 12,500/- was paid by the mortgagee to the mortgagors and that the motor business for which the loan is said to have been advanced was speculative on the date and the loan was neither for legal necessity nor for the benefit to the estate of the joint family of the appellants. Another plea was that the registration of the mortgage bond was invalid and, therefore, no mortgage decree could be passed. The last plea was that on account of the invalidity of the registration of the mortgage bond, there can be no money decree either, because the suit was instituted more than three years after the due date.
4. The learned Additional Subordinate Judge of Gaya, who tried the suit, overruled all the pleas of the appellants and granted a preliminary mortgage decree.
5. The first point urged by Sri Lalnarain Sinha, learned advocate appearing for the appellants, was that the registration of the mortgage bond was invalid. The bond (Ext. 1) was scribed on the 15th April 1949 and executed on the 18th April and presented for registration before the Sub-Registrar on the same date between 10-30 A.M. and 1-30 P.M.. The Sub-Registrar refused to register the document on the 19th April as the executants did not turn up to admit the execution. Hence, a suit under Section 77 of the Indian Registration Act was instituted by the plaintiff-respondent-mortgagee against the mortgagors, defendants 1 and 2. It was taken up for 'ex parte' hearing on the 23rd January, 1951 and decreed. The decree was signed by the Court on the 14th February, 1951. The document was presented for registration before the Sub-Registrar on the 23th February, 1951, between 10-30 A.M. and 1-30 P.M. and duly registered. It was argued by Sri Sinha that, inasmuch as the document was presented for registration more than thirty days after the 23rd January, 1951 when the 'ex parte' judgment was pronounced, the Sub-Registrar had no jurisdiction to register the document and, therefore, the registration was invalid.
Sub-section (1) of Section 77 of the Registration Act provides that on refusal of the Sub-Registrar to register a document, the claimant under the document may institute a civil suit for a decree directing the document to be registered in the registration office "if it be duly presented for registration within thirty days after the passing of such decree". In other words, this is the prayer to be made by the plaintiff in such a suit. Sub-section (2) of Section 77 lays down that the provisions contained in Sub-sections (2) and (3) of Section 75 shall, 'mutatis mutandis', apply to all documents presented for registration "in accordance with any such decree". Section 75 deals with an order passed by the District Registrar in respect of a document requiring registration. Sub-section (1) of this section lays down that the Registrar "shall order" the document to be registered. Sub-section (2) provides that, if the document is duly presented for registration "within thirty days after the making of such order", the registering officer shall register the document and Sub-section (3) lays down that such registration shall take effect as if the document had been registered when it was first duly presented for registration. Sri Lal Narain Sinil a argued that the words "such order" referred to the judgment in the suit instituted under Section 77, and not the decree, but I am unable to agree, because the relevant provisions of Section 75 have to be read with necessary modifications in their application to a decree, passed under Section 77. In my opinion, the words "such order" have to be read as "such decree" for the purpose of Section 77.
6. It was then submitted by Sri Sinha that the word, "decree" in the substituted expression "such decree" means the judgment and not the decree, as defined in Section 2 (2) cf the Civil Procedure Code, which, in the absence of anything repugnant in the subject or context, is merely a formal expression of the decision or judgment of the Court. It is noteworthy that the definition is subject to anything to the contrary in the subject or context. This definition may, therefore, be modified for the purpose of the word "decree" in Section 77 of the Registration Act. Then, he referred to Rules 1, 3, 7 and 11 (1) of Order 20 of the Code of Civil Procedure. Rules 1 and, 3 state as to how judgment is to fee pronounced and signed. Rule 7 lays down that the decree shall bear the date on which the judgment was pronounced and, before signing the decree, the Judge must be satisfied that the decree has been drawn up in accordance with the judgment. Rule 11 (1) empowers the Court to direct payment of the amount of the decree by instalments "at the time of passing the decree". There is no doubt that the word 'decree' here refers to the judgment. But these provisions are of no help in interpreting the word 'decree' used for the purposes of Section 77 of the Indian Registration Act.
Sri Sinha also relied on a decision in The Brenhilda v. British India Steam Navigation Company, 8 Ind App 159 (PC), where the words "after the date of the decree" were interpreted to mean "after the date when the decree is pronounced" and not the date when the decree is reduced to writing and signing. But this decision of the Privy Council was in respect of the words occurring In a rule In the rules and regulations made by His Majesty the King, in which ft was laid down that all appeals from the decrees of the Vice-Admiralty Courts are to be asserted by the party in the suit within fifteen days "after the date of the decree which is to be done by the proctor 'declaring' the same in Court,. . . . ...." It will be noticed that the word underlined (here Into ' ') by me meant that the decree referred to in that rule was to be pronounced in Court and, therefore, it meant judgment. Their Lordships further observed that the words which are constantly used In Courts which refer to decrees in the Admiralty Court are "the pronouncing of the sentence or decree"; and their Lordships were of the opinion that the expression "the date of the decree" meant the date on which the High Court delivered the judgment and expressed what the decree was. This decision Is also of no help in the present case, because there Is not word like 'declaring' or 'pronouncing' in Section 77 or Section 75 of the Indian Registration Act. The decree in a suit under Section 77 is against the Sub-Registrar, Inasmuch as It directs him to register the document and, the Sub-Registrar cannot be compelled to register the document on strength of the judgment alone. Sri Sinha then referred to two decisions of this Court.
In Hakim Md. Idris v. Md. Kabir, AIR 1950 Pat 524, It was held that, where the amount of mesne profits is finally determined by the Court which further directs that no decree shall be prepared, unless the deficit court-fee is paid, the direction only means that the formal drawing up of the decree is postponed until the court-fee is paid; and, therefore, the time for execution will run from the date of the order determining the amount of mosne profits. He argued on the strength of this decision that the final order or the judgment passed by the Court is the date of the decree for the purposes of execution. But this decision is in consonance with the well-settled view that, for the purposes of execution under Article 182 of the Limitation Act, the date of the decree is the date when the judgment is pronounced. This principle cannot, however, he applied to a case under Section 77 of the Indian Registration Act in which the document has to be presented within thirty days of the date of the decree.
The other decision in Birendra Pd. Sukul v. Surendra Pd. Sukul, (S) AIR 1956 Pat 209 (FB) is not at all relevant, as it refers to an order of the executing Court fixing of instalments under the Bihar Money-lenders Act, it was held that inasmuch as a decree, once issued, is immutable, subject of course, to review or to any subsequent order or decree passed on appeal and subject also to the specific provisions of Order 20, Rule 11 (2), the order fixing the Instalments by the executing Court does not terminate the execution proceeding started by the decree-holder and the effect of the instalment order is only to keep the execution proceeding in abeyance. The view that for the purposes of Section 77, the period of thirty days should be counted from the date when the decree was signed by the Judge and not from the dato when the judgment was pronounced, is supported by a decision in Muthia Chetty v. Suppan Servai, AIR 1915 Mad 865. This view Is supported indirectly by a decision of the Calcutta High Court in Mahammad Abdur Rahim v. Mahammad Chhamiruddin, 41 Cal WN 945. In that case, the interpretation of the proviso to Section 23 of the Registration Act was involved. This proviso lays down that a copy of a decree may be presented for registration within four months from "the day on which the decree was made"; and it was held that the words quoted meant the date on which the decree was signed. In the circumstances, though I agree with Sri Lalnarain Sinha that an act of the Sub-Registrar In registering the document presented for its registration beyond thirty days from the date of the decree passed under Section 77 of the Registration Act is without jurisdiction (see: Mirza Mahammad Ismail Beg v. Sricharan Das, ILR 1 Pat 146 : (AIR 1922 Pat 408 (2)), I do not agree with him that the document must be presented for its registration within thirty days of the date of the pronouncement of the judgment in a suit under Section 77; and I hold that in the present case the presentation of the document within thirty days of the date when the decree was signed was quite legal and the document was validly registered.
7. Even assuming, however, for the sake of argument that the document should be presented within thirty days from the date of the judgment, certain facts of the present case show that it was presented in time. Order No. 30, dated the 21st February, 1951 of the order sheet of Title Suit No. 77 shows that the plaintiff filed an application for return of all the documents, Including the mortgage bond in question, and this application was rejected- by the Court. Again, Order 31 dated the 26th February, 1951 shows that the plaintiff fled another application before the Court for return of the mortgage bond at least for presentation before the Sub-Registrar or to send the bond direct to the latter. This time the application was allowed, the document was returned and presented before the Sub-Registrar on the 28th February 1951. The delay in presentation was, therefore, not on account of any laches on the part of the plaintiff, but on account of an act of the Courts and for such an act the plaintiff should not be deprived of the benefit of the decree passed in his favour. This view is supported by a decision of Fazl All, J. (as he then was) in Keshwar Mehra v. Rajeshwari Pershad Singh, AIR 1935 Pat 497, Hence, the contention of Sri Lalnarain Sinha that the mortgage bond in suit was not validly registered must fail.
8. The next argument of Sri Sinha was that a mortgage decree could not be passed in the present case. He did not dispute the finding of the learned Subordinate Judge that the mortgage bond was executed by defendants 1 and 2, who were capable of looking after their affairs during the' relevant period, because the consideration of the bond passed and the loan in question was not applied to any immoral acts of the executants. But he contended that the loan was neither for- any ancestral business of the joint family of the appellants nor for any legal necessity, ft is well settled that the manager of a joint family has no power to impose upon a minor member of his family the risk and liability of a new business started by him, though the minor is bound in respect of the loan taken for an ancestral business (see: Benaras Bank Ltd. v. Hari Marain, AIR 1932 PC 182). There is no evidence to show that in the present case the motor transport business for which the mortgage loan is said to have been taken was an ancestral business. The learned Subordinate Judge is silent on the question whether or not it was an ancestral business, but he has passed a mortgage decree on the finding that it was a family business of the joint family of the appellants and that the loan was advanced for legal necessity.
The learned Advocate-General, who appeared for the plaintiff-respondent, relied on Exhibit 16, an unregistered deed of partnership dated the 3rd April 1934. The plaintiff, as well as the appellants, Nos. 1 and 2, was a party to this document. From paragraph 4, it appears that the parties to this document belonged to a joint family till the 18th October 1933 and carried on from time to time diverse business under different styles and names which are enumerated in that paragraph and one of the items is "Lorry and taxi running business". But all the business apparently broke up on account of the partition. There is no evidence to show that the appellants carried on any transport business thereafter until 1948, that is, for about 15 years, it appears from Exhibit 7, the prospectus and Memorandum of the South Bihar Transport and Trading Company, Limited, that defendants 1 and 2 were the directors of the company. This company owned ten motor vehicles (see Exts. 5 to 5 1 --entries in register of vehicles, read with the evidence of P.W. 5), which were registered in 1948 in the name of the company; but the entries also show that eight of these vehicles were sold to others within a year or so and one vehicle was "under hire-purchase agreement with Srimati Muneshwari Devi, wife of Mahtha Vishun Prasad". It is true that the family of the defendants is a trading family; but this business of transport started in 1948 cannot be connected with the transport business of the joint family consisting of the defendants, the plaintiff and others which broke up in 1933. It is also true that ordinarily even a new business started by a member of a trading family with joint family funds will be deemed to be a family business, because heredity' in business is the touchstone and not necessarily the difference or novelty in the nature of the commercial undertaking; but it is well settled that the new undertaking must not be speculative (See Mulla's Hindu Law, 12th Edition, at page 352). In the present case, however, the new transport business started by defendant No. 1 was speculative Inasmuch as almost all the vehicles had to be sold within a year or so and, according to P.W. 4, the Maharaja of Kunda had to sell his shares worth Rs. 20,000 for Rs. 11,000 to the defendants. Moreover, the defendants were not the sole proprietors of the new company and such a partnership business cannot bind the minor defendant. The learned Subordinate Judge has found that this business was started by defendant No. 1 the grand-father of the minor defendant No. 3 but this fact by itself would not make the business an ancestral business. In Sanyasicharan Mandal v. Krishnadhan Banerji, AIR 1922 PC 237, the Judicial Committee said:
"The distinction between an ancestral business and on a started like the present after the death of the ancestor as a source of partnership relations is patent. In the one case these relations result by operation of law from a succession on the death of an ancestor to an established business, with its benefits and obligations. In the other they rest ultimately in contractual arrangement between the parties."
That was a Dayabhaga case, but the observation applies to a Mitakshara case also. Thus, a business started by a member of the family can be said to be ancestral only when it comes to his descendants after his death. In other words, a business started by a father or grand-father even as 'Karta' of the family does not become an ancestral business so long as the father or grand-father who started it is alive. It must, therefore, be held that the loan in question was taken for a business which was not an ancestral business.
9. The evidence regarding the legal necessity for the loan is also worthless. (After discussion of evidence his Lordship proceeded;) In view of the aforesaid evidence, it must be held that there was no legal necessity for the loan advanced under the mortgage bond in suit. There is another remarkable fact against the plaintiff in the present case in so far as the minor appellant is concerned. The plaintiff has admitted that at the time of the execution of the bond in suit, both the father and the mother of the minor appellant were his guardians. The father, defendant No. 2, did, of course, join the execution of the document. The plaintiff has stated that he did not get the attestation by Sushila, wife of defendant No. 2, on the bond in suit as she was not present at the time of attestation. Sushila Debi was examined on commission; and she has supported the casa of the appellants that there was no legal necessity for the loan and her minor son was not benefited by the same. She has further said that the business in question was not an ancestral one. She as well Debilal had stated that the business was started by Debilal alone and not by the joint family; but Sri Lalnarain Sinha did not press this point and he argued on the assumption that it was a joint family business. In view of the aforesaid evidence, it must be held that there was no legal necessity for the loan In question. '
10. Thus, inasmuch as the mortgage bond in suit was neither for any legal necessity nor for any antecedent debt, the defendants being members of a joint Mitakshara family the mortgage as such is void in its entirety. But this document can be enforced as a simple registered money bond. The finding of the lower Court that the document was duly executed and was for consideration was not challenged in this Court. Hence, the executants of the bond, namely, defendant No. 1 and defendant No. 2, are undoubtedly liable to pay the debt and the only thing is that the plaintiff will be entitled to a money decree only and not to a mortgage decree, As regards the minor defendant No. 3, there is no defence of immorality of the debt. Hence, he is under a pious obligation to pay off the debt of his father (defendant No. 2) and grand-father (defendant No. 1). It is accordingly binding on him also.
11. In the result, the appeal is allowed to this extent only that a money decree, instead of a mortgage decree, will be passed. Subject to this modification, the decree of the lower Court is affirmed. In the circumstances the parties will bear their own costs of the appeal.
12.I agree.