Karnataka High Court
Ananth Venkatraman Hagde vs Ramachandra Laxman Khod on 17 October, 2022
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RFA No. 780 of 2007
IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
DATED THIS THE 17TH DAY OF OCTOBER, 2022
BEFORE
THE HON'BLE MR JUSTICE R.NATARAJ
REGULAR FIRST APPEAL NO.780 OF 2007 (DEC/INJ)
BETWEEN:
1. ANANTH VENKATRAMAN HEGDE,
DECEASED BY HIS LR'S.
1A. LAKSHMI W/O ANANT HEGDE,
AGED ABOUT 64 YEARS,
OCC: HOUSE-HOLD,
R/O KAKKOD, TQ: SIRSI,
UTTARA KANNADA.
1B. LALITA,
W/O HARIHAR HEGDE,
D/O ANANT HEGDE,
AGED ABOUT 46 YEARS,
R/O BALETOTA, TQ: SIRSI,
UTTARA KANNADA.
1C. DINESH,
S/O ANANT HEGDE,
AGED ABOUT 42 YEARS,
OCC: AGRICULTURE,
R/O KAKKOD, TQ: SIRSI,
UTTARA KANNADA.
2. DINESH ANANTH HEGDE,
AGED ABOUT 65 YEARS,
OCC: AGRICULTURE,
R/O KAKKOD, PO. URTOTA-581401,
TAL SIRSI,
UTTARA KANNADA.
...APPELLANTS
(BY SRI. R.G.HEGDE, ADVOCATE)
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RFA No. 780 of 2007
AND:
1. RAMACHANDRA LAXMAN KHOD,
MAJOR, OCC: MERCHANT,
SEHSHADRI ROAD,
BANGALORE SIRSI,
KASABA, NITYANAND MATH ROAD,
SIRSI, U.K. DISTRICT-581401.
2. SMT.VINODA SUBRAY HEGDE,
AGED ABOUT 49 YEAS,
OCC: HOUSEHOLD,
R/O SIRSI, KASABA BANDHI CHAWL
NEAR T.S.S. RICE MILL,
SIRSI, UTARA KANANDA-581402.
3. SHIVARAM VENKATRAMAN HEGDE,
AGED ABOUT 67 YEARS, RYOT,
R/AT KAKKOD, TQ: SIRSI,
PO: URATPTA,
TQ: SIRSI-581401,
UTTARA KANNADA.
...RESPON0DENTS
(BY SRI. SANGRAM S.KULKARNI, ADVOCATE FOR
SRI. V.P.KULKARNI, ADVOCATE FOR R1;
R2 AND R3 ARE SERVED)
THIS REGULAR FIRST APPEAL IS FILED UNDER SECTION
96 OF C.P.C., AGAINST THE JUDGEMENT AND DECREE DATED
02.12.2006 PASSED IN O.S.NO.14/1996 ON THE FILE OF THE
CIVIL JUDGE (SR.DN.) SIRSI, DISMISSING THE SUIT FOR
DECLARATION AND INJUNCTION.
THIS APPEAL COMING ON FOR FINAL HEARING THIS
DAY, THE COURT DELIVERED THE FOLLOWING:
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RFA No. 780 of 2007
JUDGMENT
The unsuccessful plaintiffs in O.S.No.14/1996 on the file of the Civil Judge (Sr.Dn.), Sirsi have filed this Regular First Appeal challenging the judgment and decree dated 02.12.2006 passed therein.
2. The plaintiffs filed the suit for declaration that the sale deeds dated 26.09.1989 and 31.12.1992 executed by the 2nd defendant were illegal and does not affect their rights under the partition of the year 1966 and to restrain defendants No.1 and 2 from alienating the suit properties. Plaintiff No.2 is the son of plaintiff No.1. The plaintiff No.1 contended that defendant No.2 was his brother's wife, while defendant No.3 was his brother. The plaintiffs claimed that in the year 1966, the parties had partitioned the properties of the family and had agreed not to sell their portions to third parties without first offering to either of them. The plaintiffs claimed that the husband of defendant No.2 died somewhere in the year 1984-1985 and she succeeded to his estate. The plaintiffs claimed that the 2nd defendant created a collusive and make believe sale deed dated 31.12.1992 and 26.09.1989 in favour of Shri Mahabalanand Swamiji which came to the knowledge of -4- RFA No. 780 of 2007 plaintiffs on 14.07.1995. The plaintiffs contended that defendant No.2 was bound by the recitals contained in the partition deed of the year 1966 and therefore, the sale deeds executed by her were not binding upon the plaintiffs. They also alleged that there was no need for defendant No.2 to encumber the suit 'A' and 'B' schedule properties. Hence, the suit was filed for the reliefs mentioned above.
3. The suit was contested by defendant No.1 who filed his written statement contending that the agreement between the parties in the partition of the year 1966 was illegal. Defendant No.1 admitted the fact that the husband of defendant No.2 had expired in the year 1984-1985 and that in order to meet the legal expenses of her children, defendant No.2 had encumbered the suit properties. He admitted that the suit schedule 'B' property was subject to the provisions of the Karnataka Land Reforms Act. Defendant No.1 denied the averments of the plaint and contended that the sale deeds were not concocted, but were lawfully executed by defendant No.2 for valid consideration. It was also contended that the suit was highly belated as it was filed in the year 1996. It was also contended that the plaintiffs did not seek enforcement of their -5- RFA No. 780 of 2007 alleged right of pre-emption and therefore, the suit under the present form was not maintainable.
4. Defendant No.3 supported the case of the plaintiffs by contending that the 'A' schedule properties was not clearly bifurcated. He also contended that there was a pre-emption clause in the partition which prohibited the parties from alienating their respective shares to strangers, but had to be conveyed amongst themselves at the price fixed by panchayat of the village. He also contended that any transaction made in violation of this condition was illegal. He also contended that even if the sale of the suit properties by defendant No.2 in favour of defendant No.1 was for legal necessity, since such sale was against the conditions stipulated in the partition, the sale deeds were illegal. He contended that he was willing to purchase the suit properties.
5. Based on the rival contentions, the trial Court framed the following issues:
(1) 2£Éà ¥ÀæwªÁ¢AiÀÄÄ ªÀiÁrzÉÝA§ zÁªÁ 'C' ¥Àj²µÀÖ D¹ÛUÀ¼À PÀÄjvÀÄ DzÀ ¢£ÁAPÀ: 26.09.1989gÀ zÀ¸ÄÀ Û ªÀÄvÀÄÛ ¢£ÁAPÀ: 31.12.1992 gÀAzÀÄ DzÀ zÁªÁ '©' ¥Àj²µÀÖ D¹ÛUÀ¼À PÀÄjvÀÄ DzÀ zÀ¸ÛÀ EªÀÅUÀ¼ÄÀ -6- RFA No. 780 of 2007 ¨ÉÃPÁ¬ÄݲÃgÀ EzÀÄÝ CªÀÅ vÀªÄÀ ä ºÀQÌUÉ ¨Á¢¸À¯ÁgÀzÉAzÀÄ ªÁ¢UÀ¼ÀÄ gÀÄdĪÁvÀÄ¥Àr¹gÀĪÀgÉÃ?
(2) ¥ÀæwªÁ¢UÀ¼ÀÄ ªÁ¢UÀ½UÉ vÉÆAzÀgÉ CxÀªÁ DvÀAPÀ ¥Àr¹zÁÝgÉAzÀÄ ªÁ¢UÀ¼ÀÄ gÀÄdĪÁvÀÄ¥Àr¹gÀĪÀgÉÃ?
(3) zÁªÁzÀ°è PÉÆÃjzÀ ¥ÀjºÁgÀUÀ¼À£ÄÀ ß ºÉÆAzÀ®Ä ªÁ¢UÀ¼ÄÀ CºÀðjzÁÝgÉAiÉÄÃ?
(4) K£ÀÄ DYÉÕ? K£ÀÄ rQæ?
6. Plaintiff No.2 was examined as PW1 and he marked Exs.P1 to P9, while the power of attorney of defendant No.1 was examined as DW1 who marked Exs.D1 to D4. Based on the oral and documentary evidence, the trial Court dismissed the suit on the following grounds.
(i) Under Section 22 of the Hindu Succession Act, the right of pre-emption is only available amongst Class-I heirs, while in the present case, defendant No.2 was not the Class-I legal heir along with plaintiffs and defendant No.3.
(ii) That the sale deeds by defendant No.2 in favour of Sri Mahabalanand Swamiji was executed in the year 1989 and 1992 while the suit was filed in the year 1996 and -7- RFA No. 780 of 2007 therefore, it is barred under Article 97 of the Limitation Act.
(iii) That Section 22 of the Hindu Succession Act, operates in a different situation when a composite property devolves upon legal heirs in Class-I, while in the present case, they were all severed members of an erstwhile joint family. In the present case, the properties were already partitioned between the plaintiffs, father-in-law of defendant No.2 and the defendant No.3.
Therefore, between the plaintiffs and defendant No.2, Section 22 of the Hindu Succession Act, ('the Act' for brevity) was inapplicable.
7. Being aggrieved by the said judgment and decree, the plaintiffs have filed this Regular First Appeal.
8. The learned counsel for the plaintiffs submitted that Section 22 of the Act, creates a statutory right in favour of persons who own property jointly and they have a preferential right to purchase the share of the other sharer at the rate that may be fixed by the Court. He submitted in the case on hand, though the plaintiffs, husband of defendant No.2 and the defendant No.3 were privy to the partition in the year 1966 -8- RFA No. 780 of 2007 which mandated that, if any of the parties desired to sell their share, it should be first offered to the other heirs and therefore, the defendant No.2 could not have sold the suit properties without offering it to the plaintiffs or the defendant No.3. He contended that this was an agreement created by the parties and therefore, they were bound to follow the same. He further submitted that any deviation from the said agreement entitled the parties to sue for cancellation of the sale deeds. The learned counsel further submitted that the purpose of Section 22 of the Act is to ensure that the properties are held by the family and no stranger is allowed to enter a property held jointly.
9. On the other hand, learned counsel for respondent No.1 submitted that the case of the plaintiffs is based merely on an agreement found in the partition in the year 1966 and that agreement was never effected to during the lifetime of the husband of defendant No.2. He submitted that after the death of husband of defendant No.2, she and her children were no longer Class I legal heirs along with the plaintiffs and therefore, were not bound by the agreement. In this regard, he relied upon the judgment of a co-ordinate bench of this Court in -9- RFA No. 780 of 2007 GANESHAPPA AND OTHERS VS. KRISHNAMMA AND OTHERS reported in ILR 2005 KAR 358. Even otherwise, they contend that Section 22 of the Act did not create an absolute bar against alienation but only gave a preferential right to the sharers to purchase the property. He submits that since the defendant No.2 and her legal heirs are not Class I heirs, the plaintiffs cannot invoke Section 22 of the Act. Alternatively, he contended that if the plaintiffs were not invoking Section 22 of the Act, but were basing their claim on the partition in the year 1966, such an agreement which acted as a restraint against the defendant No.2 exercising her rights of ownership, is to be held illegal and inoperative. He also contended that the suit is filed in the year 1996 to annul the sale deeds of the year 1989 and 1992 and therefore, under Article 97 of the Limitation Act, the suit is clearly barred by law of limitation.
10. I have bestowed my anxious consideration to the arguments advanced by the learned counsel for the parties.
11. The points that arise for consideration in this appeal are:
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"i) Whether the agreement set up by the plaintiffs is referrable to Section 22 of the Hindu Succession Act or is it a stand alone agreement entered into between the parties and whether such an agreement is enforceable in the eye of law?
ii) Whether the suit filed by the plaintiffs was within the time prescribed under Article 97 of the Limitation Act?
12. The plaintiffs have claimed that at a partition in the year 1966, entered into between i) Shivarama Venkatramana Hegde, ii) Venkatramana Hegde and iii) Subraya Kamalakar Hegde, the three of them had agreed as follows:
" ¸À¢æ »¸ÉUÉ ¸ÀªÀÄäAzsÀ ¥ÀlÖ D¹ÛUÀ¼ÀÄ £ÀªÀÄä ¦vÁæfðvÀ«zÀÄÝ £ÀªÀÄä £ÀªÀÄä »¸ÉUÉ §AzÀ D¹ÛAiÀÄ£ÀÄß £ÀªÀÄä ¥ÉÊQ AiÀiÁgÁzÀgÀÆ AiÀiÁªÀzÉà vÀgÀ¢AzÀ ¥ÀgÁ¢üãÀªÀiÁqÀĪÀ¢zÀÝgÉ £ÀªÀÄä ¥ÉÊQAiÀįÉèà ªÀiÁqÀ¨ÉÃPÉà «£ÁB ¨ÉÃgÉAiÀĪÀjUÉ ªÀiÁqÀvÀPÀÌzÀݯÁè ªÀ ºÁUÉ ªÀiÁrzÀgÉ CzsÀÄ ¹AzsÀÄ «gÀĪÀ¢¯Áè."
13. Amongst the three persons referred above, Subraya Kamalakar Hegde is the husband of the defendant No.2 and he represented the branch of his father who had by then expired. Later, the husband of the defendant No.2 died during 1984-85 and the property that fell to the share of husband of defendant No.2 was succeeded by defendant No.2 and her children. The
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RFA No. 780 of 2007 defendant No.2 thereafter sold the 'A' and 'B' schedule properties to Shri Mahabalanand Swamiji in terms of two different sale deeds in the year 1989 and 1992. Long thereafter on 14.07.1995, the plaintiffs allegedly came to know of the sale deeds and hence, filed a suit to declare the two sale deeds as illegal and not binding upon their right created under the partition of the year 1966. The agreement entered into between the parties at that point of time was for the sake of convenience and for the sake of easy and better enjoyment of the suit properties so that, third parties did not enter into possession of the properties of the family. After the death of the husband of the defendant No.2, the defendant No.2 and her children had succeeded to the properties and this is evident from the cross-examination of PW-1 where he deposed as follows:
"1966£Éà E¹éAiÀÄ°è £ÀªÀÄä PÀÄlÄA§zÀ°è DVvÀÄÛ JAvÁ ¥Á®Ä ¥ÀnÖAiÀÄ°è ªÉÄÃ¯É ºÉýzÀ 7 d£À £À£Àß CdÓ£À ªÀÄPÀ̼ÀÄ ¥ÀPÀëUÁgÀ®®è. ¸À¢æ ¥Á®Ä¥nÖAiÀÄ°è PÀªÀįÁPÀgÀ, C£ÀAvÀ ªÀÄvÀÄÛ ²ªÀgÁªÀÄ ¥ÀPÀëUÁgÀgÁVzÀÝgÀÄ. 1966£Éà E¹é ¥ÀƪÀðzÀ°è £ÀªÀÄä CdÓ£À PÀÄlÄA§zÀ D¹ÛAiÀÄ°è ¥Á®Ä DVvÀÄ.Û ªÉÄÃ¯É ºÉýzÀ PÀªÀi¯ÁPÀgÀ, C£ÀAvÀ ²ªÀgÁA ºÉUÉØAiÀĪÀjUÉ ¥ÀævÉåÃPÀªÁV ¥Á®Ä PÉÆqÀ¯ÁVvÀÄ.Û
- 12 -RFA No. 780 of 2007
ºÁUÉà ¥ÀævÉåÃPÀªÁV PÉÆlÖ D¹ÛAiÀÄ°è ªÀÄvÉÆÛªÉÄä 66 gÀ°è ¥Á®Ä PÉÆqÀ¯ÁVvÀÄ.Û 1966£Éà E¹éAiÀÄ°è ªÉÄÃ¯É ºÉýzÀAvÉ ¥Á®Ä DzÀ ¸ÀªÀÄAiÀÄzÀ°è PÀªÀįÁPÀgÀ fêÀAvÀ EgÀ°®è.
ªÉÄÃ¯É ºÉýzÀ PÀªÀi¯ÁPÀgÀ¤UÉ ¸ÀĨÁæAiÀÄ C£ÀÄߪÀªÀ£Éà M§â£ÀÄ ªÀÄUÀ EzÀÝ£ÀÄ. ¸À¢æ ¸ÀĨÁæAiÀÄ CAzÁdÄ 15 ªÀµÀðzÀ »AzÉ wÃjPÉÆArzÁÝ£É. ªÁådåzÀ D¹ÛUÀ¼ÀÄ ªÀÄÈvÀ ¸ÀĨÁæAiÀÄ PÀªÀįÁPÀgÀ ºÉUÉØUÉ ¸ÀªÀÄäAzÀ¥ÀlÖ D¹ÛUÀ¼ÁVªÉ J£ÀÄߪÀzÀÄ ¸Àj EzÉ. ¸ÀĨÁæAiÀÄ PÀªÀįÁPÀgÀ ºÉUÉØ wÃjPÉƼÀÄîªÀ ¸ÀªÀÄAiÀÄzÀ°è CªÀ¤UÉ ºÉAqÀw ªÀÄvÀÄÛ ªÀÄPÀ̼ÀÄ EzÀÝgÀÄ. ¸À¢æ ¸ÀĨÁæAiÀÄ PÀªÀįÁPÀgÀ ºÉUÉqÀØAiÀÄ ºÉAqÀwAiÀÄÄ F ªÁådåzÀ 2£Éà ¥ÀæwªÁ¢AiÀiÁVzÁݼÉ."
14. It is relevant to note that the father-in-law of defendant No.2 was not alive as on the date of the partition in the year 1966. The agreement entered into between husband of defendant No.2, the plaintiff No.1 and defendant No.3 were personal in nature and bound only them and not their legal representatives. This agreement did not correspond to a pre-emption agreement as provided under Section 22 of the Act. Section 22 of the Act is reproduced herein below:
"22. Preferential right to acquire property in certain cases.--
(1) Where the commencement of this Act, an interest in any immovable property of an intestate, or in any business carried
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on by him or her, whether solely or in conjunction with others, devolves upon two or more heirs specified in class I of the Schedule, and any one of such heirs proposes to transfer his or her interest in the property or business, the other heirs shall have a preferential right to acquire the interest proposed to be transferred.
(2) The consideration for which any interest in the property of the deceased may be transferred under this section shall, in the absence of any agreement between the parties, be determined by the court on application being made to it in this behalf, and if any person proposing to acquire the interest is not willing to acquire it for the consideration so determined, such person shall be liable to pay all costs of incident to the application.
(3) If there are two or more heirs specified in class I of the Schedule proposing to acquire any interest under this section, that heir who offers the highest consideration for the transfer shall be preferred."
15. A bare perusal of Section 22 of the Act indicates that it applies when a property of an intestate male or female devolves upon two or more heirs specified in Class I of the Schedule and if any one of such heirs proposes to transfer his or her interest in the property, the other heirs would have a preferential right to acquire interest proposed to be transferred, subject to conditions specified in sub-section (2) and (3) and within the time prescribed under Article 97 of the Limitation Act. In the case on hand, the properties belonging to the joint
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RFA No. 780 of 2007 family comprised of plaintiff No.1, deceased father-in-law of defendant No.2 and defendant No.3 were divided amongst the plaintiff No.1, husband of defendant No.2 and defendant No.3 in terms of the partition deed dated 24.11.1966. The agreement entered into between them creating a right of pre- emption, therefore did not correspond to a statutory right recognized under Section 22 of the Act.
16. Further, the plaintiffs and defendant No.2 are not heirs belonging to Class I of the Schedule to the Act. When the partition deed was executed in the year 1966, it was the husband of defendant No.2 who was privy to the agreement that he would first offer the property to the other heirs in the event he desired to sell it. Therefore, such a contemplation in the agreement bound only the plaintiffs, the husband of defendant No.2 and the defendant No.3 and not defendant No.2 and her legal heirs. Therefore, the plaintiffs are not entitled to seek enforcement of the agreement. Even otherwise, the plaintiffs did not make any efforts to seek determination by applying to the Court to decide the consideration payable but he waited for more than 7 years and 4 years respectively to
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RFA No. 780 of 2007 challenge the sale deed executed by the defendant No.2 in the year 1989 and 1992.
17. Article 97 of the Limitation Act deals with the limitation applicable for enforcing the right of preemption and the same is extracted below:
To enforce a right of pre-emption When the purchaser Article whether the right is founded on One year takes under the sale 97 law or general usage or on special sought to be contract impeached, physical possession of the whole or part of the property sold, or, whether the subject matter of the sale does not admit of physical possession of the whole or part of the property, when the instrument of sale is registered.
18. PW-1 admitted in his evidence that Shri Mahabalanand Swamiji was the owner of the suit property having purchased it in terms of the sale deed in the years 1989-1992. Therefore, he cannot feign ignorance of the sale deeds and cannot maintain the suit on the ground that he came to know about the sale deed in the year 1995. Once the limitation prescribed under the Limitation Act, expired, the plaintiffs could not seek extension of time to file the suit by contending that they came to know about the transaction only in the year 1995.
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RFA No. 780 of 2007
19. The Hon'ble Apex Court in the case of TILAK RAJ BAKSHI VS. AVINASH CHAND SHARMA reported in [2020 (15) SCC 605], summarized the whole gamut of case law relating to the right of preemption.
20. In BISHAN SINGH VS. KHAZAN SINGH reported in AIR 1958 SC 838, the Hon'ble Apex Court held as under:
7. Before attempting to give a satisfactory answer to the question raised, it would be convenient at the outset to notice and define the material incidents of the right of pre-emption. A concise but lucid statement of the law is given by Plowden, J. in Dhani Nath vs. Budhu (136 PR 1894), at page 511, thus:
"A preferential right to acquire land, belonging to another person upon the occasion of a transfer by the latter, does not appear to me to be either a right to or a right in that land. It is jus ad rem alienum acquirendum and not a jus in re aliena.... A right to the offer of a thing about to be sold is not identical with a right to the thing itself, and that is the primary right of the pre-emptor. The secondary right is to follow the thing sold, when sold without the proper offer to the pre- emptor, and to acquire it, if he thinks fit, in spite of the sale, made in disregard of his preferential right."
The aforesaid passage indicates that a pre-emptor has two rights: (1) inherent or primary right i.e. a right for the offer of a thing about to be sold and (2) secondary or remedial right to follow the thing sold."
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RFA No. 780 of 2007
21. Later in the case of K.NAINA MOHAMED VS.
A.M.VASUDEVAN CHETTIAR reported in [(2010) 7 SCC 603], the Hon'ble Apex Court has held as follows:
" 38. Reverting to the case in hand, we find that by executing the will dated 22-9-1951, Smt Ramakkal Ammal created life interest in favour of her two sisters with a stipulation that after their death, their male heirs will acquire absolute right in A and B properties respectively subject to the condition that if either of them want to sell the property then they shall have to sell it to the other sharers only as per the prevailing market value and not to strangers. The restriction contained in Clause (11) was not absolute inasmuch as alienation was permitted among male heirs of the two sisters. The object of incorporating this restriction was to ensure that the property does not go out of the families of the two sisters. The male heirs of Savithri Ammal and Rukmani Ammal did not question the conditional conferment upon them of title of the properties. Therefore, the appellant who purchased B property in violation of the aforesaid condition cannot be heard to say that the restriction contained in Clause (11) of the will should be treated as void because it violates the rule against perpetuity."
22. Having regard to the above, though the plaintiffs and defendant No.3 had a right to seek for preemption during the lifetime of the husband of defendant No.2, they could claim that this agreement continued to bind the defendant No.2 and her children. Even otherwise, such claim ought to have been
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RFA No. 780 of 2007 made within the time prescribed under Article 97 of the Limitation Act which unfortunately is not done. Therefore, the plaintiffs are not entitled for the relief in the suit. Hence, the points for consideration framed by this Court is answered as follows:
23. The plaintiffs had lost the right to enforce the agreement contained in the partition dated 24.11.1966 (Ex.P.9) after the death of the husband of defendant No.2. The agreement entered into between the plaintiffs, husband of defendant No.2 and the defendant No.3 did not fit into a statutory right under Section 22 of the Act, as the parties had already divided the properties. Notwithstanding the above, the plaintiffs ought to have filed a suit for cancellation of the sale deeds or for enforcing the right of preemption by filing a suit within the time prescribed under Article 97 of the Limitation Act.
24. Hence, this appeal fails and the same is dismissed.
SD/-
JUDGE CLK-paragraphs 1 to 5;
Jm-from paragraph 6 till end