1996(4) Supreme 356
SUPREME COURT OF INDIA
A.M. Ahmadi, C.J.I., Sujata V. Manohar and K. Venkataswami, JJ.
Gangadharan -Appellant
versus
Janardhana Mallan & Ors. -Respondents
Civil Appeal No. 5281 of 1983
Decided on 10-5-1996
Held : Substantial portion having gone into the discharge of antecedent debts and enquiries made by the purchaser regarding legal necessity coupled with the fact that the alienation was challenged after 12 years from the date of alienation, we find no difficulty in coming to the conclusion that the High Court went wrong in upsetting the judgments of the Trial Court as well as the First Appellate Court. Even though the judgments of the Privy Council and of this Court were brought to the notice of High Court, it unfortunately, failed to give due consideration to the ratio laid down in those cases. (Para 11)
The purchasers have done their best to prove the legal necessity and substantial portion of the sale consideration went into the discharge of the antecedent debts. The First Appellate Court has given a clear finding on this. Having regard to the long lapse of time when the suit was instituted, challenging the alienation, nothing more could be expected from the purchasers to prove the legal necessity and the application of sale consideration. (Para 12)
JUDGMENT
K. Venkataswami J.-Aggrieved by the judgment of the High Court of Kerala at Ernakulam in Second Appeal No.751/77 dated 19.7.77, this appeal by special leave has been preferred by the first defendant in the said suit, namely O.S. No. 27/67 on the file of Subordinate Court, Irinjalakuda. The said suit was filed by the respondent Nos. 1-5 along with one Ramanathan who died pending appeal before the District Court for partition and separate possession of their 6/8 share in this property, namely, 66 cents with building thereon in Kodungallur (Kerala). The appellant (first defendant) was the purchaser of the suit property from the father of the plaintiffs (respondent nos. 1-5) under sale deed dated 2.4.55 (Ex.P2). The property sold under Ex. P2 was one of the items of the joint family property. When the sale took place, the plaintiffs were minors. After the death of the father and after 12 years of the sale in question the present suit was filed attacking the validity and binding nature of the sale on the ground that the sale was for a grossly inadequate consideration; that there was no pressing need to alienate the property; that the income from other properties of the joint family was sufficient to wipe off the debts if any and that most of the debts for the discharge of which Ex. P2 was executed were bogus in nature. The sale consideration was for a sum of Rs. 9,000/-.
2. The first respondent (appellant herein) resisted the suit by contending that the suit was speculative one, the vendors were obliged to alienate comparatively a small fraction of the family property for the purpose of carrying on the business; that the income from other family properties were not sufficient for discharging the liabilities and that the sale was for adequate consideration.
3. The trial court after elaborate consideration found that out of sale consideration of Rs. 9,000/- a sum of Rs. 5,750/- factually was utilised to discharge genuine antecedent debts and the sale consideration was adequate. Consequently, the trial court upheld the validity of Ex. P2 sale deed and dismissed the suit.
4. The plaintiffs (respondent nos. 1-5) preferred appeal to the District Court and the learned District Judge also concurred with the findings of the trial court and dismissed the appeal.
5. The plaintiffs preferred a second appeal to the High Court and the learned Single Judge found that out of sale consideration of Rs. 9,000/-, a sum of Rs. 1,250/-, being part of the sale consideration cannot be treated as a debt as the said amount was left with the vendee to pay the future instalment of Kuri subscription. In view of that, the High Court held as follows :
"If as in this case half of the consideration is to discharge a debt which is an antecedent debt and half is not it could not be said that the alienation was to discharge antecedent debt. No doubt the discharge of antecedent debt was also involved in such alienation. Therefore, it cannot be said that in this case the alienation was effected to pay off antecedent debt of the father and as such the alienation is supportable."
6. On the question whether there was pressing necessity for the sale of an item of the joint family property, the High Court remanded the case.
7. Aggrieved by the judgment of the High Court, this appeal has been filed. Learned Sr. Counsel appearing for the appellant submitted that the High Court erred in holding that only half of the sale consideration was utilised to discharge antecedent debt and therefore, the alienation cannot be supported. According to the learned Sr. Counsel if the vendee makes genuine enquiry about the necessity for the sale of the property before the purchase and pays adequate consideration thereafter it was not necessary for him to see the application of the money. In this case, according to the learned Sr. Counsel, the learned District Judge has found that the vendee (appellant herein) has made genuine enquiries and satisfied himself regarding
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