1929 Supreme(SC) 26
Privy Council
Sir Lancelot Sanderson, Tomlin, Justice Shaw, JJ.
Ram Sundar Lal and another -Appellant
Versus
Lachhmi Narain and another -Resopndent
Privy Council Appeal No. 46 of 1928, Allahabad Appeal No. 24 of 1926
Decided On : 15-03-1929
Barrow Rogers and Nevill, T.L. Wilson and Co., W. Wallach
A purchaser of joint family property who acts in good faith and makes due enquiry is not required to repay any surplus consideration to family members if the sale itself was justified by legal necessity.
Headnote:(A) Hindu Law - Alienation of Joint Family Property - Legal Necessity - Where the purchaser acts in good faith and after due enquiry and is able to show that the sale itself was justified by legal necessity, he is under no obligation to enquire into the application of any surplus and is therefore not bound to make repayment of such surplus to the members of the family challenging the sale.
(B) Validity of Sale - Adequacy of Consideration - If a substantial portion of the sale consideration is proved to have been used for legal necessity and the price is not inadequate, the sale cannot be set aside merely because the application of the surplus amount cannot be conclusively proved after a long interval of time.
Facts of the case:
Minor sons of a deceased father filed a suit to recover possession of family property and declare a sale-deed invalid, alleging the sale was executed without legal necessity and that the father had squandered joint family property due to immoral habits. The lower courts found that while a significant portion of the consideration was used to discharge legitimate debts, a balance remained for which legal necessity was not conclusively proved. Consequently, the lower courts passed decrees for partial repayment or possession subject to the payment of the proved debts.
Findings of Court:
The court found that a substantial part of the total sale price was used to pay debts incurred for legal necessity, that due enquiries were made by the purchaser before the sale, and that the consideration received for the property was adequate.
Issues: Whether a sale justified by legal necessity should be set aside or a refund of surplus consideration ordered if the purchaser cannot prove the specific application of the surplus funds.
Ratio Decidendi: The court ruled that if the sale itself is justified by legal necessity and the purchaser acted in good faith after due enquiry, the purchaser is not bound to repay any surplus to the family members. The inability to prove the application of the surplus, particularly after a long period, is not sufficient ground to set aside a sale that was otherwise justified by legal necessity.
Result: Appeal allowed.
Legal Category Hierarchy
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family law
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joint family property
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alienation
- legal necessity
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alienation
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joint family property
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property law
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sale
- validity of sale deed
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sale
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practice and procedure
- appeals
Sir Lancelot Sanderson. -
This is an appeal by the defendants in the suit against a decree of the High Court of Judicature at Allahabad, dated 6th July 1926, whereby a decree of the Subordinate Judge of Ghazipur, dated 7th April 1923, was modified.
The suit was brought on 2nd March, 1922 by the plaintiffs, the minor sons of one Sat Narain Pande, who died in 1915, by their mother, Mt. Narain Kunwar, their certificated guardian, against the defendants, to recover possession of the property specified in the plaint, viz., mauza Kanauli and mauza Sikandra, and for a declaration that a certain sale-deed dated 21st July 1908, purporting to have been executed by Sat Narain Pande, the father of the plaintiffs, in favour of one Misri Lal, the ancestor of the defendants, was invalid.
It was alleged by the plaintiffs that their father was a notorious debauchee and had squandered the joint family property in meeting the expenses of his debauchery and immoral habits; that the above-mentioned sale-deed was executed without any valid necessity and any legal antecedent debt and without any consideration by inserting wrong and fictitious debts and necessities therein.
The defence was to the effect that the property in suit had been sold for legal necessity for the benefit of the family for payment of antecedent debts, and for full consideration.
The learned Subordinate Judge found that, though the father of the plaintiffs was at one time addicted to immoral habits, he had reformed himself long before the transaction which was impeached in the suit and that the sale of the property was made for valid consideration and for the payment of pre-existing debts, except to the extent of Rs. 2,550.
The learned Judge made a decree that the plaintiffs' claim should be dismissed but that the defendants should pay within two months the sum of Rs. 2,550 to the plaintiffs and the third son of Sat Narain Pande, who was not a party to the suit. The plaintiffs appealed to the High Court, and the defendants filed a cross-objection.
The learned Judges, on appeal, agreed with the finding of the learned Subordinate Judge as to the allegations of debauchery on the part of Sat Narain Pande, and held that there was considerable evidence to show that Sat Narain Pande had at one time been addicted to immoral habits, but that he had reformed himself and that about 20 or 22 years before the trial of the suit he had married Mt. Narain Kunwar, the mother of the plaintiffs, with whom he lived amicably until his death in 1915, and by whom he had three sons and a daughter born to him. They further held that there was no satisfactory evidence that at the time the mortgages and the sale referred to in their judgment, were effected he had applied the moneys taken in respect thereof to immoral purposes. There are, therefore, concurrent findings of fact on this part of the case which their Lordships see no reason for disturbing.
The learned Judges examined the evidence relating to the issue as to legal necessity and came to the conclusion that it had been proved that Rs. 7,744-8-0 represented debts due by Sat Narain Pande to third persons for which the plaintiffs were legitimately liable; that the plaintiffs were not liable for the remainder of the consideration specified in the sale-deed, the total of which was Rs. 10,767-7-0.
The learned Judges allowed the appeal, set aside the decree of the learned Subordinate Judge and made a decree in favour of the plaintiffs for possession of the disputed property subject to the payment by the plaintiffs within four months of the sum of Rs. 7,744-8-0. It was further ordered that in case of non-payment of the said money within the time mentioned the suit should stand dismissed. The cross-objection which had been filed by the defendants against the order of the learned Subordinate Judge directing them to pay to the plaintiffs and their brother the sum of Rs. 2,500, was disallowed.
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The defendants appealed against the said decree of the High Co