1962 Supreme(AP) 177
Andhra Pradesh High Court
Judges : UMAMAHESWARAM, VENKATESAM
Bhupatiraju Sreeramaraju - Appellant
Versus
Nadimpalli Pullam Raju - Respondent
Decided On : 10-15-62
The sons are liable under the doctrine of pious obligation for the debts contracted by the father in a new business started by him, unless the debts are avyavaharika debts.
Headnote:
PARTITION - HINDU LAW - NEW BUSINESS STARTED BY FATHER - LIABILITY OF SONS - DOCTRINE OF PIOUS OBLIGATION - AVYAVAHARIKA DEBTS - COMMERCIAL DEBTS - ALIENATION OF FAMILY PROPERTIES - VALIDITY.
Fact of the Case:
The plaintiff, a minor represented by his maternal uncle as guardian, filed a suit for partition and separate possession of one-fourth share in the family properties. The defendants contended that the properties were sold for antecedent debts and were binding on the plaintiff. The Subordinate Judge held that the debts were avyavaharika and the alienations were not binding on the plaintiff.
Finding of the Court:
The High Court held that the business started by the father was not a new business and the sons were liable under the doctrine of pious obligation. The debts contracted for the rice mill business were not avyavaharika debts and the alienations of B schedule properties as also the Court auction purchases of A schedule properties were valid and binding upon the minor.
Issues: 1. Whether the business started by the father was a new business within the meaning of Sanyasi Charan v. Krishnadhan Banerji and Benares Bank Ltd. v. Hari Narain? 2. Whether the debts contracted for the rice mill business were avyavaharika debts? 3. Whether the alienations of B schedule properties were valid?
Ratio Decidendi: 1. The High Court held that the business started by the father was not a new business as it was started when he was the sole surviving coparcener and the sons were born after the commencement of the business. The High Court followed the view taken by the Madras and Allahabad High Courts in Canara Banking Corporation Ltd. v. South Indian Bank Ltd. and Angney Lal Narain Das v. Angney Lal Munnilal, respectively. 2. The High Court held that commercial debts incurred by the father are not avyavaharika debts, following the decisions in Atchutam v. Ratnajee and Venkateswara Rao v. Ammayya. The High Court also held that the mere fact that the father entered into a partnership with three others and contracted the debts sought to be attacked as avyavaharika debts makes no difference. 3. The High Court held that the alienations of B schedule properties were valid as they were executed for the discharge of antecedent debts, following the decision of the Privy Council in Brij Narain v. Mangala Prasad.
Final Decision: The High Court set aside the judgment of the Subordinate Judge and restored the judgment of the Subordinate Judge. The appellants were entitled to their costs throughout.
( 2 ) SRI Gangadhararao, the learned Advocate for the Appellants, raised a new legal contention based on the admitted facts viz. , that the rice mill business started by the father in 1946 was not a new business. He also urged that if the business was a new business even then the sons are liable under the doctrine of pious obligation and that the view taken by the learned Judge that the debts are avyavaharika was erroneous. Having carefully heard the arguments of Sri Gangadhararao as also of Sri. Chandramouli on behalf of the respondent, we are satisfied that both the contentions should prevail