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HIGH COURT OF BOMBAY
BHAGWATI, VYAS, JJ.
Ramabai Govind
Versus
Raghunath Vasudeo
Letters Patent Appeal No. 38 of 1950, from decision of Chainani, J., in Cross S. A. Nos. 608 and 1110 of 1948.
Decided On : 12-07-1951
The plaintiff, as the legatee under Govind's will, filed a suit to recover her half share in the suit property, which was purchased by Martand, the trustee of Govind's estate, in his own name in 1907 and sold to the defendant in 1933. The defendant claimed that he was a bona fide purchaser for value without notice and was protected under S. 64, Trusts Act. The trial court dismissed the plaintiff's suit, but the lower appellate court reversed the decision and decreed the suit. The defendant appealed to the High Court, and the plaintiff filed a cross-appeal challenging the lower appellate court's decision on mesne profits.
Fact of the Case:
Govind, under the terms of his will, appointed Trimbak, Khare, and Joshi as his executors. Trimbak continued to manage the properties, movable and immovable, which had been the subject matter of the partition, as before. After Trimbak's death, his sons Martand and Janardan entered into possession of all the properties and managed them as a single unit without any division made in regard to the share of Govind therein. In the year 1907 Martand purchased the suit property in his own name by a conveyance dated 17-4-1907. There were disputes between Martand and Janardan, which were referred to arbitration, and ultimately in 1915 an award decree was passed. As a result of the award made by the arbitrators, a partition was effected between Martand and Janardan. It is necessary to observe at this stage that the suit house which had been purchased by Martand in his own name in 1907 was declared to belong to Martand alone under the terms of this award decree. In 1934, Martand sold the suit property to Raghunath Vasudeo Joshi, the defendant. Ramabai, Govind's widow, died leaving her surviving her three daughters. Trimbak, who was the preferential executor if he may be so styled, and he continued to act as the executor and managed the estate of Govind whioh was the subject-matter of the will during his lifetime. After the death of Trimbak, however, neither Khare nor Joshi took it to be any part of his obligation to take charge of and manage the estate of Govind, and Martand and Janardan, the sons of Trimbak, continued to manage all the properties, movable and immovable, which were the subject matter of the partition, including Govinds share therein as before.
Finding of the Court:
The High Court held that Martand, as a trustee of Govind's estate, had mixed up the trust properties with his own, and the onus of proving that the suit property was purchased from the mixed fund was on the defendant, who derived his title from Martand. The Court further held that the question of whether the defendant was a bona fide transferee for value without notice was a question of fact, and the lower appellate court's finding that the defendant was not a bona fide purchaser was conclusive. The Court also rejected the defendant's contention that the plaintiff's suit was barred by limitation.
Issues: 1. Whether Martand, as a trustee of Govind's estate, had mixed up the trust properties with his own? 2. Whether the onus of proving that the suit property was purchased from the mixed fund was on the defendant? 3. Whether the question of whether the defendant was a bona fide transferee for value without notice was a question of fact? 4. Whether the lower appellate court's finding that the defendant was not a bona fide purchaser was conclusive? 5. Whether the defendant's contention that the plaintiff's suit was barred by limitation was valid?
Ratio Decidendi: 1. The Court held that Martand, as a trustee of Govind's estate, had mixed up the trust properties with his own, based on the following reasoning: - Martand managed all the properties, including Govind's share, as a single unit. - There was no demarcation or separation of Govind's share from the rest of the properties. - Martand did not produce any accounts to show that the two estates were not confounded. - The presumption in law, as laid down in Lewin on Trusts and Tulasamma v. Venkatasubbayya, was that the property purchased by Martand was acquired from the blended or mixed fund. 2. The Court held that the onus of proving that the suit property was purchased from the mixed fund was on the defendant, based on the following reasoning: - Martand, as a trustee, had a duty to keep the trust property separate from his own. - Martand failed to discharge this duty by mixing up the trust properties with his own. - The defendant, who derived his title from Martand, was bound to prove that the suit property was acquired from Martand's self-acquisitions. 3. The Court held that the question of whether the defendant was a bona fide transferee for value without notice was a question of fact, based on the following reasoning: - The question of bona fides is a question of fact. - The lower appellate court had recorded a definite finding that the defendant was not a bona fide transferee for value without notice. - This finding was conclusive and could not be challenged in second appeal. 4. The Court held that the lower appellate court's finding that the defendant was not a bona fide purchaser was conclusive, based on the following reasoning: - The finding was a finding of fact. - The defendant did not raise the issue of bona fide purchase in the second appeal before Chainani, J. - Even if the issue had been raised, it would have been a question of fact and the finding of the lower appellate court would have been conclusive. 5. The Court rejected the defendant's contention that the plaintiff's suit was barred by limitation, based on the following reasoning: - The suit was filed within the limitation period prescribed under Art. 134 or Art. 144 of the Limitation Act. - Art. 120 of the Limitation Act, which provides a residual period of limitation for suits not otherwise provided for, did not apply in this case.
Final Decision: The High Court allowed the plaintiff's appeal, dismissed the defendant's appeal, and restored the judgment of the lower appellate court. The plaintiff's suit was decreed as ordered by the lower appellate court, and the defendant was ordered to pay the plaintiff's costs and bear his own costs.
Bhagwati, J. :- This is a Letters Patent appeal from a judgment of Chainani, J., delivered in second Appeals No. 608 of 1948 and 1110 of 1948 against the judgment of the lower appellate Court constituted by the learned Judge, Small Cause Court, Poona, (with appellate powers), who allowed the appeal against the decision of the learned Extra
Joint Civil Judge, Poona, dismissing the plaintiffs suit with costs. The facts which led to the filing of the suit may be shortly stated as under.
2. One Mahadev Gadre, had two sons Balkrishna and Govind. Balkrishna was the elder son, but he was spiritually inclined and almost renounced this world. He had a son Trimbak alias Bapurao, and Trimbak had two sons, Martand and Janardan. Govind was a pleader. The joint family of Mahadev Gadre, Balkrishna and Govind flourished and owned large movable and immovable properties. They also carried on a money-lending business in which large capital was invested. After the death of Mahadev Gadre, both the brothers Balkrishna and Govind continued to remain joint, but towards June-July 1894 Govind, after he returned from pilgrimage to Benares, wanted to give effect to the desire which he had entertained while at Benares to become separate from his brother Balkrishna. Govind was ailing and had not much expectation of life. He had married Ramabai but had no male issue by her. He therefore wanted to effectuate his desire to become separate from his brother Balkrishna and, having talked about the matter to Balkrishna who referred him to his son Trimbak and having further obtained the consent of Trimbak, came to a partition of the joint family properties. The two branches separated after mutual consent. The whole of the movable and immovable properties and the debts and outstandings in respect of the money-lending business were divided into two equal shares and one share was taken by Govind and the other was taken by Trimbak and in this way a general division was effected, and each one became the owner of his respective half share. Govind having no male issue, desired to effect a vyavasthapatra or will in regard to the half share of the joint family properties which came to him, and he accordingly on 30th July 1894, executed a vyavasthapatra appointing as the vyavasthapaks or executors Trimbak Balkrishna, his nephew, and, after him, two other individuals Purushottam Parshuram Khare and Ramchandra Vishnu Joshi. Govind had great confidence in Trimbak. It was not possible there and then to divide the properties by metes and bounds. In fact Trimbak himself requested that the property should not then be divided actually into separate lots. Trimbak said to Govind that he was willing to act according to the vyavasiha which Govind might make of his share, and Govind, therefore, being sure that so long as Trimbak was alive he would carry on the whole vyavastha after his death exactly in the same way in which Govind was doing, made a vyavastha of the property in the terms following :- He provided for certain legacies in favour of his three daughters Manubai :- Belubai and Kasbibai who were then unmarried. He provided that Rs. 10,000 should be paid to his wife Ramabai as her stridhan and that she should live with Trimbak and should be permitted to use a sum of Rs. 300 per year in charity. If it was not possible for Ramabai to live with Trimbak, she was to live in the half portion of the dwelling house at Poona, and Trimbak and his children were each year to pay to her during her lifetime half the income whatever the same might come to out of the income of the immovable properties that might be received every year. But if Trimbak paid Rs. 1,300 every year to Ramabai, she was not to ask for an account of the income. That amount was by way of the yearly maintenance of Ramabai. Prom the income of the money-lending business appertaining to his share, Govind directed that Rs. 500 per year should be paid to Ramabai for giving in charities as she liked and the remaining in
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