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1924 Supreme(Nagpur) 100

NAGPUR JUDICIAL COMMISSIONERS COURT
Baker
RAJARAM – Appellant
Versus
RAMCHANDRA – Respondent
Second Appeal No. 261 of 1923
Decided on : 27-06-1924

Advocates Appeared:
A V Khare, R R Jayawant, Advocates

A minor can challenge a transaction after coming of age, and a guardian cannot bind a minor by a personal covenant. The time limitation for a claim can be determined based on the nature of the contract and registration under the Limitation Act.

Headnote:

Mortgage - Minor's Guardian's Transaction - Damdupat Rule - Berar - Sale-Deed - Deed of Transfer - Set-off - Limitation Act - Registered Contract - Guardian's Covenant - Trustee's Claim - Minor's Suit - Time-barred Claim

Fact of the Case:

The plaintiff's father executed a mortgage-deed in favor of the defendant. During the plaintiff's minority, the plaintiff's mother executed a sale-deed and a deed of transfer to satisfy the debt. The plaintiff sued to recover the balance of the unpaid consideration. The defendant claimed a set-off and argued that the claim was time-barred.

Finding of the Court:

The court found that the plaintiff could not be bound by the personal covenant in the deed executed by his guardian, and the defendant cannot claim to set off the amount in the present suit but must seek his remedy against the guardian. The court held that the claim was not time-barred under the Limitation Act.

Issues: The issues involved the validity of the deed of transfer, the defendant's claim for set-off, and the time-barred nature of the claim under the Limitation Act.

Ratio Decidendi: The court held that a minor can challenge a transaction after coming of age, and a guardian cannot bind a minor by a personal covenant. The court also determined that the claim was not time-barred under the Limitation Act due to the contract being in writing and registered.

Final Decision: The court upheld the view of the lower courts, dismissing the appeal and ruling in favor of the plaintiff.

JUDGMENT

Baker—Although the facts of this case are given in the judgments of the lower Courts, they are a little unusual and it will be well to repeat them.

2. The plaintiff's father executed a registered mortgage-deed in favour of the defendant in 1906 for Rs. 1,500. He died, leaving the plaintiff, a minor, and during his minority the plaintiff's mother Rangubai, in satisfaction of the debt due on this mortgage, executed on 25th June, 1917 two documents, namely, one sale-deed of the property mortgaged, the consideration being Rs. 3,000, and one deed of transfer for Rs. 1,000 by which she transferred the right of receiving money due under a lease from one Sitaram for four years. The consideration of this document was Rs. 1,000 made up as follows: Rs. 475 due on another mortgage, which the defendant paid, and Rs. 525 due on the original mortgage of the defendant for Rs. 1,500. The defendant represented to her that on making account Rs. 3,500 was due. The plaintiff brought the present suit alleging that as the rule of Damdupat applied to Berar, only Rs. 3,000 were due on the mortgage and, therefore, it was fully satisfied by the sale-deed. Out of the consideration of the transfer deed, therefore only Rs. 475 were paid and the plaintiff, while admitting the transaction to be binding on him, sued to recover the balance of Rs. 525.

3. The defendant pleaded that the whole consideration purporting to be transferred by the deed of transfer was not received by him, because when he sued Sitaram for the rent for four years it was found that Rangubai had already recovered Rs. 650 out of it and that the defendant, therefore, received only about half the consideration, and he claimed to set off this sum of Rs. 650 against the plaintiff's claim.

4. The First Court, Munsif of Daryapur, decreed the plaintiff's claim. The defendant appealed and the appeal was dismissed by the Additional District Judge, East Berar. The defendant makes this second appeal.

5. It is not disputed that the rule of Damdupat applies to Berar and that only Rs. 3,000 were duo on the mortgage, but the defendant's case is that as the plaintiff accepts the position that the deed of transfer is valid and binding between the parties, he cannot claim full consideration unless he shows he has passed the full property. Rupees 650 were received by Rangubai out of the sum due from Sitaram, which had been transferred to the defendant, so the plaintiff cannot claim a refund of the unpaid portion of the consideration for the transfer.

6. There can be no doubt that the minor can challenge the transaction after coming of age. It also appears that out of the total consideration for the two documents, the sale-deed and the deed of consignment, Rs. 4,000 the actual consideration received by Rangubai on behalf of the minor was Rs. 3,475, namely, Rs. 3,000 due on the mortgage of Rs. 1,500, double the principal, and Rs. 475 paid on account of another mortgage with which we are not concerned in this case. The plaintiff, therofore, would be prima facie entitled to recover the balance of the unpaid consideration, unless the defendant has any right to the set off. That a Hindu widow in Berar is not justified in alienating her husband's property for payment of interest in excess of what was legally recoverable under the rule of Damdupat has been held by this Court in Ramchandra v. Radha,1915 10 NLR 91.

7. The First Court held that the receipt for Rs. 650 was without consideration and should not have affected the case. The first Appellate Court has not given any definite finding on this point, but it is contended that assuming the payment to have been made it is Rangubai alone who can be proceeded against for breach of covenant and a claim for damages against the guardian cannot be litigated in any dispute between the minor and the assignee, It is, of course, settled law that a guardian cannot bind a minor by a personal covenant, and though the defendant may be able to claim this amount from Rangubai, he




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