Thursday, 28 August 2014

Whether court can decide issue of capacity of party to contract in suit for specific performance of contract?

 This Order is modified/corrected by Speaking to Minutes Order
When the suit is for specific performance of
contract, in view of section 9 of the Specific Relief Act,
the defences available under Specific Relief Act and under
the provisions of the Contract Act only are available to
defend the suit. If no defence is available like in the
present case, the Court is not expected to refuse the relief

of specific performance of contract when it is in respect of
immovable property. At the time of deciding such suit the
Court is not expected to consider and decide the issue of
capacity of party to contract even if such issue is raised by
the party to the contract. There is bar of estopple against
the defendant to raise such issue.

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD
Second Appeal No.1673 of 2005
 Maharu s/o Gaindhal Bhoi,

Versus
 Hemraj S/o Waman Patil

Citation; AIR 2014 Bombay 124
Read original judgment here;click here



CORAM: T.V. NALAWADE, J.

Judgment pronounced on : 2nd APRIL 2014.

JUDGMENT :
1) The appeal is filed against the judgment and
decree of Regular Civil Appeal No.58 of 1998 which was
pending in the Court of the District Judge, Jalgaon. The
appeal of the present appellant, plaintiff, filed against the
decision of Special Civil Suit No.62 of 1994 which was
pending in the Court of the Civil Judge, Senior Division,
Amalner, is dismissed by the First Appellate Court. Relief

of specific performance of contract is refused to the
appellant. Both the sides are heard.
2) The suit was filed in respect of agricultural land
admeasuring 4 acres which is part of land Gut No.100
which total admeasured at the relevant time, 17 acres and
25 gunthas. The suit portion is the northern portion of Gut
No.100/1 and in the agreement it was shown to be
separated by East – West bandh from remaining portion.
3) It is the case of the plaintiff that the defendant
is owner of the suit property and he agreed to sell the suit
property to the plaintiff under written agreement dated
18-5-1977. It is the case of the plaintiff that the agreed
consideration was Rs.30,000/- and on the date of
agreement an amount of Rs.17,000/- was paid by the
plaintiff to the defendant. It is contended that an amount
of Rs.10,000/- was paid before the Sub Registrar and
document was registered. It is contended that remaining
amount of Rs.3,000/- was to be paid to the defendant on
the date of execution sale deed. It is the case of the
plaintiff that for execution of sale deed permission was

necessary and the defendant was expected to take steps
for taking such permission and he was also expected to
take steps for division of Gut No.100/1 in the revenue
record and sale deed was to be executed within one month
thereafter.
4) It is the case of the plaintiff that he requested
the defendant many a times orally to execute sale deed
but the defendant avoided to do so. It is contended that
notice was given in writing to the defendant on 4-4-1979
and this notice was received by the defendant. It is the
case of the plaintiff that, the defendant did not reply the
notice and avoided to execute the sale deed. It is the case
of the plaintiff that second notice was issued on
18-8-1980. To this notice also no response was given by
the defendant.
5) It is the case of the plaintiff that he was and he
has been ready and willing to perform his part of the
contract. It is the case of the plaintiff that the defendant
has avoided to perform his part of contact and he is not
willing to perform his part of the contract. It is contended

that possession of the suit land was given to the plaintiff
under the aforesaid agreement and accordingly name of
the plaintiff has been entered in the revenue record from
1978-79. It is contended that even division of land Gut No.
100/1 was done in the revenue record to separate the
portion given in possession of the plaintiff. The plaintiff
had prayed for relief of specific performance of aforesaid
contract. In alternative, he had requested for relief of
refund of consideration amount with interest.
6) The aforesaid suit was given Special Civil Suit
No.5 of 1981. The defendant did not appear even after due
service of summons on him. The suit was initially decreed
ex parte. Execution Proceeding bearing No.28 of 1982
was filed by the plaintiff. Then the defendant applied for
setting aide the ex part decree. The ex parte decree was
set aside and the suit was given new number as Special
Civil Suit No.62 of 1994.
7) It is the case of the defendant that there was no
agreement of sale and he did not receive consideration as
contended by the plaintiff. He denied that he had given
This Order is modified/corrected by Speaking to Minutes Order

possession of the suit land to the plaintiff. It is his case
that behind his back by joining hands with revenue
authorities, the plaintiff has created false record of
Phalani of Gut No.100/1 and he has got his name entered
in the crop cultivation column.
8) It is the case of the defendant that he has three
brothers like Bhagwan, Bhimrao and Doghu. It is his case
that they had ancestral property at Hanumantkhede,
Tahsil Erandole. It is his case that his mother got some
property from her father at Savkhede, Tahsil Amalner. It is
the case of the defendant that, after demise of the mother,
they succeeded to the property of their mother. It is the
case of the defendant that, they treated the properties
from Savkhede and Hanumantkhede as joint Hindu family
property.
9) It is the case of the defendant that in the year
1966 partition took place amongst him and his three
brothers. It is his case that Gut No.100 from Savkhede
admeasuring 17 Acres 27 Gunthas was allotted to his
share. It is his case that land Gut No.106 of village

Savkhede was allotted to the share of brother Bhagwan. It
is his case that the properties from village
Hanumantkhede were given to the shares of Doghu and
Bhimrao. It is the case of the defendant that in the view of
these circumstances, the property from Savkhede had
become Joint Hindu Family property and his three sons
have share in the suit property.
10) It is the case of the defendant that he had taken
some amount as hand loan from the plaintiff but the
plaintiff has created false record of agreement of sale. It
his case that he is agriculturist and greater hardship will
be caused to him if relief of specific performance is given
in favour of the plaintiff. It is his case that at the relevant
time the price per are of this land was more than 20,000/-.
11) The defendant filed counter claim and prayed
for relief of declaration that aforesaid transaction is not
binding on him. He also prayed for relief of possession of
the suit property which is in possession of the plaintiff. To
this counter claim, the plaintiff filed say and he denied the
claim of the defendant.

12) Issues were framed on the basis of the
aforesaid pleadings. Both sides gave evidence. The trial
Court held that there was agreement of sale. The trial
Court also held that the plaintiff was ready and willing to
perform his part of contract. The trial Court, however,
held that the suit property needs to be treated as Joint
Hindu Family property of defendant and his sons. The trial
Court held that the plaintiff has failed to prove that there
was legal necessity for the transaction. The trial Court has
held that the transaction between plaintiff and defendant
is not binding on other members of the Joint Hindu Family.
The trial Court has given relief of possession to the
defendant. The trial Court has directed return of the
consideration amount. The First Appellate Court has
confirmed this decision of the trial Court.
13) By the order dated 5-9-2006 this Court has
decided to formulate substantial questions of law in terms
of Ground Nos. IV, V, VI, VII, IX and X of the appeal
memo. They are as under :-

(I) whether the defendant is entitled to raise the
defence that agreement dated 18-5-1977 was without
legal necessity when the other co-parceners of the family
had not joined as party and they had not taken such
defence ?
(II) whether the Courts below are justified in holding
that the suit property is Joint Hindu Family property of the
plaintiff and his sons ?
(III) whether the defendant can take defence in a suit
filed filed for specific performance of contract that he is
not the sole owner of the property, relief of specific
performance of contract cannot be given against him ?
(IV) whether the transaction between plaintiff and
defendant can be treated as void ab initio or whether it
was only voidable at the instance of other co-parceners ?
(V) whether the plaintiff is entitled to retain possession
till non alienating coparceners sue for recovery of
possession of the suit property.

14) The documentary evidence shows that the
agreement was registered and in the presence of the Sub
Registrar consideration of Rs.10,000/- was given by the
plaintiff to the defendant on 18-5-1977. The execution of
this document is not disputed. In the document at Exhibit
16 there is mention that the portion which was to be sold
to the plaintiff was divided, separated by construction of
east – west bandh and portion towards northern side of
the bandh was to be sold to the plaintiff. At Exhibits 52
and 20 there are copies of mutation entries showing that
they were sanctioned on 31-5-1979 as the possession was
actually given to the plaintiff (Mutation No.1335). At
Exhibit 53 there is copy of other mutation bearing No.
1291 and it was sanctioned on 2-12-1976. This mutation
shows that portion admeasuring 1.66 Hectare was earlier
sold by the defendant to one Yadav Laxman Kulkarni on
21-8-1976 for consideration of Rs.30,000/- from Gut No.
100. Due to this transaction the land was divided in
revenue record and the portion in possession of the
defendant was given Gut No.100/1 admeasuring 5.49
Hectares. The portion which was sold to Kulkarni was
given Gut No.100/2. Exhibit 53 shows that on the basis of

document executed in favour of the plaintiff, further
division of land Gut No.100/1 was done. The portion of the
plaintiff viz 1 Hectare and 61 R was given Gut No.100/1A.
In the 7/12 extract, in crop cultivation column name of the
plaintiff was entered. There is copy of order made by the
revenue authority at Exhibit 60 in this regard. The
revenue record shows that at least from 1980-81 the name
of the plaintiff was entered in the revenue record and the
crop cultivation column showing that he was actually in
the possession. These entries, mutations were never
challenged by the defendant or his sons. Similarly the
name of Kulkarni was shown in the 7/12 extract and the
crop cultivation column of the portion held by him and
these entries were also never challenged by the defendant
or his sons.
15) Exhibit 69, the 7/12 extract shows that in land
Gut No.100/1 there was one pencil entry in favour of
Bhalerao Shankar showing that the defendant had agreed
to sell 1.61 Hectare portion to him also. The record shows
that there was no permission given by the revenue
authority to this transaction, this transaction was held as

illegal and so the pencil entry was made. It appears that
subsequently said Bhalerao returned the land by
accepting more money from the defendant and this entry
was also cancelled. Bhalerao has given evidence in favour
of the defendant in this regard. But that circumstance can
be used against the defendant.
16) Exhibit 56 is copy of Mutation No.1478. It
shows that portion of 91 R from same Gut number, Gut
No.100/1, was sold subsequently by the defendant to one
Ravindra Ramnath Patil.
17) The aforesaid revenue record and more
particularly mutation entry shows that the defendant had
sold portion of 1.66 H to one Kulkarni. Prior to entering
into agreement with the plaintiff he had agreed to sell
similar portion to Bhalerao. The land was standing in the
name of the defendant and the defendant was not shown
as Karta of the Joint Hindu Family. Even after entering
into the transaction with the plaintiff, the defendant sold
some portion to Ravindra Patil. This transaction was not
challenged by the sons of the defendant. This

circumstance cannot be ignored in view of nature of
defence taken by the defendant. The aforesaid record
shows that similar portion was sold by the defendant to
Kulkarni. The evidence of Bhalerao on the record shows
that Bhalerao was in possession of the land, he enjoyed
the land but defendant paid Rs.19,000/- for getting back
possession from Bhalerao against the agreed amount of
Rs.14,000/-. Record of agreement made with Bhalerao is
however suspicious in nature.
18) Mutation Entries 67 and 69 show that the
defendant and his three brothers had equal, one forth
share in land Gut No.100 from Savkhede. By Mutation No.
1273 names of brothers of the defendant were deleted as
per application given by them and so since 26-3-1966 only
defendant was shown as the absolute owner of land Gut
No.100. After that, the defendant made the aforesaid
transactions. The revenue record further shows that
there was loan taken by the defendant from Land
Development Bank (Mutation No.1227) and the loan was
taken from one society also on 5-6-1968. Thus, the
defendant was acting as absolute owner of land Gut No.

100.
19) Copy of Mutation No.551 at Exhibit 106 shows
that it was sanctioned on 7-1-1963 and the mutation was
made on the basis of oral partition amongst the defendant
and his brothers dated 12-12-1962. This document shows
that under this partition, the defendant was given 4
Hectares 14 Gunthas land form Survey No.9/2 from village
Hanumantkhede. Bhagwan and Bhimrao, the two other
brothers, also got land from Hanumantkhede. The portion
which was allotted to the defendant was given separate
number bearing Sy. No.9/2B. Exhibit 107 is mutation
dated 28-10-1963. This mutation was effected on the basis
of oral partition dated 13-1-1963 in favour of Doghu,
brother of the defendant and separate survey No. 11/1-2
of village Hanumantkhede was given. Copy of Mutation at
Exhibit 108 shows that Doghu got share from the land of
village Hanumantkhede under oral partition dated
26-3-1963 and survey number 12/3 was given to him. The
last two lands were given to Doghu by Rajdhar Rawaji
Patil, probably other branch.

20) The aforesaid revenue record shows that
partition had already taken place amongst the defendant
and his three brothers in 1963. The partition was in
respect of ancestral property owned by them and situated
at village Hanumantkhede. Admittedly, the land Gut No.
100 from Savkhede was the property of their mother. After
demise of mother, names of these four brothers were
entered in the revenue record as heirs of their mother.
The defendant is relying on Exhibit 67, Mutation dated
26-3-1966 made in respect of land Gut No.100. But this
document does not show that it was made on the basis of
partition. On the basis of this document it can be said that
application was given by these four brothers to the effect
that they had done some exchange of lands. Only on the
basis of this document it cannot be inferred that the
property from Savkhede become Joint Hindu Family
property of the defendant and his sons. It was necessary
to prove by the concerned, sons of the defendant, that the
property at Hanumantkhede was exchanged for getting
Gut No.100 (three forth share).

21) The parties are governed by Mitakshara school
of Hindu law. Whether all the property is ancestral, joint
Hindu family property or not, is question of fact and that
needs to be proved like any other fact. Admittedly, oneforth
share in Gut No.100 had come to the share of the
defendant from his mother. Under Hindu law, whatever
property was received from his mother was his absolute
property. Only due to mutation at Exhibit 67 inference
cannot be drawn that the property at Savkhede was Joint
Hindu Family property of the defendant and his sons. It
was necessary for the concerned to prove that property
was thrown in the common stock with intention of
abandoning all separate claims upon it. Clear intention in
that regard needs to be established and only after that the
doctrine of blending can be used. Blending is possible only
if coparcenery property is in existence on the relevant
date. It is already observed that in the year 1963 itself
partition had taken place amongst defendant and his three
brothers. Thus if at all some property from
Hanumantkhede was given by the defendant to his
brothers for getting their shares from land Gut No.100, it
was necessary to prove the same by the persons affected.

22) The trial Court and the First Appellate Court
have committed error in holding that partition took place
amongst the defendant and three brothers in the year
1966 and there was the blending of the suit property. It
appears that the Courts below have given undue
importance to some admissions given by Dangal, PW 3,
examined by the plaintiff. The defendant could not have
opposed the suit filed for specific performance of the
contract in view of the provisions of law and the aforesaid
circusmtances. Neither in the revenue record nor in the
agreement there was whisper that the property was
belonging to the Joint Hindu family.
23) In the cases reported as AIR 1954 Nagpur 65
(S.K. Buty v. Shriram) and AIR 1967 SC 574
(Radhakrishnadas v. Kaluram) this Court and the Apex
Court have discussed the powers of manager, Karta of
Joint Hindu family. The observations made show that
under the Hindu law, the Karta has power to alienate the
joint Hindu family property so as to bind the interest of all
coparceners provided the alienation is made for legal
necessity. In the cases reported as AIR 1954 Nagpur 65

(Butty v. Shriram) it is laid down by this Court that
Court may grant relief of specific performance of contract
made by manager even if some members are minor.
24) The position of Hindu law is that, the father if
he is acting as Karta, he can sell the joint Hindu property
for repayment of own debt also if it was not incurred for
illegal purpose. Reliance is placed on a case reported as
A.I.R. (29) 1942 Nagpur 66 (Dharamrajsingh v.
Chandrashekhar Rao). This Court has already observed
that there were entries in revenue record showing that
loan was obtained by the defendant from Land
Development Bank and also from a society. This record
shows that the defendant was in need of money. This
circumstance could have been considered by the Courts if
the suit was contested by the concerned, the sons of the
defendant.
25) In the case reported as AIR 1971 SC 776 (Raj
Kumar v. Ambica Prasad) and 1964 Mh.L.J. 133 SC
(Guramma v. Mallappa) the Apex Court has laid down
that alienation made by the manager without legal

necessity is not void but voidable at the instance of the
other coparceners. (underline added). In view of the
aforesaid position of law and the facts and circumstances
of the case it was not open to the defendant to say that
transaction was not made for legal necessity. The
defendant was living with his sons. If his sons had
grievance that the defendant had acted beyond his
powers, the sons could have joined as party to the suit if
they wished. When the person entitled to get relief of
declaration was not party to the suit, there was no
question of giving such relief in their favour by the Courts
below. The defendant certainly is not entitled to get such
relief. Thus the Courts below have committed error in
giving relief of declaration that the transaction is not
binding on he other members of the Joint Hindi family.
26) When the suit is for specific performance of
contract, in view of section 9 of the Specific Relief Act,
the defences available under Specific Relief Act and under
the provisions of the Contract Act only are available to
defend the suit. If no defence is available like in the
present case, the Court is not expected to refuse the relief

of specific performance of contract when it is in respect of
immovable property. At the time of deciding such suit the
Court is not expected to consider and decide the issue of
capacity of party to contract even if such issue is raised by
the party to the contract. There is bar of estopple against
the defendant to raise such issue.
27) In view of the aforesaid position of law and the
facts and circumstances of the case, this Court has no
hesitation to hold that both the Courts below have
committed serious error in refusing the relief of specific
performance of contact to the plaintiff and in granting
counter claim of the defendant. In the result, the
aforesaid substantial questions of law are decided against
the defendant and following order is passed.
28) The appeal is allowed with cost. The judgment
and decree of the trial Court and the First Appellate Court
are set aside. The counter claim of the defendant is
dismissed. The suit of the plaintiff for the relief of specific
performance of contract is decreed with cots in the
following terms :

(a) The defendant to execute registered sale deed in
favour of the plaintiff of the suit property as per the terms
of the agreement. The defendant is entitled to get the
amount of Rs.3,000/- if already deposited by the plaintiff
in the Court. If the amount is already not deposited, it is
to be deposited within one month from today.
(b) If the defendant fails or refuses to execute the sale
deed, the sale deed is to be executed through officer of
the Court.
Sd/-
(T.V. NALAWADE, J.)

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