It is settled law that the manager of a joint Hindu family which includes minors can enter into a contract for the sale or purchase of immovable property and the contract can be specifically enforced against the family including the minors provided the transaction is for legal necessity or for the benefit of the estate.
IN THE HIGH COURT OF NAGPUR
Decided On: 10.03.1952
Appellants: S.K. Buty
Vs.
Respondent: Shriram Hari Tambe
Vs.
Respondent: Shriram Hari Tambe
Hon'ble Judges/Coram:
Deo, J.
Citation: AIR1954Nag65, [1953]ILR Nag57
1. This is Defendant's appeal against the reversing judgment decreeing the Plaintiff's claim for specific performance.
2. The Defendant is a moneylender and has extensive house and landed property. He was a malguzar of mouza Ambazari till the malguzari rights were abolished by the Abolition of Proprietary Rights Act of 1951. He was the owner of khasra No. 77 which was waste morrum land. Out of the area of 23 acres of this khasra number, the Defendant prepared a lay-out of 12.58 acres dividing it into 60 building plots of varying dimensions. The lay-out was sanctioned by the Civil Station Sub-Committee, Nagpur on 5-11-1936 as this area was then within the jurisdiction of that Committee. The Defendant started selling these plots from about January 1937 in full proprietary rights and had disposed of about 17 plots before the agreement in dispute.
3. The Improvement Trust, Nagpur, which came into existence later on, included the entire field khasra No. 77 in the Dharampeth Extension Scheme. Unless the Defendant got the Trust to exclude the area from the Scheme, it would have acquired the land and in that event the Defendant would have obtained a nominal compensation as for fallow agricultural land. Khasra No. 78, area about 25 acres, which adjoins this land and is similar in agricultural productivity was acquired by the Trust on payment of compensation at Rs. 250/- per acre. As deposed to pay D.W. 3, that land was under cultivation. Khasra No. 77 was always lying fallow and did not yield any income. Under these circumstances it was necessary in the interest of the Defendant and his family and in discharge of the obligations to the persons to whom he had already conveyed some of these plots to obtain the sanction of the Improvement Trust for the lay-out. The Defendant was anxious to obtain the sanction for the layout of the entire area of 23.96 acres, but by the resolution dated 28-9-1940 (Exhibit p-11) the Board of Trustees sanctioned the lay-out of 12.58 acres as was previously sanctioned by the Civil Station Sub-Committee, The Defendant agreed to this revised lay-out on 18-9-1940 & to the draft of the agreement prepared by the Trust on 19-9-1940. The Defendant then desired that he should not be burdened with the entire cost of the two roads and that the Trust should share the costs. The final agreement Ex. P-18 was executed on 18-10-1940 after it was approved by the Board of Trustees on 28-9-40. Since the agreement with the Civil Station Sub-Committee embodying the terms on which the sanction was granted to the lay-out is not on record, it is not possible to say if the later agreement with the Trust was more onerous than the former. The sanction of the Civil Station Sub-Committee to the lay-out could not have been obtained without the Defendant undertaking the works of development of the lay-out and the Civil Station Sub-Committee would not have accepted that burden.
4. On 10-10-1940 the Defendant entered into the agreement (Exhibit P-1) with the Plaintiff to sell to him one plot out of this lay-out at the rate of 4½ square feet per rupee. The description of the plot as given in the agreement is "plot No. 4, in block C, measuring 120 feet north-south and 100 feet east-west, abutting on the road of 60 feet wide towards the north according to the dimensions in the revised lay-out of the Improvement Trust when completed." It was agreed that the sale deed would be executed after the agreement between the Improvement Trust and the Defendant was completed. By 10-10-1940 the Defendant received Rs. 500/- as earnest money. On the same date the Defendant gave a letter (Exhibit D 5> which is signed by his agent, stating that the price agreed included the general contribution, sewer charges of the improvement (?)
5. The Defendant did not execute the sale deed according to the agreement. After making various efforts to get the sale deed, the Plaintiff sent a lawyer's notice (EX. P. 2) dated 16-4-1942 demanding specific performance of the agreement. Exhibit P-3 dated 29-4-42 is the reply sent by Shri Bobde on behalf of the Defendant. The Defendant alleged that he was required by the Trust to pay charges not only for the sewer and general contribution but also for storm drains, water-main and 60 feet road which the Plaintiff was bound to pay to the Defendant "in pursuance to and in consequence of the agreement of sale between the parties". The Defendant complained that the Plaintiff was shirking the payment of his share of the charges on account of these three additional items. The Defendant expressed his willingness to execute the sale deed on payment of those amounts. He did not specify the amount of contribution which he claimed from the Plaintiff. By the reply Ex. P. 17, dated 7-5-42, Plaintiff repudiated this statement and insisted on the Defendant executing the sale deed in accordance with the terms agreed between the parties. The Plaintiff asserted that there was no agreement to vary those terms and to pay the charges claimed. The Defendant having refused to execute the sale deed in accordance with the agreement between the parties, the Plaintiff instituted this suit.
6. The Defendant denied the claim on the ground that the Plaintiff was wrongfully refusing to pay the contribution for storm drains, water-main and 60 feet road payable under the express agreement recited in Ex. D-5. Even otherwise, the Defendant was entitled to be reimbursed in. law for this contribution for developments which, he paid to the improvement Trust. On account of the Plaintiff's refusal to make these payments, he had forfeited his earnest money. The Defendant also claimed the dismissal of the suit on the following grounds:
(a) that the land specified in the agreement Ex. P-1 was not available for transfer as the final layout of the Improvement Trust materially altered the situation and consequently the agreement became incapable of specific performance;(b) by decreeing the claim the Plaintiff would be getting an unfair advantage over the Defendant by having these development amenities at the cost of the Defendant;(c) the Plaintiff's refusal to pay the public charges accrued since the date of the agreement, including those payable to the Improvement Trust: disentitles him to any relief;(d) specific performance cannot be enforced inasmuch as the transferability depends upon the sanction of the lay-out by the Improvement Trust and also depends upon the obligation to pay such charges as would be levied by the trust; and(e) the Defendant who is a manager of the joint Hindu family is incompetent to transfer the interest of his minor son. Alternatively it was pleaded that if the Plaintiff is found entitled to specific performance in spite of the above defences, he can claim specific performance only of the interest of the Defendant on payment of the full consideration. It was asserted that the Defendant was always willing to convey his half interest in the plot for the full considerations agreed between the parties.
7. The trial Court held that the agreement between the parties was as contended by the Plaintiff and the grounds on which the Defendant refused to perform the contract were all untrue and improper. The trial Court, however, held that the agreement entered into by a manager of a joint Hindu family on behalf of the family can be specifically enforced not only against the interest of the manager in the family property but also against the interest of the other coparceners including the minors provided that the transaction is for the legal necessity or for the benefit of the estate. As the case of legal necessity or benefit to the estate was not set up by the Plaintiff, the suit for specific performance was dismissed and the alternative claim for refund of earnest money and damages was decreed.
8. The Plaintiff appealed and applied for amendment of his plaint. The learned District Judge allowed the application and framed the following issues for trial by the lower Court:
(i) Did the Defendant enter into the agreement to sell the plot as the Karta of the joint Hindu family?(ii) Is the sale of the plot in suit for the benefit of the estate?
These issues were remitted to the lower Court for trial as the Defendant wanted to lead evidence in regard to these issues. As a matter of fact the first issue did not arise in view of the Defendant's admission that he had entered into the agreement as 'karta'. The Defendant then filed a written statement in answer to the amended plaint in which he alleged that the transaction was not for the benefit of the estate & there was no legal necessity to sell the land, that the scheme of converting the agricultural land into building plots for sale was not the ancestral business carried on by the family and that the transaction of this new business could not bind the minor son. It was further alleged that the Defendant did not ascertain the costs of the improvement, that this venture proved too costly and was injurious to the interest of the joint family, that the land could have been used for gardening, orchards, flower garden and general agriculture, that the land would have fetched Rs. 1000/- per acre, and that the Defendant did not thus act as a prudent manager in selling the land on the terms of the lay-out. After recording such further evidence as the parties chose to adduce, the trial Court found that the transaction was for the benefit of the estate and that the joint family benefited enormously by the move taken by the Defendant. The Defendant filed cross-objections challenging these findings.
9. Although the learned District Judge had directed the Appellant to amend the plaint, the amendment was not incorporated in the plaint. After the findings were received an application was made to the District Judge for extension of time under Section 148, Code of Civil Procedure to amend the plaint. This application was opposed by the Defendant on the ground that time could not be extended in. law and that alternatively there was no sufficient cause for granting the extension as the Appellant was careless and negligent in not carrying out amendments within the time prescribed by Order 6, Rule 18, Code of Civil Procedure The learned District Judge overruled these contentions and allowed the Plaintiff to amend the plaint. The learned Judge accepted the finding of the trial Court, allowed the appeal and decreed the claim for specific performance.
10. This decree is attacked by the learned Counsel for the Defendant-Appellant on every conceivable ground and he addressed very lengthy arguments in support of his contentions.
11. The first contention raised by the learned Counsel is that the specific performance should be refused as the agreement Ex. P. 1 is indefinite regarding the plot to be conveyed and the Plaintiff has not laid a claim regarding the plot in the layout of the Improvement Trust. It was further contended that the plot agreed to be sold is not now available as the final lay-out has materially altered the situation. None of these contentions has any substance. As will appear from the agreement Ex. P-l, the variation in the dimensions of the area by the final lay-out of the Trust was contemplation of the parties. On a true construction of the agreement it must be held that the agreement was to sell the plot at the site mentioned in the agreement as will appear in the final lay-out of the Improvement Trust and the area so ascertained will be paid for at the rate specified in the agreement. A lump sum price for the whole plot was not fixed as the dimensions and the area were liable to be varied in the lay-out of the Trust. The Plaintiff seeks to enforce this agreement and has 'pleaded all relevant facts. The lower appellate Court has rightly held him entitled to a decree for the plot as in the final lay-out of the Improvement Trust. The dimensions of the plot are slightly varied in this lay-out. The east-west dimension is 112'-6" while the north-south dimension is 119' on the eastern side and 107'-6" on the western side. The plot is abutting on the 60-feet road and also on the 30-feet road to the east.
12. The learned Counsel next contends that the suit should be dismissed as the Plaintiff had refused to abide by the contract Ex. P-1, read with Ex. D-5. It was pleaded that the Plaintiff had agreed to pay the charges which are specifically mentioned in the letter Ex. D.5. That document states that the price of 4¼ square feet per rupee includes "the general contribution, sewer charges of the improvement". By Ex. P-18 the Defendant agreed to pay to the Improvement Trust a particular sum as general contribution to meet the expenses of general works of the nature of water-main, outfall sewer, sewage disposal etc. It is evidently to this liability that reference is made in Ex. D-5. That document provides that the Plaintiff will not be liable to pay for "general contribution" in addition to the price. The construction of storm drains, water main and 60-feet road was the obligation of the Defendant under the agreement Ex. P-18. This was admittedly in addition to the general contribution mentioned in Ex. D-5. The Defendant claims contribution from the Plaintiff for these expenses which he had to incur in preparing a lay-out in addition to a proportionate contribution towards the amount payable to the Improvement Trust as a general contribution. The Plaintiff as P. W. 1 has stated that he expressly told the Defendant that he would not be liable to pay anything with regard to the Improvement Trust charges and that he was not to pay anything in addition to the price agreed. He admitted that there was no specific mention at the time of agreement about contribution for 60-feet road.
The Defendant's statement that he made it clear to the Plaintiff that he would have to contribute towards the expenses of storm drains, 60 feet road and water-main in addition to the amount payable to the Improvement Trust under the agreement Ex. P-13 cannot be true. If the Plaintiff was to bear all these charges, they would have been specified in Ex. D-5 or in Ex. P-1. As stated by him, he agreed to pay the general contribution and sewer charges payable to the Improvement Trust under Ex. P-18 and that was included in the rate agreed. Though Landge declined to abide by the alleged contract and pay the additional charges claimed by the Defendant, the latter returned the earnest money to the former together with interest at 1/- P.C. p.m. The Defendant would not have paid this interest if Landge was not justified in refusing to pay additional charges (Ex. D-4). Under these circumstances, I agree with the lower appellate Court that the claim under the three heads in dispute was an afterthought and was not part of the agreement.
13. The learned Counsel next submits that the Defendant is entitled to these charges apart from the agreement in view of Section 68(1) & Section 68(6) of the Improvement Trusts Act, 1936. These provisions are:
68. (1) Wherever in any area comprised in any improvement scheme under this Act the Provincial Government has sanctioned the acquisition of land which is subsequently discovered to be unnecessary for the execution of the scheme, the owner of the land or any person having an interest therein, may make an application to the Trust requesting that the acquisition of the land should be abandoned in consideration of the payment by him of a sum to be fixed by the Trust in that behalf.… … …
(6) Every payment due from any person under any agreement executed under Sub-section (4) shall be a charge on the interest of that person.… … …
The Defendant has not pleaded this case nor has he claimed any particular amount as contribution. Nor has he given any data to arrive at that figure. On the contrary, as a witness he has asserted that he Trust had not notified this land, thereby meaning that the Trust had not notified acquisition of he land. If that were so, Section 68(1), and consequently Section 68(6) would have no Applicant. The charge specified in sub-section (6) is as regards the amount payable under sub section (1) (sic) a price for abandoning the acquisition. The contribution towards that price was admittedly (sic) in the rate agreed between the parties. The Defendant was bound under the agreement. Ex. P-18 construct the several works of development (sic) in that agreement in consideration of the improvement Trust agreeing to accord its sanction the construction of buildings on this site. If see expenses could be construed as encumbrances the property, then under Section 55(1)(g) transfer of Property Act the seller is bound to disagree the encumbrances unless there is an agreement to the contrary. There as no such agreement this case.
14. The learned Counsel next relied on Section Specific Relief Act which provides that a Court will not direct specific performance of a part of a contract except in cases coming under one or the (sic) of the last three preceding sections. The (sic) Counsel invokes all the three Sections 14, and 16. Section 16 has obviously no application it refers to a case where the contract consists two separate and independent parts and one of (sic) can and ought to be specifically performed (sic) the other cannot and ought not to be so per-(sic). This is not the case here.
15. Section 14 provides:
There a party to a contract is unable to perform the whole of his part of, it, but the part which (sic) be left unperformed bears only a small proportion to the whole in value, and admits of compensation in money, the Court may at the suit of either party, direct the specific performance of so much of the contract as can be performed and award compensation in money for the deficiency.
The learned Counsel submits that the plot in the Trust lay-out is not identical with the original plot agreed to be sold and has a larger area. The Plaintiff can claim performance, if at all, of the area agreed to be sold and since the rules of the Trust do not provide for splitting up of the plot, specific performance should be refused. This argument proceeds on a misconception as regards the nature of the agreement as pointed out above. The agreement is for the entire area as will appear in the final lay-out sanctioned by the Trust. If specific performance is granted, the Defendant would be entitled to the price for the entire area at the rate specified in the agreement.
16. It was further submitted that the transferability of the plot in the final lay-out depends upon the sanction of the Improvement Trust which is subject to the payment of the charges payable to it under the agreement Ex. P-18 and as may be levied by the Trust thereafter. Under the agreement Ex. P-18 the Defendant was liable to pay a specified amount for the general contribution to meet the expenses of general works of the nature of water-mains, outfall sewer, sewage disposal and the like. That amount has been paid by the Defendant, as will appear from the evidence of the Defendant and his account books Ex. D-15. Under the agreement the Defendant had undertaken to do certain constructional development works and had agreed to deposit Rs. 8,000/- as security for carrying out this obligation. The agreement provides:
in case he fails to carry out the works or any of them as per items agreed hereby, the said Trust shall be entitled to carry out the same at his risk and cost and to recover the cost from the said securities. Should the amount of the securities be found insufficient to cover the cost, the said Mr. Buty will be liable to the Trust for the entire or balance of the cost, as the case may be. The Trust agrees that in consideration of Mr. Buty agreeing to the above terms of Trust will grant sanction for construction of buildings in accordance with the building regulations of the Trust in force on the plots in the lay-out.
The Trust has thus sanctioned the lay-out and agreed to grant sanctions for the construction of buildings by purchasers from the Defendant who incurred a personal liability to the Trust for carrying out the development works or to reimburse the Trust if it was required to carry them out. There is no evidence that the Trust refused its sanction to the construction of any building for the alleged failure of the Defendant to carry out his obligations under the agreement. Moreover, the Defendant cannot invoke his own defaults in fulfilling his obligations under the agreement to defeat the Plaintiff's claim if it is otherwise good. There is no dispute in this case of the levying of any public charges by the Improvement Trust other than the obligations under the agreement Ex. P-18. The Defendant cannot be and was not made liable by the Trust for any public charges payable by the Plaintiff.
17. The learned Counsel contended that the Defendant is entitled to claim from the Plaintiff the municipal taxes said to have been paid by him for the plot in suit and evidenced by Exs. D-13, & D-14. This claim was not set up by the Defendant either in the notices or in the written statement. Under Section 55(1)(g), Transfer of Property Act the seller is bound to pay all public charges and rent accrued due in respect of the property up to the date of the sale, interest on all incumbrances on such property due on such date and except where the property is sold subject to incumbrances, to discharge all incumbrances on the property then existing. The Defendant is not entitled to reimbursement for any municipal taxes paid by him for a period prior to the date of sale.
18. The next contention is that half of the plot belongs to the minor son of the Plaintiff and the agreement cannot consequently be enforced having regard to Section 15, Specific Belief Act unless the Plaintiff is willing to pay the full consideration for the one-half interest of the Defendant. Section 15 runs thus:
Where a party to a contract is unable to perform the whole of his part of it, and the part which must be left unperformed forms a considerable portion of the whole, or does not admit of compensation in money, he is not entitled to obtain a (sic) for specific performance. But the Court may, at the suit of the other party, direct the party in default to perform specifically so much of his part of the contract as he can perform, provided that the Plaintiff relinquishes all claim to further performance, and all right to compensation either for the deficiency, or for the loss or damage sustained by him through the default of the Defendant.
Reliance is placed on - 'Singhai Ramlal v. Kan-hayalal' A.I.R. 1926 Nag 493 (A) which follows - 'Baluswami Aiyar v. Lakshmana Aiyar MANU/TN/0211/1921 : AIR 1921 Mad 172 (FB)(B) and on - 'Mohammadkhan v. Bapumiya MANU/NA/0110/1943 : AIR 1943 Nag 313(C), where the intended alienations were neither for legal necessity nor for benefit to the estate. In the last case the contract was conditional on the consent of the co-owners who were not parties to the contract and they refused their consent. It was not the case of an agreement by the 'karta' for sale either for legal necessity or for benefit to the estate. The lower appellate Court has found that the sale was for the benefit of the estate and conseqently the agreement could be enforced specifically against the manager for the whole area.
19. The learned Counsel next pressed the disingenuous and ill-advised defence of the Defendant that the transaction is not for the benefit of the estate and confers an unfair advantage on the Plaintiff. The learned Counsel contends that this case of benefit to the estate, which was not raised in the original plaint, should not have been allowed by the lower appellate Court to be introduced by a belated amendment, particularly when a very senior Counsel of this Bar appeared for the Plaintiff in the trial Court. The learned Counsel also raised the contention that the amendment should not have been allowed to be incorporated in the plaint and should be deemed to have been disallowed as it was not incorporated within 14 days of the order as required by Order 6, Rule 18, Code of Civil Procedure.
No doubt, the junior counsel for the Plaintiff who evidently was in charge of the case was not diligent enough to incorporate the amendment in the plaint in the proper time, but as soon as the omission was noticed the Plaintiff made an application to the trial Judge for extension of time and for leave to incorporate the amendment. That Court rejected the application on the ground that it had no jurisdiction to extend the time as the District Judge had passed the order allowing the amendment. An application was therefore made to the District Judge for an extension of time and that application was granted. The learned Counsel could not bring to my notice any authority in support of his contention that the District Judge had no jurisdiction to extend time. His contention is against the specific provision in Order 6, Rule 18, Code of Civil Procedure, to extend timed. As the learned Judge rightly pointed out, the Defendant was vehemently opposing the application because he had no case on merits. In my view the jurisdiction was properly and judicially exercised and I see no reason to interfere with that order.
20. In answer to the interrogatories served on him by the Defendant, the Plaintiff had stated that he did not know that the property was ancestral and the minor son of the Defendant had a share therein, that he was never in doubt regarding the Defendant's legal capacity to alienate the plot till the contention was raised in the written statement. He further stated that the Defendant had entered into numerous transactions of a similar nature for the benefit of the estate in the course of management of the family & as 'karta'. Such transfers were not only prior but also subsequent to the transaction in suit. As a witness the Plaintiff stated that he did not think it necessary to amend the plaint in the trial Court as the case was sufficiently stated in the aforesaid answers. No doubt his counsel should have been alert & applied for amendment shortly after the written statement was filed; but his inaction or negligence is not an adequate ground for refusing amendment. Necessity for amendment of pleadings frequently arises on account of blunderings of inefficient, inactive or negligent legal advisers. It would be unfair to visit the litigants invariably with the sins of omission of the members of this monopolistic profession.
The learned Counsel did not urge any substantial ground to oppose the amendment. Under Order 6, Rule 17, Code of Civil Procedure, the Court has power to allow amendment at any stage of the proceeding. The amendment was within the competence of the District Judge having regard to the terms of this rule and is not of such a character as to be objectionable either as changing the subject-matter of the suit or as being otherwise unfair. The Defendant is not prejudiced in any way. He was allowed to amend his pleading and to adduce evidence. The subject-matter of the suit is not changed in any way. In - 'Ramdhan Puri v. Lachmi Narain MANU/PR/0047/1936: AIR 1937 PC 42(D), their Lordships refused to interfere with the discretionary order of the High Court allowing in appeal amendment of the plaint in a suit by sons for setting aside the several alienations made by the father on the ground of immorality. The Plaintiff was allowed to state facts connecting the loans to immorality The Defendant was allowed to amend his written statement and to lead additional evidence. I am therefore satisfied that there is no ground to interfere with the discretionary order of the District Judge.
21-23. It is settled law that the manager of a joint Hindu family which includes minors can enter into a contract for the sale or purchase of immovable property and the contract can be specifically enforced against the family including the minors provided the transaction is for legal necessity or for the benefit of the estate. 'Ramrao v. Suganchandra AIR 1946 Nag 139(E). Relying on - 'Palaniappa Chetty v. Sreemath Devasikamony Pandara Sannadhi AIR 1917 PC 33(F), - 'MANU/TN/0211/1921 : AIR 1921 Mad 172(B) - 'Vishnu Vishwanath v. RamchandraMANU/MH/0057/1923 : AIR 1923 Bom 453(G) and - 'Hemraj Dattubuva v. Nathu Ramu MANU/MH/0009/1935 : AIR 1935 Bom 295 (FB)(H), the learned Counsel for the Defendant contends that there is no warrant in the principles of Hindu law for holding that an alienation must be treated as justified and binding on the minor members of the family because the manager considers it advantageous at the time to exchange joint family land for money. Before examining this contention it would be desirable to examine the facts of this case. (His Lordship examined the facts and showed how the transaction and the plan of the Defendant was advantageous to the joint family. His Lordship then continued) It cannot therefore be argued that the agreement to sell the plot in dispute without claiming as addition to the price, the contribution for the expenses the Defendant had to incur under the agreement Ex. P-18, is injurious to the interest of the joint family.
24. In these sale deeds the Defendant has given a warrant that he is the sole owner of the plots and that he will indemnify the purchasers if anybody makes any claim. He further admits that he has received adequate price and has benefited the estate. The learned Counsel argues that it is not the Defendant's case that these sales were imprudent transactions as he received adequate price for these sales, but in the case of the Plaintiff adequate price has not been received. Exhibit P-7 is a document signed by the Defendant some time after 16-2-1943 in which he demanded Rs. 210/- from Landge in addition to the price agreed between the parties. The price of the plot agreed to be sold to the Plaintiff was therefore inadequate, if at all, by Rs. 210/- for an area of approximately 12750 square feet. The price for this area, according to the rate agreed in the sale deed dated 15-10-1940, would be Rs. 450/- less than the price which he would get under the agreement in dispute. Even if it is assumed, contrary to the recitals in Ex. D-15 relating to the sale, that that purchaser had to pay the disputed charges in addition to the price, the transaction in suit would be more advantageous than that transaction.
25. It would be useful at this stage to examine the cases relied on by the learned Counsel. 'MANU/TN/0211/1921 : AIR 1921 Mad 172 (FB)(B)', has already been noticed. It does not help the Defendant in determining what is benefit to the estate. In - 'MANU/MH/0009/1935 : AIR 1935 Bom 295 (FB)(H)', it was held that a sale for a price higher than the market price is not in itself for the benefit of the estate. No attempt was however made to define "benefit to the estate", as it cannot be defined as observed by their Lordships of the Privy Council in - AIR 1917 PC 33 (F)'. After, referring to the earlier authorities in - Hunooman Persaud Panday v. Mt. Babooee Munraj Koonweree' 6 Moo Ind App 393 (PC) (I), - 'Prosunno Kumari Debya v. Golab Chand' 2 Ind App 145 (PC) (J) and - 'Konwar Doorganath Roy v. Ram Chunder Sen' 2 Cal 341 (PC) (K), Lord Atkinson who delivered the judgment of the Board observed:
No indication is to be found in any of them as to what is, in this connection, the precise nature of the things to be included under the description 'benefit to the estate'. It is impossible, their Lordships think, to give a precise definition of it applicable to all cases, and they do not attempt to do so. The preservation, however, of the estate from extinction, the defence against hostile litigation, affecting it, the protection of it or portions from injury or deterioration by inundation, these and such like things would obviously be benefits. The difficulty is to draw the line as to what are, in this connection, to be taken as benefits and what not.
The learned Counsel's interpretation of these observations that the act must be of defensive character cannot be accepted. In- 'MANU/MH/0057/1923: AIR 1923 Bom 453 (G)', the Court held that the sale by a manager of a joint Hindu family would not be justified merely on the ground that the sale at the time appeared to be advantageous, that is to say, that it was a sale for what appeared to be a good price. In -'Nagindas Maneklal v. Mahomed Yusuf AIR 1922 Bom 122(L), it was held that an adult coparcener very properly decided to dispose of the house which was in a dilapidated condition and which the municipal committee wanted to pull down and that the minor coparceners were bound toy the agreement.
26. No doubt, there are rival views as to what is meant by the expression "benefit to the estate". Mulla in his Hindu Law, paragraph 243A has expressed this conflict thus:
One view is that a transaction cannot be said to be for the benefit of the estate, unless it is of a defensive character calculated to protect the estate from some threatened danger or destruction. Another view is that for a transaction to be for the benefit of the estate it is sufficient if it is such as a prudent owner, or rather a trustee, would have carried out with the knowledge that was available to him at the time of the transaction.
Their Lordships in - Palaniappa Chetty v. Sree-math Devasikamony Pandara Sannadhi' (F), (supra) do not endorse the first view though it was accepted that an act of a defensive character would be for the benefit of the estate. The following observations in - Narayan Rao v. Mulchand MANU/NA/0061/1932 : AIR 1933 Nag 109(M), with which I respectfully agree, state the law on the point:
If the act for which the character of 'benefit to the estate' is claimed is of a 'defensive nature' it may give rise to a presumption in favour of the act as being beneficial: on the contrary if an act is not of a 'defensive nature', the presumption would be to the contrary so as to call ' for affirmative evidence to rebut it. The defensive nature of the act is, 'inter alia' a factor but in no event decisive or a 'sine qua non' in the consideration of the question of benefit. The distinction of acts being of 'defensive nature' or otherwise is in substance the outcome of what is conceived to be the rule of evidence drawn from human experience as to how a man with ordinary prudence would act in particular circumstances. In other words, the test to determine whether a transaction is legally necessary or beneficial is to see whether the transaction is fair and proper. In judging the validity or invalidity of alienations made by limited owners the Court has to be satisfied about the propriety of the transactions; 'legal necessity' or 'benefit to the estate' are in reality compendious expressions for a large variety of circumstances which serve to demonstrate the propriety of the transactions.
'Jagat Narain v. Mathura Das MANU/UP/0088/1928 : AIR 1928 All 454 (FB)(N), takes the same view.
27. In order to prevent the property being lost for a very paltry sum and to prevent payment of damages to the persons to whom certain plots were already sold, it was necessary for the Defendant to obtain the sanction of the Improvement Trust to the lay-out on the terms of Ex. P-18 and to sell the plots at the best possible market price. The sale of the plot to the Plaintiff was, as already shown, on more advantageous terms than the numerous transactions preceding the agreement and the transaction dated 15-10-1940. The sale in dispute is thus for the benefit of the estate. The Defendant is backing out of the agreement not because it is not for the benefit of the estate but because the prices of building plots have subsequently increased and the Defendant wants to take a dishonest advantage of that increase.
28. Lastly the learned Counsel argued that the relief of specific performance, which is in the discretion of the Court, should be refused to the Plaintiff as
(a) he has waited till almost the last day of limitation,(b) he has obtained an unfair advantage over the Defendant in obtaining the property without payment of the additional charges,(c) the act of the Defendant in agreeing to sell the property without such charges was an imprudent act prejudicial to the interest of the minor, and (d) the Plaintiff has obtained an adjudication against the minor's interest without impleading the Defendant and without giving him an opportunity to contest; the suit.
The learned Counsel invokes Section 22, Specific Relief Act and relies on - 'Dau Alakhram v. Mt. Kulwantin Bai AIR 1950 Nag 238(O). The last three contentions are without any substance whatsoever in view of the foregoing discussion and findings.
29. The suit was instituted on 30-9-43 to enforce the agreement made on 10-10-1940. No time for performance was fixed by the agreement, nor did the Defendant give any notice fixing a reasonable time after the expiration of which he would treat the contract as at an end. From the evidence on record it is abundantly clear that the Plaintiff made several attempts to get specific performance but the Defendant evaded and was demanding an additional price. Plaintiff, therefore, sent a lawyer's notice on 16-4-1942, demanding performance and reiterated the demand on 7-5-42. In view of the findings of fact in this case it is the Defendant who committed a breach of the agreement to sell the property to the Plaintiff, by his reply Ex. P-3, dated 29-4-1942. The law as to when and under what circumstances the delay is a bar to the legal remedy is very clearly laid down by Sir Barnes Peacock who delivered the judgment of the Judicial Committee in - 'Lindsay Petroleum Co. v. Hurd' (1874) LR 5 PC 221 (P) thus:
Now the doctrine of laches in Courts of Equity is not an arbitrary or a technical doctrine. Where it would be practically unjust to give a remedy, either because the party has, by his conduct, done that which might fairly be regarded as equivalent to a waiver of it, or where by his conduct and neglect he has, though perhaps not waiving that remedy, yet put the other party in a situation in which it would not be reasonable to place him if the remedy were afterwards to be asserted, in either of these cases, lapse of time and delay are most material but in every case, if an argument against relief, which otherwise would be just, is founded upon mere delay, that delay of course not amounting to a bar by any statute of limitations, the validity of that defence must be tri-ed upon principles substantially equitable. Two circumstances, always important in such cases, are, the length of the delay and the nature of the acts done during the interval, which might affect either party and cause a balance of justice or injustice in taking the one course or the other so far as relates to the remedy.
In - 'Dalton v. Angus' (1881) 6 AC 740 (Q), Lord Penzance observed at page 805:
In all the cases in which lapse of time is held to stand in the way of the assertion of rights attaching to the ownership of property, it is not the lapse of time itself which so operates but the inferences which are reasonably drawn from the continuous existence of a given state of things during that period of time. These inferences are inferences of acquiescence or consent....
30. In his original written statement or in the amended written statement the Defendant has not alleged any facts from which the inference of the acquiescence or consent of the Plaintiff to the breach of the contract by the Defendant could be reasonably drawn. Nor has the learned Counsel been able to draw my attention to any such circumstances. It is clear that the Defendant has done nothing since May 1942 to his prejudice regarding the plot in dispute, nor has the Plaintiff neglected to do anything which he was bound by law to do, nor did he give any indication leading the Defendant to believe that he had abandoned the contract. 'Dau Alakhram v. Mt. Kulwantin Bai' (O), (supra) is not an authority for the proposition that the relief of specific performance, though otherwise good, should be refused merely because a suit was instituted about 15 months after the breach of the agreement by the Defendant. In the instant case the Plaintiff has alleged and was always ready and willing to carry out the agreement Ex. P-1 read with Ex. D-5. The Defendant has not alleged nor has he proved that he was not so ready and willing. Of course, he was not willing to pay the additional charges wrongly demanded by the Defendant, but that does not mean that he was not ready and willing to carry out the agreement between the parties. In the case cited by the learned Counsel, the Defendant had averred that she was ready and willing all along to sell the property and perform her part of the contract and that it was the Plaintiff who avoided the performance of his part thereof still the Plaintiff did not aver though he filed a further statement that he was ready and willing to perform his part of the contract; nor did he place before the Court any material to prove such readiness and willingness. For the reasons already stated, it would be highly inequitable to refuse the Plaintiff in the instant case specific of the agreement and to help the dishonest Defendant to escape his legal liability.
31. I therefore uphold the decision of the lower appellate Court and dismiss the appeal with costs. Counsel's fee as certified.
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