A minor, who repudiates an alienation of his property by a
defacto guardian, is not bound to restore the benefits derived by him, if the
purchaser was aware of the fact of his minority and the minor was not guilty
of any fraud, misrepresentation, etc. In such cases, the purchaser cannot
claim any relief against the minor - either personal or against his property.
The defacto guardian may be liable personally and out of his properties for
dealing with a Hindu minor's property in contravention of Section 11 of the
Act 1956 depending on the terms in the document concerned.
By no
stretch of reasoning, it can be held that the property shown as security in
the failed deed of alienation will automatically get transferred to the
purchaser the moment the document is declared void.
Therefore, the
remedy of defendants 1 and 2, if at all is only to proceed against the defacto
guardian, viz., the 3rd defendant, subject to the terms in Ext.A2 and the
sanction of law.
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
MR. JUSTICE A.HARIPRASAD
6TH DAY OF APRIL 2015
RSA.No. 885 of 2006
MANIYAN NADAR,
Vs
HARIKUMAR KUNJIRAMAN NAIR
Citation;AIR 2015 Kerala183
Common substantial questions of law arising in the appeals
are the following:
i.
Is a minor, who repudiates an alienation of his property by a
defacto guardian, always bound to restore the benefits derived by him?
ii.
Is the minor under all circumstances liable to compensate the
purchaser of property, either personally or out of his assets, in the event he
succeeds in establishing that the alienation is void?
iii.
What is the liability of the defacto guardian who represented
the minor in the document of alienation?
iv.
Is the purchaser entitled to claim title to a property purchased
in the name of the minor by utilizing the sale consideration provided by the
former?
For the sake of convenience, R.S.A.No.626 of 2009 is taken as the leading
case, which is the appeal against O.S.No.338 of 1987. The parties and
documents are hereinafter referred to in the rank in the above suit.
2.
Facts, in nut shell: O.S.No.338 of 1987 on the file of the
Additional Munsiff's Court, Nedumangad is a suit for declaration that Ext.A2
sale deed executed by the 3rd defendant, who is the sister of the quondam
minor plaintiff, in favour of defendants 1 and 2 is void and also to allow the
plaintiff to recover possession of the plaint schedule property from
defendants 1 and 2. The suit was decreed. Against the judgment and
decree, the defendants 1 and 2 preferred A.S.No.635 of 1990 before the
District Court, Thiruvananthapuram. Learned Additional District Judge after
a detailed consideration, dismissed the appeal confirming the judgment
and decree of the trial court.
Against that judgment and decree,
defendants 1 and 2 have come up in R.S.A.No.626 of 2009.
3.
After putting the decree in O.S.No.338 of 1987 to execution
and also after taking delivery of the property by the plaintiff, defendants 1
and 2 preferred O.S.No.197 of 1999 before the learned Principal Munsiff,
Nedumangad. In that suit, the plaintiff in O.S.No.338 of 1987 is the 1st
defendant and his sister (3rd defendant in the earlier suit) is the 2nd
defendant.
This suit is one for recovery of possession of B schedule
property in Ext.A2 document impugned in the former suit.
4.
Plaintiff
filed
O.S.No.338
of
1987
challenging
Ext.A2
document, executed admittedly during his minority. In the document itself,
he is shown as a person aged 15 years at the time of its execution and he
was represented by his sister, who was not the natural guardian under the
provisions of the Hindu Minority and Guardianship Act, 1956 (in short, “the
Act 1956”). There cannot be any dispute that Ext.A2 executed by the 3rd
defendant, acting as guardian of the plaintiff, is void under Section 11 of
Act 1956. Therefore, defendants 1 and 2 in the suit were defenceless
against the reliefs claimed in the suit, viz., declaration of title of the plaintiff
over the property and recovery of possession of the property from
defendants 1 and 2.
It is an admitted case that the minor plaintiff, in
execution of the decree, got possession of the property shown in the plaint
schedule in O.S.No.338 of 1987. Thereafter, the defeated defendants filed
O.S.No.197 of 1999 seeking reliefs against another property, shown in
Ext.A2 document. According to the defendants, (plaintiffs in O.S.No.197 of
1999), the property described as item No.2 in Ext.A2 is the property given
as security for safeguarding their interests, in case the minor challenged
the transaction a later point of time. The trial court dismissed the suit
finding that remedy available to the defendants was only to mitigate loss
sustained by them by taking recourse to the indemnity clause in Ext.A2
assignment deed and to proceed against the 3rd defendant for realising
compensation. It was also found that by operation of law, the plaintiff
cannot claim title to the property shown as item No.2 in Ext.A2 assignment
deed. In effect, the defendants not only suffered a set back in the suit filed
by the plaintiff for a declaration and recovery of possession, but also lost
their suit seeking a claim over item No.2 in Ext.A2 assignment deed.
5.
Heard Shri K.B.Pradeep, learned counsel for the appellants
(defendants 1 and 2) and Shri G.S.Reghunath, learned counsel for the
respondent (plaintiff).
6.
At the outset, I shall refer to the terms in Ext.A2 assignment
deed executed by the 3rd defendant on her own and also on behalf of her
minor brother (plaintiff) in respect of a property, which undisputedly
belonged to the minor. It is mentioned in Ext.A2 that mother of the minor
and the 3rd defendant had expired and their father had abandoned them. It
is specifically mentioned in the document that item No.1 exclusively
belonged to the minor and it was assigned to defendants 1 and 2 by the 3rd
defendant as defacto guardian of the minor.
In the latter part of the
document, it is mentioned that the property shown as item No.2 and a
house therein exclusively belonged to the 3rd defendant. It is relevant to
note that Ext.A2 bears a number 1880 of 1982, SRO, Kattakkada. From
Ext.A2, it can be seen that another document bearing No.1879 of 1982 of
the same SRO was executed on the same date by the 3rd defendant in
favour of the plaintiff in respect of half right over item No.2 in Ext.A2
document. As per the averments in Ext.A2, the consideration received by
the 3rd defendant by selling minor's property (item No.1 in Ext.A2) was
utilised for assigning half right of the 3rd defendant over item No.2 in Ext.A2
as per document No.1879 of 1982 in favour of the plaintiff. Interestingly,
that document was not produced by any of the parties to the suits. As per
the recitals in Ext.A2, a charge was created over item No.2 therein for any
possible future claims by the quondam minor in respect of item No.1. It is
also relevant to note that when examined, the plaintiff deposed that he
never made any claim in respect of item No.2 in Ext.A2 and he insisted on
getting back item No.1 in Ext.A2, which was assigned away during his
minority without the sanction of law.
7.
In these factual settings, the matter will have to be decided.
Shri K.B.Pradeep contended on behalf of the appellants (defendants 1 and
2) that the erstwhile minor plaintiff cannot be allowed to unjustly enrich
himself by recovering the property sold for valid consideration during his
minority and also by allowing him to retain another property, purchased in
his name during minority by utilising the sale consideration.
Shri
K.B.Pradeep further contended that it is not only inequitable, but also in
contravention of the provisions in the Indian Contract Act. In reply to this
argument, Shri G.S.Reghunath, learned counsel for the plaintiff submitted
that the minor at no point of time, staked any claim over item No.2 in
Ext.A2. He deposed in the suit clearly expressing his disconnect with item
No.2 in Ext.A2.
According to the plaintiff, he is not interested in any
property transferred by his sister to his name by utilising the sale
consideration mentioned in Ext.A2 document. It is also contended that
sister was actually acting against his interest at the time when Ext.A2 was
executed. Section 8 of the Act 1956 deals with the powers of a natural
guardian of Hindu minor. According to Section 6 of the Act 1956, in the
case of a Hindu minor, who is a boy or an unmarried girl, the father and
after him, the mother shall be the natural guardians and they can act
subject to the restrictions mentioned in the Section.
At any rate, 3rd
defendant sister cannot be treated as natural guardian of the plaintiff.
Section 8 of the Act 1956 has no application to the facts of this case.
Section 11 of the Act 1956 says that after commencement of the Act, no
person shall be entitled to dispose of or deal with the property of a Hindu
minor merely on the ground of his or her being the defacto guardian of the
minor. 3rd defendant, at the maximum, could have claimed that she was
the defacto guardian of the erstwhile minor. Even in that situation, she
could not have dealt with the property of the plaintiff during his minority.
The Supreme Court in the decisions in Vishwambhar and others v.
Laxminarayan (dead) through Lrs. and another (AIR 2001 SC 2607)
and Nagappan v. Ammasai Gounder and others ((2004) 13 SCC 480)
has clearly held that a sale effected without taking permission of the court
and without any legal necessity is voidable at the instance of the minor and
the minor is expected to get the alienation set aside, if he wanted to avoid
the transfer and recover property from the purchasers. This is in a typical
situation when the alienation was made by a natural guardian in
contravention of the provisions in Section 8 of the Act 1956. But, in the
case of an alienation made by a defacto guardian, the prohibition in Section
11 of the Act of 1956 is attracted and the transaction becomes void abinitio
and per se invalid. The Supreme Court in Madhegowda (dead) by Lrs. v.
Ankegowda (dead) by Lrs. and others (AIR 2002 SC 215) held that the
transferee in such a case acquires no interest and the alienation does not
require to be set aside by means of a suit. It has been observed that the
law in certain terms prohibit any transfer of any part of a minor’s estate by a
defacto guardian. Question of legal necessity has no relevance in such
transfers.
Therefore, it is unchallengeable that Ext.A2 is void abinitio.
Learned counsel for the appellants (defendants 1 and 2) therefore rightly
contended that he limits his claim in these appeals to the disgorging of
benefits accrued to the minor from out of Ext.A2 transaction.
8.
If that be so, the question arising for consideration is whether
the minor can be compelled to disgorge the benefits reaped by him on
account of the impugned transaction.
Learned counsel for the plaintiff
contended that defendants 1 and 2 neither in O.S.No.338 of 1987 nor in
O.S.No.197 of 1999, raised a claim against the minor for disgorging the
benefits. Instead, they in their suit claimed title in respect of item No.2 in
Ext.A2 by operation of law. The plaintiff, during his minority, obtained half
right over item No.2 in Ext.A2 as per document No.1879/1982 executed by
the 3rd defendant. No legal provision could be shown by the learned
counsel for defendants 1 and 2 to support a contention that immediately on
upholding the quondam minor's challenge against alienation of his
property, title in respect of a property purchased in the name of the minor
by utilizing the sale consideration would vest with the purchaser of minor’s
property. In otherwords, without taking proper recourse to law, how could
defendants 1 and 2 lay a claim over item No.2 in Ext.A2 has not been
established. Similarly, in the case of defacto guardian's share in item No.2
in Ext.A2 also, a proper legal proceedings should be initiated by
defendants 1 and 2 to claim title. No provision of law could be shown to
uphold the contention of the plaintiffs in O.S.No.197 of 1999.
9.
According to Shri K.B.Pradeep, Sections 64 and 65 of the
Contract Act command the plaintiff to disgorge the benefits derived out of
Ext.A2 transaction.
Section 64 of the Contract Act deals with the
consequences of rescission of a voidable contract.
Ext.A2 transaction,
executed by a defacto guardian of a Hindu minor, that too without any
sanction from a court, is void abinitio. That proposition is now well settled.
Therefore, Section 64 of the Contract Act per se has no application.
10.
Section 65 of the Contract Act reads as follows:
“Obligation of person who has received
advantage under void agreement, or contract
that
becomes
void.-When
an
agreement
is
discovered to be void, or when a contract becomes
void, any person who has received any advantage
under such agreement or contract is bound to
restore it, or to make compensation for it to the
person from whom he received it.”
The relevant question is whether the plaintiff, in the admitted facts and
circumstances of this case, is bound to restitute the benefits derived by him
on account of Ext.A2 transaction.
The precedents on the question of
minor's responsibility to restitute the benefits derived from a transaction
which was later found to be void are not uniform. It is most relevant to
remember that the precedents on any question of law should be applied
with utmost regard to the facts and circumstances in each case.
11.
The law stated in Section 65 of the Contract Act is one
touching the principle of restitution.
The Section visualises two
contingencies. First one, after a benefit has been received by one party,
the agreement is discovered to be void later. Second one, the contract
becomes void by subsequent happenings.
The Section is intended to
prevent unjust enrichment. Privy Council in Muralidhar Chatterjee v.
International Film Co. Ltd. (AIR 1943 PC 34) held that this Section is not
wider in scope than the prevalent English doctrine of restitution. It is further
held that the courts in India are, however, governed by the principles in
Section 65 of the Contract Act and not by any principle enunciated by the
English Courts. If the plaintiff can bring his case within the four corners of
this Section, he will be entitled to the remedies, viz., compensation,
notwithstanding any principle of the English Law to the contrary. None of
the parties to this case has a contention that Ext.A2 assignment deed
became void subsequent to the plaintiff's reception of the benefit, viz.,
reception of consideration for sale. Hence the first limb of Section 65 of the
Act is not applicable to this case. Similarly, defendants 1 and 2 never
raised contentions that they were not aware of minority of the plaintiff at the
time of execution of Ext.A2 and it was discovered only subsequent to the
transaction. In fact, in Ext.A2 itself, minority of the plaintiff has been clearly
spelt out. Therefore, on the settled legal principles, it can only be seen that
Ext.A2 is void abinitio. Hence, the second limb of the Section is also not
applicable to this case. The expression 'discovered to be void' had been
interpreted to mean an agreement though void abinitio, but that was not
known to be so by the parties. Sections 32 and 56 of the Contract Act deal
with two situations where a contract becomes void subsequent to its
execution.
Section 32 of the Contract Act deals with enforcement of
contracts contingent on an event happening. Such contracts cannot be
enforced in law, unless and until that event had happened and if the event
becomes impossible, such contracts become void.
Section 56 of the
Contract Act deals with an agreement to do an impossible act. Second part
of Section 56 of the Contract Act speaks about the contracts to do an act
which afterwards becoming impossible or unlawful.
In that event, the
contract becomes void when the act becomes impossible or unlawful.
These are some situations wherein the contract becomes void subsequent
to its execution. Facts admitted in this case will clearly show that none of
these situations exist. Hence in my view, Section 65 of the Contract Act
cannot be applied to this case.
12.
In addition to that, the law declared by the Apex Court in Kuju
Collieries Ltd. v. Jharkhand Mines Ltd. and others (AIR 1974 SC 1892)
throws considerable light on the interpretation of Section 65 of the Contract
Act. It reads as follows:
“The section makes a distinction between an
agreement and a contract. According to Section 2
of the Contract Act an agreement which is
enforceable by law is a contract and an agreement
which is not enforceable by law is said to be void.
Therefore, when the earlier part of the section
speaks of an agreement being discovered to be
void it means that the agreement is not enforceable
and it, therefore, not a contract. It means that it was
void. It may be that the parties or one of the parties
to the agreement may not have, when they entered
into the agreement, known that the agreement was
in law not enforceable. They might have come to
know later that the agreement was not enforceable.
The second part of the section refers to a contract
becoming void. That refers to a case where an
agreement which was originally enforceable and
was, therefore, a contract, becomes void due to
subsequent happenings. In both these cases any
person who has received any advantage under
such agreement or contract is bound to restore
such advantage, or to make compensation for it to
the person from whom he received it. But where
even at the time when the agreement is entered
into both the parties knew that it was not lawful
and, therefore, void, there was no contract but only
an agreement and it is not a case where it is
discovered to be void subsequently. Nor is it a case
of the contract becoming void due to subsequent
happenings. Therefore, Section 65 of the Contract
Act did not apply.”
13.
In search of an answer to the question posed, I traced a long
line of precedents. In Mohori Bibee v. Dharmodas Ghose (Vol.XXX ILR
Calcutta 539) the Privy Council held that a contract entered into between a
sui juris and a minor is void, but no definite answer was given as to
whether a minor was bound to restore the benefits derived by him in the
transaction. It was observed that Sections 64 and 65 of the Contract Act,
being based on there being a contract between competent parties, are
inapplicable to a case where there is not, and could not have been, any
contract at all. Subsequently the Privy Council in Nawab Sadiq v. Jai
Kishori (55 MLJ 88 (PC)) held in clear terms that a contract entered into
between a major and a minor is a nullity. Calcutta High Court in Hari
Mohan v. Dulu Miya (AIR 1935 Calcutta 198) held that if a person
entering into a transaction was not aware of the fact of minority and there
was some representation by the minor as to his age with a view to deceive
the other party, the right of restitution can be claimed against him. But, in
this case, it is clear from Ext.A2 itself that the plaintiff was shown as a
minor aged 15 years. Hence, the principle in that decision is not applicable
to this case.
14.
Division Bench of the Andra Pradesh High Court in Gokeda
Lateharao v. Viswanadham Bhimayya (AIR 1956 A.P. 182) considered in
detail about the legal responsibility of a minor, who borrowed money on the
basis of promissory notes.
The appellant in that case executed two
promissory notes during his minority.
It was alleged that he made a
fraudulent representation to the respondent as to his age and claimed to be
a major. When a suit was filed to recover money, the appellant, inter alia,
contended that the promissory notes were not supported by consideration
and also that they were executed during his minority and hence void.
Learned Judges considered the question and summarised the law as
follows:
““43. The law may be briefly summarised. A
contract entered into with a minor is a nullity for
want of legal
competency.
Except otherwise
provided by statute, it is not enforceable and it
does not give rise to any rights or liabilities.
44.
It is non est. It follows from this legal
position that a person, who parted with his goods
can trace them into the hands of the quondam
minor and recover them back in specie, for he has
not lost his title to them. But he cannot seek to
recover their price or damages for, if allowed, he
would be indirectly asking for the enforcement of
the contract and to recover damages for the
breach. Nor can a person who lends money to
such a minor, recover it. If allowed to do so, the
Court would be enforcing a contract of loan. The
English
decisions
graphically
describe
this
position as “restitution stops where repayment
begins”. ........”
15.
It was also observed that by applying the principle of equity, the
court could refuse relief to a quondam minor, if he seeks relief on the basis
of a void contract and if he derived any benefit by a fraudulent
representation. That principle is also not applicable to this case, as there is
no contention raised by defendants 1 and 2 that the minor reaped the
benefits by extending a fraudulent representation.
It was observed in
Gokeda Lateharao's case (supra) that it is not permissible to invoke other
equitable principles, which would tend to make the legal provisions
nugatory. Their Lordships following the observations in Mohori Bibee's
case held that the law in Section 65 of the Contract Act cannot be invoked
as it pre-supposes the existence of a contract between persons with legal
competency. I am in respectful agreement with the view taken therein.
16.
Learned counsel for defendants 1 and 2 relied on a decision of
this Court rendered by a learned Single Judge in Chacko v. Sreeja (1991
(1) KLT 191) to contend a proposition that a minor is liable to disgorge
benefits obtained through a transaction which he lawfully avoided. In
Chacko's case, the predominant question was regarding the legal
competence of the appointed guardian to challenge an alienation during
minority of her ward. In otherwords, it was contended that only the minor
could have avoided the transaction and not a guardian during the minority
of the ward. The facts therein would show that mother of the minor got
herself appointed through District Court guardian of her daughter on
establishing that the minor's father was a drunkard and a spend-thrift. In
the meantime, minor's father sold out certain properties belonging to the
minor for consideration acting as natural guardian.
Subsequent to the
appointment of mother as guardian, she challenged the alienations
contending that the assignments were made in violation of Section 8(2) of
the Act 1956. The first question raised was regarding the competency of
the guardian to challenge the alienation during minority of the ward. After
considering the law on the point, learned Single Judge held that the
guardian is also competent to challenge the alienation made by a natural
guardian without fulfilling the conditions under the Act 1956.
The
transaction was voidable as per Section 8 of the Act 1956. This Court in
Chacko's case considered the scope of Section 64 of the Contract Act to
hold that a minor, who derived any benefit, is bound to restore the benefit to
the person from whom it was received. Glaring differences in the facts and
the law applicable would make it clear that the ratio in that decision is not
applicable as such to the case in our hand.
17.
Learned Directors of the Kerala Judicial Academy on my
request pointed out two decisions of this Court touching the subject. Assiya
v. Rajeevan and another (1993 KHC 245) and Padinhare Veettil Madhavi
v. Pachikaran Veettil Balakrishnan and another (2009 KHC 989) deal
with the legal effect of challenges made by minors against alienations by
mothers during their minority. In both these cases, the property involved in
dispute belonged to Hindu minors and, therefore, the provision in Section 8
of the Act 1956 was applicable. As mentioned earlier, on account of the
binding pronouncements by Apex Court on this subject, it can only be seen
that the transactions impugned in both these cases were voidable at the
option of the minors. But, the facts in our case deal with a situation where
the transaction is void at its inception.
18.
Law in Section 33 of the Specific Relief Act, 1963 (in short, “the
Act 1963”) may be relevant in this context. It reads as follows:
“Power to require benefit to be restored or
compensation to be made when instrument is
cancelled or is successfully resisted as being
void or voidable.-(1) On adjudging the cancellation
of an instrument, the Court may require the party to
whom such relief is granted, to restore, so far as may
be, any benefit which he may have received from the
other party and to make any compensation to him
which justice may require.
(2) Where a defendant successfully resists any suit
on the ground-
(a) that the instrument sought to be enforced against
him in the suit is voidable, the Court may if the
defendant has received any benefit under the
instrument from the other party, require him to
restore, so far as may be, such benefit to that party
or to make compensation for it;
(b) that the agreement sought to be enforced against
him in the suit is void by reason of his not having
been competent to contract under Sec.11 of the
Indian Contract Act, 1872 (9 of 1872), the Court may,
if the defendant has received any benefit under the
agreement from the other party, require him to
restore, so far as may be, such benefit to that party,
to the extent to which he or his estate has benefited
thereby.”
For completeness of discussion, I may refer to Section 31 of the Act 1963
too. It deals with cancellation of instruments and when cancellation may be
ordered. On a reading of the Section, it is clear that a void or voidable
document can be sought to be cancelled. Any person having reasonable
apprehension that if a written instrument, which is void or voidable, if left
outstanding may cause serious injury, then he may sue to have it adjudged
void or voidable. In that event, the court has the discretion so to adjudge
and it can even order the instrument to be delivered up and cancelled. The
term “adjudge” has been defined in Black's Law Dictionary as (1) adjudicate
(2) to deem or pronounce to be (3) to award judicially.
To adjudge a
document void or voidable, the court will have to go into that question on
the basis of the evidence and law. Section 33 of the Act 1963 empowers the
court to direct a party to restore benefit or to compensate the party against
whom a relief is granted under Section 31 of the Act 1963. If one reads
Section 33(1) of the Act 1963 carefully, one can see expressions like “court
may require the party to restore benefit”, “restore benefit so far as may be”
etc. All these expressions indicate the vast extent of discretion vested in
the court to direct restoration of any benefit earned by a plaintiff, in a case in
which the defeated party deserves an equity to be done in his favour.
19.
On a reading of Section 33 of the Act 1963 quoted above and
the reasons for the change suggested by the Law Commission at the time
when the Act 1963 was made, it would be clear that Section 31 of the Act
1963 refers both to void and voidable contracts and Section 33 of the Act
1963 gives the court a power to award compensation on adjudging
cancellation of an instrument, which is to be done under Section 31 of Act
1963. A statement that reliefs claimable under the Act 1963 are based on
equitable principles and grounds is unchallengeable.
Even declaratory
claim in a suit, falling under Section 34 of Act 1963, is a discretionary relief.
A reading of Section 34 would make it clear that any person entitled to any
legal character or to any right as to any property may institute a suit against
any person denying or interested to deny his title to such character or right.
In that event the court, in its discretion, may make a declaration to meet the
ends of justice. In this case, the plaintiff sought for a declaratory relief that
Ext.A2 deed, insofar as his property is concerned, is void abinitio. Without
any iota of doubt, it has to be held that the plaintiff is entitled to get the
declaration sought for and the only question is whether the court could
apply equitable principles and direct the plaintiff to restore benefits derived
out of the transaction.
20.
Coming back to the law laid down in Asssiya and Padinhare
Veettil Madhavi's cases mentioned supra, with due respect, I may mention
that in those decisions the nuances or intricacies of Section 65 of the
Contract Act were not considered. Further, the legal implication in applying
the law in Section 33 of the Act 1963 to a case where the purchaser
knowing fully well at the time of purchase that the property belonged to a
minor was not considered. In our case, defendants 1 and 2 were fully
aware of the fact that item No.1 in Ext.A2 belonged to the quondam minor.
Insistence by them for having an indemnity clause in the document and
showing another property in the same document as security for meeting the
probable future claim by minor are indications of their consciousness about
the danger of purchasing property from a minor. Reckoning the visible
difference in facts and non-consideration of the legal principles in Section
65 of the Contract Act, I am of the view that the decisions in Assiya and
Padinhare Veettil Madhavi's cases can be easily distinguished.
That
apart, the observation in Padinhare Veettil Madhavi's case that even if the
transaction is void, the minor seeking to set it aside cannot claim
interference of a court of law without making restitution is too general a
statement which cannot be applied to all situations. This is evident from the
phraseology employed in Section 33 of the Act 1963 itself. This is all the
more clear if we recollect the law laid down in Mohori Bibee, Kuju
Collieries Ltd. and Gokeda Lateharao's cases mentioned above. I am of
a definite view that a person, who purchases property with full knowledge
that it belonged to a minor and the defacto guardian was incompetent to
deal with minor's property by virtue of Section 11 of Act 1956, cannot claim
equity in his favour to be worked out against the quondam minor. It may be
true that the defacto guardian may be liable to compensate the purchaser
as one may find personal covenants binding the defacto guardian and
creation of charge on another property for securing the price paid. But
creation of charge on minor's assets cannot be made or enforced under all
circumstances as a general rule without regard to the facts in each case.
The legal questions framed can be answered by summing up the discussion
as follows:
A minor, who repudiates an alienation of his property by a
defacto guardian, is not bound to restore the benefits derived by him, if the
purchaser was aware of the fact of his minority and the minor was not guilty
of any fraud, misrepresentation, etc. In such cases, the purchaser cannot
claim any relief against the minor - either personal or against his property.
The defacto guardian may be liable personally and out of his properties for
dealing with a Hindu minor's property in contravention of Section 11 of the
Act 1956 depending on the terms in the document concerned.
By no
stretch of reasoning, it can be held that the property shown as security in
the failed deed of alienation will automatically get transferred to the
purchaser the moment the document is declared void.
Therefore, the
remedy of defendants 1 and 2, if at all is only to proceed against the defacto
guardian, viz., the 3rd defendant, subject to the terms in Ext.A2 and the
sanction of law. The appeals are devoid of any merit. Hence, they are
dismissed.
All pending interlocutory applications will stand dismissed.
A. HARIPRASAD, JUDGE.
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