Balmukand Vs. Kamla Wati & Ors
 INSC 16 (27 January 1964)
27/01/1964 MUDHOLKAR, J.R.
CITATION: 1964 AIR 1385 1964 SCR (6) 321
E 1978 SC 300 (8) D 1980 SC 645 (5)
Contract by manager to sell joint
property--Specific Performance when ordered--Hindu Law--Joint family.
The appellant entered into a contract with
the karta for the purchase of property belonging to a joint Hindu family.
This property consisted of a fractional share
belonging to the family in a large plot of land. Earnest money was paid to the
karta. As the karta did not execute the sale deed the appellant instituted a
suit for specific performance.
The other members who are the brothers of the
karta and who were adults (1) A.I.R. 1962 Raj 3.
(2) 1959 All. L.J. 340.
134--159 S.C.--21 322 at the time of the
contract were also impleaded in the suit as defendants. The suit was resisted
on the ground that there was no legal necessity and that the contract for sale
was not for the benefit of the family. The trial court as well as the High
Court upheld these contentions.
Before this Court it was contended that even
though there was no legal necessity the transaction was for the benefit of the
family which the karta as a prudent owner was entitled to enter into for the
benefit of the family.
Held:(i) For a transaction to be regarded as
one which is of benefit to the family it need not necessarily be only of a
defensive character, but what transactions would be for the benefit of the
family would depend on the facts and circumstances of each case. In each case
the Court must be satisfied from the material before it that it was in fact
such as conferred or was necessarily expected to confer benefit on the family
at the time it was entered into.
(ii) No part of the joint family property
could be parted with or agreed to be parted with by the manager on the ground
of alleged benefit to the family when the transaction is opposed by the adult
members of the family.
(iii)In the present case the appropriate
pleas were not raised by the plaintiff nor the necessary evidence led. The
granting of specific performance is always in the discretion of the court. In
the facts and circumstances of the case the courts below were justified in
refusing to order specific performance and the appeal is dismissed.
Jagatnarain v. Mathura Das, I.L.R. 50 All.
969, Honooman Prasad Pandey v. Babooee Munraj Koonwaree, (1856) 6 Moo.
I.A. 393 Sahu Ram Chandra v. Bhup Singh,
I.L.R. 39 All. 437, Palaniappa Chetty v. Sreemath Daiyasikamony Pandara
Sannadhi, 44 I.A. 147, Sital Prasad Singh v. Ajablal Mander, I.L.R. 18 Pat. 306
and In the matter of A. V. Vasudevan & Ors. Minors. A.I.R. 1949 Mad. 260.
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 7 of 1962.
Appeal from the judgment and decree dated
October 14, 1957 of the Punjab High Court in R.F.A. No. 219 of 1950.
N. C. Chatterjee, H. L. Mittal, S. S.
Khanduja and Ganpat Rai, for the appellant.
Ram Lubhaya and S. D. Sekhri, for respondents
S. K. Mehta and K. L. Mehta, for respondents
323 January 27, 1964. The Judgment of the
Court was delivered by MUDHOLKAR J.-This is a plaintiff's appeal from the
dismissal of his suit for specific performance of a contract for the sale of
3/20th share of land in certain fields situate in Mauza Faizpur of Batala in
the State of Punjab. He had instituted the suit in the court of Sub-Judge,
First Class, Batala, who dismissed it in its entirety. Upon appeal the High
Court of Punjab, while upholding the dismissal of the plaintiff's claim for
specific performance, modified the decree of the trial court in regard to one
matter. By that modification the High Court ordered the defendants to repay to
the plaintiff the earnest money which he had paid when the contract of sale was
entered into by him with Pindidas.
It may be mentioned that Pindidas died during
the pendency of the appeal before the High Court and his legal representatives
were, therefore, substituted in his place.
Aggrieved by the dismissal of his claim for
specific performance the plaintiff has come up to this Court by a certificate
granted by the High Court, under Art. 133 of the Constitution.
The relevant facts are these:
The plaintiff owned 79/120th share in Kasra
Nos. 494, 495, 496, 497, 1800/501, 1801/501 and 529 shown in the zamabandi of
1943-43, situate at Mauza Faizpur of Batala. On October 1, 1943 he purchased
23/120th share in this land belonging to one Devisahai. He thus became owner of
17/20th share in this land. The remaining 3/20th share belongs to the joint
Hindu family of which Pindidas was the Manager and his brother Haveliram
Khemchand and Satyapal were the members.
According to the plaintiff he paid Rs. 175
per marla for the land which he purchased from Devisahai. In order to
consolidate his holding, the plaintiff desired to acquire the 3/20th share held
by the joint family of Pindidas and his brothers. He, therefore, approached
Pindidas in the matter and the latter agreed to sell the 3/20th share belonging
to the family at the rate of Rs. 250 per marla.The contract in this regard was
entered into on October 1, 324 1945 with Pindidas and Rs. 100 were paid to him
as earnest money. As the manager of the family failed to execute the sale deed
in his favour, the plaintiff instituted the suit and made Pindidas and his
brothers defendants thereto.
The suit was resisted by all the defendants.
Pindidas admitted having entered into a contract of sale of some land to the
plaintiff on October 1, 1945 and of having received Rs. 100 as earnest money.
According to him, however, that contract pertained not to the land in suit but
to another piece of land. He further pleaded that he had no right to enter into
a contract on behalf of his brothers who are defendants 2 to 4 to the suit and
are now respondents 13 to 15 before us. The defendants 2 to 4 denied the
existence of any contract and further pleaded that even if Pindidas was proved
to be the karta of the joint family and had agreed to sell the land in suit the
transaction was not binding upon them because the sale was not for the benefit
of the family nor was there any necessity for that sale. The courts below have
found in the plaintiff's favour that Pindidas did enter into a contract with
him for the sale of 3/20th share of the family land in suit and received Rs.
100 as earnest money.
But they held that the contract was not
binding on the family because there was no necessity for the sale and the
contract was not for the benefit of the family.
It is not disputed before us by Mr. N. C.
Chatterjee for the plaintiff that the defendants are persons in affluent circumstances
and that there was no necessity for the sale.
But according to him, the intended sale was
beneficial to the family inasmuch as it was not a practical proposition for the
defendants to make any use of their fractional share in the land and,
therefore, by converting it into money the family stood to gain. He further
pointed out that whereas the value of the land at the date of the transaction
was Rs. 175 per marla only the plaintiff had agreed under the contract to
purchase it at Rs. 250 per marla the family stood to make an additional gain by
the transaction. The substance of his argument was that the Manager of a joint
325 Hindu family has power to sell the family property not only for a defensive
purpose but also where circumstances are such that a prudent owner of property
would alienate it for a consideration which he regards to be adequate.
In support of his contention he has placed
reliance on three decisions. The first of these is Jagatnarain v. Mathura
Das(1). That is a decision of the Full Bench of that High Court in which the
meaning and implication of the term "benefit of the estate" is used
with reference to transfers made by a Manager of a joint Hindu family was
The learned Judges examined a large number of
decisions, including that in Hanooman Persaud Pandey v. Babooee Munraj
Koonweree(2); Sahu Ram Chandra v. Bhup Singh(3) and Palaniappa Chetty v.
Sreemath Daivasikamony Pandra Sannadhi(4) and held that transactions
justifiable on the principle of benefit to the estate are not limited to those
which are of a defensive nature. According to the High Court if the transaction
is such as a prudent owner of property would, in the light of circumstances
which were within his knowledge at that time, have entered into, though the
degree of prudence required from the manager would be a little greater than
that expected of a sole owner of property. The facts of that case as found by
the High Court were:
"........ the adult managers of the
family found it very inconvenient and to the prejudice of the family's
interests to retain property, 18 or 19 miles away from Bijnor, to the
management of which neither of them could possibly give proper attention, that
they considered it to the advantage of the estate to sell that property and
purchase other property more accessible with the proceeds, that they did in
fact sell that property on very advantageous terms, that there is nothing to
indicate that the transaction would not have reached a profitable conclusion .
. ." (P. 979).
(1) I.L.R. 50 All. 969. (2)(1816) 6 Moo.
(3) I.L.R. 39 All 437. (4)44 I.A.147.
326 We have no doubt that for a transaction
to be regarded as one which is of benefit to the family it need not necessarily
be only of a defensive character. But what transaction would be for the benefit
of the family must necessarily depend upon the facts of each case. In the case
before the Full Bench the two managers of the family found it difficult to
man-age the property at all with the result, apparently, that the family was
incurring losses. To sell such property, and that too on advantageous terms,
and to invest the sale proceeds in a profitable way could certainly be regarded
as beneficial to the family. In the present case there is unfortunately nothing
in the plaint to suggest that Pindidas agreed to sell the property because he
found it difficult to manage it or because he found that the family was
incurring loss by retaining the property. Nor again is there anything to
suggest that the idea was to invest the sale proceeds in some profitable
manner. Indeed there are no allegations in the plaint to the effect that the
sale was being contemplated by any considerations of prudence and that is said
is that the fraction of the family's share of the land owned by the family bore
a very small proportion to the land which the plaintiff held at the date of the
transaction. But that was indeed the case even before the purchase by the
plaintiff of the 23/120th share from Devisahai. There is nothing to indicate
that the position of the family vis-a-vis their share in the land had in any
way been altered by reason of the circumstance that the remaining 17/20th
interest in the land came to be owned by the plaintiff alone. Therefore, even
upon the view taken in the Allahabad case the plaintiff cannot hope to succeed
in this suit.
The next case is Sital Prasad Singh v.
Ajablal Mander(1) That was a case in which one of the questions which arose for
consideration was the power of a manager to alienate part of the joint family
property for the acquisition of new property. In that case also the test
applied to the transaction entered into by a manager of a joint Hindu family
was held to be the same, that is, whether the transaction was one into which a
prudent owner would enter in the ordinary (1) I.L.R. 18 Pat. 306.
327 course of management in order to benefit
Following the view taken in the Allahabad
case the learned Judges also held that the expression "benefit of the
estate" has a wider meaning than mere compelling necessity and is not
limited to transactions of a purely defensive nature.
In the course of his judgment Harries C.J.
observed at p.
". . . . . the karta of a joint Hindu
family being merely a manager and not an absolute owner, the Hindu law has,
like other systems of law, placed certain limitations upon his power to
alienate property which is owned by the joint family. The Hindu law-givers,
however, could not have intended to impose any such restriction on his power as
would virtually disqualify him from doing anything to improve the conditions of
the family. The only reasonable limitation which can be imposed on the karta is
that he must act with prudence, and prudence implies caution as well as
foresight and excludes hasty, reckless and arbitrary conduct." After
observing that the transaction entered into by a manager should not be of a
speculative nature the learned Chief Justice observed:
"In exceptional circumstances, however,
the court will uphold the alienation of a part of the joint family property by
a karta for the acquisition of new property as, for example, where all the
adult members of the joint family with the knowledge available to them and
possessing all the necessary information about the means and requirements of
the family are convinced that the proposed purchase of the new property is for
the benefit of the estate." These observations make it clear that where
adult members are in existence the judgment is to be not that of the manager of
the family alone but that of all the adult members of the family, including the
manager. In the case before us all the brothers of Pindidas were adults when'
the 328 contract was entered into. There is no suggestion that they agreed to
the transaction or were consulted about it or even knew of the transaction.
Even, therefore, if we hold that the view expressed by the learned Chief
Justice is right it does not help the plaintiff because the facts here are
different from those contemplated by the learned Chief Justice. The other Judge
who was a party to that decision, Manokarlal J., took more or less the same
The third case relied on is In the matter of
A.T. Vasudevan & Ors., minors(1). There a single Judge of the High Court
held that the manager of joint Hindu family is competent to alienate joint
family property if it is clearly beneficial to the estate even though there is
no legal necessity justifying the transaction. This view was expressed while,
dealing with an application under cl. 17 of Letters Patent by one Thiruvengada
Mudaliar for being appointed guardian of the joint family property belonging
to, inter alia, to his five minor sons and for sanction of the sale of that property
as being beneficial to the interests of the minor sons. The petitioner who was
karta of the family had, besides the five minor sons, two adult sons, his wife
and unmarried daughter who had rights of maintenance. It was thus in connection
with his application that the learned Judge considered the matter and from that
point of view the decision is distinguishable. However, it is a fact that the
learned Judge has clearly expressed the opinion that the manager has power to
sell joint family property if he is satisfied that the transaction would be for
the benefit of the family. In coming to this conclusion he has based himself
mainly upon the view taken by Venkata Subba Rao J., in Sellappa v. Suppan(2).
That was a case in which the question which arose for consideration was whether
borrowing money on the mortgage of joint family property for the purchase of a
house could be held to be binding on the family because the transaction was of
benefit to the family.
While holding that a transaction to be for
the benefit of the family need not be of a defensive character the learned
Judges, upon the evidence before them, held that this particular transac(1)
A.I.R. 1949 Mad. 260.
(2) A.I.R. 1937 Mad. 496.
329 tion was not established by evidence to
be one for the benefit of the family.
Thus, as we have already stated, that for a
transaction to be regarded as of benefit to the family it need not be of
defensive character so as to be binding on the family. In each case the court
must be satisfied from the material before it that it was in fact such as
conferred or was reasonably expected to confer benefit on the family at the
time it was entered into,. We have pointed out that there is not even an
allegation in the plaint that the transaction was such as was regarded as
beneficial to the family when it was entered into by Pindidas. Apart from that
we have the fact that here the adult members of the family have stoutly resisted
the plaintiff's claim for specific performance and we have no doubt that they
would not have done so if they were satisfied that the transaction was of
benefit to the family.
It may be possible that the land which was
intended to be sold had risen in value by the time the present suit was
instituted and that is why the other members of the family are contesting the
plaintiff's claim. Apart from that the adult members of the family are well
within their rights in saying that no part of the family property could be
parted with or agreed to be parted with by the manager on the ground of alleged
benefit to the family without consulting them. Here, as already stated, there
is no allegation of any such consultation.
In these circumstances we must hold that the
courts below were right in dismissing the suit for specific performance.
We may add that granting specific performance
is always in the discretion of the court and in our view in a case of this kind
the court would be exercising its discretion.
right by refusing specific performance.
No doubt Pindidas himself was bound by the
contract which he has entered into and the plaintiff would have been entitled
to the benefit of s. 15 of the Specific Relief Act which runs thus:
"Where a party to a contract is unable
to perform the whole of his part of it, and the part which 330 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 decree 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."
However, in the case before us there is no claim on behalf of the plaintiff
that he is willing to pay the entire consideration for obtaining a decree
against the interest of Pindidas alone in the property. In the result the
appeal fails and is dismissed with costs.