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since 1985 practicing as advocate in both civil & criminal laws. This blog is only for information but not for legal opinions

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Wednesday, September 3, 2014

Mohammedan Law - Conditional Gift - Life Estate - Transfer of Corpus but not usufruct - any condition not to alienate is void - Husband executed gifted to the wife with full rights of enjoyments - with out reserving his right to cancel and his successors have not right to challenge the same - but the condition is only that after her death it shall devolve on her children - husband died - she enjoyed the same - later she sold the same to the appellant - trial court decreed the suit - appeal court reversed the same - High court confirm the same but Apex court held that the gift is valid - condition is in valid - the sale deed infavour of appellant is also valid and as such the claim of children of donor is not maintainable = CIVIL APPEAL No.2364 OF 2005 V. SREERAMACHANDRA AVADHANI (D) BY L.RS. .......APPELLANTS VERSUS SHAIK ABDUL RAHIM & ANR. ......RESPONDENTS = 2014 Aug. Part. - http://judis.nic.in/supremecourt/filename=41834

Mohammedan Law - Conditional Gift - Life Estate - Transfer of Corpus but not usufruct - any condition not to alienate is void - Husband executed gifted to the wife with full rights of enjoyments - with out reserving his right to cancel and his successors too have not right to challenge the same - but the condition is only that after her death it shall devolve on her children - husband died - she enjoyed the same - later she sold the same to the appellant - trial court decreed the suit - appeal court reversed the same - High court confirm the same but Apex court held that  the gift is valid - condition is in valid - the sale deed infavour of appellant is also valid and as such the claim of children of donor is not maintainable =

In the  notice,  the  respondents
asserted, firstly, that Banu Bibi had only a life  interest  in  the  gifted
immovable  property;
and  secondly,  the  respondents   being   the   legal
representatives of Sheikh Hussein (who had gifted the immovable property  to
Banu Bibi) came to be vested with  the  right  and  title  over  the  gifted
immovable  property,  after  the  demise  of   Banu   Bibi.  
The   vendee,
V.Sreeramachandra Avadhani repudiated  the  assertions  made  in  the  legal
notice dated 22.03.1989, through his response dated 16.04.1989.=

The Principal Senior  Civil  Judge,  Eluru,  West  Godavari  District,
Andhra Pradesh dismissed the original suit on 19.08.1998.   
Relying  on  the
judgment rendered by the Privy Council in Nawazish  Ali  Khan  v.  Ali  Raza
Khan, AIR 1948 PC 134, the trial court arrived at the conclusion,  that  the
gift deed executed by Sheikh Hussein on  26.04.1952  transferring  immovable
property in favour of his wife Banu Bibi, was valid. 
It was also  concluded,
that the gifted immovable property came to  be  irrevocably  vested  in  the
donee Banu Bibi.  
That apart, the trial court held, that Sheikh Hussein  had
gifted the corpus of the immovable property to his wife  Banu  Bibi.   
Based
on the  aforesaid,  it  was  further  concluded,  that  all  the  conditions
expressed by the donor Sheikh Hussein, in the gift  deed  dated  26.04.1952,
depriving the donee of an absolute right/interest in  the  gifted  property,
were void. 
The trial court clearly  expressed,  that  the  gift  deed  dated
26.04.1952, was not in the nature of a usufruct.= 

On the subject of  “conditional
gifts”,  the  fundamentals/principles  of  Muhammadan  Law  as   have   been
explained in the treatise are extracted hereunder:
            “Gifts with conditions

             In hiba the immediate and absolute ownership in  the  substance
or corpus of a thing is transferred to  a  donee;  hence  where  a  hiba  is
purported to be made with conditions or restrictions annexed as to  its  use
or disposal, the conditions and  restrictions  are  void  and  the  hiba  is
valid.  The Fatawa Aamgiri says:

            All ‘our’ masters are agreed that when one has made a  gift  and
stipulated for a condition that is fasid or invalid, the gift is  valid  and
the condition void.  It is a general  rule  with  regard  to  all  contracts
which  require  seisin,  such  as  gift  and  pledge,  that  they  are   not
invalidated by vitiating conditions.
            Examples:-
D makes a hiba of a house for the residence of  the  donee  and  his  heirs,
generation after generation, declaring that if the donee sells or  mortgages
it the donor or his heirs will have a claim on the house but not  otherwise.
The donee takes an absolute estate both in Hanafi and in Ithna Ashari Law.

D makes a hiba on condition that he has an option  of  cancelling  the  hiba
within three days. The hiba is valid and the option void.

A makes a gift of government promissory notes  to  B  on  condition  that  B
should return one-fourth  part  of  the  notes  to  A  after  a  month.  The
condition relates to a return of part of the corpus. The condition  is  void
and the gift is valid.

A makes a hiba of certain property to B.  The deed of  gift  lays  down  the
condition that B shall not transfer the  property.   The  restraint  against
alienation is void and B takes the property absolutely.”
                                  (emphasis is ours)


Reliance  was  also  placed  on  “Mulla's  Principles  of   Mahomedan   Law”
(nineteenth edition, by M.Hidayatullah  and  Arshad  Hidayatullah)  and  our
attention was drawn to the following narration:
            “Gift with a condition.- When  a  gift  is  made  subject  to  a
condition which derogates from the completeness of the grant, the  condition
is void, and the gift will take effect as if no conditions were attached  to
it(s).

            “All our masters are agreed that when one has made  a  gift  and
stipulated for a condition that is fasid or invalid, the gift is  valid  and
the condition is void”.

 “Digest
of Moohummudan Law”,  by  Neil  B.E.Baillie  (part  first,  second  edition,
London: Smith, Elder & Co., 1875). The relevant extract of the  text  relied
upon is being reproduced hereunder:
            “Gift is of two kinds, tumleek (already described),  and  iskat,
which means literally, `to cause to fall’, or extinguish. The legal  effects
of gift are-1st. That it establishes a  right  of  property  in  the  donee,
without being obligatory on the donor; so  that  the  gift  may  be  validly
resumed or cancelled.  2nd. That it cannot be made subject to  a  condition;
though if a gift were made with an option to the donee for three  days,  and
were accepted before the separation of the parties, it would be valid.   And
3rd That it is not cancelled by vitiating conditions; so that if one  should
give his slave on condition of his being  emancipated,  the  gift  would  be
valid, and the condition void.”=

 Firstly,
the donor records, having purchased the gifted  property  from  his
own earning on 16.07.1944, through a registered purchase  deed,  whereby  he
was vested with the absolute  right  of  possession  and  enjoyment  of  the
property.
It is then asserted, that  there is no dispute about the title  of
the donor, over the gifted property.  
All the above  rights  in  the  donor,
are sought to be transferred by way of gift to Banu Bibi  by  asserting,  “I
am conveying in your favour as you are my wife and out of love  to  you  and
delivered possession of the same to you  forthwith,  From  now  onwards  you
shall  enjoy  This  immovable  property  freely…..”
The   words   extracted
hereinabove clearly establish the transfer of the corpus, which was  in  the
absolute ownership of the donor, to the donee.
Secondly, the use of the words “We  shall  have  no  right  to  cancel  this
conveyance with silly reasons” also reveals, the intention of the  donor  to
transfer the corpus of the property, to the donee.
Thirdly, the use of the words “Neither myself nor my successors shall  raise
any objection in respect of this conveyed property  either  against  you  or
against your successors”, recognises the rights of the donee as well as  her
successors.
These words extinguish, not only  the  donor's  rights  in  the
property, but also that of his  successors.
There  is  recognition  of  the
rights of the donee and her successors to the extent,  that in the event  of
transfer of the gifted property to the successors of  the  donee,  the  same
would not  be assailable by the donor or his successors.
This also  depicts,
the intention  of  the  donor  to  transfer  the  corpus   of   the   gifted
property.
Fourthly, the gift deed records that “…..after your life time this  property
shall devolve upon your off spring…..”.
The  use  of  the  words  “your  off 
spring”, expresses an intention which is separate  and  distinct  from  “our
off spring”.  
In other words, the gift deed  contemplates  the  transfer  of
the gifted property by the donee, to her children, even  if,  such  children
were not the children of the donor.  
This too shows that  the  intention  of
the donor, contemplated the transfer of the corpus.
Fifthly, the gift deed records “I am herewith filing transfer  memos,  along
with this deed for  registration,  to  get  your  name  mutated  in  revenue
records. Therefore from now on wards you shall pay the  Municipal  Taxes  and
shall enjoy the same freely and  happily.”   
This  expression  in  the  gift
deed, brings out the intention of  the  donor,  that  the  transfer  of  the
gifted property should not remain  a  matter  of  understanding  within  the
family, but should be an open declaration to the public.
The  assertion  in
the gift deed, that Municipal Taxes will be borne by the donee,  shows  that
the donee was to henceforth bear all liabilities of the gifted property,  as
its owner.
Lastly, the handing over of the earlier title deeds of the  gifted  property
to the donee, by recording in the gift deed that “I  have  handed  over  the
link sale deed and the voucher  to  you”  also  indicates,  that  the  donor
clearly expressed in the gift deed, that he had not retained  any  documents
of title pertaining to the gifted property  with  himself,  but  had  handed
over the same to the donee.  
This also shows the intention of the  donor  to
relinquish all his existing rights,  in  the  gifted  property.   
This  also
shows the intent of the donor, to transfer the corpus  of  the  property  to
the donee.

For the reasons recorded hereinabove, there can  be  no  doubt   whatsoever,
that the intention of the donor in the gift deed dated  26.04.1952,  was  to
transfer the corpus of the immovable property to the donee, and  not  merely
a usufruct therein.

17.   Having concluded that the donor Sheikh Hussein through the  gift  deed
dated 26.04.1952, had transferred the corpus of the  immovable  property  to
his wife Banu Bibi, it is natural to conclude that the  gift  deed  executed
in favour of Banu Bibi, was valid.
Likewise, while applying the  principles
of Muhammedan Law expressed in recognized texts, and  the  decision  of  the
Privy Council in Nawazish Ali Khan's case (supra) it is inevitable to  hold,
that all conditions depicted  in  the  gift  deed  dated  26.04.1952,  which
curtail use or disposal of the property gifted are to be  treated  as  void.
In the above view of the matter, the conditions depicted in the  gift  deed,
that the donee would  not  have  any  right  to  gift  or  sell  the  gifted
property, or that the donee would be precluded from  alienating  the  gifted
immovable  property  during  her  life  time,  are  void.  
Similarly,   the
depiction in the gift deed, that the gifted  immovable  property  after  the
demise of the donee, would devolve upon her off spring and in the  event  of
her not bearing any children, the same would return back to the donor or  to
his successors, would likewise be void.

18.   Having held that the gift deed  dated  26.04.1952  irrevocably  vested
all rights in the immovable property in Banu Bibi, it is natural for  us  to
conclude, that the sale of the gifted immovable property  by  Banu  Bibi  to
V.Sreeramachandra   Avadhani   on   02.05.1978,   was   legal   and   valid.
Consequently, the claim of the respondents to the gifted  property,  on  the
demise of Banu Bibi on 17.02.1989, is not sustainable in law.

19.   For the reasons recorded hereinabove, the instant appeal  is  allowed.
The order passed by the  trial  court  dated  19.08.1998  is  affirmed.  The
orders passed by the First Appellate Court  dated  05.01.2004,  and  by  the
High Court dated 02.08.2004, are set aside.

20.   There shall be no order as to costs.

2014 Aug. Part. - http://judis.nic.in/supremecourt/filename=41834
                                                            REPORTABLE


                        IN THE SUPREME COURT OF INDIA

                        CIVIL APPELLATE JURISDICTION

                        CIVIL APPEAL No.2364 OF 2005


V. SREERAMACHANDRA AVADHANI (D) BY L.RS.  .......APPELLANTS

                                   VERSUS

SHAIK ABDUL RAHIM & ANR.                   ......RESPONDENTS




                               J U D G M E N T


Jagdish Singh Khehar, J.


1.    Heard learned counsel for the parties.


2.    Sheikh Hussein was married to Banu Bibi.  During  the  subsistence  of
his matrimonial ties, Sheikh Hussein executed a  gift  deed  on  26.04.1952,
whereby a “tiled house” with open space in  Survey  No.883  in  Eluru  town,
West Godavari District, Andhra Pradesh was gifted  in  favour  of  his  wife
Banu Bibi.

3.    It is not a matter of dispute, that Banu Bibi  enjoyed  the  immovable
property gifted to her, during the lifetime of her husband  Sheikh  Hussein.
Sheikh Hussein died in 1966.  Even after the demise of Sheikh Hussein,  Banu
Bibi  continued  to  exclusively  enjoy  the  said  immovable  property.  On
02.05.1978,   Banu   Bibi   sold   the   gifted   immovable   property,   to
V.Sreeramachandra Avadhani. The vendee  V.Sreeramachandra  Avadhani  is  the
appellant before this Court (through his legal representatives).

4.    Banu Bibi died on 17.02.1989.  On her demise, the  respondents  before
this Court - Shail Abdul Rahim  and  Shaik  Abdul  Gaffoor  issued  a  legal
notice to the vendee.  Through the legal notice, they staked a claim on  the
abovementioned gifted immovable property.  In the  notice,  the  respondents
asserted, firstly, that Banu Bibi had only a life  interest  in  the  gifted
immovable  property;  and  secondly,  the  respondents   being   the   legal
representatives of Sheikh Hussein (who had gifted the immovable property  to
Banu Bibi) came to be vested with  the  right  and  title  over  the  gifted
immovable  property,  after  the  demise  of   Banu   Bibi.    The   vendee,
V.Sreeramachandra Avadhani repudiated  the  assertions  made  in  the  legal
notice dated 22.03.1989, through his response dated 16.04.1989.

5.    Having realized that the vendee would  not  part  with  the  immovable
property purchased by him from Banu Bibi, the respondents preferred  a  suit
bearing O.S.No.256 of  1989,  before  the  Subordinate  Judge,  Eluru,  West
Godavari District,  Andhra Pradesh.  In the suit, the respondents  sought  a
declaration of title, over the “tiled house”  with  open  space,  gifted  by
Sheikh Hussein to his wife Banu Bibi. In addition,  the  respondents  sought
recovery  of  possession,  and  also  mesne   profits,   from   the   vendee
V.Sreeramachandra Avadhani.                The above Original Suit filed  on
13.11.1989 was contested.                 A written statement was  filed  on
19.07.1990.

6.    The Principal Senior  Civil  Judge,  Eluru,  West  Godavari  District,
Andhra Pradesh dismissed the original suit on 19.08.1998.   Relying  on  the
judgment rendered by the Privy Council in Nawazish  Ali  Khan  v.  Ali  Raza
Khan, AIR 1948 PC 134, the trial court arrived at the conclusion,  that  the
gift deed executed by Sheikh Hussein on  26.04.1952  transferring  immovable
property in favour of his wife Banu Bibi, was valid. It was also  concluded,
that the gifted immovable property came to  be  irrevocably  vested  in  the
donee Banu Bibi.  That apart, the trial court held, that Sheikh Hussein  had
gifted the corpus of the immovable property to his wife  Banu  Bibi.   Based
on the  aforesaid,  it  was  further  concluded,  that  all  the  conditions
expressed by the donor Sheikh Hussein, in the gift  deed  dated  26.04.1952,
depriving the donee of an absolute right/interest in  the  gifted  property,
were void. The trial court clearly  expressed,  that  the  gift  deed  dated
26.04.1952, was not in the nature of a usufruct.

7.     Dissatisfied  with  the  order  passed  by  the  trial   court,   the
respondents preferred  an  appeal  before  the  Second  Additional  District
Judge, Eluru, West Godavari District, Andhra Pradesh.  The  First  Appellate
Court accepted the appeal preferred by the  respondents  on  05.01.2004.  On
the issue whether Banu Bibi had an absolute right  over  the  “tiled  house”
with open space, gifted to her,  the  First  Appellate  Court  recorded  its
finding on the basis of the text of the gift  deed,  dated  26.04.1952.  The
consideration recorded by the  First  Appellate  Court  is  being  extracted
hereunder:
            “13. It is the bounden duty of the  plaintiffs  to  prove  that,
they have inherited the property as the legal heirs of Shaik Hussain  Saheb,
as his wife has no right to alienate the property Exs. A-1 and B-5 which  is
one and the same document is the crucial  document  to  determine  the  main
issue in this suit. A perusal of the said document clearly  shows  the  fact
that in the said settlement deed  dated  26-4-1952  which  was  executed  by
Shaik Hussain Sahab in favour of his  wife  Bhanubibi  he  has  specifically
mentioned that, she has no right to alienate the property and she can  enjoy
the property as she likes and after her death it  would  devolved  upon  her
children if she has got children and if she has not children, the  heirs  of
Shaik Hussain Saheb would inherit the same.  It is clearly mentioned in  the
said documents as follows:

            “During your life time you shall not alienate this  property  in
favour of any body and after your life  time  this  property  shall  devolve
upon your off spring and if you have no children the same shall return  back
to me or to my  near  successors  with  absolute  rights  of  enjoyment  and
dispossession by way of gift, sale etc.”

            This recital itself  shows  that,  Bhanubibi  has  no  right  to
alienate the plaint schedule property and she has right to  enjoy  the  same
throughout her life only and after her death,  it  would  devolve  upon  her
children if she got children and  in  the  absence  of  children,  it  would
revert back to  her  husband  Shaik  Hussain  Saheb  and  Bhanubibi  has  no
children. Further admittedly Shaik Hussain Saheb  died  earlier  to  Bhanubibi.
Further  admittedly  the
plaintiffs are the legal heirs of Shaik Hussain Saheb.   As  per  the  above
settlement deed, the plaintiffs  are  the  rightful  owners  of  the  plaint
schedule property.  Further though it is contended  by  the  defendant  that
for some other  property  Shaik  Hussain  Saheb  executed  a  will  and  the
plaintiffs filed a  suit  which  was  dismissed,  the  said  facts  are  not
applicable to the facts of this  case  and  the  cause  of  action  and  the
property involved are different in the suit and further  the  1st  defendant
has not filed any document of the said to confirm  his  right.   Hence  this
Court holds that, the plaintiffs are the absolute  owners  of  the  property
and they are entitled for declaration of the suit schedule property.   Hence
this  issue  is  decided  in  favour  of  the  plaintiffs  and  against  the
defendants.”

                                          (emphasis is ours)

A perusal of the judgment rendered by the  First  Appellate  Court  reveals,
that the appeal was adjudicated, as if the controversy was in the nature  of
a disputed question of fact, without  appreciating  the  legal  implications
pertaining  to  gift,  under  Muhammedan   Law.    While   determining   the
controversy, the First Appellate Court did  not  examine  whether  the  gift
dated 26.04.1952, constituted transfer of the corpus  of  the  property,  or
merely its usufruct.  The First Appellate Court, without  any  reference  to
the judgment of the Privy Council relied upon  by  the  trial  court,  while
interpreting the text of the gift deed  dated  26.04.1952,  arrived  at  the
conclusion, that Banu Bibi had merely been transferred a  life  interest  in
the “tiled house” with open space, gifted to her on 26.04.1952.



8.    Dissatisfied with the judgment rendered by the First Appellate  Court,
the vendee V.Sreeramachandra Avadhani preferred an appeal  before  the  High
Court of Judicature of Andhra Pradesh, at  Hyderabad  (hereinafter  referred
to as the `High Court’).  The High  Court  while  disposing  of  the  Second
Appeal No.313 of 2004 on 02.08.2004 affirmed the determination  recorded  by
the First Appellate Court.  The operative part of  the  order  of  the  High
Court, on the nature and effect of the gift deed dated 26.04.1952, is  being
extracted hereunder:
            “Considering the submissions made and also  on  perusal  of  the
material, the question which falls for consideration  in this appeal is,  as
to whether Bhanubibi is wife of Shaik Hussain Saheb, who was admittedly  the
owner of the properties, and had  any  alienable  rights  in  terms  of  the
settlement deed executed on her favour on 26-04-1952  and  consequently  the
sale in favour of the appellant  is  valid.   Necessarily,  these  questions
call for the consideration of the terms and  conditions  of  the  settlement
deed and interpretation thereof, which no doubt is a factual matrix.   There
cannot be any dispute in regard to  the  terms  as  contained  in  the  said
settlement deed.  The lower Appellate Court  did  taken  into  consideration
the restriction imposed  on  her  and  being  they  having  no  children  of
themselves and the plaintiffs being the only heirs, it was held  that  there
could not have been sale in favour of the appellant.  Having regard  to  the
terms as contained therein and which has rightly  taken  into  consideration
by the lower Appellate Court, I do not find any illegality or perversity  in
regard to the approach made by the lower Appellate Court in considering  the
terms of the said settlement deed.”

                                                          (emphasis is ours)

A perusal of the consideration recorded by the High Court reveals, that  the
High Court also did not examine the nature and effect of the gift.   It  did
not take into consideration, whether the gift was in respect of  the  corpus
of the immovable property, or its usufruct. The  High  Court  also  did  not
take into consideration, the judgment  rendered  by  the  Privy  Council  in
Nawazish  Ali Khan's  case  (supra)(which  was  relied  upon  by  the  trial
court).  The controversy was again disposed of, on the basis  of  a  literal
interpretation of the terms  and  conditions  expressed  in  the  gift  deed
(dated 26.04.1952).

9.    Having lost before the First Appellate  Court,  as  also,  before  the
High Court, the legal representatives of the vendee  approached  this  Court
by filing Special Leave to Appeal  (Civil)  No.22023  of  2004.   Leave  was
granted by this Court on 01.04.2005.

10.    We  have  heard  learned  counsel  representing  the  rival  parties.
During the course of hearing, learned  counsel  for  the  appellants  placed
reliance, on the different aspects of  Muhammadan  Law  on  the  subject  of
gifts (hiba).  In this behalf reference was first of  all  placed  on  “Asaf
A.A.Fyzee Outlines of Muhammadan Law”, (fifth edition,  edited  and  revised
by Tahir Mahmood, Oxford University Press).  On the subject of  “conditional
gifts”,  the  fundamentals/principles  of  Muhammadan  Law  as   have   been
explained in the treatise are extracted hereunder:
            “Gifts with conditions

             In hiba the immediate and absolute ownership in  the  substance
or corpus of a thing is transferred to  a  donee;  hence  where  a  hiba  is
purported to be made with conditions or restrictions annexed as to  its  use
or disposal, the conditions and  restrictions  are  void  and  the  hiba  is
valid.  The Fatawa Aamgiri says:

            All ‘our’ masters are agreed that when one has made a  gift  and
stipulated for a condition that is fasid or invalid, the gift is  valid  and
the condition void.  It is a general  rule  with  regard  to  all  contracts
which  require  seisin,  such  as  gift  and  pledge,  that  they  are   not
invalidated by vitiating conditions.
            Examples:-
D makes a hiba of a house for the residence of  the  donee  and  his  heirs,
generation after generation, declaring that if the donee sells or  mortgages
it the donor or his heirs will have a claim on the house but not  otherwise.
The donee takes an absolute estate both in Hanafi and in Ithna Ashari Law.

D makes a hiba on condition that he has an option  of  cancelling  the  hiba
within three days. The hiba is valid and the option void.

A makes a gift of government promissory notes  to  B  on  condition  that  B
should return one-fourth  part  of  the  notes  to  A  after  a  month.  The
condition relates to a return of part of the corpus. The condition  is  void
and the gift is valid.

A makes a hiba of certain property to B.  The deed of  gift  lays  down  the
condition that B shall not transfer the  property.   The  restraint  against
alienation is void and B takes the property absolutely.”
                                  (emphasis is ours)


Reliance  was  also  placed  on  “Mulla's  Principles  of   Mahomedan   Law”
(nineteenth edition, by M.Hidayatullah  and  Arshad  Hidayatullah)  and  our
attention was drawn to the following narration:
            “Gift with a condition.- When  a  gift  is  made  subject  to  a
condition which derogates from the completeness of the grant, the  condition
is void, and the gift will take effect as if no conditions were attached  to
it(s).

            “All our masters are agreed that when one has made  a  gift  and
stipulated for a condition that is fasid or invalid, the gift is  valid  and
the condition is void”.

            Gift of a life-estate.-Life  estates  were  considered  to  come
under this principle with  the  result  that  the  donee  took  an  absolute
interest.  But in Amjad Khan's  case  (1929)  56  I.A.213,  4  Luck.305  the
Judicial Committee did not regard the principle as applicable to the  facts.
 See sec.55 and the cases there cited. “An amree  (life  grant)  is  nothing
but a gift and a condition; and the condition is invalid; but  the  gift  is
not rendered null by involving an invalid condition”.  Hedaya,  489.   In  a
later case the Privy Council (Nawazish Ali Khan v. Ali Raza Khan  (1948)  75
I.A.62, (48) A.PC.134) observed that there was no such thing as life  estate
or vested remainder in Mahomedan Law as understood in  English  Law,  but  a
gift for life would be construed as an interest for life in the usufruct.

            `Life estate’ in  the  sense,  that  is,  the  transfer  of  the
ownership of the property itself limited to  the life of the donee,  with  a
condition  that  the  donee  would  have  no  right  of  alienation  is  not
recognised by Mahomedan Law.  But  the  view  that  once  prevailed  to  the
effect, that under the Mahomedan Law, a life interest with such a  condition
is nothing but a gift with a repugnant condition, when  the  condition  must
fail and the gift must prevail as an absolute one, is no longer good law  in
view of later decisions of the Privy Council.”

                                                          (emphasis is ours)

It would be pertinent to mention, that our attention was not invited to  any
contrary legal view, expressed either by the Privy Council, or by any  other
Court.

11.   Learned counsel for the appellants also placed reliance on  a  “Digest
of Moohummudan Law”,  by  Neil  B.E.Baillie  (part  first,  second  edition,
London: Smith, Elder & Co., 1875). The relevant extract of the  text  relied
upon is being reproduced hereunder:
            “Gift is of two kinds, tumleek (already described),  and  iskat,
which means literally, `to cause to fall’, or extinguish. The legal  effects
of gift are-1st. That it establishes a  right  of  property  in  the  donee,
without being obligatory on the donor; so  that  the  gift  may  be  validly
resumed or cancelled.  2nd. That it cannot be made subject to  a  condition;
though if a gift were made with an option to the donee for three  days,  and
were accepted before the separation of the parties, it would be valid.   And
3rd That it is not cancelled by vitiating conditions; so that if one  should
give his slave on condition of his being  emancipated,  the  gift  would  be
valid, and the condition void.”
                                                          (emphasis is ours)

A perusal of the above text inter alia reveals, that under  Muhammadan  Law,
a gift has to be unconditional.  Therefore, conditions expressed in a  gift,
are to be treated as void. A conditional gift is valid, but  the  conditions
are void.

12.   Learned counsel for the  appellants  then  invited  our  attention  to
another part of  the  “Digest  of  Moohummudan  Law”  by  Neil  B.E.Baillie,
dealing with “of the effect of a condition in the gift”.   The  text  relied
upon is being reproduced hereunder:
            “When a slave or a thing is given on a condition that the  donee
shall have an option for three days, the gift is lawful if confirmed by  him
before the separation of the parties; and  if  not  confirmed  by  him  till
after they have separated, it is not lawful.  But when a thing is  given  on
a condition that the donor shall have an option for three days, the gift  is
valid, and the option void; because gift is  not  a  binding  contract,  and
therefore does not admit of the option of stipulation.   A  person  says  to
another, `I have released thee from my  right  against  thee,  on  condition
that I have an option,’ the release is lawful, and the option void.

            A man to whom a thousand dirhems are  due  by  another  says  to
him, `When the morrow has come the thousand is thine,’  or  `thou  art  free
from it,’ or `When thou hast paid one-half the property then thou  art  free
from the remaining half,’ or `the remaining half  is  thine,’  the  gift  is
void.’ But if he should say, `I have released  you  on  condition  that  you
emancipate  your  slave,’  or  `Thou  art  released  on  condition  of   thy
emancipating him  by  my  releasing  thee,’  and  he  should  say,  `I  have
accepted,’ or `I have emancipated him,’ he would be released from the debt.

            All `our’ masters are agreed that when one has made a  gift  and
stipulated for a condition that is fasid, or invalid, the gift is valid  and
the condition void; as if one should  given  another  a  female  slave,  and
stipulate `that he shall not sell her,’ or `shall make her an  com-i-wulud,’
or `shall sell her to such an one,’ or `restore her to  the  giver  after  a
month,’ the gift would be valid, and all the conditions  void’.  Or  if  one
should give a mansion, or bestow it in alms, on condition  `that  the  donee
shall restore some part of it,’ or  `give  some  part  of  it  is  iwuz,  or
exchange,’ the gift would be  lawful  and  the  condition  void.’  It  is  a
general rule with regard to all contracts  which  require  seisin,  such  as
gift and pledge, that they are not invalidated by vitiating conditions.”

                                    (emphasis is ours)

The above text also leads to the same inferences as have been drawn above.

13.   Having  placed  reliance  on  different  commentaries  noticed  above,
learned counsel for the appellants invited our  attention  to  the  decision
rendered by the Privy Council in Nawazish Ali Khan’s case  (supra).  It  was
the vehement contention of the learned counsel for the appellants, that  the
texts brought to our notice by him, were expressly approved,  in  the  above
judgment.  Learned counsel placed reliance on  the  following  observations,
from the decision of the Privy Council in Nawazish Ali Khan's case (supra):

      “19 The Chief Court in appeal took the view that under  the  wills  of
Nasir Ali Khan the estate vested after his death  in  the  three  successive
tenants for life; that on the exercise of the power of appointment it  would
pass immediately to the appointee; that there was  no  period  during  which
the estate would be in abeyance; and that the rights of  the  heirs  of  the
testator were not affected or prejudiced. In their  Lordships  opinion  this
view of the matter introduces into Muslim law legal  terms  and  conceptions
of ownership familiar enough in English law,  but  wholly  alien  to  Muslim
law. In general, Muslim law draws no distinction between real  and  personal
property, and their Lordships know of no authoritative work on  Muslim  law,
whether the Hedaya or Baillie or more modern works, and no decision of  this
Board  which  affirms  that  Muslim  law  recognises  the  splitting  up  of
ownership of land into estates,  distinguished  in  point  of  quality  like
legal and equitable estates, or in point of duration  like  estates  in  fee
simple, in tail, for life, or in remainder. What Muslim law  does  recognise
and insist upon, is the distinction  between  the  corpus  of  the  property
itself (ayn) and the usufruct in the property (manafi). Over the  corpus  of
property  the  law  recognises  only  absolute   dominion,   heritable   and
unrestricted in point of time; and where a  gift  of  the  corpus  seeks  to
impose a condition inconsistent with such absolute  dominion  the  condition
is rejected as repugnant; but interests limited in  point  of  time  can  be
created in the usufruct of the property and the  dominion  over  the  corpus
takes effect subject to any such limited interests.

"If a person bequeath the service of his slave, or the  use  of  his  house,
either for a definite or  an  indefinite  period,  such  bequest  is  valid;
because  as  an  endowment  with  usufruct,  either  gratuitous  or  for  an
equivalent, is valid during life, it is consequently  so  after  death;  and
also, because men have occasion to make bequests of this nature as  well  as
bequests of actual property. So likewise, if a person bequeath the wages  of
his slave, or the rent of his house, for a definite or indefinite  term,  it
is valid, for the same reason. In both cases, moreover, it is  necessary  to
consign over the house or the slave, to the legatee, provided  they  do  not
exceed the third of the property in order that he may  enjoy  the  wages  or
service of the slave, or the rent or  use  of  the  house  daring  the  term
prescribed, and afterwards restore it to the heirs." (Hedaya, Vol.4,  p.527,
chap.5, entitled "Of Usufructuary Will.")

This distinction runs all through the  Muslim  law  of  gifts-gifts  of  the
corpus (hiba), gifts of the usufruct (ariyat) and usufructuary bequests.  No
doubt where the use of a house is given to a man for his life  he  may,  not
inaptly, be termed a tenant for life, and the owner of  the  house,  waiting
to enjoy it until the termination of the limited interest, may be said,  not
inaccurately, to possess a vested remainder. But though the same  terms  may
be used in English and Muslim law, to describe much  the  same  things,  the
two systems of law are based on quite different conceptions  of  ownerships.
English law recognises ownership of land limited  in  duration;  Muslim  law
admits only ownership unlimited in duration,  but  recognises  interests  of
limited duration in the use of property.

20 There is a full discussion of the law on this subject  in  the  judgment,
of Sir Wazir Hasan in the case of Amjad Khan  v.  Ashraf  Khan.4  That  case
challenged the doctrine accepted by Hanafi lawyers that a gift  to  "A"  for
life conferred an absolute interest on "A"; a doctrine based on a saying  of
the Prophet (Hedaya, Bk. III, p. 309) :

"An amree or life grant is  lawful  to  the  grantee  during  his  life  and
descends to his heirs. The meaning of amree  is  a  gift  of  a  house  (for
example) during the life of the donee, on condition of  its  being  returned
upon his death. An amree is nothing but a  gift  and  a  condition  and  the
condition is invalid; but a gift  is  not  rendered  null  by  involving  an
invalid condition."

Sir Wazir Hasan in his judgment examined the appropriate tests and  all  the
relevant decisions of the Privy Council. He pointed out the  distinction  in
Muslim law between the corpus and the usufruct,  between  the  thing  itself
and the use of the thing. On the construction  of  the  deed  which  was  in
question in the case before him, he came to the conclusion  that  the  donor
intended to confer upon his wife not the corpus, but a life  interest  only,
that such life interest could take effect as  a  gift  of  the  use  of  the
property and not as part of the property itself, and that there was  nothing
in Muslim law which compelled him to hold that the intended gift of  a  life
estate conferred an absolute interest on the donee. This case was  taken  in
appeal to the Privy Council and is reported in 56 IA 213.5 The Board  agreed
with Sir Wazir Hasan on the construction of the deed in question  that  only
a life interest was intended, and held that if the wife  took  only  a  life
interest it came to an end on her death and the appellant who was  her  heir
took nothing, and if the life interest was bad the wife took no interest  at
all and the appellant was in no better case. There is also a  discussion  of
the basis upon which a life interest under Hanab law  can  be  supported  in
the 3rd edition of Tyabji's Muhammadan Law at pp. 487 et seq: That  book  as
the work of an author still living, cannot be cited  as  an  authority,  but
their Lordships have derived assistance from the discussion.

21 Limited interests have long been recognised under Shia  law.  The  object
of "Habs" is "the empowering of a person to receive the profit  or  usufruct
of a thing with a reservation of the owner's right of property in it . .  .I
have bestowed on thee this mansion .,. for thy life or  my  life  or  for  a
fixed period" is binding by seizm on the part of the donee. (Bail: II  226).
See also 32 Bom 1726 at p. 179. Their  Lordships  think  that  there  is  no
difference between the several Schools of Muslim law  in  their  fundamental
conception of property and ownership. A limited interest  takes  effect  out
of the usufruct under any of the schools.  Their  Lordships  feel  no  doubt
that in dealing with a gift under Muslim law, the first duty  of  the  Court
is to construe the gift. If it is a gift of the corpus, then  any  condition
which derogates from absolute dominion over the subject of the gift will  be
rejected as repugnant; but if upon construction the gift is held to  be  one
of a limited interest the gift can take effect out of the usufruct,  leaving
the ownership of the corpus unaffected except to the  extent  to  which  its
enjoyment is postponed for the duration of the limited interest.”

                                         (emphasis is ours)

14.   The above  extracts  from  the  observations  recorded  by  the  Privy
Council, leave no room for any doubt, that the parameters for  gifts  (under
Mohammedan Law) are clear and well defined.  Gifts pertaining to the  corpus
of the property are absolute.  Where a gift of  corpus  seeks  to  impose  a
limit, in point of time  (as  a  life  interest),  the  condition  is  void.
Likewise, all other conditions, in a gift of the corpus  are  impermissible.
In other words, the gift of the corpus has to be unconditional.   Conditions
are however permissible, if the gift is merely of  a  usufruct.   Therefore,
the gift of a usufruct can validly impose a limit, in point of time  (as  an
interest, restricted to the life of the donee).
15.    Having  given  our  thoughtful  consideration  to  the  treatises  on
Muhammedan Law brought to our notice, as also, the judgment rendered by  the
Privy Council in Nawazish Ali Khan's case (supra), we are of the  considered
view, that in a gift which contemplates the transfer of  the  corpus,  there
is no  question  of  such  transfer  being  conditional.   The  transfer  is
absolute. Conditions imposed in a gift of the corpus,  are  void.   For  the
determination of the present controversy, the only issue  to  be  considered
by us is, whether the gift made by Sheikh Hussein in  favour  of  Banu  Bibi
dated 26.04.1952 contemplates the transfer of the corpus.  If the answer  to
the above is in the affirmative, then the will  dated  26.04.1952  would  be
considered as valid, but  the  conditions  incorporated  therein,  would  be
regarded as void.

16.   The transfer of the corpus refers to a change in ownership, while  the
transfer of usufruct refers to a change in the right  of  its  use/enjoyment
etc.   In  order  to  determine  whether  the  gift  deed  dated  26.04.1952
envisaged a transfer of the corpus, we will have to examine the contents  of
the gift deed itself.  Accordingly, the gift deed dated 26.04.1952 is  being
reproduced hereunder:

            “This deed of  conveyance  of  immovable  property,  i.e.  tiled
house with open place worth of Rs.3000.00

                            XXXXXXX

            The tiled house together with open place shown in  the  schedule
below which was purchased by  me  out  of  my  earnings  on  16.7.1944  from
Smt.Manikyamma, W/o Sri Arundalapalli Tiruvallur  Veera  Raghavulu  and  got
the same registered as document No.2462/44 and taken possession of the  same
and ever since has been under my absolute right,  possession  and  enjoyment
about there are no disputes or any joint sureties etc.  I  am  conveying  in
your favour as you are my  wife  and  out  of  love  to  you  and  delivered
possession of the same to you forthwith, From now onwards  you  shall  enjoy
This immovable property freely without a right to gift, Sale etc. and  since
you have no issue so far, you shall enjoy  the  property  during  your  life
time.  Neither myself  nor  my  successors  shall  raise  any  objection  in
respect of this  conveyed  property  either  against  you  or  against  your
successors. We shall have no right to  cancel  this  conveyance  with  silly
reasons.  During your life time you shall  not  alienate  This  property  in
favour of any body and after your life  time  this  property  shall  devolve
upon your off spring and if you have no children the same shall return  back
to me or to my  near  successors  with  absolute  rights  of  enjoyment  and
dispossession by way of gift, Sale  etc.   I  am  herewith  filing  transfer
memos along with this deed for registration to  get  your  name  mutated  in
revenue records. Therefore from now onwards  you  shall  pay  the  Municipal
Taxes and shall enjoy the same freely and happily.  I have handed  over  the
link sale deed and the voucher to you.  It is settled that the said  voucher
shall be kept with me or with my successors after your life time.”



Having given our thoughtful consideration to  the  text  of  the  gift  deed
dated 26.04.1952, we  are  of  the  view  that  the  same  contemplates  the
transfer of the corpus and not the usufruct.   Our  reasons  for  the  above
conclusion, are as under:
Firstly, the donor records, having purchased the gifted  property  from  his
own earning on 16.07.1944, through a registered purchase  deed,  whereby  he
was vested with the absolute  right  of  possession  and  enjoyment  of  the
property. It is then asserted, that  there is no dispute about the title  of
the donor, over the gifted property.  All the above  rights  in  the  donor,
are sought to be transferred by way of gift to Banu Bibi  by  asserting,  “I
am conveying in your favour as you are my wife and out of love  to  you  and
delivered possession of the same to you  forthwith,  From  now  onwards  you
shall  enjoy  This  immovable  property  freely…..”  The   words   extracted
hereinabove clearly establish the transfer of the corpus, which was  in  the
absolute ownership of the donor, to the donee.
Secondly, the use of the words “We  shall  have  no  right  to  cancel  this
conveyance with silly reasons” also reveals, the intention of the  donor  to
transfer the corpus of the property, to the donee.
Thirdly, the use of the words “Neither myself nor my successors shall  raise
any objection in respect of this conveyed property  either  against  you  or
against your successors”, recognises the rights of the donee as well as  her
successors.  These words extinguish, not only  the  donor's  rights  in  the
property, but also that of his  successors.  There  is  recognition  of  the
rights of the donee and her successors to the extent,  that in the event  of
transfer of the gifted property to the successors of  the  donee,  the  same
would not  be assailable by the donor or his successors. This also  depicts,
the intention  of  the  donor  to  transfer  the  corpus   of   the   gifted
property.
Fourthly, the gift deed records that “…..after your life time this  property
shall devolve upon your off spring…..”. The  use  of  the  words  “your  off
spring”, expresses an intention which is separate  and  distinct  from  “our
off spring”.  In other words, the gift deed  contemplates  the  transfer  of
the gifted property by the donee, to her children, even  if,  such  children
were not the children of the donor.  This too shows that  the  intention  of
the donor, contemplated the transfer of the corpus.
Fifthly, the gift deed records “I am herewith filing transfer  memos,  along
with this deed for  registration,  to  get  your  name  mutated  in  revenue
records. Therefore from now onwards you shall pay the  Municipal  Taxes  and
shall enjoy the same freely and  happily.”   This  expression  in  the  gift
deed, brings out the intention of  the  donor,  that  the  transfer  of  the
gifted property should not remain  a  matter  of  understanding  within  the
family, but should be an open declaration to the public.  The  assertion  in
the gift deed, that Municipal Taxes will be borne by the donee,  shows  that
the donee was to henceforth bear all liabilities of the gifted property,  as
its owner.
Lastly, the handing over of the earlier title deeds of the  gifted  property
to the donee, by recording in the gift deed that “I  have  handed  over  the
link sale deed and the voucher  to  you”  also  indicates,  that  the  donor
clearly expressed in the gift deed, that he had not retained  any  documents
of title pertaining to the gifted property  with  himself,  but  had  handed
over the same to the donee.  This also shows the intention of the  donor  to
relinquish all his existing rights,  in  the  gifted  property.   This  also
shows the intent of the donor, to transfer the corpus  of  the  property  to
the donee.

For the reasons recorded hereinabove, there can  be  no  doubt   whatsoever,
that the intention of the donor in the gift deed dated  26.04.1952,  was  to
transfer the corpus of the immovable property to the donee, and  not  merely
a usufruct therein.

17.   Having concluded that the donor Sheikh Hussein through the  gift  deed
dated 26.04.1952, had transferred the corpus of the  immovable  property  to
his wife Banu Bibi, it is natural to conclude that the  gift  deed  executed
in favour of Banu Bibi, was valid.  Likewise, while applying the  principles
of Muhammedan Law expressed in recognized texts, and  the  decision  of  the
Privy Council in Nawazish Ali Khan's case (supra) it is inevitable to  hold,
that all conditions depicted  in  the  gift  deed  dated  26.04.1952,  which
curtail use or disposal of the property gifted are to be  treated  as  void.
In the above view of the matter, the conditions depicted in the  gift  deed,
that the donee would  not  have  any  right  to  gift  or  sell  the  gifted
property, or that the donee would be precluded from  alienating  the  gifted
immovable  property  during  her  life  time,  are  void.   Similarly,   the
depiction in the gift deed, that the gifted  immovable  property  after  the
demise of the donee, would devolve upon her off spring and in the  event  of
her not bearing any children, the same would return back to the donor or  to
his successors, would likewise be void.

18.   Having held that the gift deed  dated  26.04.1952  irrevocably  vested
all rights in the immovable property in Banu Bibi, it is natural for  us  to
conclude, that the sale of the gifted immovable property  by  Banu  Bibi  to
V.Sreeramachandra   Avadhani   on   02.05.1978,   was   legal   and   valid.
Consequently, the claim of the respondents to the gifted  property,  on  the
demise of Banu Bibi on 17.02.1989, is not sustainable in law.

19.   For the reasons recorded hereinabove, the instant appeal  is  allowed.
The order passed by the  trial  court  dated  19.08.1998  is  affirmed.  The
orders passed by the First Appellate Court  dated  05.01.2004,  and  by  the
High Court dated 02.08.2004, are set aside.

20.   There shall be no order as to costs.


                                ...........................J.
         (JAGDISH SINGH KHEHAR)




                       ...........................J.
                                                       (ROHINTON FALI
NARIMAN)
NEW DELHI;
AUGUST 21, 2014.

Monday, September 1, 2014

Accident claim - trial court awarded Rs.37 lacs and odd where as High court reduced the same to Rs.15 lacs and odd - Apex court held that deceased aged 58 years, his salary Rs.50000 and odd - multiplication by 8 and 1/4 th deduction - and other benefits granted - where as high court unnecessarily deducted the same under contributory negligence as the offender vehicle driver was acquitted in criminal case and reduced the compensation by raising personal deduction to one third and also not granted other benefits and also reduced the annual income with unnecessary deductions against law = CIVIL APPEAL NO.7158 OF 2014 (Arising out of SLP(C) NO. 4333 OF 2014) SARALADEVI & ORS. ………APPELLANTS Vs. DIVISIONAL MANAGER, M/S ROYAL SUNDARAM ALLIANCE INS. CO. LTD. & ANR. …RESPONDENTS = 2014- Aug. Part – http://judis.nic.in/supremecourt/filename=41857

Accident claim - trial court awarded Rs.37 lacs and odd where as High court reduced the same to Rs.15 lacs and odd - Apex court held that deceased aged 58 years, his salary Rs.50000 and odd - multiplication by 8 and 1/4 th deduction - and other benefits granted - where as high court unnecessarily deducted the same under contributory negligence as the offender vehicle driver was acquitted in criminal case  and reduced the compensation by raising personal deduction to one third and also not granted other benefits and also reduced the annual income with unnecessary deductions against law  =
The  prosecution  has
failed to prove  the  case  against  the  driver  beyond  reasonable  doubt,
therefore, the learned Judicial Magistrate had acquitted the driver  of  the
vehicle from the charge framed against him vide order dated 31.05.2010.

3.  The appellants - the widow, two daughters and bed-ridden aged mother  of
the deceased-Vasanthan  approached  the  Motor  Accidents  Claims  Tribunal,
Vellore (for short “MACT”) by filing claim petition  under  Section  166  of
the Motor Vehicles Act, 1988 (for short “the Act”) claiming compensation  of
Rs.45,00,000/- on account of death of their sole bread earner,  against  the
owner as well as the insurer of the vehicle. The  said  claim  petition  was
registered as M.C.O.P. No. 138 of 2009.=
At the time of death, Vasanthan  was  58
years  old  and  was  earning  a  salary  of  Rs.50,809/-  per  month   i.e.
Rs.6,09,708/- annually. By applying the appropriate multiplier of 8 as  laid
down under Kerala Road Transport Corporation v. Susamma Thomas[3], the  loss
of dependency comes to Rs.48,77,708/-.=

we are of the view that  where  the  deceased  was  married,  the  deduction
towards personal and living expenses of the deceased,  should  be
one-third
(1/3rd) where the number of dependent family members is 2 to  3,
one-fourth
(1/4th) where the number of dependent family members is 4  to  6,  and
one-
fifth (1/5th) where the number of dependent family members exceeds six.”

      The High Court failed to follow the above judgement and  committed  an
error in law in deducting 1/3rd amount  towards  personal  expenses  of  the
deceased.
Therefore, as per the above judgement the deduction  ought  to  be
1/4th only as correctly calculated by the Tribunal.
Thus,  after  deducting
1/4th  i.e.  Rs.12,19,416/-  towards  personal   expenses;   the   loss   of
dependency would be Rs.36,58,248/.
Further, we affirm  the  sum  granted  by
the Tribunal as Rs.5,000/- for funeral expenses, under the head of  loss  of
estate at Rs.10,000/-, loss of consortium  at  Rs.10,000/-  and  Rs.50,000/-
for loss of love and affection of the deceased.

12.     Further, the High Court has erred in not following the  decision  of
Rajesh and Ors. v. Rajbir Singh and Ors.[4]  by  awarding  only  Rs.10,000/-
for loss of consortium, instead of Rs.1,00,000/-.
Towards  loss  of  estate,
the High Court awarded Rs.10,000/- instead of  Rs.1,00,000/.
Therefore,  to
this extent there is loss caused to the appellants in not being  compensated
correctly under different  heads  such  as,  loss  of  consortium,  loss  of
estate,  and  loss  of  love  and  affection.
 Further,  as  per   Municipal
Corporation of Delhi v. Uphaar Tragedy Victims Association  &  Ors.[5],  the
appellants are entitled for  9%  interest  per  annum  on  the  compensation
awarded from the date  of  filing  of  the  application  till  the  date  of
payment.
Thus, there will be a difference of 1.5%  interest  amount  payable
on the total compensation awarded by both the Tribunal and  the  High  Court
as they have awarded at  7.5%  interest.
Therefore,  if  the  less  awarded
difference of interest amount @ 1.5%  by both  the  Tribunal  and  the  High
Court is taken into consideration  on  the  total  compensation  awarded  in
favour of the appellants,  it  would  take  care  of  the  amount  that  was
required to be  deducted towards income tax out of the gross salary  of  the
deceased for determining the compensation  under  the  heading  of  loss  of
dependency.
13.      Since,  the  High  Court  has  erred  in  not  correctly   awarding
compensation under the above heads  and  having  regard  to  the  facts  and
circumstances of the case, we affirm the Award of the Tribunal and the  same
is restored.
     Therefore,  the  determination  of  compensation  under  the  loss   of
dependency under other heads as indicated  in  the  following  paragraph  is
perfectly legal and valid as the said compensation is  just  and  reasonable
keeping in view the monthly income at Rs.50,809/-  as  per  the  documentary
evidence (Ex.P-7), the salary certificate.
14.   In the result, the impugned judgment and order of the  High  Court  is
liable to be set aside and accordingly  set  aside  and  the  Award  of  the
Tribunal is  affirmed.  Therefore,  the  appellants  shall  be  entitled  to
compensation under the following heads:

Loss of Dependency                      Rs.36,58,248/-
Funeral Expenses                      Rs.    5,000/-
Loss of love and affection                   Rs.   50,000/-
Loss of estate                               Rs.   10,000/-
Loss of consortium                           Rs.   10,000/-
Total:                                                        Rs.37,33,248/-


   Thus, the total compensation payable to the appellants/claimants will  be
Rs.37,33,248/- with interest  @ 7.5% per annum  from the date of  filing  of
the  application  till  the  date  of  payment.  The  apportionment  of  the
compensation in favour of  the  appellants  is  as  per  the  Award  of  the
Tribunal.
15.  Accordingly, we allow this appeal in the above terms.  The  respondent-
Insurance Company shall  either  pay  the  compensation  by  way  of  demand
draft/drafts in favour of the appellants or deposit the same  with  interest
as awarded by the Motor Accidents Claims Tribunal within six weeks from  the
date of receipt of the copy of this judgment,  after  deducting  the  amount
already deposited.

2014- Aug. Part – http://judis.nic.in/supremecourt/filename=41857


|NON-REPORTABLE      |


                         IN THE SUPREME COURT OF INDIA
                         CIVIL APPELLATE JURISDICTION

                         CIVIL APPEAL NO.7158 OF 2014
                  (Arising out of SLP(C) NO. 4333 OF 2014)


SARALADEVI & ORS.                                 ………APPELLANTS

                                     Vs.

DIVISIONAL MANAGER, M/S ROYAL
SUNDARAM ALLIANCE INS. CO. LTD. & ANR.    …RESPONDENTS




                               J U D G M E N T


  V. GOPALA GOWDA, J.

     This appeal has been filed by the appellants  being  aggrieved  by  the
judgment dated 12.09.2012 passed in C.M.A. No.  690  of  2011  by  the  High
Court of Madras whereby the High Court reduced the compensation  awarded  at
Rs.37,33,248/- by the Motor Accidents Claims Tribunal and  re-determined  at
Rs.15,84,750/-.
2.  The necessary relevant facts are  stated  hereunder  to  appreciate  the
case of the appellants with a view and to ascertain whether  the  appellants
are entitled for the enhancement of compensation as prayed in this appeal.
     The deceased met with an accident on 28.01.2009 on account of rash  and
negligent driving of the motor vehicle bearing  registration  No.  TN-23-AF-
0048, which hit the back side of the deceased’s motor  cycle.  The  deceased
sustained grievous injuries and succumbed to the  same.  A  post-mortem  was
conducted on 29.01.2009 and inspection report was filed in CC.No.55 of  2009
before the Court of Judicial Magistrate No. II, Walajahpet by the  Inspector
of Police against the driver of the offending vehicle. The  prosecution  has
failed to prove  the  case  against  the  driver  beyond  reasonable  doubt,
therefore, the learned Judicial Magistrate had acquitted the driver  of  the
vehicle from the charge framed against him vide order dated 31.05.2010.
3.  The appellants - the widow, two daughters and bed-ridden aged mother  of
the deceased-Vasanthan  approached  the  Motor  Accidents  Claims  Tribunal,
Vellore (for short “MACT”) by filing claim petition  under  Section  166  of
the Motor Vehicles Act, 1988 (for short “the Act”) claiming compensation  of
Rs.45,00,000/- on account of death of their sole bread earner,  against  the
owner as well as the insurer of the vehicle. The  said  claim  petition  was
registered as M.C.O.P. No. 138 of 2009.
4.  The Insurance Company filed  its  counter  statement  stating  that  the
accident occurred only due to the negligent riding  of the  two  wheeler  by
the deceased-Vasanthan and that they are not liable to pay the  compensation
amount as claimed by the appellants.
5.  The MACT has conducted an  enquiry  by  giving  an  opportunity  to  the
parties to adduce evidence in  support  of  their  respective  claim.  Three
witnesses (PW-1 to PW-3) were examined on behalf of the appellants  and  the
exhibits were marked as  Exs. P-1 to  P-15. On  behalf  of  respondents  two
witnesses RW-1 and RW-2 were examined and exhibits were marked as  Exs.  R-1
and R-2.  The Tribunal on appreciation of pleadings and  legal  evidence  on
record came to the right conclusion and held that the accident occurred  due
to the negligence of the driver of the offending  vehicle.   Thereafter,  on
the basis of legal evidence on record the MACT  determined  the  quantum  of
compensation. For this purpose, the Tribunal has taken  the  monthly  salary
of the deceased at  Rs.50,809/-  as  per  the  salary  certificate  Exh.P-7.
Therefore, his annual income was fixed at Rs.6,09,708/-.  The  deceased  was
aged 58 years at the time of the accident and the  Tribunal  has  taken  the
multiplier as 8.   Therefore, the total  loss  of  income  of  the  deceased
would be Rs.48,77,664/-.  1/4th  of  this  amount  i.e.  Rs.12,19,416/-  was
deducted towards his  personal  expenses  as  his  dependents  are  four  in
number. Hence, the loss of dependency of the appellants  was  calculated  at
Rs.36,58,248/-. For funeral expenses, a sum of Rs.5,000/- was  awarded.  For
loss of estate Rs.10,000/- and for loss of consortium to the 1st  appellant,
a sum of Rs.10,000/- was granted. For loss of love and affection, a  sum  of
Rs.50,000/- was granted to the appellants. Thus, the Tribunal  has  assessed
the total compensation under different heads as mentioned above  and  passed
an award for a sum of Rs.37,33,248/- to the appellants with interest @  7.5%
from  the  date  of  petition  i.e.  08.06.2009  and  further  directed  the
Insurance Company to pay the said amount by indemnifying the  owner  of  the
vehicle as the same was insured with it.
6. The insurer i.e. the Royal Sundaram Alliance Insurance Company  Ltd.  had
challenged the correctness of the award passed by the Tribunal in favour  of
the appellants by filing an appeal before the High Court  of  Judicature  at
Madras seeking for the modification of the compensation  awarded  in  favour
of the appellants by the Tribunal contending that  the  same  is  excessive,
urging various grounds in support of its appeal.
7.  The High Court, after examining the facts,  evidence  and  circumstances
of the case, has held that as per the judgement in Sarla Verma  &  Ors.  vs.
Delhi Transport Corporation & Anr.[1]  the correct  multiplier  between  the
age group of 56-60 should have been 9 since the deceased  was  58  years  at
the time of his death. Further, the High  Court  held  that  if  the  actual
salary of Rs.50,809/- is  taken  into  consideration,  the  annual  loss  of
income of the deceased works out to Rs.6,09,708/- and 10% of the  amount  is
liable to be deducted towards income  tax  deduction.  10%  in  the  sum  of
Rs.6,09,708/- comes to Rs.60,970.80 and the  same  can  be  rounded  off  to
Rs.61,000/-.  If  so,  the  balance  amount  works   out   to   Rs.5,48,708-
(Rs.6,09,708/- minus Rs.61,000/-),  rounded  off  to  Rs.5,49,000/-  as  the
annual income of the deceased.  Hence, annual loss of income could be  fixed
at Rs.5,49,000/-. For the first two years,  the  loss  of  income  would  be
Rs.10,98,000/- (Rs.5,49,000/- x 2 years). For the balance 7 years, only  50%
annual income has to be taken into consideration as notional  income,  which
comes to Rs.19,21,500/- (Rs.2,74,500/- x  7  years).  Therefore,  the  total
loss of income works out to Rs.30,19,500/-. Further, the High Court  was  of
the opinion that 1/3rd amount is liable  to  be  deducted  towards  personal
expenses of the deceased. If this amount  is  deducted  out  of  the  annual
income of the deceased, the  balance  amount  works  out  to  Rs.20,13,000/-
which  amounts  to  a  total  loss  of  dependency   (Rs.30,19,500/-   minus
Rs.10,06,500/-). The High Court further  held  that  there  is  contributory
negligence on the part of the deceased  which  was  assessed  at  25%  which
amount would be  Rs.5,03,250/-.   When  this  amount  was  deducted  out  of
Rs.20,13,000/-, the High Court  held that the legal heirs  of  the  deceased
are entitled to Rs.15,09,750/- towards loss of dependency.
           Thus, the High Court reduced the total compensation  and  awarded
under the following heads:
Loss of Dependency                            Rs.15,09,750/-
Funeral Expenses                         Rs.    5,000/-
Loss     of     Estate                                    Rs.       10,000/-

Loss      of      Consortium                            Rs.         10,000/-

Loss of love and affection               Rs.   50,000/-
Total   :                                     Rs.15,84,750/-


8.  Thus, the High Court  while  partly  allowing  the  Civil  Miscellaneous
Appeal of the Insurance Company, directed  it  to  deposit  the  above  said
amount with an interest at the rate of 7.5% per annum from the date  of  the
petition, within a period of six weeks before the Tribunal  after  deducting
the amount already deposited.
9.  Aggrieved by the impugned judgement and  final  Order  dated  12.09.2012
passed by the High Court, the  appellants  filed  this  appeal  before  this
Court urging various tenable grounds namely, as to whether  the  High  Court
was justified in holding that there is  a  contributory  negligence  on  the
part of the deceased contrary to the evidence of the  eye  witness;  whether
the High Court was justified in fixing the ratio of contributory  negligence
as 25% on the part of the deceased on the basis  of  an  erroneous  finding;
whether the High Court was justified in reducing the amounts awarded by  the
Tribunal from Rs.37,33,248/- to Rs.15,84,750/- and lastly, whether the  High
Court was justified in deducting 1/3rd amount towards personal  expenses  of
the deceased contrary to  the  law  laid  down  by  this  Court  in  various
judgements?
10.  In our considered view, the High Court has  erred  in  not  considering
the principles laid down in the case of Sarla Verma &  Ors.  (supra)  in  so
far as deduction of 1/4th of the monthly income of the  deceased  to  arrive
at the multiplicand and reducing the compensation by adopting the  split  up
multiplier.  Further, recording the finding of  contributory  negligence  on
the part of the deceased in the  absence  of  evidence  on  record  in  this
regard rendered the finding erroneous in law and error in law  as  the  same
is contrary to the decision of this Court  reported  in  Jiju  Kuruvila  and
Ors. v. Kunjujamma Mohan & Ors.[2]. At the time of death, Vasanthan  was  58
years  old  and  was  earning  a  salary  of  Rs.50,809/-  per  month   i.e.
Rs.6,09,708/- annually. By applying the appropriate multiplier of 8 as  laid
down under Kerala Road Transport Corporation v. Susamma Thomas[3], the  loss
of dependency comes to Rs.48,77,708/-.
11.  Further, deduction towards personal expenses of  the  deceased  out  of
the annual income would be 1/4th  as held by  this  Court  in  the  case  of
Sarla Verma & Ors.(supra), the relevant portion of the judgment  reads  thus
: –
“30. Though in some cases the deduction to be  made  towards  personal   and
living expenses is calculated on   the   basis   of   units   indicated   in
Trilok Chandra,   the   general   practice   is   to   apply    standardised
deductions. Having considered several subsequent decisions  of  this  Court,
we are of the view that  where  the  deceased  was  married,  the  deduction
towards personal and living expenses of the deceased,  should  be  one-third
(1/3rd) where the number of dependent family members is 2 to  3,  one-fourth
(1/4th) where the number of dependent family members is 4  to  6,  and  one-
fifth (1/5th) where the number of dependent family members exceeds six.”

      The High Court failed to follow the above judgement and  committed  an
error in law in deducting 1/3rd amount  towards  personal  expenses  of  the
deceased. Therefore, as per the above judgement the deduction  ought  to  be
1/4th only as correctly calculated by the Tribunal.  Thus,  after  deducting
1/4th  i.e.  Rs.12,19,416/-  towards  personal   expenses;   the   loss   of
dependency would be Rs.36,58,248/. Further, we affirm  the  sum  granted  by
the Tribunal as Rs.5,000/- for funeral expenses, under the head of  loss  of
estate at Rs.10,000/-, loss of consortium  at  Rs.10,000/-  and  Rs.50,000/-
for loss of love and affection of the deceased.

12.     Further, the High Court has erred in not following the  decision  of
Rajesh and Ors. v. Rajbir Singh and Ors.[4]  by  awarding  only  Rs.10,000/-
for loss of consortium, instead of Rs.1,00,000/-. Towards  loss  of  estate,
the High Court awarded Rs.10,000/- instead of  Rs.1,00,000/.  Therefore,  to
this extent there is loss caused to the appellants in not being  compensated
correctly under different  heads  such  as,  loss  of  consortium,  loss  of
estate,  and  loss  of  love  and  affection.  Further,  as  per   Municipal
Corporation of Delhi v. Uphaar Tragedy Victims Association  &  Ors.[5],  the
appellants are entitled for  9%  interest  per  annum  on  the  compensation
awarded from the date  of  filing  of  the  application  till  the  date  of
payment. Thus, there will be a difference of 1.5%  interest  amount  payable
on the total compensation awarded by both the Tribunal and  the  High  Court
as they have awarded at  7.5%  interest.  Therefore,  if  the  less  awarded
difference of interest amount @ 1.5%  by both  the  Tribunal  and  the  High
Court is taken into consideration  on  the  total  compensation  awarded  in
favour of the appellants,  it  would  take  care  of  the  amount  that  was
required to be  deducted towards income tax out of the gross salary  of  the
deceased for determining the compensation  under  the  heading  of  loss  of
dependency.
13.      Since,  the  High  Court  has  erred  in  not  correctly   awarding
compensation under the above heads  and  having  regard  to  the  facts  and
circumstances of the case, we affirm the Award of the Tribunal and the  same
is restored.
     Therefore,  the  determination  of  compensation  under  the  loss   of
dependency under other heads as indicated  in  the  following  paragraph  is
perfectly legal and valid as the said compensation is  just  and  reasonable
keeping in view the monthly income at Rs.50,809/-  as  per  the  documentary
evidence (Ex.P-7), the salary certificate.
14.   In the result, the impugned judgment and order of the  High  Court  is
liable to be set aside and accordingly  set  aside  and  the  Award  of  the
Tribunal is  affirmed.  Therefore,  the  appellants  shall  be  entitled  to
compensation under the following heads:

Loss of Dependency                      Rs.36,58,248/-
Funeral Expenses                      Rs.    5,000/-
Loss of love and affection                   Rs.   50,000/-
Loss of estate                               Rs.   10,000/-
Loss of consortium                           Rs.   10,000/-
Total:                                                        Rs.37,33,248/-


   Thus, the total compensation payable to the appellants/claimants will  be
Rs.37,33,248/- with interest  @ 7.5% per annum  from the date of  filing  of
the  application  till  the  date  of  payment.  The  apportionment  of  the
compensation in favour of  the  appellants  is  as  per  the  Award  of  the
Tribunal.
15.  Accordingly, we allow this appeal in the above terms.  The  respondent-
Insurance Company shall  either  pay  the  compensation  by  way  of  demand
draft/drafts in favour of the appellants or deposit the same  with  interest
as awarded by the Motor Accidents Claims Tribunal within six weeks from  the
date of receipt of the copy of this judgment,  after  deducting  the  amount
already deposited.

                                                    …………………………………………………………J.
                              [DIPAK MISRA]



                                                    …………………………………………………………J.
                                   [V. GOPALA GOWDA]


New Delhi,
August 20, 2014

-----------------------
[1]
      [2] (2009) 6 SCC 121
[3]
      [4] (2013) 9 SCC 166
[5]
      [6] AIR 1994 SC 1631
[7]
      [8] (2013) 9 SCC 54
[9]
      [10] (2011) 14 SCC 481

Specific performance - sale agreement obtained from two brothers only not valid - The said agreement is not enforceable in law in view of Section 17 of the Specific Relief Act in view of right accrued in favour of defendant Nos. 3 to 6 under Section 8 of the Hindu Succession Act. The provisions of Section 17 of the Specific Relief Act in categorical term expressly state that a Contract to sell or let any immovable property cannot be specifically enforced in favour of a vendor or lessor who does not have absolute title and right upon the party. Though, the defendants on merits have succeeded in this case for the reasons recorded by us on the substantial questions of law that have been framed by us on appreciation of facts and legal evidence on record, having regard to the peculiar facts and circumstances of the case particularly, the execution of Agreement of Sale, Ex. A-1 by defendant Nos. 1 and 2 on 3.5.1993, after receiving part consideration of Rs.15,000/-, and the submission made by the learned counsel for the defendants, it would be just and proper for this Court to award a sum of Rs.6,00,000/- by lump-sum amount of compensation to the plaintiffs within 3 months from the date of receipt of a copy of this judgment as provided under Section 22 of the Specific Relief Act.= CIVIL APPEAL NO. 7835 OF 2014 (Arising out of SLP(C) NO. 24653 OF 2012) PEMMADA PRABHAKAR & ORS. …APPELLANTS Vs. YOUNGMEN’S VYSYA ASSOCIATION & ORS. …RESPONDENTS = 2014- Aug. Part – http://judis.nic.in/supremecourt/filename=41856

   Specific performance - sale agreement obtained from two brothers only not valid - The  said agreement is not enforceable in law in view of Section 17  of  the  Specific Relief Act in view of right accrued in favour  of  defendant  Nos.  3  to  6 under Section 8 of the Hindu Succession Act. The provisions  of  Section  17 of the Specific Relief Act  in  categorical  term  expressly  state  that  a Contract to sell or  let  any  immovable  property  cannot  be  specifically
enforced in favour of a vendor or lessor who does not  have  absolute  title and right upon the party. Though,  the  defendants  on merits have succeeded in this case for the reasons recorded  by  us  on  the substantial questions of law that have been framed by us on appreciation  of
facts and legal evidence on record, having regard to the peculiar facts  and circumstances of the case particularly, the execution of Agreement of  Sale, Ex. A-1 by defendant  Nos.  1  and  2  on  3.5.1993,  after  receiving  part consideration of  Rs.15,000/-,  and  the  submission  made  by  the  learned counsel for the defendants, it would be just and proper for  this  Court  to award a sum of Rs.6,00,000/- by  lump-sum  amount  of  compensation  to  the plaintiffs within 3 months from the date  of  receipt  of  a  copy  of  this judgment as provided under Section 22 of the Specific Relief Act.=

 the  suit  schedule  property  is  self
acquired property by  late           Pemmada  Venkateswara  Rao  as  he  had
purchased the      said property vide Sale-Deed  Document  No.5174  of  1970
dated 24.11.1970 from his vendors.
It is also an undisputed  fact  that  the
said property is intestate property. He is survived by his wife, 3 sons  and
3 daughters.
The said property devolved upon them in view of  Section  8  of
Chapter 2 of the Hindu Succession Act as the defendants are  class  I  legal
heirs in the suit schedule property.
Undisputedly, the  Agreement  of  Sale-
Ex.-A1 is executed only by defendant Nos. 1 and 2. 
The 3rd  son, mother  and
3  sisters  who have got equal shares in the property have not executed  the
Agreement of Sale.
In view of the matter, the Agreement of Sale executed  by
defendant Nos. 1 and 2 who have no absolute right to  property  in  question
cannot confer any right whatsoever upon the plaintiffs for grant  of  decree
of specific performance of Agreement of  Sale  in  their  favour.

 Whether the plaintiffs are entitled  for  the  decree  for  specific
performance  of the Agreement of Sale  (Ex.-A1)        
when  Agreement  of
Sale entered between the plaintiffs and defendant  Nos.  1  and  2
who do not have absolute title to the property?

Whether in the absence of execution of the Agreement of Sale-Ex.-A1  by  the
other defendants/co-sharers is it valid, even  assuming  that  Agreement  of
Sale is valid, there is breach of terms and conditions of  the  Contract  on
the part of the plaintiffs in not paying the sale  consideration  amount  of
Rs. 1,70,000/- within  10  days  from  the  day  of  vacating  the  tenants,
Rs.50,000/- on 30.11.1993 and  an  amount  of  Rs.1,50,000/-  on  or  before
30.3.1994 to the defendants  and  plaintiffs  are  entitled  for  decree  of
specific performance of the Agreement of Sale?

Whether the plaintiffs are entitled for  discretionary  relief  of  specific
performance under Section 20(2) of the Specific Relief Act when it  has  not
approached the court with clean hands?

What relief?

  Answer to Point No. 1

29.   It is an undisputed fact that  the  suit  schedule  property  is  self
acquired property by  late           Pemmada  Venkateswara  Rao  as  he  had
purchased the      said property vide Sale-Deed  Document  No.5174  of  1970
dated 24.11.1970 from his vendors.
It is also an undisputed  fact  that  the
said property is intestate property. He is survived by his wife, 3 sons  and
3 daughters.
The said property devolved upon them in view of  Section  8  of
Chapter 2 of the Hindu Succession Act as the defendants are  class  I  legal
heirs in the suit schedule property.
Undisputedly, the  Agreement  of  Sale-
Ex.-A1 is executed only by defendant Nos. 1 and 2. 
The 3rd  son, mother  and
3  sisters  who have got equal shares in the property have not executed  the
Agreement of Sale.
In view of the matter, the Agreement of Sale executed  by
defendant Nos. 1 and 2 who have no absolute right to  property  in  question
cannot confer any right whatsoever upon the plaintiffs for grant  of  decree
of specific performance of Agreement of  Sale  in  their  favour.
The  said
agreement is not enforceable in law in view of Section 17  of  the  Specific
Relief Act in view of right accrued in favour  of  defendant  Nos.  3  to  6
under Section 8 of the Hindu Succession Act. The provisions  of  Section  17
of the Specific Relief Act  in  categorical  term  expressly  state  that  a
Contract to sell or  let  any  immovable  property  cannot  be  specifically
enforced in favour of a vendor or lessor who does not  have  absolute  title
and right upon the party.
It is worthwhile to  extract  Section  17  of  the
Specific Relief Act,1963 here :-
“17.-Contract to sell  or  let  property  by  one  who  has  no  title,  not
specifically enforceable.- A contract to sell or let any immovable  property
cannot be specifically enforced in favour of a vendor or lessor;

(a) who, knowing not to have any title to the property,  has  contracted  to
sell or let the property

(b) who, though he entered into the contract believing that he  had  a  good
title to the property, cannot at the time fixed by the  parties  or  by  the
court for the completion  of the sale or  letting,  give  the  purchaser  or
lessee a title free from reasonable doubt.”

In view of  the  aforesaid  provisions  of  the  Specific  Relief  Act,  the
Agreement of Sale entered between the plaintiffs and some of the  co-sharers
who do not have the absolute title to the  suit  schedule  property  is  not
enforceable in law.  This  aspect  of  the  matter  has  not  been  properly
appreciated and considered by both the First Appellate Court and the  Second
Appellate Court. Therefore, the impugned judgment is vitiated in law.

30.   Even assuming for the sake of argument that the  agreement  is  valid,
the names of three sons are mentioned in Agreement of Sale, out of whom  the
agreement is executed by defendant Nos. 1 and 2 and they assured  that  they
would get the signatures of the 3rd brother namely, Srinivasa Rao  and  also
the remaining 3  sisters.  At  the  time  of  execution  of  this  agreement
signatures were not obtained. Therefore, the agreement is  not  executed  by
all the co-sharers of the property which fact is evident from  the  recitals
of the document itself. Hence, the plaintiffs are not entitled for  specific
performance decree.
This vital factual and legal aspect has been ignored  by
both the First Appellate Court and the Second  Appellate  Court.
Therefore,
the impugned judgment is vitiated both on facts and  law.  Accordingly,  the
point No. 1 is answered in favour of the defendants.

Answer to Point No. 2

31.   The  second  point  is  also  required  to  be  answered  against  the
plaintiffs for the following reasons:-

As could be seen from the Agreement of Sale document marked  as  Ex.-A1  and
the pleadings of the parties payment of sale consideration was agreed to  be
paid to the defendant Nos. 1 and 2 as per following  terms of the  agreement
:-
“…
(i) an amount of Rs.1,70,000/- shall be paid by Vendee to Vendors  within
10 days from the day of vacating the tenants  in  the  property,
(ii)  Rs.
50,000/-  shall  be  paid  on  30.11.1993.,
 (iii)   the   remaining   sale
consideration of Rs.1,50,000/- shall be paid on or before 30.3.1994.”


32.   It is an  undisputed  fact  that  except  payment  of  Rs.5,000/-  and
Rs.10,000/- paid by the purchaser-plaintiff No.1 to  the  defendant  Nos.  1
and 2 according to the Agreement of Sale, the remaining installment i.e.  an
amount of Rs.1,70,000/- which was to be paid to the Vendors within  10  days
from the day of vacating the tenants in the  property  was  not  paid.
 Even
assuming that the amount could have been paid had the  tenants  vacated  the
schedule property then the remaining part of the sale  consideration  agreed
to be paid as notified  under  clauses  (ii)  and  (iii)  as  per  aforesaid
paragraph of the Agreement of Sale undisputedly not paid  to  the  defendant
Nos. 1 and 2.
Therefore, there is breach of contract  on  the  part  of  the
plaintiffs as could be  seen  from  the  agreement  of  sale  regarding  the
payment  of  part  sale  consideration  amount. 
 For  this   reason   itself
plaintiffs are not entitled for a decree of specific performance.

Answer to the Point Nos. 3

33.   Point No. 3 is also answered in  favour  of  the  defendants  for  the
following reasons:-
It is an undisputed fact that the plaintiffs have not approached  the  Trial
Court with clean hands.
 It is evident from the pleadings  of  the  Agreement
of Sale which is  produced  for  the  decree  for  specific  performance  of
Agreement of Sale as the plaintiffs did not obtain  the  signatures  of  all
the co-sharers of the property namely, the mother  of  the  defendants,  the
third brother and 3 sisters.
Therefore, the agreement is not enforceable  in
law as the persons who have  executed  the  sale  deed,  did  not  have  the
absolute title of the property.
Apart from the said legal lacuna, the  terms
and conditions of the Agreement of Sale for payment  of  sale  consideration
agreed to be paid by the first plaintiff in installments within  the  period
stipulated as indicated above were not paid.
The First Appellate  Court  and
the High Court have not exercised their power under  Section  20(2)  of  the
Specific Relief Act which by itself  is  the  substantial  question  of  law
which fell for consideration before the High Court as  the  First  Appellate
Court failed to consider this important aspect of the matter  and  exercised
its power while determining the rights of the party,  particularly,  in  the
light of the unenforceable  contract  between  the  plaintiffs  against  the
defendants as all of them are not parties to the Agreement of Sale  document
 (Ex.-A1) and the executants viz. defendant Nos. 1 and 2 have  not  acquired
absolute  title  to  the  property  in  question.  Therefore,  the  impugned
judgment is vitiated and liable to be set aside.

Answer to Point No. 4

34.   Though we have answered the questions of law framed in this appeal  in
favour of the defendants, the learned counsel for the defendants during  the
course of arguments, has offered some monetary  compensation  in  favour  of
the plaintiffs if this Court set aside the impugned judgment and  decree  of
specific performance granted in their  favour.  Though,  the  defendants  on
merits have succeeded in this case for the reasons recorded  by  us  on  the
substantial questions of law that have been framed by us on appreciation  of
facts and legal evidence on record, having regard to the peculiar facts  and
circumstances of the case particularly, the execution of Agreement of  Sale,
Ex. A-1 by defendant  Nos.  1  and  2  on  3.5.1993,  after  receiving  part
consideration of  Rs.15,000/-,  and  the  submission  made  by  the  learned
counsel for the defendants, it would be just and proper for  this  Court  to
award a sum of Rs.6,00,000/- by  lump-sum  amount  of  compensation  to  the
plaintiffs within 3 months from the date  of  receipt  of  a  copy  of  this
judgment as provided under Section 22 of the Specific Relief Act.

35.   Since, we have answered point Nos. 1 to 4 in favour of the  defendants
and against the plaintiffs, the  appeal  of  the  defendants  must  succeed.
Accordingly, the impugned judgment and decree passed by the  High  Court  in
affirming the judgment and decree of  the  First  Appellate  Court,  is  set
aside. The  judgment  and  decree  of  the  Trial  Court  is  restored  with
modification that the defendants shall pay a sum  of  Rs.6,00,000/-  to  the
plaintiffs as lump-sum  compensation  within  3  months  from  the  date  of
receipt of copy of this order. The appeal  is  allowed  in  the  above  said
terms. No costs.
  

2014- Aug. Part – http://judis.nic.in/supremecourt/filename=41856


                                                         REPORTABLE

                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION

                        CIVIL APPEAL NO. 7835 OF 2014
                  (Arising out of SLP(C) NO. 24653 OF 2012)


 PEMMADA PRABHAKAR & ORS.               …APPELLANTS

                                     Vs.

             YOUNGMEN’S VYSYA ASSOCIATION & ORS.    …RESPONDENTS





                               J U D G M E N T



V.GOPALA GOWDA, J.

Leave granted.

2.    This appeal has been filed against the judgment and final order  dated
04.11.2011 passed in the Second Appeal No. 815 of 2011 by the High Court  of
Judicature of Andhra Pradesh  at  Hyderabad,  whereby  the  High  Court  has
dismissed the Second Appeal.

3.    Certain relevant facts are stated for the purpose of appreciating  the
rival legal contentions urged on behalf  of  the  parties  with  a  view  to
examine the correctness of the findings and reasons  recorded  by  the  High
Court in the impugned judgment.

For the sake of brevity and convenience, the parties  are  referred  to   in
this judgment as per  the  rank  assigned  to  them  in  the  original  suit
proceedings.

4.    The property bearing Door No. 20/42-1-9 with land measuring about 657-
1/3rd sq. yards situated to the  west  of  Vallabhai  Street,  Cinema  Road,
Kakinada (hereinafter, referred to as the ‘suit schedule property’) was  the
self acquired property of one Pemmada Venkateswara Rao.  He  died  intestate
and survived by wife Syama Sundari, three  sons  and  three  daughters  (the
defendant Nos. 1 to 6).

5.     The  plaintiffs-the  Youngmen’s  Vyasa  Association  (who   are   the
respondents  herein),  instituted  O.S.No.267  of  1995  for  the   specific
performance of Agreement of Sale dated  03.05.1993  against  the  defendants
(the appellants herein). The plaintiffs alleged that the  defendant  Nos.  1
and 2, who are managing the suit schedule property, agreed to sell the  same
to plaintiff No. 1.

6.    According to the plaintiffs, the defendant Nos. 1 and 2  executed  the
Agreement of Sale dated 03.05.1993 in favour of plaintiff No. 1 agreeing  to
sell the suit schedule property at the rate of Rs.575/- per  sq.  yard,  the
total consideration of which was to be fixed later after taking  the  actual
measurement. Later on, the total land value was fixed at  Rs.3,77,967/-  for
657-1/3 sq. yards. The defendant Nos. 1 and 2  received  advance  amount  of
Rs.5000/- and Rs.10,000/- also. Under the  Agreement  the  plaintiff  No.  1
agreed to pay Rs.1,70,000/- to the defendants within 10 days  from  the  day
of vacating the tenants from the suit schedule property. Rs.50,000/- was  to
be paid on 30.11.1993 and that the balance amount of  Rs.1,50,000/-  was  to
be paid by 30.3.1994. The defendant Nos. 1 and  2  agreed  that  they  would
obtain the signatures of their  3rd  brother-the  defendant       No.  3  by
9.05.1993. Defendant Nos. 7 and 8 are the tenants in the sheds  situated  in
the suit schedule property. The  defendant  Nos.1  &  2  stated  that  their
sisters were married long ago therefore, they had no interest  in  the  suit
schedule property, and that they would also get the sisters’  signatures  on
the agreement.

7.    The 2nd Addl. Senior Civil Judge, Kakinada (the Trial  Court)  by  his
judgment dated 12.7.2006 dismissed O.S. No 267/95, in so  far  as  the  main
relief for the specific performance of sale is concerned.  The  Trial  Court
has directed the defendants to refund Rs.5000/- with interest  at  the  rate
of 12% p.a. from 5.03.1993 till the  date  of  realization  and  Rs.10,000/-
with the interest  rate  at  12%  p.a.  from  6.08.1993  till  the  date  of
realization.

8.    The Trial Court after considering the oral  and  documentary  evidence
on record, observed that as the suit schedule property is  adjacent  to  the
plaintiff’s property, taking advantage  of  the  financial  difficulties  of
defendant Nos. 1 and 2, the plaintiffs attempted to grab the  suit  schedule
property and dragged the defendants to the court of law.

9.    The Trial Court further held that the Agreement of Sale was not  valid
as the defendant Nos.3 to 6 and their mother did not give  consent  to  sell
the suit schedule property to the plaintiffs. Accordingly, the  main  relief
for specific performance was rejected and the defendants  were  directed  to
refund the amount of advance  sale  consideration  to  the  plaintiffs  with
interest at the rate of 12% p.a.

10.   Being aggrieved by the judgment and  decree  dated  12.7.2006  of  the
Trial Court, the plaintiffs filed an appeal  being  A.S.  No.  269  of  2006
before the Court of 3rd  Additional  District  Judge,  Kakinada,  the  First
Appellate Court.

11.   On 28.04.2010 the First Appellate Court  allowed  the  appeal  partly,
directing the defendant Nos. 1, 2, 4 and 5 to execute  the  registered  sale
deed in favour of the plaintiff’s Association  in  respect  of  their  1/6th
share each i.e. 4/6th share by receiving  their  respective  shares  of  the
balance sale consideration from the plaintiffs and modified the  decree  for
specific performance of Agreement of Sale.

12.   The First Appellate Court vide its order  dated  28.4.2010  held  that
the transaction between the parties is real sale transaction  and  not  mere
money transaction and the sale agreement is valid and  binding  between  the
parties and the plaintiffs  are  entitled  for  the  first  main  relief  of
specific performance and directed defendant Nos. 1, 2, 4 and  5  to  execute
sale deed in respect of their 4 shares of the suit schedule  property  after
receiving proportionate sale price.

13.   Being aggrieved by the judgment and decree  dated  28.04.2010  of  the
First Appellate Court, the defendants preferred  Second  Appeal  being  S.A.
No. 815 of 2011 before the High Court of Judicature  of  Andhra  Pradesh  at
Hyderabad  whereby the High Court vide order dated 4.11.2011  dismissed  the
Second Appeal which is impugned in this appeal.

14.   The High Court held that the approach of the First Appellate Court  in
granting the relief of specific performance directing  defendants  1,  2,  4
and 5 to execute sale deed in respect of their shares, i.e. 4/6th  share  of
the suit schedule property in favour of the plaintiffs on receipt  of  their
respective balance consideration which stood deposited in the court,  cannot
be faulted with.

15.   It was further  held  by  the  High  Court  that  the  mother  of  the
defendants was alive when the suit was instituted in 1995 and  she  died  on
29.09.2005. She had one share and after her death,  the  property  would  be
divided into 6  shares  and  the  agreement  was  held  as  binding  on  the
defendants 1, 2, 4 and 5. Therefore, the High Court upheld the  decision  of
the First Appellate Court and moulded the relief in the  above  terms  while
granting decree  of  specific  performance  of  the  Agreement  of  Sale  by
executing the sale deed of their share in the  property  in  favour  of  the
plaintiffs.

16.   The following submissions were made by the learned  counsel  for  both
the parties in support of their claim and counter claim.

17.   On behalf of the defendant Nos.1 &  2,  it  is  contended  that  their
father Pemmada Venkateswara Rao was engaged in lathe  works  which  incurred
heavy loss  and  he  was  allegedly  indebted  to  various  creditors.  They
approached one Murali Krishna (who had acquaintance with them) who  was  the
Secretary  of  the  plaintiff  Association  to  borrow  some  money.  Taking
advantage of their  situation,  the  Secretary  and  the  President  of  the
Plaintiff Association obtained the signatures of defendant Nos. 1 and  2  on
a blank sheet of paper and gave Rs.5000/- on  3.5.1993  and  Rs.10,000/-  on
6.8.1993 to them.

18.   It was further contended by the learned counsel  that  the  defendants
never intended to sell the suit schedule property and the  transaction  with
the plaintiffs Association was only money transaction and  was  not  a  sale
transaction with it. A separate written  statement  was  filed  by  the  4th
defendant to the same effect.

19.   It was further contended by defendant Nos. 1 to 6  that  even  on  the
date of execution of Agreement of Sale their  mother  was  very  much  alive
and, therefore in the absence of execution of Agreement of Sale by  all  the
seven co-sharers of  the  suit  schedule  property  the  suit  for  specific
performance does not lie. The learned  counsel  for  the  defendants  placed
reliance on the decisions of Andhra Pradesh High Court  and  this  Court  in
the cases of Kommisetti Venkatasubbayya v. Karamestti  Venkateswarlu[1]  and
Lourdu Mari David & Ors. v. Louis Chinnaya Arogiaswamy & Ors.[2] in  support
of their claim.

20.   Further,  they  placed  reliance  upon  the  case  of  this  Court  in
Rameshwar & Ors. v. Jot Ram & Anr.[3]. In the said authority   it  has  been
held as follows:

“9…First, its bearing on the right of action, second, on the nature  of  the
relief and third, on its impotence to create or destroy substantive  rights.
Where the nature of the relief, as originally sought,  has  become  obsolete
or unserviceable or a new  form  of  relief  will  be  more  efficacious  on
account of developments subsequent to the suit or even during the  appellate
stage, it is but fair that the relief is moulded, varied or reshaped in  the
light  of  updated  facts.  Patterson  illustrates  this  position.  It   is
important that the party claiming the relief or change of relief  must  have
the same right from which either the first or the modified remedy may  flow.
Subsequent events in the course  of  the  case  cannot  be  constitutive  of
substantive rights enforceable in that very litigation except  in  a  narrow
category (later spelt out) but may influence the equitable  jurisdiction  to
mould reliefs. Conversely, where rights have  already  vested  in  a  party,
they cannot be nullified or negated by subsequent events  save  where  there
is a change in the law and it is made applicable at any  stage.  Lachmeshwar
Prasad Shukul v. Keshwar Lal Chaudhuri falls in  this  category.  Courts  of
justice may, when the compelling equities  of  a  case  oblige  them,  shape
reliefs — cannot deny rights — to make them justly relevant in  the  updated
circumstances. Where the relief is discretionary, courts may  exercise  this
jurisdiction to avoid injustice. Likewise, where the  right  to  the  remedy
depends, under the statute itself, on the presence  or  absence  of  certain
basic facts at the time the relief is to be ultimately granted,  the  Court,
even in appeal, can take note of such  supervening  facts  with  fundamental
impact…”
                               (Emphasis supplied)


21.    The High court held that defendants pleaded falsehood at the time  of
execution of the  Agreement  of  Sale  by  stating  that  their  mother  had
predeceased their father. The agreement and the endorsement thereon made  by
defendant Nos.1 and 2 had swayed discretion of the High Court in  favour  of
the plaintiffs which is  an  Association  engaged  in  the  welfare  of  the
community.

22.   The High Court further held that the suit schedule  property  was  not
purchased for unlawful gain of an individual and that  the  First  Appellate
Court considered the entire evidence  on  record  and  exercised  its  sound
jurisdiction and modified the judgment of the  Trial  Court  by  granting  a
decree of specific performance as per the terms stipulated therein.

23.   The High Court dismissed the second appeal without  adverting  to  the
substantial questions of law that were framed  in the second appeal  at  the
admission stage itself stating  that there is  no  substantial  question  of
law  for  its  adjudication.  The  First  Appellate  Court  and  the  Second
Appellate Court committed serious error in law in not noticing the  relevant
important findings of fact recorded by the Trial Court  on  the  contentious
issues on proper appreciation of pleadings  and   evidence  on  record  with
reference to the legal submission made on behalf of the parties.  The  Trial
Court after proper appreciation of evidence on  record,  particularly,  Ex.-
A1, the Agreement of Sale, has held that it is not a valid agreement and  no
rights can flow from it in favour of the plaintiffs  in  the  light  of  the
fact that the signatures  of  defendant  Nos.  1  and  2  were  obtained  on
different dates on blank papers as they were in financial  crisis  and  that
fact is proved by producing Exs.-B1 to  B-8 to show that the  entire  family
(defendant Nos. 1 to 6) were in financial crisis and  they  were  forced  to
pay the debts to their creditors. Therefore, they were  in  urgent  need  of
money and they approached the PW-1 for  financial  help,  who  obtained  the
signatures of defendant Nos. 1 and  2  on  blank  paper  and  the  same  was
fabricated as a receipt. The said receipt was not signed by  defendant  Nos.
3 to 6. The mother of the defendant Nos. 1 and 2 is one  of  the  co-sharers
of the suit schedule property as a class-I legal heir  to  succeed   to  the
intestate property  of her deceased husband, which  was  his  self  acquired
property left by him, as he had purchased the same vide  Sale-Deed  document
No. 5174/1970 dated 24.11.1970  from  his  vendors.  In  fact,  there  is  a
reference made  in  this  regard  in  the  Agreement  of  Sale  executed  by
defendant Nos.  1  and  2  to  the  effect  that  after  demise  of  Pemmada
Venkateswara Rao, the father  of   defendant  Nos.  1  to  6,  the  property
devolved upon them jointly and they are enjoying with  absolute  rights.  As
per Section 8 of the  Hindu  Succession  Act,  1956  the  general  rules  of
succession  would  be  applicable   in  the  case  of  a  male  Hindu  dying
intestate, relevant portion of which reads as under :-

 “8. General rules of succession in the case of males.- The  property  of  a
male Hindu dying intestate shall devolve  according  to  the  provisions  of
this Chapter-

Firstly, upon the heirs, being the relatives specified in  class  I  of  the
Schedule;

XXX         XXX        XXX”

In the Schedule of the said Act, class I heirs  are  son,  daughter,  widow,
mother and others. In view of the enumeration of the class I  heirs  in  the
Schedule, the mother and sisters of the defendant Nos. 1 and 2 are also  co-
sharers   of  the  property  left  intestate   by   the   deceased   Pemmada
Venkateswara Rao. As  could  be  seen  from  the  Agreement  of  Sale-Ex.-A1
undisputedly, the third brother and 3 sisters, (defendant Nos. 3 to  6)  and
their mother have not executed the  Agreement  of  Sale  in  favour  of  the
plaintiffs. Therefore, the same is not enforceable under Section 17  of  the
Specific Relief Act, 1963.  The  mother  lived  upto  September,  2005,  the
aforesaid legal heirs of deceased Pemmada Venkateswara Rao got equal  shares
in the suit schedule property.

24.   It is further contended on behalf of the  defendants  that  the  First
Appellate Court and the High Court have failed in  not  applying  the  legal
principle laid down by this Court in the case of Lourdu Mari  David  &  Ors.
(supra), wherein this Court held that the party who seeks to  avail  of  the
equitable jurisdiction of a court  and  specific  performance  decree  being
equitable relief must come to the court with clean hands.  In  other  words,
the party who makes false allegations against the defendants does  not  come
with clean hands and therefore, it is not entitled to the  equitable  relief
of specific performance decree from the court.

25.    Another legal contention urged on behalf of the  defendants  is  that
the High Court has erroneously come to the conclusion on facts and  evidence
on record and it has affirmed the divergent findings  of  fact  recorded  by
the First Appellate Court without examining   and answering the  substantial
questions of law  framed  in  the  Second  Appeal  and  it  has  erroneously
dismissed the appeal  holding  that  the  suit  schedule  property  was  not
purchased by the plaintiffs for unlawful gain of  an  individual.  The  said
property is probably purchased by the plaintiffs to put it to  use  for  the
purpose of the community.  The High  Court  without  considering  the  legal
submissions urged on behalf of the defendants adjudicated the rights of  the
parties ignoring certain facts, evidence on  record  and  legal  contentions
urged.  It has erroneously held that the plaintiffs  are  entitled  for  the
relief  of  specific  performance  while  the  Agreement  of  Sale  is   not
enforceable under Section 17 of the Specific Relief Act, 1963,  in  view  of
the fact that all the legal heirs of the deceased Pemmada  Venkateswara  Rao
are not parties to the Agreement of Sale and the defendant Nos. 1 and  2  do
not have absolute title  and right upon the entire suit  schedule  property.
Even assuming for the sake of argument that the Agreement of Sale is  valid,
the same could  not  have  been  enforced  against  the  defendants  as  the
plaintiffs have committed breach of the contract as agreed upon by  them  as
per clause 2 of the penultimate paragraph Nos. 2 and 3 of the  Agreement  of
Sale. The plaintiffs gave a sum of Rs.5,000/- & Rs. 10,000/- as  an  advance
amount towards sale consideration  and  the  remaining  sale  consideration,
i.e.(i)an amount of Rs.1,70,000/- which was to be paid within 10  days  from
the day of vacating the tenants in the  property,  (ii)  Rs.50,000/-  to  be
paid on 30.11.1993 and the remaining sale consideration of Rs.1,50,000/-  to
be paid on or before 30.3.1994 was not paid to the defendant Nos. 1 and 2.

26.   It is also contended by the learned counsel that the  First  Appellate
Court and the Second Appellate Court have not exercised their  discretionary
powers as required under Section  20(2)  of  the  Specific  Relief  Act  for
decreeing the specific  performance   in  favour  of  the  plaintiffs,  even
though,  the defendants  have  made out a case before the Trial  Court  that
the plaintiffs are not entitled for the  decree  for  specific  performance.
Therefore,  the                   First  Appellate  Court  and  the   Second
Appellate Court have gravely erred in  not  exercising  their  discretionary
power under Section 20(2) of the Specific Relief Act at the time of  passing
decree for specific performance in favour of the plaintiffs,  which  is  not
only erroneous in law but also vitiated in law and therefore,  the  same  is
liable to be set aside.

27.   On the contrary, the learned counsel for          the  plaintiffs  has
sought  to  justify  the  impugned  judgment  contending  that  the   Second
Appellate Court in exercise of its appellate  jurisdiction  after  examining
the facts and evidence on record has held that the substantial questions  of
law framed by  the  defendants  in  the  second  appeal,  on  the  divergent
findings of fact recorded by the First  Appellate  Court  would  not  arise.
Decreeing the suit by the First Appellate Court as prayed by the  plaintiffs
is correct as it has set aside the decree of the Trial Court. It is  further
urged that the High Court is right  in  dismissing  the  second  appeal  and
therefore, the same does not call for interference by this  Court  as  there
is no substantial question of  law  which  would  arise  for  consideration.
Therefore, the learned counsel  for  the  respondent-plaintiffs  prayed  for
dismissal of this civil appeal as the same is devoid of merit.

28.   With reference to the above  said  rival  contentions,  the  following
points would arise for our consideration :-
Whether the plaintiffs are entitled          for  the  decree  for  specific
performance  of the Agreement of Sale  (Ex.-A1)          when  Agreement  of
Sale entered between           the plaintiffs and defendant  Nos.  1  and  2
who do not have absolute title to the property?

Whether in the absence of execution of the Agreement of Sale-Ex.-A1  by  the
other defendants/co-sharers is it valid, even  assuming  that  Agreement  of
Sale is valid, there is breach of terms and conditions of  the  Contract  on
the part of the plaintiffs in not paying the sale  consideration  amount  of
Rs. 1,70,000/- within  10  days  from  the  day  of  vacating  the  tenants,
Rs.50,000/- on 30.11.1993 and  an  amount  of  Rs.1,50,000/-  on  or  before
30.3.1994 to the defendants  and  plaintiffs  are  entitled  for  decree  of
specific performance of the Agreement of Sale?

Whether the plaintiffs are entitled for  discretionary  relief  of  specific
performance under Section 20(2) of the Specific Relief Act when it  has  not
approached the court with clean hands?

What relief?

  Answer to Point No. 1

29.   It is an undisputed fact that  the  suit  schedule  property  is  self
acquired property by  late           Pemmada  Venkateswara  Rao  as  he  had
purchased the      said property vide Sale-Deed  Document  No.5174  of  1970
dated 24.11.1970 from his vendors. It is also an undisputed  fact  that  the
said property is intestate property. He is survived by his wife, 3 sons  and
3 daughters. The said property devolved upon them in view of  Section  8  of
Chapter 2 of the Hindu Succession Act as the defendants are  class  I  legal
heirs in the suit schedule property. Undisputedly, the  Agreement  of  Sale-
Ex.-A1 is executed only by defendant Nos. 1 and 2. The 3rd  son, mother  and
3  sisters  who have got equal shares in the property have not executed  the
Agreement of Sale. In view of the matter, the Agreement of Sale executed  by
defendant Nos. 1 and 2 who have no absolute right to  property  in  question
cannot confer any right whatsoever upon the plaintiffs for grant  of  decree
of specific performance of Agreement of  Sale  in  their  favour.  The  said
agreement is not enforceable in law in view of Section 17  of  the  Specific
Relief Act in view of right accrued in favour  of  defendant  Nos.  3  to  6
under Section 8 of the Hindu Succession Act. The provisions  of  Section  17
of the Specific Relief Act  in  categorical  term  expressly  state  that  a
Contract to sell or  let  any  immovable  property  cannot  be  specifically
enforced in favour of a vendor or lessor who does not  have  absolute  title
and right upon the party. It is worthwhile to  extract  Section  17  of  the
Specific Relief Act,1963 here :-
“17.-Contract to sell  or  let  property  by  one  who  has  no  title,  not
specifically enforceable.- A contract to sell or let any immovable  property
cannot be specifically enforced in favour of a vendor or lessor;

(a) who, knowing not to have any title to the property,  has  contracted  to
sell or let the property

(b) who, though he entered into the contract believing that he  had  a  good
title to the property, cannot at the time fixed by the  parties  or  by  the
court for the completion  of the sale or  letting,  give  the  purchaser  or
lessee a title free from reasonable doubt.”

In view of  the  aforesaid  provisions  of  the  Specific  Relief  Act,  the
Agreement of Sale entered between the plaintiffs and some of the  co-sharers
who do not have the absolute title to the  suit  schedule  property  is  not
enforceable in law.  This  aspect  of  the  matter  has  not  been  properly
appreciated and considered by both the First Appellate Court and the  Second
Appellate Court. Therefore, the impugned judgment is vitiated in law.

30.   Even assuming for the sake of argument that the  agreement  is  valid,
the names of three sons are mentioned in Agreement of Sale, out of whom  the
agreement is executed by defendant Nos. 1 and 2 and they assured  that  they
would get the signatures of the 3rd brother namely, Srinivasa Rao  and  also
the remaining 3  sisters.  At  the  time  of  execution  of  this  agreement
signatures were not obtained. Therefore, the agreement is  not  executed  by
all the co-sharers of the property which fact is evident from  the  recitals
of the document itself. Hence, the plaintiffs are not entitled for  specific
performance decree. This vital factual and legal aspect has been ignored  by
both the First Appellate Court and the Second  Appellate  Court.  Therefore,
the impugned judgment is vitiated both on facts and  law.  Accordingly,  the
point No. 1 is answered in favour of the defendants.

Answer to Point No. 2

31.   The  second  point  is  also  required  to  be  answered  against  the
plaintiffs for the following reasons:-

As could be seen from the Agreement of Sale document marked  as  Ex.-A1  and
the pleadings of the parties payment of sale consideration was agreed to  be
paid to the defendant Nos. 1 and 2 as per following  terms of the  agreement
:-
“… (i) an amount of Rs.1,70,000/- shall be paid by Vendee to Vendors  within
10 days from the day of vacating the tenants  in  the  property,   (ii)  Rs.
50,000/-  shall  be  paid  on  30.11.1993.,   (iii)   the   remaining   sale
consideration of Rs.1,50,000/- shall be paid on or before 30.3.1994.”


32.   It is an  undisputed  fact  that  except  payment  of  Rs.5,000/-  and
Rs.10,000/- paid by the purchaser-plaintiff No.1 to  the  defendant  Nos.  1
and 2 according to the Agreement of Sale, the remaining installment i.e.  an
amount of Rs.1,70,000/- which was to be paid to the Vendors within  10  days
from the day of vacating the tenants in the  property  was  not  paid.  Even
assuming that the amount could have been paid had the  tenants  vacated  the
schedule property then the remaining part of the sale  consideration  agreed
to be paid as notified  under  clauses  (ii)  and  (iii)  as  per  aforesaid
paragraph of the Agreement of Sale undisputedly not paid  to  the  defendant
Nos. 1 and 2. Therefore, there is breach of contract  on  the  part  of  the
plaintiffs as could be  seen  from  the  agreement  of  sale  regarding  the
payment  of  part  sale  consideration  amount.  For  this   reason   itself
plaintiffs are not entitled for a decree of specific performance.

Answer to the Point Nos. 3

33.   Point No. 3 is also answered in  favour  of  the  defendants  for  the
following reasons:-
It is an undisputed fact that the plaintiffs have not approached  the  Trial
Court with clean hands. It is evident from the pleadings  of  the  Agreement
of Sale which is  produced  for  the  decree  for  specific  performance  of
Agreement of Sale as the plaintiffs did not obtain  the  signatures  of  all
the co-sharers of the property namely, the mother  of  the  defendants,  the
third brother and 3 sisters. Therefore, the agreement is not enforceable  in
law as the persons who have  executed  the  sale  deed,  did  not  have  the
absolute title of the property. Apart from the said legal lacuna, the  terms
and conditions of the Agreement of Sale for payment  of  sale  consideration
agreed to be paid by the first plaintiff in installments within  the  period
stipulated as indicated above were not paid. The First Appellate  Court  and
the High Court have not exercised their power under  Section  20(2)  of  the
Specific Relief Act which by itself  is  the  substantial  question  of  law
which fell for consideration before the High Court as  the  First  Appellate
Court failed to consider this important aspect of the matter  and  exercised
its power while determining the rights of the party,  particularly,  in  the
light of the unenforceable  contract  between  the  plaintiffs  against  the
defendants as all of them are not parties to the Agreement of Sale  document
 (Ex.-A1) and the executants viz. defendant Nos. 1 and 2 have  not  acquired
absolute  title  to  the  property  in  question.  Therefore,  the  impugned
judgment is vitiated and liable to be set aside.

Answer to Point No. 4

34.   Though we have answered the questions of law framed in this appeal  in
favour of the defendants, the learned counsel for the defendants during  the
course of arguments, has offered some monetary  compensation  in  favour  of
the plaintiffs if this Court set aside the impugned judgment and  decree  of
specific performance granted in their  favour.  Though,  the  defendants  on
merits have succeeded in this case for the reasons recorded  by  us  on  the
substantial questions of law that have been framed by us on appreciation  of
facts and legal evidence on record, having regard to the peculiar facts  and
circumstances of the case particularly, the execution of Agreement of  Sale,
Ex. A-1 by defendant  Nos.  1  and  2  on  3.5.1993,  after  receiving  part
consideration of  Rs.15,000/-,  and  the  submission  made  by  the  learned
counsel for the defendants, it would be just and proper for  this  Court  to
award a sum of Rs.6,00,000/- by  lump-sum  amount  of  compensation  to  the
plaintiffs within 3 months from the date  of  receipt  of  a  copy  of  this
judgment as provided under Section 22 of the Specific Relief Act.

35.   Since, we have answered point Nos. 1 to 4 in favour of the  defendants
and against the plaintiffs, the  appeal  of  the  defendants  must  succeed.
Accordingly, the impugned judgment and decree passed by the  High  Court  in
affirming the judgment and decree of  the  First  Appellate  Court,  is  set
aside. The  judgment  and  decree  of  the  Trial  Court  is  restored  with
modification that the defendants shall pay a sum  of  Rs.6,00,000/-  to  the
plaintiffs as lump-sum  compensation  within  3  months  from  the  date  of
receipt of copy of this order. The appeal  is  allowed  in  the  above  said
terms. No costs.



                                                ……………………………………………………………………J.
                                      [DIPAK MISRA]



                                                ……………………………………………………………………J.
                           [V. GOPALA GOWDA]

New Delhi,
August 20,2014
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[1]     A.I.R. 197?