TRIMBAK NARAYAN HARDAS Vs. BABULAL MOTAJI

JUDGEMENT

(1.) This appeal arises on a certificate granted by the High Court at Bombay from its judgment and decree dated April 17, 1963 in First Appeal No. 847 of 1957.

(2.) The appellant is one Trimbak Narayan Hardas, a resident of Amaravati where he lived after his retirement as a District Judge. Respondent No. 2 Krishnaji Mahadeo Jangli is a resident of Poona. He owned some house properties at Poona and at the relevant time had a small business of manufacturing rubber goods. Jangli was a distant relation of Hardas being the son of the sister of the father-in-law of Hardas. Jangli was in financial difficulties and so he borrowed moneys from Hardas. On 11-5-1949 he was paid Rs. 15,000/- by Bank Draft and again on 13-7-1949 another sum of Rs. 15,000/- was paid to him by a Bank Draft. In respect of these loans Jangli passed a Pronote in favour of Hardas on 12-7-1949. The loans were supposed to be accommodation loans which Jangli had promised to repay as early as possible. On 2-12-1950 he gave a cheque of Rs. 3,000/- to Hardas in part payment but on presentation to the Bank, it was dishonoured. The two met often and Hardas used to remind Jangli about the loan. There was also correspondence between them. Since Jangli was not able to satisfy the loan, Hardas naturally wanted some security for it, especially, as the period of limitation was fast expiring. Sometime in March, 1952 Hardas went to Poona and it seems that some talk as to the property which Hardas would be willing to take as security, took place. In all probability they did not agree as to which of Jangli's Poona properties should be offered as security. So Jangli went to Amaravati on or about 1-4-1952 and it was agreed between them that the matter may be referred to one Chaubal a retired Deputy Collector for his arbitration. Jangli gave the description of his property and on 2-4-1852 the statements of Hardas and Jangli were recorded by the arbitrator. Chaubal gave his award on 4-4-1952 and on the same day the award was filed in Amaravati court. The award was accepted by Hardas and Jangli and the award decree was drawn up on 7-4-1952. The decree was also registered on 29-5-1952. In accordance with this decree, Jangli was directed to pay Rs. 30 000/- with costs and interest within 3 months, in default of which he was liable to execute a sale deed in favour of Hardas of House No. 102 in Mangalwar Peth, Poona City. The decretal amount was also made a charge on house nos. 108, 109, 110, 111, 44 and 45 in Mangalwar Peth, Poona, belonging to Jangli. Jangli failed to pay the decretal amount and so Hardas filed his first petition of execution against Jangli on 30-3-1953 asking for the execution of the sale deed. Later he amended the petition by asking only for the attachment of Jangli's movables. Under that pressure, Jangli handed over possession of house no. 108 to Hardas whereafter Hardas allowed the execution petition to be disposed of without further action. In the meantime another creditor of Jangli filed an execution petition for the recovery of his decretal amount and in execution of the decree attached the property in the possession of Hardas. Hardas applied to the court for raising the attachment and the attachment was raised on 30-8-1954. Hardas continued to be in possession of house no. 108 Mangalwar Peth. The suit out of which the present appeal arises was filed by one Babulal Motaji, respondent no. 1 in the appeal before us. He filed the suit on 18-11-1954 after giving notice on 2-8-1954. The suit was for the specific performance of an agreement to sell house nos. 108, 109, 110 and 111 Mangalwar Peth executed by Jangli in favour of Babulal. The agreement is dated February 5, 1952 and is Exhibit 49. The suit was directed against Jangli and his four minor sons, defendants nos. 1 to 5 respectively. Hardas was also joined as a party being defendant no. 6. The plaintiff Babulal alleged that Jangli had executed an agreement to sell the property to him on behalf of himself and his minor sons for a sum of Rs. 50,000/- out of which Rs. 30,000/- had been received by Jangli as earnest money. The sale deed was to be executed within one year. But by agreement between them, endorsed on the document itself, the time was extended for six months in the first instance and then again for one year thereafter. The extended time expired on about the 5th of August, 1954 and since Jangli did not execute the sale deed, the plaintiff gave him notice on 2-8-1954. Before filing the suit the plaintiff obtained extracts of the City Survey records which disclosed that there was a charge on the property of Hardas, defendant no. 6. Plaintiff alleged that Jangli and Hardas had brought about a fraudulent and collusive award in order to defeat the plaintiff and hence he should be given a decree for specific performance against all. In the alternative, he asked for a decree for the amount of earnest money paid by him with interest thereon against Jangli and his minor sons.

(3.) Jangli, who was defendant no. 1, filed his written statement on behalf of himself and as the guardian of his minor sons. In this written statement, he admitted practically all the allegations of the plaintiff. On the other hand, he disputed the award in favour of Hardas. After this the plaintiff found that the interests of Jangli and his minor sons were conflicting and, therefore, applied for the representation of the minors by their mother. The mother contested the suit denying the transaction with the plaintiff or the receipt of the money. She further alleged that there was no legal necessity or benefit to the estate and hence the minor sons were not bound by the agreement. Hardas, defendant no. 6, affirmed his transaction as a genuine one and alleged that the suit was a collusive suit between plaintiff and defendant no. 1 with a view to defeat defendant no. 6. It was suggested that there was really no genuine transaction of an agreement to sell and the document must have come into existence sometime when the execution petition had been filed by defendant no. 6 against defendant no. 1. It is necessary to note here that after filing the written statement admitting the plaintiff's claim defendant no. 1 did not take part in the further proceedings. Thus there was a double contest - one between the plaintiff and the minor sons of Jangli; another between the plaintiff and Hardas.