UNNOOLI ALIAS KUTTIMALU Vs. YYU

JUDGEMENT

(1.) This Civil Revision Petition, stemming from a small cause, has raised thorny problems for which, after long arguments no rosy solutions could be found.

(2.) Let me state a few facts relating to the suit which was decreed by the Munsiff's Court and has been brought up by the defendants before me. A Kuri or Chitty was started by one Kumaran, now no more, admittedly out of his own resources, in which the plaintiff was a subscriber, had paid his subscriptions till the 31st instalment but 'prized' the ticket for an amount of Rs. 999/- at the 32nd round on 20-5-65. So long as Kumaran lived his kuri also survived and on the former's death in 1965 (January), it is alleged by the plaintiff that the kuri was continued by his eldest son, the 2nd defendant, for some time. Towards the prize amount of Rs. 999/- only Rs. 425/- had been paid by the 2nd defendant in six instalments. Subscriptions for subsequent months had fallen due which the foreman of the kuri was entitled to deduct from the amount due to the plaintiff. The legal representatives of Kumaran are the defendants. The lower court decreed the suit against the joint family of Kumaran, after giving credit for various instalments which had fallen due since the "prizing". The defendants challenge the decree in this revision.

(3.) Before me it has been contended for the revision petitioners that the kuri was Kumaran's sole business and not that of the joint family, either to begin with or later by any act of adoption or blending, and that a kuri was a speculative business which could not have been started or continued on behalf of a Hindu undivided family. The respondent controverted these points and added that, apart from the business of Kumaran being one belonging to the joint family the members of the family were bound because they had enjoyed the benefits of the business, income from which had been utilised for the reconstruction of a family house. It was also pressed before me - and duly controverted by the other side - that the parties were Thiyyas of Ponnani and were governed by Hindu Law, including the theory of pious obligation and so the father's debts were recoverable from the sons. It follows from what I have said that we have to consider (1) whether Kumaran's joint family was a trading family, (2) whether the kuri business had been started or adopted by or blended with the other assets of the joint family and (3) whether the Thiyyas of Ponnani, like the defendants, were governed by the Hindu law doctrine of pious obligation. I shall proceed to deal with these points together. The last word on findings of fact belongs to the Trial Court as against the revisional Court, except where the judgment is not in accordance with law. Viewed that way, I am not inclined to disturb the learned Munsiff's holding that "the amount due to the plaintiff as per the auction kuri is Rs. 424/- and interest from 1-4-1967 at 5%". A decree for that amount will be meaningful for the plaintiff only if he can recover it from the assets of the joint family of which Kumaran was the head presumably because there are no sufficient separate assets left behind by him. Let us therefore consider the pros and cons of the substantial controversy in this case viz. the liability of the joint family or at least of the sons, to the extent of their shares in the joint family. Admittedly, the kuri was not started as a family business nor carried on with the aid of family funds although in the light of Ex.A4 and other evidence in the case it can be safely held that there was a joint family, with property, of which Kumaran was the manager till his death. Nor am I persuaded, by any materials on record, to take the view that conducting kuries is the kulachara of the defendants' family. So then, how could this kuri - or, rather, could it at all - become a joint family business, so as to make the liabilities arising therefrom, realisable out of the assets of the family Whether a new business commenced by the manager of a joint family is his separate business or not must depend upon the circumstances of each case. If the other coparceners are adult members, the business may have that character if consent, express or implied, of such coparceners had been given to the commencement of the business, but in this case there is no such positive evidence. Apparently it was an independent adventure of the father. There is no presumption under Hindu Law that a business standing in the name of any member of the joint family is a joint family business, even if that member is the manager, unless it could be shown that the business in the hands of the coparcener grew up with the assistance of the joint family property or funds or that the earnings of the business were so blended with the joint family estate as to imply a fusion of the two assets. (See the decision in AIR 1968 SC 1276 ). In the absence of evidence about family funds or property having been utilised, the endeavour of the plaintiff has been to show that the business had been blended with the joint family estate and had thus ceased to be separate. Proof thereof is derived from the fact that the income from the kuri, or rather the subscriptions given by the ticket holders had been freely used for the construction of the family house. Of course, the other members can adopt the business with the consent of the manager as a joint family business by enjoying the benefit of the business. The question in each case is not of any presumption, but of an inference to be drawn from the conduct of the manager and the other coparceners. In the present case, although the plaintiff went to the extent of contending that the kuri was started for the purpose of financing the reconstruction of the family house the evidence, at best, only shows that the kuri moneys where pumped in for putting up the building. It is but reasonable, therefore, to hold that the kuri was started by Kumaran on his own but that he utilised money which thereby came into his hands for helping the family reconstruct its house. The argument that the starting of the kuri was itself for a family necessity and so was binding on the family may involve dangerous implications as can hardly hold good in a prudent scheme of things, because while a debt may be contracted or alienation effected for a binding purpose a manager cannot start a business whereby he comes into possession of other people's moneys and diverts them into an unproductive channel thereby landing the family in a much larger financial liability later; any such chitty with an unbusiness like plan of action will be condemned to collapse in its infancy; for, if subscriptions from the members are not ploughed back for regularly paying the prize money but are siphoned off for user in an non self generating venture like a family house, however pressing the need for it, the central idea of a revolving fund which keeps a kuri going will fail. Legally speaking, the foreman of a chitty is a fiduciary of others' funds which he cannot divert for purposes extraneous and injurious to the scheme, albeit urgent from his family point of view. For helping a person or his family out of financial straits by collective aid we have another indigenous mutual aid institution called Kurikalyanam or Changathi Kuri by which a person sends out invitations to his friends and well wishers to meet at his place for a quasi cocktail party and there to contribute some sums by way of help to lift him out of his distress and he. in turn, often repays later by similar contributions when those others conduct such Kurikalyanams. Such a philanthropic institution cannot be confused with a regular kuri or chitti which is a commercial adventure of a banking nature. The law condemns or connives at the chitty as an institution of imprudence if it sanctions the theory that a manager of a joint family may start a kuri as a device to come by the funds of other people and, instead of using it as a revolving fund for the smooth running of the business, divert such adventitious cash for discharge of debts or other needs unconnected with the kuri and in violation of the fiduciary obligations involved in the scheme. That cannot be. Viewed also from the interests of the joint family, a kuri, being a speculative business, h beyond the powers of the kartha. By 'speculative' in this context, is meant involving such financial risks as to make it unsafe to stake the interests of an essentially conservative, non commercial quasi corporate body like a Hindu undivided family. Judicial pronouncements also reinforce these propositions.