RAI BAHADUR KHARAG NARAIN Vs. JANKI RAI

JUDGEMENT

(1.) Gobardhan Lal and his brother Girwar were members of a joint family, with their father Banarsi Lal, and their two uncles Brij Lal and Dularchand. Gobardhan Lal at an early stage began to quarrel with his family and to do business on his own account with Janki Rai. On February 9,1918, he executed a bond whereby he purported to mortgage a share of 1-6th in the property specified, part of which was ancestral property of the family, while part had been bequeathed by Nandu Lal, the maternal grandfather of Banarsi Lal, to his three grandsons Banarsi Lal. Dularchand and Brij Lal. In the mortgage bond there was a recital to the effect that Gobardhan Lal had demanded partition of the family property; but the members of the family were unwilling to make it: so this mortgage was executed in part for payment of antecedent debt and in part to raise money for the purpose of instituting a suit for partition. The money was not utilised for the institution of the partition suit, but it was utilised for a separate business carried on by Gobardhan Lal. After 1918 the three brothers made further acquisitions of joint family property. They did not mention the name of Gobardhan Lal in any deed; but as there is no mention of any sons, this fact would not necessarily be of any significance. If Gobardhan Lal had actually separated in 1918, he would not prima facie have been entitled, when partition was ultimately made, to a share in this property, though he might possibly have been entitled if, while he still remained a tenant-in-common, the property was acquired from the joint fund. On May 21, 1927, after the death of Banarsi Lal, Gobardhan Lal s two uncles with his brother executed a mortgage, wherein they recited that Gobardhan Lal had cut himself off from his family in the lifetime of his father and had ceased to have any right to the family property. The mortgagee, doubtful on this point, obtained another mortgage bond in the following year in the execution of which Gobardhan Lal took part, wherein it was recited that the family was joint. On September 25, 1928, a formal partition of the property was made, wherein a third share went to Gobardhan Lal and his brother Girwar who immediately partitioned this share between themselves. On December 7, 1929, Gobardhan Lal mortgaged part of the property which had fallen to him on partition to Rai Bahadur Kharag Narain. On January 12, 1930, he sold a portion of that property to Musammat Lal Pari who redeemed to that extent the mortgage of Kharag Narain.

(2.) On May 11, 1931, Janki Rai instituted a suit on the basis of his mortgage of 1918, claiming to proceed against the property which had fallen to Gobardhan Lal on partition. The suit was instituted almost twelve years after the date of payment fixed by the mortgage bond, but within time. It was contested on various grounds by the sons of Gobardhan Lal, and also by the mortgagee of December 7, 1929, and the purchaser of January 12, 1930, who asserted that the bond was a colourable transaction not executed for consideration; that there was no family necessity for the bond; and that since the mortgagor was a member of the joint family when the mortgage was made, nothing was conveyed by the transaction. The Subordinate Judge found that the mortgage was for consideration and that so far as the sons of Gobardhan Lal were concerned, it was binding on them because it was executed on account of antecedent debt and for family necessity. He found that the mortgagor was not separate from his father and uncles at the time when the deed was executed, but that he represented to the mortgagee that he was separate. The learned Subordinate Judge accordingly applied the provisions of Section 43 of the Transfer of Property Act holding that since the mortgagor by actual separation had placed himself in a position to carry out the alienation which in 1918 he had represented himself to be able to do, the mortgage deed must be enforced. The mortgagee of 1929 and the purchaser of 1930 were transferees for value; but the learned Subordinate Judge found that they had failed to prove that they had no notice of the option conferred by the mortgage of 1918, and it could, therefore be enforced against them. Immediately after the institution of the present suit the mortgagee of 1918 instituted a suit on his own mortgage bond which was apparently disposed of more promptly than the suit with which we are here concerned, so that he was able to obtain a decree and purchase the property in dispute while this suit was pending. The mortgagee and the transferee of January 12, 1930, have appealed from the decision of the Subordinate Judge.

(3.) Mr.Khurshed Husnain on behalf of the appellants attacks in the first place the finding of fact of the learned Subordinate Judge5 that at the time of the mortgage, the mortgagor represented to the mortgagee that he had made a definite announcement of his intention to separate such as would amount to separation in the eye of Iawi Mr. B.C. De supporting the decree on grounds decided against him in the triple Court argues that the learned Subordinate Judge ought to have found that there was actual separation in 1918 Whatever representation might have been made, Mr. Khurshed Husnain argues that the mortgage should not be regarded as taking effect upon the share which ultimately fell to Gobardhan Lal on partition, because the mortgagor did not purport to transfer a share of an undivided estate but merely a share in specific property. He argues also that the mortgage of an undivided share is void ab initio and no equity can be created by it, such as would call for the application of the provisions of Section 43 of the Transfer of Property Actor of any of cheer equitable Rule V Finally he argues that the appellants are transferees for value without notice of the option arid that they are, therefore, protected from the operation of Section 43.