U P OIL MILLS Vs. JAMNA PRASAD

JUDGEMENT

(1.) The case was partly heard and decided on 31 May, 1932. The result of that decision was that the application of the official liquidator was dismissed as against all the opposite parties, except as against Ram Lakhan, son of Jag Mohan Ram. We directed by our order that Shiarm Lal, witness, should be re-examined, and he has been re-examined. Now we proceed to decide the remaining issues. Issue 1. The evidence of; Shiam Lal now clearly establishes that Jagmohan Ram signed the memorandum of association as a promoter and made himself liable for 151 shares of the value of Rs. 100 each. Shiam Lal swore that he attested the memorandum of association in the presence of the executant, Jagmohan Ram. It was argued that this evidence was not enough and that Shiam Lal ought to have said specifically that he was present when Jagmohan Ram made his signature and that Jagmohan Ram was present when Shiam Lal signed the document as a witness. In our opinion the statement made by the witness makes this clear, and if this was not clear, questions should have been put in cross-examination to find out if J Shaim Lal meant to say something else. This not having been done, we hold that Shiam Lal did attest according to law the signature of Jagmohan Ram and Jagmohan Ram's liability arose. Issue No. 2 no longer arises, as on the question of fact involved in issue No. 1, we have found that Jagmohan Ram did actually sign the memorandum of association and his signature was attested in accordance with law. Issue No. 3 has already been decided so far as the question of benefit to the family is concerned. We held that membres of the joint family other than the son were not liable. We have now to determine the liability of the son. This will be considered in connection with issue No. 4. Issue No. 4. According to Section 160, Companies Act, Ram Lakhan is liable as a legal representative of Jagmohan Ram as a contributory "in due course of administration". This means that so far as Jagmohan Ram may have died possessed of separate property, that property in the hands of his son, Ram Lakhan, is liable as indicated in Section 160, Companies Act. It is however argued that not only the separate or self-acquired property of Jagmohan Ram is liable, but also the share of Ram Lakhan in the family property is liable to pay Jagmohan Ram's debt because of the pious duty of Ram Lakhan to pay such debt.

(2.) There can be no doubt that the debt in question is not tainted with immorality. Now we have to find out how far the share of Ram Lakhan in the joint family property is liable to pay Jagmohan Ram's debt. The relevant proposition of Hindu Law, when fully stated, would stand as follows: A son is liable to pay his father's debt, out of the family property consisting of his own share and the share of the father the property which was in the father's hand in the life-time of the father. It is not a complete statement of the law to say, that a Hindu son is bound to pay his father's debt because of a pious obligation to that effect. If that were the sole proposition of law, the son would be liable to pay out of his personal earnings, which however is not the law. The doctrine of pious obligation was invented to settle a conflict between two positions that were bound to arise in a family consisting of a father and his sons. The first position was that, in ancestral property, a son by his mere birth, got a share which was equal to the share of the father. In accordance with this proposition of law, the property in the hands of the father is not the absolute property of the father. That being so, he cannot utilise that property for the payment of his debts. The next position is this. A father is the head of the family. Ostensibly, he owns the entire property which he manages, although, legally, he and his sons have equal shares in the property. On the strength of this property, and on the credit of it, the father deals with the world at large and incurs debts. If the father be unable to raise any money on the credit of the joint family property, the result would probably be that in many cases maintenance of the sons and the family would become impossible; for there would be no credit in the market and nobody would lend money or provisions to the father because they would have no or a poor remedy against the father. To adjust: between these conflicting positions, a doctrine was invented that it is the pious duty of the son to pay the father's debt out of the entire family property, including the shares of the sons, provided the debt is not tainted with immorality.

(3.) The doctrine of pious obligation to pay the father's debt would be available only when there is a family consisting of father and sons. For, where the family consists not only of the father and the sons, but of brothers of the father and nephews of the father, the position becomes entirely different. Then it is no longer a case of a father at the head of his family, and incurring debts on the credit of family property. It is then a case of a debt incurred by one of the members of a Hindu family. If the person who has incurred the debt be the manager of the family, he can bind the family only if he has incurred the debt for the benefit of the family. If he be not the manager, he cannot bind the family in any circumstances. If there is no benefit to the family, the debt can be realised, is the case of a simple money decree being passed on it, by attachment of the share of the debtor in his life time. If an attachment be effected, that attachment would virtually take the property attached out of the hands of the joint family and put it into the custody of the Court. In that case the debtor's share, so attached may be sold. But the share of debtor's son would not be liable to be sold. It is the property, which a father himself may sell to pay his own debt, that can be sold through the intervention of the Court. Where the debtor is not himself the1 head of a family consisting of himself and his son, he cannot sell any portion of the family property, even his own share, to pay his own debt. See Balgobind V/s. Narain Lal (1893) 15 All 339. If there be no attachment in the life time of the debtor, his interest would pass by survivorship to the remaining members of the family and the creditor would be without any remedy whatsoever. See Binda Prasad V/s. Raj Ballabh .