1 SA-752-10.odt IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION SECOND APPEAL NO.752 OF 2010 WITH CIVIL APPLICATION NO.1029 OF 2011 Arinjay Hirachand Shah and anr. ..Appellants/ Applicants Vs Hirachand Mahikchand Shah and anr. ..Respondents -- Mr.N.M.Sakhardande i/b.Mr.S.R.Page, for appellants. Mr.Atul Damle i/b.Mr.Kunal Damle, for respondent no.2. Mr.R.A.Dada, Senior Counsel with Mr.Girish Shadge i/b.Mr.Hemant Ghadigaonkar, for respondent no.3. -- CORAM : R.G.KETKAR, J. DATE : 10 th OCTOBER, 2011 2 SA-752-10.odt P.C. The original plaintiffs have preferred this Second Appeal challenging the judgment and decree dated 14 th July, 2009 passed by the learned 2 nd Joint Civil Judge, Senior Division, Pune in Regular Civil Suit No.117 of 2008 as also the judgment and decree dated 31 st August, 2010 passed by the learned District Judge-3, Pune in Civil Appeal No.508 of 2009. By these judgments, the Courts below dismissed the suit instituted by the appellants for declaration that the development agreement as also power of attorney dated 19 th December, 2007 executed by original defendant no.1 – Hirachand, since deceased and defendant no.2 Smita Shah in favour of defendant no.3 are illegal and void and for perpetual injunction restraining these defendants from carrying out any development activity on the land bearing survey no.34/1/4 admeasuring 75 square metres and land admeasuring 3000 sq. metres out of survey no. 3 SA-752-10.odt 39/2/5 situate at Vadgaon Budruk, Taluka Haveli, District Pune (for short “the suit lands”). The parties shall hereinafter be referred as per their status in the trial Court. 2] It is the case of the plaintiffs that one Manikchand Shah was the owner of land bearing survey nos.35/2, 38/2, 39/1A, 39/2 and 40/2 situate at Vadgaon Budruk. The original defendant no.1 late Hirachand was son of late Manikchand. Late Hirachand has four sons namely Shrimandar (defendant no.4), Jugmandar, since deceased, Arinjay (plaintiff no.1) and Niranjan, since deceased and daughter Smita (defendant no.2). 3] It is the case of the plaintiffs that in the year 1975 Manikchand got his name deleted from the revenue records of these lands and got mutated in the name of his son Hirachand (defendant no.1) and four 4 SA-752-10.odt grandsons namely, Shrimandar (defendant no.4), late Jugmandar, Arinjay (plaintiff no.1) and late Niranjan. Pursuant thereto, mutation entry no.1561 dated 26 th July, 1975 (exhibit 75) was made. Thereafter, on an application made by late Hirachand in the year 1979, the Tahsildar effected partition by metes and bounds between Hirachand and his four sons. Hirachand and his four sons were put in possession of their respective shares. Mutation entry 1689 (exhibit 74) to that effect was made. The suit lands were allotted to the share of late Hirachand. On 29 th January, 1981, the document styled as Khulasapatra at exhibit 97 was executed whereunder, restrictions were imposed on Hirachand and his four sons. It provided that late Hirachand should form a religious trust and that property allotted to his share i.e.suit lands should be given to the said religious trust. In so far as sons of late Hirachand are concerned, it provided that they should enjoy the lands allotted to their respective share but, were not 5 SA-752-10.odt authorized to transfer or alienate the said lands. In short, only life interest was given them. Subsequently, another Khulasapatra was executed on 10 th January, 1982 at exhibit 98 whereunder, the restrictions imposed on the sons of Hirachand were lifted and in so far as late Hirachand is concerned, the restrictions imposed on him were maintained. 4] It is the further case of the plaintiffs that as per desire of late Manikchand, late Hirachand during his life was entitled to enjoy the lands allotted to his share as per his wishes. Thereafter, a religious trust was to be created and the suit lands were to be handed over to the said trust. Thus, late Hirachand was given only life interest in the suit lands and was not authorized to alienate the suit lands. However, late Hirachand in collusion with his daughter Smita Shah (defendant no.2) executed a development agreement as also 6 SA-752-10.odt executed a power of attorney in favour of the defendant no.3 on 19 th December, 2007. It is in these circumstances the suit was instituted for the aforesaid reliefs. 5] The suit was resisted by defendant no.2 Smita Shah and defendant no.3 by filing written statement exhibit 25. It was denied that the Khulasapatra dated 10th January, 1982 was executed incorporating desire of late Manikchand. It was contended that the Khulasapatra was never acted upon. At any rate, the said Khulasapatra is a unregistered document and consequently, cannot be read in evidence. It was further asserted that as per the partition of year 1979, late Hirachand acquired the suit lands as an absolute owner. Between 1980 and October, 2007 he had leased out the portion of the suit lands to several persons including the plaintiff no.1 under various registered lease deeds. The lessees, in turn, carried 7 SA-752-10.odt out constructions of permanent nature on their respective properties. On 3 rd October, 1995, late Hirachand had leased out land admeasuring 805 sq. metres to the plaintiff no.1 for 98 years where the plaintiff no.1 has constructed a hotel. The plaintiffs or the other defendants never raised any objection to the transactions entered into by late Hirachand in respect of the suit lands. Thus, the conduct of the parties to the Khulasapatra clearly militated against the case of the plaintiffs that the said Khulasapatra was acted upon. On the contrary, the conduct of the parties to Khulasapatra indicated that it was not acted upon. In view of this, it was submitted that late Hirachand and defendant no.2 Smita had right to execute development agreement and power of attorney in favour of defendant no.3. 6] The parties led oral as well as documentary evidence on 8 SA-752-10.odt record. The Courts below after appreciating the material on record came to the conclusion that the plaintiffs failed to establish the desire of late Manikchand to form a religious trust to which late Hirachand should hand over the possession of suit lands; the Courts below also held that the plaintiffs failed to establish that late Hirachand had only life interest in the suit lands; the Khulasapatra dated 10 th January, 1982 was not acted upon. Consistent with these findings the Courts below dismissed the suit instituted by the plaintiffs. It is against these judgments, the plaintiffs have preferred this Second Appeal. 7] I have heard Mr.Nikhil Sakhardande, learned counsel for the plaintiffs and Mr.Rafique Dada, learned Senior Counsel for the respondents, at length. 8] Mr.Sakhardande contended that the Courts below committed 9 SA-752-10.odt serious error in holding that the Khulasapatra dated 10 th January, 1982 was not acted upon. He submitted that the plaintiffs evidence on that aspect was not challenged. If that be so, the Courts below could not have held that the Khulasapatra was not acted upon. He invited my attention to paragraphs 8 and 9 of the affidavit of evidence of plaintiff no.1 - Arinjay as also Khulasapatra dated 10 th January, 1982 in support of this submission. He further submitted that no issue was framed by the trial Court on this aspect. Apart from this, he submitted that the document cannot be acted upon in part and acted upon in the remaining part. The document has to be either acted upon in its entirety or not to be entirely acted upon. In support of his submission, he relied upon the judgment of this Court in the case of Hindoostan Spg. And WVG Mills Ltd. Mumbai Vs. H.C.M.S.K.K.S.S., 2007(5)Mh.L.J. 801 and in particular, paragraph 84 thereof. 10 SA-752-10.odt [] He further submitted that the Courts below committed serious error in holding that late Hirachand was absolute owner of the suit lands. The Courts below held that since late Hirachand had disposed of the part of the suit land either on ownership or by way of lease, he cannot be said to have life interest or limited owner. In support of the submission that even a person having limited interest or life interest, is entitled to lease the land during his or her life time, he relied upon the judgment of the Apex Court in the case of Smt.Rukhamanbai Vs. Shivram and ors, (1981) 4 SCC 262. 9] On the other hand, Mr.Dada submitted that the plaintiffs have not established the desire of late Manikchand of creating religious trust to which suit lands of Hirachand were to be handed over. At any rate, the document styled as Khulapatra dated 10 th January, 1982 has no legal efficacy having regard to Section 11 of the Transfer of 11 SA-752-10.odt Properties Act, 1882. He further submitted that the oral statement expressing desire of late Manikchand has no legal effect in view of Section 57 of the Indian Succession Act, 1925. He submitted that there cannot be any oral Will of late Manikchand. He further submitted that late Hirachand became absolute owner of the suit lands and had every right to deal with the suit lands. Late Hirachand executed various lease deeds which were duly registered including one in favour of plaintiff no.1. It therefore clearly establishes that the parties have never acted upon the Khulasapatra dated 10 th January, 1982. [] I have considered the rival submissions made by the learned Counsel for the parties. In order to appreciate the arguments advanced by the parties, it is necessary to find out first whether the plaintiffs have established the desire of late Manikchand that late 12 SA-752-10.odt Hirachand should form a religious trust and the properties allotted to his share i.e. suit lands should be given to the said religious trust. It is relevant to note that in the year 1975, Manikchand got his name deleted from the revenue records of various lands including the suit lands and got them mutated in the name of Hirachand and four grandsons. At that time, he did not express any desire about formation of trust as also creation of limited interest of late Hirachand in any of the properties. Subsequently, in the year 1979, late Hirachand and his four sons made a joint application to the Tahsildar for effecting partition. That time also, the desire of late Manikchand was not incorporated. The Courts below, on the appreciation of evidence on record, concurrently held that the plaintiffs did not establish the desire of late Manikchand about Hirachand forming a religious trust and giving the land of his share to the said religious trust. This is a finding of fact. The Courts below also considered that 13 SA-752-10.odt having regard to the provisions of Section 57 of the Indian Succession Act, 1925 there cannot be any oral Will of late Manikchand. I am, therefore, clearly of the opinion that the plaintiffs failed to establish the desire of late Manikchand. [] The Courts below further concurrently held that the plaintiffs failed to establish that late Hirachand was a limited owner. Once the suit lands were allotted to the share of Hirachand, it has to be held that he became absolute owner of the suit lands having regard to Section 11 of the Transfer of Properties Act, 1882. [] The next question is whether the document styled as Khulasapatra dated 10 th January, 1982 was acted upon. Mr.Sakhardande submitted that the said document was acted upon and at any rate, it cannot be said that the said document was acted 14 SA-752-10.odt upon in part and was not acted upon in the remaining part. The document has to be acted upon in its entirety and not otherwise. [] I do not find any substance in this submission as well. The Courts below have considered that even the Khulasapatra dated 29 th January, 1981 (Exhibit 97) was not acted upon. As per the Khulasapatra dated 29 th January, 1981, there were restrictions on the sons of Hirachand. Recitals of that Khulasapatra indicate that late Hirachand was to form a religious trust and the properties allotted to his share were to be given to the said religious trust. At that time, restrictions were imposed on the sons of Hirachand to the effect that they should enjoy the lands allotted to their respective share and they are not entitled to transfer or alienate the lands which fell to their share and only life interest was given to them in the said lands. In the cross-examination of plaintiff no.1 – Arinjay, conduct of his brother 15 SA-752-10.odt late Jugmandar while dealing with the lands allotted to the share of late Hirachand was brought on record. Late Jugmandar, father of plaintiff no.2 transferred 5 acres of land of his share in the name of Surekha (his wife) – Defendant no.1A in the year 1979 i.e.prior to execution of Khulasapatra dated 29 th January, 1981 exhibit 97. Thus, even prior to execution of Khulasapatra on 29 th January, 1981, he had transferred 5 acres land in favour of his wife Surekha. Despite that, he signed the said Khulasapatra knowing well the restrictions/conditions incorporated therein. Subsequently, defendant no.1A Surekha transferred her land to one Shri.Kudale by executing exchange deed at exhibits 99 and 100. Sons of late Hirachand including Arinjay, plaintiff no.1 and late Jugmandar, father of plaintiff no.2 were aware of this transaction. However, they did not object to exchange deeds at exhibits 99 and 100. The Courts below, on appreciating the evidence, recorded that plaintiff no.1 was of 16 SA-752-10.odt understandable age when Manikchand got his name deleted from the revenue record and entered the names of late Hirachand and his four sons. In the cross-examination, he admitted that he does not know when and where late Manikchand expressed his desire about creation of religious trust and late Hirachand giving lands to the said trust. [] In so far as Khulasapatra dated 10 th January, 1982 is concerned, after appreciating the evidence on record, the Courts below found that out of 5 acres land that fell to the share of late Hirachand, presently he is in possession of only one and half acres. According to the plaintiffs, late Hirachand leased out an area about 7000-8000 sq.ft. of land for a period of 98 years to plaintiff no.1. In that land, he has made permanent construction and agreed to pay lease of Rs.800/- per month to late Hirachand. In the year 1985, 17 SA-752-10.odt plaintiff no.1 started business of thresher on that land by constructing a shed. In the year 1991-1992, he made construction of basement of 3000 sq. ft. Some part of the building was leased out to a show room of Hero Honda Company. Some portion of the ground floor was given to Bank of Maharashtra and in the rented premises he started Bramha Veg Hotel and Resorts Private Limited. Thus, even the Khulasapatra dated 10 th January, 1982 exhibit 98 was not acted upon. The findings reached by the Courts below are after appreciating evidence on record. I do not find that the courts below committed any error in reaching the said conclusion. [] In so far as reliance placed by Mr.Sakhardande on the judgment of Rukhamanbai (supra) is concerned, in that case, on behalf of the appellant it was contended that the appellant being a limited owner under the deed of settlement dated 22 nd May, 1930, she 18 SA-752-10.odt was not entitled to lease the land and therefore, respondent could not be said to be lawfully cultivating the land. The respondent could not become deemed tenant under Section 4 of the Bombay Tenancy & Agriculture Lands Act, 1998 and consequently, could not have become deemed purchaser on tillers day. [] The substantial question posed before the Apex Court was whether a limited owner of agricultural land governed by the Tenancy Act during her lifetime was entitled to lease the land and if he or she did lease the land whether the tenant inducted by the holder of life estate could be said to be lawfully cultivating the land so as to acquire the status of a deemed tenant under Section 4 and as corollary would become a deemed purchaser on the tillers’ day. In paragraph 16 after considering the deed of settlement, the Apex Court recorded that the appellant was given a life estate. She was 19 SA-752-10.odt the owner of land during lifetime with limitation that she could not Will, gift or sell the property or encumber the same. In view of these four limitations, she was undoubtedly a limited owner. But this limited owner holding the life estate was given the right to administer the estate after she attained mejority and administration of the estate would normally include leasing of the property except where a specific condition is prescribed precluding the administrator from leasing the property. The Apex Court found that there was no such limiting or restrictive condition prohibiting the appellant in the course of her management from leasing the land. In paragraph 21 of the Judgment, the Apex Court held that it is equally well recognised that a limited owner or a life estate holder in agricultural land, unless a clear intention to the contrary is expressed, would be entitled to lease the land during his or her lifetime. Reading the deed of settlement as a whole, the Apex Court did not find any such contrary intention 20 SA-752-10.odt and, therefore, negatived the contentions raised on behalf of the appellant. [] Relying upon this Authority, Mr.Sakhardande submitted that late Hirachand had life interest and even if he had entered into any transaction in relation to the suit lands, it cannot be said that he was absolute owner. I do not find any merit in this submission. Having regard to Section 11 of the Transfer of Properties Act, 1882 and the very fact that late Hirachand had executed various lease deeds which were duly registered, the plaintiffs did not raise any objection, the Courts below, rightly concluded that late Hirachand was the absolute owner. As indicated earlier, the question in the first place is whether late Manikchand had expressed any desire of late Hirachand creating a religious trust and allotting the lands that fell to his share to the said trust and secondly, whether the Khulasapatra dated 29 th January, 21 SA-752-10.odt 1981 exhibit 97 and subsequent Khulasapatra dated 10 th January, 1982 exhibit 98 were acted upon. On appreciating the evidence on record, the Courts below came to the conclusion that both these documents were not acted upon upon by the parties to the document. I also do not find that the Courts below committed any error in passing the impugned judgment. No substantial question of law arises. Second Appeal is, accordingly, dismissed. In view of the dismissal of Second Appeal, Civil Application No.1029 of 2011 does not survive and the same stands dismissed. [R.G.KETKAR, J.] 22 SA-752-10.odt IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION SECOND APPEAL NO.14 OF 2011 WITH CIVIL APPLICATION NO.1030 OF 2011 Arinjay Hirachand Shah and anr. ..Appellants/ Applicants Vs Shrimandar Hirachand Shah and ors. ..Respondents -- Mr.N.M.Sakhardande i/b.Mr.S.R.Page, for appellants (in both appeals). Mr.Korde i/b.Mr.Atul Damle, for respondent no.6. -- CORAM : R.G.KETKAR, J. DATE : 10 th OCTOBER, 2011 P.C.: The learned counsel for the parties fairly state that the decision in Second Appeal No.752 of 2011 will govern the decision in this appeal. 23 SA-752-10.odt By my separate order dated 10 th October, 2011 in Second Appeal No.752 of 2011, I have already held that late Hirachand was the absolute owner and not a person having limited interest in the suit lands. Therefore, present Appeal fails and the same is dismissed accordingly. [R.G.KETKAR, J.]