* THE HONOURABLE SRI JUSTICE VILAS V. AFZULPURKAR + SECOND APPEAL No.212 of 1999 % Dated 22.10.2010 # B. Nadamuni Chetty, S/o.Nagaiah, R/o. 19-3-3C, Srinivasapura, Tirupati. …APPELLANT VERSUS $ P. Krishna Reddy and six others. …RESPONDENTS ! Counsel for the Appellant: MR. DORAI RAJ ^ Counsel for the Respondents: MR. J. UGRANARASIMHA <GIST: >HEAD NOTE: ? Cases referred 1. AIR 1929 PC 1 2. AIR 1968 SC 1276 3. (2004) 11 SCC 320 4. 2009 (3) ALD 655 5. AIR 1954 SC 379 6. AIR 1969 SC 1076 IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD FRIDAY, THE TWENTY SECOND DAY OF OCTOBER TWO THOUSAND AND TEN PRESENT THE HON'BLE SRI JUSTICE VILAS V. AFZULPURKAR SECOND APPEAL No.212 OF 1999 BETWEEN B. Nadamuni Chetty. …APPELLANT AND P. Krishna Reddy and others. …RESPONDENTS Counsel for the Appellant: MR. DORAI RAJ Counsel for the Respondents: MR. J. UGRANARASIMHA The Court made the following: - JUDGMENT: This is an appeal by the third defendant questioning the judgment and decree of the lower appellate Court in A.S.No.8 of 1992 dated 28.01.1998 confirming the judgment of the trial Court in O.S.No.6 of 1987 dated 04.11.1991. 2. The first respondent herein is the plaintiff, who filed O.S.No.6 of 1987 for partition of the suit schedule properties against the first defendant – his elder brother, second defendant – first defendant’s wife, third defendant – appellant herein alinee in respect of item 1 of plaint schedule and defendants 4 to 13, who are other alienees of the plaint schedule properties just like the third defendant. The defendant No.14 is one of the brothers, who joined first respondent/plaintiff in filing the suit but was later transposed as defendant No.14. For the sake of convenience, the parties herein are referred to as they are arrayed in the suit. 3. The appellant – third defendant had purchased item 1 of plaint schedule properties and in view of the fact that the dispute relating to other plaint schedule items was already settled during the pendency of the suit, the dispute now survives only to the extent of item 1 of plaint schedule. 4. The plaintiff/first respondent herein claimed in the suit that he, the first defendant and defendant No.14 are all brothers allegedly constitute Hindu undivided family and the first defendant being the eldest, he is the manager of the said Hindu Undivided Family. It is alleged that all the three brothers jointly carried on business and earned properties, which are shown in the plaint schedule and though the said items stand in the name of the first defendant, he being the eldest of the brothers and the Manager, other brothers including the plaintiff have a right to seek partition of the plaint schedule properties. It is alleged that the first defendant is acting adverse to the plaintiff and defendant No.14 and alienated the plaint schedule properties to the third defendant and other defendants 4 to 13 and alleging that the said alienations are collusive, nominal and not binding on the plaintiff, the present suit for partition and possession of separate of 1/3rd was filed. 5. The first defendant filed a detailed written statement admitting the relationship but seriously disputed the remaining allegations in the plaint. He disputed the right, title and interest of the plaintiff and defendant No.14 and claimed that there is neither any joint family nor any joint family property nor the first defendant has acted as Manager. He alleged that the plaint schedule properties are his own and self-acquired properties and exercising individual rights, he has alienated the properties. He also asserted that since he purchased item 1 of plaint schedule under sale deed dated 21.06.1971 for Rs.2,000/- from vendor – S. Ramalinga Reddy, he has been in exclusive enjoyment and possession and that all the title deeds are in his name and the municipal taxes and assessment is also in his name. He also asserts that the Tirupati Municipality has proceeded against him for making unauthorized construction and he alone is paying the taxes to the municipality and exercising absolute rights. He, further, claimed that on 10.11.1976 he entered into agreement of sale with the third defendant for Rs.56,000/- and on the date of sale he was paid Rs.11,000/- and the balance sale consideration was agreed to be paid on or before 10.02.1987. He claimed that the third defendant paid various amounts and was delivered possession on 10.12.1986 and later executed registered sale deed dated 15.01.1987 in his favour after receiving balance consideration amount. He also asserted that items 2 and 3 of plaint schedule were also sold to third parties and at no point of time the plaintiff and defendant No.14 raised any objection. He, therefore, seriously disputed the claim of the plaintiff as stated in the plaint and claimed that he had always been doing Soda business independently and it is alleged that the plaintiff and defendant No.14 have been residing separately and carrying on separate business and have earned properties but have conveniently not included those properties in the plaint schedule. The said written statement of first defendant is adopted by second defendant – his wife. 6. The third defendant also filed a written statement on the lines of the first defendant’s written statement by asserting that plaintiffs are strangers to the property and they have no cause of action and that he is in exclusive possession and enjoyment of item 1 of plaint schedule. He also confirmed the agreement of sale preceeded the sale deed and the payment of various amounts from time to time including balance consideration paid at the time of execution and registration of sale deed and assets that entire sale transaction was with the knowledge of the plaintiff and that they never objected and it is also alleged that, in fact, the plaintiff wanted to purchase item 1 of plaint schedule but the first defendant did not accept his offer, which has resulted in the present litigation. He also alleged that subsequent to the suit notice the plaintiffs agreed for mediation and in that mediation expressed that plaintiffs have no objection for registration and as such, the third defendant is a bonafide purchaser. 7. The other written statements of other defendants are not relevant now as the litigation with respect to other items of plaint schedule are already settled pending the suit. 8. The trial Court framed the issues as follows: 1. Whether the suit properties are joint family properties? 2. Whether the alienation in favour of D.3 to D.13 are not binding on plaintiffs? 3. Whether the plaintiffs are entitled for partition and if so in what properties and to what share? 4. To what relief? 9. The plaintiff examined himself as P.W.1 supported by other witnesses P.Ws.2 to 4 and Exs.A1 to A20 were marked. However, the first and second defendants remained ex parte after filing the written statement and the third defendant examined himself as D.W.1 apart from D.Ws.2 to 4 and marked Exs.B1 to B27. 10. The trial Court found on issue No.1 that the plaintiff, first defendant and defendant No.14 were living jointly and that they purchased the plaint schedule properties with joint family funds and the first defendant has failed to establish that suit schedule properties are his self- acquired properties and primarily, on the ground, that defendants 1 and 2 have not examined themselves adverse inference is drawn against them and issue No.1 is answered in favour of plaintiff. D.W.1 is also held to be not a bonafide purchaser for value and consequently, a decree for partition was passed. 11. On appeal, the lower appellate Court framed points as to whether there is sufficient evidence on record to prove that the plaint schedule properties are joint family properties and as to whether the third defendant is a bonafide purchaser for value. The lower appellate Court also concurred with the trial Court and came to hold on point No.1 that the plaintiff has established that the plaint schedule properties are joint family properties and that the plaintiff has 1/3rd share therein. Point No.2 was also answered against the third defendant holding that he is no a bonafide purchaser for value on the ground that Ex.B16 sale deed obtained by him dated 15.01.1987 is after receiving the suit notice of the plaintiff – Ex.A7 dated 20.12.1986 and simultaneously, the same was replied by the third defendant under Ex.A9 dated 15.01.1987. The appeal was accordingly dismissed against which this second appeal is filed. 12. Mr. Dorai Raj, learned counsel for the appellant has contended that both the Courts below have erroneously reached the conclusions as if there is any existence of joint family among the plaintiff, first defendant and defendant No.14 and have committed further error in thinking that there was any joint family property including the plaint schedule properties. He has pointed out from the pleadings and evidence of plaintiff himself that even according to the plaintiff, he as well as the first defendant and defendant No.14 – all of them were carrying on profession of coolies and had no ancestral properties. While working as coolies with P.W.3, the first defendant, who is the eldest of the brothers has acquired the Soda machine from P.W.3 on lease and after working the lease for few years started his own business and earned the plaint schedule properties. Admittedly, all the properties stand in the name of the first defendant. Learned counsel, therefore, submits that in the absence of any ancestral property and in the absence of any evidence of any nucleus of joint family among the three brothers, much less the joint family property, the findings of both the Courts below on issue No.1 are vitiated. 13. Learned counsel also pointed out that the sale of item 1 to the third defendant i.e. appellant is preceded by agreement of sale Ex.B9 dated 10.11.1986 and after the third defendant paid various amounts of sale consideration to the first defendant, ultimately sale deed was executed vide Ex.B16 dated 15.01.1987. The present suit has been filed on 19.01.1987 when the first defendant had already alienated item 1 to the third defendant and other items to defendants 4 to 13. Learned counsel, therefore, submits based upon the following decisions that in the absence of any evidence of ancestral properties or nucleus neither joint family property nor joint family can be presumed: K.L.S.V.E. ANNAMALAI CHETTY v. K.L.S.V.E. SUBRAMANIAN CHETTY[1]; G. NARAYAN RAJU v. G. CHAMARAJU[2]; P.S. SAIRAM v. P.S. RAMA RAO[3] and a decision of this Court in MARGADARSHINI EDUCATIONAL SOCIETY v. P. SUBHASHAN[4]. 14. Learned counsel for the respondents, on the other hand, contended that both the Courts below had reached the conclusions on issue No.1, which are based on appreciation of evidence and as such, are not open for interference in this appeal. He also points out that only the person, who could have refuted the plaint allegations, was the first defendant, who has not chosen to examine himself and as such, adverse inference has rightly been drawn against him. He also points out that the suit schedule properties are earned by joint labour of the plaintiff, first defendant and defendant No.14 and the plaintiff cannot be deprived his 1/3rd share in the plaint schedule properties. He also points out that the lower appellate Court has taken into consideration the additional aspect, which is evidenced by Ex.A10, the complaint filed by the third defendant himself before the II Additional Judicial Magistrate of First Class, Tirupati against the first defendant wherein the third defendant has stated that the first defendant has mislead the third defendant into purchasing the property by showing a registered partition deed signed by all brothers. Learned counsel, therefore, submits that this by itself proves that the plaintiff’s contentions are justified and even according to the third defendant, item 1 of plaint schedule is a joint family property. 15. This appeal was admitted on the substantial questions of law under ground No.8 (a) to (d) by order dated 13.08.1999. The said questions are extracted hereunder: a) Whether both the lower Courts have committed serious error of law in not considering Exs.B-9 to B-11 in proper perspective which lead to miscarriage of justice and also whether the finding in this regard are perverse in law. b) Whether both the lower Courts have misappreciated the whole evidence and failure on the part of both the lower Courts in not considering the crucial evidence adduced on behalf of the defendant No.3, who is the present appellant herein is a substantial question of law. c) Whether both the lower Courts by overlooking Ex.B-16 the registered sale deed executed by the 1st defendant in favour of this appellant followed by payment of kist and also mutation proceedings which clearly establish that the property belonged to the 1st defendant and the subsequent conduct of the 1st defendant in colluding with the other defendants and these crucial facts have been ignored by both the lower courts. d) Whether both the lower Courts were correct in over-looking and ignoring the principle of law regarding Hindu Joint Family property regarding presumption that the property is joint till it is established by cogent, reliable evidence about the separateness and also acquisition by the 1st defendant that has been dislodged by the documentary evidence placed by this appellant. 16. I have considered the contentions of the plaintiff with reference to the evidence on record. I have seen the oral evidence recorded by the trial Court. P.W.1 in his chief-examination itself states: “…Originally we worked as coolies under one T. Guravaiah for about 3 to 4 years. Afterwards we three brothers began the Soda factory with T. Guravaiah on lease. The business is having the name and style of Kala and Company. We took it on lease and ran it four about 4 years. In 1971 we purchased from T. Guravaiah the Soda factory. Myself and two brothers are continuing Soda business. We are getting good profits in the said business. With the income from the said business we purchased item 1 of the plaint schedule from Ramalinga Reddy.” In the cross-examination he stated: “My father died in 1961 or 62, mother pre-deceased my father. We are three brothers and my brothers are D1 and D14. … My father had no ancestral properties. Myself and my brothers were doing coolie work. We had no ancestral house. We were residing in rented house. … I came to know in 1976 that the first defendant sold the lands in 1972. Myself and D1 are not in talking terms ever since the filing of the suit. …The suit property is assessed to tax in the name of D1. D1 is paying the tax. I am doing soda business. D1 and D14 are also doing same business. Since 1988 we are having separate licences. Prior to that licence was in the name of D1 alone. The title deed for the said house stands in the name of D1. He purchased on 21.06.1971. … D1 purchased the suit house from Ramlinga Reddy for Rs.2,000/-. Ex.B1 is the sale deed in the name of my brother – D1 under which he purchased item 1 of suit property. … By 1971 I was aged about 30 years. … It is not true that D1 purchased the property under Ex.B1 with his own funds as the self-acquired property and that we are having no rights in the suit property and that it does not belong to joint family. … I came to know in 1986 that D1 mortgaged item 1 of house property in TCT Bank. I filed EC into Court. I have not approached TCT Bank to redeem the mortgage. I do not know if D1 alone was paying the mortgage debt. … I do not know if D1 executed simple mortgage deed in favour of Sujathamma on 31.01.1986. EC disclosed the mortgage in favour of Sujathamma. I have not approached Sujathamma offering to discharge the debt to redeem the mortgage debt.” 17. P.W.2 is only a witness whose house is one furlong away from the plaintiff’s house and he claims that he knows plaintiff and his brothers since 1964. He claims that Ex.B1 property is not self-acquired property of the first defendant. He stated that he and another witness – Muni Ramaiah signed as identify witness in Ex.B1 and Ex.B1 was written in the name of the first defendant. He states that the plaintiff asked him on 16.06.1989 to give evidence and neither the first defendant nor defendant No.14 approached him. The witness volunteers that he used to advise the plaintiff and defendant No.14 that they would not loose the rights in the property even if the title deeds stand in the name of the first defendant. He again reiterates that he told the plaintiff and defendant No.14 that they did not loose their rights and on his advise, the plaintiff and defendant No.14 have objected to alienation of land by the first defendant. P.W.2, therefore, appears to be an advisor of plaintiff, who advised him of giving notice before suit and filing the suit etc. His evidence, however, is hardly of any probative value to consider the issue involved. 18. P.W.3 is one T. Guravaiah, who was the lessor of the plaintiff, first defendant and defendant No.14 and speaks of alienation of Soda machine to the first defendant. He has marked Ex.A1, which was executed about 18 years ago, wherein the sale of Soda machine is said to have been recorded. How this document remains with vendor is not explained. He states that the plaintiff, the first defendant and defendant No.14 paid the amounts but they have not signed in Ex.A1. This witness along with Ex.A1, obviously, is brought in to support the plaintiff that Soda machine was sold by him to all three brothers. 19. P.W.4 is another witness, who was a witness to the sale of lands i.e. other items under the plaint schedule property, and is not very relevant. 20. Thus, on behalf of the plaintiff, the oral evidence is only as mentioned above, which primarily consists of self-serving testimony of P.W.1. In a suit of this nature the burden is entirely on the plaintiff to prove the existence of any joint family property or at least the availability of a nucleus, which is sufficient to acquire the properties claimed as joint family properties. Evidence on record, in the present case, does not establish either of the two. Further, even existence of joint family is not established by the plaintiff and thereby no presumption can be drawn in favour of the plaintiff. There is no presumption that a family because it is joint, possesses joint property (see MAYNE’s HINDU LAW 14th Edition, Para 278). 21. Learned counsel for the appellant relied upon K.L.S.V.E. ANNAMALAI CHETTY’s case (1 supra) for the proposition that a member of joint undivided family can make separate acquisition of property for his own benefit and unless it can be shown that the business grew from joint family property or that the earnings were blended with joint family estate they remain free and separate. He also relied upon G. NARAYAN RAJU’s case (2 supra) and particularly para 3 thereof and the relevant portion of it is extracted hereunder: “3. …It is well established that there is no presumption under Hindu Law that business standing in the name of any member of the joint family is a joint business even if that member is a manager of the joint family. 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 joint family funds or that the earnings of the business were blended with the joint family estate, the business remains free and separate…” 22. Another decision in P.S. SAIRAM’s case (3 supra) is relied upon and particularly para 10 thereof, which is extracted hereunder: “10. The question to be examined in the present case is as to whether mere user of the joint family property (item No. property), as a business premises by Defendant 1, who was karta of the joint family, for running his separate business can be said to be in any manner detrimental to the joint family property? Undisputedly, the joint family had not invested a single farthing in the business at any point of time as it was started by Defendant 1 by raising loans from the market. Even according to the plaintiff, only a portion of said property was leased to one Md. Sharif in the year 1948 who vacated it in the year 1952. But it is not known during this period what was the rental of the said portion. There is no evidence to show whether after 1952, the said portion which was vacated by Md. Sharif was let out to anybody or remained vacant. So far as the other portion of the said property is concerned, undisputedly, in one part only, Defendant 1 was carrying on business. Apart from that, the trial court found that defendant No. 1 along with his first wife and children from her, including the plaintiff, resided therein till the year 1969 when his first wife died and the plaintiff was also carrying on his separate business in the very same property. It further found that as in the year 1970, the Defendant 1 married Sumitra Bai, Defendant 1(e), differences cropped up between the plaintiff and his father as a result of which Defendant 1 shifted to another house and resided therein with his second wife. These facts amply prove that joint family property was being used as business premises not only by karta but also by junior member of the joint Hindu family. There is no material whatsoever to show that user of the same as business premises by Defendant 1 was in any manner detrimental to the joint family property. This being the position, we have to no option but to hold that the business carried on by defendant No. 1 in the property described as Item 1 in the Schedule cannot be treated to be joint family business and the same remained his separate business throughout, especially in view of the fact that there was neither any case nor evidence to show any blending. In view of our conclusion aforementioned that the business was separate one of Defendant 1, properties enumerated as items 2, 3 and 4 in the Schedule acquired out of income of the said business, have got to be treated self-acquisitions of Defendant 1.” 23. The above legal position, therefore, is well settled and squarely applies to the present case where there is admittedly clear absence of any ancestral property or nucleus as admitted by P.W.1 himself. The first defendant has started earning as a coolie initially and then worked on the Soda machine by taking it on lease from P.W.3 and later started his own business and earned monies out of the same. The contention of the plaintiff, therefore, that there was any joint family is itself not established apart from the fact that there is no evidence to establish existence of any joint family or any property acquired through the funds of joint family. Both the Courts below have failed to take into consideration these basic principles relating to joint family and the joint family property and on an assumption have proceeded as if all the plaint schedule properties are joint family properties. In reaching the aforesaid conclusions, both the Courts below have also ignored the legal position settled by the Privy Council and as approved by the Honourable Supreme Court as early as in 1954 in SRINIVAS KRISHNARAOKANGO v. NARAYAN DEVJI KNAGO[5] and the relevant portion of para 10 is extracted hereunder: “10. Whether the evidence adduced by the plaintiff was sufficient to shift the burden which initially rested on him of establishing that there was adequate nucleus out of which the acquisitions could have been made is one of fact depending on the nature and the extent of the nucleus.