IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD THE HON'BLE SRI JUSTICE P. DURGA PRASAD A.S.Nos.138 of 1994, 177 of 1994 & Tr.A.S.No.826 of 2003 Date: 21.01.2011 A.S.No.138 of 1994 Between: Yentrapragada Satyanarayana and 2 others. .....Appellants AND: Annamreddi Srinivas and 3 others. ....RESPONDENTS A.S.No.177 of 1994 Between: Smt Koyyalamudi Anantha Laxmi .....Appellant. AND: Sri Annamreddi Srinivas and 4 others. ...RESPONDENTS Tr.A.S.No.826 of 2003 Between: Sri Edupuganti Gopalakrishna .....Appellant. AND: Sri Annamreddi Rama Rao and another ....RESPONDENTS THE HON'BLE SRI JUSTICE P. DURGA PRASAD A.S.Nos.138 of 1994, 177 of 1994 & Tr.A.S.No.826 of 2003 COMMON JUDGMENT: These three appeals are directed against the common judgment passed in O.S.No.82 of 1984 and O.S.No.14 of 1986. A.S.No.138 of 1994 is filed by the defendants 2 to 4 in O.S.No.82 of 1984 on the file of Subordinate Judge Court, Kovvur, West Godavari and A.S.No.177 of 1994 is filed by defendant No.9 in O.S.No.82 of 1984 on the file of Subordinate Judge Court, Kovvur, West Godavari District. Transfer A.S.No.826 of 2003 is filed against the judgment passed in O.S.No.14 of 1986 by the Subordinate Judge, Kovvur, West Godavari District by the plaintiffs therein. The respondent No.1 in A.S.Nos.138 of 1994, 177 of 1994 and respondent No.2 in Tr.A.S.No.826 of 2003 has filed the suit O.S.No.84 of 1984 for partition and separate possession of 1/4th share in the suit schedule properties. The brief averments of the plaint in O.S.No.82 of 1984 are that the first defendant is the father of the plaintiff. The plaintiff and the 1st defendant constitute a joint Hindu family and the 1st defendant is the Kartha. The joint family owned the properties more particularly described to the schedule attached to the plaint. The schedule properties fell to the share of the 1st defendant in partition with his brothers. Out of the schedule properties the plaintiff is having a joint half share. The plaintiff and the 1st defendant belong to the family of agriculturists and the only avocation of the 1st defendant is agriculture. The 1st defendant has two daughters apart from the plaintiff. For the last about eight years the first defendant has not been attending to the cultivation of the lands and he has been wasting away the income of the lands. The first defendant has been addicted to vices like gambling and particularly in ‘Kodi Pandelu’. The first defendant has been contracting debts for his vices. More over the first defendant started a risky and speculative new business all by himself in fancy goods at Nidadavole about 7 years back under the name and style of ‘Sridevi Fancy stores’. The first defendant has no previous experience of business and by starting the said business he has completely stopped the cultivation. Thus, the first defendant has been carrying on with his vices and the speculative business. For his alleged immoral purposes and speculative business, the first defendant appeared to have contracted debts at huge rates of interest. The alleged debts having been contracted for the said vices and the new business they are all ‘avyavaharika’ debts and they are not binding on the minor plaintiff. Since three years the first defendant has completely neglected the family and also sustained heavy losses in the business and ultimately gave up the said business and got himself involved in vices i.e., gambling etc., In order to satisfy his vices he has been alienating the joint family properties and causing loss to the minor plaintiff. The 1st defendant has alienated items 1 and 2 of the schedule in favour of defendants 2 and 3 and 3rd item in favour of fourth defendant and that the 6th item house also proposed by him to be alienated in favour of 5 and 6 defendants. The said alienation are not genuine or valid. The said alienations are not binding upon the minor plaintiff. The plaintiff is entitled to ignore the alienation made by the first defendant for illegal and immoral proposes and ask for partition of his share in the entire schedule properties. The alienations are not made for legal necessity and family benefit. The alienations are made in favour of the close relations of the first defendant. The defendants 2 to 6 know fully well about the vices of the first defendant and obtained sale deeds by contracting debts. The schedule properties are very rich and fertile lands and are yielding very good crops like Tobacco, chillies, sugar cane, wet paddy and mangoes. There is no need to contract any debt for the cultivation of the lands or for the family. As the first defendant has been wasting away the properties, the plaintiff’s mother disputed with the first defendant several times but he did not change his habits. The plaintiff and his mother and sisters are looked after by their maternal grandfather from the last three years. Under the said circumstances, it is not safe to keep the properties in joint and constructive possession with the 1st defendant and the partition of the family properties is beneficial to the minor plaintiff. The plaintiff in joint and constructive possession of the suit properties being coparcener. But he is not in physical possession of the same. The alienated properties are in possession of the first defendant as manager. The plaintiff’s next friend mother on behalf of the plaintiff issued a registered notice to the defendants claiming partition of the schedule properties. On 11.02.1983 the defendants received the notices and the defendants 2 to 4 issued a reply on 07.03.1983 with absolutely false and untenable allegations. The averments of the reply notice that the alienations are made for discharging the family debts and that the debts are binding on the plaintiff and that the said debts are contracted for legal necessity and family benefit and that bore wells were dug in three defendant places spending Rs.20,000/- and that the first defendant purchased a house and site at Nidadavole for Rs.30,000/- and that the first defendant improved the business at Nidadavole and the agriculture at Tyajampudi and Chikkala and the first defendant was educating the children are all not true and valid. The first defendant did not purchase any house and site and he did not dig any wells. The alleged debts are all concocted for the purpose of the sale deeds in the names of the kith and kin of the defendants 2 to 4. The said debts are not genuine debts. They are all not made for legal necessity or family benefit. Even if there are debts contracted by the first defendant they are all ‘avyavaharika’ debts not binding upon the minor plaintiff. The alienations are invalid and not binding upon the minor plaintiff. The business being a new speculative business carried on by first defendant the said business and its losses and liabilities are not binding on the plaintiff. Hence, the plaintiff is entitled to partition of his half share in the plaint schedule properties. Hence the suit. The first defendant remained exparte. The 2nd defendant filed written statement contending that the 1st defendant and his children went to Nidadavole for about ten years back for education of the children after leasing out the plaint schedule land and house to others and he denied about the first defendant neglecting the cultivation and wasting the income of the lands. Even now the first defendant is leasing out the items 4 to 6 of the plaint ‘A’ schedule properties and collecting rents regularly. He also denied that the first defendant has been addicted to vices like gambling and particularly in ‘Kodi Pandelu’. The first defendant immediately after shifting the family to Nidadavole, started fancy goods business under the name and style of ‘Sri Devi Fancy stores’. The first defendant ran the business for 8 years in a rented shop, main road, Nidadavole owned by the Municipality, Nidadavole. The first defendant ran the shop with huge profits, collecting rents from the plaint schedule items 4 to 6 and educating the children concurrently. He denied that the fancy goods business is a speculative one and needs previous experience. In fact, it is a standard business, profit oriented percentage business. No damage, nor perishable goods, nor expired and there is no scope for speculation. It does not require any skill or special knowledge or previous business experience for carrying business in fancy goods. Even a layman or a small kid can maintain and run a fancy goods shop. The first defendant ran the fancy goods shop regularly and earned huge profits. There was no scope or time for the first defendant to addict vices like gambling and ‘Kodi Pandelu’. On the other hand, ‘Kodi Pandelu’ were banned by the Government. The alleged vices, addicted by the first defendant consumes more time. There is no allegation in the plaint that the first defendant neglected the business except cultivation. The first defendant leased out the items 4 to 6 of the properties and there is no need and necessity to attend the cultivation. The debts were contracted for investment in agriculture and business. The first defendant borrowed money and fertilisers and cash from Agricultural Development Bank (Land Mortgage Bank), Kovvur and Cooperative Society, Kurukuru respectively. The 1st defendant dug bores at four places in the land of his wife at Tyjampudi. He raised sugar cane in his wife’s land and supplied the sugar cane to M/s. Seetharama Sugars, Tadimalla. The debts contracted by the first defendant for the investment in Agriculture for maintaining the joint family business and children’s education and these debts are not ‘avyavaharika’ debts and the same are binding on the plaintiff. The 2nd defendant purchased item 1 of the plaint schedule land from the first defendant and his son (plaintiff) under a registered sale deed dated 22.09.1981 for a valuable consideration of Rs.13,500/-. The second defendant at the instance of the first defendant out of the said amount from the sale consideration discharged the debts of Rs.700/- to Cooperative Agricultural Bank, Rs.3,904/- to Kurukuru Society, Rs.2,300/- to Kakarla Butchirayudu of Malakapalli, Rs.2,286/- to Neerukonda Injayalakshmi, wife of Mohana Rao, Chodavaram, Rs.1040/- to Yentrapragada Suryarao, son of Ratnam, Rs.3,120/- to Yentrapragada Kanaka Ratnam, wife of Satyanarayana and paid Rs.150/- to the first defendant. Thus, the 2nd defendant paid all the entire sale consideration of Rs.13,500/- to the first defendant and took possession of the land, paying land revenue and enjoying the same peacefully. The 2nd defendant put the receipts and the pronotes duly discharged endorsements by the promises kept as vouchers to the registered sale deed. Prior to the purchase of item-I of the plaint schedule land by the 2nd defendant, the 1st defendant leased out the land year by year to one Yedru Satyam, Atchanta Venkata Ratnam, Mogali Lakshmana Rao, Mullapudi Suryachendram, Atchanta Ammiraju and to Atchanta Ramulu. The 2nd defendant purchased item-II of the plaint schedule land under a registered sale deed dated 15.07.1982 for a valuable consideration of Rs.15,880/-. The 3rd defendant discharged the debts on behalf of the first defendant from sale consideration by making payment of Rs.7,296/- to Karuturi Sreeramulu, Pallantla, Rs.4,272/- to the 3rd defendant, Rs.4,256/- to Koyyalamudi Kameswara Rao, Kurukuru and Rs.56/- to the first defendant. Prior to the purchase the land was leased out by the first defendant year by year to Kuchipudi Suranna, Yedru Satyam, Atchanta Venkata Ratnam, Karuturi Sreeramulu, Tata Abbayai and Atchanta Ramarao. The 4th defendant is no other than the first defendant’s sister husband. The 4th defendant purchased item 3 of the plaint schedule land for a valuable consideration of Rs.40,000/-. The first defendant and his wife executed a stamped agreement dated 03.09.1977 in favour of the fourth defendant. He paid Rs.20,000/- to the first defendant and his wife at the time of agreement and Rs.20,000/- on 20.07.1978 and the same was endorsed on the back of the sale agreement by the first defendant and his wife. The 4th defendant took possession of the land on 8.9.1977 paying land revenue and enjoying the same without any interruption. The first defendant and his wife endorsed on the back of the agreement that they would registered the land as and when asked by the fourth defendant. In spite of repeated demands, by the fourth defendant for registration, the first defendant and his wife postponing the same on one pretext or the other. At last the 4th defendant issued a registered notice dated 4.3.1983 through his advocate to the first defendant and his wife, requesting them to attend and register the land on 24.3.1983 before the Sub Registrar Kovvur. The 1st defendant and his wife did not turn up. The first defendant and his wife are living together in the same house and received notice and till now the first defendant and his family are living together and running a fancy shop business at some other place at ‘Nidadavole’. The 4th defendant will take appropriate steps against the first defendant and his wife for registration. The plaintiff has no right to question the valuable sale transactions and enjoyment and has no right to claim profits in the item 1 to 3 of the plaint schedule land. The 2nd defendant admits that he and the defendants 3 and 4 received notices from the advocate of the plaintiff and gave reply with true allegations on 7.3.1983. These defendants believe that the first defendant purchased a house and site for Rs.30,000/- not yet registered in order to harass these defendants and genuine creditors. He denied that all the debts concocted for the purpose of sale deeds in the names of kith and kin of the defendants 2 to 4. The plaintiff being a member of the joint family, the act done by the first defendant as a manager of the joint family, the profits and losses will be borne by and binding on the plaintiff, he is not entitled to ask for partition, separate possession and profits of the plaint ‘A’ schedule properties especially items 1 to 3 of the plaint schedule properties. The defendants 3 and 4 filed a memo adopting the written statement filed by the 2nd defendant. The 5th defendant filed written statement pleading that himself and 6th defendant are added as defendants unnecessarily and they are not necessary and proper parties to the suit. The suit is also liable to be dismissed for mis-joinder of the parties. He further pleaded that the first defendant is the man behind the entire litigation. The first defendant instigated the plaintiff to file this false and frivolous suit. The 1st defendant borrowed an amount of Rs.6,000/- from this defendant on 4.12.1979 and executed a demand promissory note in favour of this defendant. Subsequently, the 1st defendant paid the above pronote amount of Rs.8,000/- after calculating the interest etc., and after deducting some amount through Sri P. Narayana. The said pronote was handed over to Sri Pinnamani Narayana as a voucher. The 1st defendant borrowed the above amount from this defendant for agricultural expenses and for family expenses and for not any other purpose. In fact, the 1st defendant is a good business man besides a good agriculturist. He denied that the first defendant contracted debts for his speculative business at huge rates of interests. He also denied that himself and the 6th defendant are fully aware about the vices of the first defendant. In fact the 6th item was sold in favour of one Pinnamani Narayana for a valuable consideration of Rs.16,500/- under an agreement of sale dated 24.11.1982 and with that amount the 1st defendant discharged the debt due to this defendant and the suit debt in O.S.No.756 of 1982 due to Sri Edupuganti Venkata Krishna Rao. At the instigation of the first defendant this suit has been filed against the defendants to harass and to delay and defraud the creditors. The plaintiff knows fully well that the item No.6 was sold in favour of Sri Pinamani Narayana. He is the necessary and proper party to the suit. The 6th defendant filed a memo adopting the written statement filed by the 5th defendant. The 8th defendant filed written statement pleading that the first defendant has borrowed the amount of Rs.2,000/- as debt from this defendant for the investment in the agriculture of the joint family. And the 1st defendant has executed pronote in his own handwriting in favour of this defendant on 19.2.1981 agreeing to pay interest at the rate of Rs.1/- per hundred, per one month. For the cause of the debt when the said pronote was pending as O.S.No.92 of 1983 in Munsiff Court at Kovvur, it was transferred to the Subordinate Judge court, Kovvur as O.S.No.14 of 1986. The first defendant acts as the joint family Manager and having obtained loan for the cause of investment of joint agriculture, the plaintiff who is the joint family member is also responsible to discharge the debt of the suit bearing O.S.No.14 of 1986. The 9th defendant filed written statement pleading that the 1st defendant is an agriculturist devoting all his time for bettering the fortunes of the family. He has not been addicted to vices like gambling, and ‘Kodi Pandelu’ as alleged in para 4 of the plaint. He is leading a perfectly clean life and the averment relating to gambling and cock-fighting etc., are not correct. This defendant never neglected the family and if he has giving up his business it does not mean that he is involved ‘in vices like gambling’ etc. So far as this defendant’s debt is concerned it is contracted by the father i.e., first defendant for agricultural purposes and it cannot be questioned on any conceivable ground. The alienations are made by the first defendant for satisfying his so called vices. In the course of running the family it becomes some times necessary to contract debts and even alienate properties and from that circumstances it is not inferable that the alienations are not made for legal necessity or family benefits. No notice of the partition suit viz., this suit is given to this defendant prior to institution and this suit is only one more step in the direction of delaying the payment of the defendant’s debt. In execution of the decree obtained by this defendant in O.S.No.36 of 1983 against the first defendant the properties belongs to joint family are brought to sale and there was bitter competition among the bidders who came in large numbers of their own accord to participate in the auction. The price secured is far higher than the intrinsic value and it is perhaps one of the few auctions held in courts where the fiercest competition is witnesses among scarce of bidders assembled in court. The debt contracted by the first defendant resulting in the decree in favour of this defendant is certainly binding upon the plaintiff and it is not open to the plaintiff to question the same on any of the grounds mentioned in the plaint. It is not beneficial to the minor plaintiff to ask for partition at this stage as it would result in splitting up of the holding and increase the costs of cultivation. Hence the suit is liable to be dismissed. The defendants 16 and 17 filed written statement pleading that their shares also may be separated and separate possession may be given to them along with the plaintiff. These defendants will pay to necessary court fee and general stamp duty for their separated shares. These defendants may also be granted fast and future profits and prays to pass for separation of their shares with profits and with costs as against the defendants 1 to 15. On the above pleadings, the following issues and an additional issue were framed by the lower court: 1. Whether the debts contracted by the first defendant as Manager of Hindu Joint family are Avyavaharika debts? 2. Whether the suit is bad for non-joinder of some of the properties? 3. Whether the business in fancy goods in a speculative business? 4. Whether the valuationof the suit is true and correct and the court-fee paid is correct? 5. Whether the defendants 2 to 4 are entitled to ask for equitable relief? 6. Whether the plaintiff is entitled to ask for partition and separate possession and profits on plaint ‘A’ schedule properties? 7. To what relief? Additional issue: 1. Whether the defendants 16 an 17 are entitled to 1/4th share each in all the plaint schedule properties? O.S.No.14 of 1986 is filed originally before the District Munisiff Court, Kovvur and registered as O.S.No.92 of 1983. Later it was transferred to the Subordinate Court at Kovvuru. The suit is filed for recovery of an amount of Rs.2,481.33 ps. According to the plaintiff, the first defendant borrowed an amount of Rs.2,000/- from the plaintiff for agricultural expenses and executed a promissory note on 19.12.1981 agreeing to pay interest at the rate of 12% p.a. The 2nd defendant is the son of first defendant and also the plaintiff in O.S.No.82 of 1984. The first defendant is also the first defendant in O.S.No.82 of 1984. The suit was filed on 21.02.1983. The first defendant remained exparte. The 2nd defendant filed written statement stating that the suit debt is not true and not supported by consideration. The first defendant in collusion with the plaintiff got filed this suit. The first defendant is addicted to vices. He is wasting the properties. The debt is an ‘avyavaharika’ debt and not binding on him. On the above pleadings, the following issues were framed: 1. Whether the suit pronote debt is true, valid an binding upon the minor defendant? 2. To what relief? Common evidence was recorded in O.S.No.82 of 1984. On behalf of the plaintiffs, P.Ws.1 to 4 are examined and Exs.A.1 to A.9 are marked. On behalf of the defendants, DWs.1 to 20 are examined and Exs.B-1 to B-58 are marked. The lower court after taking into consideration of both oral and documentary evidence disposed of all the suits by common judgment by decreeing suit in O.S.No.82 of 1984 against the defendants 1 to 17 in favour of the plaintiff. A preliminary decree was passed for partition of the plaint schedule properties into four equal shares, the plaintiff, first defendant, defendants 16 and 17 are entitled to one share each. As far as possible, the properties alleged to be in possession of the alienees shall be allotted to the share of the first defendant. This does not mean that the alienations are recognised. The court fee due on the plaint shall be paid by the defendants 2 to 6, defendants 9 and 11 to 15 jointly and severally. The defendants 2 to 6, 9 and 11 to 15 shall pay costs to the plaintiff only in proportion to the value of the properties claimed by them. The defendants 16 and 17 are not entitled to costs and they are not liable to pay costs to the plaintiff. Aggrieved by the said common judgment, defendants 2 to 4 have filed the appeal in A.S.No.138 of 1994 and the defendant No.9 has filed appeal in A.S.No.177 of 1994 and the defendant No.8 who is the plaintiff in O.S.No.14 of 1986 has filed the Transfer Appeal Tr.A.S.No.826 of 2003. The points that arise for consideration are: 1. Whether the debts contacted by the 1st respondent herein as a Manager of the Hindu Joint Family are ‘avyavaharik’ debts? 2. Whether the plaintiffs in O.S.No.82 of 1984 who is the respondent No.1 is entitled for partition of the ‘A’ schedule properties as prayed for? 3. Whether the suit promissory note in O.S.No.14 of 1986 is true, valid and binding on the defendants therein? 4. To what relief? Point No.1: The learned counsel for the appellant has pleaded that the said debts contacted by the 1st defendant in the suit are for his joint family necessities i.e., for agriculture and running the fancy shop and as such they are binding on the plaintiff as a member of the joint family, as such the alienation made by D-1 in favour of D-2 to D-4 are legal, valid and binding on the plaintiff therein. The appellant’s