Case: Gulam Abbas Vs. Haji Kayyum Ali &amp; Ors

1. This is a Defendants appeal by Special Leave against the Judgment and decree of the High Court of Madhya Pradesh allowing a second appeal in a partition suit between members of a family governed by Muslim law. The Defendant-Appellant and the Plaintiff-Respondent are both sons of Kadir Ali Bohra who died on 5-4-1952 leaving behind five sons and a daughter and his widow as his heirs. It appears that Kadir Ali had incurred debts so heavily that all his property would have been swallowed up to liquidate these. Three of his sons, namely, Ghulam Abbas, Defendant No. 1, Abdullah, Defendant No. 2, and Imdad, Defendant No. 3, who had prospered, came to his rescue so that the property may be saved. But, apparently, they paid up the debts only in order to get the properties for themselves to the exclusion of the other two sons, namely Kayyumali, Plaintiff-Respondent, and Nazarali, Defendant No. 4, who executed, on 10-10-1942, deeds acknowledging receipt of some cash and moveable properties as consideration for not claiming any rights in future in the properties mentioned in the deeds in which they gave up their possible rights in future. The executant of each deed said :"I have accordingly taken the things mentioned above as the equivalent of my share and I have out of free will written this. I have no claim in the properties hereafter and if I put up a claim in future to any of the properties I shall be proved false by this document. I shall have no objection to my father giving any of the properties to my other brothers. . . . . . . . . . . ."During the fathers lifetime, when all chance or expectation of inheritance by either Kayyumbi or Nazarali could be destroyed by disposition of property, neither of these two raised his little finger to object. The only question before us now is whether the plaintiff and Defendant No. 4 are estopped by their declarations and conduct and silence from claiming their shares in the properties covered by these deeds.        2. The first appellate Court, the final Court on questions of fact, recorded the following findings, after examining the whole set of facts before it, to conclude that the plaintiff and defendant No. 4 were estopped from claiming their shares in the inheritence :"In the instant case, it is evident that the release deeds Ex. D/2 and Ex. D/3 were executed by the plaintiff and defendant No. 4, Nazarali, when the defendants Nos. 1, 2 and 3 had with their labour and money straightened the status of their father Kadarali and had cleared up the debts which would have devoured the whole property of Kadar Ali and the plaintiff was doing nothing and was in a way a burden to his father. In such state of things when the plaintiff and defendant No. 4 executed the release deeds in question, it can be said that it was a family settlement to prevent the future disputes that may arises and to secure the peace and happiness in the family of the parties and thereby induced the defendants Nos. 1, 2 and 3 to believe that the plaintiff would not claim a share in the suit properties and led them to discharge the debts due to Kadar Ali and to be in affluent circumstances themselves as they are at present and the plaintiff now seeks benefit of it against his own past undertakings."3. The High Court reproduced the passage, quoted above, from the judgment of the First Appellate Court, with out any dissent from any of the findings of fact contained there. It specifically held that the Court below was correct in finding that consideration had passed to the Plaintiff and Defendant No. 4 for the relinquishment of their future possible rights of inheritance. It proceeded on the assumption that, if the law had not prohibited the transfer of his right of inheritance by a Muslim heir, an estoppel would have operated against the Plaintiff and Defendant No. 4 on the findings given. It held that the rule of Muslim Personal law on the subject has the same effect as Section 6 (1) of the Transfer of Property Act which lays down :"The chance of an heir-apparent succeeding to an estate, the chance of a relation obtaining a legacy on the death of a kinsman; or any other mere possibility of a like nature, cannot be transferred". It pointed out that, although, Section 2 of the Transfer of Property Act provided that nothing in the second Chapter of the Act will be deemed to affect any rule of Mohammedan Law, so that Section 6 (a) contained in Chapter 2 could not really be applied, yet, the effect of Mahomedan Law itself was that "the chance of a Mahomedan heir apparent succeeding to an estate cannot be the subject of a valid transfer or lease" (See : Mullas Principles of Mohamedan Law - 17th Edn. S. 54, page 45). After equating the effect of the rule of Mahomedan Law with that of Section 6 (a) of the Transfer of Property Act, the High Court applied the principle that no estoppel can arise against statute to what it considered to be an estoppel put forward against a rule of Mahomedan Law4. The High Court had relied on a decision of the Madras High Court in Abdul Kafoor v. Abdul Razack, AIR 1959 Mad 131   which had been followed by the Kerala High Court without giving fresh reasons, in V. Kunhi Avulla v. E. P. Kunhi Avulla, AIR 1964 Ker 200   in preference to the view adopted by the Allahabad High Court in Latafat Husain v. Hidayat Hussain, AIR 1936 All 573 followed by the Travancore Cochin High Court in Kochunni Kochu Muhammed v. Kunju Pillai Muhammed, AIR 1956 Trav-Co 217. The principal question for decision before us is whether the Madras or the Allahabad High Court view is correct.        5. The Madras High Court, in Abdul Kafoors case, AIR 1959 Mad 131   (supra), had specifically dissented from the Allahabad view in Latafat Hussains case, AIR 1936 All 573 (supra) on the ground that, if an estoppel was allowed to be pleaded as a defence, on the strength of relinquishment of a spes successions for consideration, the effect would be to permit the provision of Mohammedan Law to be defeated. Hence, it held that such an attempt would be struck by Section 23 of the Indian Contract Act. The object, however, of the rule of Mohamedan Law, which does not recognise a purported transfer of a spes successions as a legally valid transfer at all, is not to prohibit anything but only to make it clear what is and what is not a transferable right or interest in property just as this is what Section 6 (a), Transfer of Property Act is meant to do. Its purpose could not be to protect those who receive consideration for what they do not immediately have so as to be able to transfer it at all. It could, if protection of any party to a transaction could possibly underlie such a rule, be more the protection of possible transferees so that they may know what is and what is not a legally enforceable transfer. With due respect, we are unable to concur with the view of the Madras High Court that a renunciation of an expectancy, as a purported but legally ineffective transfer, is struck by Section 23 of the Indian Contract Act. As it would be void as a transfer at all there was no need to rely on Section 23, Contract Act. If there was no "transfer" of property at all, which was the correct position, but a simple contract, which could only operate in future, it was certainly not intended to bring about an immediate transfer which was all that the rule of muslim law invalidated. The real question was whether, quite apart from any transfer or contract, the declarations in the deeds of purported relinquishment and receipt of valuable consideration could not be parts of a course of conduct over a number of years which, taken as a whole, created a bar against a successful assertion of a right to property when that right actually came into being. An equitable estoppel operates, if its elements are established, as a rule of evidence preventing the assertion of rights which may otherwise exist.

Court's reasoning:
14. As we are clearly of opinion that there is nothing in law to bar the application of the principle of estoppel, contained in Section 115 of the Evidence Act against the Plaintiff and Defendant No. 4, upon the totality of facts found by the final Court of facts, which were apparently accepted by the High Court, it is not necessary for us to deal at length with the question whether the facts found could give rise to the inference of a "family settlement" in a technical sense15. It is true that in Latafat Hussains case, AIR 1936 All 573 (supra), Suleman, C. J., had observed that the conclusion of the Subordinate Court, that there had been an arrangement between a husband and a wife "in the nature of a family settlement which is binding on the plaintiff", was correct. This was held upon circumstances which indicated that a husband would not have executed a deed of Wakf if the wife had not relinquished her claim to inheritance. In other words, an arrangement which may avoid future disputes in the family, even though it may not technically be a settlement or definition of actually disputed claims, was referred to broadly as a "family arrangement". It was in this wide sense that, in the case before us also, the first appellate Court had considered the whole set of facts and circumstances examined by it to be sufficient to raise the inference of what it described as "a family settlement"16. As our law relating to family arrangements is based on English law, we may refer here to a definition of a family arrangement in Halsburys Laws of England, 3rd Edn. Vol. 17, p. 215-216 where we find : "A family arrangement is an agreement between members of the same family intended to be generally and reasonably for the benefit of the family either by compromising doubtful or disputed rights or by preserving the family property or the peace and security of the family by avoiding litigation or by saving its honour". We also find there : "The agreement may be implied from a long course of dealing, but it is more usual to embody or to effectuate the agreement in a deed to which the term family arrangement is applied". It is pointed out there : "Matters which would be fatal to the validity of similar transactions between strangers are not objections to the binding effect of family arrangements"17. As we have already indicated, it is enough for the decision of this case that the plaintiff and defendant No. 4 were estopped by their conduct, on an application of Section 115 Evidence Act, from claiming any right to inheritance which accrued to them, on their fathers death, covered by the deeds of relinquishment for consideration, irrespective of the question whether the deeds could operate as legally valid and effective surrenders of their spes successions. Upon the facts and circumstances in the case found by the Courts below we hold that the plaintiff and defendant No. 4 could not, when rights of inheritance vested in them at the time of their fathers death, claim these as such a claim would be barred by estoppel.