MORESHAR YADAORAO MAHAJAN VERSUS VYANKATESH SITARAM BHEDI (D) THR. LRS. AND OTHERS

MORESHAR YADAORAO MAHAJAN VERSUS VYANKATESH SITARAM BHEDI (D) THR. LRS. AND OTHERS

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले



1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. 5755-5756 OF 2011
MORESHAR YADAORAO MAHAJAN ...APPELLANT(S)
VERSUS
VYANKATESH SITARAM BHEDI (D)
THR. LRS. AND OTHERS ...RESPONDENT(S)
J U D G M E N T
B.R. GAVAI, J.
1. These appeals challenge the judgment dated 3rd July
2008 passed by the learned Single Judge of the High Court of
Judicature at Bombay in Second Appeal No. 264 of 1996,
thereby allowing the appeal filed by the respondents
challenging the judgment dated 13th June 1996 passed by the
2nd Additional District Judge, Yavatmal (hereinafter referred to
as the “Appellate Court”) in Regular Civil Appeal No. 61 of 1990
vide which the Appellate Court confirmed the judgment dated
28th March 1990 passed by the Civil Judge (Senior Division),
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Yavatmal (hereinafter referred to as the “trial court”) in Special
Civil Suit No. 21 of 1985 filed by the appellant vide which the
trial court had decreed the suit for specific performance filed
by the present appellant.
2. The parties hereto are referred to in accordance with
their status as before the trial court.
3. The plaintiff is a doctor who was working in a
Government Hospital. The plaintiff was also in private
practice. The plaintiff, for starting his private practice, took
on rent a part of the house of the defendant. It is the case of
the plaintiff that subsequently, the defendant was in financial
need for his agricultural cultivation and household expenses
and therefore, he suggested to the plaintiff that he should
purchase the said part of the house which the plaintiff was
occupying, together with an added portion. The plaintiff
accepted the said suggestion and an agreement to sell was
entered into on 24th July 1984. As per the terms of the said
agreement to sell, the defendant agreed to sell and the plaintiff
agreed to purchase the suit property for Rs.50,000/-. The
plaintiff paid an amount of Rs.24,000/- on the date of the
agreement and the defendant executed an earnest note in
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favour of the plaintiff. As per the terms of the agreement to
sell, the sale deed was to be executed before 31st March 1985.
It is the case of the plaintiff that on 31st July 1984, the
defendant again requested for money and on such request, the
plaintiff paid him an amount of Rs.6,000/-. It is also the case
of the plaintiff that pursuant to the aforesaid payment, he was
put in possession of the suit property on 31st July 1984.
4. It is further the case of the plaintiff that he was always
ready and willing to perform his part of the agreement and
therefore, he informed the defendant by registered letter that
he was willing to complete his part of the transaction before
31st March 1985. However, the defendant replied to the said
notice by alleging that the transaction was of money lending
and denied the execution of the sale deed. In this background,
the plaintiff filed a suit for specific performance before the trial
court. The trial court, vide judgment and decree dated 28th
March 1990, decreed the suit and directed the defendant to
execute the sale deed by accepting the balance sale
consideration as per the terms of the agreement to sell. It
further directed that if the defendant failed to execute the sale
deed, the same should be executed through the court. Being
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aggrieved thereby, the defendant preferred an appeal before
the Appellate Court which was also dismissed vide judgment
dated 13th June 1996.
5. The defendant thereafter preferred a second appeal
before the High Court which came to be partly allowed vide the
impugned judgment. Though the High Court denied the
specific performance, it directed the defendant to refund the
amount of Rs.30,000/- along with an interest at the rate of 9%
per annum from the date of the institution of the suit till its
realization. Hence, the present appeal is at the instance of the
plaintiff.
6. We have heard Shri Rahul Chitnis, learned counsel
appearing on behalf of the appellant and Shri Harin P. Raval,
learned Senior Counsel appearing on behalf of the
respondents.
7. Shri Chitnis submitted that a perusal of the
agreement to sell would reveal that the defendant had agreed
to sell the property since he needed money for farming and
household expenses. He submitted that the suit property
exclusively belonged to the defendant and as such, the finding
of the High Court that the suit property belonged to the joint
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family of the defendant i.e., his wife and three sons, is
untenable. He submitted that, in any case, the sale deed was
for meeting the legal necessities of the family and as such, the
High Court ought not to have interfered with the concurrent
findings of fact.
8. Shri Chitnis further submitted that the trial court had
held that, after partition, the house had come to the share of
the defendant. He submitted that both the trial court and the
Appellate Court have concurrently held that the transaction in
question was for the payment of antecedent debt and as such,
it was not necessary to join other members of the family or
other co-owners or other co-parceners as party defendants.
He submitted that the concurrent findings ought not to have
been interfered with by the High Court in second appeal.
Relying on the judgment of this Court in the case of Kasturi
v. Iyyamperumal and Others1, he submitted that it is only
the parties to a contract who are necessary parties. He further
submitted that since the contract was between the plaintiff
and the defendant, it was not at all necessary to implead the
defendant’s wife or sons as party defendants. He therefore

1
(2005) 6 SCC 733
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submitted that the High Court has erred in taking this aspect
into consideration while partly allowing the second appeal.
9. Shri Raval, on the contrary, submitted that the suit
property was a property jointly owned by the defendant, his
wife and three sons. He therefore submitted that the suit itself
was not maintainable on account of non-joinder of other
owners of the suit property.
10. Shri Raval further submitted that the learned Single
Judge of the High Court has rightly held that a mere
agreement to alienate cannot be enforced against a son on the
ground that the agreement was effected by the father for a
consideration which was formed by his own antecedent debts.
Shri Raval further submitted that a perusal of the plaint itself
would reveal that the plaintiff himself has admitted that the
suit property was owned by the defendant, his wife and three
sons. The learned Senior Counsel submitted that in view of
this admission, the suit filed by the plaintiff was itself not
tenable. He further submitted that the Appellate Court, after
having held that the trial court has erred in holding that the
suit property was the exclusive property of the defendant but
was in fact a joint property of the defendant, his wife and his
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three sons, has erred in dismissing the appeal filed by the
defendant. He too relies on the judgment of this Court in the
case of Kasturi (supra) to argue that it was not possible for
the trial court to pass an effective decree in the absence of
necessary parties. Relying on the judgment of this Court in
the case of Mumbai International Airport Private Limited
v. Regency Convention Centre and Hotels Private Limited
and Others2, he reiterated his submission that since the wife
and sons of the defendant were necessary parties, in their
absence, an effective decree could not have been passed. He
also relies on the judgment of this Court in the case of Poonam
v. State of Uttar Pradesh and Others3.
11. A perusal of the plaint would reveal that the plaintiff
himself, in paragraph (2), has stated thus:
“2. That the defendant and his sons viz. (i)
Laxman; (ii) Vivek and (iii) Jayant together with
defendant’s wife Sou. Saralabai constitutes a
joint Hindu family governed by Bombay School
of Hindu Mitaksharia Law. (The defendant is the
Karta of the family. The family inter-alia owns
residential premises within the limits of at
Wani……”

2
(2010) 7 SCC 417
3
(2016) 2 SCC 779
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12. The plaintiff has further averred in the plaint that in
the month of July 1984, the defendant got into financial
difficulties and that he had no money to carry on his large
cultivation. The defendant also required money for his
household expenses. It is further averred that besides this,
the defendant also had to pay some debts as there was no
prospect for the defendant to borrow money from the creditor.
13. It is the specific case of the defendant that initially, he
had taken an amount of Rs.24,000/- and thereafter,
Rs.6,000/- from the plaintiff by way of loan for his personal
purposes. The defendant, in his written statement, has
specifically stated that each of his sons are managing their
own properties and the defendant was not required to look
after their properties. The defendant has submitted that the
other members of the family, i.e., his wife and sons had
nothing to do with the amount borrowed by him from the
plaintiff. The defendant has stated that the borrowed amount
was spent by him for himself. The defendant has denied that
the said transaction was binding upon other members of his
family. It is specifically averred by him that the said
transaction was of money lending and the agreement was
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entered into only as a security towards the loan. The
defendant has subsequently stated thus:
“It is submitted that the defendant’s sons and
wife are necessary parties to this suit and their
non-joinder is fettled to the suit. The suit is
liable to be dismissed for non-joinder of
necessary parties. It is denied that the
defendant’s sons must be deemed to have given
their approval to the transactions. It is
submitted that deeming is always fictions and
no suit can be decreed on fictions.”
14. It is to be noted that in spite of this specific objection,
the plaintiff did not implead the defendant’s wife and sons as
party defendants.
15. Though the trial court framed the issue as to whether
the suit was bad in law for non-joinder of necessary parties, it
answered the same against the defendant by holding that the
defendant was the absolute owner of the suit property and
therefore, there was no question of joinder of his wife and three
sons.
16. The Appellate Court, vide its judgment, held that the
observation of the trial court that the suit property was the
exclusive property of the defendant was not correct. It held
that though the property was partitioned, the property
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remained as joint with the defendant, his wife and three sons.
It further held that since the defendant represents the entire
family and since the transaction in question was for payment
of an antecedent debt, it was not necessary to join other
members of the family or other co-owners or other coparceners.
17. This Court, in the case of Mumbai International
Airport Private Limited (supra), has observed thus:
“15. A “necessary party” is a person who ought
to have been joined as a party and in whose
absence no effective decree could be passed at
all by the court. If a “necessary party” is not
impleaded, the suit itself is liable to be
dismissed. A “proper party” is a party who,
though not a necessary party, is a person whose
presence would enable the court to completely,
effectively and adequately adjudicate upon all
matters in dispute in the suit, though he need
not be a person in favour of or against whom
the decree is to be made. If a person is not found
to be a proper or necessary party, the court has
no jurisdiction to implead him, against the
wishes of the plaintiff. The fact that a person is
likely to secure a right/interest in a suit
property, after the suit is decided against the
plaintiff, will not make such person a necessary
party or a proper party to the suit for specific
performance.”
18. It could thus be seen that a “necessary party” is a
person who ought to have been joined as a party and in whose
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absence no effective decree could be passed at all by the court.
It has been held that if a “necessary party” is not impleaded,
the suit itself is liable to be dismissed.
19. As already discussed hereinabove, the plaintiff
himself has admitted in the plaint that the suit property is
jointly owned by the defendant, his wife and three sons. A
specific objection was also taken by the defendant in his
written statement with regard to non-joinder of necessary
parties. Since the suit property was jointly owned by the
defendant along with his wife and three sons, an effective
decree could not have been passed affecting the rights of the
defendant’s wife and three sons without impleading them.
Even in spite of the defendant taking an objection in that
regard, the plaintiff has chosen not to implead the defendant’s
wife and three sons as party defendants. Insofar as the
reliance placed by Shri Chitnis on the judgment of this Court
in the case of Kasturi (supra) is concerned, the question
therein was as to whether a person who claims independent
title and possession adversely to the title of a vendor could be
a necessary party or not. In this context, this Court held thus:
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“7. …….From the above, it is now clear that two tests
are to be satisfied for determining the question who
is a necessary party. Tests are — (1) there must be a
right to some relief against such party in respect of
the controversies involved in the proceedings; (2) no
effective decree can be passed in the absence of such
party.”
20. It can thus be seen that what has been held by this
Court is that for being a necessary party, the twin test has to
be satisfied. The first one is that there must be a right to some
relief against such party in respect of the controversies
involved in the proceedings. The second one is that no effective
decree can be passed in the absence of such a party.
21. In view of the plaintiff’s own admission that the suit
property was jointly owned by the defendant, his wife and
three sons, no effective decree could have been passed in their
absence.
22. In that view of the matter, we find that no error can
be noticed in the judgment of the High Court. The appeals are
therefore liable to be dismissed.
23. In any case, the High Court, in order to balance the
equities, has partly decreed the suit and directed the
defendant to refund an amount of Rs.30,000/- with an interest
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at the rate of 9% per annum from the date of institution of the
suit till its realization. We affirm this direction of the High
Court.
24. In the result, the appeals are dismissed. Pending
application(s), if any, shall stand disposed of in the above
terms. No order as to costs.
…..….......................J.
[B.R. GAVAI]
…….......................J.
[C.T. RAVIKUMAR]
NEW DELHI;
SEPTEMBER 27, 2022.

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