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K. NAINA MOHAMED(DEAD) THROUGH LRS. Vs. A.M. VASUDEVAN CHETTIAR(D)BY LRS. & ORS.

K. NAINA MOHAMED(DEAD) THROUGH LRS. Vs. A.M. VASUDEVAN CHETTIAR(D)BY LRS.

                                                            REPORTABLE


                   IN THE SUPREME COURT OF INDIA

                   CIVIL APPELLATE JURISDICTION

                   CIVIL APPEAL NO. 8365 OF 2002


K. Naina Mohamed (Dead)                             ........Appellants
through L.Rs.

                   Versus

A.M. Vasudevan Chettiar (Dead)                      ..........Respondents
through L.Rs. and others

 


                             JUDGMENT


G.S. Singhvi, J.


1.    This appeal is directed against the judgment of the learned Single

Judge of Madras High Court, who allowed the second appeal preferred by

respondent Nos.1 and 2 - A.M. Vasudevan Chettiar and A.M. Nagamian

Chettiar, set aside the judgment of District Judge, Tiruchirappalli

(hereinafter described as `the lower appellate Court') and restored the decree

passed by Subordinate Judge, Tiruchirappalli (hereinafter described as `the

trial Court') in a suit filed by them for directing Rukmani Ammal, her son,
                                                                              2


A.B.M. Ramanathan Chettiar and appellant - K. Naina Mohamed (defendant

Nos.1 to 3 in the suit) to execute sale deed in their favour in respect of

property bearing Municipal Door No.58, Walaja Bazaar Street, Woriur,

Tiruchirapalli Town and Talluk (hereinafter described as, `the suit

property').

 

2.    The suit property belonged to one Smt. Ramakkal Ammal wife of

Pattabiraman of Uraiyur of Tiruchirapalli. She executed registered Will

dated 22.9.1951 in respect of her properties and created life interest in

favour of her two sisters, namely, Savithiri Ammal and Rukmani Ammal

with a stipulation that after their death their male heirs will acquire absolute

right in `A' and `B' properties respectively subject to the rider that they shall

not sell the property to strangers. Clauses 4, 10 and 11 of the Will and

details of `A' and `B' properties (English translation of the Will and details

of the properties were made available by the learned counsel after

conclusion of the arguments), which have direct bearing on the decision of

this appeal read as under:

      "(4) My sisters i) Savithri Ammal, wife of A.R. Manickam
      Chettiar, residing at Madukkur, Pattukkottai Taluk, Thanjavur
      District and ii) Rukumani Ammal, wife of A.B. Muthukrishna
      Chettiar, residing at Bazaar Street, Karur, Karur Taluk shall
      inherit and enjoy House Properties detailed hereunder after my
      life during their lifetime without encumbering the same during
                                                                     3


their life time and receive the income therefrom equally among
them after paying the taxes.

(10) After my lifetime if any one of my sisters die that sister's
share of `A' & `B' mentioned properties shall go to the male
heirs of the deceased person. After demise of both sisters, the
male heirs of Savithiri Ammal shall obtain `A' property in
equal shares and the male heirs of Rukumani Ammal shall
obtain `B' property subject to conditions specified in clause 11
hereunder with absolute rights.

(11) As and when Savithiri Ammal's male heirs get and enjoy
`A' property and as and when Rukmani Ammal's heirs get and
enjoy `B' property, if any one of them wants to sell their share,
they have to sell to the other sharers only as per the market
value then prevailing and not to strangers.

                      `A' Property Details

The Terraced House with tiled Verandhas including open
backyard with water pump and meter at Walaja Bazaar Street,
Thamalvaru Bayamajar, Woriur, 3rd Block, A Ward, Puthur
Circle, Tirchirapallai Town to the West of Bazaar lying North
to South, to the North of `B' Item Property hereunder and the
backyard of Muthu Veerswami Chettiar to the East of Padmaji
Lane and to the South of the House belonging to Krishnammal,
wife of Venogopal Naidu bounded on the
NORTH BY            : Survey No.2069
SOUTH BY            : Survey No.2067
EAST BY             : Survey No.2065 and
WEST                : Survey No.2088

situate within the Registration District of Tirchirapalli and Sub-
Registration District No.3 Joint Sub-Registrar.

                      `B' Property Details

Tiled House and vacant site on the above said Walaja Bazaar
Street, bearing Municipal Door No.58 lying to the West of
Bazaar lying South to North, to the North of House of Muthu
                                                                          4


      Veerasami Chettiar, to the East the aboe Muthu Veerasami
      Chettiar's backyard, to the South `A' item Property running 126
      feet from East to West and 12 feet on the Eastern side from
      South to North and 8 feet on the Western Side from South to
      North comprised in T.S. No.2067"


3.    Savithiri Ammal died in February 1979. After about two years, one of

her three sons, namely, A.M. Krishnamurthy filed a suit (O.S. No.473 of

1981) for partition of his share in `A' property. He impleaded Rukmani

Ammal as one of the defendants. The suit was disposed of in terms of the

compromise arrived at between the parties, which envisaged that the plaintiff

therein and his brothers will divide `A' property among themselves and `B'

property will be the absolute property of Smt. Rukmani Ammal and her

descendants.

 

4.     Soon after disposal of O.S. No.473 of 1981, Rukmani Ammal and her

son, A.B.M. Ramanathan Chettiar executed registered sale deed dated

9.12.1982 in favour of the appellant in respect of the suit property.

Respondent Nos.1 and 2 challenged the same in O.S. No.226 of 1983. They

pleaded that in view of the restriction embodied in clause 11 of the Will,

Rukmani Ammal and her son could not have sold the property to a stranger.

They prayed that the sale deed be declared void and defendants in the suit be

directed to execute sale deed in their favour.
                                                                             5

 


5.    Rukmani Ammal and her son contested the suit by asserting that the

Will executed by Ramakkal Ammal did not obligate them to sell the

property to the plaintiffs; that clause 11 of the Will was liable to be treated

as void because the same was against the rule against perpetuity and the law

of alienation; that Rukmani Ammal was in need of money for maintaining

herself and, therefore, her son gave up his right in the suit property

facilitating alienation thereof in favour of K. Naina Mohamed. They further

pleaded that before executing the sale deed, an offer was made to the

plaintiffs to purchase the suit property but they refused to do so.

 

6.    In a separate written statement filed by him, appellant - K. Naina

Mohamed pleaded that the Will did not provide for joint possession and

enjoyment of the properties by two sisters and that clause 11 of the Will

cannot be relied upon by the plaintiffs for claiming pre-emption. He also

questioned the legality of the restriction contained in clause 11 of the Will

on alienation of the property to the strangers by asserting that the said clause

violated the rule against perpetuity.
                                                                            6


7.    Respondent No.1 examined himself as P.W.1 and one Srinivasan as

P.W.2 and produced nine documents which were marked as Exhibits A1 to

A9. Rukmani Ammal and her son neither appeared in the witness box nor

produced any documentary evidence. Appellant K. Naina Mohamed

examined himself as D.W.1 and one Thangavel as D.W.2, but he did not

produce any document.

 

8.    The trial Court negatived the appellant's challenge to the Will by

observing that being a purchaser from one of the legatees, he does not have

the locus to question legality of the Will. The trial Court held that clause 11

is valid and binding on the legatees and it does not violate the rule against

perpetuity.   The trial Court further held that K. Naina Mohamed had

purchased the property with notice of the clause relating to pre-emption and

as such he is bound by the same.

 

9.    Rukmani Ammal and her son did not challenge the judgment and

decree of the trial Court but the appellant did so by filing an appeal. The

lower appellate Court agreed with the trial Court that the appellant before it

was not entitled to challenge the Will but opined that the restriction

contained in clause 11 of the Will was void and not binding on Rukmani
                                                                             7


Ammal and her son. The learned lower appellate Court referred to the

judgments of Allahabad and Oudh High Courts in Askar Begum v. Moula

Butch AIR 1923 All 381 and Doss Singh v. Gupchand AIR 1921 Oudh

125 and held that after creating absolute right in favour of male heirs of her

two sisters, the executant did not have the power to impose restriction on

alienation of their respective shares. The learned lower appellate Court also

referred to the judgment of this Court in Rukmanbai v. Shivaram AIR

1981 SC 1881 and held that the suit filed by two sons of Savithiri Ammal

was pre-mature.

 

10.   Respondent Nos.1 and 2 challenged the appellate decree in Second

Appeal No.360/1989. While admitting the appeal, the High Court framed

the following substantial question of law:

      "Whether the first appellate court is correct in holding that the
      restriction, namely the pre-emption clause in the Will is not
      valid?"


11.   The learned Single Judge analysed the pleadings and evidence of the

parties, referred to clauses 10 and 11 of the Will and held that the restriction

contained therein does not violate the rule against perpetuity.    He rejected

the appellants' plea that right of pre-emption was not available to respondent
                                                                         8


Nos.1 and 2 against Rukmani Ammal and restored the decree passed by the

trial Court.

 

12.    Shri S. Balakrishnan, learned senior counsel appearing for the

appellant made three fold arguments. Learned senior counsel pointed out

that Rukmani Ammal and her son, A.B.M. Ramanathan Chettiar died during

the pendency of the second appeal before the High Court and argued that the

same stood automatically abated because legal representatives of the

deceased were not brought on record. Shri Balakrishnan relied upon the

judgments of this Court in State of Punjab v. Nathu Ram AIR 1962 SC 89,

Deokuer and another v. Sheoprasad Singh and others AIR 1966 SC 359,

Madan Naik v. Hansubala Devi AIR 1983 SC 676, Amar Singh v. Lal

Singh (1997) 11 SCC 570, Amba Bai v. Gopal (2001) 5 SCC 570 and

Umrao v. Kapuria AIR 1930 Lahore 651 and argued that the High Court

committed serious error by granting relief to respondent Nos.1 and 2 without

insisting on the impleadment of the legal representatives of Rukmani Ammal

and her son, A.B.M. Ramanathan Chettiar. Learned senior counsel further

argued that the restriction contained in clause 11 on alienation of the

property was to operate only within the respective branches and it was not

obligatory for the male heirs of one branch to sell the property to the male
                                                                            9


heirs of the other branch. An alternative argument made by learned senior

counsel is that the restriction contained in clause 11 of the Will against

alienation of the property is ex facie violative of the rule against perpetuity

and the trial Court and the High Court committed serious error by relying

upon the same for the purpose of nullifying the sale deed executed by

Rukmani Ammal and her son A.B.M. Ramanathan Chettiar.                 The last

argument of the learned senior counsel is that in view of the compromise

arrived at between the parties in OS No.473 of 1981, Rukmani Ammal and

her son became absolute owner of `B' property and their rights cannot be

regulated or restricted by the conditions enshrined in the Will.

 

13.   Shri R. Sundaravaradhan, learned senior counsel appearing for the

respondents supported the impugned judgment and argued that the appellant

is not entitled to seek a declaration that the second appeal filed by

respondent Nos.1 and 2 stood abated on account of non-impleadment of the

legal representatives of Rukmani Ammal and her son, who died during the

pendency thereof. Learned senior counsel submitted that rules contained in

Order XXII of the Code of Civil Procedure are required to be interpreted

liberally so as to avoid abatement of the pending matters. He then argued

that the second appeal did not abate on account of death of Rukmani
                                                                             10


Ammal and her son, A.B.M. Ramanathan Chettiar because in terms of the

Will executed by Smt. Ramakkal Ammal, Rukmani Ammal got life interest

only and her son, who became absolute owner neither challenged the decree

passed by the trial Court nor contested the second appeal. Learned counsel

then referred to the definition of term `legal representatives' contained in

Section 2(11) of the Code of Civil Procedure and argued that the appellant,

who had purchased the suit property will be deemed to be legal

representative of the deceased because he represented their estate.          In

support of this argument, Shri Sundaravaradhan relied upon the judgments

of this Court in Mohd. Arif v. Allah Rabbul Alamin AIR 1982 SC 948 and

Ghafoor Ahmad Khan v. Bashir Ahmed Khan AIR 1983 SC 123.

Learned senior counsel submitted that the restriction contained in clause 11

of the Will was not absolute inasmuch as it was open to the male heirs of

Savithiri Ammal and Rukmani Ammal to transfer the property within the

family. Learned counsel placed strong reliance on the judgments of the

Privy Council in Mohammad Raza and others v. Mt. Abbas Bandi Bibi

AIR 1932 PC 158 and of this Court in Ram Baran Prasad v. Ram Mohit

Hazra AIR 1967 SC 744 and Zila Singh v. Hazari AIR 1979 SC 1066 and

emphasized that the object of the restriction on alienation of the properties to

strangers was to protect the interest of the family and there was no violation
                                                                          11


of the rule against perpetuity.

 

14.   We have considered the respective submissions and perused the

records. We shall first deal with the question whether the second appeal

filed by respondent Nos.1 and 2 stood abated due to their alleged failure to

bring on record the legal representatives of Rukmani Ammal and her son

A.B.M. Ramanathan Chettiar, who died on 23.6.1989 and 21.6.1995

respectively i.e. much before the disposal of the second appeal. A reading of

the judgment under challenge shows that neither the factum of death of

Rukmani Ammal and her son was brought to the notice of the learned Judge

who decided the appeal nor any argument was made before him that the

second appeal will be deemed to have abated on account of non

impleadment of the legal representatives of the deceased. The reason for

this appears to be that Rukmani Ammal and her son A.B.M. Ramanathan

Chettiar, who had also signed the sale deed as one of the vendors did not

challenge the judgment and decree of the trial Court and only the appellant

had questioned the same by filing an appeal. A.B.M. Ramanathan Chettiar

did not even contest the second appeal preferred by respondent Nos.1 and 2.

Before this Court, the issue of abatement has been raised but the memo of

appeal is conspicuously silent whether such a plea was raised and argued
                                                                           12


before the High Court. Therefore, we do not think that the appellant can be

allowed to raise this plea for frustrating the right of respondent Nos.1 and 2

to question alienation of the suit property in violation of the restriction

contained in clause 11 of the Will. Here, it is necessary to mention that by

virtue of the Will executed by her sister, Rukmani Ammal got only life

interest in the property of the testator and her male heir, A.B.M. Ramanathan

Chettiar got absolute right after her death. Therefore, during her life time,

Rukmani Ammal could not have sold the property by herself. This is the

precise reason why she joined her son in executing the sale deed in favour of

the appellant. If an objection had been taken before the High Court that

legal representatives of A.B.M. Ramanathan Chettiar have not been brought

on record, an order could have been passed under Rule 4 of Order XXII

which reads as under:

      "The Court whenever it thinks fit, may exempt the plaintiff
      from the necessity of substituting the legal representatives of
      any such defendant who has failed to file a written statement or
      who, having filed it, has failed to appear and contest the suit at
      the hearing; and judgment may, in such case, be pronounced
      against the said defendant notwithstanding the death of such
      defendant and shall have the same force and effect as if it has
      been pronounced before death took place."


15.   The definition of the term `legal representative' contained in Section

2(11) of the Code of Civil Procedure also supports the argument of the
                                                                              13


learned counsel for the respondents that the second appeal cannot be treated

as having abated because the appellant who had purchased the property was

representing the estate of the deceased. In Mohd. Arif v. Allah Rabbul

Alamin (supra), this Court considered a somewhat similar issue and held as

under:

         "It is true that the appellant did not prefer any appeal to the
         District Court against the original decree but in the first appeal
         he was a party respondent. But that apart, in the second appeal
         itself Mohammad Arif had joined as co-appellant along with his
         vendor, Mohammad Ahmed. On the death of Mohammad
         Ahmed all that was required to be done was that the appellant
         who was on record should have been shown as a legal
         representative inasmuch as he was the transferee of the property
         in question and at least as an intermeddler was entitled to be
         treated as legal representative of Mohammad Ahmed. He being
         on record the estate of the deceased appellant qua the property
         in question was represented and there was no necessity for
         application for bringing the legal representatives of the
         deceased appellant on record. The appeal in the circumstances
         could not be regarded as having abated and Mohammad Arif
         was entitled to prosecute the appeal."
                                                      (emphasis supplied)

         In Ghafoor Ahmad Khan v. Bashir Ahmed Khan (supra), this

Court reversed the order of Allahabad High Court which had dismissed the

second appeal preferred by the appellant as having abated on the ground of

non-impleadment of the heirs of the sole respondent by observing that

during his life time, the respondent had transferred the property (subject
                                                                          14


matter of appeal) to his wife by way of gift and as such the case would fall

under Order XXII Rule 10 CPC.

 

      Reference may also be made to the Division Bench judgment of

Calcutta High Court in Haradhone v. Panchanan AIR 1943 Calcutta 570.

That was a case under Bengal Tenancy Act, 1885. The proprietor of the

land, Sir Bejoy Chand Mehtab filed suit for settlement of rent in respect of

the tenure.   The defendants contested the suit by saying that the lands

constituted their niskar holding and that the same were wrongly recorded as

liable to be assessed to rent under the plaintiff. The Assistant Settlement

Officer decreed the plaintiff's claim. He held that the tenancy was not a

niskar one and it was liable to be assessed to rent. Learned special Judge,

who heard the appeal preferred by the defendants' confirmed the finding

recorded by the Assistant Settlement Officer on the issue of nature of the

property but set aside the decree so far as it settled the amount of rent and

remanded the case to the Assistant Settlement Officer. Learned special

Judge also held that the defendants were no longer in possession of the suit

land. The defendants challenged the appellate judgment by filing an appeal

before the High Court. During the pendency of the appeal, the plaintiff

granted a putni, which included the suit lands to Panchanan Palit. The
                                                                             15


putnidar applied for impleadment as a party in the appeal and his prayer was

granted. Thereafter, the original plaintiff died, but no substitution was made

in his place. It was argued before the High Court that the appeal abated

against the plaintiff because his legal representatives were not brought on

record. The Division Bench of the High Court held that after giving up the

estate in a permanent putni lease, the proprietor of the estate ceased to be the

landlord of all subordinate tenures and he did not have the right to institute a

proceeding under Section 105 of the Act. The High Court then referred to

Order XXII Rules 2 and 10 and held as under:

      "The position of the parties after the creation of the putni in this
      case therefore became as follows: (1) The putni having been
      created pendente lite the defendants-appellants were entitled to
      prosecute their appeal as against the plaintiff Maharaja alone
      ignoring the transfer pendente lite; the transferee pendente lite
      would have have been bound by the ultimate result of the
      litigation. (2) The defendants-appellants were entitled also to
      bring on record the transferee pendente lite under Order 22,
      R.10, Civil P.C., in the place of the Maharaja plaintiff-
      respondent; (3) Had the proceedings been instituted after the
      creation of the putni, the Maharaja plaintiff would not have
      been competent to institute the proceeding under S. 105 of the
      Act. This shows that the interest of the plaintiff involved in the
      suit came to or devolved upon the holder of the putni within the
      meaning of O. 22, rule 10, C.P.C, (4) The relief awarded by the
      decree appealed from was that the tenancy was not a rent free
      one but was liable to assessment of rent; and this being the
      nature of the relief involved in the appeal, it was the immediate
      landlord having permanent interest who was vitally concerned
      with it, and not the superior landlord who had permanently
      leased out his interest. In our opinion, therefore, the right to
      appeal survived the deceased plaintiff and it did survive against
                                                                           16


      the putnidar respondent alone within the meaning of order 22,
      rule 2, C.P.C. We, therefore, hold that the appeal is competent
      without the legal representative of the deceased Maharaja being
      brought on the record."
                                              (emphasis supplied)


      The judgments on which reliance has been placed by Shri

Balakrishnan are clearly distinguishable. In State of Punjab v. Nathu Ram

(supra), this Court held that where the appeal preferred by the State

Government against an award passed by the arbitrator under the Land

Acquisition Act in favour of two brothers stood abated against one brother

on account of non-impleadment of his legal representatives, the same did not

survive against the other brother because the award was joint and indivisible.

After taking note of the provisions contained in Order XXII Rule 4 and

Order I Rule 9, the Court observed:

      "(6) The question whether a Court can deal with such matters
      or not, will depend on the facts of each case and therefore no
      exhaustive statement can be made about the circumstances
      when this is possible or is not possible. It may, however, be
      stated that ordinarily the considerations which weigh with the
      Court in deciding upon this question are whether the appeal
      between the appellants and the respondents other than the
      deceased can be said to be properly constituted or can be said to
      have all the necessary parties for the decision of the controversy
      before the Court. The test to determine this has been described
      in diverse forms. Courts will not proceed with an appeal (a)
      when the success of the appeal may lead to the Court's coming
      to a decision which be in conflict with the decision between the
      appellant and the deceased respondent and therefore which
      would lead to the Court's passing a decree which will be
                                                                          17


      contradictory to the decree which had become final with respect
      to the same subject-matter between the appellant and the
      deceased respondent; (b) when the appellant could not have
      brought the action for the necessary relief against those
      respondents alone who are still before the Court and (c) when
      the decree against the surviving respondents, if the appeal
      succeeds, be ineffective, that is to say, it could not be
      successfully executed."


      In Madan Naik v. Hansubala Devi (supra), this Court was called

upon to consider the correctness of an order passed by the learned Single

Judge of Patna High Court who set aside dismissal of an application made

by the appellant in the matter of abatement of the appeal and remitted the

matter to the lower appellate Court for disposal of the appeal on merits.

While approving the order of the learned Single Judge, this Court referred to

Order XXII Rules 4 and 11 CPC and observed:

      "Order 22 Rule 11 of the Code of Civil Procedure read with
      Order 22 Rule 4 makes it obligatory to seek substitution of the
      heirs and legal representatives of deceased respondent if the
      right to sue survives. Such substitution has to be sought within
      the time prescribed by law of limitation. If no such substitution
      is sought the appeal will abate. Sub-rule (2) of Rule 9 of Order
      22 enables the party who is under an obligation to seek
      substitution to apply for an order to set aside the abatement and
      if it is proved that he was prevented by any sufficient cause
      from continuing the suit which would include an appeal, the
      court shall set aside the abatement. Now where an application
      for setting aside an abatement is made, but the court having not
      been satisfied that the party seeking setting aside of abatement
      was prevented by sufficient cause from continuing the appeal,
      the court may decline to set aside the abatement. Then the net
                                                                           18


      result would be that the appeal would stand disposed of as
      having abated. It may be mentioned that no specific order for
      abatement of a proceeding under one or the other provision of
      Order 22 is envisaged; the abatement takes place on its own
      force by passage of time. In fact, a specific order is necessary
      under Order 22 Rule 9 CPC for setting aside the abatement."


      In Amba Bai v. Gopal (supra), this Court considered whether non

impleadment of the legal representatives of the defendant in a suit for

specific performance was sufficient to deny them right to contest the matter

at the stage of execution. The facts of that case were that the suit filed by

Laxmi Lal for specific performance against one Radhu Lal was dismissed by

the trial Court but was decreed by the appellate Court. During the pendency

of the second appeal preferred by Radhu Lal, plaintiff Laxmi Lal died and

his legal representatives were brought on record.        However, the legal

representatives of Radhu Lal who too died before the dismissal of the appeal

were not brought on record and this fact was not brought to the notice of the

High Court. When the legal representatives of Laxmi Lal filed execution

case against the legal representatives of Radhu Lal, an objection was raised

on the latter's behalf that the judgment rendered by the High Court was

nullity. The trial Court rejected the objection. The revision preferred by the

legal representatives of Radhu Lal was allowed by the High Court and it was

held that the decree passed in the second appeal was a nullity as it had been
                                                                           19


passed against a dead person. The High Court accepted the theory of merger

and ruled that the execution proceedings were liable to be dismissed. This

Court reversed the order of the High Court and held:

      "In the instant case, there is no question of the application of
      the doctrine of merger. As the second appellant Radhu Lal died
      during the pendency of the appeal, and in the absence of his
      legal heirs having taken any steps to prosecute the second
      appeal, the decree passed by the first appellate court must be
      deemed to have become final. By virtue of the order passed by
      the first appellate court, the plaintiff's suit for specific
      performance was decreed. Failure on the part of the legal heirs
      of Radhu Lal to get themselves impleaded in the second appeal
      and pursue the matter further shall not adversely affect the
      plaintiff decree-holder as it would be against the mandate of
      Rule 9 Order 22 of the Code of Civil Procedure. The impugned
      order is, therefore, not sustainable in law and the same is set
      aside and the appeal is allowed. The executing court may
      proceed with the execution proceedings."


      In Amar Singh v. Lal Singh (supra), this Court held that where more

than one person was entitled to property covered under the Will, the relief is

joint and inseparable and if the appeal stood abated against the first

respondent, the same shall stand abated against the remaining respondents as

well. In Umrao v. Kapuria (supra), the learned Single Judge of Lahore

High Court held that where legal representatives of the successful plaintiff

were not brought on record, the whole appeal stood abated.
                                                                           20


16.   In none of the aforementioned cases, a question similar to the one

raised in this appeal was examined and decided. Therefore, the proposition

laid down therein cannot be made basis for declaring that the second appeal

preferred by respondent Nos.1 and 2 stood automatically abated due to non-

impleadment of the legal representatives of Rukmani Ammal and her son,

A.B.M. Ramanathan Chettiar, despite the fact that the appellant, who

represented the estate of the deceased in his capacity as a purchaser had not

only challenged the judgment of the trial Court by filing an appeal but also

contested the second appeal.

 

17.   The next issue which needs consideration is whether the restriction

enshrined in clause 11 of the Will executed by Ramakkal Amal can be

declared as void on the ground that it violates the rule against perpetuity.

This rule has its origin in the Duke of Norfolk's case of 1682. That case

concerned Henry, 22nd Earl of Arundel, who had tried to create a shifting

executory limitation so that one of his titles would pass to his eldest son

(who was mentally deficient) and then to his second son, and another title

would pass to his second son, but then to his fourth son. The estate plan also

included provisions for shifting the titles many generations later, if certain

conditions were to occur. When the second son, Henry, succeeded to one
                                                                            21


title, he did not want to pass the other to his younger brother, Charles. The

latter sued to enforce his interest. The House of Lords held that such a

shifting condition could not exist indefinitely and that tying up property too

long beyond the lives of people living at the time was wrong. In England,

the rule against perpetuity was codified in the form of the Perpetuities and

Accumulations Act, 1964 and in the latest report of the British Law

Commission,      a     new     legislation     has    been      recommended.

(http://www.lawcom.gov.uk)

 

18.    In India, the rule against perpetuity has been incorporated in Section

114 of the Indian Succession Act, 1925 which reads thus:

      "114. Rule against perpetuity.- No bequest is valid whereby
      the vesting of the thing bequeathed may be delayed beyond the
      life-time of one or more persons living at the testator's death
      and the minority of some person who shall be in existence at
      the expiration of that period, and to whom, if he attains full age,
      the thing bequeathed is to belong."


      However, as will be seen hereinafter, the principle enshrined in the

aforesaid section does not have any bearing on this case.

 

19.   In Ram Baran Prasad v. Ram Mohit Hazra (supra), this Court

considered whether covenant of pre-emption contained in an arbitration
                                                                            22


award violates the rule against perpetuity and whether the same is binding

on assignees or successor-in-interest of the original contracting parties. The

factual matrix of that case was that two brothers, Tulshidas Chatterjee and

Kishorilal Chatterjee owned certain properties in the suburbs of Calcutta. In

1938, Kishorilal sued for partition of the properties. The matter was referred

to arbitration. The arbitrators gave award, which was made rule of the court.

Under the award, two of the four blocks into which the properties were

divided by the arbitrators were allotted to Tulshidas and the remaining two

blocks to Kishorilal. In the award there was a clause to the following effect:

      "We further find and report with the consent of and approval of
      the parties that any party in case of disposing or transferring
      any portion of his share, shall offer preference to the other
      party, that is each party shall have the right of pre-emption
      between each other."

After the arbitration award became rule of the court, Tulshidas sold some of

the portion of his properties to Nagendra Nath Ghosh. This was done after

Kishorilal refused to pre-empt the same. Later on, Kishorilal sold his two

blocks to Rati Raman Mukherjee and others. The Mukherjees sold the

property to the plaintiff-respondents. Nagendra Nath also sold the property

to defendant No.1. Thereupon, the plaintiffs filed suit for pre-empting the

transaction between Nagendra Nath Ghosh and defendant No.1. The trial

Court held that the covenant of pre-emption was not hit by the rule against
                                                                            23


perpetuities and was enforceable against the assignees of the original parties

to the contract. Accordingly, a decree was granted to the plaintiffs. The

defendants took the matter in appeal to the Calcutta High Court which was

dismissed.   Before this Court, it was argued that the covenant for pre-

emption was merely a personal covenant between the contracting parties and

was not binding against successors-in-interest or the assignees of the original

parties to the contract. While rejecting the argument, the Court referred to

various clauses of the award and observed:

      "It is obvious that in these clauses expression "parties" cannot
      be restricted to the original parties to the contract but must
      include the legal representatives and assignees of the original
      parties and there is no reason why the same expression should
      be given a restricted meaning in the pre-emption clause."

 

      The Court then considered whether covenant of pre-emption offends

the rule against perpetuities and is, therefore, void and not enforceable.

After noticing the definition of "perpetuity" given by Lewis, the Court held

that the rule against perpetuity concerns rights of property only and does not

affect the making of contracts which do not create interest in property. The

Court then referred to Sections 14 and 54 of the Transfer of Property Act

and observed as under:

      "The rule against perpetuity which applies to equitable estates
      in English law cannot be applied to a covenant of pre-emption
                                                                              24


        because Section 40 of the statute does not make the covenant
        enforceable against the assignee on the footing that it creates an
        interest in the land."

 

        The Court further held that the covenant of pre-emption was not

violative of the rule against perpetuity and could not be declared as void.

 

        The same view was reiterated in Shivji v. Raghunath (1997) 10 SCC

309. In that case, the Court found that the restriction contained against

alienation of the property was not absolute and held that the same was not

violative of the rule against perpetuity.      After noticing the ratio of the

judgment in Ram Baran Prasad v. Ram Mohit Hazra (supra), the Court

held:

          ".........when a contract has been executed in which no
        interest in praesenti has been created, the rule of perpetuity has
        no application. As a result, the agreement is in the nature of a
        pre-emptive right created in favour of the co-owner. Therefore,
        it is enforceable as and when an attempt is made by the co-
        owner to alienate the land to third parties."


20.     Reverting to the case in hand, we find that by executing Will dated

22.9.1951, Smt. Ramakkal Ammal created life interest in favour of her two

sisters with a stipulation that after their death, their male heirs will acquire

absolute right in `A' and `B' properties respectively subject to the condition
                                                                             25


that if either of them want to sell the property then they shall have to sell it

to other sharers only as per the prevailing market value and not to strangers.

The restriction contained in clause 11 was not absolute inasmuch as

alienation was permitted among male heirs of the two sisters. The object of

incorporating this restriction was to ensure that the property does not go out

of the families of the two sisters. The male heirs of Savithri Ammal and

Rukmani Ammal did not question the conditional conferment upon them of

title of the properties. Therefore, the appellant who purchased `B' property

in violation of the aforesaid condition cannot be heard to say that the

restriction contained in clause 11 of the Will should be treated as void

because it violates the rule against perpetuity.

 

21.   In re. MACLEAY 1875 M. 75, a similar question was considered and

answered in negative. The facts of that case were Margarette Mayers, by her

will, after a gift to her brother Henry on condition that he settled it on his

wife and children, and the gift of a like sum to his sisters, made the

following devise:-

      "I give to my dear brother John the whole of the property given
      to me by my dear aunt Clara Perkins, consisting of the manor of
      Bletchingley, in the county of Surrey, and the Pendell Court
      Mansion, with the land belonging to it, on the condition that he
      never sells it out of the family."
                                                                          26


The testatrix then gave legacies to her nephews and nieces named in the

Will, and after a legacy to a servant, gave the residue of her estate and

effects to her "dear brothers" and "dear sisters." John Perkins Mayers, the

devisee under the Will contracted with Sir George Macleay for the sale to

him of the property comprised in the devise, with a proviso that the

intending purchaser should be at liberty to apply for registration of the

hereditaments in the Office of Land Registry, and that in the event of its

being found impossible to obtain such registration, the contract should be

void. In the course of investigation of the title, a doubt arose whether in

view of the condition enshrined in the Will, a marketable title existed in

favour of the vendor. The Registrar made a reference to the Court under

Section 6 of the Transfer of Land Act. It was suggested that the restriction

contained in the Will was void being repugnant to the quality of the estate.

Sir G. Jessel, M.R. referred to several earlier judgments and observed:

      "The law on the subject is very old, and I do not think it can be
      better stated that it is in Coke upon Littleton, in Sheppard's
      Touchstone, and other books of that kind, which treat it in the
      same way. Littleton says (1): "If a feoffment be made upon this
      condition, that the feoffee shall not alien the land to any, this
      condition is void, because when a man is enfeoffed of lands or
      tenements he hath power to alien them to any person by the
      law. For if such a condition should be good, then the condition
      should oust him of all the power which the law gives him,
      which should be against reason, and therefore such a condition
      is void." Then he says (2): "But if the condition be such that
      the feoffee shall not alien to such a one, naming his name, or to
                                                                       27


any of his heirs or of the issues of such a one, or the like, which
conditions do not take away all power of alienation from the
feoffee, then such condition is good." So that, according to
Littleton, the test is, does it take away all power of alienation? I
think it is fair to make one remark, which is made in the case of
Muschamp v. Bluet (3), cited in Jarman on Wills (4), and
adopted by Lord Romilly in the case I am going to refer to, of
Attwater v. Attwater (5) - that it must not, in fact, take away all
power, because, if you say that he shall not alien except to A.
B., who you know will not or cannot purchase, that would be in
effect restraining him from all alienation, and, as is very well
said in many cases, and is said in a passage in Coke to which I
am about to refer, you cannot do that indirectly which you can
do directly. I had occasion to refer, in the case of Jacobs v.
Brett (6), to a practice which was said to prevail in the Court of
Common Pleas, and where I said it never could have been
considered by that Court as being intended as the infringement
of so salutary a rule. The condition, therefore, whatever it may
be must not really take away all power, either by express words
or by the indirect effect of the frame of the condition. That is
the effect of the rule as laid down by Littleton. Then Coke says
(1): "If a feoffment in fee be made upon condition that the
feoffee shall not infeoff J. S. or any of his heirs, or issues, & e.
this is good, for he doth not restrain the feoffee of all his power:
the reason here yielded by our author is worthy of observation.
An in this case, if the feoffee infeoof J. N. of intent and purpose
that he shall infeoof J. S., some hold that this is a breach of the
condition, for quando aliquid prohibetur fieri, ex director
prohibetur et per obliquum." That was Coke's notion: and I
hope it has not altogether departed from our Courts. Then he
says: "If a feoffment be made upon condition that the feoffee
shall not alien in mortmain, this is good, because such
alienation is prohibited by law, and regularly whatsoever is
prohibited by the law may be prohibited by condition, be it
malum prohibitum or malum in se," and there he stops.

      So that, according to the old books, Sheppard's
Touchstone being to the same effect, the test is whether the
condition takes away the whole power of alienation
                                                                         28


substantially: it is a question of substance, and not of mere
form.

       Now, you may restrict alienation in many ways. You
may restrict alienation by prohibiting a particular class of
alienation, or you may restrict alienation by prohibiting a
particular class of individuals, or you may restrict alienation by
restricting it to a particular time. In all those ways you may
limit it, and it appears to me that in two ways, at all events, this
condition is limited. First, it is limited as to the mode of
alienation, because the only prohibition is against selling.
There are various modes of alienation besides sale; a person
may lease, or he may mortgage, or he may settle; therefore it is
a mere limited restriction on alienation in that way. Then,
again, it is limited as regards class; he is never to sell it out of
the family, but he may sell it to any one member of the family.
It is not, therefore, limited in the sense of there being only one
persons to buy; the will shews there were a great many
members of the family when she made her will; a great many
are named in it; therefore you have a class which probably was
large, and was certainly not small. Then it is not, strictly
speaking, limited as to time, except in this way, that it is limited
to the life of the first tenant in tail; of course, if unlimited as to
time, it would be void for remoteness under another rule. So
that this is strictly a limited restrain on alienation, and unless
Coke upon Littleton has been overruled or is not good law, this
is a good condition.

       It is said that the very point occurred in Doe v. Pearson
(1) and Attwater v. Attwater (2), and it appears to me that the
point did occur in both those cases. In Doe v. Pearson the gift
was a gift in fee upon this special proviso and conditions, "that
in case my said daughters Ann and Hannah Collett, or either of
them, shall have no lawful issue, that then and in such case,
they and she having no lawful issue as aforesaid shall have no
power to dispose of her share in the said estates so above given
to them, except to her sister or sisters, or to their children."
Here it is "family", which is a larger term. In the next place,
here it is "sell" only, there it was "dispose", which is probably
the largest term known to the law. So that the power of
                                                                      29


alienation was very much more restricted in Doe v. Pearson
than it is in the case before me. But the full Court there held,
after a very long and elaborate argument, Lord Ellenborough
giving judgment and going into the authorities very carefully,
that the condition was good; and he says (3): "As to the first,
we think the condition is good; for, according to the case of
Daniel v. Ubley (4), though the Judges did not agree as to the
effect of a devise", and so forth, "yet in that case it was not
doubted but that she might have had given her a fee simple
conditional to convey it to any of the sons of the devisor; and if
she did not, that the heir might enter for the condition broken."
Now that is a stronger case still; because, as Lord Ellenborough
and the other Judges of the Queen's Bench read Daniel v.
Ubley (1), all the Judges agreed, n the time of Sir W. Jones, that
it was good to give a woman a fee simple with a condition to
convey it to one of the sons of the devisor; that is, she could not
convey it to anybody else; it was limited. There Mr. Justice
Doderidge said (2) "He conceived she had the fee, with
condition, that if she did alien, that then she should alien to one
of the children," which is a very limited class; and he finally
concluded by saying that "her estate was a fee with a liberty to
alienate it if she would, but with a condition that if she did
alienate, the she should alienate to one of her sons." So that the
case of Daniel v. Ubley is also stronger than the present. In the
first place, it was a prohibition, not merely against selling, but
against all alienation; and in the next place, the class was
limited to one of the sons of the devisor; but yet the Judges
gave an opinion that it would be good, and following that old
authority, Lord Ellenborough and the Judges of the Queen's
Bench, in Doe v. Pearson (3), in the year 1805, held that the
condition was valid.

       Now taking that altogether, seeing that he has no quarrel
with Doe v. Pearson (2), seeing that he takes it that Coke's
assertion is good law, the key to that judgment must be found in
the latter observations, where he says: "It appears to me, also,
that this is the true construction of the words used by the
testator; it is, in truth, an injunction never to sell the
hereditaments devised at all. The words `out of the family' are
merely descriptive of the effect of the sale;" and, so read, it
                                                                           30


      does not conflict with the older authorities to which I have had
      occasion to refer. I must consider that case, recognizing, as it
      does, those older authorities as being good law, to have
      proceeded on the particular wording of that will, and more
      especially on the latter clause. I do not say that the clause does
      have the same effect on my mind that it had upon the mind of
      my predecessor; but still it is useless to criticize a question of
      construction when you come to the conclusion that the Judge is
      intending not to lay down a new rule of law, but is simply
      construing the particular instrument before him.

            Therefore, I consider that the case of Attwater v.
      Attwater (3) does not affect the law of the case, and that this
      being a limited restriction upon alienation, the condition is
      good."
                                                 (emphasis supplied)

 

22.   In Mohammad Raza and others v. Mt. Abbas Bandi Bibi (supra),

the Privy Council confirmed the judgment of the Chief Court of Oudh which

had ruled that when a person is allowed to take property under a conditional

family arrangement, he cannot be heard to complain against the restriction

on alienation of the property outside the family. The appellant before the

Privy Council was a purchaser of the property belonging to Smt. Sughra

Bibi which she got in furtherance of compromise arrived at between the

parties in a suit brought against her cousin. The Privy Council held that

even though it may not be possible to hold that Sughra Bibi took nothing

more than a life estate, the restriction against alienation to strangers was

valid. The relevant portions of that judgment are extracted below:
                                                                     31

 

"............But assuming in the appellants' favour that she took
an estate of inheritance, it was nevertheless one saddled, under
the express words of the document, with a restriction against
alienation to "a stranger". Their Lordships have no doubt that
"stranger" means anyone who is not a member of the family,
and the appellants are admittedly strangers in this sense. Unless
therefore this restriction can for some reason be disregarded,
they have no title to the properties which can prevail against the
respondent.

On the assumption that Sughra Bibi took under the terms of the
document in question an absolute estate subject only to this
restriction, their Lordships think that the restriction was not
absolute but partial; it forbids only alienation to strangers,
leaving her free to make any transfer she pleases within the
ambit of the family. The question therefore is whether such a
partial restriction on alienation is so inconsistent with an
otherwise absolute estate that it must be regarded as repugnant
and merely void. On this question their Lordships think that
Raghunath Prasad Singh's case (1) is of no assistance to the
appellants, for there the restriction against alienation was
absolute and was attached to a gift by will. It is in their
Lordships' opinion, important in the present case to bear in
mind that the document under which the appellants claim was
not a deed of gift, or a conveyance, by one of the parties to the
other, but was in the nature of a contract between them as to the
terms upon which the ladies were to take. The title to that
which Sughra Bibi took was in dispute between her and Afzal
Husain. In compromise of their conflicting claims what was
evidently a family arrangement was come to, by which it was
agreed that she should take what she claimed upon certain
conditions. One of these conditions was that she would not
alienate the property outside the family. Their Lordships are
asked by the appellants to say that this condition was not
binding upon her, and that what she took she was free to
transfer to them.

The law by which this question must be judged is their
Lordships think prescribed by S.3, Oudh Laws Act, 1876, and
                                                                            32


      failing the earlier clauses of the section which seem to have no
      application, "the Courts shall act according to justice, equity
      and good conscience," which has been adopted as the ultimate
      test for all the provincial Courts in India. Is it then contrary to
      justice, equity and good conscience to hold an agreement of this
      nature to be binding? Judging the matter upon abstract
      grounds, their Lordships would have thought that where a
      person had been allowed to take property upon the express
      agreement that it shall not be alienated outside the family, those
      who seek to make title, through a direct breach of this
      agreement, could hardly support their claim by an appeal to
      those high sounding principles and it must be remembered in
      this connection that family arrangements are specially favoured
      in Courts of equity. But apart from this it seems clear that after
      the passing of the Transfer of Property Act in 1882, a partial
      restriction upon the power of disposition would not, in the case
      of a transfer inter vivos, be regarded as repugnant: see S.10 of
      the Act. In view of the terms of this section, and in the absence
      of any authority suggesting that before the Act a different
      principle was applied by the Courts in India, their Lordships
      think that it would be impossible for them to assert that such an
      agreement as they are now considering was contrary to justice,
      equity and good conscience."
                                                     (emphasis supplied)

 

23.   We may now notice two judgments in which the nature of the right of

pre-emption has been considered. In Bishan Singh v. Khazan Singh AIR

1958 SC 838, this Court while interpreting the provisions of Punjab Pre-

Emption Act, 1913 referred to the judgment of Mahmood J., in Gobind

Dayal v. Inayatullah ILR 7 Allahabad 775 and summed up law relating to

right of pre-emption in the following words:
                                                                            33


       "(1) The right of pre-emption is not a right to the thing sold but
      a right to the offer of a thing about to be sold. This right is
      called the primary or inherent right. (2) The pre-emptor has a
      secondary right or a remedial right to follow the thing sold. (3)
      It is a right of substitution but not of re-purchase i.e., the pre-
      emptor takes the entire bargain and steps into the shoes of the
      original vendee. (4) It is a right to acquire the whole of the
      property sold and not a share of the property sold. (5)
      Preference being the essence of the right, the plaintiff must
      have a superior right to that of the vendee or the person
      substituted in his place. (6) The right being a very weak right, it
      can be defeated by all legitimate methods, such as the vendee
      allowing the claimant of a superior or equal right being
      substituted in his place."


24.   In Zila Singh v. Hazari (supra), this Court again considered the

nature of the right of pre-emption under the Punjab Act and observed:

      "................. The correct legal position is that the statutory
      law of pre-emption imposes a limitation or disability upon the
      ownership of a property to the extent that it restricts the owner's
      right of sale and compels him to sell the property to the person
      entitled to pre-emption under the statute. In other words, the
      statutory right of pre-emption though not amounting to an
      interest in the land is a right which attaches to the land and
      which can be enforced against a purchaser by the person
      entitled to pre-empt."

25.   In the light of the above, we shall now consider whether clause 11 of

the Will executed by Smt. Ramakkal Ammal is violative of the rule against

perpetuity. If that clause is read in conjunction with clauses 4 and 10 of the

Will, it becomes clear that two sisters of the testator, namely, Savithiri

Ammal and Rukmani Ammal were to enjoy house properties jointly during
                                                                            34


their life time without creating any encumbrance and after their death, their

male heirs were to get the absolute rights in `A' and `B' properties. The

male heirs of two sisters could alienate their respective shares to other

sharers on prevailing market value. It can thus be said that Smt. Ramakkal

Ammal had indirectly conferred a preferential right upon the male heirs of

her sisters to purchase the share of the male heir of either sisters. This was

in the nature of a right of pre-emption which could be enforced by male heir

of either sister in the event of sale of property by the male heir of other

sister. If the term `other sharers' used in clause 11 is interpreted keeping in

view the context in which it was used in the Will, there can be no manner of

doubt that it referred to male heirs of other sister. The only restriction

contained in clause 11 was on alienation of property to strangers. In our

view, the restriction which was meant to ensure that the property bequeathed

by Smt. Ramakkal Ammal does not go into the hands of third party was

perfectly valid and did not violate the rule against perpetuity evolved by the

English Courts or the one contained in Section 114 of the Indian Succession

Act, 1925.   As a corollary, we hold that the trial Court and the High Court

did not commit any error by relying upon clauses 10 and 11 of the Will for

granting relief to respondent Nos.1 and 2.
                                                                             35


26.   The argument of the learned counsel for the appellants that the

restriction enshrined in clause 11 was limited to the shares of the male heirs

of two sisters sounds attractive in the first blush but a careful and conjoint

reading of clauses 4, 10 and 11 makes it clear that the testator had intended

to prevent transfer of property to anyone other than the heirs of her two

sisters. In terms of clause 4, the two sisters were to enjoy the house property

jointly without encumbering the same during their lifetime. After their

death, the male heirs of Savithri Ammal were to get `A' property in equal

shares and male heirs of Rukmani Ammal were to get `B' property subject to

the condition specified in clause 11 which envisages that in case of

alienation, the male heirs of either sister had to sell the property to other

sharers as per the prevailing market value and not to strangers. Since the

intention of the testator was to impose a restriction on alienation of property,

clauses 10 and 11 cannot be interpreted in a manner which would permit

violation of that condition.

 

27.   We also do not find any substance in the argument of Shri

Balakrishnan that in view of the compromise decree passed in O.S.

No.473/1981, Rukmani Ammal became owner of the property in her own

right and respondent Nos.1 and 2 were not entitled to invoke the Will
                                                                                36


executed by Smt. Ramakkal Ammal for questioning the sale deed executed

in favour of the appellant. The record of the case does not show that any

such plea was raised in the written statement filed in O.S. No.226/1983.

From the impugned judgment it is not clear that any such argument was

raised before the High Court.     Therefore, it is extremely doubtful that

whether the appellant can be allowed to raise such a plea first time before

this Court. Moreover, for the reasons best known to him, the appellant did

not produce before the trial Court, copy of the compromise decree passed in

O.S. No.473/1981 and without going through the same it is not possible to

hold that Rukmani Ammal had acquired independent right to sell the suit

property to the appellant.

 

28.   In the result, the appeal is dismissed. However, the parties are left to

bear their own costs.


                                                   .............................J.
                                                   [G.S. Singhvi]

 

                                                   ..............................J.
                                                   [Asok Kumar Ganguly]

New Delhi
July 7, 2010.

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Succession Act, 1925 - s. 114 - Rule against perpetuity - Execution of Will - Life interest given to two sisters and after their death absolute rights given to their male heirs - Restriction in the Will that alienation of the property was permitte