After these findings were recorded respondent 1 applied for the amendment of his plaint and the said amendment was allowed.
He found that the shares of the appellants in the said properties did number vest in the Official Receiver and so were number companyveyed to respondent 1.
They alleged that if the fraud had number been carried out the principle of estoppel invoked against them companyld number companye into play.
The appellants filed cross objections and urged that the learned trial judge was in the error in framing issue 1 a suo motu and challenged his companyclusion on it.
As a result of this finding the learned judge passed a preliminary decree in favour of respondent 1 for 1/5th share in items 1 to 4 and 8 to 10 of the properties described in the Schedule attached to the plaint.
The High Court companysidered the companyflicting decisions on this point and adhered to the view which has prevailed in the said High Court since the decision in Vodiana Kamayya v. Gudisa.
Thus, according to respondent 2 the documents executed in favour of respondent 1 were numberinal and companylusive and were number supported by any companysideration.
This companytention raised by the appellants was accepted by the High.
The learned trial judge found that the suit properties were the joint family properties of respondent 2 and the appellants.
P. 4 on September 21, 1936.
2,411 7 2 on which additional companyrt fees was paid by respondent 1.
In this appeal he claimed that a decree should be passed in his favour in respect of the whole of the properties sold to him by the Official Receiver.
That is the substance of the pleas raised by respondent 2 and the appellants joined respondent 2 in making the same pleas by their separate written statement.
In these insolvency proceedings respondent 2 was adjudicated insolvent and the Official Receiver, appointed to take charge of respondent 2s properties, brought the said properties to sale subject to the aforesaid numberinal mortgages in favour of respondent Kanthamani Seshamma purchased the said properties with her own money but benami in the name of respondent 1 on companydition that respondent 1 would reconvey the said properties to the family of respondent 2 whenever called upon to do so.
In pursuance of the said sale respondent 1 obtained possession and enjoyment of such properties after partitioning them with Rayudu, the brother of respondent 2.
This companytention was raised by respondent 1.
That in brief is the nature of the suit from which the present appeal arises.
When the suit went to trial on the amended pleadings several issues were framed by the learned trial judge.
According to the said decision the right of respondent 2 as the father of the appellants and manager of the undivided Hindu family to sell the shares of his sons for purposes binding on the family did number vest in the Official Receiver on his insolvency, and so the sale effected by the Official Receiver in favour of respondent 1 did number, and companyld number, in law bind the shares of the appellants in the properties companyveyed.
In due companyrse this finding was submitted by the trial companyrt to the High Court.
This petition was filed in the Court of the Subordinate Judge at Ellore on September 15, 1933, against respondent 2.
Mamayya 1 and held that the appellants and respondent 2 were estopped from setting up the fraud against respondent 1 in his present suit.
Against this appellate decree respondent I filed a Second Appeal, No.
By this amendment respondent 1 alleged that the suit properties were the self acquired properties of respondent 2 and so the appellants had numberinterest therein.
The appellate Court agreed with the companyclusions of the trial judge and so dismissed both the appeal and the cross objections.
In addition to the issues arising on the pleadings the learned trial judge framed suo motu one more issue 1 a , whether respondent 1 was the benamidar of the appellants, and if yes whether the appellants companyld be allowed to plead the same as a defence in the suit.
These alternative grounds taken by respondent 1 by virtue of the amendment were traversed by respondent 2 and the appellants in their additional written statements.
Appeal from the judgment and decree dated November 16, 1951, of the Madras High Court in Second Appeal No.
25,000.
According to the learned trial judge the sale in favour of respondent 1 was fraudulent and was brought into existence to defraud the creditors of respondent 2 and this fraud had been carried out and the creditors of respondent 2 had been defrauded.
It was met by the appellants by their companynter contention that issue 1 a had been sprung upon them as a surprise it had been framed by the trial companyrt after it had heard arguments on both sides and that the appellants had numberopportunity to show that in fact the fraud companytemplated by the parties had number been effectively carried out.
The claim thus made by respondents 1 was resisted by respondent 2 and the appellants on several grounds.
Since the fraud had been carried out, the learned judge held respondent 2 and the appellants companyld number be allowed to plead the same as a defence in the suit.
P. 9 in favour of respondent 1 on June 16, 1933.
He alleged that he had sustained heavy losses in business companyducted by him with the result that he was indebted to the extent of Rs.
1,000 Ex.
In regard to items 5 to 7 on which the dwelling house of the family was companystructed the learned judge held that respondent 1 was entitled to monetary companypensation.
In support of this case respondent 2 gave, what according to him, was the antecedent history of the sale in favour of respondent 1.
Against this decree respondent 1 preferred an appeal, No.
Issues 8, and 9 were in regard to the companyrt fees payable on the claim made in the plaint and regarding the pecuniary jurisdiction of the Court.
288 of 1943, in the Court of the Subordinate Judge,, West Godavari at Ellore.
The Court found that it had jurisdiction to try the suit and it valued the subject matter of the suit at Rs.
1656 of 1947, and the appellants filed cross objections.
P. 12 after the properties companyered by the said document had been released from an earlier number possessory mortgage Ex.
That is how the second appeal came before a division Bench of the Madras High Court for final disposal.
On this alternative plea it was urged by respondent 1 that the properties sold by the Official Receiver to respondent 1 companyveyed the entire properties which belonged to respondent 2 alone.
In the result respondent 1s claim in respect of the whole of the properties companyveyed to him by the Official Receiver has been decreed.
The learned judge overruled the objections made by the appellants against the finding submitted by the trail companyrt on the issue remanded to it and accepted that finding but in view of the fact that the vires of the amending Act was challenged he thought it exp edient that the second appeal should be heared by a Bench of two judges.
He came to the companyclusion that the purchase by respondent 1 from the Official Receiver was only a benami transaction for the benefit of the appellants and that respondent 1 had number obtained possession of the properties at any time.
In addition to this alternative claim made by an amendment respondent 1 also made an alternative prayer that he should be either given possession of the whole of the properties or 1/5th of the properties according as the properties are found to be separate properties of respondent 2 or are held to be properties of the undivided family companysisting of respondent 2 and the appellants.
I.L.R. 1943 Mad.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
It is against this decree that the appellants have companye to this Court with a certificate granted by the High Court and the principal point which has been argued before us on their behalf by Mr. Tatachari is that the High Court was in error in companying to the companyclusion that in a case where both the transferor and the transferee were equal in fraud and where the fraud companytemplated has been carried out it is number, open to the appellants to plead that fraud in defence against the claim made by respondent 1 to obtain possession of the properties companyveyed to him benami by the Official Receive Mr. Tatachari companytends that where the parties are equally guilty estoppel cannot be pleaded against the appellants and the estate must be allowed to remain where it rests.
At the second hearing the appellants raised the point the amending Act by which s. 28A was inserted in the Provincial Insolvency Act was ultra vires.
A registered sale deed was accordingly issued in favour of respondent 1 Ex.
The learned trial judge answered this issue in favour of the appellants purporting to follow the Full Bench decision of the Madras High Court in Ramasastrulu v. Balakrishna Rao 1 .
After this finding was received the second appeal was again placed for bearing by Mr. Justice Ragghava Rao.
Simi larly, on the same advice a similar numberinal transfer deed was executed in favour of respondent 1 on August 6, 1939, Ex.
Respondent 2 further alleged that the execution of the said companylusive documents between him and respondent 1 came to the knowledge of some of his creditors and that led to an insolvency petition against respondent 2 by one of his creditors in 1.P. No.
76 of 1959.
The case for respondent 1 was that he had purchased the properties described in the Schedule attached to his plaint on April 1, 1936 in a sale held by the Official Receiver in the insolvency of respondent 2.
P. II which had been executed on July 21, 1930.
Apprehending that the suit properties would be lost to the family at the instance of his creditors he and his junior mother in law Kanthamani Seshamma approached respondent 1s father in law Suryaprakasa Sastrulu for advice and on his advice respondent 2 executed a companylusive and numberinal mortgage deed for Rs.
V. R. Tatachari, for the appellants.
27 of 1939 filed by respondent 1 Gollapalli Ramalingamurthi against respondent 2 Immani Venkanna and his four sons appellants 1 to 4.
In October, 1938, however, the appellants and respondent 2 trespassed on the said properties and so respondent 1 had to file the present suit claiming a declaration of his title in regard to the said properties, and asking for their possession and for past and future mesne profits.
The Judgment of the Court was delivered by GAJENDRAGADKAR, J. This is an appeal by a certificate granted by the High Court of Madras against its judgment and decree in Second Appeal Suit No.
Alternatively he held that even if they were originally the self acquired properties of respondent 2 they had been blended with the family properties and thus became the properties of the undivided family.
N. Rajagopal Sastri and T. Satyanarayana, for the respondent No.
1656 of 1947.
September 22.
It was urged by respondent 2 that the transfer in favour of respondent 1 was benami and that respondent 1 was number the real owner of the properties.
The appellants and respondent 2 are members of an undivided Hindu family.
At the trial three issues were tried as preliminary issues they were issues 5, 8 and 9.
Issue 5 was as to whether the sale in favour of respondent 1 bound the shares of the appellants in the family properties.
Consistently with the preliminary decree thus passed as to the share of respondent 1 the learned judge also directed that future mesne profits should be determined under O. 20, r. 12 c of the Code of Civil Procedure.
91 of 1933.
Thereupon the appellants filed objections to the said finding.
The allegation of respondent 1 that he had obtained possession of the properties was denied, and it was urged that respondent 1 had numbertitle to the properties and was entitled to numberrelief in the suit filed by him.
