# CllIDAMBARAIYER AND OTHERS v. P. S. RENGA IYER AND OTHERS

- **Citation:** [1966] 1 S.C.R. 168
- **Court:** Supreme Court of India
- **Decided:** 1965-05-06
- **Case number:** Civil Appeal No. 200 of 1963
- **Bench:** K. SliBBA R\O, Raghubar Dayal, R. S. Bkhawat
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/cllidambaraiyer-and-others-v-p-s-renga-iyer-and-others-3483
- **Pages:** 10

## Headnote

Madra.< Agriculturists Reliej Acr (Mad. Act IV of 1938), as amPnded
by Act XV of 1943 and Act XXXll of 1943. s. 9·A(l0l (ii) (bl-Mortgage debt not to be scaled down if mortgagee's right.'i transferred bona (ulc
for ''a/uable considcrarion-Transfer of
/l.fort;:agee's rights
to family
charity in lieu of sum earlier tfedicatl•d 10 the charity-Such transfer 'Whether for valuable cunsi<leration- wi1hin the meaning of proviso.
TI1c predecc'iwrs-in-intcrc<;t of the appellants executed in 1930 n registered mortgage deed (Ex.A-I) in favour of the respondent family for
Rs. 31,000. It v.·as a usufruc~uo.ry n1ortgagc
rcdccm~1ble aflcr 60 years.
The mortgagors filed a petition
under s. 9A and <. l 9A of the Madras
Agricultu1ists Relief Act for scaling do°""n the mort~age debt thereunder.
The moitgagccs raised a plea, inter alia, that the 1nortgage interest had
been transfcrr~ to a charity for valuable
con::<1idcration
and
therefore
a. 9A(IO)(ii)(b) of the Act was Ml attracted and hence the mortgage
debt wns oot liable to he scalc-0 down under the Act.
The pica was based
on document• Ex.II.[, Ex.B·2 and
Ex.B-3.
The learocd Subordinate
Judge, held that the transferee-the charity-not being a transferee for
valuable consideration s. 9A( lO)(i1) (b) did not arply. and on this fiodiog he r.caled down the mortga~e debt.
An appeal was filed by the mortgagees wherein the High Court held that the
transfer \Vas for valuahlc
consideration and therefore the debt
could
not be scaled down.
The
mortgagors ap~Jlcd to the Supreme Court with ccrtific;.;te.
HELD: (i) The agreement E"t;.R-1 executed bctv.ccn mcn1hcrs of the
mortgagee family sh~l'Ncd -that on August 22. 1934. the f~rnily created a
tn1st in respect of a sum of Rs. 36,988-9-8 for a charitable purposes. On
September 3, 1939, hy Ex.B-2. the usulructuary mo·tgagce right of the
family in Ex.A-I \VJS given to the charity in discharge of the obligation
under fa.B-1.
The dedication of the said property was affirmed by the
regular partition deed Ex.B-3.
In short under the said documenlo; the
family transferred to the charity their in!crest in the
usufructuary mortgage Ex.A-1 in d:scharge of the obligation to pay the trust a sum of
Rb. 36.988-9-8. 1174 E-GJ
(ii) It is implied in the dcfinit:on of th~ \vord 'consideration' in s. 2(d}
of the Contract .A.ct th:.it the consideration should
be 'something \\·hich
not only parti~s regard but the 1:1\\' can rc,c.~rd as having some value·. It
is apparent fror.1 tht' definition th;!t con..,id\!ration
m·1y he negative or
positive. [ 177 A-BJ
(iii) In th:: present case the family w:~s unJcr an obl;r,Jtion to pay to
the charity the amount scr ~part to it under Ex.B-1. l'he mortgage interest \Va.s transferred in dis;;::hargc of th:1t o1;i:gJtion.
That i-.; to say the
churHy agreed a·;
~1. consider.ttion f.:>r the lrailsfer of i.hc mortgage intere:;t
not to c::iforcr it:; right :o recover that amount from the family.
·rhc
charity gave up :h::t
ri~ht ~n consideration of
the
mortgage
interest
acquired by it.
Therefore it is clcaoth~t the family
transferred
the
mortgage interest in trust to the charity for valuable consideration \vith
lhc meaning of •· 9A(IO)(ii)(b) of the Act. [177 B-DJ
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CHIDAMBARAIYAR v. RENGA IYER (Subba Rao, J.)
169
It followed that the mortgage, Ex.A-I, was rightly held by the High
Com! not liable to be scalell down under the proviruons of the Act.
[1770]

## Text

168
CllIDAMBARAIYER AND OTHERS
v.
P. S. RENGA IYER AND OTHERS
May 6, 1965
[K. SliBBA R\O, RAGHUBAR DAYAL AND R. S. BKHAWAT, JJ.]
Madra.< Agriculturists Reliej Acr (Mad. Act IV of 1938), as amPnded
by Act XV of 1943 and Act XXXll of 1943. s. 9·A(l0l (ii) (bl-Mortgage debt not to be scaled down if mortgagee's right.'i transferred bona (ulc
for ''a/uable considcrarion-Transfer of
/l.fort;:agee's rights
to family
charity in lieu of sum earlier tfedicatl•d 10 the charity-Such transfer 'Whether for valuable cunsi<leration- wi1hin the meaning of proviso.
TI1c predecc'iwrs-in-intcrc<;t of the appellants executed in 1930 n registered mortgage deed (Ex.A-I) in favour of the respondent family for
Rs. 31,000. It v.·as a usufruc~uo.ry n1ortgagc
rcdccm~1ble aflcr 60 years.
The mortgagors filed a petition
under s. 9A and <. l 9A of the Madras
Agricultu1ists Relief Act for scaling do°""n the mort~age debt thereunder.
The moitgagccs raised a plea, inter alia, that the 1nortgage interest had
been transfcrr~ to a charity for valuable
con::<1idcration
and
therefore
a. 9A(IO)(ii)(b) of the Act was Ml attracted and hence the mortgage
debt wns oot liable to he scalc-0 down under the Act.
The pica was based
on document• Ex.II.[, Ex.B·2 and
Ex.B-3.
The learocd Subordinate
Judge, held that the transferee-the charity-not being a transferee for
valuable consideration s. 9A( lO)(i1) (b) did not arply. and on this fiodiog he r.caled down the mortga~e debt.
An appeal was filed by the mortgagees wherein the High Court held that the
transfer \Vas for valuahlc
consideration and therefore the debt
could
not be scaled down.
The
mortgagors ap~Jlcd to the Supreme Court with ccrtific;.;te.
HELD: (i) The agreement E"t;.R-1 executed bctv.ccn mcn1hcrs of the
mortgagee family sh~l'Ncd -that on August 22. 1934. the f~rnily created a
tn1st in respect of a sum of Rs. 36,988-9-8 for a charitable purposes. On
September 3, 1939, hy Ex.B-2. the usulructuary mo·tgagce right of the
family in Ex.A-I \VJS given to the charity in discharge of the obligation
under fa.B-1.
The dedication of the said property was affirmed by the
regular partition deed Ex.B-3.
In short under the said documenlo; the
family transferred to the charity their in!crest in the
usufructuary mortgage Ex.A-1 in d:scharge of the obligation to pay the trust a sum of
Rb. 36.988-9-8. 1174 E-GJ
(ii) It is implied in the dcfinit:on of th~ \vord 'consideration' in s. 2(d}
of the Contract .A.ct th:.it the consideration should
be 'something \\·hich
not only parti~s regard but the 1:1\\' can rc,c.~rd as having some value·. It
is apparent fror.1 tht' definition th;!t con..,id\!ration
m·1y he negative or
positive. [ 177 A-BJ
(iii) In th:: present case the family w:~s unJcr an obl;r,Jtion to pay to
the charity the amount scr ~part to it under Ex.B-1. l'he mortgage interest \Va.s transferred in dis;;::hargc of th:1t o1;i:gJtion.
That i-.; to say the
churHy agreed a·;
~1. consider.ttion f.:>r the lrailsfer of i.hc mortgage intere:;t
not to c::iforcr it:; right :o recover that amount from the family.
·rhc
charity gave up :h::t
ri~ht ~n consideration of
the
mortgage
interest
acquired by it.
Therefore it is clcaoth~t the family
transferred
the
mortgage interest in trust to the charity for valuable consideration \vith
lhc meaning of •· 9A(IO)(ii)(b) of the Act. [177 B-DJ
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CHIDAMBARAIYAR v. RENGA IYER (Subba Rao, J.)
169
It followed that the mortgage, Ex.A-I, was rightly held by the High
Com! not liable to be scalell down under the proviruons of the Act.
[1770]
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 200 of
1963.
Appeal from the judgment and order dated November 8, 1955,
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of the Madras High Court in A.AO. No. 577 of 1952.
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R. Ganapaihy l~er, S. N. Prasad, and J. B. Dadachanii, for
the appellants.
[(. N. Ra;agopala Sastri, M. R. Krishna Pillai and M. S. K.
Aiyangar, for respondent no. 1.
The Judgment of the Court was delivered by
Sobba Rao, J.
This appeal by certificate raises the question
of the applicability of s. 9-A(lO)(ii)(b) of the Madras Agriculturists Relief Act (Madras Act IV of 1938), hereinafter called
the Act, as amended by Act XV of 1943 and Act XXIII of
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1943, to a mortgage in respect whereof a petition for scaling
down the said mortgage debt under the provisions of the Act was
filed.
On August 18, 1930, the predecessors-in-interest of the appellants executed a registered
deed of usufructuary mortgage in
E favour of the family of Samu Pattar for Rs. 31,000.
No interest was stipulated in the document, but the mortgagee was put
in possession of the mortgage property.
The mortgagee had to
enjoy the income from the said property, and after appropriating
interest due on the mortgage and after paying the revenue and
the jenmi's purappad, he was to pay to the mortgagors one edangali
F of paddy every year within the 30th of Makarom.
The mortgage
was redeemable after the expiry of 60 years from the date of the
mortgage.
The 11th appellant and his deceased father, Narayana
Iyer, filed O.P. No. 43 of 1949, on the file of the Court of
Subordinate Judge, Palghat, under s. 9-A and 19-A of the Act for
scaling down the mortgage debt thereunder. To that petition,
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appellants 1 to 10 and other mortgagers were impleaded as respondents 2 to 14, and the mortgagee, as the first respondent. As
the said first respondent-mortgagee raised the plea that the mortgage interest had been set apart by the members of his family
to a charity, respondents 15 and 16, who were the seniormost
male members of their respective branches
of the mortgageeH
family, were also impleaded as respondents to the said petition.
The contesting respondents, inter alia, raised two pleas,
namely, ( 1) the mortgage property was transferred in trust to
170
SUP.REMB comr JlEPOUS
[1966] 1 S.C.R.
the charity for valuable consideration and, therefore, s. 9-A( 10)
(ii) ( b) of the Act was attracted and hence the mortgage was
not liable to be scaled down .under the Act; and (2) the said
mortgage right was the subject-matter of a partition amongst the
several members of the joint family consisting of respondents I.
15, 16 and others and, therefore, the said mortgage was exempted
under s. 9-A( 10) (ii) (c) of the Act from its operation.
On the first question the learned Subordinate Judge held that
"The transferee, viz .. the charity, not being a transferee for valuable consideration" the proviso to s. 9-A( 10) (ii) (b)
did
not
apply; and on the second question he held that the partition of
the family in the sense of division in .status was effected before
the relevant period and. that apart. as the mortgage interest of
the family wa.s not allotted to some or one of the members of
the family but a trust was created in respect thereof in favour
of a charity.
s. 9-A ( 10) (ii)( c J had no application.
In the
rcsuit he allowed the petition and granted a certificate to the
petitioners and re-spondents 2 to 14 to the effect that the amount
due under the mortgag.c on the date he made the
ordc:·
was
Rs. 8,788-14-10.
As the fir>t respondent died pending the proceedings in the
Court of the Subordinate Judge. the 17th respondent. his younger
brother, was brought on record in his place.
Against the order of the learned Subordinate Judge. the 17th
respo:idcnt preferred an appeal to the High Court of Judicature
at Madras. bein[! A.A.0. No. 557 of 1952.
To that appeal, the
petitioners and other respondents were made respondents.
On
the first question. the Hi~h Court held that the family transferred
the mortga~e interest for valuable consideration in favour of the
charity within the meaning of para (b) of s. 9-A( lO)(ii) of the
Act; and on the sccQ':'ld question
it held that
the
expression
"partition" in s. 9-A ( 10) (ii) ( c) meant partition bv metes and
bounds and though it was effected durin!! the relevant period the
mortga~~ intere't in the property was not the suhje<:t of partition
and, therefore. the said provision was not attrncted to the mortgage in question.
In the result. the High Court, disa~;reeing with
the view expressed bv the learned Subordinate Judge. set aside
the order made by him and dismissed the petition filed by the
mo~tgagors for scaling down the debt.
Against the said order
the mortgagors have preferred, on a certificate i.ssued by the High
Court, the present appeal to this Court.
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CHIDAMBARAIYER V. RENGA IYER (Subba Rao, J.)
171
Mr. Prasad, learned counsel for the appellants contended that
(i) there was no transfer of the mortgage property in trust for
a charity but the said property continued to be the property of
the joint family, though a charge was created on its income for
some charitable purposes; and (ii) there was no transfer of the
morcgage interest for valuable consideration.
Mr. Rajagopala Sastri, learned counsel for the respondents,
apart from attempting to sustain the finding of the High Court
that there was a transfer of the mortgage property for valuable
consideration, contended that the transfer of the mortgage property in trust was an integral step in the process of partition and,
therefore, in law and in fact it must be held that the said property
was also subject of partition within the meaning of para ( c) of
s. 9-A( 10) (ii) of the Act.
At the outset it will be convenient to read the relevant provisions of s. 9-A (10 )(ii) of the Act.
"Nothing contained in this section,
except
subsections ( 1) and (2), shall apply to any mortgage--
(ii) in respect of property situated in any other
area in the cases mentioned below :-
(a) Where during the period after the 30th September 193 7
and before the
30th January
1948 ................... .
(b) Where during the period aforesaid, the mortgagee or any
of his successors-in-interest has
interest belonged to, or devolved on, two or more
gagee's rights in the property bona fide and for
valuable consideration, then, to the whole or
such part, as the case may be :
( c) Where the mortgagee's interest in the property
subject to the mortgage or any part of such
interest belonged to, or devolved on, two or more
persons and during the period aforesaid, a partition has taken place among such persons, then,
to the whole or such part of the interest, as the
case may be.
It will be seen from the said provisions, so far relevant to the preH
sent enquiry, that the mortgagee's rights under para (b) or mortgagee's interest in the property shall have been bona fide
transferred for valuable consideration or shall have been partitioned
i.SSup./65-12
t 7 2
SUPREME
COURT
REPORTS
(1966) l S.C.L
among the joint owners during the period between September 30,
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1937, and January 30, 1948, in order to earn the exemption from
the operation of the provisions of s. 9-A(IO)(ii) of the Act.
As
we agree with the High Court that the mortgage interest was transferred for valuable consideration within the meaning of para (b)
of s. 9-A(IO) (ii) of the Act. we are relieved of the n~cessity to
consider either the scope or the applicability of para ( c) of the
B
said section to the mortgage in question.
Under para (b) of s. 9-A( 10) (ii) of the Act two questions
arise, namely, ( l) wh~ther the mortgage rights in the property
were legally transferred in trust in favour of the charity; and (2)
if so, whether the transfer was for valuable consideration. If there c
was such a transfer, it is not disputed that it was effected during
the relevant period mentioned in the section.
Exhibit B-1 is an agreement dated August 22, 1934, executed
between the members of the mortgagee-family.
The relevant part
of the document reads :
"All of us have out of our free will and consent set
apart on this day the sum of Rs. 36,988-9-8 found entered against the date 30th Meenom 1109 M.E. (12th
April 1934) in tbc ledger book under the head "kulathoorayyan" in the accounts maintained in respect of
our common family business, the interest accrued thereon
from the aforesaid date, the sum of Rs. 1.490 found
entered in the ledger under the head "Pata.sala", ..... .
(other properties arc mentioned) ................. .
for charitable purposes for the welfare and prosperity
of our family.
And it is stipulated that the undermentioned ceremonies shall be performed with
the
income derived from the aforesaid properties.
. . . . . (specific amounts to he spent for
different purposes are given) . . . .
It has been stipulated that the management of the
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aforesaid properties endowned for purposes of charity
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shall be conducted by the seniormost male members of
the respective branches for each year by rotation.
commencing from first Kanni 1110 M.E. (17th September 1934) and the accounts shall be rendered to the
satisfaction of the members of the rest of the branches
at the end of the year."
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The recitals of this documents arc clear and unambiguous. Under
this document the members of the family set apart a specific
•
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CHIDAMBARAIYER v. RENGA IYER (Subba Rao,!.)
173
A amount and other properties for charitable purposes. Under the
1
scheme of administration the seniormost male members of the
different branches of the family were constituted the managers
and they were directed to pay specified amounts for specific religious purposes. The members of the family were the authors of
the trust.
The seniormost male members of the respective bran-
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B ches were the trustees.
The charity was the beneficiary. The
subject-matter of ~he trust was the said amount and the properties.
All the necessary ingredients of a trust are present in the document. It is, therefore, clear that the document created a valid
trust of the said amount.
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Exhibit B-2 dated September 3, 1939, is a part of "schedule,
of partition allotted to the members of the E.N.A.S. family". It
reads:
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"Particulars regarding the properties that have been
set apart for charity from our joint family.-
I. Properties situate in Kunisseri Amsom which
belong to N. C. Sivarama Ayyar of Nellisseri Grammom
and others and which belong to our family in (usufructuary mortgage) right for a sum of Rs. 31,000 and
which are held benami in the name of Appathura Pattar
alias Seshan Pattar of Melkode Gramm om."
The document contains other items of properties set apart for
charity.
Exhibit B-3, the registration copy of the partition deed dated
September 9, 1939, shows that the schedule was prepared in connection with the oral partition agreed upon on September 3. 1939.
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After orally dividing the properties among the members of
the family and setting aside the said mortgage interest and other
properties for charity, on September 9, 1939, the said registered
partition deed was executed embodying the terms of the oral
partition. It is common knowledge that before a regular registered partition deed is effected, there will necessarily be a stage
a when the terms embodied in the registered document are agreed
upon orally between the parties. It is a necessary prelude for
executing the formal document.
Ex. B-3 appears to be such a
document embodying the terms orally agreed upon between the
parties at an earlier stage.
This document governs the rights of
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the parties.
The relevant recital in the document reads :
"Out of the immovable properties which were set
apart previously as mentioned in paragraph 2 above,
which were reserved in common at that time and which
174
SUPREME
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REPORTS
[ 196tJ t s.c.R.
were acquired subsequently,· some immovable properties
were set apart under schedule I for our common family
"poivate trust" for the purpose of charity.
Under the
oral partition effcctod on 3rd September 1939 all the
immovable properties belonging to our common family
excluding those set apart for charity as stated above were
partitioned into 9 schedules from A to I in accordance
with our proportionate shares .......... But whereas
we have all agreed that the management in respect of
the properties in the aforesaid schedule I set apart for
charitable purpose and the expenses, etc. to be met with
the income shall be conducted and caused to be conducted without default as set out in the aforesaid agreement entered into between us on 22nd August 1934
and that we shall also conduct ourselves in future in
accordance with the terms of the said agreement, no special stipulation has been made in this partition deed with
regard to the above mentioned properties endowed for
charitable purpose and the incomes derived therefrom."
This registered partition deed in terms affirmed the earlier creation
of trust.
From these documents it can be rea;onably held as follows :
(I) On August 22, 1934, the family created a trust in respect
of a sum of Rs. 36,988-9-8 for charitable purposes; (2) on September 3, 1939, the usufructuary mortgage right of the family
in Ex. A-I was given to the charity in discharge of the obligation undertaken under Ex. B-1; and (3) the dedication of the
said property was affirmed in the regular partition deed.
In short,
under the said documents the family transferred to the charity
their interest in the usufructuary mortgage. Ex. A-1, in discharge
of their obligation to pay the trust a sum
of Rs. 36,988-9-8.
Indeed the High Court, on a consideration of the said documents
arrived at exactly the same finding.
The learned Judges of the
High Court observed :
"On a comparison of the charity properties mentioned
in Exhibits 13-1 and B-2, we find that item No. 3 in Exhibit B-1 is the same as item No. 2 in B-2.
Similarly
item No. 4 in Exhibit B-1 corresponds to item No. 3
in Exhibit B-2.
Item No. 5 in Exhibit B-1 is admitted
to be item No. 4 in Exhibit B-2 and item No. 6 in
Exhibit B-1 is the same as item No. 5 in Exhibit B 2.
Items Nos. 1 and 2 in Exhibit B-1 arc not mentioned
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CHIDAMBARAIYER V. RENGA IYER (Subba Rao,!.)
175
in Exhibit B-2, but they are replaced by item No. 1
in Exhibit B-2 which is the mortgage. It is seen that
items 1 and 2 in Exhibit B-1 are credit entries of the
aggregate amounts in the family business accounts but
what is done by Exhibit B-2 is the replacement of those
amounts by the mortgage in question. No evidence has
been let in as to what has become of those two amounts.
Evidently being credit entries they have been converted
into tangible immovable assets for the purposes of conducting the charity.
It is more or less in the nature
of substituting a credit entry by means of some property, i.e., ~he discharge of the liability of those credit
entries by setting apart immovable property.
Exhibit
B-3, dated 9th September 1939 is a registered copy of
the partition deed by the members of the family and
paragraphs 2 and 4 of that document make provision
with regard to the matters in question which run as
follows :
Later on the learned Judges proceed to state :
"We are unable
to accept the arguments for the
reasons stated already. It is clear as we have refecred
to already that for the amounts entered as credit in the
family business account which was a liability payable
by the family from and out of the interest under Exhibit B-1 the religious functions have to be performed
and that there was a substitution of the mortgage amount
under Exhibit B-3.
Mr. Ramachandra Aiyar contends
that there is no oral evidence about that substitution;
nor is it possible to conclude from the meagre
and
scantly documentary evidence let in that there has been
any such substitution.
The answer to this argument is
that the credit amount in favour of Kolathu Iyen is only
a ledger entry making the liability on the family with
regard to a sum of money out of which certain charities
have to be performed.
In Exhibit B-3 we do not find
any credit entry in the name of Kolathu Iyen as well
as patasala account.
Those liabilities must be deemed
to have been
discharged by item I in Exhibit B-2,
namely, the mortgage amount.
The result is the discharge of one liability by another and we are unable
to see that such a state of things would not amount to
a transfer."
176
SUPREME
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'REPORTS
[ 1966) I S.C.'R.
These observations also make it clear that the learned Judges
clearly held that the mortgage interest in Ex. A-I was transferred
in discharge of the liability undertaken under Ex. B-1.
But strong
reliance was placed by the learned counsel for the appellants on
the following concluding observation of the learned Judges :
A
"In the present case the joint family has lost the
B
mortgage interest and the trust has gained that interest.
Therefore the transfer under Ex. B-3 must be deemed
to be for valuable consideration."
Reiying upon this observation the learned counsel commented
that the learned Judges held that a mere transfer of an interest
in favour of another was in itself a transfer for valuable consideration.
To accept this argument is to ignore the elaborate discussion that preceded the said observation
and
the
relevant
extracts from the judgment we have extracted earlier. In the
context of the p~cceding discussion the said observation can only
mean that the transfer in favour of a charity in discharge of the
earlier ob!igation is a transfer for valuable consideration. Agreeing with the High Court, we hold that there was a transfer of
the mortgage interest under Ex. A-I in trust to a charity in discharge cf an earlier obligation undertaken by the family to set
apart a sum of Rs. 36,988-9-8 in favour of the charity.
Under
para (b) of s. 9-A( lO)(ii) of the Act. to attract that provision
the transfer shall be for a valuable consideration.
The short
question, therefore, is whether the transfer in trust of a property
in discharge of an earlier obligation was for valuable consideration
within the meaning of para (b) of s. 9-A (I 0 (ii) of the Act.
So stated there can only be one answer.
The classic definition
of "valuable consideration" is given in Currie v. Misa(') thm :
"A valuable consideration in the sense of the law
may consist either in some
right, interest,
profit or
benefit accruing to one party, or some forbearance.
detriment, loss or responsibility, given, suffered or undertaken by the other."
Section 2 ( d) of the Contract Act defines consideration thus :
"When. at the desire of the promisor, the promisee
o~ any other person has done or abstained from doing,
or does or absroins from doing, or promises to do or
to abstain from doing somethinj!. such act or abstinence
or promise is called a consideration for the promise."
(I) (1875) L.R. 1:1 Ex. 162.
c
D
E
F
G
II
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CHIDAMBARAJYER v. RENGA IYER (Subba Rao, J.)
177
A
So far as is relevant to the present enquiry, the content of the
two definitions is practically the same, though the expression
"valuable" is implied under s. 2(d) of the
Contract Act, for
consideration shall be "something which not only parties regard
but the law can regard as having some value".
From the definitions it is apparent that consideration may be negative or positive.
B In the present case the mortgage interest was transferred in trust
to the charity.
What was the consideration that passed from
the charity to the family ? The family was under an obligation
to pay to the charity the amount set apart to it under Ex. B-1.
The mortgage interest was transferred in discharge of that obligation.
That is to say, the charity agreed as a consideration for
C
the transfer of the mortgage interest not to enforce its right to
recover that amount from the family.
The charity gave up that
right in. consideration of the mortgage interest acquired by it.
We, therefore, hold that the family transferred
the mortgage
interest in trust to the charity for valuable consideration within
0
the meaning of s. 9-A(lO)(ii)(b) of the Act.
It follows that
the mortgage, Ex. A-1, was rightly held by the High Court not
liable to be scaled down under the provisions of the Act.
In the reply the learned counsel for the appellants sought to
raise another plea, namely, that there was no valid transfer of
the mortgage deed in favour of the charity inasmuch as the said
E
trzmsfer was not effected by a registered document.
This plea
was not raised at any stage of the litigation, presumably because
Ex. B-3 was a registered document. We cannot, therefore, permit
the appellants to raise the plea for the first time before us.
Xn this view it is not necessary to express our opinion on
F
the question whether para (c) of s. 9-A(lO)(ii) of the Act was
attracted to the mortgage in question.
In the result, the' appeal fails and is dismissed with costs.
Appeal dismissed .