# R. JANAKIAMMAL v. S.K. KUMARASAMY(DECEASED) THROUGH LEGAL REPRESENTATIVES AND OTHERS

- **Citation:** [2021] 6 S.C.R. 333
- **Court:** Supreme Court of India
- **Decided:** 2021-06-30
- **Case number:** Civil Appeal No. 1537 of 2016
- **Bench:** Ashok Bhushan, R. Subhash Reddy
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/r-janakiammal-v-s-k-kumarasamy-deceased-through-legal-representatives-and-others-34948
- **Pages:** 53

## Headnote

Code of Civil Procedure, 1908: Or.XXIII r.3 - Compromise
decree - r.3 of Or. XXIII provides that where it is proved to the
satisfaction of the Court that a suit has been adjusted wholly or in
part by any lawful agreement or compromise, the Court shall order
such agreement or compromise to be recorded and pass a decree in
accordance therewith - r.3 uses the expression "lawful agreement
or compromise" - A conjoint reading of ss.10, 13 and 14 of Indian
Contract Act indicates that when consent is obtained by coercion,
undue influence, fraud, misrepresentation or mistake, such consent
is not free consent and the contract becomes voidable at the option
of the party whose consent was caused due to coercion, fraud or
misrepresentation - An agreement, which is void or voidable under
the Indian Contract Act, shall not be deemed to be lawful as is
provided by Explanation to r.3 of Or.XXIII - Contract Act, 1872.
Code of Civil Procedure, 1908: Or.XXIII r.3A - In the plaint,
plaintiff pleaded that compromise recorded on 06.08.1984 was not
lawful compromise having been obtained by fraud and
misrepresentation - Plaintiff's case was that they were represented
by D1 that the compromise was entered only to save the family
property since the plaintiff has given personal guarantee to the
Bank for obtaining loan for business - Pleadings clearly made out
the case of the plaintiff that the consent which he gave for
compromise by signing the compromise deed was not free consent -
The compromise, thus, became voidable at the instance of the plaintiff
- Thus, bar under r.3A shall be attracted.
Consent decree: Challenge against - A party to a consent
decree based on a compromise to challenge the compromise decree
on the ground that the decree was not lawful, i.e., it was void or
voidable has to approach the same court, which recorded the
[2021] 6 S.C.R. 333
333
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compromise and a separate suit challenging the consent decree has
been held to be not maintainable.
Hindu law: Joint Hindu Family - Under Hindu Law, any
member of the joint family can separate himself from joint family -
The intention of the parties to terminate the status of joint family is
a relevant factor to determine the status of Hindu Undivided Family
- In the instant case, real intendment of three branches to partition
their properties was not that they did not want Hindu Undivided
Family to continue rather the said partition was with object to get
away from application of Land Ceiling Act, 1961 - Partition Deed
dated 07.11.1960 being a registered Partition Deed between three
branches, the same cannot be ignored - Properties admittedly were
divided in three branches by the said partition - However even
after 07.11.1960, the family continued as a Joint Family - There
was reunion between three brothers to revert to the status of Joint
Hindu Family, which is amply proved from the acts and conducts of
the parties subsequent to 07.11.1960 - The purchase of various
immovable properties in the names of the three branches clearly
indicated the intention that all the three branches were joint and
they were purchasing the properties in the name of all the three
branches - Plaintiff never admitted the agreement dated 08.03.1981
or alleged partition of 08.03.1981 - It is, thus, clear that parties
remained joint and properties standing in the names of three branches
remained joint till the consent decree was passed on 06.08.1984 -
Thus, in the year 1979 when residential property of Tatabad was
obtained in the name of defendant No.1, all three branches were
part of the joint Hindu family and the house property purchased in
the name of one member of joint Hindu family was for the benefit of
all - Both the Courts below although accepted the partition dated
18.03.1981 as pleaded by D-1 but erred in not considering the
consequence of such pleading - When partition of all immovable
and movable properties is claimed on 08.03.1981, the conclusion
is ir

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333
R. JANAKIAMMAL
v.
S.K. KUMARASAMY(DECEASED) THROUGH
LEGAL REPRESENTATIVES AND OTHERS
(Civil Appeal No. 1537 of 2016)
JUNE 30, 2021
[ASHOK BHUSHAN AND R. SUBHASH REDDY, JJ.]
Code of Civil Procedure, 1908: Or.XXIII r.3 - Compromise
decree - r.3 of Or. XXIII provides that where it is proved to the
satisfaction of the Court that a suit has been adjusted wholly or in
part by any lawful agreement or compromise, the Court shall order
such agreement or compromise to be recorded and pass a decree in
accordance therewith - r.3 uses the expression "lawful agreement
or compromise" - A conjoint reading of ss.10, 13 and 14 of Indian
Contract Act indicates that when consent is obtained by coercion,
undue influence, fraud, misrepresentation or mistake, such consent
is not free consent and the contract becomes voidable at the option
of the party whose consent was caused due to coercion, fraud or
misrepresentation - An agreement, which is void or voidable under
the Indian Contract Act, shall not be deemed to be lawful as is
provided by Explanation to r.3 of Or.XXIII - Contract Act, 1872.
Code of Civil Procedure, 1908: Or.XXIII r.3A - In the plaint,
plaintiff pleaded that compromise recorded on 06.08.1984 was not
lawful compromise having been obtained by fraud and
misrepresentation - Plaintiff's case was that they were represented
by D1 that the compromise was entered only to save the family
property since the plaintiff has given personal guarantee to the
Bank for obtaining loan for business - Pleadings clearly made out
the case of the plaintiff that the consent which he gave for
compromise by signing the compromise deed was not free consent -
The compromise, thus, became voidable at the instance of the plaintiff
- Thus, bar under r.3A shall be attracted.
Consent decree: Challenge against - A party to a consent
decree based on a compromise to challenge the compromise decree
on the ground that the decree was not lawful, i.e., it was void or
voidable has to approach the same court, which recorded the
[2021] 6 S.C.R. 333
333
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compromise and a separate suit challenging the consent decree has
been held to be not maintainable.
Hindu law: Joint Hindu Family - Under Hindu Law, any
member of the joint family can separate himself from joint family -
The intention of the parties to terminate the status of joint family is
a relevant factor to determine the status of Hindu Undivided Family
- In the instant case, real intendment of three branches to partition
their properties was not that they did not want Hindu Undivided
Family to continue rather the said partition was with object to get
away from application of Land Ceiling Act, 1961 - Partition Deed
dated 07.11.1960 being a registered Partition Deed between three
branches, the same cannot be ignored - Properties admittedly were
divided in three branches by the said partition - However even
after 07.11.1960, the family continued as a Joint Family - There
was reunion between three brothers to revert to the status of Joint
Hindu Family, which is amply proved from the acts and conducts of
the parties subsequent to 07.11.1960 - The purchase of various
immovable properties in the names of the three branches clearly
indicated the intention that all the three branches were joint and
they were purchasing the properties in the name of all the three
branches - Plaintiff never admitted the agreement dated 08.03.1981
or alleged partition of 08.03.1981 - It is, thus, clear that parties
remained joint and properties standing in the names of three branches
remained joint till the consent decree was passed on 06.08.1984 -
Thus, in the year 1979 when residential property of Tatabad was
obtained in the name of defendant No.1, all three branches were
part of the joint Hindu family and the house property purchased in
the name of one member of joint Hindu family was for the benefit of
all - Both the Courts below although accepted the partition dated
18.03.1981 as pleaded by D-1 but erred in not considering the
consequence of such pleading - When partition of all immovable
and movable properties is claimed on 08.03.1981, the conclusion
is irresistible that the family was joined till then - Thus, the theory
set up by D-1 that all the three branches were separate after
07.11.1960 is denied/belied by claim of partition on 08.03.1981.
Partly allowing the appeals, the Court
HELD: 1.1 Order XXIII Rule 3 provides for compromise
of suit. In Rule 3 amendments were made by Act No. 104 of 1976
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by which a proviso and an explanation was added. By the same
amendment Act No.104 of 1976, a new Rule, i.e., Rule 3A was
added providing that no suit shall lie to set aside a decree on the
ground that the compromise on which the decree is based was
not lawful." [Paras 39, 40][355-E; 356-B-C]
1.2 Determination of disputes between persons and bodies
is regulated by law. The legislative policy of all legislatures is to
provide a mechanism for determination of dispute so that dispute
may come to an end and peace in society be restored. Legislative
policy also aims for giving finality of the litigation, simultaneously
providing higher forum of appeal/revision to vend the grievances
of an aggrieved party. Rule 3A which has been added by above
amendment provides that no suit shall lie to set aside a decree
on the ground that the compromise on which the decree is based
was not lawful. At the same time, by adding the proviso in Rule 3,
it is provided that when there is a dispute as to whether an
adjustment or satisfaction has been arrived at, the same shall be
decided by the Court which recorded the compromise. Rule 3 of
Order XXIII provided that where it is proved to the satisfaction
of the Court that a suit has been adjusted wholly or in part by any
lawful agreement or compromise, the Court shall order such
agreement or compromise to be recorded and pass a decree in
accordance therewith. Rule 3 uses the expression "lawful
agreement or compromise". The explanation added by
amendment provided that an agreement or a compromise which
is void or voidable under the Indian Contract Act, 1872, shall not
be deemed to be lawful." [Para 41][356-C-G]
1.3 Reading Rule 3 with Proviso and Explanation, it is clear
that an agreement or compromise, which is void or voidable,
cannot be recorded by the Courts and even if it is recorded the
Court on challenge of such recording can decide the question.
The Explanation refers to Indian Contract Act. The Indian
Contract Act provides as to which contracts are void or voidable.
Section 10 of the Indian Contract Act provides that all agreements
are contracts if they are made by the free consent of parties
competent to contract, for a lawful consideration and with a lawful
object, and are not hereby expressly declared to be void. A
R. JANAKIAMMAL v. S.K. KUMARASAMY(DECEASED) THROUGH
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consent when it is caused due to coercion, undue influence, fraud,
misrepresentation or mistake is not free consent and such
agreement shall not be contract if free consent is wanting. A
conjoint reading of Sections 10, 13 and 14 of Indian Contract Act
indicates that when consent is obtained by coercion, undue
influence, fraud, misrepresentation or mistake, such consent is
not free consent and the contract becomes voidable at the option
of the party whose consent was caused due to coercion, fraud or
misrepresentation. An agreement, which is void or voidable under
the Indian Contract Act, shall not be deemed to be lawful as is
provided by Explanation to Rule 3 of Order XXIII. [Paras 42, 43,
44][356-G-H; 357-A, D; 358-A-B]
1.4 It is clear from the plaint that plaintiff pleaded that
compromise recorded on 06.08.1984 was not lawful compromise
having been obtained by fraud and misrepresentation. The
plaintiff's case was that they were represented by D1 that the
compromise is being entered only to save the family property
since the plaintiff has given personal guarantee to the Punjab
National Bank for obtaining loan for Vasudeva Mills. Pleadings
clearly make out the case of the plaintiff that the consent which
he gave for compromise by signing the compromise was not free
consent. The compromise, thus, become voidable at the instance
of the plaintiff. Rule 3A bars the suit to set aside the decree on
the ground that compromise on which decree was passed was
not lawful. The word "lawful" has been used in Rule 3 and in the
Explanation of Rule 3 states that "an agreement or compromise
which is void or voidable under the Indian Contract Act,1872
shall not be deemed to be lawful...................;" Thus, the bar
under Rule 3A shall be attracted if compromise on the basis of
which decree was passed was void or voidable. [Paras 47, 48,
49][359-A-E]
Banwari Lal v. Chando Devi (Smt.) though LRs. and
Anr. (1993) 1 SCC 581 : [1992] 3 Suppl. SCR 524 ;
Pushpa Devi Bhagat (Dead) Through LR. Sadhna Rai
(Smt.) v. Rajinder Singh and Ors. (2006) 5 SCC 566
: [2006] 3 Suppl. SCR 370 ; R. Rajanna v. S.R.
Venkataswamy and Ors. (2014) 15 SCC 471 : [2014]
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14 SCR 535; Triloki Nath Singh v. Anirudh Singh
(Dead) through Legal Representatives and Ors. (2020)
6 SCC 629 - relied on.
1.5 A party to a consent decree based on a compromise to
challenge the compromise decree on the ground that the decree
was not lawful, i.e., it was void or voidable has to approach the
same court, which recorded the compromise and a separate suit
challenging the consent decree has been held to be not
maintainable. In Suit No.1101 of 1987, the plaintiff prayed for a
declaration declaring that the decree passed in O.S. No. 37 of
1984 is sham and nominal, ultravires, collusive, unsustainable
invalid, unenforceable and not binding on the plaintiffs. On the
basis of grounds which have been taken by the plaintiff in Suit
No.1101 of 1987, the only remedy available to the plaintiff was to
approach the court in the same case and satisfy the court that
compromise was not lawful. There was no error in the judgment
of trial court and High Court holding that Suit No.1101 of 1987
was barred under Order XXIII Rule 3A. The compromise decree
dated 06.08.1984, thus, could not have been questioned in Suit
No. 1101 of 1987. [Paras 55 and 56][364-C-H]]
2.1 The case of the appellant is that the partition deed dated
07.11.1960 was entered between three brothers to save the
properties from land ceiling laws. The relevant date under the
Land Ceiling Act was 07.04.1960 on which date the extent of
properties in hands of a person has to be determined and since
three brothers, who consisted members of joint family on the
relevant date had more than the land which was permitted to a
person, a partition was entered to save the properties from land
ceiling laws. This argument was rejected by the trial court holding
that it has not been proved that land ceiling laws in any manner
affected the extent of land in the hands of three brothers.
[Para 74][369-H; 370-A-B]
2.2 Section 5 of the Land Ceiling Act provide for ceiling
area. According to sub-section (1)(a) of Section 5, the ceiling area
in the case of every person and in the case of every family
consisting of not more than five members was 30 standard acres.
Figure of 30 standard acres was subsequently reduced to 15
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standard acres by Tamil Nadu Act No. 37 of 1972. Section 5(1)(b)
further provided that ceiling area in the case of every family
consisting of more than five members shall be 30 standard acres
together with an additional 5 standard acres for every member of
the family in excess of five. In event, the ceiling area is determined
treating the Hindu Undivided Family, joint family consisting of
three brothers, the ceiling area shall be 30 standard acres by
which 5 acres additional for every member of the family in excess
of five. The land which was possessed by the three brothers in
the year 1960 was more than 86.52 acres, which extent was
received by the three brothers in 1953 partition. Thereafter three
brothers have acquired further land. In case, three brothers before
07.04.1960 partition their joint family, then each person will be
entitled to 30 acres. Thus, partition of the properties among three
brothers was clearly beneficial to the properties possessed by
the three brothers. The view of the trial court that it is not proved
that any benefit under the Ceiling of Land Act could have been
obtained by three brothers is clearly untenable. The view
expressed by the trial court was not after examining the
provisions of Act, 1961. Further the statement in the partition
that three brothers have already divided the immovable
properties on 01.04.1960 clearly was with intent to get away from
Act, 1961 since the relevant date under the Ceiling Act was
07.04.1960. [Para 75][370-D-H]
2.3 Under Hindu Law, any member of the joint family can
separate himself from joint family. The intention of the parties to
terminate the status of joint family is a relevant factor to determine
the status of Hindu Undivided Family. It is clear that real
intendment of three branches to partition their properties was
not that they did not want Hindu Undivided Family to continue
rather the said partition was with object to get away from
application of Ceiling Act, 1961. The intention of the parties when
they partitioned their properties in the year 1960 is a relevant
fact. [Para 76][371-A-B]
2.4 However, the Partition Deed dated 07.11.1960 being a
registered Partition Deed between three branches, the same
cannot be ignored. Properties admittedly were divided in three
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branches by the said partition. The question is as to whether
after 07.11.1960, the family continued as a Joint Family or the
status of joint family came to an end on 07.11.1960. The case of
the appellant which was also pressed by the High Court was that
even if partition dated 07.11.1960 is accepted; the parties lived
in a joint family and continued their joint family status. The
contention advanced by the appellant was that there was reunion
between three brothers to revert to the status of Joint Hindu
Family, which is amply proved from the acts and conducts of the
parties subsequent to 07.11.1960. The concept of reunion in Hindu
Law is well known. Hindu Joint Family even if partitioned can
revert back and reunite to continue the status of joint family.
[Paras 77 and 78][371-C-E]
Mulla on Hindu Law, 22nd Edition - referred to.
Mukku Venkataramayya v. Mukku Tatayya and Ors.
AIR 1943 Mad. 538; M/s. Paramanand L. Bajaj,
Bangalore v. The Commissioner of Income Tax,
Karnataka, II, Bangalore, (1981) SCC Online
Karnataka 131 J; Bhagwan Dayal v. Reoti Devi AIR
1962 SC 287: [1962] 3 SCR 440; Anil Kumar Mitra
and Ors. v. Ganendra Nath Mitra and Ors. (1997) 9
SCC 725 [1996] 9 Suppl. SCR 338; Palani Ammal v.
Muthuvenkatacharla Moniagar and Ors. AIR 1925 PC 49
- referred to
3.1 The ancestral house of the parties was at Helmet,
Sedapalayam, Village Karumathampaty where three brothers
alongwith their father used to live. DW2 in her statement has
also stated that after her marriage, she lived at ancestral house
at Sedapalayam. Further the three brothers in the year 1963
purchased the house site at Hemlet Somanur and constructed a
new house where three brothers with their families shifted and
lived at Somanur which became the new home of the Joint Family
consisting of three brothers. The new house was constructed
after purchasing the land in the year 1963 and the families of the
three brothers started living at about in 1964, which clearly
indicate that intention of all the brothers was to live jointly and
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continue as Joint Hindu Family. After partition dated 07.11.1960,
three branches have purchased several immovable properties
together. [Para 85][379-D-F]
3.2 The three branches continued joint business by
establishing firms and companies which was carried by joint family
in the partnership or by private company. It was only the members
of the family, who were shareholders and directors. The purchase
of various immovable properties in the names of the three
branches clearly indicate the intention that all the three branches
are joint and they are purchasing the properties in the name of
all the three branches. After the death of Rangasamy in the year
1967, it was defendant No.1, who took the reins of the family
being the eldest. The plaintiff and defendant No.10, sons of
Ranagasamy were very young at the time when their father died
and thereafter they were under the guidance and control of D-1
and the materials on the record indicate that it was D-1 under
whose guidance, all businesses were carried out. Even the Suit
No.37 of 1984 which was filed for partition of properties was at
the instance of defendant No.1, which pleadings have been made
by the plaintiff of that suit when he filed written statement in Suit
No. 1101 of 1987. The plaintiff of Suit No.37 of 1984, D-6 in his
written statement in Suit No. 1101 of 1987 has clearly stated that
he filed the Suit No.37 of 1984 at the instance of defendant No.1,
which fact has also been noted in paragraph 9 of the trial court's
judgment. [Para 86][380-C-F]
3.3 In suit No.1101 of 1987, it was only D-1, who filed the
written statement and appeared in the witness box. D-4 neither
filed written statement nor came to the witness box. It was D-1
who was pleading that joint family came to the an end after partition
dated 07.11.1960. D-1 in his written statement and in his oral
statement before the court has come up with the case that there
was partition of the properties on 08.03.1981 and an agreement
was entered between the three branches and compromise decree
dated 06.08.1984 was passed to implement the agreement which
was entered in the year 1981. [Para 87][380-G-H; 381-A]
3.4 The agreement dated 08.03.1981 was denied by the
plaintiff. The plaintiff's case was that at no point of time, there
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was any agreement entered between parties in the year 1981 to
divide the properties standing in the names of three branches.
The agreement dated 08.03.1981 was not filed by D-1 in the
evidence. The agreement was not filed nor exhibited by the
defendant, D-1. In the written statement which was filed by D-1
in O.S. No.37 of 1984, no plea was taken regarding agreement
dated 08.03.1981. It was for the first time in the written statement
filed by D-1 in suit No.1101 of 1987 that mention of agreement
dated 08.03.1981 was made. Neither any agreement dated
08.03.1981 was filed or proved nor there is any other evidence
on record to prove the division of properties between three
branches in the year 1981. [Paras 91, 92][382-G-H; 383-A-B]
3.5 It is the case of the defendant No.1 that the compromise
decree dated 06.08.1984 is nothing but implementation of
agreement dated 08.03.1981. It is, thus, clear that the case of D1 is that there was partition of all properties standing in the names
of three branches and allocated to different branches on
08.03.1981, which has been subsequently implemented by
consent decree dated 06.08.1984. As per the case of defendant,
the Vasudeva Textiles Mills was given to the branch of
Rangasamy, property at Coonoor was taken by D1 and properties
at Somnur by D-4. [Para 93][383-B-C]
3.6 When the D-1 comes with the case that there was
partition on 08.03.1981 of all immovable properties standing in
the names of three branches, which was implemented on
06.08.1984, the conclusion is irresistible that family was joint and
had the three branches were not part of joint Hindu family, there
was no occasion for attempting any partition on 08.03.1981 as
claimed by D-1. The fact that defendant No.1 is coming with the
case that there was partition on 18.03.1981 itself proves that three
branches were joint till then as per case of D-1 himself. [Para
94][383-D-E]
3.7 Plaintiff never admitted the agreement dated 08.03.1981
or alleged partition of 08.03.1981, it is, thus, clear that parties
remained joint and properties standing in the names of three
branches remained joint till the consent decree was passed on
06.08.1984. Thus, in the year 1979 when residential property of
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Tatabad was obtained in the name of defendant No.1, all three
branches were part of the joint Hindu family and the house
property purchased in the name of one member of joint Hindu
family was for the benefit of all. Both the Courts below although
accepted the partition dated 18.03.1981 as pleaded by D-1 but
erred in not considering the consequence of such pleading. When
partition of all immovable and movable properties is claimed on
08.03.1981, the conclusion is irresistible that the family was joined
till then. The theory set up by D-1 that all the three branches
were separate after 07.11.1960 is denied/belied by claim of
partition on 08.03.1981.[Paras 95, 96, 97][383-E-H]
3.8 Both the trial court and High Court have given much
emphasis on the fact that three branches were filing separate
Income-Tax Returns and Wealth Tax Returns after 1967. An
individual member of joint Hindu Family can very well file his
separate Returns both under the Income Tax Act as well as Wealth
Tax Act and filing of such Returns was not conclusive of status of
the family. The plaintiff's case throughout was that family
continued to be joint after 07.11.1960 and D-1 who alone had
filed the written statement and appeared in the witness box having
come with the case of partition on 08.03.1981 which he claims to
be implemented on 06.08.1984 by Compromise Decree, it is
proved that family was joint at least till then, i.e., 08.03.1981
or 06.08.1984. Thus, in the year 1979, when the Tatabad
residential property was acquired, the three branches were joint.
[Para 98][384-A-C]
3.12 The Tatabad residential property was for the benefit
of all the three branches which is further proved from the fact
that the consideration for the said amount was not paid by DW-1
from his separate account or in cash. The amount was drawn from
the private limited company Swamy and Swamy Plantation Private
Limited in which all the three branches were shareholders and
Directors. The Swamy and Swamy Plantation Company had not
purchased the residential property at Tatabad for the company.
The Swamy and Swamy plantation private company is not the owner
of the residential property and the residential property at Tatabad
is a joint family property for the benefit of all the three branches.
[Para 99][384-C-E]
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5. All three branches have equal share in the Tatabad
residential property, i.e., Item No.X of Schedule 'B' of plaint in
Original Suit No.1101 of 1987. This residential property being
not a part of O.S.No.37 of 1984, there is no bar in seeking partition
of the said property by the plaintiff. Accordingly, plaintiff/defendant
No.7, defendant No.1 and defendant No.4 are entitled to 1/3rd
share jointly in the aforesaid Item No.X of Schedule 'B' of the
suit property. [Para 100][384-E-G]
Case Law Reference
[1992] 3 Suppl. SCR 524
relied on
Para 49
[2006] 3 Suppl. SCR 370
relied on
Para 51
[2014] 14 SCR 535
relied on
Para 52
(2020) 6 SCC 629
relied on
Para 54
AIR 1925 PC 49
referred to
Para 79
[1962] 3 SCR 440
referred to
Para 83
[1996] 9 Suppl. SCR 338
referred to
Para 84
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1537
of 2016
From the Judgment and Order dated 23.11.2011 of the High Court
of Judicature of Madras in A.S. No.281 of 2000.
With
Civil appeal no. 1538 of 2016
V. Giri, Sr. Adv., Gaurav Agrawal, S. Ravi Shankar, Vikas Mehta,
Varun Singh, Ms. Ankita Gupta, Advs. for the Appellant.
Kapil Sibal, S. Nagamuthu,V. Giri, Sr. Advs., Ms. Shobha
Ramamoorthy, Arunabh Chowdhury, Ankur Chawla, Ms. Pallavi Langar,
Arun Mohan, Nizam Pasha, R. K. Mohit Gupta, Karthik, V. P.
Sengottuvel, S. Ravi Shankar, Ms. Yamunah Nachiar, K. R. Nishanth,
Akshay Kumar A.,Vikas Mehta, Varun Singh, Ms. Ankita Gupta,
Mrs. Prabha Swami, K.V. Mohan, Rahul Pratap, Advs. for the
Respondents.
R. JANAKIAMMAL v. S.K. KUMARASAMY(DECEASED) THROUGH
LEGAL REPRESENTATIVES
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The Judgment of the Court was delivered by
ASHOK BHUSHAN, J.
These two appeals have been filed challenging the Division Bench
judgment dated 23.11.2011 of Madras High Court dismissing the A.S.
No.281 of 2000 and A.S. No.332 of 1999 filed by the appellants
respectively. The parties shall be referred to as described in O.S.No.1101
of 1987 (S.R. Somasundaram vs. S.K. Kumarasamy). The appellant, R.
Janakiammal in C.A.No.1537 of 2016 was defendant No.7 in O.S.No.1101
of 1987 whereas S.R. Somasundaram, appellant in C.A.No.1538 of 2016
was the plaintiff in O.S.No.1101 of 1987. Janakiammal is the mother of
Somasundaram. Relevant facts and events necessary to decide these
two appeals are:
2. The parties came from Pattanam, Coimbatore District, Tamil
Nadu. We may notice the Genealogical Tree of the family which is to
the following effect:
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3. The plaintiff, S.R. Somasundaram and his mother, Janakiammal
who are the appellants in these two appeals belong to branch of
Rangasamy Gounder whereas other two branches are of S.K.
Kumarasamy,D-1 and S.K. Chinnasamy,D-4. Three brothers with their
father A.V. Kandasamy Gounder were residing as a joint family in
ancestral house at Sadapalayam Hemlet, Karumathampatti Village,
Palladam Taluka, District Coimbatore. Rangasamy and others received
a land measuring 86.72 acres by partition deed executed on 27.09.1953
between late A.V. Kandasamy Gounder and Ponnammal, junior wife of
Kandasamy Gounder, his first wife, Senniamalai, son of Kandasamy
Gounder from first wife, Rangasamy Gounder, S.K. Kumarasamy, S.K.
Chinnasamy, all sons of second wife of Kandasamy.
4. These appeals are concerned with three branches, namely,
Rangasamy, Kumarasamy and Chinnasamy. In the year 1954-55, three
brothers purchased various properties and started rice mill business called
Laxmi Rice Mills and also started Swamy Textiles in 1976, a match
factory, a slate factory, saw mills, timber business and power loom out
of joint family funds. On 07.11.1960 a partition deed was registered
between three brothers with respect to the properties allotted to them as
per registered partition deed dated 27.09.1953 along with the properties
purchased by three brothers in the ratio of 1/3rd each. Even after partition,
three brothers continued to live under the same roof and carried on
business as partners. In the year 1963 they purchased housing site by
sale deed dated 16.10.1963 in Somanur Hemlet, Village Karumathampatti,
and constructed a house therein and all the three brothers started living
in Somanur house from the year 1964 and carried on their different joint
business. On 27.05.1967, Rangasamy Gounder died in a road accident
leaving behind his widow, Janakiammal, two sons, S.R. Somasundaram,
S.R. Shanmugavelayutham and one daughter, S.Saraswathy. From 1968
to 1978 various properties were purchased in the name of three branches.
The family also purchased in the year 1972 Tea Estate known as High
Field Estate in the name of defendant Nos.1, 4, 10 and plaintiff. A Private
Limited Company known as Swamy and Swamy Plantations (P) Ltd.
was also promoted with family members being shareholders and
Directors.
5. In the year 1975, 50 acres of lands were purchased in Vedapatti
village, in the name of defendant Nos.1, 4, 10 and plaintiff. In the year
1978 a palatial Bungalow was purchased in Tatabad, Coimbatore.
Defendant No.10, who was Captain in the Indian Army, came back to
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Coimbatore after leaving his job to look after the family business and
properties. From the year 1973, he started looking after the properties at
Coonoor. Somasundaram, the plaintiff started his studies at Coimbatore
and Chennai and after completing his studies came back to Coimbatore
in the year 1979.
6. In Coimbatore one Vasudeva Industries Ltd., which was in
liquidation since 1967 was taken on lease from official liquidator of
Madras High Court by one Shroff, who along with defendant No.4, S.K.
Chinnasamy formed a partnership firm to run Vasudeva Industries Ltd.
Defendant No.1, S.K. Kumarasamy was appointed as General Manager
to look after the affairs of Vasudeva Industries Limited. An application
was filed in the year 1981 in Company Petition No.39 of 1956. Defendant
No.1, S.K. Kumarasamy filed an affidavit in support of Company
Application No.320 of 1981 praying that liquidation proceedings be closed.
On 30.04.1981, the High Court of Madras passed order directing
convening of a meeting of the creditors. In the meeting of creditors a
draft scheme submitted was approved on 09.06.1981, Madras High Court
passed an order on 22.01.1982 allowed the application filed by defendant
No.1, permanently stayed the liquidation proceedings and permitted
running of Vasudeva Industries Ltd. by the Board of Directors. On
03.02.1982 a Resolution was passed to bring the mills under the control
of the Board of Directors, including the plaintiff, defendant Nos.1, 4 and
10. The name of Vasudeva Industries Ltd. was changed to Vasudeva
Textiles Mills. In the year 1983 Vasudeva Textiles Mills( hereinafter
referred to as "Mills") obtained loan from Punjab National Bank in which
personal guarantee was also given by the plaintiff and defendant No.10,
who were Directors. The plaintiff and defendant No.10 were also in the
year 1984 elected as Managing Directors. The Swamy & Swamy Co.
which was earlier running the Mill on lease was dissolved in the year
1984. The Mills although started running by the Board of Directors but
in the years 1983, 1984 and 1985 accumulated losses were more than
the profit of Mills.
7. On 19.01.1984, C. Senthil Kumaravel, defendant No.6 and son
of S.K. Chinnasami, defendant No.4 filed O.S. No.37 of 1984 praying,
inter alia, for partition and allotment of 1/6th share to him. In O.S.No.37
of 1984 Senthil Kumaravel, the plaintiff came with the case that the
plaintiff and defendant Nos.1, 3,4, 8,9 and 10 were members of joint
family. In O.S.No.37 of 1984, Janakiammal was impleaded as defendant
No.8, Shanmugavelayutham as defendant No.9, Somasundaram as
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defendant No.10 and Saraswathi as defendant No.11. In the plaint case,
it was stated that even after registered partition deed dated 07.11.1960
between three branches, defendant Nos.1, 4 and the deceased K.
Rangasami continued to live jointly and did business jointly. All the three
branches lived jointly. In the plaint, it was further stated that from the
savings of the income and by mortgaging ancestral property, the capital
necessary for the business was found and the business was expanded
from time to time. It was further pleaded that plaintiff, Senthil Kumaravel
was entitled to 1/6th share. Defendant Nos.8 to 11, representing the
branch of deceased K. Rangasami, were entitled jointly 1/3rd share in
all suit properties. The plaintiff in suit had prayed following reliefs:
"a)
to divide the immovable suit properties described in the
schedules 'B', 'D' and 'E' and items 1 to 9 in Schedule 'C'
hereunder into six equal shares by metes and bounds with
reference to good and bad soil and allot one such share to
him with separate possession;
b)
to allot 1/6th share in the shares mentioned in item 10 and
11 of Schedule 'C' and item 2 of Schedule 'D' described
hereunder;
c)
directing the defendants to pay cost of the suit;"
8. The plaint Schedule 'B' included ancestral land in Palladam
and Samalapuram villages with house at Sadapalayam Helmet. Schedule
'C' included various immovable properties and included residential
building, shares in M/s. Swamy and Swamy Plantations (P) Ltd. Coonoor,
and shares of M/s. Vasudeva Industries Ltd. were also mentioned as
item Nos. 10 and 11 of Scheduled 'C'. In the above suit only defendant
Nos.1 to 3 of the suit, namely, S.K. Kumarasamy, Sundarambal, wife of
S.K. Kumarasamy and minor Kandavadivel son of S.K. Kumarasamy
filed their written statements. In the written statement, it was pleaded
that no doubt some properties have been acquired jointly in the names of
the defendant Nos.1, 3, 4,9 and 10, but they must be deemed to be only
co-sharers in respect of those properties. It was pleaded that three
branches were allotted shares in 1960 partition and plaint case that parties
continued to live jointly was denied.
9. In O.S.No.37 of 1984, an application under Order XXIII Rule
3 was filed on 06.08.1984 by the plaintiff containing signatures of plaintiff
and defendants. In the application under Order XXIII Rule 3 in Schedule
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'A' to Schedule 'J', various items of properties were listed and allocated
to different members of the family. On the basis of application under
Order XXIII Rule 3, Sub-ordinate Judge, Coimbatore passed an order
dated 6.8.1984 and directed for preparation of decree on the basis of
compromise petition.
10. In the compromise decree although various agricultural
properties, house properties and shares were allotted to two other
branches, i.e., branches of S.K. Kumarasamy and S.K. Chinnasamy
but the branch of Rangasamy was allocated only shares in Vasudeva
Industries which was under liquidation and taken under the orders of
Madras High Court dated 21.01.1982 to be run by the Board of Directors.
11. Minor children of defendant No.10 filed O.S.No. 827 of 1987
through their mother challenging the compromise decree dated
06.08.1984 on the ground that they were not parties thereto. On
03.08.1987 O.S. No.1101 of 1987 was filed by both the sons of
Rangasamy, i.e., S.R. Shanmugnavelayutham and S.R. Somasundaram.
In O.S. No.1101 of 1987 defendant Nos.1,2 and 3 filed their written
statements where it was pleaded that there was agreement on 08.03.1981
between the three branches where defendant No.1 was to pay Rs. 4
lacs to defendant No.4 and plaintiff was to pay Rs. 7 lacs to defendant
No.4 and since payment was not made to defendant No.4 suit was filed
through his son. It was further pleaded that compromise dated 06.08.1984
was to give effect to earlier agreement dated 08.03.1981. In the O.S.
No.827 of 1987, an affidavit was filed by the mother of the minor stating
that they had entered into the compromise with defendant No.1 hence
seeking permission to withdraw the suit. On 10.02.1993, the O.S. No.827
of 1987 was withdrawn, on the same date Shanmugavelayuthem who
was the first plaintiff in O.S.No.1101 of 1987 withdrew himself from the
suit and was transposed as defendant No.10 in the suit. The written
statement was filed by Janakiammal, defendant No.8 supporting the
plaintiff's case and also praying for partition of her share. Senthil
Kumaravel, who was plaintiff in Suit No.37 of 1984, filed a written
statement in O.S.No.1101 of 1987 where he stated that he filed Suit
No.37 of 1984 at the instance of S.K. Kumarasamy, defendant No.1
and decree dated 06.08.1984 was sham and nominal, and was not to be
given effect to. Additional written statements were filed by defendant
Nos.1 to 3. Defendant No.10 also filed written statement supporting the
case of defendant No.1. Reply was filed by plaintiff, Somasundaram to
the written statements filed by defendant Nos. 1 to 3.
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12. Five witnesses were examined on behalf of the plaintiff.
Somasundaram, plaintiff appeared as PW.1. The plaintiff filed Exhs. A1 to A-55. On the side of defendants, four witnesses were examined.
Janakiammal appeared as DW.2 whereas S.K. Kumarasamy appeared
as DW.1. Exh.B-1 to B-104 were marked on behalf of the defendants.
Exh. X-I to X-27 have been marked through witnesses.
13. The trial court framed five issues and six additional issues.
One of the additional issues was that whether the suit is not maintainable
under Order XXIII Rule 3A of the CPC. The trial court vide its judgment
dated 30.09.1997 dismissed the suit. The trial court upheld the plea of
defendant Nos.1 to 3 that O.S.No.1101 of 1987 was barred by Order
XXIII Rule 3A CPC. The trial court also upheld the partition deed dated
07.11.1960 and the agreement dated 08.03.1981. The trial court held
that after the year 1960 the entire family was not living as joint family
and all the three branches are co-owners as far as properties are
concerned and were running partnership businesses. Challenging the
judgment of the trial court dismissing the suit two appeals were filed in
the High Court. A.S.No.332 of 1999 was filed by Somasundaram, the
plaintiff and A.S. No.281 of 2000 was filed by Janakiammal defendant
No.8.
14. The High Court has noticed the point for determination in the
appeal, i.e., whether O.S.No.1101 of 1987 is maintainable in the light of
the provisions contained in Order XXIII Rule 3A of the CPC. The High
Court, however, observed that appeals could be disposed of according
to the finding to be recorded on the aforesaid point for consideration,
however, it has not formulated any other point for consideration though
extensive arguments have been made by the respective counsel. It is
useful to reproduce paragraphs 163 and 164 of the judgment of the High
Court, which are to the following effect:
"163. The point for determination that arises for consideration
in the above appeals is as to whether the suit seeking to declare
the decree passed in O.S.No.37 of 1984 on the file of the Sub
Court, Coimbatore, is sham and nominal, ultra-vires, collusive,
unsustainable, invalid, unenforceable and not binding on the plaintiff,
is maintainable in the light of the provisions contained in Order 23
Rule 3 of the CPC and Order 23 Rule 3-A of the CPC?
164. As the appeals could be disposed of on the basis of the finding
to be recorded on the aforesaid point for determination, we have not
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formulated any other point for determination, though extensive arguments
have been made by the respective counsel as to whether the partition
effected under Ex.B-26, dated 07.11.1960 between Rangaswamy (father
of the plaintiff), Kumaraswamy (D-1) and Chinnaswamy (D-4) was
acted upon or not; whether there was a joint family among the three
branches after 07.11.1960; whether the various businesses run under
different partnership firms are the joint family businesses."
15. The High Court after considering the submissions of the
respective counsel came to the conclusion that compromise decree dated
06.08.1984 in Suit No.37 of 1984 was valid, the plaintiff failed to prove
that any fraud was played. The plaintiff, further, failed to prove that they
gave any guarantee in the year 1984 for taking loan from Punjab National
Bank. Hence, basis of the suit that they signed the compromise deed on
the representation of defendant No.1 and that the plaintiff and defendant
having given personal guarantee for loan obtained for Vasudeva Industries
Ltd., to save family properties from claim of the Bank, the properties be
kept only in the name of defendant No.1 and defendant No.4 but the
right of the plaintiff and defendants will be held intact.
16. The High Court held that it has not been proved that any
personal guarantee was given by the plaintiff, the very groundpleaded
by the plaintiff is knocked out.