# T. S. SWAMINATHAUDAYAR v. THE OFFICIAL RECEIVER OF WEST TANJORE

- **Citation:** [1957] 1 S.C.R. 775
- **Court:** Supreme Court of India
- **Decided:** 1957
- **Case number:** Civil Apppeals Nos. 251 to 253 of 1953
- **Bench:** Bhagwati, jAFER IMAM, A. K. Sarkar
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/t-s-swaminathaudayar-v-the-official-receiver-of-west-tanjore-1373
- **Pages:** 26

## Headnote

Partitior Suit-Decree for owelty-Absence
of express declaration of
charge-Charge, if created
by
necessary
implicationPriority.
Per
BHAGWATI and IMAM JJ. A decree for paymmt of
owelty money by one co-sharer to ancther in a Partition suit,
even where it does not expressly declarf' a charge, create3 one by
necessary implication in favour of the latter or the
property
allotted to the former and such' charge on lien has precedence
over prior mortgagees of such property.
Shaheb:::,ada Mohammed Kazim Shah v. R. S. Hill, I.L.R. ( 1907)
35 Cal. 388 and Poovanalingam Servai v. Veerai, A.LR. ( 1926)
Mad. 166, referred to.
Consequently, in a case where the final d;:cree in a Partition
Suit passed by the High Court in appeal provided for payment of
owelty money by .one co-sharer to another an(l. at the instance of
the Official Receiver in Insolvency, in whom the estate of the
former had vested, instead of expressly declaring a charge authorised him to pay the owelty from out of the oale proceeds of the
p1operty, the judgment-credito1· of the co-sharer liable for owelty
in 1espect of decrees previously obtained by him could claim no
priority and the High Court, taking an etroneous view of the law
and relying on a previous judgment of that Court passed in the
<:reditor's appeals, set aside in appeals preferred by the Official
Receiver the order$ of the District Judge refusing his applications
for refund of sale-proceeds deposited in Court to the credit of the
decree-holder co-sharer and for restitution under s. 144 of the
Code of Civil Procedure of the monies actually paid to him under
the partition decree, the orders of the High Court must be set
aside.
Per SARKAR J. Whether the fir.al decree had or had not
crf'ated a charge over the insolvent's share for such sums as it
directed the
Receiver in insolvency to pay to the co-sharer that
could not affect the Receiver's liability to pay thereunder and
while the decree subsisted he was not entitled to claim restitution
of such monies ai he had p:i.id in terms thereof on the ground
that no charge had been created nor any other claim to priority
existed.
The rights of the co-sharer decree-holder who had obtained
the decree against the Receiver himself stood on a diffuent
footing from those of a creditor of the insolvent and he
could
not, like the latteF, be compelled to accept a dividend on the
distribution of the insolvent's assets.
1957
March 27.
1957
T. S. Swaminatha~
udayar
v.
Th• Oj/idal
Rtceiver of
W ul T anjoT1
Bhagwati].
SUPREME COURT REPORTS
[1957]
C1v1L APPELLATE JuRISDICTJON : Civil Apppeals
Nos. 251 to 253 of 1953.
Appeal from the judgment and order dated February
8, 1950, of the Madras High Court in A.A.O. Nos.
724 to 726 of 1945 preferred against the orders dated
July 14, 1945, of the Court of the District Judge, West
Tanjore in E.P. No. 35 of 1944 and E.A. Nos. 195
and 182
of 1944 respectively in E.P. 15 of 1940
in O.S. No. 22 of 1934 cin the file of the Court of SubJudge, Kumbakonam.
N. S.
Chonpakesa
Aryangar and S. Subramanian,.
for the appellant.
The respondent did not appear.
1957. March 27. The Judgment of the Court was
delivered by
BHAGWATI ].-These appeals with certificates of
fitness under art.
133 of the Constitution raise an
interesting question as to the equities arising out of a
partition between the erstwhile members of a joint
family.
A suit for partition of the properties belonging to a
well known Odayar family in the ·West Tanjore District
was filed in the Court of the Subordinate Judge of
Kumbakonam (being Original Suit No. 22 of 1924).
Amongst the par•ies to that suit were defendants Nos.
3 and 6, Balaguruswami Odayar and Swaminatha
Odayar respectively, the former of whom is tbe natural
father of the latter, who went by adoptio1i into another
branch of the family.
Defendant No. 6 was entitled
to a 4/ r 5th share and defendant No. 3 was entitled to
a 2/15th share in the prope1 ties belonging to the.joint
family.
A preliminary decree for partition was passed
on Octo

## Text

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S.C.R.
SUPREME COURT REPORTS
775
T. S. SWAMINATHAUDAYAR
v.
THE OFFICIAL RECEIVER OF WEST TANJORE.
(BHAGWATI, jAFER IMAM and A. K. SARKAR JJ.)
Partitior Suit-Decree for owelty-Absence
of express declaration of
charge-Charge, if created
by
necessary
implicationPriority.
Per
BHAGWATI and IMAM JJ. A decree for paymmt of
owelty money by one co-sharer to ancther in a Partition suit,
even where it does not expressly declarf' a charge, create3 one by
necessary implication in favour of the latter or the
property
allotted to the former and such' charge on lien has precedence
over prior mortgagees of such property.
Shaheb:::,ada Mohammed Kazim Shah v. R. S. Hill, I.L.R. ( 1907)
35 Cal. 388 and Poovanalingam Servai v. Veerai, A.LR. ( 1926)
Mad. 166, referred to.
Consequently, in a case where the final d;:cree in a Partition
Suit passed by the High Court in appeal provided for payment of
owelty money by .one co-sharer to another an(l. at the instance of
the Official Receiver in Insolvency, in whom the estate of the
former had vested, instead of expressly declaring a charge authorised him to pay the owelty from out of the oale proceeds of the
p1operty, the judgment-credito1· of the co-sharer liable for owelty
in 1espect of decrees previously obtained by him could claim no
priority and the High Court, taking an etroneous view of the law
and relying on a previous judgment of that Court passed in the
<:reditor's appeals, set aside in appeals preferred by the Official
Receiver the order$ of the District Judge refusing his applications
for refund of sale-proceeds deposited in Court to the credit of the
decree-holder co-sharer and for restitution under s. 144 of the
Code of Civil Procedure of the monies actually paid to him under
the partition decree, the orders of the High Court must be set
aside.
Per SARKAR J. Whether the fir.al decree had or had not
crf'ated a charge over the insolvent's share for such sums as it
directed the
Receiver in insolvency to pay to the co-sharer that
could not affect the Receiver's liability to pay thereunder and
while the decree subsisted he was not entitled to claim restitution
of such monies ai he had p:i.id in terms thereof on the ground
that no charge had been created nor any other claim to priority
existed.
The rights of the co-sharer decree-holder who had obtained
the decree against the Receiver himself stood on a diffuent
footing from those of a creditor of the insolvent and he
could
not, like the latteF, be compelled to accept a dividend on the
distribution of the insolvent's assets.
1957
March 27.
1957
T. S. Swaminatha~
udayar
v.
Th• Oj/idal
Rtceiver of
W ul T anjoT1
Bhagwati].
SUPREME COURT REPORTS
[1957]
C1v1L APPELLATE JuRISDICTJON : Civil Apppeals
Nos. 251 to 253 of 1953.
Appeal from the judgment and order dated February
8, 1950, of the Madras High Court in A.A.O. Nos.
724 to 726 of 1945 preferred against the orders dated
July 14, 1945, of the Court of the District Judge, West
Tanjore in E.P. No. 35 of 1944 and E.A. Nos. 195
and 182
of 1944 respectively in E.P. 15 of 1940
in O.S. No. 22 of 1934 cin the file of the Court of SubJudge, Kumbakonam.
N. S.
Chonpakesa
Aryangar and S. Subramanian,.
for the appellant.
The respondent did not appear.
1957. March 27. The Judgment of the Court was
delivered by
BHAGWATI ].-These appeals with certificates of
fitness under art.
133 of the Constitution raise an
interesting question as to the equities arising out of a
partition between the erstwhile members of a joint
family.
A suit for partition of the properties belonging to a
well known Odayar family in the ·West Tanjore District
was filed in the Court of the Subordinate Judge of
Kumbakonam (being Original Suit No. 22 of 1924).
Amongst the par•ies to that suit were defendants Nos.
3 and 6, Balaguruswami Odayar and Swaminatha
Odayar respectively, the former of whom is tbe natural
father of the latter, who went by adoptio1i into another
branch of the family.
Defendant No. 6 was entitled
to a 4/ r 5th share and defendant No. 3 was entitled to
a 2/15th share in the prope1 ties belonging to the.joint
family.
A preliminary decree for partition was passed
on October 25, 1924.
The defendant No. 3 became
insoh·ent during the pendency of an appeal which was
taken against that preliminary decree.
The Official
Receiver of West Tanjore who represented the branch
of the 3rd Defendant was impleaded as a party to the
suit on February 12, 1929.
The final decree for partition was passed on September 26, 1932, by the Subordinate Court at Kumbakonam. Defendant No. 6 carried
-
S.C.R.
SUPREME COURT REPORTS
777
an appeal to the High Court of Judicature at Madras
being A S. No. 60 of 1933
and the High
Court
ultimately passed a final decree on May 9, 1938.
Under the terms of this decree certain properties fell
to the share of the 3rd Defendant's branch . and for the
purpose of equalising on partition the Official Receiver
of West Tanjore, representing the 3rd Defendant's
branch was ordered to pay a sum of Rs. 24,257-0-8 to
the. Defendant No. 6. This amount was to carry
interest at 6 per cent. per annum from September 26,
1932, and there were various adjustments ordered
inter se.
It was further ordered that the Official
Receiver of West Tanjore in whom the estate of the
3rd Defendant's branch was vested shoufd sell such
portions of the estate as were not subject to the charge
for the maintenance of the 9th Defendant in order to
pay off the amounts decreed to be paid by the third
Defendant and should make payments on behalf of
the 3rd Defendant's branch in accordance with the
judgment therein.
The last direction was given by the High Court in
C.M.P. No. 5697 of 1939 substituting the words "be at
liberty" in paragraph 4(b) of the decree in AS. No. 60
of 1933 by the words "be directed" and incorporating
the words "third Defendant's Branch" wherever the
words "third Defendant" had been used in that
paragraph. The occasion for the giving
of this
direction was that after the final decree for partition
had been passed by the High Court on May 9, 1938,
the parties applied to the High Court to give directions
for working out their rights inter se.
When these
directions came to be given the Official Receiver of
''\Test Tanjore was present in Court and stated to the
Court that he had no objection to sell such portions of
the estate as would be sufficient to pay off the amount
declared due by the third Defendant's branch to the
Defendant No. 6. It was in pursuance of such statement made by the Official Receiver of West Tanjore
that the High Court did not declare a charge on the
properties which had fallen to the share of the thitd
100
1957
T. S. Swaminatha·
udtflar
v.
The Official
JRtceiver of
West T anjort
rLBhagwatiJ.
1957
T. S. Swaminatha~
udayar
v.
The Official
&:eiver of
West T anjore
Bhacwati].
SUPREME COURT REPORTS
r 19s7J
Defendant's branch (as it was originally contemplated
in the judgment) for the amount of Rs. 24,257-0-8.
The Official Receiver of \Vest Tanjore had in the
meanwhile sold on July 5, 1935,
certain items of
properties which had fallen to the share of the 3rd
Defendant's branch and realised a sum of Rs. 8,250. On
January 25, 1940. the Defendant i\o. 6 who is the
appellant before us filed a petition under 0. 2 r r. r 1
Sub-r. (2) of the Civii Procedure Code being E.P. No.
15 of l 940 praying tllat the Court shuuld direct the
Official Receiver of \Ves~ Tanjore representing the 3rd
Defendant's !:Jranch (the respondent before us) to pay
to him or to deposit into court Rs. 8,250 for the
realization of Rs. 36,983-9-6 which was the amount
due to him from the third Defendant's branch inclusive
of interest as per the decree of the High Court dated
May 9, 1938, in A.S. No. 60 of 1933. The respondent
did not oppose this claim of the appellant at that
stage. Two
other
decree-holders,
one Thinnappa
Chettiar and the other Palaniappa Chettiar had
obtained decrees against Defendant No. 3 and Defendant No. 4 on promissory notes executed by the latter
on date March 14, 1925 the decree in favour of Thinnappa Chettiar being dated August 15, 1929, and that
in favour of Palaniappa Chet'tiar being dated July l 7,
1928. On July 3, 1935, Thinnappa Chettiar filed a
petition under 0. 29. r. l 1 (2) 54, 62, 66, of the Civil
Procedure Code being E. P. No. 25 of 1935 praying for
the realisation of Rs. 35,224-2-6 by attachment and
sale of immovable properties belonging to his judgment-debtor. On July 4, 1935, he attached the
shares of the sons of the Defendant No. 3 and Defendant No. 4 in these immovable properties but in so
far as the attachment was not levied the sales effected
by the respondent on July 5, 1935, of the properties
falling to the share of the third Defendant's branch
were upheld.
On September 30, 1935, Thinnappa
Chettiar filed an application being E.A. No. 376 of
1935 under section 151 of the Civil Procedure Code
praying that a sum of Rs. 6,600 realised after the
order of attachment obtained by him as aforesaid be
sent for from the respondent and paid to him by means
S.C.R.
SUPREME COURT REPORTS
779
195i
of a cheque. E. P. No. 25 of 1935 and E.A. No .. 376 of
1 935 were dismissed by the District Judge on August T. s. Swaminatha14, 1937. Thinnappa Chettiar filed A.A.O. Nos. 349 &
udayar
350 of 1937 against these orders of the Dist. Judge
The Official
and on August ro, 1939, the High Court holding that
Receiver of
the leave of the Insolvency Court was not necessary
before these proceedings in execution had been taken,
remanded both E.P. No. 25 of 1935 and E.A. No. 376
of 1935 to the District Court for disposal according to
law.
The learned District Judge, in order to avoid
conflict of decisions and to save difficulties of multiplicity of proceedings allowed the appellant to be
made a party in E.P. No. 25 of 1935 and
E. A.
No. 376 of 1935 and Thinnappa Chettiar was made
a party to the proceedings in E.P. No. 15 of 1940.
The learned District Judge passed a comprehensive
order in all these three matters, viz., E.P. No. 25 of 1935,
E.A. No. 376 of 1935 and E.P. No. 15 of 1940 which
came up for hearing before him.
He held that even
though the word charge, as such had not been
used in the High Court's decree in A.S. No. 60
of 1933, the directions given by the High Court
to the respondent, under the circumstances of the
case, created a charge on the properties which
fell to the share of the third Defendant's branch.
This was the basis of the petition which had been filed
by the appellant being E.P. No. 15 of 1940 and the
learned District Judge observe, "This direction must
be deemed to h<l'Ve been certainly made in favour of
the 6th Defendant in order to see that he 1s paid the
amount decreed in his favour by a Court Official who
had the possession of the properties and with such
guarantee the High Court probably thought that it
was quite unnecessary to expressly state that a charge
has been created over these properties."
The learned District Judge accordingly directed the
respondent to deposit into Court to the credit of E.P.
No. 15 of 1940 the sale proceeds in question, viz.,
Rs. 8,250, minus his legitimate expenses for payment
to the appellant.
E.A. No. 376 of 1935 was dismissed
with costs of the respondent and E.P. No. 25 of 1935
was adjourned to January 21, 1942, for further proWest T anjore
BhagwatiJ.
1957
T, S. Swaminatha·
udiJJ·ar
v.
T lu Official
Rtctiver of
Wtst T anjore
B!Jagwali].
SUPREME COURT REPORTS
[ 1957]
ceedings with regard to other lots of properties.
Thinnappa" Chettiar filed appeals against these orders
being A.A.O. Nos. 229, 429 and 483 of 1942 in the
High Court.
In the meanwhile, on January 9, 1942, the respondent deposited a sum of Rs. 5,200 in Court to the credit
of the appellant's decree. On February 5, 1940, the
learned District Judge made a further order allowing
the respondent to sell the properties which he was
directed to sell by the High Court's order dated May 9,
1938, in A.S. No. 60 of 1933, to pay the petitioner as
directed by the High Court notwithstanding the
attachment as was ordered in E.P. No. 25 of 1935 and
free of that attachment.
On May l 1, 1942, a sum of
Rs. 5,500 being the sale proceeds of certain properties
belonging to the share of the 3rd Defendant's branch
was ad.iusted by the appellant and on January 23,
1940, the respondent paid to the appellant a further
amount of Rs. 26,966 adjusting a
further sum of
Rs. 1 1 for costs due by the appellant.
The High Court disposed of the A.A.0. Nos. 229,
429 & .j.83 of 1942 on ~o,·cmber 5, r9+3. It held that
the procedure adopted by the learned District Judge
of im:1Ie.iding strangers as parties to the execution
petition and the execution applications before it could
not be supported and ordered that the appellant and
Thinnappa Chettiar should be deleted from the array,
of parties in E.P. No. 25 of 1935, E.A. No. 376 of
1935 and E.P. No. 15 of 1940.
It also held that no
charge was created by the decree dated May 9, 1 <138,
in A.S. No. 60 of 1933 in respect of the sum of
Rs. 2.i.,257-0-8 awarded to the appellant under the
decree. it obserYed that "It is clear from the language
used that the learned judges who disposed of A. S.
No. 60 of 1933 did not intend to create a charge and
the decree did not have the legal effect of creating a
charge."
In the result, the High Court ordered that
the name of Thinnappa Chettiar should be struck out
from the array of parties in E.P. No. 15 of 1940 and
the name of the appellant should be struck out from
the array of parties in E.P. No. 25 of 1935 and E.A.
No. 376 of 1935 and further ordered that all the three
I
S.C.R.
SUPREME COURT REPORTS
application! be remanded to the lower Court for
disposal on the merits in the light of the observations
contained in the order.
As a result of the decision of the High Court negativing the appellant's claim to priority, the respondent
field on July 29, 1944, E.A. No. 182 of 1944, praying
that the Court do issue a cheque for Rs. 5,200
deposited by him on January 9, 1942.
On the 7th
August, l 944, the appellant, in his turn, filed an Application being E.A. No. 195 of 1944 praying that the
Court do issue a cheque for Rs. 5,200 deposited by
the respondent as due to him under the decree dated
May 9, l 938.
\'\'hile these applications were pending,
the respondent filed a petition, being Execution P~ti
tion No. 35 of 1944, on September 27, 1944, under ss. 144
and l 5 l and 0. 2 l r. l l and 3 7 of the Ci vi! Procedure
Code praying that the Court do order payment by the
appellant to him of ( l) the sum of Rs. 5,200 deposited
by him in Court on January 8, 1942, and claimed' by
him in E.A. No. 182 of 1944; (2) sale proceeds adjusted
by the appellant on May l l, l 942, together with interest
thereon at 6 per cent. per annum from May l l, 1942,
aggregating to Rs. 6,283-12-0 ; (g) the amount paid
on June 23, 1942, by the appellant being Rs. 26,966
and !4) the amount adjusted by the respondent for
costs due by him on June 23, 1942, being Rs.
l l,
items 3 and 4 aggregating to Rs. 26,977 together with
interest thereon from June 23, I 942, up to date at 6
per cent. per annum amounting to Rs. 3, 722-13-6. Thus
he claimed a sum of Rs. 42,183-9-6 in the aggregate
from the appellant.
All these matters-E.A. No. 182 of 1944 and E.A.
No. 195 of 1944 and E.P. No. 35 of 1944 were heard by
the District Judge on July 14, 1945:
The learned
District Judge understood the order of the High Court
dated November 5, 1943, to mean that the claim of
the appellant to priority was still to be adjudicated
upon.
He stated that all that had been held by the
High Court was that the decree in A.S. No. 60 of 1933
did not have the legal effect of creating a charge in
favour of the appellant and the question whether the
appellant was not entitled to priority in respect of
1957
T. S. Swaminalhaudayar
v.
Tk Official
Rectiuer of
West Tanjor1
BhagwatiJ.
'
1957
T.S. Swaminatha-
~"'
v.
TM Oifo;ial
Receiver of
Wist T anjore
Bhagwati J.
SUPREME COURT REPORTS
[I 95 7 l
his claim was not concluded by that decision, since it
depended upon the circumstances and situation of
parties in the first litigation itself (i.e., O.S. No. 22 of
1924, Sub-Court, Kumbakonam and A.S. No.60of1933,
High Court) and the reasons which then led the Official
Receiver, who was present when the order was made
in A.S. No. 60 of 1933 to submit that "he was prepared
to sell such parts of the estate as might be necessary
for satisfying the decree passed in favour of the
appellant." On scrutinizing these facts, the learned
District Judge came to the conclusion that in respect
of the sums due to him under the partition decree,
directed to be paid from the estate of the third
Defendant's branch as equitable adjustment,
the
appellant had really a superior title and, assuming for
a moment that the direction related instead to a
specific item of immovable property, it was obvious
that such an item would not have formed part of the
estate in insolvency at all.
In the result he held
that the respondent was not entitled to restitution in
respect of the payments made and the appellant was
clearly entitled to such amounts, and also to the
amount then in deposit since the estate in insolvency
did not itself comprise these assets in the strict legal
sense.
The applications E.P. No. 35 of 1944 and
E.A. No. 182 of 1944 were accordingly dismissed.
E.A. No. 195 of 1944 was allowed and the appellant
was declared entitled to the amount deposited in
Court.
The respondent carried appeals to the High Court
against these orders of the District Judge being A.A.0.
Nos. 724, 725 and 726 of 1945. The High Court
appreciated the force of the arguments advanced
before it on behalf of the appellant but felt itself bound
by the construction put upon the judgment and decree
by the High Court on November 5, 1953, observing
that even if that construction were not strictly binding on it as a decision on a pure question of law in the
nature of a judicial precedent by another Division
Bench of that Court would undoubtedly be, it would
feel highly loath to deny it the respect to which it was
entitled at its hands in the interests of judicial comity, I
S.C.R.
SUPREME COURT REPORTS
whatever be the construction which it would have
imposed upon the same, had the question arise11 for
the first time before it. It, therefore, held that the
appellant was debarred by the principles of comtructive res-judicata from raising other grounds of priority
or preference after remand which had no relation to
the decree which was the basis of the E. P. No. 15 of
r 940.
The High Court also expressed the opinion
that even assuming there was no res-judicata in his
favour, the provisions of the Provincial Insolvency
Act being what they were, the .appellant could claim
no pi;iority if his position as a secured crediwr as
defined in s. (2) (e) of the Act could not be sustained.
A further argument was advanced before the High
Court and it was that a provision in a partition decree
for a mere payment by one co-sharer to another of a
sum of money for equalisation of shares per se constituted a charge· by operation of law over thr. share
allotted to the sharer made liable for the payment
without any creation of charge by the Court by express
language or necessary implication.
The High Court
refused tb entertain that argument in view· of the
conclusion reached by it as above and also negatived
the contention which was urged on behalf of the appellant before it that the provision for such payment in
the partition decree was
an
"owelty provision"
observing that all that was meant was equality and
all that the expression "owelty provision" in the
context implied was a provision for adjustment or
equalization of shares and no more.
The High Court
accordingly came to the conclusion that the respondent
was entitled to the restitution sought by him
and
allowed the appeals with costs before it and in the
Court below.
The order of the learned District Judge
was set aside, and E. P. No. 35 of 194.i and E. A. No.
182 of 1944 were allowed and E. A. No. 195 of 1944
was dismissed.
The appellant applied for and obtained from the
High Court certificates of fitness under Art.
I 33 of the
Constitution and that is hO\» these appeals are before us.
The principal question which arises for our determination in these appeals is what was the nature of.
5-99 s c. I. 59
1957
T. S. Swaminatha·
udayar
v.
The Official
Receiver of
West Tar!JOre
Bhagwati].
'
1957
T. S. Swaminathaudayar
v.
The Official.
Reuiver of
~
Tanjf1r6
,.IQ--
BhagwatiJ.
SUPREME COURT REPORTS
the rights acquired by the appellant in regard to the
payment of Rs. 24,257-0-8 and interest by the respon-.
dent as representing the 3rd Defendant's branch under Ythe terms of the decree dated May 9, 1938, in A.S. No.
60 of 1933.
It must be remembered that the decree was one for
parlilion of the properties belonging to the joint family
of which the Defendant No. 3 and the appellant were
coparceners. While effecting such a partition it would
not be possible to divide the properties by metes and
bounds, there being of necessity an allocation of
properties of unequal values amongst the members of
the joint family.
Properties of a larger value might
go to one member and properties of a smaller value tor--
another and, therefore, there would have to be an
adjustment of the values by providing for the payment
by the former to the latter by way of equalisation of
their shares.
This position has been recognized in law
and a provision for such payment is termed "a p~ovi
sion for
owelty or
equality of partition". The
following passage from Story on Equity (Third Edition)
page 277, para. 654, describes what happens on a
partition :-
"In regard to partitions, there was also another
distinct ground
upon
which
the jurisdiction of
courts of equity was maintainable, as it constituted a-y
part of its appropriate and peculiar remedial justice. ·
It is, that courts of equity were not restrained, as
courts of law were, to a mere partition or allotment of
the lands and other real estate between the parties
according to their respective interests in the same, and
having regard to the true value thereof ; but courts of
equity might, with a view to the more convenient and
perfect partition or allotment of the premises, decree
a pecuniary compensation to one of the parties for
owelty or equality of partition, so as to prevent an
injustice or avoidable inequality."
Lawrence on Equity Jurisprudence (1929), Vol. I-rPP· 1227, 1228, s. 1147, also contains the following
passage :-
"The ordinary method of partition is to decree
a physical severance of the separate interests, no sa
S.C.R.
SUPREME COURT REPORTS
being authorised unless a fair partition is otherwise
impossible, or at least prejudicial.
There was no
power of judicial sale at common law.
The Court
ordering physical partition may make its decree effective by compelling mutual conveyances by the parties
of their respective intt>rests.
Owelty of partition may
be awarded to equalize the shares of the parties, and
may be decreed to be a lien on the excessive allotment.
Though only when necessary to a fair partition, and it
should be employed as little as possible."
This position has been summarized in Freeman's
Cotenancy and Partition ( 1886 Edition) page 676,
para. 507, under the caption of "Owelty" :-
"Owilty" :-"When an equal partition cannot be
otherwise made, courts of equity may ortler that a
certain sum be paid by the party to whom the most
valuable property has been assigned.
The sum thus
directed to be paid to make the partition equal is
called "owelty". It is a lien on the property on
account of which it was granted.
"The law cannot
contemplate the injustice of taking property from one
person and giving it to another without an equivalent,
or a sufficient security for it." The lien for owelty
has precedence over prior mortgages and other liens
existing against the
cotenant
against whom the
owelty was awarded."
It is significant to note that this provision for owelty
is construed as a lien which the co-sharer who is
awarded owelty is deemed to acquire on an excessive
allotment of property to the other co-sharer.
Owelty
in general and lien therefor are thus described in
Corpus Juris Secundum, Vol. 68, s. 15 :-
"Section 15.
Owelty and Lien Therefor
(a) In General.
(b) Liens.
(a) In General.
The parties to a voluntary partition may agree to
pay owelty to equalise the shares allotted.
Owelty is the difference which is paid or secured
by one coparcener or co-tenant to another for the
purpose of equalizing a partition. The power to award
1957
T. S. SwaminathtJudayar
v.
The Oj/icial
Receiver of
West T anjor1
Bkagwati].
1957
T .S .. Swamfruitha·
udqJar
V,
The O./ficial
liectivtr of
W tJl T anjore
Bhagwati].
SUPREME COURT REPORTS
[1957 J
owelty has, from the earlier times, been regarded as
necessary to the act of partitioning property ; and the
parties to a voluntary partition may agree to
the
payment of owelty in order to equalize the shares
allotted ; and, where the matter of making the partition is delegated to commissioners, they have the
power to award owelty as a necessary incident to the
partition.
(b) Liens.
An agreement for owelty in a voluntary partition
of land ordinarily creates a lien or charge on the land.
An agreement for owelty ordinarily creates a lien
or charge on the land taken under the partition, and
this lien may exist because of an express agreement
between the parties providing for it or it may
be
implied in the absence of such express agreement."
It therefore follows that when an owelty is awarded
to a member on partition for equalization of the shares
on an excessive allotment of immovable properties to
another member of the joint family, such a provision
of owelty ordinarily creates a lien or a charge on the
land taken under the partition. A lien or a charge
may be created in express terms by the provisions of
the partition decree itself.' There would thus be the
creation of a legal charge in favour of the member to
whom such owelty is awarded.
If, however, no such
charge is created in express terms, even so the lien may
exist because it is implied by the very terms of the partition in the absence of an express provision in that
behalf.
The member to whom excessive allotment of
property has been made on such partition cannot claim
to acquire properties falling to his share irrespective of
or discharged from the obligation to pay owelty to the
other members.
What he gets for his share is, therefore,
the properties allotted to him subject to the obligation
to pay such owelty and there is imported by necessary
implication an obligation on his part to pay owelty
out of the properties allotted to his share and a corresponding lien in favour of the members to whom such
owelty is awarded on the properties which have fallen
to his share.
S.C.R.
SUPREME COURT REPORTS
Not only is this the normal position on a partition
decree where
there
is
an
unequal
distribution
of properties among the members of the joint
family but even where an encumbrance has been
created on a member's share before the partition is
effected, the encumbrancer is postponed to the member
to whom such owelty is awarded under the partition
decree.
A lien or a charge created in favour of a
member in regard to such owelty obtains precedence
over an encumbrance and there are authorities to show
that such lien or charge has priority over an earlier
mortgage.
The following passage from Mitra on the Law of
Joint Property & Partition in British India, Second
Edition, page 414, enunciates the abo\'.e position :
"You )Nill note that sums directed to be paid for
the purpose of equalizing the values of the shares are
in legal languag~ called "owelty". The Commissioners
have no authority without express authorization by
the Court to award this compe.nsation.
(See Rule 14,
O.XXVI, C.P. Code). Where in a suit for partition
the decree of the Court declares that any sum of money
should be paid as owelty by one co-sharer to another
the court may direct such sum to be a charge on the
share allotted.
I1,1 such a case should the co-sharer
before partition have created any mortgage in respect
of his undivided interest prior to the partition, the
charge for the owelty will have precedence over the
mortgage.
Shahebzada Mohammed Kazim Shah v.
R. S. Hill (1907) I.L.R. Cal.. 388."
To the same effect is the passage in Mulla's Transfer
of Property Act (4th Edition) at page 21 I
:
"The lien of a co-sharer for owelty money on
partition is entitled to precedence over pi:-ior mortgagees
of property allotted to the co-sharer who is liable to
pay owelty."
Shahebzada Mohammed Kazim Shah v. R. S. Hill (.')
was a case where the appellants had been awarded
two sums of Rs. 37,000 and Rs. 9,500 by way of owelty
on partition. At the date of the partition there was
( 1) LL.R. (1907) 35 Cal. 388, 39>, 393·
195.7
T . S. Swaminathaud~yar
v,
The Official
Receiver of
West T anjore
BhagwatiJ.
1957
T. .S. Swaminatha~
udt!Yar
v.
The Olficia/
Receiver of
West T anjore
BhagwatiJ.
SUPREME COURT REPORTS
subsisting a mortgage on a portion of the property
which was the subject-matter of partition and the
question arose whether the amounts awarded by way
of owelty on partition were entitled to priority over
the mortgagees.
It was observed by Maclean C. J.
in his judgment -
"Then arises the question of priority. To determine that question it becomes necessary•to ascertain
what was the substituted property which the mortgagor took under the partition.
It is clear that all he
took was the house No. 52-2 Park Street, subject to
the charges of Rs. 37,000 and Rs. 9,500 in favour of the
appellants ; and it can only be upon that, that the
Roy mortgagees can rank as mortgage~s, that is, upon
No. 52-2 Park Street subject to the charges created by
the decree."
Stephen J., who delivered a short but concurring
judgment added :
"It is quite plain that the appellant's claim, which
is a charge upon the property, constitutes a deduction
from the corpus of the property and is not affected by
any dealings ,., ith the possession of the property on
which the decision of the Judge of the Court of the
first instance is based."
There was no doubt on the facts of this case a charge
expressly created in favour of the co-sharer who had
been awarded o")'elty but that in our opinion does not
make any diITerence to the position.
The moment
there is a provision for such owelty made in a partition
decree, the member in w:10se favour that provision has
been made is entitICd to a lien or a charge over the
property which has fallen to the share of the member
to whom property of a higher value has been allotted.
If such a lien or a charge is expressly declared, so far
so good but even if it is not so expressly declared, there
is by necessary implication the creation of a lien or a
charge in his favour for the amount of such owelty.
This case was followed in Poovanalingam Servai \'.
Vecrai(') where Phillips J. observed as follows :
"There can be no doubt that in a partition suit
all equities between the members of the coparcenary
(1) 1\.I.R. (1926) 1Lidra:> i66.
S.C.R.
SUPREME COURT REPORTS
should be worked out allotting to each member the
]
share to which he is equitably entitled."
After quoting the passage
frorri
Freeman's
Co-tenancy & Partition set out above, the learned
Judge further observed :
"Even if there is no legal charge in the present
case, yet on equitable principles such a charge can be
enforced and
when
it comes to partitioning the
property between two co-tenants, this equity should in
my opinion be enforced."
The High Court in passing the order dated
November 5, 1943, initially went wrong in holding
that no charge was created in favour of the appellant
/ -r· under the terms of the decree dated, May 9, 1938, in
A.S. No. 60 of 1933.
No doubt the legal advi~ers of
the appellants were responsible for this result in so far
as they invited the Court to construe the decree as
creating an express charge in fayour of the appellant.
No such express charge could be spelt out of the terms
of the decree and in so far as the High Court came to
the conclusion that no such express charge was created
in favour of the appellant, it was u11doubtedly correct.
But, at the same time, the High Court should have
considered whether bv reason of the provision for
owclty contained in tl1e term's of that decree, there
\ · was, under the circumstances, by necessary implication
a lien or a charge created in favour of the appellant
for the payment of the sum of Rs. 24,257-0-8 and
interest out of the properties falling to the share of the
third Defendant's branch and therein the High Court
fell into an error.
'
This error was again repeated by the High Court
while passing the orders under appeal in A.AO. Nos.
724, 725 and 726 of 1945.
The question which the
High Court ought to have addressed to itself was
whether in spite of the fact that no express charge was
created in favour of the appellant under the terms of the
---r
decree dated the 9th May, 1938, in A. S. No. 60 of 1933 ·
for the payment of Rs. 24,257-0-8 and interest out of
the properties falling to the share of the 3rd Defendant's branch, there was by necessary implication a lien
or a charge created for payment of that sum by reason
1957
T. S. Swaminathaudq-Par
v.
The 0 .fficial
Receiver of
West T anjor1
Bhagwati J.
1957
T. S.
Swaminatlia~
udn)'ar
v.
The Official
R...ceivtr of
JV tst T anjort
Bhagwati].
790
SUPREME COURT REPORTS
[1957]
of the provision for owelty having been made in favour
of the appellant by way of equalization on partition.
Even if no express charge was created there was in
equity a lien or a charge created on the properties
falling to the share of the third Defendant's branch
and he did not acquire the properties which fell to his
share on such partition irrespective of or discharged
from the obligation to make payment of such sum out
of the same.
The appellant was, in our opinion,
entitled to payment of the sum of Rs. 24,257-0-8 and
interest out of the properties which fell to the share of
the third Defendant's branch on partition and which
came to the possession of the respondent by reason of
the insolvency of Defendant No. 3 .
. This position was rightly appreciated by the learned
Dist. Judge when he passed orders in favour of the
appellant on July I 4
I 945.
The following passage
from his judgment, in our opinion, truly reflects the
position as it obtained between the appellant and the
respondent :
"When we scrutinize these facts, the conclusion
is inevitable that the claim of the Respondent to the
present amounts stands 'even higher than on the basis
of the priority of a charge created in
insolvency
administration, whether by virtue of a "security'', a
charge created by an act of Court or a "lien" arising
from the operation of any law or statute.
In fact, it
could be contended with great force that the estate in
insolvency which vested in the hands of the Official
Receiver consisted of certain immovable properties
minus the sum directed to be paid to the
present
Respondent by the sale of available portions of ~he
estate as undertaken by the Official Receiver himself.
This was because 0. S. No. 22 of 1924 on the file of
the Kumbakonam Sub-Court was a suit of partition
in which the present Respondent was a 'harer and
partner, exactly as the
3rd
Defendant's
branch
represented another share. In decreeing the suit,
equities arose for adjustment· as between the several
sharers, and it was found that the 3rd Defendant's
branch was liable to the present Respondent in respect
of certain overdrawals of the 3rd Defendant during
S.C.R.
SUPREME COURT REPORTS
79 1
the minority of the Respondent, anci for certain lease
amounts due.
The Official Receiver represented the
3rd Defendant's branch in the appeal, since the insolvency had supervened.
The matter wold at once be
cleared from difficulty if we assume that the decree
had dealt with actual sums of money instead of
immovable properties. It will be obvious, in such a
case that the estate which would have vested
in the
Official Receiver after
the
Appellate decree, for
administration in Insolvency, would be the amount or
amounts assigned to the branches of the 3rd Defendant and plaintiff at partition, as shares, deducting
amounts payable to other co-sharers including
the
present
Respondent.
Merely
because the
estates
actually consi .ted of immovable properties while the
claim of a co-sharer like the present Respondent to an
adjustment on grounds of equity, was recogni;:ed in
the form of a direction to pay, by sale of a necessary
portion of the estate, the central fact of the situation
is not changed.
In other words, the present respondent
cannot be really classed as a creditor of the insolvent's
branch at all.
In respect of the sums due to him
under the partition decree, directed to be paid from
the estates of the Plaintiff and 3rd Defendant
as
equitable adjustment, he has really superior title, and,
assuming for a moment that the direction
related
instead to a specific item of immovable property, it is
obvious that such an item would not have
formed
part
of
the estate in insolvency at all.
As
Mr. T. S. Krishnamurthi Ayyar for the Official Receiver
has frankly conceded, it is a well-known principle that
in suits for partition the shares are first assigned upon
the
simple
basis of
division
for adminisp:ative
convenience, claims inter se being worked
out by
specific directions for payment.
Nevertheless, in law
and in fact, the shares actually derived by the parties
to the suit are those subject to or qualified
by the
directions made in adjustment."
If this was the true position as it obtained, and we
are of the opinion that it was, then, the orders under
appeal passed by the High Court were clearly wrong.
There was no justification for the respondent to ask
1957
T. S. SwaminatMudayar
v.
T ht 0 fficial
Receiver of
West Tanjore
Bhagwati].
1957
T. S. Swaminathaudayar
v.
The 0 Jficial
Receiver of
West Tanjore
792
SUPREME COURT REPORTS
[ 1957]
for
a withdrawal of the sum of Rs. 5,200 which he
had earlier deposited into Court on January 9, 1942,
or for the restitution of the sums of Rs. 5,500
and
Rs. 26,966 and Rs. 11 together with interest thereon
as claimed.
These monies had been paid
by
the
respondent in pursl!ance of the directions contained in
the decree dated May 9, 1938, in A. S. No. 60 of 1933
and they had been rightly paid by him and they could
never be the subject-matter of any execution proceedings as initiated by him.
Apart from the question
whether s. 144 read with s. 151 of the Civil Procedure
Code was at all applicable in the circumstances of this
case, we are of the opinion that the claim made by the
respondent for the aforesaid sums was
absolutely
unjustified.
\Ne are accordingly of the opinion that
the orders passed by the High Court in A. A. 0. Nos.
724, 725 and 726 of 1945 were wrong and should be
reversed.
The respondent wrote on November 21, 1953, to the
Regi.<trar of this Court to say that none of the creditors
had come forward to finance the defence of the appeals
and the Insolven€y Court, i.e., the Sub-Court, Tanjore
had ordered that t.he matters might be left undefended
as the funds in the e1tatc were insufficient to dcfepd
the appeals at the cost of the estate.
He, therefore,
requested that when the appeals were
heard ;rnd
decided a direction might he given by this Court that
there should be no order for
costs against him. \Ve
do not see how we can absolve the respondent from
liability to pay the costs which mnst normally follow
the event.
~
e
accordingly order that the appeafo
will be
allowed; the E. P. No. 35 of 1944 and E. A. No. 182
of 1944 will stand dismissed; E. A.