P L D 1954 Federal Court 270 (PLP)

MUHAMMAD SHARIF, J.--‑This is an appeal against the judgment and decree of the High Court of Judicature at Lahore dated 22nd of December 1947, decreeing of appeal the suit of the plaintiffs and reversing the judgment and decree the Senior Subordinate Judge, Gujranwala, dated 7th June 1945, by which the suit had been dismissed with costs. The real question for determination in this appeal is whether the sale in dispute of ancestral agricultural land is valid under customs? The following pedigree‑table shall help in understanding the litigation KARAM DAD __________________|_____________________ | | Hakim Ali Hussain Bakhsh | | | | | | |__________ | | | | | __________|_______________ | | | | | Muhammad Khan Ghulam Ahmad Sultan Ahmad | | ___________| | ____________________________|___________ | | | Ghulam Qadir Rahmat Khan Amir Ali vendor vendor vendor | | | Pal Sikandar | | Plaintiff | | | | ____________|__________ | | | | | Abdul Qadir Muzaffar Shaukat Ali | Plaintiff Plaintiff Plaintiff | | _______________________ | ________________|____________________________ | | | | Basharat Ali Riasat Ali Imdad Nabi Iltaf Ali Plaintiff Plaintiff Defendant 9 Defendant On 10th of January 1938, an area of 2660 kanals situated in village Khotra Tehsil and District Gujranwala was sold by Hakam Ali, son of Ch. Karam Dad and Ch. Amir Ali and Ghulam Qadir through his brother Amir Ali, all sons of Ch. Hussain Bakhsh for Rs. 15,000 in favour of Ch. Ghulam Muhammad, son of Ch. Fazal, Sardar Khan and Sube Khan, sons of Ch. Sohna and Nur Ahmad, son of Ch. Sohna in the shares specified in the sale‑deed. Out of the sale considera tion, Rs. 13,500 was received in cash before the Sub‑Registrar at the time of the registration, Rs. 1,000 was admitted to have been received at the time of the execution of the agreement of sale dated 16th of December 1937 and Rs. 500 was said to have been received to cover the expenses of the execution of the deed. There is no dispute about the passing of the consideration. On 16th of December 1938, Ch. Sultan Ahmad, son of Hakam Ali vendor and Altaf Ali, son of Amir Ali vendor, brought a suit for pre‑emption of the land forming the subject‑matter of sale of 10th of January 1938. By way of compromise the suit was withdrawn on 24th of January 1939 and the plaintiffs received Rs. 1,2000 in the bargain. The plaintiffs also agreed that there would be no further litigation in any way on behalf of the descendants of the vendors and if any such litigation ensued, they would be liable to pay Rs. 5,000 to the vendees. This sum of Rs. 12,000 was paid 5 000 in cash at the time of the compromise and Rs. 7,000 some time after. The suit out of which this appeal has arisen, was filed on 7th of January 1944 by (1) Riasat Ali, son of Amir Ali vendor and (2) Shaukat Ali, major on his own behalf and on behalf of his minor brothers, Muzaffar Ali and Abdul Qadir and as guardian of Pal Sikandar, son of Ghulam Qadir vendor and Bashara t Ali, another minor son of Amir Ali, for the usual declaration under custom, that the sale of the land in village Khotra on 10th of January 1938 for Rs. 15,000 to the extent of the share that had been originally purchased by Hussain Bakhsh, was not binding on the plaintiffs-reversions s as the land alienated was ancestral qua then; that the market value o the an was more than Rs. 30,000 and that there was no necessity for the sale. The defendants traversed the above allegations and pleaded that the plaintiffs had no right to maintain the suit ; that the transaction was for the benefit of the entire family and that the property was not of the value of Rs. 30,000 as stated in the plaint. It was further maintained that the suit had been filed in collusion with the vendors, out of sheer greed and that t e sale could not be set aside as it was an act of good management. The learned trial Subordinate judge found : that the plaintiffs were in law entitled to maintain the suit; that the suit‑land, the share of Hussain Bakhsh i.e., one‑half of the entire land sold under the deed of 10th January 1938 was ancestral qua the plaintiffs; shat the full consideration mentioned in the deed had passed and dismissed the suit on the ground, that the alienation in dispute was an act of good management on the part of the vendors and that the vendees had made bona fide enquiries at the time of the sale and this and this fact in itself was sufficient to sustain the sale in their favour. The plaintiffs preferred an appeal to the High Court of Judicature at Lahore. The learned Judges held that no representation was made to the vendees that the vendors meant to purchase land in Sargodha". It was further held "that the sons of Hussain Bakhsh alienated their ancestral property and either spent the proceeds thereof on the purchase of movable articles or improved their self‑acquired property at Lyallpur. In these circumstances, the plaintiffs would not be in a position to follow the proceeds of the alienation of ancestral property. The present transaction therefore could not be upheld as an act of good management so far as the plaintiffs are concerned." The vendees have now filed an appeal to this Court under section 3 of the Privy Council (Abolition of Jurisdiction) Act 1950. The ancestral character of the property and the appli cability of custom are no longer in dispute. It might, how ever, be added that the land iii suit situated in village Khotra was purchased by Hakam Ali and his brother Hussain Bakhsh in equal shares on two different occasions : first on 31st August 1911, 2246 kanals 8 marlas for Rs. 5,000 and second on 11th September 1915, 353 kanals 6 marlas for Rs.

800. This makes a total of 2598 kanals 14 marlas and the area has not been correctly stated in the judgment of the first Court. It would, therefore, appear that the property which was of the value of about Rs. 6,000 in 1915, was in the year 1938 sold for Rs. 15,

000. In addition, to persuade the plaintiffs in the pre‑emption suit to withdraw their claim for the land purchas ed, the vendees paid the extra sum of Rs. 12,

000. It would thus be obvious, that about the end of year 1938, the vendees themselves considered the property purchased by them in the beginning of 1938 for Rs. 15,000 to be of the value of not less than Rs. 27,000 At one stage, it was argued that the increase in value within the space of a few months, was due to the opening of a new water outlet, through the efforts of the vendees. This change was effected in July 1938. From the statement of Fateh Muhammad (P. W. 5), it appears that before the sale in dispute, the vendors themselves had applied to the canal authorities to make the necessary change in the water outlet. Some canal officials had visited the spot but before the matter could be finally decided, the land itself had changed hands. Another relevant consideration for the pay ment of the extra sum of Rs. 12,000 might be, that the vendees thought that they had made a good bargain and T few thou sands more would not matter, if by this act, they could pur chase peace and feel secure in the continued enjoyment of the property and not be harassed by suits on behalf of the heirs of the vendors. It was contended by the learned counsel for the appellants, that there was distinct finding by the trial Court, that land in suit did not yield income sufficient to cover the expenses of cultivation and management ; that the family was not in a posi tion to cultivate the land itself and the members were, as a matter of fact, living at a distance and that a representation to that effect, was made by the alienors which was bona fide believed by the alienees and as these findings of fact were not upset by the appellate Court, the acceptance of appeal by the High Court was wholly unjustified. The High Court according to the learned counsel had dealt with a subsidiary part of the case and had thus misdirected itself. It is common ground that according to custom, ancestral property in the hands of an agriculturist, can be alienated for a necessary purpose which includes the payment of just debts and the burden of proving the necessary purpose lies upon the alienee. The leading case on the subject is Devi Ditta and others v Saudagar Singh and others (65 P R 1900 (FB)). At pages 296 and 297 the following weighty observations which have always afforded guidance in the decision of questions of necessity, may be briefly reproduced: "An examination of the leading authorities on the subject of alienations of ancestral land by male proprietors governed by customary law appears to establish the following pro positions. They are, however, general principles to be borne in mind in deciding cases, but the special facts of each case must have a material bearing in the application of these principles :‑ (1) Although the male proprietor has not an unrestricted power of alienation of ancestral land where he has male descendants or collaterals, he is, unlike the widow, a full proprietor, and the necessities in his case are not to be judged by analogies drawn from the case of the widow. (2) The male proprietor cannot alienate at pleasure without necessity but the payment of his just antecedent debts is a necessity. (3) The words "just debt" means a debt which is actually due, and which is not immoral, illegal, or opposed to public policy. It also means a debt no contracted as an act of reckless extravagance or wanton waste or with the intention of destroying the interests of the reversioners. It need not be one incurred for a necessary purpose, but we think that if a non‑necessary debt is unreasonably large compared to the means and station in life of the proprietor, it cannot come under the definition of a just debt. What is unreason able or extravagant must depend upon the circumstances of each particular case and must be decided by Court on fair and rational grounds. (4) Debts incurred for necessary purposes are always binding irrespective of the income and means of the male proprietor. (5) When an alienation of ancestral land is made by a male proprietor the onus of proof of its validity always lies, in the first instance, on the alienee whether he be a third party or a person whose debts, have been discharged by the alienation. (6) It is not necessary for the alienee, who is also the antecedent creditor, to prove that all the previous debts were incurred for necessity. But lie is, by his position prima facie fixed with knowledge of the nature of the debts and of the purposes on which the money borrowed has been spent, and if, not being for actual necessity, they singly or collectively as shown in paragraph 3, are unrea sonable or prove reckless extravagance or waste, or designed to injure the reversioner s interests on the part of the debtor, the alienation in lieu of such debt cannot be held valid. An outsider who pays antecedent debts in consideration of a transfer of the property if he acts honestly and makes proper inquiry whether the debts are actually due, is not responsible if he has been deceived and is entitl ed to ask for his alienation to be treated as binding. He can, however, be put in the same position as the other alienee if the circumstances show that he had knowledge of the true nature of the debts, or that he made no inquiry whatever or acted with bad faith". The above dictum that the payment of a 'just debt' is a necessity, justifying an alienation and the definition of the "just debt" as given in 65 P. R. 1900 (F. B.) were approved by their Lordships of the Privy Council in Kirpal Singh v Balwant Singh (26 P R 1913 (PC)) The alienation for the payment of "just debt is not the only manner in which ancestral property can be conveyed under custom, it shall also be held valid if it is found to be an act of good management. Reference to several reported cases were made, where the transfer of ancestral property was ad judged from that standpoint. In Santa Singh. v Waryam Singh and other (19 P R 1915) it was held that money advanced to an agri culturist to enable him to carry on a shop‑keeping business could not be called to have been advanced for a necessary purpose as‑`village custom' would not look with favour upon the conversion of a Jat agriculturist into a shop‑keeping trader and would not countenance an alienation of ancestral land in order to enable such agriculturist to carry on the business of his shop. In Muhammad Hassan‑ud‑Din v Saif Ali Shah (I L R 4 Lah. 122) one Chiragh Ali Shah a Sayad of Campbellpur Saidan. mortgaged a serai to one Sundar Singh for Rs. 700 and promised to pay interest at Rs 1‑8‑0 per cent per mensem On 9th January 1914, the serai was sold to Muhammad Hassanuddin defendant‑appellant for Rs. 1,250 which included Rs. 750 payable to Sundar Singh mortgagee. The suit was brought by the son of the alienor. At page 125. the learned judges found that " it appears that at the time of the mortgage Chiragh Ali Shah had only 10 or 11 kanals of land. This was not sufficient for him to earn his living as an agriculturist. The facts of 19 P R 1915 are distinguishable. In the present case, the alienor had no other means of subsistence and under the circumstances he was justified in alienating the serai for the purpose stated by him." In Kirpal Singh v. Sohan Singh (I L R 8 Lah. 34.) one Bahadur Singh, a Kalal sold 24 kanals 18 marlas of land to Sohan Singh for Rs. 4,000 on 14th June 1924. The suit for the usual declaration under custom was brought by his nephews. The two Courts below had dismissed the suit. It was held by both the lower Courts that the land held by the vendor was of very poor quality and that the income thereform was not more than Rs. 8 per mensem. At page 344 it was pointed out that the vendor owned only 15 bighas of poor land. Four bighas of which were already under mortgage this mortgage having been effected 5 or 6 years pre viously and acquiesced in by the reversioners. That in itself would show that the vendor was not well off and could not live upon the income of the land which was not more than Rs. 8 a month. The vendor used to be in the Army but had retired some 25 years ago without pension. Since then his only source of income had been land i. e., Rs. 8 a month together with certain sums, which had been lent out by his father and which were collected by him. The sums so collected must have been exhausted before the sale took place. In the circum stances, it was considered prudent and proper transaction that a part of the sale proceeds was lent out at interest to sup plement his very small income. It was also observed that the case of a Kalal must be differentiated from a Jat; while the latter have from time immemorial been connected with the land, the former have been following trade and service as their usual occupation. In Taj Din v. Dula (A I R 1926 Lah. 515.) the sale was made for Rs. 1,380 one item of consideration was a bond for Rs. 800 in favour of vendee himself and out of the considera tion of this bond, Rs. 550 were debts raised by the alienor from the alienee for the purpose of trading in cattle. It was held that the proportion borne by the item in question to the total price is very much less than one‑half, and the conversion of a Jat agriculturist into a dealer of cattle is not likely to be looked upon by village custom in the same light as his conver sion into a shop‑keeping trader. It would serve no useful purpose to recapitulate the facts of the other cases cited. A mere reference shall suffice. I L R 13 Lah. 524 ; A I R 1933 Lah. 338 ; A I R 1934 Lah. 452 (2) ; A I R 1934 Lah. 998 ; I L R 16 Lah. 982 and A I R 1935 Lah. 298 also deal with the same subject. In each of the above cases, the alienation was found to be an act of good management, where the alienor already engaged in business, wanted further funds for the purpose ; or when the land was already under mortgage and there appeared no prospect of paying it off, without selling a part of it thus saving the rest ; or where the alienor and his family had abon doned all connections with the place where the property was situate and had migrated to another place ; or where residence in the old place had become impossible; or where the means of income were so small, that the alienor could not but part with his property. The expression "act of good management has not been defined nor is it susceptible of a precise definition. Broadly speaking, it would mean taking such order with the ancestral property, as may be conducive to greater benefit or advantage to the alienor and the existing body of reversioners and not done as an act of reckless extravagance or waste or with a view to injure the reversioners interest. No hard and fast rule can be laid down. It must vary with the circumstances] of each case. The position and status of the vendor ; his means of income; the encumbrance upon the lard, his ability or capacity to manage or live in the locality etc. etc. are some of the relevant factors to be considered in deciding whether a particular transaction is or is not "an act of good management." The decided cases referred to above, do not lay down any principle separate from that enunciated in Devi Ditta and others v. Saudagar Singh and others (supra) but apply it to the facts of a particular case in the light of the propositions detailed at pages 296 and 297 reproduced above. The sale in dispute of 10th January 1938, may now be examined. It is true, that the finding of facts by the trial Court, that the land was of a poor quality and the income was not sufficient to meet the expenses was not specifically held to be incorrect by the High Court in appeal, but this was clearly due to the failure on the part of the vendees to em phasise this aspect of the matter before the High Court. The learned Judges of the High Court canvassed the following observation in the trial Court's judgment :‑ "The sale at Sargodha was no doubt affected in the name of Ghulam Ahmad alone but it does not establish that the representation regarding the purchase of land in Sargodha which was made by the vendors to the alienees at the time of the sale was false or incorrect. Once it is proved that the vendors required money for the purchase of land in another district, the vendees are safe and they are not bound to look to the actual application of the money. Whether the land in Sargodha was purchased in the name of Ghulam Ahmad alone or was purchased in the name of all the members of the family is not the concern of the vendees". This observation was found by the learned judges of the High Court to be based on a misapprehension. It was pointed out :‑ "No representation was made to the vendees that the vendors meant to purchase land in Sargodha as the sale deed does not contain any such recital. All that is stated in the sale deed is that the land at Gujranwala was not bringing any income to the vendors and that they were selling it in order to invest the money elsewhere. Chaudhri Muhammad Hussain, Advocate D. W. 7 has stated that Muhammad Khan and Rehmat Khan told the vendees in his presence that the land at Khotra was ghairabad and that they were selling it so that they might be able to invest the sale pro ceeds at Lyallpur for improving their lands there. There is therefore, not the slightest evidence on the record showing that any representation was made to the vendees that the vendors wanted to purchase land elsewhere". As the learned Judges of the High Court, (presumably on account of the fault of the vendees' counsel before them) did not determine what was the income from the land and what were the expenses of the cultivation and management, we allowed the learned counsel for the parties to take us through the evidence on these points, so that we may come to our own independent conclusions. This has been done and on going through the entire evidence, oral or documentary, we must come to the finding that the claim of the vendees that the income from the land was insufficient to meet the expenses of cultivation etc, or that it was otherwise a source of loss to the vendors, is not established. The evidence as to income is very meagre and as to expenses, nil. Amar Nath (D. W. 5) is the only witness to depose to the area of land under cultivation and to the extent of the produce thereof. He is a weighman in the village. According to him, only two squares of land were brought under cultiva tion. Twenty/thirty manies munji, one or one and a half mani wheat, was landlord's share. Two or two and a half hundreds was the revenue paid by the landlords per annum. Water rates were paid by tenants. The learned trial Subordi nate judge rightly has not placed much reliance on the evidence of D. W.

5. He has, however, calculated the area of the land under cultivation wrongly. According to his calculation, 640 kanals and one marla were then under cultivation. The correctness of this figure is disputed and the learned counsel for the respondents, has asserted that the total came to 737 kanals 15 marlas. For the purposes of this suit, let it be assumed that the area under cultivation did not exceed 640 kanals as stated in the judgment of the trial Court. The yearly income was calculated to be between Rs. 500 and Rs. 600 at the best. Out of this, the learned Subordinate Judge has deducted Rs. 250 as the amount of land revenue. The amount which should have been deducted on account of land revenue, should have been only the share of the sons of Hussain Bakhsh, and it was one half of Rs. 200 or Rs.

250. There is nothing on the record to suggest, that any other expenses were being incurred on account of cultivation or management. As a matter of fact, the value of the share of the landlord, which was calculated according to "Lal Kitab" meant the value, after making due allowance for the incidental expenses. The record further shows that the landlord's share was one‑third in the case of certain crops and one fourth in the case of others. The learned Subordinate judge has in his calculations allowed one‑fourth as the share of the landlord throughout. It seems to have been assumed that the landlord's share, small as it was, was further reduced by some of the amounts supposed to have been spent in meeting some cultivation expenses, but about which there is not a word on the record. The income from land was not as much as could have been easily obtained, with proper management and attention. But it would be wrong to say that "it is not enough to meet the expenses" That the land in suit should have been neglected could not be unexpected. The family owns extensive areas of land in more districts than one and, perhaps, earns so much money that it can afford to be negligent or careless about this patrimony. The branch of Hakim Ali is living in Lyallpur district, but the descendants of Hussain Bakhsh have not, one and all, as suggested in the judgment of the trial Court, abandoned their paternal home. Altaf Ali is still residing in village Bhilowali. Kothra is only four miles from that place. Curiously enough, in the agreement for sale, dated the 16th of December, 1937, Chaudhry Muhammad Khan son of Chaudhry Hakim Ali and Chaudhry Rehmat Khan son of Chaudhry Hussain Bakhsh, the representatives of the two branches, describe themselves as the residents of Bhilowali Tahsil Gujranwala at present residing at Kothra Tehsil and District Gujranwala. Excessive importance was sought to be attached to the representation said to have been contained, in the deed of sale, dated the 10th of January' 1938; as if the fate, of the case hanged by it. Representation' does not dispense with proof. In Banga Chandra Dhur v. Jagat Kishore Achariya Chowdhuri (I L R XLIV Cal. p. 186), the use and value of representation Was con sidered. At page 195 it was pointed out that "recitals cannot by themselves be relied upon for the purpose of proving the assertions of fact which they contain. Indeed it is obvious that if such proof were permitted, the rights of reversioners could always be defeated by the insertion of carefully prepare d recitals. Under ordinary circumstances and apart from statute, recitals in deed can only be evidence as between the parties to the conveyance and those who claim under them". It was further observed at page 196 that "no fixed and inflexible rule call Fe laid down as to the proper weight which they are entitled to receive. If the deeds were challenged at the time or near the date of their execution, so that independent evidence would be available the recitals would deserve but slight consideration, and certainly should not be accepted as proof of the facts. But as time goes by and all the 'original parties to the transaction and all those who could have given evidence, on the relevant points, have grown told or passed away, a recital consistent with the probability and circumstances of the case, assumes grater importance, and cannot lightly be set aside ; for it should he remembered that the actual proof of the necessity which justified the deed is not essential to establish its validity. It is only necessary that a representation should have been made to the purchaser that such necessity existed, and that he should have acted honestly and made proper enquiry to satisfy himself of its truth. The recital is clear evidence of the representation and, if the circumstances are such as to justify a reasonable belief that an enquiry would have confirmed its truth, then when proof of actual enquiry has become impossible, the recital, coupled with such circumstances, would he sufficient evidence to support the deed. To hold otherwise would result in deciding that a title becomes weaker as it grows older, so that a transaction‑‑‑perfectly honest and legitimate when it took place‑would ultimately be incapable of justification, merely owing to the passage of time". In judging the value of the receipts in this case, it should not be overlooked that the other party that is, the vendees to whom the representation was said to have been made are not strangers to the locality. They are in fact the residents of the place where the land in suit is situated. They them selves knew or could easily have ascertained the quality of the land and the approximate income therefrom. They were perhaps in a better position to know about these matters than the owners who were not cultivating the land themselves and were not residing in the same village. It was recited in the deed of sale that (1) a large area of the said land is Banjar Jadid and Banjar Qadim and is not under cultivation, (2) a large capital is required to bring this area under cultivation, (3) the land is of inferior quality. It yields only a nominal income, which is not enough to meet the expenses, and (4) if it is sold, its sale money can be a source of substantial income. That the bulk of the land was lying waste is not in dispute and explains the small price for such a large area. The jamabandi papers and a visit to the land itself would have easily shown this. That a large capital might have been required to bring the land under cultivation, is not borne out on the record. If the insinuation was, that the vendors , were not in a position to supply the necessary amount of capital, there is no basis for it as has been shown earlier and the vendees could not be unaware of this. The vendors were the owner of large areas of land in several districts without any burden and were holding the position of big Zamindars so much so, that the heads of both the branches of the family were Zaildars‑one in Lyallpur district and the other in Sheikhupura district. The other part of the recital that the income was "not enough to meet the expenses", rests upon no material as has been discussed above. Whether the sale money "can be a source of substantial income" is problematical. In any case, according to the Customary Law , it is not open to an agriculturist to sell away his ancestral holding in the vague hope of investing the money in such a manner that it may bring any substantial income. The oral evidence as to the representation, is of a different nature. Khan Bahadur Chaudhri Muhammad Hussain, D. W. 7 deposed that in his presence, the vendors had said that "they could not manage it from Lyallpur where they resided and that they would be able to invest the sale proceeds better at Lyallpur for improving lands there". According to Sardar Khan defendant himself, the vendors "wanted to acquire more land in Lyallpur and Sargodha with the sale proceeds". On this material, it is difficult to hold what was the actual representation that really induced the vendees to enter into this transaction. As remarked above, the vendees themselves knew everything about the land and no representation under the circumstances could influence their conduct in making the purchase. It was purchased because it was rightly considered to be a profitable bargain but they could only retain it, if they had succeeded in proving that it was a prudent act on the part of the vendors and an act of good management in the sense that it would benefit not only the parties to they transaction but also those who had some residuary interest in it. The onus of proving this was on the vendees and they have failed to discharge it. The reply to the question stated in the beginning of this judgment is therefore in the negative. The appeal is consequently dismissed with costs. A.H. Appeal dismissed.