- (1.) These two are appeals against two separate decrees of the High Court of Madras arising out of two suits as between the same contesting parties with reference to a connected set of facts. Civil Appeal No. 104 of 1954 is before us by virtue of special leave granted by this Court under Art.136 (1) of the Constitution. Civil Appeal No. 169 of 1956 has come up by reason of certificate granted by the High Court under Art. 133 (1) (a) of the Constitution. The parties to the litigation are Nattukottai Chetties a wealthy banking community in South India who, at the time, were having large banking transactions in Burma and other places in South-East Asia. One AL. PR. Periakaruppan Chettiar (hereinafter referred to as Periakaruppa) owned and possessed considerable properties. He adopted one AL. PR. Alagappa Chettiar (hereinafter referred to as Alagappa) in or about the year 1914. There arose acute differences between them from about the year 1924 owing to the alleged wasteful habits of Alagappa who ran into debts. This led to criminal complaints between them, each against the other; in 1926. (See EXS. P-5 and D-12). One of Alagappa's creditors obtained a decree against him and attached Alagappa's half share in the family residential house including the site on which it was situated. This resulted in a regular suit in which the question at issue was whether the site was ancestral site and whether the super-structure was constructed out of the ancestral funds. It was found that the site was ancestral. Periakaruppa maintained that the super-structure which was substantial in value compared with the site was built out of his self-acquired funds and was not joint family property, while Alagappa and the attaching creditor contended to the contrary. The litigation went up to the High Court and the High Court accepted the contention of Periakaruppa and made a declaration that the site was ancestral and that the super-structure was the self acquisition of Periakaruppa. The judgment of the High Court was dated 19th November 1926, and is reported in Periakaruppan v. Arunnchallam I.L.R. 50 Mad. 582: (A.I.R. 1927 Mad. 676) (A). During the pendency of this litigation in the High Court the adopted son Alagappa filed a suit on 9th September 1926, on behalf of himself and his minor son by name AL. PR. AL Periakaruppan Chettiar (herein after) for distinction, referred to as junior Periakaruppa, represented by his mother and next friend by name Muthai Achi. It has to be mentioned that in or about 27th June 1926, Periakaruppa purported to make a second adoption of a young boy by name AL. PR. Ranganathan Chettiar (hereinafter referred to as Ranganatha) on the footing that such an adoption was permitted by special custom in Nattukottai Chetti families. The suit O.S. No. 114 of 1926 filed by Alagappa and his minor son, junior Periakaruppa, was therefore filed as against Periakaruppa and his second adopted son Ranganatha, who at the time was also a minor. It was for delivery of a half share of the properties of the family on the footing that all the properties were joint family properties and for a declaration that the second adoption was invalid. The first defendant therein, Periakaruppa, filed a written statement contesting both these matters and claiming that all the suit properties in their entirety were his self-acquisition and that the plaintiffs had absolutely no rights therein and also asserting that the second adoption was valid. Before the suit proceeded to the stage of issue and trial, the dispute between the parties was compromised by a Rajinama brought about by four Panchayatdars, who are all respectable members of the Nattukottai Chetti community. Some of the questions that arise in the present appeals centre round the proper. construction of some of the terms of this Rajinama, which will be noticed later. It is sufficient to state at this stage that by that Rajinama the two plaintiffs, Alagappa and his minor son, junior Periakaruppa, obtained Rs. 75.000 each and Alagappa's wife Muthayi Achi, the mother of the minor son and his next friend in the suit, was to get a sum of Rs. 14,000 as her Stridhan. These mounts were paid by means of four hundis. Rs. 25000 and Rs. 50,000 for Alagappa, Rs. 75,000 for junior Periakaruppa and Rs. 14,000 for the mother, Muthayi Achi on Nattukottai Chetti Bankers of Periakaruppa in Burma. It was one of the express terms of the Rajinama that all the properties belonging mentioned in the plaint in that suit and other properties to the first defendant. Periakaruppa were admitted to be his self acquisitions and that the plaintiffs therein had no right and connection whatsoever in any of them or in the charities founded by Periakaruppa and in the properties belonging thereto or their management, either in the life time of Periakaruppa or subsequent thereto. It was also one of the specific terms of the Rajinama that the plaintiffs should remove themselves from the family house with all their belongings and that the possession of the aforesaid house be delivered to Periakaruppa. It was also expressly stipulated that the petition them pending for leave to appeal to the Privy Council against the judgment reported in I.L.R. 50 Mad. 582: (A. I. R. 1927 Mad. 676) (A) was to be withdrawn. This compromise was certified to be for the benefit of the minor plaintiff concerned, as also of the minor defendant Ranganatha and was accepted by the Subordinate Judge before whom the compromise petition was filed. As a result, the compromise was accepted by the Court on August, 15, 1927, and the suit was dismissed in terms thereof on the same date. About an year and a half later Periakaruppa executed a will on April 4, 1929. The genuineness and due execution thereof are not in question. But the effect of that will is also one of the main points in dispute. Periakaruppa died about three months later i.e. on July 14, 1929 and his wife Lakshmi Achi died within an year thereof on March 11, 1930. By the will, broadly speaking, Periakaruppa made arrangements for certain religious gifts and charities and made arrangements for the management thereof and gave the residue of the property to his wife Lakshmi Achi for her life and thereafter to his second adopted son Ranganatha. Ranganatha, who some time in of about the date of Lakshmi Achi's death in 1930, appears to have attained majority, has been in undisputed possession and enjoyment of Periakaruppa's properties ever since till late in 1944. Alagappa's son junior Periakaruppa attained majority in December, 1943, and filed two suits on November 11, 1944, in the Subordinate Judge's Court of Devakottai, one numbered as O. S. 156 of 1944 and the other as O. S. 160 of 1944. O. S. No. 156 of 1944 was on the footing that Rs. 75,000 which was given to him under the abovementioned Rajinama of the year 1927, was under the terms thereof constituted a trust for his benefit during his minority under the trusteeship of Periakaruppa himself and another person A.P.S. Chockalingam Chettiar of Athangudi (hereinafter referred to as Chockalingam) the junior paternal uncle of the minor's mother Muthayi Achi and that the money was wrongly appropriated by Chockalingam owing to his straightened circumstances. His case was that Periakaruppa as a co-trustee with Chockalingam was equally responsible for breach of the trust and that therefore he was entitled to have the moneys found due on account paid out of the estate of Periakaruppa in the hands of Ranganatha as well as from the estate of Chockalingam in the hands of his son. The second suit O.S. No. 164 of 1944 was a suit to recover the entire properties of Periakaruppa in the possession of Ranganatha for himself and his father Alagappa who was made the first defendent in the suit on the ground that Ranganaths's adoption was invalid, that the will of Periakaruppa was ineffective and that the properties devolved on himself and his father Alagappa. It may be noticed that so for as the father Alagappa is concerned the suit would prima facie be time barred since it has been filed about 15 years after the death of Periakaruppa. The plaintiff junior Periakaruppa however filed the suit on the footing that in view of his minority for all this period until December, 1943, the suit was not barred. Hereinafter, for convenience, the first O.S. No. 158 of 1944 will be referred to as the trust suit, and the second suit O.S. No. 164 of 1944 will be referred to as the succession suit.
(2.) In the succession suit the main questions that arose for decision were: 1. Whether the adoption of Ranganatha as a second adopted son was valid: 2. if not, whether the will was effective to convey the property of Periakaruppa to Ranganatha after the death of his wife Lakshmi Achi, notwithstanding the invalidity of his adoption; 3. whether, in case the will was ineffective the properties if Periakaruppa devolved on both Alagappa and his son junior Periakaruppa together or on Alagappa alone to the exclusion of junior Periakaruppa; 4. if the devolution was on both together, whether the rights of junior Periakaruppa were barred by reason of S. 7 of the Indian Limitation Act. 1908 (Act IX of 1908). This involved the further questions (a) whether by and under the Rajinama Alagappa and his son became divided in status inter se so as to make S. 7 inapplicable. (b) whether in case the devolution was on both together as members of a joint family, S. 7 had application to the factual situation in the family. So far as the adoption of Ranganatha was concerned both the courts below, while holding that the adoption as a fact was proved, have found against existence of the custom pleaded as to its validity and hence concurrently found the adoption to be invalid. That conclusion is no longer in dispute in this Court. As regards the will both the Courts held that the will was ineffective to vest any title in Ranganatha though on slightly different grounds. As regards question No. 4 relating to limitation, the two Courts came to different conclusions with the result that the trial Court dismissed the suit as barred by limitation, while the High Court reversed it and granted a decree for the half share of Periakaruppa's properties in favour of junior Periakaruppa's properties in favour of junior Periakaruppa holding that in respect of the other half share the rights of Alagappa were barred and that Ranganatha acquired the same by his adverse possession. As regards question No. (3) and the subordinate questions (a) and (b) of question No. (4), there appears to have been no serious question raised in the trial Court by the defendant as to the exclusion of junior Periakaruppa by Alagappa in the matter of succession to Periakaruppa's properties, or any serious questions raised by the plaintiff as to the Rajinama bringing about a partition inter se between the father Alagappa and his minor son junior Periakaruppa and of Alagappa not being the de facto manager of the family. It was accordingly found by the trial Court that both of them succeeded as members of the joint family and that therefore the minor, junior Periakaruppa, was barred by virtue of S. 7 of the Limitation Act. When the matter came up on appeal to the High Court, a question was raised that S. 7 would not be applicable in this case unless it was further made out that the father Alagappa was the de facto manager of the family consisting of himself and his minor son of which it is alleged there was no proof or finding, Both the Judges allowed this point to be raised and called upon the trial court to take evidence and submit a finding in respect of that contention. The trial Court accordingly took evidence in regard thereto and returned a finding that on the evidence, both the father and the minor son were living as members of a joint family and that the father was in fact the de facto guardian. When the matter was reheard by the same Bench of the High Court on the return of the finding, the Bench did not go into the correctness or otherwise of this finding, on the view that this finding was of no consequence, if it is found that by virtue of the Rajinama both the father and the minor son became divided inter se. The learned Judges while realising that the finding was called for on the undisputed assumption that the father and the son were undivided in status, were of the opinion that there was nothing to prevent them from reopening the same and held on a construction of the Rajinama that is brought about divided status inter se between the father Alagappa and his minor son junior Periakaruppa. In that view they found S. 7 of the Limitation Act had no application to the case and came to the conclusion that the succession suit by junior Periakaruppa was not barred by limitation in so far as it related to his own share though barred in respect of Alagappa's share. Hence the succession suit ended in favour of junior Periakaruppa in respect of a half share of the properties left by Periakaruppa.
(3.) As regards the trust suit the contentions raised were: 1. That under the Rajinama both Periakaruppa and Chockalingam became trustees in respect of the sum of Rs. 75,000 to be invested in Chetti firms as provided in the Rajinama; 2. that as a fact the amount was invested with Chockalingam, one of the trustees themselves, contrary to the law; 3. that such investment itself constituted breach of trust for which Periakaruppa was also responsible. It appeared on the evidence that out of the trust amount, a sum of Rs. 30,000 was invested in the purchase of a house at Athangudi in South India (the place of Chockalingam) and that Alagappa and his minor son, the junior Periakaruppa and his family have been since that purchase on July 23, 1928, living in that house. At the trial, therefore, credit was given to this amount as being proper investment of the trust funds in the matter of account-taking by concession of the lawyer for junior Periakaruppa. The defendant Ranganatha in addition to contending that no trust was created, also contended that as a result of subsequent transactions junior Periakaruppan got the benefit not only of the purchase of the house above referred to but also of a mortgage executed in favour of himself and another by Chockalingam in 1930 for a lakh of rupees of which Rs. 70,000 was his of which he obtained the benefit and that, therefore, the alleged breach of trust must be taken to have been waived and that in any case he was entitled to have the mortgage document as much as the purchase of the house to be taken into consideration for reducing his liability in respect of the alleged breach of trust. These contentions were negatived by both the courts with the result that there was a decree against Ranganatha and his minor son in respect of half the loss occasioned by the breach of trust, payable out of the half share of Periakaruppa's properties in their hands. The result of the two judgments of the High Court in both the suits was against Ranganatha and hence the two present appeals before us by him. ;