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PETITIONER: G. NARAYANA RAJU

       Vs.

RESPONDENT: G. CHAMARAJU & OTHERS

DATE OF JUDGMENT: 19/03/1968

BENCH: RAMASWAMI, V. BENCH: RAMASWAMI, V. SHAH, J.C. MITTER, G.K.

CITATION:  1968 AIR 1276            1968 SCR  (3) 464  CITATOR INFO :  F          1976 SC1715  (13)

ACT: Hindu   joint  family-Hotch  Potch-self  acquisition    when acquires   characteristics   of   joint   family    property -concurrent finding that business is separate--Supreme Court will not interfere under Art. 133.

HEADNOTE: There  is  no presumption under Hindu law  that  a  business standing in the name of any member of the joint family is  a joint family business even if that member is the manager  of the  joint  family.   Unless  it could  be  shown  that  the business  in  the hands of the coparcener grew up  with  the assistance  of  the joint family property  or  joint  family funds or that the earnings of the business were blended with the  joint  family  estate, the business  remains  free  and separate. [466 F-H] Bhuru  Mal v. Jagannath, A.I.R. 1943 P.C. 40, Pearey Lai  v. Nanak Chand, A.I.R. 1948 P.C. 108, Chattanatha Karayalar  v. Ramachandra Iyer, A.I.R. 1955 S.C. 799, referred to. The separate property of a Hindu coparcener ceases to be his separate  property and acquires the characteristics  of  his joint  family  or  ancestral property, not by  mere  act  of physical mixing with his joint family or ancestral  property but  by  his own volition and intention, by his  waiving  or surrendering  his special right in it as separate  property. Mere  recitals  in deeds dealing with self  acquisitions  as ancestral joint family property is not by itself sufficient; but it must be established that there was a clear  intention on  the  part  of  the  coparcener  to  waive  his  separate property.[470  B-c] Hurpurshad  v.  Sheo  Dyal,  3 I.A.  219.   Lal  Bahadur  v. Kanhaiya  Lai, 34. I.A. 65, Lola Muddun Gopal  v.  Khikhinda Koeri 18 I.A. 9, Naina Pilla v. Daiyanai Ammal, A.I.R.  1936 Mad. 177, referred to. where there is a concurrent finding of both the lower courts that the business is a separate business and it is neither a joint family business nor treated as joint family  business, it is not open to further scrutiny by this Court under  Art. 133 of the, Constitution. [467 A-B]

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JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 613 of 1965. Appeal from the judgment and decree dated March 25, 1960  of the Mysore High Court in Regular Appeal No. 155 of 1953. V. Krishnamurthy and R. Gopdlakrishnan, for the appellant. H.   R.  Gokhale,  B.  Subbiah  and  R.  Thiagaraian,   for, respondents Nos. 2 and 4. The Judgment of the Court was delivered by Ramaswami,  J. The plaintiff G. Narayana Raju filed O.S.  34 of  1951-52  in  the Court of  District  Judge,  Mysore  for partition   and  separate  possession  of  suit   properties mentioned in the various schedules of the plaint.  The first defendant is the brother 465 of  the  plaintiff.  The second defendant is  the  widow  of Muniswami  Raju, the eldest brother of the  plaintiff.   The third   defendant  is  the  legal  representative   of   the plaintiffs  mother.  She is now the, appellant  having  been brought  on  record  as  the  legal  representative  of  the deceased  plaintiff. The case of the original plaintiff  was that he, the first defendant and Muniswami Raju (husband  of the  second defendant) were the sons of one Gopala Raju  and were all members of the joint family Gopalaraju died in  May 1931  and  after his death the plaintiff  and  his  brothers continued  to  be members of the joint  family.   The  joint status  of  the,  family  was severed  by  the  issue  of  a registered notice by the first defendant to the plaintiff in July 1951.  An ancestral house in Nazar bad belonging to the family was acquired by the City IuprovementTrust Board in or about the year 1909.  Out of the compensation paid for  that house and supplemented by the earnings of the members of the joint  family, the house item No. I of Schedule ’A’  to  the plaint  was  purchased by Gopalaraju in or  about  the  year 1910.   Subsequently  item No. 2 of Schedule  ’A’  was  also purchased by Gopalaraju from the income of item No. I supple mented  by the earnings of the members of the  family.   All the other items of properties mentioned in Schedule ’A’  and other Schedules attached to the plaint were acquired out  of the  income  from  items 1 and 2 of  Schedule  ’A’,  It  was further  alleged that the business known as "Ambika  Stores" was  also the joint family business and all  the  properties mentioned in the Schedules except items I and 2 of  Schedule ’A’  were acquired out of the income of the members  of  the family  including  the income from the  business  of  Ambika Stores.   The plaintiff accordingly claimed that he and  the first defendant would each be entitled to get 5/14ths  share and  the second and third defendants would each be  entitled to  get  2/14ths. share.  In the alternative  the  plaintiff pleaded  that  if  for any reason the Court  held  that  the properties stand in the name of Muniswami Raju and were  not acquired with the aidof the joint familv nucleus, he and the second defendant were entitled to equal shares as  co-owners of the joint family business.  The suit was mainly contested by  the  second defendant who asserted that  the  properties mentioned  in  all the Schedules of the  plaint  were  self- acquisitions of Miiniswami Raju and constituted his separate properties.  It was alleged that Muniswami Raju was the only carniiig member of the family at the time of the acquisition of items 1 and 2 of Schedule operties and the plaintiff  and the  first defendant were emploved,in petty jobs  in  Wesley Press.   Muniswami Raju later on employed the  plaintiff  in his  -shop  as  a salaried servant and  the  latter  had  no

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proprietary  right in the business of Ambika Stores.   After consideration  of  the  oral and  documentary  evidence  the District Judge held that the plaintiff, first defendant  and Muniswami  Raju were not divided and that the only  property which was divisible was item No. I of Schedule 466 ’A’  and  there  was not sufficient  ancestral  nucleus  for acquisition of the other properties and that all  properties except item No. 1 of Schedule ’A were the self  acquisitions of  Muniswami Raju, that Muniswami I Raju never blended  his properties with that of the joint family that the  plaintiff was  only an employee under Muniswami Raju and therefore  he was not entitled to the alternativ ’ relief claimed by  him. Accordingly, the District Judge granted a preliminary decree holding  that the plaintiff was entitled to 2/7ths share  in item  No. I of Schedule ’A’.  The plaintiff took the  matter in  appeal to the Mysore High Court.  By its judgment  dated March  25,  1960 the High Court affirmed the decree  of  the trial court with the modification that besides item No. I of Schedule  ’A’  item No. 2 also should be hold  to  be  joint family property and the plaintiff was entitled to  partition of  his share in this item also.  The High  Court  cancelled the  I  direction of the District Judge that  the  plaintiff should  account for the moneys and properties  of  Muniswami Raju  -in  his hands before he is given  possession  of  his share. This  appeal  is  brought by certificate on  behalf  of  the plaintiff  from the judgment of the Mysore High Court  dated March 25, 1960 in R.A. No. 155 of 1953. The  first  question  to be considered  in  this  appeal  is whether  the  business  of  Ambika  Stores  was  really  the business  of the joint family and whether the plaintiff  was entitled. to a partition of his share in the assets of  that business.: It was contended on behalf of the appellant  that the  business of Ambika Stores grew out of a nucleus of  the joint family funds of at least by the efforts of the members of  the joint family include the appellant.  The  contention of the appellant has been negatived by both the lower courts and there is a concurrent finding that the Ambika Stores was the  separate business of Muniswami Raju and it was  neither the  joint  family  business nor  treated  as  joint  family business, It is wellestablished that there is no presumption under Hindu law that a business standing in the name of  any member  of the joint family is a joint family business  even if that member is the manager, of the joint family.  Unless, it  could  be shown that the business in the  hands  of  the coparcener  grew up with the assistance of the joint  family property  or joint family funds or that the earnings of  the business  were  blended with the joint  family  estate,  the business remains free and separate.  The question  therefore whether  the  business  was begun or  carried  on  with  the assistance of joint family property or joint family funds or as  a  -family  business is a  question  of  fact.-(See  the decisions of the Judicial Committee in Bhwu Mal v. Jagannath (1)  and in Pearey Lal v. Nanak Chand (1) and of this  Court in Chattahatha Karayalar v. Ramachandra (1)   A.T.R 1943 P.C 40. (2)   A.T.R. 1948 P.C  108. 467 lyer)  (1).   In  the present, case there  is  a  concurrent finding of both the lower courts that the business of Ambika Stores  was a separate, business of Muniswami Raju  and  it, was  neither  a joint family business nor treated  as  joint family business.  The concurrent finding of the lower courts on  this issue is upon a finding of fact and  following  the

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usual practice of this Court, it is not now open to  further scrutiny by this Court under Art. 133 of the Constitution. It  was, however, contended on behalf of the appellant  that the finding of the lower. courts is vitiated in, law because of  the circumstance that they have not taken  into  account three important documents, Ex.  D, Ex.  E and Ex.  DDD.   We are  unable  to  accept this argument  as  correct.   It  is manifest on a perusal of the judgment of the High Court that all  the documents have been examined, regarding  the  issue whether  the  business of Ambika Stores was a  joint  family business  or whether it was p. separate, business  of  Muni- swami  Raju.  As regards Ex.  D, the High-,Court has,  after examining the evidence adduced, remarked that the, mere fact that  item No. 2 of Schedule ’A was given as a  security  by Muniswami Raju did not result in any detriment to the  joint family  property and, it cannot therefore be held  that  the business of Ambika Stores grew out of the joint family funds or with the aid of the joint family funds.  On behalf of the appellant  reliance was placed on the recitals in Ex.  E,  a deed of mortgage dated July 26, 1928 executed by Gopalaraju, Muniswamiraju  and  the appellant in favour  of  the  Mysore Bank.   The  property  that had been  mortgaged  under  this document is item No. 2 of Schedule ’A’.  The recital is that the  borrowing from the Bank was for the business and  trade of  the  executants and -for the benefit and  use  of  their family.   There is also a recital in an earlier  portion  of the document that the business, was being carried on for the benefit  of  the  family, but it is not quite  clear  as  to whether this related to the business carried on by  Narayana Raju  or whether it was intended to relate to some  business carried on by all the three executants.  It is possible that the  appellant had other business of his own carried on  -on his own. account at that time and it cannot be, assumed that the borrowing under Ex.  E must have been for the purpose of Ambika  Stores.  It should be noticed that  Muniswarni  Raju has  been  described in the document as  the  proprietor  of Ambika Stores which description is. not consistent with  the contention  of the appellant that the business, was a  joint family  business.  The High Court has, in  this  connection, referred  to Ex.  I an application dated February 14,  1929, by  the  appellant  to the City  Co-operative  Bank,  Mysore wherein, the appellant has said that he was getting a decent earning  by  doing;  out-of-door  commercial  business  with Ambika  Stores.  There is also the, recital in Ex.   I  that Muniswami Raju was the proprietor of Ambika Stores.   Having regard to this recital in I it is not- (1)  A.I.R. 1955 S.C. 799. 468 unlikely that the appellant had some business of his own  at the  material time and it cannot be assumed  that  borrowing under Ex.  E, was for the purpose of Ambika Stores  business only.  The High Court has also dealt with the effect of  Ex. DDD, mortgage deed produced on behalf of the appellant.   It is  true that in this document the appellant  and  Muniswami Raju  have been described as proprietors of  Ambika  Stores. The finding of the High Court is that this recital was  made in the document for the purposes of borrowing from the Bank. Reference was made in this context to a letter dated May  5, 1931,  Ex.  75 written by Muniswami Raju  as  proprietor  of Ambika  Stores to the Bank of Mysore.  In’ this  letter,  he has requested the Bank to take note of the fact that he  has authorised the appellant to accept drafts, and sign  letters etc. on behalf of the firm’ There is another Letter, Ex. 76, dated  April 14, 1934 written by Muniswami Raju to the  Bank of  Mysore wherein Muniswami Raju has been described as  the

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proprietor  of Ambika Stores and there is an  intimation  to the Bank, that the appellant Narayana Raju was authorised to sign  for the firm.  In the context and background of  these circumstances  it is evident that though both the  appellant and  Muniswami Raju were described as proprietors of  Ambika Stores the description was only for the purpose of borrowing money  from the Bank, as contended for by  the  respondents. In  this  connection  the High Court  has  also  taken  into account Ex. 7 5 (b), a letter written by Muniswami Raju.  In this  letter  Muniswami Raju has described  himself  as  the proprietor of Ambika Stores and has instructed the Bank that he  has  cancelled the authority given to the  appellant  to operate  one  his  Current Account with  the  Bank.   It  is therefore  not possible for us to accept the  contention  of the  appellant that the finding of the High Court  that  the business  of  Ambika Stores was the  exclusive  business  of Muniswami Raju is vitiated in law. On the other hand, it was contended on behalf of the respon- dents  that  the finding of the High Court is  supported  by proper evidence.  The business of Ambika Stores was  started by  Muniswamiraju as the proprietor thereof at a  time  when Muniswamiraju himself was comparatively well-off as a result of  his  partnership with Krishnaswamy Chetty & Co.  In  the year  1925 the partnership of Krishnaswamy Chetty & Co.  was dissolved by a document Ex. D. The entire business with ’all the  assets ad liabilities was taken over by Muniswami  Raju while the widow and son of Krishnaswamy Chetty were given  a house estimated by the appellant himself at Rs. 3,000/-  and furniture worth Rs. 400/-.  Muniswami Raju changed the  name of  the  ’shop after taking it over into Ambika  Stores  and continued the business as is apparent from Exs.  XVIII, XXVI and XXVI(A).  There- is also evidence that at the time  when Ambika Stores was started other members of the family  we’re not in a financial position to make any contribution to pur- 469 such a business.  The appellant joined Wesley Press in  1912 on a salary of Rs. 8 or Rs. 9 p.m. and he was drawing Rs. 27 p.m.  in  1927 when he resigned from the Press.   The  first defendant  joined Wesle Press in 1910 on a salary of Rs.  10 p.m.   and  he  was  continuing  to  work  there  till   the institution of the present suit.  ’Me income of the property item  No. 2 of’ Schedule ’A’ was Rs. 15 p.m. and the  income from  pounding  rice  for which  there  is  no  satisfactory evidence  was also negligible.  Therefore, the  earnings  of the  members  of the family other than Muniswami  Raju  were hardly sufficiently to maintain the family at the time  when the  business of Ambika Stores was started.  The High  Court has  found that the family did not have  sufficient  nucleus and  that Muniswami Raju was not a partner  of  Krishnaswamy Chetty  &  Co.  on behalf of the family but that  he  was  a partner in his own right.  The High Court has observed  that there  is no evidence to show that the family  supplied  the money or that the family had enough means or that  Muniswami Raju  was  representing  the  family  when  he  started  the business  of  Ambika Stores.  As we have already  said,  the finding  of  the High Court and of the District Judge  is  a concurrent  finding  on a question of fact  and  Counsel  on behalf  of  the appellant has been unable to make  good  his argument that the finding is vitiated in law on any account. We pass on to consider the alternative argument put  forward on  behalf  of  the  appellant, namely,  that  even  if  the business  of  Ambika  Stores  was  started  as,  a  separate business  of  Muniswami  Raju,  it  became  converted  at  a subsequent stage into joint family business.  It was  argued on  behalf  of  the appellant that the  business  of  Ambika

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Stores  was thrown by Muniswami Raju into the  common  stock with  the intention of abandoning all separate claims to  it and  therefore  the  business  of  Ambika  Stores  lost  its character of a separate property and was impressed with  the character   of  joint  family  property.   It  is  a   well- established  doctrine of Hindu law that property  which  was originally self-acquired may become joint property if it has been  voluntarily  thrown by the coparcener into  the  joint stock  with the intention of abandoning all separate  claims upon it.  The doctrine has been repeatedly recognized by the Judicial Committee [See Hurpurshad v. Shea Dayal(1) and  Lal Bahadur  v. ’Kanhaiya Lal(-).  But the question whether  the coparcener has done so or not is entirely a question of fact to  be decided in the light of all the circumstances of  the case.   It  must  be  established that  there  was  a  clear intention  on  the  part  of the  copareener  to  waive  his separate  rights and such an intention will not be  inferred merely from acts which may have been done, from kindness  or affection  [See  the  decision  in  Lata  Muddun  Gopat   v. Khikhinda  Koer  (3).   For instance,  in  Naina  Piltal  v. Daiyanai (1) 3 I.A. 259.        (2) 34 I. A. 65. (3) 18 I. A. 9. 470 Ammal,  (1)  where in a series of  documents,  self-acouired property  was  described and dealt with  as  ancestral-joint family   it was held by the Madras High Court that the  mere dealing with self-acquisitions as joint family property  was not  sufficient but an intention of the coparcener  must  be shown  to waive his claims with full knowledge of his  right to it as his separate property.  The important point to keep in mind, is that the separate property of a Hindu coparcener ceases  to  be  his  separate  property  and  -acquires  the characteristics  of his joint family or ancestral  property, not by mere act of physical mixing with his joint family  or ancestral  property, but by his own volition and  intention, by  his  waiving  or surrendering his special  right  it  as separate  prop".  A man’s intention can be  discovered  only from-  his words or from his acts I and conduct.   When  his inention  with  regard  to  his  separate  property  is  not expressed  in  words, we must seek for it in  his  acts  and conduct.  But it is the intention that we must seek in every case, I the acts and conduct being no more than evidence  of the  intention.  - In the present case, the High  Court  has examined the evidence adduced by the parties and has reached the  conclusion that there was no intention on the  part  of Muniswami  Raju  to throw the separate  business  of  Ambika Stores  into the common stock, nor was it his  intention  to treat  it as a joint family business.  Counsel on behalf  of the appellant referred to the recital, in Ex.  E  describing the  properties being those of the executants and  that  the borrowings  was for trade and benefit of the family  and  it was argued that there was a clear intention on the part  of. Muniswaini  Raju  to  treat the  business  as  joint  family business.   We  have already referred to this  document  and indicated  that  the  recitals were probably  made  for  the -purpose  of  securing  a loan and cannot  be  construed  as consent  on the part of the members of the joint  family  to treat  the business as the joint family business.   Further, there is ample evidence to show that in all succeeding years before his death Muniswami Raju had always described himself and  conducted  himself  as the sole  proprietor  of  Ambika Stores,  Such an attitude on the part of Muniswami Raju  was not  consistent  with any intention on his  part  either  to abandon his exclusive right to the business or to allow  the

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business’ to be treated as joint family business.   Exhibits XXXV to XLVI are all documents executed by third parties  in favour  of Muniswami Raju in which Muniswami Raju  has  been described as the proprietor of Ambika Stores.  Exhibits III, XXIII, XXIV, 51, 52, 56, 58, ZZ, AAA series and BBB -are all communications addressed by institutions like Banks etc., in which Muniswwni Raju has been described as the proprietor of Ambika Stores.  It may be stated that the appellant  himself has  admitted  in his evidence that he was not  drawing  any moneys from the business of Ambika Stores and that  whenever he wanted any_money, he would ask Muniswami Raju and obtain (1)  A.I.R. 1936 Mad .177. 471 from him.  If really the appellant had considered himself to be  I co-owner equally with Muniswami Raju, such conduct  on his  part is not explicable. it was urged on behalf  of  the appellant  that  there was no documentary evidence  to  show that  the  appellant was being paid  any  salary  ’Muniswami Raju,  and that prior to Muniswami Raju’s death, it was  the appellant who was in the entire management of Ambike  stores when Muniswami Raju was ill and after the death of Muniswami Raju  also it was the appellant who had been in  management. Al,  the books of account and other documents pertaining  to the business of Ambika Stores had been admittedly  entrusted to the appellant.  But it is not explained on behalf of  the appellant  as to why the documents were not produced on  his behalf to disprove the Case of the respondents that he was a salaried servant.  It is therefore not unreasonable to  draw an  inference  from the conduct of the  appellant  that  the Account  Books,  if  produced  in  court,  would  not   have supported  his case.  We accordingly reject the argument  of the  appellant  that the business of  Ambika  Stores  became converted into joint family business at any subsequent stage by  the conduct of Muniswami Raju in throwing  the  business into  the  common stock or in blending the earnings  of  the business with the joint family income. it was finally contended on behalf of the appellant that, in any  event, the appellant became a co-owner of the  business along  with Muniswami Raju by reason of contribution of  his own labour towards the development of the business.  In  our opinion,  there  is no substance in this  argument.   It  is evident  that the appellant gave up his job in Wesley  Press and  joined Ambika Stores about 9 or 10 months after it  was started by Muniswami Raju.  The appellant does not state  in his  evidence that he was a co-owner when he  joined  Ambika Stores.   On  the  other  hand,  in  Ex.  68  which  is   an application  dated  March 20, 1928 by the appellant  to  the City Co-operative Bank, the appellant has described  himself as  a  clerk in Ambika Stores and Muniswami  Raju  has  been described  as  his  proprietor.  There  is  no  satisfactory evidence  on behalf of the appellant to show as to when  and under -which circumstances his status of a clerk changed  to that of a co-owner.  In another application, Ex.  I which is of the year 1929 the appellant has described Muniswami  Raju as  the  Proprietor of Ambika Stores and  he  has  described himself  as doing out-door commercial business  with  Ambika Stores.   Again, in Ex.  C which is a loan application  made in  1932  by  both the brothers,  Muniswami  Raju  has  been described  as  the  proprietor of Ambika  Stores  while  the appellant  has  been  described as  a  General  Merchant  of Mysore.   Reference was made on behalf of the  appellant  to recitals in Ex.  DDD, a mortgage deed dated June 20, 1934 in which  Muniswami Raju and the appellant have been  described as proprietors of Ambika Stores.  We have already dealt with this, document and for the reasons already mentioned we hold

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that the description of the 472 executants was only given for the purpose of borrowing  from the  Bank  and  it had not the legal effect  of  making  the appellant . co-owner of the partnership business.  There  is no  evidence  of  any  assertion  by  the  appellant  during Muniswami  Raju’s life-time of his being a co-owner  of  the partnership   business,  nor  is  there  any   evidence   of recognition  by  Muniswami  Raju of any such  right  of  the appellant.  On the other hand, there is sufficient  evidence to  show that whatever the appellant did in connection  with the  business  was only done with the Authority  conferd  by Muniswami  Raju.  In our opinion the High Court has  rightly rejected  the claim of the appellant that he was a  co-owner of the partnership business. For  the  reason expressed we hold that this appeal  has  no merit and it must be dismissed with costs. R.K.P.S.               Appeal dismissed. 473