Madras High Court
Sivaprakash vs The Branch Manager on 17 October, 2025
S.A.No.765 of 2019
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Reserved on 13.08.2025
Pronounced on 17.10.2025
Coram:
The Honourable Mrs.Justice K.GOVINDARAJAN THILAKAVADI
Second Appeal No.765 of 2019
and C.M.P.No.14839 of 2019
1.Sivaprakash
2.Anitha
... Appellants
versus
1.The Branch Manager,
TamilNadu Industrial Investment Corporation Ltd.,
Dharmapuri, Pennagaram Road,
Dharmapuri Taluk & District.
2.Duraisamy
3.Balaji
.. Respondents
1
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S.A.No.765 of 2019
Prayer: Second Appeal is filed under Section 100 CPC, praying to set aside
the judgment and decree dated 17.02.2015 made in A.S.No.18 of 2013 on
the file of Additional District Judge, Dharmapuri, reversing the judgment
and decree dated 13.08.2012 made in O.S.No.103 of 2002 on the file of
Subordinate Judge, Dharmapuri.
For Appellants : Mr.S.Mukunth, Senior Advocate
for Mr.K.S.Karthik Raja
For Respondent : Mr.K.Magesh for R1
No appearance for R2 and R3
JUDGMENT
The above second appeal arises out of the judgment and decree dated
17.02.20151 made in A.S.No.18 of 2013 on the file of learned Additional
District Judge, Dharmapuri, reversing the judgment and decree dated
13.08.2012 made in O.S.No.103 of 2002 on the file of Subordinate Judge,
Dharmapuri.
2. The appellants are the plaintiffs in O.S.No.103 of 2002 on the file
of Subordinate Judge, Dharmapuri. They have filed the said suit for the
relief of partition, separate possession and for permanent injunction.
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3.The case of the plaintiffs is that they are the children of the 1st
defendant/2nd respondent. The suit property belongs to the Hindu Joint
family of the plaintiffs and defendants 1 and 2/respondents. The property
has been inherited by the 1st defendant as per the Partition deed entered
between the 1st defendant and his family members on 11.10.1976 and
through the said partition deed, the 1st defendant became the owner of the
suit property. He has constructed a Theatre in the suit property by way of
selling some of his properties allotted to him. Thereafter, the defendants 1
and 2 were leading a luxurious life and they were creating encumbrance
over the joint family properties. On 16.4.2002, the plaintiffs came to know
that the defendants 1 and 2 have mortgaged the suit property to the 3rd
defendant as a security for the loan obtained by M/s.Sri Ram Gas Agency
and since the said mortgage was not discharged, the 3rd defendant was
attempting to take legal action against the property. Since the loan was not
obtained for any legal necessity or for clearing antecedent debts, the said
mortgage is not binding on the plaintiffs. Hence, the plaintiffs have come
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forward with the present suit for partition.
4.The claim of the plaintiff was resisted by the 3rd defendant stating
that 1st and 2nd defendant offered the suit property as a collateral security
for the loan obtained by one Mr. Venkatasubramaniam of Kariyamangalam
by creating equitable mortgage over the suit property and deposited the title
deeds. The security was extended from time to time. The 1st defendant
created the mortgage on behalf of the minors also being the Kartha of the
family. The mortgage executed by 1st and 2nd defendants are valid one.
Since the borrower failed to repay the loan amount, the 3rd defendant
initiated proceedings under Section 29 of the State Financial Corporation
Act and the 3rd defendant is having every right to initiate recovery
proceedings against the suit property and bring the same for auction sale. As
the liability of the borrower and surety is co-extensive, the defendants 1 and
2 are bound to repay the loan amount. The plaintiffs and the defendants 1
and 2 collusively filed the present suit in order to defraud the 3 rd defendant.
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The suit has been filed with malafide intention to deprive the right of the 3 rd
defendant who is a public undertaking. The defendants 1 and 2 stood ex-
parte in the suit which itself shows the collusiveness in between them. The
1st defendant has already sold some of the properties to third parties and
none of them have been added as a party in this proceedings and the
plaintiffs are not entitled for partial partition. The action of the Kartha will
bind the minors. Under these circumstances the mortgage created by the 1st
and 2nd defendant is valid and according to law and the suit has to be
dismissed with cost. Hence, prayed for dismissal of the suit.
5.The trial Court based on the pleadings and evidence and arguments
advanced by the respective counsel decreed the suit in favour of the
plaintiff. Aggrieved by this, the 3rd defendant has preferred an appeal in
A.S.No.18 of 2013 on the file of the Additional District Court, Dharmapuri
which reversed the judgement and decree passed by the trial Court in
O.S.No.103 of 2002 dated 13.08.2012. Aggrieved by the said Judgment and
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decree passed by the First Appellate Court, the present second appeal is
preferred by the plaintiff.
6.The learned counsel appearing for the plaintiffs submits that the
suit properties are ancestral properties of the plaintiffs and the same can be
sold or mortgaged by Kartha only for the imminent necessity of the joint
family or to clear the family debts and not for any other purposes. While so,
there is nothing on record to show that the suit properties were mortgaged
to the 3rd defendant by the defendants 1 & 2 for imminent necessity of the
joint family or to clear family debts. The 1st Appellate Court erred in
dismissing the suit filed by the plaintiffs by holding that the suit is bad for
partial partition. It is further submitted that it is an admitted fact that the suit
properties were mortgaged by the defendants 1 and 2 only as a security to
the loan obtained by M/s. Sri Ram Gas Agencies by its proprietor
Venkatasubramanian and hence, the same cannot be construed as one
obtained to discharge antecedent debts. In such circumstances, the mortgage
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of the suit properties by the defendants 1 and 2 is not valid in the eye of law
and therefore, the plaintiffs are entitled for a share in the said properties. It
is further submitted that without any pleading or evidence, the First
Appellate Court dismissed the suit filed by the plaintiffs by holding that the
suit is barred for partial partition. The issue for partial partition is totally
based on pleadings and evidences and therefore, mere admission of parties
as to partial partition will not suffice and the issue of partial partition
cannot be considered at appellate stage directly without being raised in the
written statement as a defence by the 3rd defendant. To support his
contention he has relied upon the following decision cases of:
i) G.Maharajan Asari Vs. G.Natarajan Asari reported in 2011
(2) CTC 527
ii) Bachhaj Nahar Vs Nilima Mandal and another reported in
(2008) 17 SCC 491
iii) Tmt. Geetha and another Vs Tmt. B. Santha and others in
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O.S.A. No. 22 of 2011 of this Court and,
iv) P.P. Mathivanan Vs. P.P. Jayalakshmi and others in A.S.
483/2011 of this Court.
Hence, prayed for setting aside the judgment and decree passed by
the First Appellate Court in A.S.No.18 of 2013.
7.On the other hand, the learned counsel appearing for the 3 rd
defendant would submit that there was a term loan granted to one
Venkatasubramanian and Malathi on 28.08.1997 and defendants 1 and 2
stood as guarantors for the above said loan. It is submitted that the above
persons were running a Gas Agency in the name and Style of ''M/S. Sri Ram
Gas Agency at Kariyamangalam.'' The 1st defendant i.e father of the
appellants, had created equitable mortgage on behalf of himself and on
behalf of the minors and the mortgage deed has been executed on
17.11.1997. Since the amount was not been repaid, the 3rd defendant under
Section 29 of State Financial Corporation Act issued notice to the
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defendants 1 and 2/respondents for taking possession of the suit property
and for sale on 16.04.2002. In order to defraud the loan amount, the
defendants 1 and 2/respondents collusively joined with the plaintiffs 1 and 2
filed the above suit for partition and for injunction against the 3rd defendant.
He would further submit that since it is a suit for partition, the 3rd defendant
is not a necessary party to the proceedings and the suit is bad for mis-joinder
of parties. He would further submit that when a proceedings initiated as
against the defendants 1 and 2/respondents under Section 29 of the State
Financial Corporation Act, the Civil Court has no right to grant injunction
against the said proceedings. The trial Court failed to note that the 3rd
defendant has filed S.F.C.O.P.No.10 of 2011 before the Principle District
Court, Dharmapuri and the above proceedings are still pending before the
said Court. The learned counsel would further submit that with regard to
undivided ancestral properties, under Sections 6, 8 & 12 of the Hindu
Minority and Guardianship Act of 1956, in Joint family property a
Kartha/adult members of a Joint Hindu Family Act can sell / dispose of
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Joint Family property involving undivided interest of minor of the family.
Hence, Section 8 of Hindu Minority and Guardianship Act of 1956, is not
attracted to such sale or disposal and that Section 8 of the Act has to be
read conjointly with Section 6 and 12 of the Act. To support his contention,
he has relied upon the judgment in the case of Sri Narayan Bal and others
Vs. Sridhar Sutar and others reported in (1996) 8 SCC 54. The First
Appellate Court has appreciated the materials on record in a right
prospective manner which calls for no interference by this Court. Hence,
prayed for dismissal of the second appeal filed by the plaintiffs.
8.Heard on both sides and records perused.
9.It is not in dispute that the suit properties are the joint family
properties of the plaintiffs and defendants 1 and 2 and that the 1 st defendant
created an equitable mortgage in respect of the suit property on 17.11.1997
as collateral security for the term loan granted to M/s.Sri Ram Gas Agency.
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The plaintiffs have assailed the said mortgage by stating that, the same was
not executed for any legal necessity or for the benefit of the plaintiffs.
Hence, they filed the above suit for partition.
10. On the other hand, the 3rd defendant would contend that in order
to defraud the loan amount, the plaintiffs and the defendants 1 and 2 have
collusively filed the above suit for partition and injunction as against the 3rd
defendant. It is not in dispute that the 3rd defendant has initiated recovery
proceedings under Section 29 of the State Financial Corporation Act against
the suit property.
11.Admittedly, the plaintiffs and the defendants were in joint
possession of the suit properties. In the suit, the defendants 1 and 2
remained absent. It is settled law that, the jurisdiction of a Civil Court to
entertain a partition suit can be barred if the property has been subjected to
recovery proceedings under special legislation, which gives financial
corporations extensive powers to recover debts and no injunction could be
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granted against such action. However, a partition suit can be decided only
by a civil suit. Where as, a recovery proceedings under the SFC Act are
adjudicated by specialized Tribunals. But, the recovery proceedings
initiated by the SFC generally precedence over a partition suit. A decree in a
partition suit does not bind or over ride the proceedings before the
specialized Tribunals such as DRT etc. The Tribunal can proceeds with its
recovery action even if a partition suit is pending.
12.Now, it has to be seen whether, the 1st defendant as Kartha of the
Hindu undivided family can sell / dispose of joint family property involving
undivided interest of minor of the family. With regard to the undivided
interest of the Hindu Minor in Joint family property, Sections 6, 8 and 12 of
the Hindu Minority and Guardianship Act, 1956 are beads of the same
string and need to be viewed in a single glimpse, simultaneously in
conjunction with each other. Each provision and in particular Section 8,
cannot be viewed in isolation. If read together the intent of the legislature in
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this beneficial legislation becomes manifest. Ordinarily the law does not
envisage a natural guardian of the undivided interest of a Hindu minor in
joint family property. The natural guardian of the property of a Hindu
minor, other than the undivided interest in joint family property, is alone
contemplated under Section 8, where under his powers and duties are
defined. Section 12 carves out an exception to the rule that should there be
no adult member of the joint family in management of the joint family
property, in which the minor has an undivided interest, a guardian may be
appointed; but ordinarily no guardian shall be appointed for such undivided
interest of the minor. The adult member of the family in the management of
the joint Hindu family property may be a male or a female, not necessarily
the Karta. The power of the High Court otherwise to appoint a guardian, in
situations justifying, has been preserved. This is the legislative scheme on
the subject. Under Section 8 a natural guardian of the property of the Hindu
minor, before he disposes of any immovable property of the minor, must
seek permission of the court. But since there need be no natural guardian for
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the minor's undivided interest in the joint family property, as provided under
Sections 6 and 12 of the Act, the previous permission of the court under
Section 8 for disposing of the undivided interest of the minor in the joint
family property is not required. The joint Hindu family by itself is a legal
entity capable of acting through its Karta and other adult members of the
family in management of the joint Hindu family property. Thus Section 8 in
view of the express terms of Sections 6 and 12, would not be applicable
where a joint Hindu family property is sold/disposed of by the Karta
involving an undivided interest of the minor in the said joint Hindu family
property. [Ref (1996) 8 Supreme Court 54]: Hence, Section 8 of Hindu
Minority and Guardianship Act, 1956, is not attracted to such transaction
and that Section 8 of the Act has to be read conjointly with Section 6 and 12
of the Act.
13. But, in the instant case, the materials on record is suffice to show
that the alleged mortgage was not executed for the benefit of the plaintiffs.
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However, the plaintiffs must approach the Court with clean hands.
Conveniently, they haven't included the other properties available for
partition. They have included the property which was subject matter of the
recovery proceedings. Moreover, the defendants 1 and 2 remained absent in
the suit. Hence, it is made clear that the suit has been filed with malafide
intention to deprive the right of the 3rd defendant who is a Public
undertaking. Though, the lower Court dismissed the suit on the ground of
partial partition, the intention of the plaintiffs has to be taken into
consideration. Moreover, the 3rd defendant is a stranger and therefore, he
could not have raised the defence of partial partition in the written statement
unless the plaintiffs reveals the existence of other properties available for
partition. Therefore, I do not see any question of law much less a substantial
question of law in order to enable me to entertain this appeal. The First
Appellate Court has rightly dismissed the suit filed by the plaintiffs, which
warrants any interference by this Court.
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14.In the result,
(i) The Second appeal is dismissed. No costs.
(ii) The judgment and decree dated 17.02.2015 made in A.S.No.18 of
2013 on the file of learned District Judge, Dharmapuri, reversing the
judgment and decree dated 13.08.2012 made in O.S.No.103 of 2002 on the
file of Subordinate Judge, Dharmapuri is upheld. Consequently, connected
miscellaneous petition is closed.
17.10.2025
vsn
Index: Yes/No
Speaking order / Non-speaking order
To
1.The Additional District Judge, Dharmapuri
2. The Subordinate Judge, Dharmapur
3.The Section Officer, VR Section, High Court, Madras.
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K.GOVINDARAJAN THILAKAVADI,J.
vsn
Pre- delivery judgment made in
17.10.2025
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