The Supreme Court has set aside a Karnataka High Court judgment that had allowed a partition suit concerning ancestral property sold by the karta. While examining Ancestral Property Legal Necessity, the Court found that the plaintiffs failed to establish that the sale lacked legal necessity. It also drew an adverse inference from the failure of the karta’s wife to enter the witness box despite her knowledge of the family’s financial circumstances.
A bench of Justice Augustine George Masih and Justice Sandeep Mehta considered an appeal filed by the purchaser of the suit properties. The appellant challenged the Karnataka High Court’s 2010 judgment, which had reversed the trial court’s dismissal of a partition suit filed by the wife and two sons of Renukaiah.
Renukaiah Sold Two Properties In 1993
Renukaiah received six items of land through a family partition in 1983. In 1993, he sold two of those properties to address financial difficulties. The sale deed also recorded this reason for the transaction.
The properties subsequently changed hands through several transactions. The appellant purchased them while the partition suit remained pending.
After Renukaiah’s death, his wife and two sons instituted a suit for partition. However, they confined their claim to only two of the six properties that Renukaiah had received through the family partition.
The plaintiffs alleged that Renukaiah had sold the properties without legal necessity and without obtaining their consent.
The trial court dismissed the suit after examining the evidence. It found that Renukaiah had used the sale proceeds to repay a loan taken for constructing a house.
The plaintiffs then approached the Karnataka High Court. The High Court reversed the trial court’s decision and relied on the son’s testimony that Renukaiah was addicted to gambling and drinking.
The purchaser challenged the High Court’s judgment before the Supreme Court.
Plaintiffs Did Not Challenge Registered Sale Deed
The Supreme Court noted that the plaintiffs never challenged the validity of the registered sale deed. The Court therefore considered the recitals in the document significant while examining the circumstances surrounding the transaction.
The bench also scrutinised the testimony of the son, PW 1, who served as the sole witness for the plaintiffs. During cross-examination, he admitted that unnamed persons had told him that the property carried a higher value.
However, the plaintiffs produced no documentary or official evidence to establish the market value of the properties.
The Court also found no independent evidence to support the allegation that Renukaiah had gambling and drinking habits.
PW 1 admitted that his mother, PW 3, knew about Renukaiah’s alleged habits. The Supreme Court therefore considered her absence from the witness box significant.
The bench observed:
“The plaintiffs, therefore, should have examined respondent/plaintiff No. 3 if they were intending to establish the said allegation and the circumstances in which the sale was effected, but consciously chose not to do so.”
The Court noted that Renukaiah’s wife would have possessed personal knowledge of the family’s financial affairs. Since the plaintiffs chose not to examine her, the Court drew an adverse inference against them.
Supreme Court Examines Legal Necessity
While considering Ancestral Property Legal Necessity, the Supreme Court also examined the selective manner in which the plaintiffs framed their partition claim.
Renukaiah had inherited six properties, but the plaintiffs sought partition of only two. They excluded four other properties that Renukaiah had admittedly sold to their paternal uncle. The Court also noted that the plaintiffs had filed the suit at the instance of that uncle.
Further, the plaintiffs did not seek cancellation of the sale deed. The Supreme Court considered this omission along with the other circumstances and found that these factors weakened their case.
The bench observed:
“These circumstances, taken together, materially affect the basis upon which respondent Nos. 1-3/plaintiffs sought relief of partition in respect of the suit schedule properties.”
High Court’s Judgment Set Aside
The Supreme Court found that the Karnataka High Court had interfered with a well-reasoned trial court judgment primarily on the strength of an unsupported allegation.
The trial court had examined the evidence and concluded that Renukaiah used the sale proceeds to discharge a loan incurred for constructing the Bengaluru house.
The Supreme Court held:
“Having regard to the facts and circumstances noticed hereinabove, we are of the considered view that the impugned judgment of the High Court does not withstand judicial scrutiny. The judgment of the trial Court, dismissing the suit for partition upon appreciation of the evidence and holding that the sale proceeds had been utilised towards discharge of the loan incurred for construction of the Bengaluru house, was based on a plausible and reasoned appreciation of the material on record. The High Court, in our view, was not justified in interfering with the same merely on the basis of the unsubstantiated allegation regarding the alleged vices of Renukaiah.”
Accordingly, the Supreme Court set aside the Karnataka High Court’s judgment and restored the trial court’s judgment dismissing the partition suit.
