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CAPTAIN RAJESH SETHI S.C. vs COL. P.C.SETHI & ANR

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* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Decision: 1st November, 2023

+ CS(OS) 436/2004 & IA No.1871/2021
CPT. RAJESH SETHI S.C.
S/o Col P.C. Sethi
R/o C-269, Defence Colony
New Delhi. ….. Plaintiff
Through: Mr.Arjun Mukherjee, Advocate.

Versus
1. COL. P.C. SETHI
S/o late Sh. Mool Chand Sethi
R/o C-269, Defence Colony
New Delhi.

2. SH. RAVINDER NANGIA
S/o Sh. S.G. Nangia
R/o C-500, Defence Colony
New Delhi.

3. SH. RAMAN SETHI
S/o Col P C. Sethi
R/o C-269, Defence Colony
New Delhi.

4. Sh. RAVI SETHI
110 Daly Road, Far Hills
New Jersey – 07931
USA. ….. Defendants
Through: Mr.Hrishikesh Baruah, Mr.Pranav Jain, Advocates for D-1
Mr.Ashish Mohan, Mr.Samarth Chaudhary and Ms.Gargi Sethee, Advocates for D-2.
Mr.Arjun Dewan and Mr.Varisha B. Advocates for defendants No.3 and 4.

+ CS(OS) 759/2004 & IA No.1643/2021

Sh. RAVINDER NANGIA
S/o Shri S.G. Nangia
R/o C-500, Defence Colony,
New Delhi. ….. Plaintiff
Through: Mr.Ashish Mohan, Mr.Samarth Chowdhary and Ms.Gargi Sethee, Advocates.
versus
1. Sh. PURAN CHAND SETHI
S/o Late Shri Mool chand Sethi
R/o C-269, Defence Colony,
NEW DELHI

2. Sh. RAMAN SETHI
S/o Col P C. Sethi
R/o C-269, Defence Colony
New Delhi. ….. Defendant
Through: Mr.Hrishikesh Baruah and Mr.Pranav Jain, Advocates for D-1
Mr.Arjun Dewan and Ms.Varisha B., Advocates for D-2.
CORAM:
HON’BLE MS. JUSTICE NEENA BANSAL KRISHNA
J U D G M E N T

CS(OS) 436/2004:
1. The plaintiff Capt. Rajesh Sethi, has filed a suit for Declaration that the Agreement to Sell dated 14.01.2004 executed by his father, Col. P.C. Sethi, defendant No.1 in favour of Shri Ravinder Nangia, defendant No.2 is void ab initio & non est, a Mandatory Injunction to direct defendant No.1 to cancel the Agreement to Sell and also Permanent Injunction to restrain the defendants from creating third party interest on the suit property in furtherance of the Agreement to Sell.
CS(OS) 759/2004:
2. A civil suit is filed by Sh. Ravinder Nangia (defendant no.2 in afore mentioned Civil Suit No CS(OS) 436/2000 ) seeking Specific Performance of Agreement to Sell dated 14.01.2004 entered into by him with Col. P. C. Sethi, and in the alternative specific performance in respect of the share of Col. P.C. Sethiub or a refund of Rs. 39,00,000/- & damages of Rs. 75,00,000/- along with interest @ 18% per annum.
3. All the parties are concordant that defendant No.1 Col. P. C. Sethi, who is the father of the plaintiff Capt. Rajesh Sethi, having lost all assets in Pakistan, had applied and obtained provisional allotment of a 325 sq. yards plot bearing No. C-269, Defence Colony, New Delhi (hereinafter referred to as the “suit property”) vide a Perpetual Lease. The possession of the plot was handed over to defendant No.1 on 13.05.1954 and the construction was carried out by Kilokri Defence Service Co-operative House Building Society Ltd. in January, 1955.
4. He entered into an Agreement to Sell dated 14.01.2004 for the sale of the suit property for a total consideration of Rs.2,74,00,000 (Rupees two crores seventy four lakhs) against which Rs.26,00,000 was paid at the time of signing the Agreement to Sell and further payment of Rs.13,00,000 was made on 22.01.2004. However, the circumstances leading to the signing of the Agreement to Sell and the events thereafter have come under challenge by way of these two suits.
5. The plaintiff in CS (OS) 436/2004, Captain Rajesh Sethi has claimed that the suit property was purchased partly out of the money received towards claims in respect of ancestral properties left behind in Pakistan and partly from loans which were paid from the sale of ancestral jewellery. It is an HUF property that was managed by his father, defendant No.1 Col. P.C. Sethi and has all along been reflected as a joint family property in the Income Tax Returns filed by defendant No.1 in the capacity of Karta of Col. P.C. Sethi, HUF (hereinafter referred to as “HUF”).
6. It is claimed that the Captain Rajesh Sethi as a coparcener of the HUF, has also contributed for the upkeep and maintenance of the property including having paid Conversion fee amounting to Rs.52,200/- vide cheque dated 03.08.1996 to get the property converted to freehold. It is further stated that defendant No.1 and his youngest son defendant No.3 Shri Raman Sethi resided in the suit property; however, after the marriage of defendant No. 3, he and his wife had an extremely acrimonial relationship with defendant No.1.
7. On 28.01.2004, Col. Ranjan Narang, a family friend enquired from the plaintiff about the sale of the HUF property. On further inquiry, he revealed to the Captain Rajesh Sethi that there was a talk in the locality regarding the sale of the HUF property by defendant No. 1. The plaintiff immediately questioned defendant No.1 who explained that he wanted to spend his last days in peace and had decided to sell the HUF property to end his daily tension and fights. Plaintiff also got to know that defendant No.1 had already entered into an Agreement to Sell dated 14.01.2004 in favour of defendant No.2 in lieu of which Rs. 39,00,000 was received by him as advance.
8. The plaintiff was shown the Agreement to Sell from which he came to know that defendant No.1 had entered into the Agreement to Sell in his individual capacity even though the suit property belonged to the Col. PC Sethi (HUF). The defendant No.1 neither had the exclusive right to sell the suit property nor was the intended sale for the benefit of the coparceners. Though defendant No.1 assured that he would cancel the transaction and return the advance amount of Rs.39,00,000, he failed to act on his words. Thus, the plaintiff got in touch with defendant No. 2 to appraise him on the HUF status of the suit property which cannot be sold without the concurrence of its joint owners, but this meeting yielded no results.
9. The plaintiff bonafide and verily believed that defendant No.1 who was 82 years old, has been duped and unfair advantage had been taken of his old age. Hence, the present suit has been filed for declaring Agreement to Sell dated 14.01.2004 as null and void and to cancel the said Agreement to Sell.
10. The defendant No.1 Col. P.C. Sethi in his Written Statement admitted that he financed the purchase of the plot and the construction of the house partly from the money received from the claims in respect of ancestral properties left behind in Pakistan, sale of ancestral jewellery & wife’s jewellery and from Provident Fund in order to pay off the loans taken from friends and family. The construction of the house got completed in December, 1955. In May, 1957 the defendant No.1 received second instalment of compensation in the sum of Rs.857/- in respect of his ancestral property left in Pakistan which was used to pay the ground rent, cost of plot and Development charges. In 1962, a sum of Rs.133.18 was received as arrears of payment towards the defendant No.1’s claim for ancestral property left in Pakistan which was also adjusted towards payment of the suit property.
11. It is asserted that the suit property was not initially reflected as a joint family property in the Returns filed by defendant No.1 and the said property was declared as an HUF property only in 1970. During this period, defendant No. 1 was posted outside Delhi and the property was lying vacant. In order to augment the family resources, the suit property was intermittently rented out from time to time. Once he retired from his service on 1st January, 1973, defendant No. 1 permanently shifted to the Ground Floor of the suit property. Thereafter, in the year 1994, the plaintiff took pre-mature retirement and shifted with his family to the suit property and thus, the entire house was occupied only by the family members.
12. Sometime around 1995, defendant No. 3 Shri Raman Sethi also shifted into the suit property after which defendant No.1’s relationship with him and his family, became acrimonious. The situation worsened when defendant No. 3 moved to London on an assignment and left behind his wife and children in the suit property. Eventually, because of the daily fights, the atmosphere in the house became tense which was a common knowledge and well known to the neighbours, acquaintances and relatives.
13. Defendant No.1 through some friends, made acquaintance with one Gurcharan Singh Bawa who introduced him to Sandeep Jain, his property sub-broker. These two gentlemen introduced him to defendant No.2 Shri Ravinder Nangia and convinced defendant No.1 that he could resolve his problems and achieve peace of mind by selling the suit property to buy independent Units and retaining the balance amount for living a peaceful and a comfortable life. He was also assured by the two property brokers that they would find the best possible alternative properties in Defence Colony for him.
14. However, defendant No.1 expressed his inability to sell the suit property as it was the subject matter of an HUF. On the insistence of defendant No. 2, he showed the title documents along with the Income Tax Returns filed in respect of the suit property to him, on 11.01.2004. After going through the documents, Defendant No. 2 conveyed that there was no impediment to the sale of the property as neither any Returns had been filed nor any income had accrued on the suit property since 1994, for which reason the HUF had ceased to exist and expressed his willingness to buy. It is asserted that defendant No. 2 took advantage of the disturbed state of mind of the defendant No.1 and cunningly persuaded and pressurized him with exercise of dominance, to which he succumbed and entered into the Agreement to Sell 14.01.2004.
15. It is explained that on 14.01.2004 the defendant No.1 went to the house of defendant No.2 along with his nephew Major. J.M Sindhwani and signed the Agreement to Sell which was already prepared by defendant No.2 and received an advance money in the sum of Rs.26,00,000 (Rs.10,00,000 by cheque and Rs.16,00,000 by cash) in the presence of the two brokers.
16. It is further explained that when the plaintiff and defendant No. 4 Shri Ravi Sethi, his eldest son confronted him regarding his right to sell the HUF property, he approached defendant No.2 to cancel the transaction, but met with refusal. It is contended that defendant No.1 had truly believed the words of defendant No. 2 Shri Ravinder Nangia that there was no impediment in selling the suit property in his individual capacity. It is also contended that defendant No. 1 did not enter into the Agreement to Sell to fulfil any legal or beneficial necessities of the estate of the HUF or to clear his own personal debts.
17. The defendant No.1 further claimed that the defendant No.2 Sh. Ravinder Nangia had assured him that the HUF ceased to exist as no Income Tax Returns were filed since 1994. No time was given to defendant No. 1 to even read the said Agreement to Sell and within minutes of his arrival, he was made to append his signatures thereon. The Agreement to Sell dated January, 2004 of which specific performance is being sought by defendant no.2 is void, non-est and is unenforceable by reason of undue influence exercised him by, inter-alia, the defendant No.2 to sign the said Agreement.
18. On enquiry in the locality, defendant No. 1 came to know that Shri Ravinder Nangia was part of a powerful consortium of property developers/brokers who controlled nearly 80% of all new developments of properties in the Defence Colony area and wielded considerable clout and influence. When the sons of defendant No. 1 contacted defendant No.2 for cancelling the Agreement, the plaintiff threatened them of dire consequences.
19. It is asserted that due to the continuous pleas of defendant No. 1, Defendant No.2 agreed to cancel the Agreement to Sell but demanded Rs. 1 crore over and above the amounts advanced, as the price for cancellation. Based on the tone and tenor of the language of defendant no.2, the influence held by him and his resistance to cancel the Agreement in an amicable manner, defendant No. 1 sent a letter dated 21.03.2004 terminating the Agreement to Sell and enclosing a copy of the Demand Drafts in the sum of Rs.26,00,000 (Amount received while signing the Agreement) calling upon defendant No.2 to collect the same along with a sum of Rs. 13,00,000 which was later received in cash at any time as per his convenience. It is lastly submitted that he had been made to sign the Agreement to Sell under undue influence and has already terminated/ cancelled before the institution of the present suit, the defendant no.2 is not entitled to a relief of specific performance and his Suit for Specific Performance is liable to be rejected with exemplary costs.
20. The defendant No.2, Shri Ravinder Nangia, the proposed buyer, in his Written Statement has claimed that he agreed to purchase the suit property and the deal was negotiated for a sum of Rs. 2,74,00,000/-(rupees two crores and seventy lakhs) on the assurance by defendant No.1 that he is the lawful owner of the suit property as is also reflected in his individual name in the Lease Deed dated 30.05.1975 issued by L & DO. The property was later converted to freehold vide Conveyance Deed dated 19.02.1997 which also mentioned the individual name of Col. P.C. Sethi. In fact, alleged factum of the suit property being transferred to Col. P.C. Sethi (HUF) was never brought to the notice of the L & DO. It is claimed that no other person or persons had got any right, title, lien or interest of any nature in the suit property except Sh. P.C. Sethi and the same was not subject matter of any HUF and he was thus, entitled to sell the property in accordance with his wishes. The defendant No.2 denied that the suit property is an HUF property or that the defendant No.1 is not its absolute lawful owner. It is further asserted that defendant No.1 is in possession of entire suit property and according to the terms and conditions in the Agreement to Sell, the Sale Deed was to be executed within three and half months i.e. upto 30.04.2004.
21. It is further asserted that even though defendant No.2 was under no obligation to make any further payment before the execution of Sale Deed, a further payment of Rs.13,00,000 was made on 22.01.2004 on the request of defendant No. 1. The balance payment of Rs. 2,48,00,000 was agreed to be paid on or before 30.04.2004 upon the execution of a Sale Deed in favour of the plaintiff.
22. It is asserted that it was not disclosed prior to entering into the Agreement to Sell that the suit property was reflected as an HUF property in the Income Tax Returns. Irrespective, such filings were made only for the limited purpose of avoiding payment of Income Tax. Thus, the present suit has been filed malafidely by colluding with the plaintiff as an afterthought. Moreover, even if the suit property is presumed to be an HUF property, the present suit is not maintainable as a coparcener cannot maintain a suit against the Karta. Moreover, the Karta of an alleged HUF does not require the consent of the coparceners to sell the suit property. It is further asserted that even if it were to be presumed that the suit property belonged to the Col. P.C. Sethi (HUF), Col PC Sethi as the Karta of the said HUF is fully competent to sell the suit property. An alternative submission has also been made stating that the plaintiff is entitled to Specific Performance apropos the share of Col P.C. Sethi in the suit property if the court comes to the conclusion that Col P.C. Sethi is merely the co-owner of the said property and is not entitled to alienate the entire property.
23. It is claimed that due to sudden appreciation in the value of the properties in Delhi, similar properties as suit property saw an increase in value by Rs.75,00,000. Defendant No.1 started getting better offers and thus, turned greedy and dishonest. He wrote a letter dated 21.03.2004 cancelling the Agreement to Sell by stating that he does not intend to sell the suit property, in response to which Defendant No.2 sent a Legal Notice Dated 10.04.2004 requesting Col. P.C Sethi to perform his obligations under the Agreement to Sell dated 14.01.2004.
24. It is further submitted that the suit is liable to be dismissed for misjoinder of all the members of the alleged HUF and the under valuation of the relief at Rs. 39,00,000 (part consideration amount paid to defendant no.1 by defendant no.1)while a Declaration is being sought in respect of Agreement to Sell dated 14.01.2004 the value of which is Rs. 2,74,00,000/-.
25. Shri Ravinder Nangia, defendant No.2 filed CS.(OS) 759/2004 seeking Specific Performance of the Agreement to Sell dated 14.01.2004 asserting that he had always been ready and willing to perform his obligations under the Agreement to Sell. It is further claimed that Col. P.C. Sethi colluded with his sons in order to wriggle out of the obligations under the Agreement to Sell dated 14.01.2004, by alleging the suit property to be an HUF property, despite categorically agreeing in writing at the time of signing the Agreement to Sell that the suit property is not an HUF property. Such a false representation would in fact tantamount to cheating.
26. The defendant No. 3 Sh. Raman Sethi, the youngest son of defendant No.1 has taken a similar defence as the plaintiff claiming that it is an HUF property and defendant No.1 was not competent to execute the Agreement to Sell in his individual capacity. However, the allegations regarding causing tension in the house, were denied and it was stated that defendant No. 1 was in an irritable state due to his age.
27. It is submitted that the Agreement to Sell required compulsory registration under Section 17(1) of the Registration Act, 1908. Because of the mischievous intentions of defendant No.2, he purposely avoided getting the documents registered. It is claimed the Agreement to Sell is, therefore, liable to be set aside.
28. The defendant No.4 Shri Ravi Sethi eldest son of defendant No.2 who is resident of USA, has taken the similar defence as defendant No.3.
29. The plaintiff in his respective Replications to the written statements of the four defendants has re-affirmed his assertions as contained in the plaint.
30. The issues in CS(OS) 436/2004 were framed on 20.03.2006 as under:
“(i) Whether the suit is bad for mis-joinder of necessary parties? OPD-2

(ii) Whether the suit is not properly valued for purposes of Court Fee? OPD-2

(iii) Whether the plaintiff has no locus standi to file the Suit? OPD-2

(iv) Whether the suit property is a HUF property of the Plaintiff, Defendant No.1, Defendant No.3 and others? OPP
(v) Whether Defendant No.1 had the right to or was entitled to execute the Agreement to Sell dated 14.01.2004? OPP

(vi) Whether the Agreement to Sell dated 14.01.2004 was not for legal necessity or for the benefit of the estate of Col. P.C. Sethi (HUF) or for any antecedent debt? OPP

(vii) Whether the Agreement to Sell dated 14.01.2004 is non-est and void ab initio and of no consequence and effect for the reasons stated in the Plaint? OPP

(viii) Whether the Plaintiff is entitled to a decree of permanent injunction restraining the Defendant Nos. 1 and 2 either directly, and/or indirectly, from doing any act in furtherance of and/or under the Agreement to Sell dated 14th January, 2004? OP Parties

(ix) Whether the suit has been filed by the plaintiff in connivance with the defendant No.1 with malafide and as a matter of after though in order to wriggle out of the Agreement dated 14.01.2004 executed by the defendant No.1 in favour of the defendant No.2 in respect of the suit property? OPD2

(x) Whether the defendant No.1, prior to execution of Agreement to Sell dated 14.01.2004, ever disclosed to the defendant No.2 about the ownership of M/s P.C. Sethi HUF in respect of the suit property, if not its effect? OPD1

(xi) Relief.

31. The issues in CS(OS) 759/2004 were framed on 20.03.2006 as under:
(i) Whether the defendant No.1 had executed the Agreement to Sell dated 14.01.2004 under undue influence as alleged in Preliminary Objection No.1 of his Written Statement? OPD 1.

(ii) Whether the defendant No.1, at any point of time, prior to execution of Agreement to Sell dated 14.01.2004, ever disclosed to the plaintiff that the suit property is owned by M/s P.C. Sethi (HUF), if no, its effect? OPD 1.
(iii) Whether the Agreement to Sell dated 14.01.2004 stood validly terminated by defendant No.1 for the reasons given in his letter dated 21.03.2004, if not, its effect? OPD 1.

(iv) Whether the suit property is owned by M/s P.C. Sethi (HUF) as alleged by the defendants in their Written Statement, if so, its effect? OPD.

(v) Whether the plaintiff was ready and willing to perform his part of contract? OPP

(vi) Whether the plea of ownership of M/s P.C. Sethi (HUF) in respect of the suit property has been set up by the defendants out of malafide and as a matter of afterthought in order to wriggle out of the agreement dated 14.01.2004? OPP.

(vii) Whether the defendant No.1 is the Karta of the HUF namely M/s P.C. Sethi (HUF), if yes, its effect? OPD 1

(viii) Whether the plaintiff is entitled to the relief of specific performance in respect of entire property? OPP

(ix) If issue No.8 is decided in negative, whether the plaintiff is entitled to the specific performance of the Agreement in respect of the share of the defendant No.1 in the suit property for the proportionate sale consideration? OPP

(x) If issue No.9 is decided in negative, whether the plaintiff is entitled to a decree for refund of Rs.39,00,000/- and also the recovery of the damages of Rs.75,00,000/- along with interest @ 18% p.a. from the date of Agreement till the date of payment? OPP.

(xi) Relief.

32. The two suits were consolidated for trial vide Order dated 13.12.2006.
33. The plaintiff examined seven witnesses in support of his case.
34. PW1 Capt. Rajesh Sethi, the plaintiff in his affidavit of evidence Ex.PW1/A reiterated his assertions as made in the plaint. The documents relied upon by him are Ex.PW1/1 to Ex.PW1/6.
35. PW2 Ms. Mala Chhabra from the office of L&DO, Nirman Bhawan, New Delhi brought the summoned record pertaining to L&DO which is Ex.PW2/1 to Ex.PW2/20.
36. PW3 Mr. Ajay Kumar UDC from the office of L&DO brought the free hold Conversion Challan dated 09.08.2016 which is Ex.PW3/1.
37. PW4 Mr. Milind Nandurikar, Sr. Branch Manager Standard Chartered Bank produced the record of account bearing No.52505008439 which was in the name of Mr. Rajesh Sethi and his wife Ms. Anjali Sethi. He had written a letter dated 27.03.205 to M/s Armaan Tours & Travels Pvt. Ltd. which is Ex.PW4/1. He further deposed that the account has been closed on 29.04.2011 and is no longer in operation.
38. PW5 Mr. Uday Singh, Tax Assistant, Civil Centre, New Delhi deposed that the summoned record pertaining to Income Tax was not available and the letter dated 17.03.2016 issued by the Income Tax Officer in this regard is Ex.PW5/1.
39. PW6 Shri TS Kakkar, Chartered Accountant who filed the Income Tax returns for the Col. PC Sethi (HUF) has tendered is evidence by way of affidavit Ex.PW6/1. The documents relied upon by him are Ex.PW6/2 to Ex.PW6/6.
40. PW7 Shri Brig Mohan Gulati, s/o Late Shri C.L Gulati has tendered is evidence by way of affidavit Ex.PW7/A to prove the signatures on the valuation report Ex. PW3/1.
41. D1W1 is defendant No.1 Col. P.C. Sethi has tendered his evidence by way of affidavit Ex.D1W1/X.
42. D1W2 Major (Retd.) J.M. Sindhwani has deposed that defendant No.1 Col. P.C. Sethi is his maternal uncle and that after completing his services with Indian Army he came to reside at Faridabad. On 14.01.2014 on the request of defendant No.1, he along with his wife visited defendant No.1 in the suit premises and on his request he drove him to Panchsheel Club, where they met two persons who were introduced as Gurcharan Singh and Ravinder Nangia. They had brought some already typed documents Ex.P1/D2 which were handed over to his uncle who signed the documents without reading them and thereafter they left the Club.
43. D1W3 Shri Manoranjan Chopra has deposed that on the request of defendant No.1, he had conducted the survey to determine the market value of the properties of similar size as the suit property in Defence Colony area. He also asked him to find out about the real estate business of Mr. Ravinder Nangia. He informed defendant No.1 to obtain certified copies of 21 registered Sale Deeds of the properties in Defence Colony during the period 2010 to February, 2016. The average sale price of similarly located plots was approximately Rs.22.07 crores. He handed over the certified copies of the registered Sale Deeds to defendant No.1 which are exhibited as Ex.D1-W1/L1 to Ex.D1-W1/L21. Furthermore, on the request of defendant No.1 he obtained certified copies of the documents pertaining to Maanick Enterprises Pvt. Ltd. and Swati Real Estate Pvt. Ltd. which are Ex.D1-W1/H1 to Ex.D1-W1/H14.
44. Defendant No.3 Shri Raman Sethi in his testimony as DW3 tendered his evidence by way of affidavit Ex.D3-W1/A.
45. Shri Ravinder Nangia has also deposed as PW1 being the plaintiff in CS (OS) 759 of 2004 and has tendered is evidence by way of affidavit Ex.PW1/A.
46. The detailed testimony of the witnesses shall be considered subsequently.
47. Captain Rajesh Sethi has submitted his written submissions in CS(OS) 436/2004. It has been has argued by his learned counsel that the suit property was an HUF property purchased by defendant No.1 from the funds received in lieu of the ancestral property in Pakistan and the compensation amount. The defendant No.2 has wrongly contended that the Conveyance Deed was in the individual name of defendant No.1 and thus, the suit property cannot belong to the HUF. Section 4(3) of the Benami Transactions (Prohibition) Act, 1988 as it previously stood and Section 2(9) of the Amended Benami Act makes an exception in respect of the properties that are purchased for HUF; the suit property belonged to HUF, even though it was registered in the individual name of Col. P. C. Sethi. For this reliance has been placed on Anis Ur Rehman vs. Mohd. Tahir, RFA NO.855 of 2018 decided on 21.01.2019 and Paramjit Anand vs. Mohan Lal Anand, 2018 (170) DRJ 670.
48. It is further argued that considering the HUF character of the suit property, Col. PC Sethi was not competent to enter into an Agreement to Sell in his individual capacity. Reliance has been placed on Commissioner of Wealth Tax Kanpur & Ors. vs. Chander Sen & Ors. (1986) 3 SCC 567, Yudhishthir vs. Ashok Kumar (1987) 1 SCC 204, Sunny (Minor) and Anr. Vs. Raj Singh and Anr. 225 (2015) DLT 211 and Surender Kumar vs. Dhani Ram & Ors. 227 (2016) DLT 2017.
49. In the present case, the plaintiff was born in 1951, Ravi Sethi in 1947 and Raman Sethi in 1955 i.e. all were born before 1956. Before 1956, an HUF was automatically created if an immovable property was inherited from paternal ancestors for upto three generations. Since the suit property was purchased from the claims received for their ancestral property, the same constituted an HUF property.
50. The change came only with Hindu Succession Act, 1956 after which automatic creation of an HUF ceased as a legal concept. Notwithstanding the above, an HUF could come into existence even after 1956 by putting property in a common hotchpotch for which reference has been made to Sunny (Minor) and Anr. (supra) and Surender Kumar (supra). In the alternative, it is argued that even the subsequent acts of defendant No.1 of filing Income Tax Returns and execution of Lease Deeds clearly establish that the suit property was an HUF property. It is, therefore, submitted that the Agreement to Sell dated 14.01.2004 entered into between defendant No.1 and 2, is liable to be declared null and void.
51. Learned counsel for defendant Nos. 3 & 4 Shri Raman Sethi & Ravi Sethi respectively have argued and also submitted the written submissions stating that there is no dispute that after partition, Col. P.C. Sethi defendant No.1 came to India and submitted his claim for the properties that were left in Pakistan and he got the compensation which was utilized for the purchase of the suit property. Therefore, the property so purchased is ancestral property as has been held in Maya Ram and Others vs. Satnam Singh AIR 1967 P&H 353 and Neelam Kapoor vs. Bagh Chand RFA Nos. 241/1999 & 242/1999 decided on 14.03.2011. It is argued that these facts are also corroborated from the testimony of Col. P.C. Sethi. It is further argued that the detailed evidence which has been led by the plaintiff, defendant No.1 and defendant No.3 clearly proves the HUF status of the suit property and defendant No.1 had no authority to enter into the Agreement to Sell. Defendant No.3 Shri Raman Sethi being a co-parcener had contributed for the upkeep of the suit property and the Agreement to Sell is liable to be declared as null and void.
52. Raman Sethi has submitted in his written submissions in CS (OS) 436/2004 that the ancestral properties in Pakistan were in the name of grandfather Sh. Beli Ram Sethi who is the father of Col. P.C. Sethi. The same has been recorded in jamabandi, though has not been produced by the parties. The claim amount was used to purchase the suit property and thus, an HUF was automatically created. The submission of Captain Rajesh Sethi have further been reiterated.
53. Shri Ravinder Nangia has submitted in his written submissions in CS(OS) 759/2004 that the defendants have failed to establish or even mention when the HUF was created. Reliance is placed on Dayanand Rajan & Ors. vs Ram Lai Khattar, AIR 2018 Delhi l04 to contend that it is a mandate under Order VI Rule 4 CPC to disclose the cause of action and in this case, the date of creation of the HUF. Though Col. P.C. Sethi claims in his cross examination that the HUF was created in 1947 when his first son was born, there is no document produced to this effect. In fact, none of documents relating to the suit property after 1947 record the HUF status of the suit property.
54. Submissions heard from the Ld. Counsels for all the parties and the evidence and record perused. .

In CS(OS) 436/2004:
Issue No.1: Whether the suit is bad for mis-joinder of necessary parties? OPD-2
55. A preliminary objection has been taken by defendant No.2 Ravinder Nagia that all the members of the alleged HUF of the Defendant No.1 Col. P.C. Sethi, who are necessary parties to the suit, have not been impleaded. Admittedly, defendant No.1 Col. P.C. Sethi had three sons i.e. the plaintiff Caption Rajesh Sethi, defendant No.3 Shri Raman Sethi and defendant No.4 Shri Ravi Sethi. Originally, when the suit for Declaration was filed by Captain Rajesh Sethi, son of defendant No.1 Col. P.C. Sethi, his two brothers Shri Raman Sethi and Shri Ravi Sethi had not been impleaded as a party. Subsequebtly, Shri Raman Sethi was impleaded as defendant No. 3 vide order 09.08.2004, Shri Ravi Sethi was impleaded as defendant no. 4 vide Order dated 22.05.2006. Thus all the members of the HUF, who are necessary parties have been impleaded in the suit.
This issue is decided against Shri Ravinder Nangia.

In CS(OS) 436/2004:
Issue No.2: Whether the suit is not properly valued for purposes of Court Fee? OPD-2.
56. Defendant No.2 had taken a preliminary objection in his Written Statement that the suit had been valued at Rs.39,00,000 i.e. the amount that was paid by defendant No.2 to defendant No.1 pursuant to an Agreement to Sell, when in fact the declaration is being sought in respect of Agreement to Sell dated 14.01.2004 the value of which is Rs.2,74,00,000. It is thus contended that the suit ought to have been valued at Rs.2,74,00,000 and thus, the suit has been undervalued.
57. The valuation of the suit has been provided in paragraph 20 of the Plaint as thus:
“20. For the purpose of pecuniary jurisdiction and valuation the present Suit is valued at Rs 39,00,000/- (being the monies paid/received under the Agreement to Sell dated 14th January, 2004) and advalorem Court Fee of Rs 40,00,00/- has been paid. For the relief of Declaration the Suit is valued at Rs.200/- and Court fee of Rs. 20/- has been affixed. For the relief of Mandatory Injunction the Suit is valued at Rs. 200/- and Court fee of Rs. 20/- has been affixed. For the relief of Permanent Injunction the Suit is valued at Rs. 260/- and Court fee of Rs. 26/- has been affixed.”

58. In the present case the plaintiff has sought for a Declaration that the Agreement to Sell dated 14.01.2004 is void ab initio and non-est and a Mandatory Injunction to direct the defendant No.1 to cancel the said Agreement. Though couched as a Mandatory Injunction, the plaintiff in effect, has sought cancellation of Agreement to Sell. According to Section 7(iv) (c) of the Court fees Act, 1871, suit where a decree for Declaration and Consequential relief is prayed, court fee is payable “according to the amount at which the relief sought is valued in the plaint or memorandum of appeal”.
59. Section 8 of the Suit Valuation Act, 1877 provides that in any of the suits referred to in clause (iv) of Section 7 of the Court Fees Act, 1870, court fee is payable ad valorem on the value determined for the purpose of the jurisdiction. It is apparent that the relief for declaring the Agreement to Sell as void and non-est has to be valued at the sale consideration agreed to in the Agreement i.e. Rs. 2,75,00,000 and not the sum of Rs. 39,00,000 which is an installment or part payment of the said consideration. Thus, the court fee payable must be determined on the valuation of Rs. 2,75,00,000. An ad valorem court fee of Rs. 40,500 has been paid as the plaintiff has valued the relief at Rs. 39,00,000, which is insufficient. Therefore, the plaintiff Captain Rajesh Sethi is liable to pay the deficient court on a valuation of Rs. 2,74,00,000.
This issue is decided accordingly.

In CS(OS) 436/2004:
Issue No.3: Whether the plaintiff has no locus standi to file the Suit? OPD-2
Issue No. 8: Whether the Plaintiff is entitled to a decree of permanent injunction restraining the defendant Nos 1 and 2 either directly, and/or under the Agreement to Sell dated 14th January, 2004? OP Parties
60. Defendant No.2, Shri Ravinder Nangia has challenged the locus standi of the plaintiff, who claims to be a coparcener of the Col. PC Sethi HUF, to file a suit against the Karta of the alleged HUF as a coparcener can never file a suit against their Karta.
61. In the present case, the plaintiff has sought a Declaration that the Agreement to Sell dated 14.01.2004 is non-est and an Injunction for restraining the defendants from executing the said Agreement to Sell. Section 38 of the Specific Relief Act, 1963 (hereinafter referred to as Act, 1963) provides for the circumstances under which permanent injunction can be granted by a Civil Court. Section 41(h) of the said Act,1963 bars the grant of an injunction in cases where an alternate efficacious remedy is available.
62. In the case of Sunil Kumar and Another v. Ram Parkash and Others, (1988) 2 SCC 77 the Apex Court considered the similar facts wherein the Karta entered into an Agreement to Sell the coparcenery property to third party claiming it to be his individual property. The plaintiff claimed the suit property as ancestral property and they as coparceners of joint Hindu Mitakshara family having equal shares with their father in the suit property. It was held that “…No doubt the law confers a right on the coparcener to challenge the alienation made by karta, but that right is not inclusive of the right to obstruct alienation. Nor the right to obstruct alienation could be considered as incidental to the right to challenge the alienation. These are two distinct rights. One is the right to claim a share in the joint family estate free from unnecessary and unwanted encumbrance. The other is a right to interfere with the act of management of the joint family affairs. The coparcener cannot claim the latter right and indeed, he is not entitled for it. Therefore, he cannot move the court to grant relief by injunction restraining the karta from alienating the coparcenary property.”
63. It is thus, explained that a coparcener has no right to interfere in the management of the joint family affairs and seek injunction to restrain the Karta from alienating the property. If any such alienation is objectionable then, it may be challenged after the sale is completed on the ground that it was not undertaken for benefit of estate or for legal necessity. The other remedy with the coparcener, if he apprehends mismanagement of the HUF property, is to seek partition. However, no simpliciter preventive Injunction can be sought.
64. In Sunil Kumar and Another (supra) it was however clarified that “that in case of waste or ouster an injunction may be granted against the Manager of the joint Hindu family at the instance of the coparcener. But nonetheless a blanket injunction restraining permanently from alienating the property of the joint Hindu family even in the case of legal necessity, cannot be granted”. The question whether the suit property is the self-acquired property of the father or it is the ancestral property has to be decided before granting any relief. The suit being one for permanent injunction, this question cannot be gone into and decided. Moreover, the case of specific performance of agreement of sale had already been decreed by then.
65. In the judgement of Sri Narayan Bal and Others vs. Sridhar Sutar and Others, 2 (1996) 8 SCC 54 it was observed by the Apex Court that though a coparcener has the right to claim his share in the HUF property, he cannot file a suit for injunction to restrain the Karta from alienating the property as the right to challenge accrues only after the alienation has been completed.
66. In the present case, the suit property, which is alleged to the subject matter of the Col. PC Sethi (HUF), has not been completely alienated by the Karta but only an Agreement to Sell dated 14.01.2004 Ex. P1/D2 has been executed by defendant no.1 claiming it to be his individual property. Thus, the plaintiff Captain Rajesh Sethi is seeking to avoid the Agreement to Sell on account of the suit property being an HUF property and the consequential relief of injunction to restrain the Col. PC Sethi from alienating the property. Since the relief claimed requires extensive to determine whether the property indeed belongs to an HUF, the plaintiff Captain Rajesh Sethi has a locus to maintain the suit for Declaration and Mandatory Injunction which pertains to the cancellation of the Agreement to Sell in respect of the suit property.
67. However, the suit property being an HUF property, Captain Rajesh Sethi is not entitled to permanent injunction to restrain Col. P.C. Sethi from managing the Suit property, which includes the right of alienation.
These issues are decided accordingly.

In CS(OS) 436/2004:
Issue No. 4: Whether the suit property is a HUF property of the Plaintiff, Defendant No.1, Defendant No.3 and others? OPP
In CS(OS) 759/2004:
Issue No. 4: Whether the suit property is owned by M/s P.C Sethi (HUF) as alleged by the by the defendants in their written statement? OPD
68. Admittedly, Col. P.C. Sethi had entered into an Agreement to Sell dated 14.01.2004 Ex. P1/D2 with Shri Ravinder Nangia. The said Agreement to Sell has been challenged by the Captain Rajesh Sethi on the ground that the suit property was an HUF property and Col. P.C. Sethi could not have agreed to sell the same by representing himself to be its absolute /individual owner.
69. In Surender Kumar Khurana vs. Tilak Raj Khurana, (2016) 155 DRJ 71 (DB) it was explained that it would not be enough to say in the plaint simply that a Joint Family or HUF existed. Detailed facts as required by Order VI Rule 4 of the CPC as to when and how the HUF properties had become so must be clearly and categorically averred. Such averments have to be made by factual reference qua each property claimed to be an HUF property as to how the same came to be an HUF property. In law, generally bringing in any and every property as HUF is incorrect as there is known tendency of litigants to include unnecessarily many properties claiming them to be an HUF.
70. To appreciate the contention of the plaintiff Capt. Rajesh Sethi, it would be relevant to briefly reiterate that a Joint Hindu Family consists of all persons lineally descended from a common ancestor, and includes their wives and unmarried daughters as explained in the Commissioner of Income Tax vs Luxminarayan, (1935) 59 Bom 618. Thus, under the traditional Hindu Law a daughter becomes the member of her husband’s family upon marriage and she thus ceases be a member of her father’s family.
71. In Raghavachariar’s, Hindu law, 5TH Edition at p. 838, the concept ‘coparcenary’ was defined as under:
“Co-parcenary is a narrower over body than a joint family and consist of only those persons who have taken by birth and interest in the property of the holder for the time being and who can enforce a partition whenever they like. It commences with the common ancestor and includes the holder of joint property and only those males in his male line who are not removed from him by more than three degrees.”
72. This aforesaid explanation provides the meaning of a “coparcener” under the customary Hindu law. Thus, a “Joint Hindu Family” consists of male members descended lineally from a common male ancestor and including their unmarried daughters, wives, mothers and widows. On the other hand, a coparcenary is a narrower body which is a subset within a Joint Hindu Family where an interest in the property is created by birth. Though a joint family status is a result of birth, the possession of joint property is only an appendage and not prerequisite for the constitution of such a family as held in Haridas vs Devaki Bai, 1926 SCC OnLine Bom 76. Thus, a “coparcenary” is created only when there is joint or coparcenary property.
73. Before the enactment of Hindu Succession Act, 1956 the HUF in a joint family would automatically come into existence as soon as there was an acquisition of property by the joint Family. An HUF could also be created by putting the individual property in the HUF pool. The HUF once constituted, would continue even after the enactment of the Hindu Succession Act,1956 (hereinafter referred to as HSA,1956) if not dissolved. Even after the enactment of HSA, 1956 the HUF already in existence would continue till dissolved expressly by partition.
74. Prior to the passing of the Hindu Succession Act, 1956 there was a presumption as to the existence of an HUF and its properties and as such the properties were inheritable upto three generations. In the pre 1956 era when the customary Hindu law was prevalent, the coparcenary with HUF properties which came into existence prior to passing of the Hindu Succession Act, 1956 continued so even after the passing of Hindu Succession Act, 1956. Thus, when a property is inherited by the members of an HUF even after 1956, it would be jointly held by their paternal successors up to three degrees. In such a case, the status of Joint Hindu Family/ HUF properties continues even after 1956 till it is dissolved by the parties or by virtue of law.
75. It is concomitant to examine the testimonies in light of the requisite procedure to create an HUF. D1W1 Col. P.C. Sethi in his affidavit of evidence Ex.D1W1/X has explained that he was the only son of his parents and belonged to Sethi Mohalla, Kot Jai Village, Tehsil Dera Ismail Khan, District Dera Ismail Khan, North-West Frontier Province, India (now situated in Pakistan). His father had inherited two properties namely, ‘Kutcha Pucca house inside Sethi Mohalla, Village Kot Jai constructed on an area ad-measuring 420 sq. Yards’ and ‘One shop inside Kot Jai Bazar, consisting of one room’. On completion of his education, he was commissioned as an Officer of the Indian Army on 15.10.1944. After being commissioned, he was posted in different areas as per the orders of the Competent Authority.
76. At the time of partition he was posted in School of Artillery, Coast Wing, Colaba, Bombay. As there was huge rioting and arsenal violence during this period, his mother Late Jeevani Devi and his wife Late Sarla Devi who were residing in their ancestral home at Kot Jai, Dera Insmail Khan at the time of partition, came to India with the assistance of Indian Army. After the partition and creation of independent India, he opted to join the Indian Army and thereafter, never visited his ancestral village at Kot Jai.
77. D1W1 Col. P.C. Sethi has further deposed in his affidavit that after moving to India during the partition, the suit property was purchased and constructed based on the claim amount received for their ancestral property in Pakistan and loans that were repaid through ancestral jewelry and wife’s jewelry. Hence, he held the suit property under his name in a fiduciary capacity as a Karta.
78. He submitted his Claims Ex.P1 and P2 for the immovable property left by the family in Pakistan, before the Claims Officer who conducted an inquiry and verified the claims on 04.02.1952 vide Ex. P3; the certified copy of the letters by Under Secretary, Ministry of Home Affairs, Government of India are Ex.D1W1/A and D1W1/B. The Claim Officer, in Ex.D1W1/C, valued both the properties for a total of Rs.3800/- i.e. Rs.2,500/- for the house and Rs.1,300/- for the shop.
79. He filed an application with the Resettlement Commissioner, Ministry of Defence and suit property bearing No.C-269, Kilokari, New Delhi was allotted to him and his family initially on Perpetual Lease vide letter dated 07.11.1952. The Certificates of Eligibility dated 06.03.1953 and 11.05.1954 Ex.PW2/5 and Ex.PW2/19 were issued in his favour. He was handed over possession of the suit property vide Certificate of Possession dated 13.05.1954 Ex.PW2/17. The purchase of the plot and construction of residential house thereon was done partly from the money received from the Claims and partly from the sale of ancestral jewellery and sale of wife’s jewellery to pay off the loans taken from his Provident Fund, friends and family.
80. The Perpetual Lease Deed Ex.PW2/2 was executed in his favour by President of India on 26.11.1955 for 99 years which was duly registered. He deposed that though the Perpetual Lease Deed was executed in his individual name, it was acquired and constructed from the ancestral funds and he held the property in a fiduciary capacity as the Karta of HUF.
81. D1W1 Col. P.C. Sethi has further explained that he was posted at various places, hence the suit property was given out on rent. He got posted in Delhi from March 1971 till 01.01.1973 and during this period he got the first floor of the suit property constructed in the year 1972. He along with his family, was residing on the ground floor of the suit property and they all had a common kitchen. After the construction of first floor, the same was rented out to different persons from time to time and the common kitchen of the family members continued till 1994.
82. He has further explained that because of accrual of rental income from the suit property, he was advised to register it as an HUF with the appropriate Income Tax Authority. At that time, his eldest son Ravi Sethi, defendant no.4 was in USA. He informed everyone that he was creating an HUF and wrote two letters viz. dated 29.12.1977 Ex.D1W1/E and another letter though not available with him, informing his son Ravi Sethi about it.
83. D1W1 Col. P.C. Sethi proved his Income Tax Returns and the Assessment Challans on behalf of HUF, as Ex.D1W1/F1 to F10. The Assessment Returns for the year 1989-90 Ex.D1W1/F2 reflect that the only income in the HUF was the income from the suit property as it was the only asset of the HUF.
84. He has further deposed that his second son Captain Rajesh Sethi/plaintiff took a voluntary retirement from the Indian Navy in the year 1994 and he came to stay on the ground floor of the suit property initially and thereafter occupied the first floor. Since 1994 there was no further income from the HUF property and consequently, no Income Tax Returns in the name of HUF were filed thereafter.
85. D1W1 Col. P.C. Sethi has further explained that initially his youngest son Raman Sethi (defendant No.3) was working in various Companies outside Delhi. He relocated himself in Delhi in 1995 and started residing with them on the ground floor of the suit property. Because of shortage of space, second floor was constructed in the year 1996. By then, he also retired and had no further resources to undertake the construction of the second floor which was done jointly by his sons.
86. In the interim, a scheme was launched by Government of India for conversion of Lease hold property into Freehold property. His sons were also desirable of getting the property converted to freehold. Captain Rajesh Sethi, the plaintiff thus, undertook all the expenses and the challan for the payment of the conversion fee is Ex.PW3/1and the Conveyance Deed dated 19.02.1997 Exhibit PW-3/DX2 was thereafter executed.
87. D1W1 Col.P.C.Sethi has deposed that the HUF was automatically created on the birth of his first son Shri Ravi Sethi who was born on 13.10.1947 and the HUF has not never been dissolved thereafter. It is admitted by D1W1 P.C.Sethi in his cross-examination that though this property was allotted at his individual name but it was in the capacity of being the Karta of HUF. He has further explained that though he had not used the expression of Karta of HUF in his claim made to Government of India, but according to the traditional Hindu Law, the HUF was born on 13.10.1947.
88. It is further explained by him that he did not have complete knowledge about the concept of HUF at that point of time. For some time they income was added to his personal income and at that stage, the rental income was not substantial and did not attract income tax. He had only subsequently registered the HUF with the Income Tax Authorities in or around 1970 when the suit property started fetching rent which was taxable.
89. It is further established that in none of the documents of claim or allotment, Col. PC Sethi had been reflected as Karta of the HUF and all the documents, namely, the Perpetual Lease Deed and Conveyance Deed were all executed in his individual name. Nevertheless, the existence of an HUF which is a creation of law, cannot be disputed in the light of overwhelming evidence on record which has proved that the claim amounts received in lieu of the properties left in Pakistan, were adjusted towards the purchase of the suit property.
90. Similar is the testimony of the PW1 Captain Rajesh Sethi, plaintiff in his affidavit in Ex.PW1/A that the suit property had been acquired from ancestral funds. He corroborated the testimony of his father that the conversion charges in the sum of Rs.52,200/- for the suit property, were paid by him vide cheque No.121922 dated 03.08.1996 drawn on ANZ Grindlays Bank, New Delhi, which had his signatures and is Ex.PW1/5. He also deposed that the suit property belongs to the Col. P.C. Sethi (HUF).
91. D3W1 Shri Raman Sethi in Ex D3W1/A has also deposed that Col. PC Sethi is not the sole owner of the suit property as it belongs to an HUF. It is stated that the certified copies of the Schedule of fixtures in the suit property in Ex. D3W1/8 and the Valuation Report dated 19.07.1982 were procured from the MCD records through RTI, which record Col. PC Sethi as the Karta of the HUF.
92. The testimony of the PW1 Shri Rajesh Sethi, plaintiff as well as the testimony of the D1W1 Col. P.C.Sethi and D3W1 Shri Raman Sethi, which is fully corroborated by the documents as discussed above, proves that the family of Col. P.C. Sethi was residing in Village Kot Jai, District Dera Ismail Khan, North West Frontier Province, Pakistan which was part of undivided India and became part of Pakistan on partition. Thereafter, the family of Col. P.C.Sethi shifted from Pakistan to India and in lieu of the properties left behind in Pakistan they were given claim/compensation and the property in question was also allotted to them. A Lease Deed dated 26.11.1955 Ex PW2/2 and subsequently a Conveyance Deed dated 19.02.1997 Ex PW3/DX2 was registered in the name of Col PC Sethi.
93. This court in the case of Neelam Kapoor vs. Bagh Chand (supra) and Maya Ram and others vs. Satnam Singh (supra) held that the land allotted to a displaced person in India in lieu of the land left in Pakistan which was ancestral, will be deemed to be ancestral qua his sons.
94. It is hence, proved that the allotment of the suit property was in lieu of the ancestral properties left in Pakistan and was an HUF property.
95. The HUF was admittedly never dissolved and continued even after the enactment of the Hindu Succession Act,1956. This is countenanced by the fact that the suit property was registered with the Income Tax Authority in the year 1970 ‘on account of rental income accruing from the suit property resulting in higher tax liabilities for him’. The Income Tax Returns were filed by Col. P.C. Sethi in the capacity of Karta of the HUF; some of the Income Tax Challans for the Assessment years 1992-1993, 1993-1994 are Ex D1-W1/F7 and D1-W1/F10. The filling of these Returns have also been proved by PW6 T.S. Kakkar who was appointed as the Chartered Accountant for the HUF in the year 1975.
96. It is observed that registration with Income Tax Authority is only an incident of evidence to prove its existence and not the process of creation of HUF itself. As already discussed above, HUF came into existence way back in 1947. It is natural that HUF would be registered with Income Tax Authority only when it starts generated taxable income and every individual “is entitled so to arrange his affairs as not to attract taxes imposed by the Crown so far as he can do so within the law, and that he may legitimately claim the advantage of any expressed term or of any emotions that he can find in his favour in taxing Acts. In so doing he neither comes under liability nor incurs blame” as held by Lord Sumner in IRC vs Fisher’s Executors, 1926 AC 395. Similar view was taken by the Supreme Court in the case of CIT vs A. Roman & Company, AIR 1968 SC 49.
97. Moreover, after the registration of the HUF, Col. PC Sethi has entered into Lease Agreements dated 01.04.1991 and 16.11.1991 with M/s Ranbaxy Laboratories and Tube Investments of India Ltd in Ex P18 and Ex P20 respectively under the capacity of Karta of the Col. PC Sethi (HUF).
98. It is thus, established from the evidence of D1W1 Col. P.C.Sethi that the suit property belongs to Col. PC Sethi (HUF) of which he was the Karta. An HUF continues to exist until and unless it is dissolved by the Karta which may happen by way of a partition as observed in Income Tax Officer, Calicut vs N.K. Sarada Thampatty (Smt), 1991 Supp (2) SCC 737. Admittedly, neither a partition has taken place nor has the HUF been dissolved.
99. Therefore, it is held that the Suit Property is the HUF property of M/s. P.C. Sethi (HUF).
Issues are answered accordingly.

In CS(OS) 759 / 2004
Issue No. 7: Whether the defendant no.1 is the Karta of the HUF namely M/s P.C. Sethi (HUF), if yes, its effect? OPD1
Issue No. 8: Whether the plaintiff is entitled to the relief of specific performance in respect of the entire property? OPP
100. In the light of the findings in the above mentioned issues that the suit property was an HUF property, Defendant no.1. Col. P.C. Sethi being the eldest member of the Coparcenary, became its Karta.
101. Having so held, the next aspect for consideration is what are the powers and obligations of the Karta towards the HUF. In a Hindu family, the Karta or manager occupies a unique position. The legal position of Karta or manager has been succinctly summarized in the Mayne’s Hindu Law (12th Ed. para 318) thus:
“318. Manager’s Legal position-“The position of a karta or manager is sui generis; the relation between him and the other members of the family is not that of principal and agent, or of partners. It is more like that of a trustee and cestui que trust. But the fiduciary relationship does not involve all the duties which are imposed upon trustees.”
102. The managing member or Karta has not only the power to manage, but also power to alienate the joint family property which is circumscribed by three caveats, namely: for family necessity, discharge of family obligations or for the benefit of the estate. Such alienation would bind the interests of all the undivided members of the family whether they are adults or minors.
103. The oft quoted decision on this aspect wherein the position of the Karta is considered akin to that of a guardian of a minor, is that of the Privy Council in Hanooman Parshad v. Mt. Babooee, 1856 SCC OnLine PC. There it was observed at p. 423:
“The power of the manager for an infant heir to charge an estate not his own is, under the Hindu law, a limited and qualified power. It can only be exercised rightly in case of need, or for the benefit of the estate.”
104. In the case of Beereddy Dasaratharami Reddy v. V. Manjunath and Others, Civil Appeal No. 7037/2021 decided on 13.12.2021, the Supreme Court has explained that the right of the Karta to execute the Agreement to Sell or Sale Deed of a Joint Hindu Family property for the fulfilling legal necessities such as payment of government revenues, maintenance of coparceners, conducting marriage and religious functions, payment of debts, acting for the benefit of the estate etc. is settled and is beyond cavil based on the several judgments of this Court.
105. As discussed above, the HUF property can be sold by the Karta only in three situations namely, (i) benefit of his estate; (ii) legal necessity; and (iii) indispensable religious obligations. In the present case, neither of the three grounds has been pleaded nor proved on behalf of the defendant No. 1/Col. P.C. Sethi. The entire suit property could not have been sold by Col. P.C. Sethi in an individual capacity. Therefore, this court is of the view that Shri. Ravinder Nangia is not entitled to the relief of specific performance in respect of the entire suit property.
The issues are accordingly decided.

In CS(OS) 436 / 2004
Issue No.5: Whether Defendant No. 1 had the right to or was entitled to execute the Agreement to Sell dated 14.01.2004? OPP
Issue no 6: Whether the Agreement to Sell dated 14.01.2004 was not for legal necessity or for the benefit of the estate of Col. P.C. Sethi (HUF) or for an antecendent debt? OPP
Issue No. 7: Whether the Agreement to Sell dated 14.01.2004 is non-est and void ab initio and of no consequence and effect for the reasons stated in the Plaint? OPP

In CS(OS) 759 / 2004
Issue No.9: If issue No. 8 is decided in negative, whether the plaintiff is entitled to the specific performance of the Agreement in respect of the share of the defendant No.1 in the suit property for proportionate sale consideration? OPP

106. Now the question before this Court for its consideration is whether Col. P.C. Sethi could have entered into the Agreement to Sell dated 14.01.2004 for the sale of the suit property in his individual capacity and not as the Karta of the Col. P.C. Sethi (HUF), as it was an HUF property. The attendant issue is not whether a Karta is entitled to alienate an HUF property without the consent of the coparceners but whether a Karta can alienate an HUF property as his individual property.
107. Though the powers of alienation held by a Karta is indubitable and the coparceners have no right to challenge such alienation until completely effectuated. As has been stated above, the onus of proving that the sale transaction was for the legal necessity or for the benefit of the estate or pious duty, rests on the purchaser of the property. The proposed purchaser Ravinder Nangia has neither alleged nor led any evidence to prove that Col. P.C. Sethi had undertaken the Sale transaction for any of these reasons. However, this discussion is more academic as Col. P.C. Sethi had represented the suit property to be his individual property in the Agreement to Sell. So be the case, there was no occasion for the defendant no.2 Ravinder Nangia to make such enquiry.
108. Given that Col. P.C. Sethi has signed the said Agreement in favour of Shri. Ravinder Nangia as the absolute owner of the suit property and there is no evidence whatsoever that it was undertaken for the reasons as permitted for alienation of HUF property by the Karta, the next question is whether Col. P.C. Sethi is bound by the Agreement to the extent of his undivided share in the suit property.
109. To determine whether the aforesaid, legal consequence of the Agreement to Sell ought to be considered. In Raj Kumar Raghubanchmani Prasad vs Ambica Prasad Singh, AIR 1971 SC 776, it was observed that  in any event an alienation by the Manager of the joint Hindu family even without legal necessity is voidable and not void.
110. Thus, the Agreement to Sell in the present case by its very nature is not void ab initio.
111. Further, the Madras High Court in Vasanthlal and ors vs Ramu and ors, MANU/TN/5425/2022 found that if a sale executed by a Karta is found to be voidable for not satisfying the essential condition of legal necessity, then alienating Karta would only be bound to the extent of their own undivided share.
112. The Apex Court in Smt. Sarla Agarwal vs Sh. Ashwani Kumar Agarwal, 2012 SCC OnLine Del 5408 has categorically held that a coparcener can sell his undivided share in the HUF property without seeking the consent of the coparceners. However, the intending purchaser does not acquire the title to a defined share without first seeking partition of the said property as the share of the purchaser also remain undefined as held in the case of Sidheshwar Mukherjee vs Bhubeshwar Prasad Narain Singh, AIR 1953 SC 487.
113. The aforesaid findings are in line with Section 44 of the Transfer of Property Act, 1882 which reads as under:
“Transfer by one co-owner.—Where one of two or more co-owners of immoveable property legally competent in that behalf transfers his share of such property or any interest therein, the transferee acquires as to such share or interest, and so far as is necessary to give effect to the transfer, the transferor’s right to joint possession or other common or part enjoyment of the property, and to enforce a partition of the same, but subject to the conditions and liabilities affecting, at the date of the transfer, the share or interest so transferred.
Where the transferee of a share of a dwelling-house belonging to an undivided family is not a member of the family, nothing in this section shall be deemed to entitle him to joint possession or other common or part enjoyment of the house.”
114. Section 44 of the Transfer of Property Act, 1882 also recognizes the right of the coparcener to sell the undivided share to the third party without the consent of other co-owners and the transferee acquires the rights and interest in the property which he can exercise by way of partition. To protect the members of a coparcenary from the intrusion or interference of a third party purchaser when a coparcener alienates his undivided share in a residential home, the transferee is not entitled to joint possession but would have to claim partition. Thus, the right of the coparcener to sell the undivided share is also acknowledged statutorily.
115. Although the power of disposition of joint family property has been conceded to the manager of joint Hindu family for the reasons aforesaid, the law raises no presumption as to the validity of his transactions. His acts could be questioned by the other members of the joint family to have the transaction declared void, if not justified. When an alienation is challenged as being unjustified or illegal it would be for the alienee to prove that he did all that was reasonable to satisfy himself there was Legal necessity in fact or that he made proper and bonafide enquiry as to the existence of such-necessity. If the alienation is found to be unjustified, then it would be declared void. Such alienations would be void except to the extent of manager’s share; the purchaser could get only the manager’s share. [Mayne’s Hindu Law 11th ed. para 396].
116. This court thus, concludes that in such circumstances where the Karta alienates the HUF property outside the scope of legal necessity, such a sale cannot be held valid in respect of entire HUF property as he cannot transfer a share more than what he has as encapsulated in the Maxim Nemo dat quod non habet.