Hindu Law-Avyavaharika debt-Burden of proof.
The plaintiff-respondent filed a suit demanding that certain jewellery which- she had entrusted to her deceased brother- appellant's father-for safe custody be returned to her. The appellant replied that his father during his life-time had returned the jewellery to the plaintiff. The trial Court dismissed the suit, but on appeal the High Court decreed the suit. In appeal to this Court, the appellant contended, that (i) the suit was not maintainable, because the jwellery was left with his father with the object of defrauding a third party, who had filed a suit claiming share in the ornaments; and (ii) the appellant was not liable 'to pay out of joint family property the debt of his father which was avyavaharika or, illegal.
Held: The appeal must be dismissed
(i) The principle that the Courts will refuse to enforce an illegal agreement at the instance of a person who is himself a party to an illegality or fraud is expressed in the maxim in pari delicto, portior est conditio defendentis. But there are exceptional cases in which a man will be relieved of the cvonsequences of An illegal contract into which he has entered. To those cases the maxim does not apply. They fall into three classes (a) where the illegal purpose has not yet been substantially carried into effect before it is sought to recover money paid or goods delivered in furtherance. of it (b) where the plaintiff is, not in pari delicto with the defendant, (c) where the plaintiff does not have to rely on the illegality to make out his claim. [811 F-G].
It is settled law that where the parties are not in pari delicto, the less guilty party may be, able,to recover money paid, or property transferred, under an unlawful contract. This possibility may arise in three situations. First,, the contract may be of a kind made illegal by statute in the interests of' a particular class of persons of whom the plaintiff is one. Secondly, the plaintiff may havebeen induced to enter into the contract,, by fraud or strong pressure Thirdly, a person who is under a fiduciary duty to the plaintiff win not be allowed to retain property, or to refuse to account, for moneys received on the ground that, the property or.the moneys. have come into his hands as proceeds of an illegal transaction, [812 A-D]. The plaintiff's case was that at the pursuation of appellant's father the jewellery was entrusted to him. On the plaintiff's case the appellant's father was under a fiduciary duty to the plaintiff and he could not withhold the property entrusted to him on the plea that it was delivered with the object of defeating the claim of a third party.
(ii) The burden of proving that there was a debt and that the debt was avyavaharika or illegal lay upon the appellant. Granting that the defendant was after the, death of his father, unable to trace the jewellery entrusted, it could not be inferred that the jewellery was misappropriated by his father, There was no evidence in this case to prove that the debt- was avyavaharika or illegal. [813 A-C] Toshanpal Singh v. District Judge of, Agra, L.R. 61 I.A. 350, distinguished.
Supreme Court of India
Sita Ram vs Radhabai And Ors on 16 October, 1967
Equivalent citations: 1968 AIR 534, 1968 SCR (1) 805
