Patna High Court
Srimati Kedarwati vs Radhey Lal And Anr. on 19 October, 1936
Equivalent citations: 170IND. CAS.353, AIR 1937 PATNA 609
JUDGMENT Wort, J.
1. There are two main questions in this appeal. One is whether the alienation is void under Section 53 of the Transfer of Properly A-ct, and the other is whether the defendant has got any title under Section 64 of the Code of Civil Procedure. I use the expression 'title' not in its strictest sense. The proviso to Section 64 of the Code states: "For the purposes of this section, claims enforceable under an attachment include claims for the rateable distribution of assets", and Section 64 makes void all transfers which are carried out in respect of a property under attachment in execution of a decree, and these transfers are void against all claims enforceable under the attachment. It is obvious in the first instance that a claim enforceable under the attachment is, for instance, a claim which would be made by a person purchasing the property attached and sold in execution of a decree, and as I have already pointed out, including those claims -as claims for rateable distribution.
2. Now, what happened was that on November 13, 1931, the decree-holder in the earlier suit purchased the property which he had attached in execution of his decree for a sum of upwards of Rs. 500, and having purchased it from the judgment-debtor, the judgment-debtor satisfied the decree. Then came the attachment of the defendant, which was apparently an abortive one, being made in October of 1931, in the Small Cause Court which had no jurisdiction in the matter; the application was ultimately transferred from that Court and made in the proper Court in the early days of 1932. At that time the attachment in the earlier suit had gone and it is not really seriously suggested that the defendant had any title other than that which had been given to him under the proviso to Section 61 of the Code. I had some hesitation at first in coming to a conclusion in this matter; but it is impossible to come to any but one conclusion having regard to the words of their Lordships of the Judicial Committee of the Privy Council in Mina Kumari Bibi v. Bijoy Singh Dudhuria 44 C 662 : 40 lnd. Cas. 242 : 1 PLW 425 : 5 LW 711 : 32 MLJ 425 : 21 CWN 585 : 21 MLT 344 : 15 ALJ 382 : 25 CLJ 508 : 19 Bom. LR 424 : (1917) MWN 473 : AIR 1916 PC 238 : 44 IA 73 (PC). The observation to which I refer is to be found on page 673 page of 44 C.--p[Ed.] of the report. There, in entering into the consideration of the respective titles of the parties in that matter, Sir Lawrence Jenkins in delivering the opinion of their Lordships of the Judicial Committee of the Privy Council said:
But it is unnecessary and inadvisable to deal further with this point, and more especially as there is another and surer answer to the decree-holder's plea.
3. He then refers to Section 295 of the Code of Civil Procedure then in force which is Section 73 of the present Civil Procedure Code, and observes that a right to rateable distribution is conditional upon their being assets in the hands of the Court. To use the words of Sir Lawrence Jenkins:
To bring Section 295 into play certain conditions are necessary, and one of them is that there should be assets held by the Court.
4. Quite clearly, having regard to the circumstances of this case it could not be held that there were any assets held by the Court; indeed the property had never been sold by the Court; it had been sold by private treaty and consequently no proceeds came into the hands of the Court. At first, having regard to the words used in the proviso to Section 64, it might be supposed that so long as there was a claim made or a possible claim in existence to rateable distribution, the absence of the condition precedent to which 1 have referred would not, in any way, affect the title of the party claiming rateable distribution; in other words, the only question to be determined would be whether the party had made an application to the Court for execution of the decree before the receipt of the assets. In my opinion the observations of their Lordships of the Judicial Committee and the plain reading of the section itself are too strong to come to any such conclusion and it is consonant with the obvious intention of the Legislature which can be discovered by asking oneself one question: how does the claim arise under an attachment? A claim can only arise under an attachment when some sort of transaction has taken place. A. person who proposes to purchase in a sale in execution of a decree a property which had been attached could not be said to have a claim under the attachment; not until he had purchased would such a claim arise. If the construction of Section 64 read with Section 73 of the Code, which is sought to be placed on those two sections by the learned Advocate appearing on behalf of the defendant, were the correct construction, then the person who has a claim to rateable distribution would be in a better position than a person whose claim is based on the actual purchase in the execution sale. But as I have already observed I think the decision of their Lordships of the Privy Council is final with regard to this point.
5. The only other question that remains is the question of Section 53 of the Transfer of Property Act and this raised a difficulty not by reason of any question of law by reason of the judgment of the Judge in the Court below. He holds that the intention of this sale on November 13, 193 L, to the plaint-tiff was to defeat the defendant, one of the creditors. It is suggested that there is no other intention, but there is no evidence on that point and that matter has not been gone into. If that was the intention, then there is adequate authority for the statement that that was not the transaction contemplated by Section 53 of the Transfer of Property Act. The decision of their Lordships of the Judicial Committee of the Privy Council in the well-known case of Musahar Sahu v. Hakim Lal 43 IA 104 : 32 Ind. Cas. 343 : 30 MLJ 116 : 3 LW 207 : 20 CWN 393 : 14 ALJ 198 : (1916) 1MWN 198 : 19 MLT 203 : 23 CLJ 406 : 18 Bom. LR 378 : 43 C 521 : AIR 1915 PC 115 (PC) is a clear authority on this question. There Lord Wrenbury made this observation:
So soon as it is found that the transfer here impeached was made for adequate consideration in satisfaction of genuine debts, and without reservation of any benefit to the debtor it follows that no ground for impeaching it lies in the fact that the plaintiff who also was a creditor was a loser by payment being made to this preferred creditor, there being in the case no question of bankruptcy.
6. The decision reported in Mina Kumari Bibi v. Bijoy Singh Dudhuria 44 C 662 : 40 lnd. Cas. 242 : 1 PLW 425 : 5 LW 711 : 32 MLJ 425 : 21 CWN 585 : 21 MLT 344 : 15 ALJ 382 : 25 CLJ 508 : 19 Bom. LR 424 : (1917) MWN 473 : AIR 1916 PC 238 : 44 IA 73 (PC) to which I have already referred is also to the same effect if any further authority were required. But the learned Advocate appearing on behalf of the defendant relies very strongly on the words of Lord Wrenbury "for adequate consideration" and it is said that in this case the Judge has found that the consideration was inadequate and that, therefore, the learned Judge in the Court below was entitled to hold that the transaction was void under Section 53 of the Transfer of Property Act. The learned Judge expresses himself in this way: "The sale was not for the benefit of the minor and the price was inadequate." There were other facts -which should have been mentioned. Of the consideration of upwards of Rs. 500 to which I have referred, approximately Rs. 170 was advanced or supposed to have been advanced for the purposes of a marriage. The learned Judges in the Courts below held that this sum was not advanced, but the only sum that was advanced, if any, was approximately Rs. 300. The trial Court came to the conclusion that no consideration passed. The Appellate Court is by no means emphatic on this question. It holds as I have said that the consideration was inadequate, but then proceeds on the assumption that a part of the consideration did in fact pass. I am asked to say that the finding of the learned Judge in the Court below was influenced by his misdirecting himself on the meaning of Section 53 of the Transfer of Property Act. I am rather in agreement with the argument that he has misdirected himself. It by no means follows that because a transfer was for the purpose of defeating one of the creditors, the intention of the transferor was not to defeat -ill the creditors. Having regard to the judgment of the trial Court and the judgment of the Appellate Court on this question, I find myself in very great difficulty in holding that as a matter of law the learned Judge was wrong. Lord Wrenbury in the case to which I have referred has definitely stated that one of the points which it is necessary to find in order to hold that the transaction was a valid one was that it was for adequate consideration. I do not mean to say by that that by the absence of such a finding it necessarily follows that a decision should be one way or the other, but I take it to be an indication given by their Lordships of the Judicial Committee of one of the matters which is to be taken into consideration in coming to a conclusion on this question. I may refer to the words of Ross, J. in a decision to which I was a party the decision in Deoki Nandan Singh v. Saiyed Jawad Hussain 9 PLT 5 : 106 Ind. Cas. 356 : AIR 1928 Pat. 199, which are: "This was not a voluntary transfer and it was not suggested that a consideration of Rs. 1,200 was insufficient, and then in another part of the judgment in relation to the consideration he says it was '' grossly inadequate." I do not think that it can be gathered from the judgment that it was necessary for a Judge to find that the consideration was grossly inadequate in order to entitle him to come to the conclusion that Section 53 of the Transfer of Property Act applied. As I said at the commencement of my observation, my real difficulty in this case, and my only difficulty, is to discover exactly what the intention of the learned Judge was in the Court below in expressing himself in the manner he has expressed himself, and on the whole I come to the conclusion that it was a judgment which perhaps, although to some extent moderating the decision of the trial Court, in substance confirmed it.
7. There was another point which was raised but which in the circumstances of the case I do not think it necessary to decide and that is whether the guardian who is described a guardian ad hoc in contradiction to guardian de facto had any right to enter into a contract on behalf of the minor. I have already said that in the circumstances of this case it is unnecessary to enter into this question.
8. In the result I am of the opinion that the decision of the learned Judge in the Court below cannot be interfered with, and the appeal, therefore, fails and must be dismissed with costs.