M. L. Abdul Jabbar Sahib vs M. V. Venkata Sastri And Sons

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

1969 Supreme(SC) 42

SUPREME COURT OF INDIA
S.M. SIKRI, R.S. BACHAWAT AND K.S. HEGDE, JJ.
M. L. Abdul Jabbar Sahib (In all the Appeals), Appellant
Versus
H. Venkata Sastri and Sons and others etc., Respondents.
Civil Appeals Nos. 272 to 274 of 1966,
D/- 4-2-1969.
Advocates Appeared
M/s. K. N. Balsubramaniam and R. Thiagarajan, Advocates, for Appellant (In all the appeals); Mr. R. Gopalakrishnan, Advocate, for Respondents Nos. 2 to 4 (In C. A. No. 272 of 1966), Respondents Nos. 1 and 2 (In C. A. No. 273 of 1966) and Respondent No. 1 (In C. A. No. 274 of 1966).

Advocates:
K.N.BALASUBRAMANIAN, R.GOPAL KRISHNAN, R.THIAGARAJAN

Headnote:GRIEVANCE AS TO LACK OF JURISDICTION - QUESTION OF FRAUD OR COLLUSION - SECOND PART OF SECTION 100 OF THE TRANSFER OF PROPERTY ACT DOES NOT ATTRACT SECTION 59 OF THE REGISTRATION ACT — SECURITY BOND IS NOT REQUIRED TO BE ATTESTED - Attested — meaning
       -a decree-holder who applies for rateable distribution of assets in the possession of the Court cannot challenge the decree in the execution of assets which are in the possession of the Court, making grievance that the Court passing it lacked territorial jurisdiction to pass it
       -cannot be considered by the Court under this Section

Judgement Key Points

The appellant instituted a suit under summary procedure against Hajee Ahmed Batcha for recovery under promissory notes. (!)
Hajee Ahmed Batcha obtained leave to defend on condition of furnishing security of Rs. 50,000 via a bond charging immovable properties, executed in favor of the Registrar. (!)
The security bond was registered but properties were outside the Madras High Court's original jurisdiction. (!)
Decree passed declaring the security bond enured as a charge for the decretal amount, with liberty to sell properties in default. (!) (!)
Respondents, simple money decree-holders, sought rateable distribution of sale proceeds from the charged properties. (!) [1000137120003]
Security bond attested by B. Somnath Rao; signatures of Sub-Registrar and identifying witnesses held not amounting to attestation. (!) [1000137120006][1000137120010][1000137120011]
"Attested" under Section 3, Transfer of Property Act, requires two or more witnesses who have seen execution or received acknowledgment and signed with animus attestandi in presence of executant. (!) (!) [1000137120007]
Signatures of registering officer or identifying witnesses prima facie for statutory purposes under Registration Act, not attestation, absent evidence of intent. (!) [1000137120009][1000137120010]
Section 100, Transfer of Property Act, first part allows charge by act of parties without restricting mode; second part applies simple mortgage provisions (excluding creation requirements like Section 59 attestation/registration). (!) [1000137120012][1000137120013][1000137120014][1000137120016][1000137120017]
Charge can be created without writing or attestation; registration required under Registration Act Section 17(1)(b) if value Rs.100+, but not attestation. (!) [1000137120015][1000137120016]
Decree construed as enforcing charge created by security bond, granting liberty to sell for discharge thereof. (!) [1000137120018]
Objection to court's territorial jurisdiction not raisable by rateable distribution applicants assuming valid sale.[1000137120019]
Proceeds of sale of charged properties applied first to discharge charge-holder's amount under Section 73(1), proviso (c), Code of Civil Procedure; balance only for rateable distribution.[1000137120020]
Appeals allowed; single judge orders restored, denying rateable distribution to respondents.[1000137120021] (!)

Judgement

BACHAWAT, J. On February 23, 1953 the appellant instituted C. S. No. 56 of 1953 on the Original Side of the Madras High Court under the summary procedure of Order 7 of the Original Side Rules against Hajee Ahmed Batcha claiming a decree for Rs. 40,556-1-2 and Rs. 832712-9 said to be due under two promissory notes executed by Hajee Ahmed Batcha.On March 9, 1953, Hajee Ahmed Batcha obtained leave to defend the suit on condition of his furnishing the security for a sum of Rs. 50,000 to the satisfaction of the Registrar of the High Court. On March 26, 1953 Hajee Ahmed Batcha executed a security bond in favour of the Registrar of the Madras High Court charging several immovable properties for payment of Rs. 50,000. The condition of the bond was that if he paid to the appellant the amount of any decree that might be passed in the aforesaid suit the bond would be void and of no effect and that otherwise it would remain in full force. The bond was attested by B. Somnath Rao. It was also signed by K. S. Narayana Iyer, Advocate, who explained the document to Hajee Ahmed Batcha and identified him. All the properties charged by the bond are outside the local limits of the ordinary original jurisdiction of the Madras High Court. The document was presented for registration on March 29, 1953 and was registered by D. W. Kittoo, the Sub-Registrar of Madras-Chingleput District. Before the Sub-Registrar, Haji Ahmed Batcha admitted execution of the document and was identified by Senkaranarayan, and Kaki Abdul Azib. The identifying witnesses as also the Sub-Registrar signed the document. Hajee Ahmed Batcha died on February 14, 1954 and his legal representatives were substituted in his place in C. S. No. 56 of 1953. On March 19, 1954 Ramaswami, J. passed a decree for Rs. 49,891-13-0 with interest and costs and directed payment of the decretal amount on or before April 20, 1954. While passing the decree, he observed:- "It its stated that the defendant has executed a security bond in respect of their immovable properties when they obtained leave to defend and this will stand enured to the benefit of the decree-holder as a charge for the decree amount."

2. Clauses 3 and 4 of the formal decree provided:-

"(3) that the security bond executed in respect of their immoveable properties by defendants 2 to 4 in pursuance of the order dated 9th March 1953 in application No. 797 of 1953 shall stand enured to the benefit of the plaintiff as a charge for the amounts mentioned in clause 1 supra;

(4) that in default of defendants 2 to 4 paying the amount mentioned in Cl. 1 supra on or before the date mentioned in Clause 2 supra the plaintiff shall be at liberty- to apply for the appointment of Commissioners for sale of the aforesaid properties."

3. The appellant filed an application for (a) making absolute the charge decree dated March 31, 1954 and directing sale of the properties; and (b) appointment of 1150 Commissioners for selling them. On April 23, 1954 the Court allowed the application, appointed Commissioners for selling of the properties and directed that the relevant title deeds and security bond be handed over to the Commissioners. The Commissioners sold the properties on May 29 and 30, 1954. The sales were confirmed and the sale proceeds were deposited in Court on July 2, 1954.

4. All the three respondents are simple money creditors of Hajee Ahmed Batcha. The respondents Venkata Sastri and Sons filed O. S. No. 13 of 1953 in the Sub-Court, Vellore, and obtained a decree for Rs. 5,500 on March 27, 1953. Respondent H. R. Gowramma instituted O. S. No. 14 of 1953 in the same Court and obtained a money decree on April 14, 1953. The two decree-holders filed applications for execution of their respective decrees. One Rama Sastri predecessor of respondents H. R. Chidambara Sastri and H. R. Gopal Krishna Sastri obtained a money decree against Hajee Ahmed Batcha in O. S. No. 364 of 1951/ 52 in the Court of the District Munsiff, Shimoga, got the decree trans

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1969 Supreme(SC) 42

Cases Referred (3)