MINA KUMARI BIBI vs BIJOY SINGH DUDHURIA

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1916 Supreme(SC) 86

PRIVY COUNCIL [ON APPEAL FROM THEEAST INDIES]
LORD PARKER OF WADDINGTON, LORD SUMNER, SIR JOHN EDGE, AND SIR LAWRENCE JENKINS.
MINA KUMARI BIBI - Appellant
Versus
BIJOY SINGH DUDHURIA - Respondents
On Appeal From The High Court in Bengal.
Decided On : December 11, 1916.

Important Points

A private alienation is void under Section 276 of the Code of Civil Procedure, 1882, only if it occurs during the attachment in the specific execution proceedings. A prior attachment in a separate proceeding does not extend the scope of a subsequent attachment to void earlier alienations.

Subject

Civil Law - Execution of Decrees

Act Referred

CIVIL PROCEDURE CODE: S.276, S.295, S.88

Headnote

(A) Code of Civil Procedure, 1882 - Sections 276 and 295 - Private alienation of property during attachment - A private alienation of property made during the continuance of an attachment is void against all claims enforceable under that attachment - The reference to "attachment" in Section 276 refers to the specific attachment in the execution proceedings in which the order is made; an earlier attachment in a separate proceeding does not extend the effect of a subsequent attachment to void a private alienation that occurred before the latter attachment was effected.

(B) Transfer of Property Act - Section 53 - Fraudulent transfer - A debtor may pay debts in any order and prefer any creditor; such preference does not constitute a fraudulent transfer if consideration is provided and there is no evidence of fraudulent intention on the part of the transferee.

(C) Evidence - Presumption of date - There is a general presumption that a document was executed on the date it bears, which stands unless rebutted by legal testimony.

Facts of the case:
A purchaser of immovable property through a private sale sought possession against a purchaser at an execution sale. The property had been attached in 1902 under a decree, but those execution proceedings were subsequently dismissed. A second decree led to a new attachment in 1907, followed by an execution sale to the decree-holder. The private sale was dated prior to the 1907 attachment but after the 1902 attachment. The execution purchaser contended that the private sale was fraudulent, antedated, and void under the law due to the 1902 attachment.

Findings of Court:
The court found that the private sale was not fraudulent or benami as consideration was paid and a debtor is entitled to prefer creditors. The presumption that the sale deed was executed on the date it bore was not rebutted by evidence. Regarding the attachment, the private sale occurred before the 1907 attachment and therefore was not void under Section 276 of the Code of Civil Procedure, 1882. The 1902 attachment in a dismissed proceeding did not make the private alienation void in the context of the 1907 execution proceedings.

Issues: Whether the private alienation was fraudulent or antedated, and whether it was void under Section 276 of the Code of Civil Procedure, 1882, by virtue of a prior attachment in a separate execution proceeding.

Ratio Decidendi: The court held that Section 276 of the Code of Civil Procedure, 1882, applies only to the attachment in the specific execution proceedings under which the property is sold. A prior attachment in a different proceeding does not strengthen the position of a subsequent attachment to void a private alienation occurring before the current attachment. Additionally, preferring a creditor to whom a debt is owed does not constitute a fraudulent transfer under Section 53 of the Transfer of Property Act.

Result: Appeal allowed.

Legal Category Hierarchy

Advocates:
Solicitors for respondent: Watkins & Hunter.

Judgement

Appeal from a judgment and decree of the High Court (March 26, 1912) reversing a judgment and decree of the Subordinate Judge of Murshidabad (March 29, 1909).

The suit was instituted by the appellant against the respondent and one Chhatrapat Singh for a declaration that certain property-bought by the respondent at a sale in execution of a decree belonged to her at the date of the sale ; she also claimed possession and an injunction.

The appellant relied upon a purchase from the judgment debtor on July 15, 1907. The property had been attached on July 16, 1907, in execution of a decree obtained in 1901 against Chhatrapat Singh, the respondent being the decree-holder and, by leave of the Court, the auction purchaser. The property had been attached by the same decree-holder in 1902 under a decree obtained against Chhatrapat Singh in 1896. The facts as to the attachments appear fully from the judgment of their Lordships. Chhatrapat Singh did not appear in the proceedings.

The respondent by his written statement pleaded (inter alia) that the alleged purchase by the appellant was fraudulent and collusive, and relied further on the attachment in 1902.

Issues were framed of which the following only were material to the appeal (3.) Is the alleged transfer made to the plaintiff for con sideration and bona fide and a valid transaction, and does it in any way affect the defendants title ? (4.) Has the transfer been made during the subsistence of an attachment and for the purpose of defrauding creditors ?

The Subordinate Judge, upon a consideration of the evidence, found that there was good consideration for the transfer and that a fair value had been given for the property. He further held that it had not been proved that the properties were under an earlier attachment. He accordingly made a decree in the appellants favour.

Upon appeal the High Court reversed the decision. The learned judges found that the transfers to the appellant were antedated and that the whole transaction was a fraud. In view of these findings they found it unnecessary to consider whether the properties were under attachment at the date of the sale to the appellant.

1916. Nov. 10, 13, 14, 16. The arguments upon the appeal were addressed chiefly to the facts ; only those upon the right of the respondents in law under the attachment of 1902 are reported.

Upjohn, K.C., and Sir W. Garth, for the appellant.

De Gruyther, K.C., and Dube, for the respondent. The attachment of 1902 was subsisting at the date of the transfers to the appellant. Under s. 276 of the Code of Civil Procedure, 1882, the transfers to the appellant were void against all claims enforceable under that attachment. The respondents claim under the decree of 1896 was enforceable against the proceeds of sale under s. 295 of the Code ; the transfers were therefore void under s. 276. This is the true interpretation of ss. 276 and 295; it is now embodied in s. 64 of the Code of Civil Procedure, 1908 Sorabji v. Govind Ramji . (( 1891) I. L. R. 16 Bomb. 91, 95.) It was proved that the respondent had applied for a rateable distribution of the proceeds of the sale under s. 295. It is true that reliance was not placed upon this argument before the High Court; it was, however, raised in the grounds of appeal to that Court and by the respondents case in the present appeal; it is therefore open to the respondent Maharani Beni Koeri v. Dudh Nath Roy . (( 1899) L. R. 26 Ind. Ap. 216, 221.)

Upjohn, K.C., in reply. The auction sale at which the respondent purchased was under the execution proceedings of 1907, not under those of 1902, and the attachment in 1907 was admittedly after the transfers to the appellant. The attachment referred to in s. 276 is the attachment in the execution proceedings in which it is ordered. Sect. 295 has no application, since the attachment in 1907 was not operative. In any view the execution and attachment of 1902 had been abandoned before 1907.

Dec. 11. The judgment of their Lordshi