An equitable assignment of an actionable claim, including the equitable assignment of stamps, has to be effected in accordance with Section 130 of the Transfer of Property Act.

( 1 ) THIS second appeal by the 1st defendant arises out of a suit filed by the plaintiff to set aside the summary order dated 24-2-1960 passed by the District Munsif, Peddapuram in I. S. 129 / 60 in O. S. No. 10/60 on the file of that Court. It was alleged inter alia in the plaintiff that the 1st defendant filed a suit, O. S. 10/60 against the 2nd defendant on the foot of a promissory note and attached the stamps belonging to the 2nd defendant under Order 38, Rule 5 C. P. C. The plaintiff filed a claim petition objecting the attachment on he ground that the 2nd defendant had entered into an agreement with him whereunder the plaintiff agreed to advance necessary funds for the purchase of stamps and the 2nd defendant agreed to keep the stamp papers in the possession of the plaintiff as security for the amounts thus advanced. It was also agreed that the plaintiff or his nominee would be present at the time when the stamps are sold, so that the amounts thus realised would be handed over to the plaintiff towards the payment of the advances he had made. It was therefore contended that the plaintiff has a preferential right to recover the money from the sale proceeds of the stamps and that the stamps therefore cannot be attached. The 1st defendant denied the execution of any agreement and also questioned the validity of the agreement. Upon these pleadings the trial court framed appropriate issues and after recording the evidence of the parties dismissed the plaintiffs suit. It was held that the agreement has not been satisfactorily proved, and that it is invalid.

( 2 ) DISSATISFIED with the judgment the plaintiff preferred an appeal to the Principal Subordinate Judge, Kakinada. His appeal was allowed. It was held by the learned Subordinate Judges that the agreement pleaded by the plaintiff is true, valid and binding on the 1st defendant. He also held that the agreement amounts to an equitable assignment of the stamps attached by the 1st defendant and the plaintiff therefore is entitled to a preferential right in respect of the stamps. It is this view of the learned Subordinate Judge that is now assailed in this second appeal.

( 3 ) THE principal contention of Mr. A. Gangadhara Rao, the learned Counsel for the appellant, is that the agreement in question does not amount to a transfer within the meaning of Section 130 of the Transfer of property Act (hereinafter called the Act) and that the agreement therefore does not create any right in the plaintiff to claim preferential payment. In any case his argument is that the plaintiff is not entitled to claim preferential rights in respects of the stamps.

( 4 ) IN order to appreciate the above contention it becomes necessary to read the definition of actionable claim occurring in Section 3 of the Act. It reads as follows: " actionable claim means a claim to any debt, other than a debt secured by mortgage of immovable property or by hypothecation or pledge of moveable property, or to any beneficial interest in movable property not in the possession, either actual or constructive, of the claimant, which the Civil Courts recognize as affording grounds for relief, whether such debt or beneficial interest be existent, accruing conditional or contingent. "

( 5 ) SECTION 130 of the Act which is of great materiality reads as follows : "130 (1) The transfer of an actionable claim whether with or without consideration shall be effected only by the execution of an instrument in writing signed by the transferor his duly authorised agent. . . . . . . . . . shall be complete and effectual upon the execution of such instrument, and thereupon all the rights and remedies of the transferor, whether by way of damages or otherwise, vest in the transferee, whether such notice of the transfer as in hereinafter such notice of the transfer as is hereinafter provided be given or not : Provided that every dealing with the debt or other actionable claim by the debtor or other person from or against who