A sale of property after attachment is void as against the claim of the decree holder under Section 64 of C.P.C.

JUDGMENT

R.Raghunandan Rao, J. - The appellant herein purchased a property under a registered deed of sale dated 06.01.2015 registered as document No.60 of 2015. Thereafter, upon coming to know on 08.03.2018, that the said property is the subject matter of an Execution Petition bearing E.P.No.17 of 2016 in O.S.No.698 of 2014 in the Court of the XII Additional District Judge, Visakhapatnam, the appellant herein had moved E.A.No.14 of 2018 under Order XXI Rule 58 of C.P.C.

2. In the course of the said proceeding, the executing Court recorded the finding that the E.P. schedule property had been attached on 08.12.2014 in O.S.No.698 of 2014 and the execution of the deed of sale on 26.12.2014 in favour of the appellant and registration of the said deed of sale on 06.01.2015 is subsequent to the attachment of the E.P. schedule property. This finding is not disputed.

3. It appears that O.S.No.698 of 2014 had been filed by the 1st respondent herein against the 2nd respondent herein for recovery of an amount of Rs.18,65,000/- on the basis of a promissory note and after the initial attachment on 08.12.2014, the same was made absolute on 09.02.2016 vide order in I.A.No.1130 of 2014 in O.S.No.698 of 2014.

4. The contentions raised by the appellant, in the claim petition, was that the suit itself is a collusive suit under which the decree under execution, was obtained fraudulently and collusively and further the appellant was a bonafide purchaser for value and as such, the appellant cannot be disturbed from the ownership and possession of the said property.

5. The Executing Court, on the basis of Section 64 of the Code of Civil Procedure, had held that the sale of the E.P. schedule property executed in favour of the appellant is void and as such, the appellant cannot press the claim petition. The executing Court also considered the contention of the Appellant on the question of collusion between the parties and held that the said ground is not available as the scope of Order XXI Rule 58 of C.P.C. excludes such a ground. The trial Court also held that such a ground could be raised only in an application of Section 47 of C.P.C. and since the present application is under Order XXI Rule 58 of C.P.C, the said ground is not available. Similarly, the Court also concluded that the question of bonafide purchase does not arise in any application under Order XXI Rule 58 of C.P.C.

6. The Executing Court on the basis of the above findings had dismissed E.A.No.14 of 2018 on 06.02.2020. Aggrieved by the said order, the present appeal has been filed.

7. Heard Sri S.Subba Reddy learned counsel appearing on behalf of Sri T.V.Jaggi Reddy learned counsel, appearing for the appellant and Sri G.Ram Gopal learned counsel, appearing for the 1st respondent.

8. The undisputed facts in the present case are that the 1st respondent had obtained an attachment over the E.P. schedule property on 08.12.2014 and the same had been made absolute on 09.02.2016. The deed of sale relied upon by the appellant is said to have been executed on 26.12.2014 and registered on 06.01.2015. It is clear that the sale of the property in favour of the appellant was done only after the property had already been attached in O.S.No.698 of 2014.

9. Section 64 of C.P.C which reads as follows:

"64. Private alienation of property after attachment to be void-

(1) where an attachment has been made, any private transfer or delivery of the property attached or of any interest therein and any payment to the judgment-debtor of any debt, dividend or other moneys contrary to such attachment, shall be void as against all claims enforceable under the attachment.

(2)........

Explanation:..........

10. The consequence of this provision is that the sale made in favour of the appellant is void as against the claim of the 1st respondent. In the circumstances, the appellant cannot stand in the way of the execution of the judgment and decree passed in favour of the 1st respondent herein.

11. The contention of the appellant that