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2004 Supreme(Bom) 1121
IN THE HIGH COURT OF BOMBAY
Daga V.C., J.
Subhash Bhimashankar Kalase .... Appellant.
Versus
State Bank of India.... Respondent.
Appeal from Order Nos. 887-900, decided on 9-8-2004.
Advocates appeared :
G.S. Godbole, for appellant.
G.D. Uttangale, for respondent-Bank.
Headnote:Civil Procedure Code, 1908 - Order 38, Rule 5 - Attachment before Judgment - Can be made where defendant is about to dispose whole or part of his property - Not where the property already disposed of much before filing of suit - Purchaser purchased property before filing of suit - In possession has right to object order of attachment before judgment - This property cannot be attached under Order 38, Rule 5 of CPC - Order of attachment bad and illegal. - The object of the provision of Order 38, Rule 5 is to prevent any attempt on the part of the defendant to defeat the realisation of the decree that may be passed against the defendant. Order 38, Rule 8 provides a provision for adjudication of claim to property attached before judgment. Where any claim is preferred to property attached before judgment, such claim has to be adjudicated upon in the manner provided for the adjudication of claims to the property attached in execution of decree for the payment of money. It is very clear from the provisions of Order 38, Rule 8 that the procedure to be followed in the adjudication of claims under that rules is same as that provided by Order 21 Rule 58 for adjudication of claims to property attached in execution of a decree.
The claimant to the property attached before judgment has to show that on the date of attachment he had some interest or was possessed of the property attached. The appellant herein is claiming interest in the property in dispute and it is required to be ad-judicated upon as provided by Order 21 Rule 58 of the CPC. The property in question admittedly, belonged to the appellant. He is in possession of the property in question. He purchased this property on 4.10.2001. The defendant No. 2 has no interest in the property as on the date of attachment. Appellant has a direct interest in the property. He being in possession of the property, he has a right to object to the order of attachment before judgment passed under Order 38 Rule 5 of the CPC. His property could not have been attached under this provision. Firstly because he is not a party to the suit. Secondly, because he has become owner of the property much before filing of the suit as such order of attachment is bad and illegal.
Civil Procedure Code, 1908 - Order 38, Rule 5 - Attachment before judgment. - Purchaser of mortgaged property, being in possession has a right to object to order of attachment before judgment. - The amount of various loan facilities were made available by the plaintiff - Bank to the defendant No. 1 against security of his own immovable property. The said properties were equitably mortgaged, in favour of the Bank. The property which was mortgaged by the guarantor in favour of the Bank was sold by him. Plaintiff bank filed suits against the principal borrower and guarantor, defendant Nos. 1 and 2 for recovery of their outstanding dues in various loan accounts. The purchaser of the property had a direct interest in the property. He being in possession of the property, he has a right to object to the order of attachment before judgment passed under Order 38, Rule 5 of Civil Procedure Code. His property could not have been attached under this provision. Firstly, because, he is not a party to the suit. Secondly, because he has become owner of the property much before filing of the suit as such order of attachment is bad and illegal. The provision would apply where the defendant is about to dispose whole or part of the property and not where the property has already been disposed of much before the filing of the suit. 1991(1) SCC 715, 1990(3) SCC 291 - Relied, AIR 1941 Bom 198, AIR 1943 Bom 145, AIR 1973 Cal 432, Approved AIR 1971 P&H 381 - Overruled.
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FACTUAL MATRIX:
2. The factual matrix lies in narrow compass. The State Bank of India, respondent No. 1-original plaintiff ("the plaintiff" for short) made available various financial facilities to respondent No. 2-original defendant No. 1, ("the borrower" for short) respondent-No. 3-original defendant No. 2 ("the guarantor" for short) guaranteed repayment of the various financial facilities availed by the borrower.
3. The amount of various loan facilities were made available by the plaintiff-Bank to the defendant No. 1 against security of his own immovable property bearing Sub-plot No. 82, F.P. No. 26, Survey No. 156-A along with structure standing thereon and also against the security of immovable property of the guarantor bearing CTS No. 10430 F.P. No. 21/52, TPS; 1, Solapur. The said properties were equitably mortgaged, in favour of the Bank, by the defendants to secure various loan facilities made available by the plaintiff-bank.
4. The property which was mortgaged by the guarantor in favour of the bank was sold by him on 13-6-2001 by executing a registered sale deed in favour of one Sidhram Shamrao Kore for 5 Rs. 6,00,000/-. The said transaction of sale finds place in the record of the Sub-Registrar, Solapur, at Sr.No. 2956. The name of purchaser Shri Sidhram Shamrao Kore also finds place in the record of City Survey.
5. The appellant, Shri subash desired to purchase the aforesaid property from Shri Sidhram Kore. He, after some negotiations, entered into an agreement for purchase on 21-10-2001. He, prior to purchase, issued a public notice in daily "Sanchar" having wide circulation in Solapur, to invite objection if any, to the said proposed transaction of purchase. He did not receive any objection. He, thus, purchased the said property by a registered sale-deed dated 4-10-2001 from Shri Sidhram Kore, registered at Sr.No. 5255. On 28-1-2002, the name of the appellant was entered in the PR Card of the said property.
6. Respondent No. 1-plaintiff bank filed 13 separate suits bearing Spl. Civil Suit Nos. 258/02 to 268/02 and 273/02 to 275/02 against the principal borrower and guarantor, original defendant Nos. 1 and 2 respondent Nos. 2 and 3 herein; for recovery of their outstanding dues in various loan accounts.
7. In each suit, respondent No. 1-bank moved separate application under Order 38, Rule 5 of the C.P.C. for attachment before judgment. The trial Court directed attachment before judgment of the property bearing CTS No. 10430, FP No. 21/52, TPS 1 of Solapur, under Order 38, Rule 5 of the C.P.C.
8. The appellant, on 25-11-2002 came to know about the ex parte order of attachment before judgment. He, therefore, moved separate applications in all the suits for vacation of the order of attachment, contending that he having become owner of the property before filing suits and that not being party to the suits, his property could not have been attached. He also contended that he being a purchaser of the suit property from vendee of the guarantor, did not know about the loan transaction between parties to the suit as such he being a bona fide purchaser his property in question could not have been attached. He, thus, urged that the said property is not available for attachment.
9. The original plaintiff bank countered aforesaid challenge to the attachment before judgment, contending, the property in question being equitably mortgaged by defendant No. 2, with the bank on 25-11-1997, the same could not have been sold by him. The plaintiff-bank also urged that issuance of public notice is of no consequence. The title deeds of the property in question bei
