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1979 Supreme(Raj) 279

RAJASTHAN HIGH COURT
K.D.Sharma, J.
Bhalle Chand And Ors - Appellant
Versus
Tej Raj And Ors - Respondent
S.B. Civil Regular Appeal No. 70 of 1968.
Decided On : 23-03-1979

A sale of property made after attachment is not void if the attachment was not complete and valid. However, a sale of property made with the purpose of cheating creditors and fraudulently converting the property into money so as to render it incapable to satisfy the debts due to them is void.

Headnote:

ATTACHMENT OF PROPERTY - VOID ATTACHMENT - SALE OF PROPERTY AFTER ATTACHMENT - VALIDITY - FRAUDULENT TRANSFER - SECTION 53 OF THE TRANSFER OF PROPERTY ACT, 1882 - INTERPRETATION AND APPLICATION.

Fact of the Case:

Kojiya, a judgment debtor, sold his 'Nohra' (house) to the appellants after it was attached by the court in execution of a decree obtained against him by the respondents. The appellants claimed ownership of the 'Nohra' under Order XXI Rule 58, Article of the Code of Civil Procedure, 1908, but their claim was dismissed by the execution court. They then filed a suit under Order XXI Rule 63, Article to establish their title to the 'Nohra'. The trial court and the appellate court dismissed the suit, holding that the sale was void as it was made after the attachment and that it was fraudulent.

Finding of the Court:

The High Court held that the attachment of the 'Nohra' was not complete until a copy of the proclamation order was affixed on a conspicuous part of the court house, which was done on April 20, 1963. Therefore, the sale of the 'Nohra' made by the judgment-debtor in favor of the appellants on April 19, 1963, was not void. However, the court found that the sale was fraudulent as Kojiya, the judgment-debtor, transferred the 'Nohra' with the purpose of cheating his creditors, namely, the respondents, and fraudulently converted the 'Nohra' into money so as to render it incapable to satisfy the debts due to him.

Issues: 1. Whether the attachment of the 'Nohra' was complete and valid? 2. Whether the sale of the 'Nohra' made by the judgment-debtor in favor of the appellants was void? 3. Whether the sale was fraudulent?

Ratio Decidendi: 1. The court held that the attachment of the 'Nohra' was not complete until a copy of the proclamation order was affixed on a conspicuous part of the court house, which was done on April 20, 1963. Therefore, the sale of the 'Nohra' made by the judgment-debtor in favor of the appellants on April 19, 1963, was not void. 2. The court held that the sale was fraudulent as Kojiya, the judgment-debtor, transferred the 'Nohra' with the purpose of cheating his creditors, namely, the respondents, and fraudulently converted the 'Nohra' into money so as to render it incapable to satisfy the debts due to him.

Final Decision: The High Court dismissed the second appeal filed by the appellants, holding that the sale of the 'Nohra' was fraudulent and the appellants could not succeed in proving that their father Bhalle Chand was not a party to the design of Kojiya transferor & he did not share Kojiya's intention to defeat and delay His creditors Tej Raj and Babu Lal.

JUDGMENT

1. This is a Civil Second Appeal preferred by Bhalle Chand and Ukh Chand against the judgment and decree passed in appeal by the Civil Judge, Jalore, on December 5, 1967, by which the judgment and decree of the Munsiff, Jalore, dismissing the suit of the appellants under Order XXI Rule 63, Article was upheld and maintained.

2. The brief facts giving rise to this second appeal may be briefly stated as follows : Tej Raj and Babu Lal plaintiff respondents obtained a money decree against Kojiya and Moda respondents Nos. 3 and 4 for Rs. 1681/-, with costs, pendente lite and future interest from the court of the Munsiff, Jalore, and in execution of the decree got attached one house, i.e. 'Nohra' situated at village Balwara The appellants and Sardar Mal preferred a claim in respect of this 'Nohra' under Order XXI Rule 58, Article on the ground that this 'Nohra' belonged to ownership and possession at the time of attachment Their claim was dismissed by the court of the execution on August 19, 1964, on the ground that it was unnecessarily delayed Aggrieved by this order, the defeated claimants i.e. the appellants and Sardar Mal filed a suit under Order XXI Rule 63, Article to establish their title to the 'Nohra' in dispute by obtaining a declaratory decree against the respondents, In the suit filed by the defeated claimants, it was alleged that the 'Nohra' under attachment was purchased by way of a registered sale deed from its owner Kojiya, judgment-debtor, for Rs. 400/-, on April 19, 1963, and since then the defeated claimants have been in continuous possession thereof as owners. Tej Raj and Babu Lal, respondents, hotly contested the suit filed by the defeated claimants on several grounds which are mentioned in their written-statement The main ground on which the suit was resisted was that the alleged sale of 'Noh a' in favour of the defeated claimants was made by Kojiya, judgment debtor, after the property was attached and therefore, the sale was void. In the alternative, it was further pleaded that the sale was an outcome of collusion between the defeated claimants and Kojiya, judgment-debtor, who fraudulently sold away the 'Nohra' to the appellants and Sardar, Mai with intent to defeat or delay his creditors, i.e. Tej Raj and Babulal, respondents.

3. Upon pleadings of the parties, the learned Munsiff framed as many as following four issues in the case:

1. Whether the house under attachment was in possession of the plaintiffs and they were its owners?

2. Whether the sale of the house under attachment has been effected after the attachment and, as such, was inoperative and void?

3. Whether the sale of the house under attachment was fraudulent? If so. its effect?

4. What would be the relief? and recorded the evidence of the parties on them The learned Munsiff then considered the entire evidence oral as well as documentary on the record and decided issues Nos. 1 and 3 in favour of the respondents' Nos. 1 and 2 white issue No. 2 was decided by him against the plaintiff-appellants Accordingly, the learned Munsiff dismissed the suit of the appellants and Sardar Mal, proforma respondent, but left the parties to bear their own costs. Aggrieved by this judgment and decree, the appellants and Sardar Mal filed an appeal in the court of the Civil and Additional Sessions Judge, Jalore. The learned Civil Judge after hearing the parties, upheld the judgment and decree of the learned Munsiff and dismissed the appeal leaving the parties to bear their own costs throughout. As against the judgment and decree of the Civil Judge, the defeated claimants have come up to this Court in Secord. Appeal During the pendency of the appeal, Bhalle Chand died and his legal representatives Smt. Choga Bai, Okh Chand & Smt. Mohan Bai were brought on the record is appellants.

4. I have carefully perused the record and hear Mr. S.N. Vyas. learned Counsel for the appellants and Mr. Jaswant Mal Bhandari, appearing on behalf of the respondents It has been contended on







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