High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE E. PADMANABHAN
Vengalaveeran
Versus
Rajendran and 4 others
C.R.P. No. 399 of 1996 and C.M.P. Nos.2425 and 5737 of 1996
Decided On : 30-07-1997
ATTACHMENT BEFORE JUDGMENT - ORDER 21, RULE 54(3) C.P.C. - ATTACHMENT DEEMED AGAINST TRANSFEREES WITHOUT CONSIDERATION - SUMMARY OF FINDINGS AND INTERPRETATIONS OF THE COURT.
Fact of the Case:
The petitioner, who was unsuccessful in E.A.36 of 1994 and C.M.A. No. 44 of 1995, filed a revision petition challenging the order of attachment of his property in execution of a decree. The petitioner claimed that he had purchased the property before the attachment was effected and that he was a bonafide purchaser for value without notice of the attachment.
Finding of the Court:
The court found that the petitioner had full knowledge of the order of attachment dated 6. 1986 and that the sale deed in his favor was executed with the object of defeating the claims of the creditor. The court also found that the sale transaction was not supported by consideration and that possession of the property continued with the judgment debtor.
Issues: 1. Whether the order of attachment passed on 6. 1986 and effected on 16. 1986 will have any effect on the purchase made by the petitioner on 16. 1986? 2. Whether the petitioner's claim petition is belated as he had come immediately after attachment in the execution petition? 3. Whether the order of attachment takes effect only from the date or time on which it was effected and not from the moment it was passed? 4. Whether fraud on the creditor has to be raised in the form of a suit and not as a defence in the application?
Ratio Decidendi: 1. The court held that the order of attachment passed on 6. 1986 and effected on 16. 1986 will have effect on the purchase made by the petitioner on 16. 1986, as the petitioner had full knowledge of the attachment and the sale transaction was not supported by consideration. 2. The court held that the petitioner's claim petition is belated as he had full knowledge of the first attachment and kept quiet for several years without filing an application to raise the attachment or a claim petition. 3. The court held that the order of attachment takes effect from the moment it is passed and not from the moment it is effected. 4. The court held that fraud on the creditor can be raised as a defence in the application and it is not necessary to file a suit.
Final Decision: The revision petition was dismissed.
1. The petitioner, who was unsuccessful in E.A.36 of 1994 on the file of Sub Court, Pattukottai, as well as C.M.A. No. 44 of 1995 on the file of District Court, Thanjavur, is the revision petitioner.
.2. The revision petitioner filed E.A. No. 36 of 1994 in E.P. No. 2 of 1993 in O.S. No. 43 of 1986 on the file of Sub Court, Pattukottai under Order 21, Rule 58 C.P.C. to raise the attachment dated 2. 1994. It is the case of the revision petitioner that he had purchased the property on 16. 1986, that he is the exclusive and absolute owner of the suit property, that he has been in enjoyment of the same, that the order of attachment effected on 2. 1994 as if it is still owned by respondents 3 to 7 judgment debtors, is a misconception, that he property is not liable to be attached, that deliberately his property had been attached and that the order of attachment is illegal, inoperative and the same is liable to be set aside.
3. The contesting respondents 1 and 2 filed a detailed counter. It has seen contended that the suit properties were owned by the judgment debtors, that the sale deed in favour of the petitioner is a sham and nominal transaction that no sale consideration has been paid for the alleged purchase, that with full knowledge of the order of attachment, the deed of conveyance had been executed, that in terms of Order 21, Rule 54(3) the order of attachment shall be deemed to have been made against the transferees without consideration from the judgment debtor from the date of the order of attachment and that the petitioner not being a bonafide purchaser, but a mere name lender, has not acquired valid title to the property and the property has been attached by order dated 6. 1986 and it is not as if it is now being attached only on 2. 1994. It was further contended that the application to raise the attachment filed by the petitioner is highly belated and it is not a bonafide application.
4. The petitioner filed Exs.P.1 to P.6 and examined P.Ws.1 and 2. Respondents 1 and 2 marked Exs.R.1 to R.5 and examined R.W.1, the power of attorney agent of the 1st respondent.
5. The executing Court, on a consideration of oral and documentary evidence, rendered a definite finding that with full knowledge of the attachment order dated 6. 1986, Ex.P.1 sale deed had been created without payment of any consideration, that a sham and nominal sale deed has been created with a view to defeat the claims of the decree-holder, that the claim petition is highly belated as the first attachment was ordered on 6. 1986 and the claimant had purchased the same only on 16. 1986 with full knowledge of the order of attachment.
6. On appeal in C.M.A. No. 44 of 1995, the lower appellate court held that the petitioner cannot maintain the application as he had not established that he was in possession on the date of attachment, when the earlier attachment is valid, that with full knowledge of the order of attachment, the deed of conveyance had been executed with a view to defeat the claims of the creditors, that the attachment before judgment ordered on 6. 1986 had been made absolute on 16. 1986 and the purchase on 16. 1986 by the petitioner is invalid and that the petitioner was very much aware of the attachment ordered on 6. 1986 as deposed by R.W.1.
7. The lower Appellate Court also found that the order of attachment was made in I.A. No. 189 of 1986 on the file of the vacation civil court, Thanjavur on 6. 1986, and that only with knowledge of the said order of attachment, the defendant in the suit had executed the conveyance deed in favour of the petitioner with a view to screen the property from being proceeded. The first appellate court had confirmed the fair and decretal order passed by the executing court.
8. In the present revision petition, learned counsel for the petitioner contended that the order of attachment before judgment ordered on 6. 1986 was effected only on 16. 1986 and as such, when the purchase has been completed on 1
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