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1939 Supreme(Mad) 153

IN THE HIGH COURT OF MADRAS
Wadsworth, J.
Vellayya Konar died and Anr.
Versus
Ramaswami Konar and Anr.
Decided On : 03.04.1939

The main legal point established in the judgment is the distinction between suits for cancellation of instruments and declarations of invalidity, and the appropriate legal provisions governing each type of suit.

Headnote:

Cancellation of Document - Suit under Section 53 of the Transfer of Property Act - Section 7(iv-A) of the Court-Fees Act - Article 17-A of Schedule II - Summary of Acts and Sections: The court discussed the distinction between a suit for the cancellation of an instrument and a suit for a declaration that the instrument is not binding upon the plaintiff. It referenced Unni v. Kunchi Amma I.L.R. (1890) 14 Mad. 26, Chathu Kutty Nair v. Chathu Kutty Nair (1923) 19 L.W. 249, Balakrishna Nair v. Vishnu Nambudiri (1930) M.W.N. 509, and Venkatasiva Rao v. Satyanarayanamurthi (1932) 62 M.L.J. 764 : I.L.R. 56 Mad. 212 to establish the legal principles governing suits for cancellation of instruments and declarations of invalidity.

Fact of the Case:

The plaintiff filed a suit under Section 53 of the Transfer of Property Act for a declaration that an alienation by the debtor is void against the creditors. The lower courts found the suit to fall under Section 7(iv-A) of the Court-Fees Act. The plaintiff sought a declaration that the properties conveyed to the first defendant are liable to be attached in realization of the decree debt obtained by the plaintiff against the second defendant.

Finding of the Court:

The court found that the suit falls under Article 17-A(1) of the Second Schedule of the Court-Fees Act and that the plaint had been wrongfully rejected by the lower courts. The appeal was allowed, and the suit was remanded to the trial court.

Issues: The main issue was whether the suit fell under Section 7(iv-A) of the Court-Fees Act or Article 17-A of Schedule II of the same Act.

Ratio Decidendi: The court clarified the distinction between a suit for the cancellation of an instrument and a suit for a declaration that the instrument is not binding upon the plaintiff, citing relevant case law to support its decision.

Final Decision: The appeal was allowed, and the suit was remanded to the trial court. Costs throughout will abide by the result of the suit. Court-fee paid here and in the lower appellate Court to be refunded.

JUDGMENT

Wadsworth, J.

1. The question raised in this appeal is whether a suit brought by a creditor under Section 53 of the Transfer of Property Act for a declaration that an alienation by the debtor is void against the creditors is a suit for cancellation of a document securing money or property falling under Section 7(iv-A) of the Court-Fees Act as amended in Madras, or whether it is a suit to obtain a declaration where no consequential relief is prayed, falling under Article 17-A of Schedule II of the same Act. Both the Courts below have found that the suit falls under Section 7(iv-A). The plaint recites that the properties in suit are in the possession and enjoyment of the second defendant against whom the plaintiff got a decree on a promissory note, the suit being filed on 2nd August, 1924 and decreed on 12th November, 1924. It is alleged that on 19th June, 1924, the second defendant, collusively and with a view to cheat the plaintiffs claim, executed a sale deed in favour of his brother-in-law, the first defendant, conveying all his properties benami and for no valid consideration, there being no intention that the sale deed should be given effect to. The plaintiff therefore prays for a declaration that the properties conveyed to the first defendant are liable to be attached in realisation of the decree debt obtained by the plaintiff against the second defendant and the plaint recites that the plaintiff sues for himself and as representing the other creditors of the second defendant. The judgments of both the Courts below seems to me to have proceeded on a misunderstanding of the cases quoted, one case in particular being quoted under one reference as supporting the plaintiff and the same case under another reference as supporting the contesting defendants and both the learned Judges seem not to have grasped the difference between a suit for the cancellation of an instrument and a suit for a dectefation that the instrument is not binding upon the plaintiff. Leaving aside for the moment the complication due to the fact that the plaintiff in this suit sues in a representative capacity, the distinction between the two classes of suits seems to me to be well established by the decisions. When the plaintiff seeks to establish a title in himself and cannot establish that title without removing an insuperable obstruction such as a decree to which he has, been a party or a deed to which he has been a party, then quite clearly he must get that decree or deed cancelled or declared void in toto and his suit is in substance a suit for the cancellation of the decree or deed even though it be framed as a suit for a declaration. But when he is seeking to establish a title and finds himself threatened by a decree or a transaction between third parties, he is not in a position to get that decree or that deed cancelled in toto. That is a thing which can only be done by parties to the decree or deed or their representatives. His proper remedy therefore, in order to clear the way with a view to establish his title is to get a declaration that the decree or deed is invalid so far as he himself is concerned and he must therefore sue for such a declaration and not for the cancellation of the decree or deed. This distinction was made clear in Unni v. Kunchi Amma I.L.R. (1890) 14 Mad. 26, which is followed in Chathu Kutty Nair v. Chathu Kutty Nair (1923) 19 L.W. 249, and the distinction is clearly observed in the cases quoted by the Court below, except that there is some obscurity arising from a decision of Ramesam, J., in Balakrishna Nair v. Vishnu Nambudiri (1930) M.W.N. 509, where though the learned Judge quite clearly has this distinction in mind, he frames his formula in rather more general terms than were perhaps desirable and on those grounds has been criticised by the Bench which decided the case of Venkatasiva Rao v. Satyanarayanamurthi (1932) 62 M.L.J. 764 : I.L.R. 56 Mad. 212. My attention has not been drawn to any decision which throw


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