Orissa High Court
R.N.MISRA
Harekrishna Patra - Appellant
Versus
Banamali Roul - Respondent
Second Appeal No. 395 of 1966
Decided On : 07/31/1970
TRANSFER OF PROPERTY ACT, 1882 - SECTION 53 - SUIT TO AVOID TRANSFER - REPRESENTATIVE SUIT - SINGLE CREDITOR CANNOT MAINTAIN SUIT - SECTION 53 OF THE TRANSFER OF PROPERTY ACT, 1882 - SUIT TO AVOID TRANSFER - REPRESENTATIVE SUIT - SINGLE CREDITOR CANNOT MAINTAIN SUIT.
Fact of the Case:
Plaintiff sued under Order 21, Rule 63, C.P.C. for a declaration that the property sought to be proceeded against was liable to be executed against. Defendant No. 1 obtained a sale deed in respect of the disputed properties during the pendency of execution proceedings. The plaintiff claimed that the sale deed was benami and sought to avoid the transfer under Section 53 of the Transfer of Property Act, 1882.
Finding of the Court:
The court found that the sale deed was genuine and for consideration, and that the plaintiff was not entitled to the benefit of Section 53 of the Transfer of Property Act, 1882, as the suit was not instituted for the benefit of all the creditors.
Issues: Whether the sale deed was benami or sham.
Ratio Decidendi: A suit to avoid a transfer under Section 53 of the Transfer of Property Act, 1882, must be instituted for the benefit of all the creditors. A single creditor cannot maintain such a suit.
Final Decision: The appeal was dismissed.
JUDGMENT :- The plaintiff is in appeal against a confirming judgment of the learned First Addl. Subordinate Judge, Cuttack.
2. He sued under Order 21, Rule 63, C.P.C. for a declaration that the property sought to be proceeded against was liable to be executed against Defenddants 2 to 4 are brothers and members of a Hindu undivided family.
Defendant No. 2 for the family borrowed Rs. 500/-on 1-2-53 from the plaintiff upon a promissory note. As there was default of payment, Money Suit No. 43 of 1956 was filed by the plaintiff and he obtained a decree on 20-9-1957 for Rs. 821-12 and levied Execution Case No. 268 of 1958 for recovery of the said amount. The properties of the family were sought to be put to sale. The plaintiff who knew defendant No. 1 as one of his debtors relied upon him for supply of particulars of the properties. On the basis of the information given the plaintiff brought certain properties to sale and the decree-holder purchased the properties proceeded against. The execution case was dismissed on 23-9-59 on satisfaction. Thereupon one Bauribandhu Roul applied under Order 21, Rule 90, C.P.C. claiming the property. The said application was ultimately allowed and the auction sale was set aside. The plaintiff levied fresh execution case No. 14 of 1960. In the meantime defendant No. 1 who also happens to be a cousin of defendants 2 to 4 entered into collusion with the judgment-debtors and obtained a sale deed in respect of the disputed properties 3.96 acres in extent on 22-8-59. This sale deed was for Rs. 2000/-. Defendant No. 1 applied under Order 21, Rule 58, C.P.C. for release of the properties covered by the sale deed. His application was registered as Misc. Case No. 128 of 1960 and was ultimately allowed by order dated 30-1-1961 and the properties were allowed to be released from execution. Therefore, the present suit has been instituted.
3. Defendant No. 1 alone contested. According to him, the loan which was the basis of the money decree was denied and the benami character of Ext. B was also refuted. He contended that the entire consideration was paid before the Sub-Registrar and he acquired valid title. He claimed to be in possession.
4. The trial court found that Ext. B the sale deed in favour of defendant No. 1 was genuine, valid and for consideration; and defendant No. 1 had been put into possession. Accordingly it dismissed the suit. The learned Appellate Judge has affirmed the decree. That is how the plaintiff is in Second Appeal against the judgment of affirmance.
5. Two questions rightly arise in the present suit - as to whether the sale deed dated 22-8-59 (Ext. B) is benami or sham, and as to whether the plaintiff is entitled to the benefit of Section 53 of the Transfer of Property Act.
6. Their Lordships of the Supreme Court in AIR 1957 SC 49 (Sree Minakshee Mills Ltd. v. I.-T. Commr.) had occasion to examine the difference between "benami" and 'sham' transactions and they ultimately laid down that whether the document be sham or benami is a pure question of fact. Mr. Sinha rightly did not press that question further.
7. He, however, contended that the plaintiff was entitled to the benefit of Section 53 of the Transfer of Property Act, and the courts below have not properly taken that aspect into consideration. Section 53 of the Transfer of Property Act provides,
"(1) Every transfer of immoveable property made with intent to defeat or delay the creditors of the transferor shall be voidable at the option of any creditor so defeated or delayed.
Nothing in this sub-section shall impair the rights of a transferee in good faith and for consideration.
x x x x
A suit instituted by a creditor (....) to avoid transfer on the ground that it has been made with intent to defeat or delay the creditors of the transferor, shall be instituted on behalf of, or for the benefit of, all the creditors.
x x x x"
Mr. Sinha contends that the plaintiff was entitled to the benefit of this section and as such even though on the concurren
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