High Court Of Madhya Pradesh
T. C. Shrivastava and H. R. Krishnan, JJ.
SHANTILAL BARDICHAND MAHAJAN - Appellant
Versus
CHAMPALAL RADHAJI - Respondents
First Appeal 40 Of 1957
Decided On : 11/29/1961
TRANSFER OF PROPERTY ACT - SECTION 53 - REPRESENTATIVE SUIT - OMISSION TO OBTAIN PERMISSION AND ISSUE NOTICE - REMEDY AT APPELLATE STAGE - SECTION 99, C. P. C. - SECTION 42, SPECIFIC RELIEF ACT - DECLARATORY SUIT BY CREDITOR BEFORE DECREE AND ATTACHMENT.
Fact of the Case:
A suit was filed by four creditors under Section 53 of the Transfer of Property Act, alleging that a sale of a house by their debtors was made with the intention of defeating and delaying them in their realization of the debts. The plaintiffs sought permission to sue in a representative capacity and notices to be issued to other creditors, but the permission and notices were not obtained or issued. The trial court decreed the suit, declaring the sale void and inoperative as against the creditors. The transferee appealed, arguing that the suit should be dismissed for want of permission and notice.
Finding of the Court:
The court held that the suit was properly brought under Section 53 of the Transfer of Property Act, as the transfer was prima facie valid and would be operative but for any action taken by the creditors. The court also held that the omission to obtain permission and issue notice was an inadvertent mistake, without any ulterior purpose on the part of the plaintiffs, and that it could be remedied at the appellate stage.
Issues: (i) Whether the suit is really one under Section 53, Transfer of Property act. (ii) If so, whether the recital in the plaint, and the absence of express permission, and of notice, under Order 1 Rule 8, C. P. C. , is a disability that can be raised in appeal. (iii) In case it is found necessary that they are necessary, whether the permission can be granted by this Court now, and the notice directed to be issued in this appeal. (iv) In case this suit is not one under Section 53, Transfer of Property act, if it can be treated as one by the four creditors in their individual capacity, whether under Section 42, Specific Relief Act or generally without reference to that section, but on lines of similarity to the illustration regarding reversioner's suits.
Ratio Decidendi: The court held that the omission to obtain permission and issue notice was not a mere technicality curable under Section 99, C. P. C., as it affected the decision by depriving the other creditors of the opportunity to join the suit. However, the court also held that the omission could be remedied at the appellate stage, as the nature of the suit was not changed. The court further held that the suit could not be treated as one brought by the four creditors in their individual capacity under Section 42 of the Specific Relief Act, as they did not have a legal right to the property at the time of the suit.
Final Decision: The court granted permission to the plaintiffs to sue in a representative capacity and directed that notices be issued to all the creditors of the defendants, informing them of the suit and inviting them to join as creditors-respondents. The court also ordered that if the process-fee was not filed within three weeks, the suit would be treated as one in the individual capacity and the appeal disposed of accordingly.
( 1 ) THIS is an appeal by the transferee, by the ostensible sale for Rs. 10000/-, of a house by his father and his uncle, (who at that time ware indebted to the time of at least Rs. 7000/-, and had no other properties of much value), from the judgment and decree of the Civil Judge, Class I, Dhar, declaring the said sale void and inoperative as against the creditors, four of whom sued, in accordance with, though without mentioning, Section 53, Transfer of Property Act. The appellant had raised quite a number of questions in the memorandum, but in argument, the only ground pressed is that the suit should be dismissed, as there is no order permitting the four creditors to sue in a representative capacity, and no notices issued on the other creditors (known or unknown) at the instance of the plaintiffs.
( 2 ) THE questions for decision are :
(i) Whether the suit is really one under Section 53, Transfer of Property act. (ii) If so, whether the recital in the plaint, and the absence of express permission, and of notice, under Order 1 Rule 8, C. P. C. , is a disability that can be raised in appeal. (iii) In case it is found necessary that they are necessary, whether the permission can be granted by this Court now, and the notice directed to be issued in this appeal. (iv) In case this suit is not one under Section 53, Transfer of Property act, if it can be treated as one by the four creditors in their individual capacity, whether under Section 42, Specific Relief Act or generally without reference to that section, but on lines of similarity to the illustration regarding reversioner's suits.
( 3 ) THE facts of the case are simple. The defendants Nos. 1 and 2 Onkarlal and bardicnand, uncle and father respectively of the appellant, had borrowed in 1951 money, at least from these four creditors, a total of Rs. 6700/- in round figures. On 19-6-1952 they sold a house the identity of which is not in dispute, to the appellant (defendant No. 3 in suit), son of defendant No. 2 and nephew of defendant No. 1, who had lust then come of age. The deed was registered, and the ostensible consideration was Rs. 10,000/- which in the lower court the defendant No. 3 tried to show, unconvincingly however, had been received by him from his maternal grandmother. The four creditors filed the present suit on 8-71953 alleging that the transfer had been made with the intention of defeating and delaying them in their realisation of the debts. Inter alia it was pleaded :
"the defendants 1 and 2 have effected this sale fraudulently iksdy rksjls This sale is with the purpose of delaying the plaintiffs and other creditors in their realisation; the plaintiffs and the other creditors may not be able to realise their debts from this house. Accordingly, this has no effect in the eye of law and should not bind the plaintiffs. " "the plaintiffs are filing this suit for themselves and for other creditors and seek permission that they might do so on behalf of the other creditors. "
It was a representative suit, and permission was expressly sought. When seven months,after the filing of the plaint, a written statement was filed, neither was there an order of permission, nor the issue of notice under Order 1 Rule 8, but no grievance was made of this omission. We do not hear of these two topics at any time during the trial; nor was this raised in the argument or discussed in the judgment which was delivered about four years later on 20-8-1957. In the memorandum of appeal, the absence of order and the notice were not raised as such; but the position sought was that having alleged that the sale itself was void in the eye of law, the plaintiffs should not have brought a suit to avoid it. In argument, however, the appellant's position is that this is a suit under Section 53 transfer of Property Act, and the absence of the permission and the notice on other creditors is fatal, and it should be dismissed.
( 4 ) GROUND No. (i):--Section 53, T. P. Act, presupposes a transfer
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