THE BODY OF CREDITORS OF PILER KHASIM SAHEB Vs. BHASKARA CHALAMIAH AND OTHERS
HIGH COURT OF ANDHRA PRADESH
The Body Of Creditors Of Piler Khasim Saheb
Bhaskara Chalamiah And Others
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CHANDRASEKHARA SASTRY,J. -
(1.) This second appeal arises in the following circumstances. The 2nd defendant executed a usufructuary mortgage (Ex-B. 1) d/17.8. 44 with respect to the suit property in favour of the 1st defendant for a sum of Rs.500/-. Under Ex-B. 2 dated 22.5.53 he executed a deed of sale with respect to the same property again for a sum of Rs. 500/- in favour of the 1st defendant, the consideration recited being for the discharge of the earlier usufructuary mortgage. One Piler Miah Saheb obtained on 30.7.53 a decree against the 2nd defendant in S.G. No. 384 of 1953 on the file of the Dist. Munsif "?s Court, Madanapalle and in execution of that decree sought to attach the suit property. There was a claim by the 1st defendant which was upheld. Hence this suit was filed by Piler Miah Saheb for himself and as representing the other creditors of the 2nd defendant to set aside the summary order in the claim petition E. A. 606 of 1955 on the file of Dist. Munsif "?s Court, Madanapalle. According to the plaintiff the sale deed Ex. B-2 dated 22.5.53 executed by the 2nd defendant in favour of the 1st defendant is a nominal document brought into existence to defeat and delay the creditors of the 2nd defendant. Thus the said alienation by sale was sought to be set aside under section 53 of the Transfer of Property Act. The 1st defendant pleaded that the sale in his favour was a real and bona fide one fully supported by consideration and for proper value. He further stated that the allegation in the plaint that the suit property was really worth Rs. 1,500/- was not true. It was further asserted that the 2nd defendant had no creditors other than the plaintiff, Piler Miah Saheb, and that therefore Section 53 of the Transfer of Property Act does not apply. The trial Court held that the suit property, which is land, is worth about Rs. 1,500/-and that it was nominally conveyed under Ex. B-2 to the 1st defendant with intent to defeat and delay the plaintiff "?s claim against the 2nd defendant and that the sale deed Ex. B-2 was in fraud of creditors. Hence, the suit was decreed. On appeal the learned Dist. Judge, Chittoor did not give any finding on the question whether the sale deed was a nominal one and was intended to defeat and delay the creditors of the 2nd defendant, though in a casual way he referred to the contentions of the parties and part of the evidence bearing on this question. But he held that there is no evidence in the case that the 2nd defendant had any other creditors than Piler Miah Saheb and that in his view Section 53 of Transfer of Property Act will not apply when the debtor who transferred his property had only one creditor, because on a fair reading of section 53 of Transfer of Property Act, according the learned Dist Judge, a debtor must be having more than one creditor so that section 53 of the Transfer of Property Act might be applied to any alienation made by him. In this view the appeal was allowed and the suit was dismissed. Hence this second appeal by the plaintiff.
(2.) The question for determination is whether section 53 of the Transfer of Properly Act can be applied to any alienation when the debtor had only one creditor at the time when the suit was filed. Strong reliance is placed upon the language of section 53 of the Transfer of Property Act by Mr. Ramamohana Rao, the learned counsel for the contesting respondent who is the 1st defendant, which refers to every transfer of immovable property made with intent to defeat or delay the "Creditors" of the transferor. The reference to "creditors" in this part of the section, according to the learned counsel, clearly indicates that unless there was more than one creditor in existence at the time the suit was filed, the alienation cannot be challenged under section 53 of the Transfer of Property Act. The lower Court relied upon a decision of a single judge of the Madras High Court in Theher Unnisa Begum v. Sherfunnisa Begum AIR 1955 Mad. 446 . In that case the main ground on which the case was disposed of was res judicata. There was no suit at all filed under section 53 of the Transfer of Property Act in a representative capacity. The learned Judge then pointed out that there was no allegation in that case by the decree-holder therein that the transfer by the husband in favour of his wife was made in order to defeat or delay and defraud his creditors and that he was entitled to avoid the transfer, on the ground that it had been made with intent to defeat or delay the creditors. Then the learned Judge observed as follows:-
"Simply because the lower Court observed, in its order, that this patta transfer was made with a view to defeat and delay the present decree-holder, Section. 53 will not be invoked. It is significant to note that the lower court itself did not say that the transfer was made with a view to defeat and delay the creditors, but only to defeat and delay the present decree-holder, one creditor of his Section 53 will apply, by when the transfer is made with intent to defeat and delay the creditors of the transferor, and not one single known creditor and that one the executing decree-holder."
(3.) It is on this last sentence in the judgment of the learned Judge that reliance is placed by the Court below and again before me by Mr. Ramamohana Rao in support of his contention. It may be noticed that this is only a casual observation by the learned Judge and that it was made by way of obiter. This observation cannot be taken as an authority for the position contended for by the learned counsel for the respondent.;
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