Decided on July 07,1967

BHAVANI AMMA Respondents


- (1.) The appellant herein instituted the suit out of which this Second Appeal arises, for a declaration that the proceedings taken by her jointly along with the first defendant for recognition of an alleged assignment of the decree obtained by the appellant in O. S. 42/60 of the District Court, Kottayam against the third defendant, were the result of fraud and forgery and that the order passed by the executing court recognising the said assignment of the decree was not binding on the appellant plaintiff. She accordingly prayed for setting aside the said order and also for a permanent injunction restraining the first defendant and her advocate, the second defendant, from withdrawing from court certain amounts which were lying in deposit to the credit of the aforesaid decree. It was also contended as a ground for invalidating the assignment that the decree was one creating a charge over immovable properties exceeding Rs. 100/- in value and that no assignment of the said decree could be validly made except under a document duly registered under the Indian Registration Act. Reliance was placed in support of this proposition on S.17(1)(e) and S.49 or the Indian Registration Act. The Trial Court found against the plaintiff on the merits of all her allegations of fact relating to the alleged practice of forgery and fraud and held that the assignment was not vitiated by any such invalidating circumstances. It however, upheld the contention of the plaintiff that the assignment was bad for want of registration under S.17(1)(e) of the Indian Registration Act and that therefore, the first defendant had not validly acquired any rights whatever over the decree by virtue of the purported assignment. In this view, the Trial Court granted the plaintiff the declaration and injunction as prayed for by her. An objection raised by the defendant that the suit based on allegation of fraud was barred by limitation having been brought beyond the period of 3 years from the date of the order recognising the assignment was rejected by the Trial Court.
(2.) The first defendant filed an appeal against the aforesaid decision of the Trial Court. The plaintiff filed a memorandum of cross objections objecting to the Trial Court's finding that the assignment was not vitiated by fraud, forgery etc. The learned Additional District Judge confirmed the finding of the Trial Court that the plaintiff's case of forgery and fraud was not true and that there were no such circumstances; vitiating the assignment of the decree in favour of the first defendant. On the question relating to want of registration, the lower appellate court took the view that under S.49 of the Indian Registration Act the assignment would be inadmissible for want of registration only to the extent to which it purported to deal with rights in immovable property and that even without a registered instrument there can be a valid conveyance of the portion of the decree entitling the plaintiff to recover personally from the defendants the amount decreed. In other words, in the view of the learned District Judge, while the assignment would not operate to convey any rights to the first defendant to enforce the charge declared by the decree it would be perfectly valid and effective in so far as it related to that portion of the decree providing for the recovery of the suit amount from the judgment debtors personally. In this view, the lower appellate court held that the plaintiff was not entitled to the declaration or injunction prayed for by her and dismissed the suit.
(3.) The learned counsel for the appellant strenuously urged that the view taken by the lower appellate court regarding the effect of S.17(1)(e) and S.49 of the Indian Registration Act is incorrect and untenable. It is contended that since the decree admittedly declares and creates a charge on immovable property exceeding Rs. 100/- in value, no rights over such decree can be validly transferred except under an instrument in writing duly registered. In support of this contention reliance was placed on the decisions reported in Raychand Jivaji v. Badappa Virappa (AIR 1941 Bom. 71); Bank of Calcutta v. Dhirendra Nath ( AIR 1953 Cal. 325 ) and Narayana Kaimal v. Kumara Pillai ( ILR 1955 TC 77 ). On a reference to these decisions however, it is seen that they were all cases of mortgage decrees where the mortgage decree holder had in the first instance, necessarily to proceed only against the mortgaged property and it was only after exhausting his remedy by sale of the property that recourse could be had to personal execution against the judgment debtor. In such cases it cannot be doubted that no rights can be validly conveyed in the decree except by a registered instrument because the assignee should first be entitled to proceed against the immovable property in enforcement of the mortgage. Thus, these are cases where the personal decree did not coexist as enforceable simultaneously along with the portion of the decree entitling the decree holder to proceed against the property. This distinction is pointed out by the learned Judges of the Bombay High Court in Raychand Jivaji v. Basappa Virappa (AIR 1941 Bom. 71) at page 76 where it is observed that the position would only be different if the terms of the decree make it clear that the remedy of recovering the decretal amount from the property charged was not given in lieu of the personal remedy but in addition to it. In the case before the Bombay High Court it was held that the right to proceed against the judgment debtor personally was not independent of the charge but arose only, if at all, after the right to proceed against the charged property had been exercised and exhausted.;

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