SUSHILABEN WIFE OF DHIRUBHAI BHOGILAL GANDHI Vs. ANANDILAL BAPALAL

JUDGEMENT

(1.) Original defendants Nos. 2 to 6 of Civil Suit No. 3646 of 1973 On the file of City Civil Court Ahmedabad being aggrieved by the judgment and decree of the learned City Civil Judge holding that the release deed dated 11/02/1972 executed by original defendant No. 7 in their favour amounted to fraudulent transfer within the terms of sec. 53 of the Transfer of Property Act inasmuch as it was executed with the ulterior motive to defeat and delay the creditors plaintiffs Nos. 1 to 5 whose suits were pending at the relevant time of the execution of the said deed and in which ultimately decrees were made in their favour against him have filed first Appeal No. 50/79 and original defendant No. 1 has filed First Appeal No. 587/79.

(2.) . It is not necessary to set out elaborately the minutest facts leading to these appeals. Suffice it to state a few facts in order to appreciate the contentions urged on behalf of the appellants in these appeals. It should be stated that First Appeal No. 587/79 is an appeal preferred by original defendant No. 1 of the said suit against the same judgment and decree which is the subject matter of First Appeal No. 50/79. Since the contentions urged are more or less similar in both these appeals which arise out of the same suit and directed against the same judgment and decree of the City Civil Court we intend to dispose of these two appeals by this common judgment. We will refer to the appellants as well the Respondents of both these appeals by reference to their original position in the suit.

(3.) . Defendant No. 2 is the wife of the first defendant while defendants Nos. 3 to 6 are their sons. The plaintiffs who are the respondents Nos. 1 to 5 in both these appeals are the creditors and they filed three suits in the City Civil Court. Respondent Nos. 3 4 and 5 were the plaintiffs of Summary Suit No. 501/71 respondent No. 2 was the plaintiff of Summary Suit No. 502/71 and respondent No. 1 was the plaintiff of Summary Suit No. 503/71 on the file of the City Civil Court Ahmedabad. The amounts for which decrees were prayed in the said suits were respectively (i) Rs. 21375.00 (ii) Rs. 12750.00 and (iii) Rs. 35655.00. Respondent No. 6 herein was also a creditor of the first defendant which was permitted to be shown as plaintiff No. 6 in the suit out of which these appeals arise. It is claimed by these plaintiff respondents Nos. 1 to 5 herein that the first defendant was doing business in partnership in the name and style of Asian Enterprises. The said defendant had for the purposes of the business it is claimed borrowed various amounts from the plaintiffs. It is claimed by the respondent plaintiffs Nos. 3 4 and 5 that the first defendant had borrowed in all a sum of Rs. 15 0 in 1967. Similarly defendant No. 1 had borrowed from the respondent plaintiff No. 2/06/1968 a sum of Rs. 10 0 He had also borrowed from respondent plaintiff No. 1 between May and July 1967 a total sum of Rs. 25,000 The first defendant had agreed to pay interest at the rate of 15% on all these borrowings and accordingly the interest was paid by the said firm in which the first defendant was a partner. Accoringly interest was paid to respondent plaintiffs Nos. 3 4 and 5 for a period upto 30/04/1968 and to plaintiffs Nos. 1 and 2 for a period upto 30/04/1969 Since the said firm closed down its business the plaintiffs by their notices of 25/03/1971 called upon the original defendant No. 1 as well as his firm to arrange to pay the amounts found due at the foot of the accounts of the said firm. Notices were served on the firm as well as the partners including the first defendant who failed to give any reply to the said notice while the other partners gave evasive replies but neither the first defendant nor his firm nor the other partners complied with the demand made in the notice with the result that three suits as aforesaid were required to be filed in the City Civil Court Ahmedabad on 2/03/1971 It is common ground that the first defendant had executed a release deed on 11/02/1972 in favour of original defendants Nos. 2 to 6 relinquishing all his right title and interest in the immovable property standing on the land admeasuring 98 sq. yards of 5. Nos. 876 877 878 and 4358/8 situate within ward No. 2 Dariapur in the city of Ahmedabad and bearing municipal census Nos. 551 and 552 for a consideration of Rs. 20,000 being the value of his 1 share in the joint family comprising of himself his sons and wife who had 1/2 share in the said property The other 1/2 share was of the brother of original defendant No. 1. Respondent plaintiffs Nos. 1 to 5 were therefore required to seek a declaration by filing the present suit that the said release deed amounted to fraudulent transfer within the terms of sec. 53 of the Transfer of Property Act inasmuch as it was executed with the ulterior motive to defeat and delay the creditors and particularly because at the relevant time of the execution of the said deed not only the original defendant No. 1 was heavily indebted to the other creditors but also because the pendency of the suits of the respondents. It is claimed by the present respondent plaintiffs that the original defendants Nos. 2 to 6 were members of the coparcenary and therefore their shares in the suit property were also liable for the satisfaction of the debts owed by the first defendant and therefore if the first defendant had created or brought about a bogus and a fraudulent release deed it is essentially with a view to avoid and defeat the creditors by creating a facade of the relinquishment of the share and interest of the first defendant. The respondents plaintiffs further claimed that since the first defendant was the Manager and Karta of his joint Hindu family comprising of himself his wife and sons the debts owed by him which were antecedent in point of fact and in point of time and being prepartition debts the suit property which is the subject matter of the said deed of release is liable for the satisfaction of the debts on the principle of pious obligation of the sons to pay the debts of his father. The respondent plaintiffs Nos. 1 to 5 therefore prayed that it be declared that the impugned release deed was executed fraudulently and illegally with the ulterior motive of defeating and delaying the creditors and therefore not binding to the plaintiffs as well as the other creditors and the entire share and interest of the joint family property of the first defendant his wife and sons in the said property was liable fOr the debts of the first defendant and in the alternative they prayed for a declaration that the right title and interest of original defendants Nos. 2 to 6 were liable for the debts of original defendant No. 1 as they were antecedent in point of time and fact and the said defendants were all liable to satisfy the said debts.