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Lochan Singh and ors. Vs. Mauji Ram and ors. - Court Judgment

LegalCrystal Citation
Subject Civil
CourtAllahabad
Decided On
Reported inAIR1945All154
AppellantLochan Singh and ors.
RespondentMauji Ram and ors.
Excerpt:
.....on his behalf between the day on which the first chapter of this act conies into force and the day on which he applies under section 4, not being a transfer made before and in consideration of marriage or made in favour of a purchaser or encumbrancer in good faith and for valuable consideration, may be annulled at the instance of any creditor if the special judge finds that such transfer was made with a view to deprive the landlord's creditors of their rights under this act. as regards the finding of the learned special judge in this case that the deed of endowment was only a fictitious transaction intended to defeat the applicants' creditors, we need only say that the learned special judge has given very good reasons for arriving at that conclusion......application. the court then issued a notice under section 11 of the act which provides thatthe special judge shall publish a notice in the manner specified in section 9 specifying the property mentioned by the applicant under section 8 or by any claimant under section 10.there was, however, a mistake made in the issuing of this notice, inasmuch as the only property specified therein was the property mentioned by the applicants in their written statement under section 8. there was no mention of the property to which the objection raised by the respondent mauji ram related. it is really upon this omission that the whole appeal rests. in answer to the objection raised by mauji ram the applicants alleged that the properties to which the objection related were endowed properties and in.....
Judgment:

Mulla, J.

1. This is an appeal under Section 45, Encumbered Estates Act, arising out of an application made under Section 4 of that Act by the present appellants on 9th September 1935. The application was followed in due course on 15th May 1936, by a written statement under Section 8. The only property mentioned in the application as well as the written statement was 642 bighas odd out of 706 bighas odd in Mauza Himmatpur, Mahal Thakur Tikam Singh, Khewat No. 1. Several creditors were named in the application and one of them, namely, Mauji Ram, respondent 1 in this appeal, filed a claim under Section 10 (1) of the Act in which he alleged that four groves, three houses and a small revenue free grant had not been mentioned by the applicants in their application. The Court then issued a notice under Section 11 of the Act which provides that

the Special Judge shall publish a notice in the manner specified in Section 9 specifying the property mentioned by the applicant under Section 8 or by any claimant under Section 10.

There was, however, a mistake made in the issuing of this notice, inasmuch as the only property specified therein was the property mentioned by the applicants in their written statement under Section 8. There was no mention of the property to which the objection raised by the respondent Mauji Ram related. It is really upon this omission that the whole appeal rests. In answer to the objection raised by Mauji Ram the applicants alleged that the properties to which the objection related were endowed properties and in support of that allegation they produced a deed of endowment, dated 15th March 1929. From this deed, which is on the record, it would appear that it was executed by only one of the applicants, namely, Thakur Lochan Singh. He was apparently the senior-most member of the joint family of the applicants. He had obviously no authority to execute the deed of endowment all by himself, but it was alleged in the deed that he had done so in consultation with his relations. Under this deed Raghuraj Singh, another applicant and the son of Lochan Singh, was appointed as the first mutwalli of the property in question which was dedicated to a private idol installed in a house belonging to the joint family. It was further provided that upon the death of Raghuraj Singh the ablest member of the family will succeed to him as mutwalli of the endowment. It is an admitted fact that at the date of the execution of this deed the applicants were subject to many debts several of which had resulted in decrees against them. The learned Special Judge framed an issue on this point and decided that the property covered by the deed of endowment was still the property of the applicants and was liable to be attached and sold in satisfaction of their debts because the deed of endowment was only a device adopted by the applicants in order to defeat their creditors. It is against this finding of the learned Special Judge that the appeal is directed.

2. The foundation of the argument advanced on behalf of the appellants by Dr. Asthana is the omission in the notice under Section 11 to which reference has been made above. It is contended that under Section 11 the Special Judge is entitled only to deal with properties which have been specified under Sub-section (1) of that section and with no others. Section 11 runs as follows:

(1) The Special Judge shall publish a notice in the manner specified in Section 9 specifying the property mentioned by the applicant under Section 8 or by any claimant under Section 10.

(2) Any person having any claim to the property mentioned in such notice shall, within a period of three months from the date of the publication of the notice in the Official Gazette, make an application to the Special Judge stating his claim and the Special Judge shall determine whether the property specified in the claim, or any part thereof, is liable to attachment, sale or mortgage in satisfaction of the debts of the applicant....

3. Upon a consideration of the wording of Section 11, we find that it is wide enough to give the Special Judge power to investigate a claim made in respect of a property which has ostensibly been transferred by the applicant. It is open to the claimant-objector to plead that the title to the property, which is the subject of the ostensible transfer, still remains with the applicant and it is, therefore, liable to be seized in satisfaction of the applicant's debts. This question can be considered by the Special Judge and in determining that question he will have to hold, if necessary, upon the evidence that a certain transfer by the applicant is really a fictitious transaction which does not have the effect of passing away from him the title to the property in question. The technical argument raised on behalf of the appellants that any defect or omission in the notice contemplated by Sub-section (1) of Section 11 curtails the power of the Special Judge is, in our judgment, not tenable. It is, however, argued that Section 12 which follows Section 11 has that effect inasmuch as it lays down that

any transfer of property made by a landlord or other person acting on his behalf between the day on which the first chapter of this Act conies into force and the day on which he applies under Section 4, not being a transfer made before and in consideration of marriage or made in favour of a purchaser or encumbrancer in good faith and for valuable consideration, may be annulled at the instance of any creditor if the Special Judge finds that such transfer was made with a view to deprive the landlord's creditors of their rights under this Act.

It is strenuously contended by Dr. Asthana that the only transfers which a Special Judge acting under the Encumbered Estates Act can set aside are the transfers referred to in Section 12. (We are unable to accept this contention. We find nothing in the language of Section 12 from which we could infer that it restricts or curtails in any way the wide and general power of determination which is conferred upon the Special Judge by Section 11 which has been cited above. It may be that Section 12 was not really necessary in view of the wide power given by Section 11. Under Section 11 it is incumbent upon the Special Judge to determine whether a certain property can or cannot be attached or sold in satisfaction of the debts of the applicant and for that purpose it is necessary to decide whether the title to any property does or does not remain with the applicant. If there has been a collusive or fictitious transfer which does not have the effect of passing the title to the property from the applicant to a third person, it is the duty of the Court, if it has evidence before itself, to decide that question. That power is not, in our judgment, in any sense governed by the provisions of Section 12. Lastly, it was argued that under Section 19, Sub-section (2) of the Act it was not within the power of the Special Judge to inform the Collector about any property except that mentioned in the notice issued under s.1l. Sub-section (2) provides that 'the Special Judge shall inform the Collector of the nature and extent of the property mentioned in the notice under Section 11 which he has found to be liable to attachment, sale or mortgage in satisfaction of the debts of the applicant.' In the present case the Special Judge has definitely found that the property covered by the deed of endowment set up by the applicants was liable to be seized in satisfaction of the debts of the applicants. The objection, however, is that as this property was not mentioned in the notice issued under Section 11 the Special Judge has no power to specify this property in the information given by him to the Collector. We are again unable to accept this argument, because in our judgment the sub-section only casts a duty upon the Special Judge to convey some necessary information to the Collector; in respect of the properties which the Special Judge holds are liable to be attached and to be seized and sold in satisfaction of the applicant's debts. It does not contain any prohibition that the Special Judge shall not mention any property which is not referred to in the notice under Section 11, even though it is definitely found upon an issue raised between the parties before him that the property is liable to be seized in satisfaction of the applicant's debts. As regards the finding of the learned Special Judge in this case that the deed of endowment was only a fictitious transaction intended to defeat the applicants' creditors, we need only say that the learned Special Judge has given very good reasons for arriving at that conclusion. Dr. Asthana was not able to satisfy us that those reasons could really be challenged upon the evidence, as it stands. In our judgment the utmost that can be urged on behalf of the appellants is that in consequence of the defect in the notice under Section 11 the idol to whom the property in question was dedicated by the deed of endowment, dated 15th March 1929, will not be bound by the decree passed by the Special Judge in this proceeding under the Encumbered Estates Act. That may be so, but it will only leave the idol to pursue the proper remedy in a suit if it is so advised to do. The result, therefore, is that we dismiss this appeal with costs.


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