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Kr. Aittar Singh Vs. Mahabir Pal Singh and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtAllahabad
Decided On
Reported inAIR1944All213
AppellantKr. Aittar Singh
RespondentMahabir Pal Singh and ors.
Excerpt:
- - on principle as well as on the plain meaning of the term 'contract,'we think, that a gift cannot be included among the transactions which operate to transfer the liability for the repayment of an advance within the terms of the definition......a contract and that the words we have quoted from the definition of a loan could not apply to any transfer of property, but only to the transfer of a personal liability. we are not aware, however, of any way in which a personal liability could be transferred by a sale in execution of a decree, and we, therefore, conclude that the term 'contract' was not used in a strictly technical sense by the legislature. it seems to us that the legislature in using the term 'contract' meant to include transfers or conveyances which at some stage or other involved a contract between the parties. a contract,' however, must be for consideration. however we stretch the meaning of the term 'contract,' we cannot include within that meaning any transfer which does not involve the payment of consideration......
Judgment:

Allsop, J.

1. The appellant executed a deed of mortgage in the year 1922. Thereafter in the year 1929, he made a gift of part of the mortgaged property to his wife, Mt. Mahrani. This lady died two or three years later and then an entry was made in the register of proprietors that the judgment-debtor's second wife, Mt. Raj Koeri was in possession, although it is not contended that any transfer was ever made in her favour. On the death of Mt. Mahrani Kuer the judgment-debtor again inherited the gifted property.

2. A suit was instituted against him and Mt. Raj Koeri in the year 1934 for sale of the property on the basis of the mortgage and a decree was passed to that effect. Most of the mortgaged property had been transferred to third parties and that property has already been sold in execution of the decree. There remained only the property which had been gifted to Mt. Mahrani Kuer and which had reverted to the judgment-debtor. When the decree-holder sought to put this property to sale in execution of the mortgaged decree, the judgment-debtor raised the plea that he was protected under Section 17, U.P. Debt Redemption Act, 1940. There seems to have been no contest upon the question whether the judgment-debtor paid less than Rs. 25 a year as local rate.

3. The learned Judge of the Court below, however, rejected his plea that he was protected under the Act because of the transfer made in favour of Mt. Mahrani Kuer.

4. The argument is based on the definition of the term 'loan' in Section 2, Sub-section (9) of the Act. By this definition 'a loan does not include an advance the liability for the repayment of which has, by a contract with the borrower or his heir or successor or by sale in execution of a decree, been transferred to another person.' The argument is that the liability was transferred to Mt. Mahrani Kuer and now that it has been re-transferred to the judgment-debtor he is still excluded from the benefit of Section 17 of the Act.

5. It may be argued that a conveyance of property is not a contract and that the words we have quoted from the definition of a loan could not apply to any transfer of property, but only to the transfer of a personal liability. We are not aware, however, of any way in which a personal liability could be transferred by a sale in execution of a decree, and we, therefore, conclude that the term 'contract' was not used in a strictly technical sense by the Legislature. It seems to us that the Legislature in using the term 'contract' meant to include transfers or conveyances which at some stage or other involved a contract between the parties. A contract,' however, must be for consideration. However we stretch the meaning of the term 'contract,' we cannot include within that meaning any transfer which does not involve the payment of consideration. We conclude, therefore, that a transfer by means of a gift cannot be a transfer by which the liability of the borrower is transferred to another person within the meaning of Section 2(9) of the Act. It seems to us that this interpretation is also in all probability, in accordance with the principle underlying the provisions which we have quoted.

6. It seems to us that the intention of the Legislature was to prevent a person securing a benefit which he had not deserved. Any person who accepted a transfer of property for consideration with the knowledge that there was a charge upon it would make allowance for the payment of that charge when he fixed the price which he was willing to pay. Having obtained the property at a lower price because it was subject to a charge, there would be no reason why he should benefit by being allowed to repudiate the charge. He should not be allowed a benefit in two ways. On principle as well as on the plain meaning of the term 'contract,' we think, that a gift cannot be included among the transactions which operate to transfer the liability for the repayment of an advance within the terms of the definition. That being so, the judgment-debtor is entitled to claim the advantage of the provisions of Section 17 of the Act.

7. The result is that we set aside the order of the learned Judge of the Court below and direct that the property shall not be sold in execution of the decree.

8. The case will go back to the Court below for decision upon the question whether any mortgage should be executed in accordance with the provisions of Section 17 of the Act.

9. The appellant will get his costs of this appeal.


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