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Peary Lal Vs. Allahabad Bank Ltd. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtAllahabad
Decided On
Reported inAIR1926All244
AppellantPeary Lal
RespondentAllahabad Bank Ltd.
Excerpt:
- - the question has arisen as to whether c's title is good or whether the transfer in c's favour is fictitious. in my opinion the case comes clearly within he purview of order 21, rule 51 of the civil p. 3. the witness that was examined on behalf of pearey lal stated that he had not seen baij nath at meerut since the sale deed was executed in favour of pearey lal and he was unable to say whether baij nath had left meerut for good or not......one ganeshi lal as defendant no. 1 and the allahabad bank ltd. as the defendant no. 2. the suit of baij nath and murli dhar was decreed for a sum of about rs. 8,000 against ganeshi lal, but was dismissed as against the bank. the bank was awarded costs to the amount of rs. 5-13-12. the decree was passed on the 27th of march 1923. on the 12th of may 1924 the allahabad bank applied for the attachment; of the decree obtained by baij nath and murli dhar against ganeshi lal in order to realize the money due to the bank. previous to this application for attachment, by a sale-deed, dated the 6th of february 1924, baij nath and murli dhar had sold the decree held by them against ganeshi lal to the appellant, pearey lal. ganeshi lal was declared an insolvent. peary lal, as a transferee of the.....
Judgment:

Mukerji, J.

1. This is an execution first appeal and has arisen under the following circumstances: A certain suit, No. 428 of 1922, was instituted by two persons Baij Nath and Murli Dhar against one Ganeshi Lal as Defendant No. 1 and the Allahabad Bank Ltd. as the Defendant No. 2. The suit of Baij Nath and Murli Dhar was decreed for a sum of about Rs. 8,000 against Ganeshi Lal, but was dismissed as against the Bank. The Bank was awarded costs to the amount of Rs. 5-13-12. The decree was passed on the 27th of March 1923. On the 12th of May 1924 the Allahabad Bank applied for the attachment; of the decree obtained by Baij Nath and Murli Dhar against Ganeshi Lal in order to realize the money due to the Bank. Previous to this application for attachment, by a sale-deed, dated the 6th of February 1924, Baij Nath and Murli Dhar had sold the decree held by them against Ganeshi Lal to the appellant, Pearey Lal. Ganeshi Lal was declared an insolvent. Peary Lal, as a transferee of the decree obtained by Baij Nath and Murli Dhar against Ganeshi Lal, got himself entered in the schedule of creditors. The Allahabad Bank had a debt payable by Ganeshi Lal which arose out of a different transaction and in that capacity the Bank was also entered in the schedule of creditors of Ganeshi Lal.

2. The Allahabad Bank in their application mentioned the fact that Baij Nath and Murli Dhar had sold their decree to Pearey Lal and that Pearey Lal had obtained an entry into the schedule of creditors of Ganeshi Lal. The Bank asserted that the transfer to Pearay Lal by Baij Nath and Murli Dhar was a fictitious one and prayed that the decree might be attached and the Insolvency Court might be requested to send the money that may be due on account of the decree of Baij Nath and Murli Dhar in Court for payment to the Bank.

3. Pearey Lal raised two objections: First, he said the question of title as between the Bank and Pearey Lal should be settled by the Insolvency Court; and secondly he said that he was a bona fide transferee for value and the decree was not attachable as the property of Baij Nath and Murli Dhar. The Court below has found both the points against Pearey Lal and hence the appeal.

4. A preliminary objection has been taken by Mr. Seth that the appeal is incompetent inasmuch as the objection of Pearey Lal was one that fell within the purview of Order 21, Rule 58 of the Civil P.C. and the order of the Court below was final subject to the result of any suit that Pearey Lal might bring to prove his title,

5. Dr. Katju maintained that the appeal was maintainable under Section 47 of the Civil P.C. and in case the Court should hold otherwise he requested that his appeal might be treated as a petition in revision.

6. On the question as to whether an appeal lies or not I am clear that no appeal lies, The position is this: A (the Bank) has obtained a decree against B (Baij Nath and Murli Dhar) for money. In execution of that decree A attaches a certain property (in this case a decree) belonging to B. Before the attachment C (Pearey Lal) has obtained a sale-deed in his favour in respect of the property attached. The question has arisen as to whether C's title is good or whether the transfer in C's favour is fictitious. The question has been raised by a person who is not a party to the decree. The question to be litigated is as to title to the property sought to be attached. In my opinion the case comes clearly within he purview of Order 21, Rule 51 of the Civil P. C, and the decision is final subject to the result of any suit that may be instituted. Dr. Katju's contention is that the property to be attached being a decree Pearey Lal, the moment he obtained an assignment of it in his favour, became a legal representative of the judgment-debtor and that, therefore, the case fell within the purview of Section 47 of the Civil P.C. He conceded that if the property attached had been anything but a decree Order 48, Rule 21 would have applied. I do not see how the case can come within the purview of Section 47 merely because the property to be attached happens to be a decree. Further, the question to be decided is not one relating to the execution, discharge or satisfaction of the decree. It is whether the sale-deed, on foot of which Peary Lal claims to be a representative, is a fictitious one or not. This question has nothing to do with the execution, discharge or satisfaction of the decree which was passed in favour of the Allahabad Back and against Baij Nath and Murli Dhar.

7. I hold that no appeal lies.

8. Considering the appeal as a petition in revision, I have to see whether the Court below had any jurisdiction or not to decide the question, that is to say, whether the Court below or the Insolvency Court should have decided the question whether the Allahabad Bank was entitled to attach the decree passed in favour of Baij Nath and Murli Dhar, in spite of the supposed transfer of it by the debtors in favour of Pearey Lal. Dr. Katju has pointed out Section 50 of the Provincial Insolvency Act as authorising the Insolvency Court to dispose of the question. That section simply says that in certain cases, at the instance of a Receiver or a creditor, the Insolvency Court may order the expungement of an alleged creditor's name from the schedule of the reduction of the amount of the debt due to him. But there is nothing in the section which says that any question of title raised between two scheduled creditors will be decided by the Insolvency Court. I hold that the Court below had the jurisdiction.

9. Such being my finding it is clear that I need not go into the merits of the appeal.

10. I have, however, heard Dr. Katju on the merits also and find myself in agreement with the finding of the Court below.

11. The Bank's case as made out in their petition of objection, dated the 29th of June 1925 (page 7 of the paper-book), was to the effect that the Bank's debtors had no means whatsoever, except the decree against Ganeshi Lal, by which to pay the debt due to the Bank: vide para. 3. The witness that was examined on behalf of Pearey Lal stated that he had not seen Baij Nath at Meerut since the sale deed was executed in favour of Pearey Lal and he was unable to say whether Baij Nath had left Meerut for good or not. Baij Nath executed the sale deed for himself and as an attorney for Murli Dhar. Evidently, therefore, Murli Dhar was not at Meerut. This circumstance must have weighed greatly with the Court below as it weighs with me. The debtors of the Bank have left the town having sold their valuable decree for Rs. 8,000 for the small sum of Rs. 300. Dr. Katju told me that the Receiver had declared a dividend of only Rs. 400 odd in favour of Pearey Lal. His argument is that this was the only sum recoverable under the decree of Baij Nath and Murli Dhar from the Insolvency Court. But I am not aware whether there are or not other assets of Ganeshi Lal to be realized. Some explanation ought to have been offered in the Court below as to why the valuable decree for Rs. 8,000 was sold almost for a song. I agree with the Court below that the transfer in favour of Pearey Lal was fictitious one.

12. The appeal fails on each and every point, and it is hereby dismissed with costs which will include counsel's fees in this Court on the higher scale.


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