1. In order to appreciate the controversy in this case, it would be helpful to give some of the dates. On 24th August, 1948, Banarsi Dass, plaintiff-respondent, obtained a decree for a sum of Rs. 2,580/- with costs and future interest at the rate of Re. 1/- per cent per mensem till realisation against Sadhu Singh, defendant-respondent No. 2. On 21st August 1951, execution of this decree was sued out but the same was consigned to the record room on 15th March, 1952. On 19th August, 1952, a pronote appears to have been executed by Sadhu Singh in favour of one Sardar Sarup Singh for a sum of Rs. 2,000/-. In this promissory note, it is stated that the amount has been taken for payment of debt and that the loan is to bear interest at the rate of Re. 1/- per cent per mensem.
On 20th July, 1954, second execution application was filed by Banarsi Dass and land belonging to the judgment-debtor was sought to be attached. Fard of this land was furnished to the Court on 29th October, 1954. On 25th July, 1955, the decree-holder applied to the Court for attachment of the land in question after preserving the mortgage for Rs. 3,000/-, which Sadhu Singh appeared to have effected in favour of his brother, Bachan Singh. On the same day, namely the 25th of July, 1955, on an objection having been raised by the judgment-debtor, the execution application was dismissed on the ground that the decree-holder had not been able to point out the land sought to be attached.
On 2nd August, 1955, the decree-holder presented another execution application and prayed for attachment of the land belonging to the judgment debtor. This petition was returned by the Court, in which it was filed, for presentation to proper Court, as the Subordinate Judge concerned was found to have no jurisdiction. The execution application was then presented to the Court having jurisdiction on 5th August, 1955. On the following day, i.e., the 6th of August, 1955, attachment of the land in question was ordered and necessary warrants were directed to be issued.
On the same day, i.e., the 6th of August, 1955V 52 bighas and 8 biswas of land, being half of the land measuring 104 bighas and 15 biswas, as per fard numberwar attached with the sale deed, were sold by Sadhu Singh, judgment-debtor, in favour of Bachan Singh, his real brother, for an ostensible consideration of Rs. 6,000/-, A sum of Rs. 3,000/-out of the sale money was adjusted towards the mortgage amount due to, Bachan Singh vendee; a sum of Rs. 200/- was alleged to have been received for meeting registration expenses and the balance amounting to Rs. 2,800/- were received before the Sub-Registrar on the same day.
It may be noticed that this document was presented to the Sub-Registrar on the date of its execution between 9 a.m. and 10 a.m. on 8th August, 1955, Sadhu Singh appeared in the executing Court and objected that execution application dated the5th of August, 1955, was barred by time. Oneday later, i.e., on 9th of August, 1955, Sadhu Singh is alleged to have paid Rs. 2,500/- to Sarup Singh allegedly on account of the promissory note on 19th August, 1952.
On 29th August, 1955, Banarsi Dass filed an appeal to the Court of the District Judge against the order of the executing Court dated the 25th of July, 1955, whereby the execution application had been dismissed On the ground that the decrea-holder had failed to furnish, nishandehi. This appeal was allowed on 21st November, 1955, and theorder of the executing Court dated the 25th of July, 1955, set aside.
2. On 28th November, 1955, the third execution application, which had been filed on 5th August, 1955, was consigned to the record room, because the earlier execution application, which had been dismissed on 25th of July, 1955, was revived as a result of the appellate order dated the 21st November, 1955. On 1st December, 1955, Sadhu Singh raised an objection in the executing Court questioning its jurisdiction. On 5th March,1956, the executing Court ordered warrants of attachment to issue and in pursuance thereof the land in question was actually attached on 15th March, 1956. On 29th March, 1956, Bachan Singh appeared on the scene and raised objections to the attachment of the land under Order 21, Rule 58, Civil Procedure Code, claiming title to the attached property as a vendee under the sale deed dated the 6th of August, 1955.
On 2nd April, 1956, the objections, raised bySadhu Singh on the 1st of December, 1955, questioning the jurisdiction of the execution Court, were rejected. On 15th July, 1956, the executing Courtalso ruled out the judgment-debtor's objection relating to the executability of the decree. The judgment-debtor went up in appeal against this order, which was dismissed on 21st November, 1956. A further appeal to the High Court against this order was also dismissed though the learned counsel for the appellant could not give the exact date.
The order, dated the 2nd of April, 1956, whereby objection to the jurisdiction of the executing Court had been ruled out was affirmed on appeal by the District Judge on 6th December, 1956. On 21st January, 1957, Bachan Singh's objections under Order 21, Rule 58, C. P. C., were allowed and the land released. Feeling aggrieved by thisorder, Banarsi Dass instituted the present suit on 23rd of July, 1957, for the usual declaration, which was decreed, and it is against this judgment and decree that Bachan Singh has preferred the present appeal. The parties went to trial Court on the following two issues:-
(I) Whether Sadhu Singh sold his land on 6th August, 1955, in a fictitious manner in ordei to defeat the debt of the plaintiff, and
(2) Whether the suit is within time. Both of these were decided in favour of the plaintiff and his suit decreed. The Court below came, inter alia, to the conclusion that the vendor and the vendee had the knowledge about the plaintiff's debt; that the sale was effected after the plaintiff had started execution proceedings; and that the defendant had alienated his entire and withoutmaking any provision in the sale deed for the discharge of the plaintiff's debt. On the basis oi these conclusions and in the background of the narrative given above, the Court below held that Sadhu Singh had sold his land on 6th August, 1955, in a fictitious manner in order to defeat and delay his creditors i.e., the plaintiffs. The issue with respect to limitation was, of course, decided in favour of the plaintiff and this part of the decision is not assailed before us on behalf of the appellant.
3. Mr. L. D. Kaushal, the learned counsel for Bachan Singh, has, after giving the above narrative, submitted that the mortgage of 52 bighas and 8 biswas of land effected by Sadhu Singh in favour of Bachan Singh having been admitted by Banarsi Dass on 25th of July, 1955, the sale held on the 6th of August, 1955, in favour of Bachan Singh must be considered to be a genuine and a bona fide transaction and that the Court below has acted on conjectures and surmises in holding the same to be fictitious and intended to defeat and delay, Sadhu Singh's creditors.
4. In my opinion, the contention advanced by the learned counsel is wholly devoid of merit and is difficult to sustain. In so far as the mortgage is concerned, it is true that on 25th of July, 1955, Banarsi Dass did ask for attachment of Sadhu Singh's land after preserving the mortgage, but Bachan Singh has not cared to adduce any evidence about the date and the terms of this mortgage and, indeed, even his learned counsel in this Court was unable to give us any more information than what is deductible from the fact that Banarsi Dass had actually claimed attachment of the immovable property after preserving the mortgage debt.
It is common ground that Bachan Singh and Sadhu Singh are shown as joint owners in the revenue papers. In so far as the promissory note dated the 19th of August, 1952, is concerned, it is significant that Sarup Singh, the alleged creditor, has not been produced as a witness. In the promissory note, it is stated that the loan of Rs. 2,000/- was being taken for payment of debts, but, curiously enough, there is no material on the present record showing the existence of any such debts, nor is there any evidence as to whether or not the sum alleged to have been obtained from Sarup Singh was ever utilised for such a purpose. It is correct that on the back of the pronote two payments seem to have been entered, but then again in the absence of Sarup Singh's testimony, it is difficult to hold that these entries represent any genuine payments.
As a matter of fact, even the scribe of this pronote has not been produced, On behalf of the appellant, stress has been laid on the testimony of Sawan Singh, D. W. 4, a cultivator, and of Gurdial Singh, D. W. 5, another cultivator, who have deposed about the execution of the promissory note and about Sadhu Singh's having borrowed a sum of Rs. 2,000/- from Sarup Singh. In my opinion, the non-production of the best evidence, namely of Sarup Singh, must give rise to a presumption against the defendants. It is also noteworthy that in the sale deed, although it is stated that the vendor owed debts and that the creditors were making demands, there is no reference to any individual creditor except that a sum of Rs. 3,000/- is stated to havebeen adjusted in the mortgage account with Bachan Singh. Banarsi Dass, the present decree-holder, does not figure anywhere in the sale deed nor is there any reference to Samp Singh, who, as the learned counsel for the appellant would have us believe, was paid on the 9th of August, 1955, a sum of Rs. 2,500/-.
But this apart, although the sale was effected on the 6th of August, 1.955, it is clear from the history of the execution proceedings, as given to us on behalf of the appellant, that Sadhu Singh continued to resist the execution application on various grounds and Bachan Singh did not choose to come on the scene before 29th of March, 1956. But then Mr. L. D. Kaushal contends that Bachan Singh cannot be made to suffer, because of Sadhu Singh's activities and that as soon as the land sold to Bachan Singh was attached, he immediately approached the Court and lodged the objections.
It is true that Bachan Singh came on the scene within a fortnight of the actual attachment of the land, but it is not easy to believe that his brother Sadhu Singh should, on the facts and circumstances of the present case, be considered to have played a fraud on him and kept in the dark about the execution proceedings, which were only concerned with the realisation of the decretal amount from Sadhu Singh's half share in the joint land amounting to 104 Bighas and 15 biswas, the fard number-war of which was admittedly attached with the sale deed.
The entire conduct of the two brothers and the history of the execution leaves no reasonable doubt that Bachan Singh and Sadhu Singh, who are not shown to be inimical towards each other, were actually acting in collusion with the object of delaying, if not also defeating Banarsi Dass, decree-holder. There is also nothing on the present record showing if Bachan Singh took any steps to have the revenue entries made in his favour in pursuance of the registered sale-deed dated 6-8-1955, aS a matter of fact, according to Exhibit P. w. 2/N-dated the 15th of June, 1956, which is an extract from the proceedings register maintained by the Panchayat of village Dakala, it is apparent that till then Bachan Singh was entered as a mortgagee of half the land belonging to Sadhu Singh in lieu of Rs. 3,000/- without a share in the shamilat. The complete lack of material with respect to the date and the other particulars of the alleged mortgage in favour of Bachan Singh leaves this Court in serious doubt as to whether it is safe to assume that it was an honest, straightforward and bona fide transaction.
5. It is perfectly correct, as contended by the appellant, that, however, suspicious a transaction, the Court's decision must always be based, on legal grounds, legally brought on the record, and it must never rest on suspicions or on the Courts' mere moral convictions; and the burden of successfully assailing the transaction also initially lies on the creditors. It is, however, equally settled that when the Creditors have established facts which show the prima facie Intention of the debtor to defeat or delay the creditors, It is then for the debtor to meet the case made out and to explain the facts.
In this connection, it has to be borne in mind, that, according to general law, a man is presumedto intend the natural consequences of his acts, a further, that, fraud, from its very nature, has necessarily to be established by circumstantial evidence. The facts, which militate against the bona fides of a transaction and whose cumulative effect establishes fraud, are many and varied, and unexplained secrecy is, by and large, considered to be a badge of fraud, whereas notoriety might well rebut a presumption of fraud. Though all facts are to be considered cumulatively, yet the facts that the debtor-transferee (transferor?) is in embarrassed circumstances (proceedings for attachment of his property having been initiated) and the transaction is between close relations, who are otherwise not shown to be inimical to each other, may constitute good prima facie evidence of fraudulent intention; this would he still more so, when the entire property has been transferred by the debtor and no reliable evidence of the bona fides of the transferee has been placed on the record.
The subsequent conduct of the vendee in not taking necessary steps for getting the requisite mutations entered in the revenue papers, in this State, is also not wholly unimportant in determining the, fraudulent intent and the existence of Collusion between the two brothers. A transaction, which does, in fact, result in defeating and delaying the existing creditors may legitimately be presumed to have been made with the intention of causing the above consequence, and this rule would perhaps be equally applicable even when there is only a single Creditor to the debtor and he has been so defeated and delayed.
6. In the instant case, it was only in 1955 that the mortgage in question become discernible so far as the existing record goes. Now if this mortgage came into existence subsequent to the passing of the decree in August, 1948, then it can, with a fair amount of plausibility, be urged to be a step in the attempt on the part of Sadhu Singh and Bachan Singh to defeat and delay Banarsi Dass. But be that as it may, on the present record, I find it exceedingly difficult to hold that the impugned sale dated the 6th of August, 1955, was a bona fide transaction between the two brothers and was not intended to defeat and delay Sadhu Singh's creditors.
It is admitted that Sadhu Singh does not own any other property and if this sale is upheld, then obviously the decree-holder cannot realise his decretal amount within foreseeable future and indeed this was not seriously controverted by the appellant. The findings and conclusions of the Court below appear to be fully justified on the evidence and the circumstances taken as a whole and the learned counsel for the appellant has not been able successfully to assail them.
7. For the reasons given above this appeal fails and is hereby dismissed with costs.
D.K. Mahajan, J.
8. I agree.