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Hota Veerabadhrayya and anr. Vs. Bolla Bulli Subbarayudu and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Reported inAIR1942Mad650; (1942)2MLJ94
AppellantHota Veerabadhrayya and anr.
RespondentBolla Bulli Subbarayudu and ors.
Cases Referred and G. D. John v. Sombamurthi Ayyar
Excerpt:
- - although the transfer of property act is not specifically referred to in that judgment this principle seems clearly to follow from a judgment of the privy council reported in muhammad siddiq khan v. for these reasons i hold that the obligation in question in this case was a debt attachable in 1935 and these appeals must therefore fail......if it is an obligation already in existence. it is argued for the appellants that there was no debt or obligation in existence at any time before 1937, but it seems clear to me that the obligation to pay for the property purchased sprang into-being by virtue of the very transaction of sale itself in 1929. the right which is given to the vendee by section 55 (5) (b) is not a right to say that he is under no obligation, but a right to postpone the discharge of that obligation. the cases cited for the appellants, viz., haridas acharjia chowdhry v. baroda kishore acharjia chowdhry i.l.r.(1899) cal. 38 lachman v. jarbhandan i.l.r.(1927) all. 507 and g. d. john v. sombamurthi ayyar (1928) 56 m.l.j. 299 are clear cases in which an obligation is not yet due, and easily therefore.....
Judgment:

King, J.

1. The ultimate transaction which has given rise to these appeals is the sale by defendants 2 to 4 of certain properties to defendant 1 in December, 1929. The consideration of Rs. 2,500 was by the terms of the sale-deed retained in the hands of defendant 1 for the purpose of discharging two debts due to plaintiff; one on a first mortgage and the other on a promissory note. The property sold was subject also to a second and a third mortgage. These mortgages the Vendors undertook to discharge.

2. Defendant 1 did not discharge the promissory note debt and plaintiff accordingly sued in 1931 to recover it and obtained decree against defendants 2 to 4. In execution of that decree he attached the debt which he alleged to be due from defendant 1 to defendants 2 to 4 as unpaid purchase-money in respect of the sale. On notice being sent to defendant 1, he denied that any debt was due, con-1 ending that he was under no liability to pay the purchase-money until defendants 2 to 4 had cleared off the second and third, mortgages. The executing Court accepting this contention raised the attachment on 1st August, 1935. Plaintiff thereupon filed the present suit (O.S. No. 188 of 1936) under Order 21, Rule 63 impleading all four defendants. The suit was dismissed by the learned District Munsif of Razole.

3. Meanwhile in August, 1936, defendants 2 to 4 transferred to defendant 5, their right to receive from defendant 1 the unpaid purchase-money. Defendant 5 in 1937 paid off the second and third mortgages, and then in O.S. No. 23 of 1938, sued defendant 1 for the money, and. obtained a decree. The decree, however, did not award him interest from the date of the sale transaction. Against this part of the decree defendant 5 appealed and this appeal (A.S. No. 4811940), was heard recently by me sitting with Lakshmana Rao,. J. We confirmed, the decree refusing interest for the whole period until defendant 5 paid off the two mortgages, holding that under Section 55 (5) (b) of the Transfer of Property Act, defendant 1 was entitled to retain the purchase-money in his hands.

4. Plaintiff appealed against the decree of the District Munsif in the present suit. Defendant 5 was impleaded as supplemental respondent. The appeal was allowed. Defendant 5 and defendant I have separately filed the two second appeals which I have now heard.

5. The first point taken for the appellants is that plaintiff's suit was not maintainable. It is argued on the authority of Butchayya v. Krishnamachari : AIR1936Mad152 , that when a garnishee denies his liability to the judgment-debtor the question between him and the decree-holder is one which is outside the scope of Order 21, Rules 58 to 63, altogether. It is clear, however, that Butchayya v. Krishnamacharij : AIR1936Mad152 , does not go so far as this, and recognises that where the 'existence of the debt' is admitted by the garnishee these rules apply. The expression 'existence of the debt' is ambiguous but I think it must be interpreted to mean 'existence of facts from a consideration of which it follows in law that the garnishee is indebted'. Here defendant 1 admitted that he had purchased the property and had not paid for it, and in essence claimed only that he was entitled not to refuse payment altogether but only to defer it. I would accordingly hold that plaintiff's suit does lie.

6. The question then arises whether in 1935 at the time of the order raising the attachment, defendant 1 was under any immediate obligation to his vendors. The argument for plaintiff is that even though a Bench of this Court may have held that defendant 1 was entitled to retain the purchase-money in his hands this privilege was coupled with a corresponding duty under Section 55 (5) (b) to pay it to the mortgagees. As he had not fulfilled this duty for nearly six years, the right of his vendors to receive the purchase-money had been restored. In support of this argument I have been referred to Baghunalha v. Sadagopa : (1911)21MLJ983 , and Komukutti v. Kumara Menon : (1918)35MLJ692 , but these are cases which have nothing to do with Section 55 (5) (ft). They merely lay it down that where a vendee has undertaken to discharge his vendor's debts to simple money creditors and fails to do so within a reasonable time the vendor may sue the vendee directly for the money.

7. The learned advocates for the appellants do not deny that under Section 55 (5) (b), it is the duty of the vendee to pay the money which he retains in his hands to the mortgagees, but they argue that this obligation cannot arise if the sum required to pay off the mortgagees is greater than the amount of the purchase-money. Although the Transfer of Property Act is not specifically referred to in that judgment this principle seems clearly to follow from a judgment of the Privy Council reported in Muhammad Siddiq Khan v. Nasir Ullah Khan . It is there explicitly laid down that a vendee charged with the obligation of paying off an encumbrancer to a certain extent may defer doing so until the vendor is prepared to contribute the remainder of the sum due to pay him off completely. In 1935, therefore defendant 1 was not compellable to pay anything to the second and third mortgagees unless defendants 2 to 4 joined with him in paying them off--and it follows from this that in 1935 defendants. 2 to 4 had no legal claim upon defendant 1 for the amount of the purchase-money.

8. But this finding does not conclude the matter. A debt which is not immediately payable in 1935, may nevertheless be attachable in 1935, if it is an obligation already in existence. It is argued for the appellants that there was no debt or obligation in existence at any time before 1937, but it seems clear to me that the obligation to pay for the property purchased sprang into-being by virtue of the very transaction of sale itself in 1929. The right which is given to the vendee by Section 55 (5) (b) is not a right to say that he is under no obligation, but a right to postpone the discharge of that obligation. The cases cited for the appellants, viz., Haridas Acharjia Chowdhry v. Baroda Kishore Acharjia Chowdhry I.L.R.(1899) Cal. 38 Lachman v. Jarbhandan I.L.R.(1927) All. 507 and G. D. John v. Sombamurthi Ayyar (1928) 56 M.L.J. 299 are clear cases in which an obligation is not yet due, and easily therefore distinguishable from the facts of the present case. For these reasons I hold that the obligation in question in this case was a debt attachable in 1935 and these appeals must therefore fail. They are dismissed with costs. Leave refused.


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