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Kosuru Ademma Vs. Chevuru Subbamma - Court Judgment

LegalCrystal Citation
SubjectCivil;Property
CourtChennai
Decided On
Reported in(1942)2MLJ491
AppellantKosuru Ademma
RespondentChevuru Subbamma
Cases ReferredRamaswami Chettiar v. Mallappa Reddiar
Excerpt:
- - the district munsiff failed to appreciate that the decision in these cases was arrived at between the assignors and the assignees of the decrees and had nothing whatever to do with a third party who was attacking the action of the assignor on the ground that the assignment was fictitious and fraudulent......and his minor sons in the court of the district munsiff of kavali, in o.s. no. 91 of 1932. rama naidu assigned this decree in 1935 to one kotappa naidu who assigned it in his turn to the plaintiff on the 11th july, 1935. the assignment was recognised by the court on the 26th. august, 1935. but before this a decree was obtained by the 4th. defendant against kotappa naidu in o.s. no. 815 of 1932. ramanappa setti was adjudged insolvent on his own petition in i.p. no. 1 of 1934. a private composition was arrived at during the course of these proceedings between the insolvent and his creditors under which defendants 1, 2 and 3 were appointed trustees. they were to take possession of a portion of the insolvent's property and to sell the same with the object of distributing the sale proceeds.....
Judgment:

Abdur Rahman, J.

1. A decree was obtained by one P. Rama Naidu against Ramanappa Setti and his minor sons in the Court of the District Munsiff of Kavali, in O.S. No. 91 of 1932. Rama Naidu assigned this decree in 1935 to one Kotappa Naidu who assigned it in his turn to the plaintiff on the 11th July, 1935. The assignment was recognised by the Court on the 26th. August, 1935. But before this a decree was obtained by the 4th. defendant against Kotappa Naidu in O.S. No. 815 of 1932. Ramanappa Setti was adjudged insolvent on his own petition in I.P. No. 1 of 1934. A private composition was arrived at during the course of these proceedings between the insolvent and his creditors under which defendants 1, 2 and 3 were appointed trustees. They were to take possession of a portion of the insolvent's property and to sell the same with the object of distributing the sale proceeds amongst the creditors. They appear to have done so and had some money in their hands when the plaintiff proceeded to execute her decree assigned in her favour on the 26th August, 1935 and to attach the money in the hands of defendants 1 to 3. But before she could realise any money from them the 4th defendant attached the amount (Its. 140-6-11) on the 8th February, 1939, alleged to be due to her judgment-debtor Kotappa Naidu by Ramanappa Setti which was in the hands of the trustees and realised it from them in execution of her decree. The plaintiff thereupon brought the suit out of which the present revision arises for the recovery of the sum realised by the 4th defendant from the trustees of Ramanappa Setti insolvent (defendants 1 to 3) on the ground that the decree had been assigned to her by Kotappa .Naidu and that the 4th defendant could not therefore recover any money from the trustees, she (the plaintiff) alone being entitled to recover the same from them in execution of the decree assigned to her.

2. It was contended on behalf of the 4th defendant that the assignment by Kotappa Naidu was made fictitiously and with the object of defrauding her and that she was entitled to recover the money due to Kotappa Naidu by the trustees in spite of the assignment in favour of the plaintiff. The District Munsiff held that the assignment by Kotappa in favour of the present plaintiff was without consideration and fictitious and made with the object of defrauding the 4th defendant. But in view of the assignment of the decree made in favour of the plaintiff she alone was found entitled to realise the amount of the decree from the trustees and a decree was passed in her favour. The 4th defendant felt aggrieved by the decree and has come up to this Court in revision.

3. In support of his decision the learned District Munsiff relied on the decisions in Gurdial Singh V. Gurbahhsh Singh I.L.R. (1926) Lah. 35 : A.I.R. 1927 Lab. 110. and on Palaniappa Chettiar v. Subramania Chettiar (1924) 48 M.L.J. 419 : I.L.R. 48 Mad. 553. These cases can-not help the plaintiff. The District Munsiff failed to appreciate that the decision in these cases was arrived at between the assignors and the assignees of the decrees and had nothing whatever to do with a third party who was attacking the action of the assignor on the ground that the assignment was fictitious and fraudulent. If an assignment of a decree is made by a decree-holder to defraud his own creditors it may not be open to him to object to the assignment during his lifetime (for which see Bada Kristam Naidu v. Durvada Patrudu : AIR1927Mad903 .); but it is entirely incorrect to say that his creditors have no right to attach the decree and to allege that the assignment was fictitious and was not binding on them. There is no principle or rule of law which debars the assignor's creditors from attacking the assignment. Fraud vitiates the most solemn documents and even proceedings of Court and I cannot see how the 4th defendant could be held to be debarred from attacking the validity of the assignment of the decree and from showing that her debtor was still in fact the owner of the decree obtained by him against Ramanappa Setti. Section 47, Civil Procedure Code, lays down that

Where a question arises as to whether any person is or is not the representative of a party, such question shall for the purposes of this section, be determined by the Court.

The term 'representative' in this section is not confined to legal representatives but would also include the representatives in interest who may have obtained or who may allege to have obtained the decree-holder's interest by transfer or assignment. If that assignment is challenged and it is contended by a creditor that the assignee is not the representative of the decree-holder and that so far as he (the decree-holder) is concerned the decree cannot be taken to have been assigned and the interest in the decree still continues to vest in the assignor the question would apparently have to be gone into by the executing Court. And if the Court finds that the assignment was fraudulent it would refuse to recognise the assignment of the decree at least so far as the objecting creditor is concerned.

4. The only contention advanced on behalf of the respondent in reply was that an objection of this nature could not be relied on on behalf of the 4th defendant as this was not a suit under Section 53 of the Transfer of Property Act; but the learned Counsel for the respondent forgets that it was his own client who had brought the suit for the recovery of money and it is always open to a defendant to show that the transaction was fraudulent and that the plaintiff was not entitled to execute the decree assigned in his favour. Section 53 of the Transfer of Property Act cannot in such a case stand in the defendant's way. This was held by a Full Bench of this Court in Ramaswami Chettiar v. Mallappa Reddiar : (1920)39MLJ350 .

5. I must, for the above reasons, vacate the decree passed by the District Munsiff and dismiss the suit. The 4th defendant will have her costs both in this Court and in the Court below.


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