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Kali Gounder Vs. Palani Gounder and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai High Court
Decided On
Case NumberS.A. 17 to 19 of 1974 and A.S. 6 of 1973
Judge
Reported inAIR1977Mad266
ActsTransfer of Property Act - Sections 53
AppellantKali Gounder
RespondentPalani Gounder and ors.
Cases ReferredIn Venkata Rangacharyulu Ayyavarlu Garu v. Jammi Turanga Rao
Excerpt:
.....third party who has perfected such title on date of claim order regarding same properties.;in a claim suit under order 21, rule 63 of the civil procedure code, (v of 1908) the material date with reference to which the court has to determine the rights of the parties is the date of the attachment, and the principal question for determination in a suit under order 21, rule 63 of the civil procedures code, is whether or not the order on the claim petition was right and in that sense the court is in such a suit called upon to deal with the rights of parties as they stood on the date of the attachment. therefore, the rights of the parties in this case have to be dealt with as they stood on the date of the attachment, namely, 30th january, 1968. no doubt, the finality of the claim order..........1969 were filed by the alienees from palani gounder for setting aside the same summary order. the suit property belonged on one ramaswami gounder who was indebted to several persons. the said ramaswami gounder filed i. p. 23 of 1956 in the sub court, salem, for getting himself adjudicated as an insolvent. during the pendency of that petition, he decided to settle the matter with his creditors. consequently, a composition deed ex. a. 4, dated 18-2-1956 was executed by ramaswami gounder whereby it was arranged that all the creditors must be ascertained and the properties of ramaswami gounder should be sold and the sale proceeds should be distributed amongst the creditors, and some of the creditors were constituted as trustees. in pursuance of that composition deed, the sale deed ex. a. 1.....
Judgment:
1. The third defendant in O. S. 1353 of 1968, 234 of 1969 and 952 of 1969 who succeeded in the trial court but failed in the lower appellate court is the appellant. S. A. 17, 18 and 19 of 1974, arise out of A. S. 6, 7 and 8 of 1973, which arose out of O. S. 1353 of 1968, 952 of 1969 and 234 of 1969 respectively.

2. O. S. 1353 of 1968 was filed by Palani Gounder, the first respondent in S. A. 17 of 1974 against four persons viz., Seeranga Gounder, Sellammal, Kali Gounder and Muthu Gounder for setting aside a summary claim order passed in E. P. 406 of 1968 in O. S. 752 of 1966 on the file of the trial court on 21-8-1968. O. S. 952 of 1969 and 234 of 1969 were filed by the alienees from Palani Gounder for setting aside the same summary order. The suit property belonged on one Ramaswami Gounder who was indebted to several persons. The said Ramaswami Gounder filed I. P. 23 of 1956 in the Sub Court, Salem, for getting himself adjudicated as an insolvent. During the pendency of that petition, he decided to settle the matter with his creditors. Consequently, a composition deed Ex. A. 4, dated 18-2-1956 was executed by Ramaswami Gounder whereby it was arranged that all the creditors must be ascertained and the properties of Ramaswami Gounder should be sold and the sale proceeds should be distributed amongst the creditors, and some of the creditors were constituted as trustees. In pursuance of that composition deed, the sale deed Ex. A. 1 dated 9-8-1956 was executed in favour of Palani Gounder, the plaintiff in O. S. 1353 of 1968, whereby some of the trustees directed the former to discharge some of the debts. The appellant Kali Gounder was one of the creditors, but his debts were not directed to be discharged by Palani Gounder in the sale deed Ex. A. 1. The appellant therefore filed O. S. 351 of 1968, alleging that the sale under Ex. A. 1, was hit by S. 53 of the T. P. Act. That suit was dismissed on the ground that he could not file the suit merely because he had been left out of account in the sale deed Ex. A. 1. That decree was confirmed by the learned District Judge, Salem, on appeal in A. S. 20 of 1961. In S. A. 767 of 1963, which was filed against that decree it was contended that the sale under Ex. A. 1 by some of the several trustees constituted under the composition deed was void. But it was held that this question cannot be gone into in the suit and it was open to the creditor to attach the property in execution of the decree obtained by him in O. S. 351 of 1968, and the second appeal was dismissed. Subsequently, the appellant filed E. P. 38 of 1968 and got the property attached in execution on 30-1-68. But on 12-3-1968, Palani Gounder, the purchaser under Ex. A. 1, filed a claim petition E. A. 498 of 1968 and it was dismissed after enquiry on 24-8-1968. Subsequently, the appellant proceeded in execution and a date was fixed for sale of the attached property. Thereafter Palani Gounder filed O. S. 1353 of 1968 on 13-9-1968 to set aside the claim order dated 24-8-1968 in E. A. 498 of 1968 and obtained an interim injunction in those proceedings restraining the appellant from bringing the property to sale in execution of the decree obtained by him on O. S. 351 of 1968.

3. The allegation in O. S. 1353 of 1968 was that Palani Gounder has obtained title to the property by his purchase under Ex, A. 1, even though it was executed by some only of the trustees constituted in the composition deed Ex. A. 4, and that even if the sale under Ex. A. 1 is not valid, he had perfected his title by adverse possession by the date of the dismissal of the claim petition on 24-8-1968, and therefore the appellant was not entitled to bring the property to sale in execution of the decree. The defence was that the sale under Ex. A 1 is void on the ground that it was not executed by all the trustees appointed in the composition deed Ex. A. 4, and the rights of the parties have to be determined as on the date of the attachment, namely 30-1-1968 and as the period of 12 years has not elapsed on that date, Palani Gounder has not acquired title to the property by prescription and the appellant is entitled to proceed in execution. The same reason was advanced in the other suits for contending that the plaintiffs in those suits are not entitled to any relief.

4. The trial Court found that the sale under Ex. A. 1 was void on the ground that the sale deed has been executed by some only of the trustees appointed in the composition deed Ex. A. 4 and not by all of them and that the rights of the parties had to be determined as on the date of the attachment viz., 30-1-1968 and there was no question of prescribing title by adverse possession by Palani Gounder from the date of Ex. A. 1. In that view, that trial court found that the claim order was not liable to be set aside and dismissed all the three suits.

5. But after the appeals were filed, an interim injunction restraining the appellant herein from proceeding in execution against the property was obtained in I. A. 153 of 1973 in A. S. 6 of 1973. The learned Additional District Judge agreed with the trial court that the sale under Ex. A. 1 was void on the ground that the sale deed has been executed by some only of the trustees constituted in the composition deed Ex. A. 4, but purporting to follow the Full Bench decision of this court in the Dharapuram Janopakara Nidhi Ltd. by its Secretary Adisesha Iyer v. Lakshminarayana Chettiar(1939) 1 Mad LJ 802: (AIR 1939 456), he held that the period of 12 years had elapsed by the date of the claim order from the date of the sale under Ex. A. 1 and the attachment effected on 30-1-1968 at the instance of the appellant will not arrest the period of adverse possession of Palani Gounder and that Palani Gounder and his alienees have perfected their title to the suit property by prescription; and he allowed all the appeals with costs throughout.

6. Mr. R. Sitaraman, learned counsel for the appellant, submits that in the claim suit the rights of the parties have to be determined as on the date of attachment and that as Palani Gounder who had taken the void sale deed Ex. A. 1, dated 9-8-1956 from some only of the trustees appointed in the composition deed Ex. A. 4 could not be held to have acquired title to the property by adverse possession by the date of attachment that was effected on 30-1-1968, the appellant should be held to be entitled to proceed against the property in execution of the decree obtained by him against Ramaswami Gounder, and the claim order is therefore not liable to be set aside. In this he relies upon the decision of a Bench of this court in Venkata Rangacharulu Ayyavarlu Garu v. Jammi Turanga Rao (1938) 2 Mad LJ 430: (AIR 1938 Mad 857). He rightly does not dispute the position that an attachment will not interrupt adverse possession of a stranger, holding adversely to the judgment debtor. But he submits that the learned Additional District Judge has misconstrued the law laid down in the aforesaid decision of the laid down in the aforesaid decision of the Full Bench inDharapuram Janopakara Nidhi Ltd. v. Lakshminarayana Chettiar, (1939) 1 Mad LJ 802: (AIR 1939 Mad 456).

7. Mr. V. Krishnan, learned counsel for the contesting respondents invited my attention to the decision in Fatima Bibi v. Hajee Mohammed, AIR 1943 Mad 425, where it has been held that attachment does not interrupt adverse possession. He submitted that notwithstanding the fact that Palani Gounder had not acquired title to the property by adverse possession on 30-1-1968, the date of the attachment, he had acquired the right by the date when the claim petition was dismissed, namely, 24-8-1968 and it was therefore not open to the appellant to proceed against the property in execution of the decree obtained by him against Ramaswami Gounder in O. S. 351 of 1958.

8. In Fatima Bibi v. Hajee Mohammed, AIR 1943 Mad 425 it is observed thus--

"It has been decided in this Province that an order of attachment does not interrupt the possession of a person holding adversely to the true owner. This was held in 1901 in Seetharama Reddi v. Venku Reddi, (1901)11 Mad LJ 344 and Ranganatha Iyer v. Srinivasa Iyengar, 49 Mad LJ 656: (AIR 1926 Mad 42). A decreeholder whose attachment has been raised is given by the statute the right to institute a suit for a declaration of his right to attach and the declaration must have regard to the rights of the parties at the date of the institution of the suit. It would be a negation of the right given by Order 21 Rule 63, to hold that when the suit has been filed in time, the person wrongly in possession of the property can get a title by adverse possession after the institution of the suit. In our opinion, the institution of the suit arrests the running of time in favour of defendant 1. This means that the plaintiffs-appellants are entitled to a declaration of their right to attach seven-eighth of the property in the suit".

9. Even in Dharapuram Janopakara Ltd. v. Lakshminarayana Chettiar, (1939) 1 Mad LJ 802: (AIR 1939 Mad 456) (FB), relied on by the learned counsel for the appellant, it is observed--

"It was held so long ago as in Krishnama Rajah v. Narayanasami Raja (1868-69) 4 MHCR 281 and Narayanarao Damodar Dabholkar v. Balkrishna Mahadev Gadre (1879) 4 Bom 529 (FB), that an attachment in execution of a decree does not dispossess the party in possession; and in Seetharami Reddi v. Venku Reddi, (1901) 11 Mad LJ 344 and Ranganatha Iyer v. Srinivasa Iyengar, 49 Mad LJ 656 L (AIR 1926 Mad 42), this court has expressly laid down that an attachment does not interrupt the adverse possession of a stranger holding adversely to the judgment debtor."

The learned Additional District Judge appears to have based his decision that Palani Gounder acquired title to the property by prescription by adverse possession of the property from the date of Ex. A. 1, namely, 9-8-1956 to the date of the claim order, namely, 24-8-1968 on a perusal of only the headstone in the decision of the Full Bench of this court in Dharapuram Janopakara Nidhi Ltd. v. Lakshminarayana Chettiar, (1939) 1 Mad LJ 802: (AIR 1939 Mad 456) which reads thus--

"A suit under O. 21, R. 63 is in form and substance a declaratory suit and it will be an unreasonable exercise of discretion by the court to make a declaration of the decree-holder's right to attach if the period of limitation of 12 years had expired between the date of the attachment and the date of the suit unless the property had already been sold in time."

One of the contentions raised before the learned Judges in that case was that in a claim suit, the material date with reference to which the court has to determine the right of the parties is the date of the attachment; and the learned Judges have observed (at page 811) that it may in a sense be right to state that the principal question for determination in a suit under O. 21, R. 63 C.P.C., is whether, or not the order on the claim petition was right and in that sense the court is in such a suit called upon to deal with the rights of parties as they stood on the date of the attachment. Therefore, I agree with Mr. Sitaraman that the rights of the parties in this case have to be dealt with as they stood on the date of the attachment, namely, 30-1-1968. The attachment of the properties in the case out of which the Full Bench decision arose was by a third party decreeholder and it cased after his claim had been settled before the properties were brought to sale in execution of the decree. The learned Judges have observed at page 809 that the weight of authority is in favour of the view that the finality of the claim order cannot be invoked even by the particular decreeholder who was a party to the claim order and in respect of the very decree which was then under execution, unless he was proceeding to bring the properties to sale in pursuance of that very statement. That observation is clearly in favour of the stand taken by Mr. Sitaraman in support of the case of the appellant in this second appeal, for the claim order has been made in this case in respect of the very attachment which was effected at the instance of the appellant. The attachment by the stranger decreeholder in that case was in 1917, and though the claim petition was dismissed on 9-7-1917, and the properties were sold in execution of the third party's decree, the sale was set aside on the objections of the judgment debtor and the decree of the third party decreeholder was otherwise satisfied on 10-8-1918. The person claiming title by adverse possession claimed that he got into possession of the properties in 1911, under an agreement for the sale of the properties to him after paying the consideration for the sale and it has been held that he had acquired title by prescription by the date of the attachment which in that case was 8-11-1929. But, in the present case, the attachment has been made on 30-1-1968 at the instance of the appellant himself before the expiry of the period of 12 years from the date of the void sale deed Ex. A. 1, namely 9-8-1956 in pursuance of which Palani Gounder got into possession of the property. In this connection it is necessary to note the following observation made in the aforesaid Full Bench decision at pages 808 and 809 (of MLJ): (at p. 460 of AIR)--

"As already pointed out, the claim order of 9th July 1917 was passed not in connection with the appellant's decree or in any proceeding to which he was a party; and even as regards the third party's decree then under execution, the decree was otherwise satisfied, making it necessary for the claimant to take any steps to vindicate his rights................... I may add that the weight of authority is in favour of the view that the finality of the claim order cannot be invoked even by the particular decreeholder who was a party to the claim order and in respect of the very decree which was then under execution unless he was proceeding to bring the property to sale in pursuance of that very attachment."

10. In Venkata Rangacharyulu Ayyavarlu Garu v. Jammi Turanga Rao, (1938) 2 Mad LJ 430: (AIR 1938 Mad 857), it is observed as follows--

"In a suit like this to set aside the claim order it is clear that the rights of the parties on the date of the attachment or on the date of the order are the rights which have to be taken into consideration. On 6-1-1930, the appellant (assuming him to be in adverse possession as against Venkataseshagiri Rao) had not been in possession for 12 years, and therefore he had not perfected his title by prescription. Therefore on that date the real owner of the one half share which was attached was Venkataseshagiri Rao. The effect therefore of the order passed by the learned District Munsif on the claim petition was to declare that in so far as Venkataseshagiri Rao's half share was concerned the appellant was holding it not on his own behalf but on behalf of the judgment debtor. To succeed in the suit the appellant was therefore bound to show that this finding was incorrect. We think it is too obvious that he cannot do this by waiting for five months more and then saying that even though he had no title in January he has got a title in June and therefore the claim order was wrong."

11. In the present case also it is not open to Palani Gounder who had not acquired title to the property by prescription on 30-1-1968, the date of the attachment, to say that the appellant is not entitled to seek execution of his decree obtained against Ramaswami Gounder who had not lost his title to the property by that date by any adverse possession of Palani Gounder and say that he is not entitled to proceed against the property, because by the date of the claim order, namely, 24-8-1968 the period of 12 years had expired and he had acquired title to the property by prescription. It is therefore not possible to agree with the learned Additional District Judge that the claimants are entitled to the property claimed by them and that the appellant is not entitled to proceed against the property in pursuance of the attachment effected in execution of the decree obtained by him against Ramaswami Gounder who had an enforceable title to the suit property on the date of attachment, 30-1-1968. Palani Gounder could have prescribed title to the property after the attachment only subject to the attachment though from the date of the void sale under Ex. A. 1 dated 9-8-1956. The appellant is entitled to proceed against the property.

12. The learned counsel for the contesting respondents submitted that Palani Gounder had discharged some debts of some of the creditors of Ramaswami Gounder in pursuance of the sale under Ex. A. 1 and that provision must be made in equity for the payment of that amount by the appellant. No plea has been raised that in pursuance of the sale under Ex. A. 1, Palani Gounder had discharged some of the debts of the other creditors of Ramaswami Gounder. There is no evidence to that effect. Even if some of the debts of Ramaswami Gounder had been discharged it could not be held that Palani Gounder is entitled to any such equity against the appellant who got the property attached on 30-1-1958.

13. These second appeals are therefore allowed with costs payable by the contesting respondents. Advocate's fee one set. No leave.

14. Appeals allowed.


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