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Swaminatha Aiyar and Vs. Rukmani Ammall - Court Judgment

LegalCrystal Citation
CourtChennai
Decided On
Judge
Reported in55Ind.Cas.766
AppellantSwaminatha Aiyar and ;dharmambal Ammall
RespondentRukmani Ammall
Cases ReferredCheruthazhath Abdulla Haji v. Chetiyandi Ibrayan Kutti
Excerpt:
transfer of property act (iv of 1882), section 53 - instrument evidencing nominal transaction--suit to avoid instrument, whether necessary. - - 959 clearly make a distinction between a real transfer intended to defeat creditors and a sham transfer so intended......19 m.l.t. 390 and the judgment of seshagiri aiyar, j., in cheruthazhath abdulla haji v. cheriyandi ibrayan kutti 50 ind. cas. 959 clearly make a distinction between a real transfer intended to defeat creditors and a sham transfer so intended. no doubt, the judgment of abdur rahim, j., in cheruthazhath abdulla haji v. cheriyandi ibrayan kutti 50 ind. cas. 959 is inclined to hold that, if there was an intention to defeat creditors, the transfer deed cannot be called a sham transaction, though no title was intended to pass from the nominal transferor to the nominal transferee. with the greatest respect i dissent. following the preponderant weight of authority i would dismiss these appeals with costs.spencer, j.2. i cannot agree with the appellant's argument based on cheruthazhath abdulla.....
Judgment:

Sadasiva Aiyar, J.

1. The District Judge's view of the law and of the nature of the defence raised by the creditor (defendant) in his written statement is, in my opinion, right. The Fall Bench judgments in Subramania Ayyar v. Muthia Cheltiar 43 Ind. Cas. 651 : 41 M.P 612 : 33 M.L.J. 705 : 6 L.W. 750 the judgment in Palaniandi Chetti v. Appavu Chettiar 34 Ind. Cas. 778 : 30 M.L.J. 565 : 19 M.L.T. 390 and the judgment of Seshagiri Aiyar, J., in Cheruthazhath Abdulla Haji v. Cheriyandi Ibrayan Kutti 50 Ind. Cas. 959 clearly make a distinction between a real transfer intended to defeat creditors and a sham transfer so intended. No doubt, the judgment of Abdur Rahim, J., in Cheruthazhath Abdulla Haji v. Cheriyandi Ibrayan Kutti 50 Ind. Cas. 959 is inclined to hold that, if there was an intention to defeat creditors, the transfer deed cannot be called a sham transaction, though no title was intended to pass from the nominal transferor to the nominal transferee. With the greatest respect I dissent. Following the preponderant weight of authority I would dismiss these appeals with costs.

Spencer, J.

2. I cannot agree with the appellant's argument based on Cheruthazhath Abdulla Haji v. Chetiyandi Ibrayan Kutti 50 Ind. Cas. 959 that an instrument which is executed with the motive of defeating creditors, must necessarily be one intended to have some effect and, therefore, falls within the scope of Section 53 of the Transfer of Property Act.

3. Whether a transfer is a real or nominal one depends on whether the parties entering into the transaction have at the time an animus transferendi. It they have no such animus, then their act does not fall within the definition in Section 5 of the Transfer of Property Act, and is not a transfer of property at all.

4. Their object may not merely be to amuse themselves. At the same time they may have no real intention that property should pass, and in such a case the document will represent a sham or nominal transaction and it will be unnecessary that a suit under Section 53, Transfer of Property Act, should be brought to have it avoided. I agree that the lower Court's orders were right and that these appeals should be dismissed with costs.


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