1. During the pendency of a suit on a bond-note by the defendant No. 1 against defendant No. 2, the latter sold his homestead with a tank to the plaintiff for a consideration of Rs. 700, The defendant No. 1 subsequently obtained a decree on the bond-note and attached the said land. The plaintiff put in a claim under Section 278 of the Civil Procedure Code and it was disallowed and the property was sold and purchased by defendant No. 1 for Rs. 40 only, his decree being for Rs. 348 odd. The plaintiff brings this suit under Section 283 of the Civil Procedure Code for declaration of title and confirmation of possession. The defendant pleaded that the purchase of the plaintiff was benami for the debtor and fraudulent.
2. The first Court held that the purchase was not benami, and that there was no evidence that the plaintiff knew of the decree or the suit and decreed the plaintiff's suit.
3. The learned Subordinate Judge has set aside the decree of the first Court holding, that although consideration had been paid and plaintiff was in possession, the defendant No. 2 living on some other land, the defendant No. 2 made the sale with the object of defeating the claim made by defendant No. 1, that the plaintiff was aware of the fraudulent motive of defendant No. 2 in selling the property to him and helped him in carrying out the fraudulent object.
4. It is contended in second appeal before us (1) that the case has been decided on a point not raised by the pleadings, (2) that the purchase of the defendant No. 1 was made after the present suit of the plaintiff and is, therefore, subject to the result of the present suit, (3) that upon the findings the suit should have been decreed, (4) that the defendant No. 1 cannot, as a defendant acting for himself and not for the whole body of creditors, avoid a transfer that was only voidable under Section 53 of the Transfer of Property Act, (5) that the defendant's claim being only for Rs. 348 odd under his decree his purchase could be impeached only to the extent of Rs. 348 and he was ready to pay the same.
5. As regards the first ground, there can be no doubt that the written statement of defendant No. 1 does raise the point, although not precisely in the words of Section 53 of the Transfer of Property Act. The section was relied upon by the Munsif in the claim case and must have been in contemplation of the defendant although his main case was that the kabala was a benami transaction. It is clear, however, that the only issue framed in this connection was the issue of benami and the evidence was directed almost entirely to the question of benami. The ostensible object of the creation of the benami, however, being the defeating of the prospective execution of a prospective decree, the issue actually raised in the case may be taken to have been comprehensive enough.
6. The execution purchase of defendant No. 1 was after the institution of the present suit and must be subject to the result of the suit. This disposes of the 2nd ground.
7. In order to decide on the third ground, we must consider the scope of the suit and the effect of the findings.
8. The suit was one under Section 283 of the Civil Procedure Code. The scope of such a suit was the subject of discussion in the Privy Council in the case of Phul Kumari v. Ghanshayam Misra 35 C. 202 : 7 C.L.J. 36 : 5 A.L.J. 10 : 14 Bur. L.R. 41 : 12 C.W.N. 169 : 10 Bom. L.R. 1 : 17 M.L.J. 618 : 2 M.L.T. 506 and the Judicial Committee held that a suit under Section 283 was essentially a suit for the review of a summary decision. The summary decision in a claim case is confined to a consideration of the possession of the judgment-debtors at the time of the attachment. Any other discussion in such a decision is material only so far as it is relevant to the determination of that essential matter.
9. In this case, the summary decision was that the judgment-debtor was in possession and not the claimant (plaintiff) and the finding of the learned Subordinate Judge is that the plaintiff was and has been in possession after a purchase for valuable consideration and not the judgment-debtor defendant No. 2. Upon this finding, the suit under Section 283 should have been decreed unless there was anything in the pleadings outside the scope of Section 283, Civil Procedure Code, to restrain or restrict such a result.
10. The fourth ground resolves itself into two parts (i) whether one creditor can take action for himself or must he act on behalf of the whole body of creditors (ii) whether he can take action by way of defence to a suit brought against him or must he proceed by an independent suit. The first part of the question does not arise in this case for two reasons: the first is, that upon the findings there was but one creditor in this case: and the second is, that the defendant No. 1 having already obtained a decree for his debt is entitled to act for himself, he may have a declaration that the conveyance was void as against his own claim. See Smith v. Hurst 10 Hare 30 : 22 L.J. Ch. 289 : 17 Jur. 30; Spirett v. Willows 11 Jur. (N.S.) 70 : 3 De G.J. & S. 293 : 34 L.J. Ch. 365 : 12 L.T. 614 : 13 W.R. 329 : 5 Giff. 49; Blenkinsopp v. Blenkinsopp 1 De G.M. & G. 495 : 21 L.J. Ch. 401 : 16 Jur. 787. The reason is that he is more than a creditor, he is a judgment-creditor. As regards the second part of the ground, there is some apparent difficulty in coming to a satisfactory answer that would meet all cases. If there are more creditors and the particular creditor impleaded as a defendant stands on the same footing as other creditors, he must plead for all and may, perhaps, he allowed to do so even as a defendant if the Court has jurisdiction to entertain a claim for the claims of all the creditors. That, however, is a largo question that does not arise in the case. Here the defendant No. 1 is the only creditor and he has already obtained judgment and taken out execution. He could bring an independent suit for himself, but can he do as defendant what he could have done as a plaintiff? There are two reported cases which have a bearing on this point: Ishan Chunder Das Sarkar v. Bishu Sirdar 24 C. 825 : 1 C.W.N. 665 Maclean, C.J., and Banerji, J., and Rajani Kumar Dass v. Gaur Kishore Shaha 35 C. 1051 : 7 C.L.J. 586 : 12 C.W.N. 761 Mitra and Caspersz, JJ. In both these cases, the plea under Section 53 was raised by a defendant and no objection was made to the competency of the plea by way of defence although the parties were ably represented. It is true the question was not raised and discussed and these cases would not stand in the way of our overruling the plea as incompetent, but is there any reason why we should do so? The section says the transfer would be voidable at the option of the party delayed, etc., it is not ipso facto void and is, therefore, valid until it is avoided. If he does not care to avoid the transfer, but waits until his debt or decree is barred by limitation, he loses the right. See Re Madderer, Three Towns Banking Co. v. Maddever 27 Ch. D. 523 : 53 L.J. Ch. 998 : 27 Ch. D. 523 : 52 L.T. 36 : 33 W.R. 286. If he takes advantage of his legal right to avoid, he may do so by way of suit which is the most unequivocal way of doing it or he may express his determination by way of defence to a suit brought against him. See Clough v. London and North Western Railway Co. L.R. 7 Ex. 26 : 41 L.J. Ex. 17 : 25 L.T. 708 : 20 W.R. 189. See also Eastern Mortgage and Agency Co. v. Rebati Kumar Ray 3 C.L.J. 260 and Hem Chandra Sarkar v. Lalit Mohan Kar Kar 14 Ind. Cas. 515. In this case the election was made for the first time when the plaintiff made a claim in the execution taken out by defendant No. 1 and defendant No. 1 insisted on his determination in his defence in this case. He had every right to say that the title upon which the plaintiff relied was in fraud of his claim and, therefore, ineffectual as against him.
11. The fifth and last ground is also good. The only interest which the creditor has in the property of his debtor is his right to satisfy himself out of that property. If the property is larger than what would satisfy his demand, he cannot complain if his right to avoid the transfer is confined to that part of the properly which is taken out of his reach by the transfer or if the transferee be made to satisfy his demand. In the case of the Ideal Bedding Company v. Holland (1907) 2 Ch. 157 : 76 L.J. Ch. 441 : 93 L.T. 774 : 23 T.L.R. 467 : 14 Manson 113 the transferee was directed to join and concur in all acts and things necessary for making the property comprised in the transfer available for satisfying the claims of the creditors. In the case of Cornish v. Clark L.R. 14 Eq. 184 : 42 L.J. Ch. 14 : 26 L.T. 494 : 20 W.R. 897 Lord Romilly said in respect of a settlement in fraud of creditors: 'I think the whole bad as against creditors, but merely as against them, and that the donees must rateably contribute to pay the debt and the costs of the suit.'
12. We, therefore, set aside the decree of the lower Appellate Court and order and decree that the title of the plaintiff be declared subject to the satisfaction of the decree of defendant No. 1. If the amount of the decree with interest as decreed be not paid within one mouth from the arrival of the record in the Court below, of which arrival due notice will be given, the property in suit will be sold and any surplus remaining after the satisfaction of the decree will be received by the plaintiff. Each party will bear its own casts in all Courts.