Sheo Gobind Koeri vs Ram Asray Singh and Another

Rowland, J.—This second appeal is by defendant 2 in the original suit. The claim of the plaintiff was to recover possession of certain lands on the following allegations: The plaintiff had obtained a money decree on 6th September 1927 which on appeal was confirmed on 2nd July 1928 against defendant 1. Defendant 1 executed on 6th July 1928 a document purporting to be a rehan bond for a consideration of Rs. 1200 in favour of defendant 2 and secured on certain properties which are among those comprised in this litigation. The plaintiff executed his money decree on 18th June 1931 and bought as being the properties of his judgment-debtor the immovable property now in suit on 8th December 1931. When the plaintiff sought to obtain delivery of possession on 13th February 1933 he was opposed, the claim being put forward that defendant 2 was mortgagee in possession of the property.

The plaintiff alleges that the alleged rehan bond is a mere colourable transaction executed by defendant 1 in favour of his brother-in-law, defendant 2, passing neither title nor possession but designed merely to defeat the claim of the plaintiff. The defence was that the rehan bond was genuine and for consideration and defendant 2 was in possession on his own account under it. Among the properties auction-purchased by the plaintiff is one bearing Survey Plot No. 407 which is not covered by the defendant''s document and to which the plaintiff''s title is not denied by the defendant. The Munsif accepted the case of the defendant and while giving the plaintiff a decree for his title and possession over plot No. 407 he dismissed the remainder of the claim. On appeal by the plaintiff the lower Appellate Court has held that the alleged transaction between defendant 1 and defendant 2 was a colourable transaction, that defendant 2 neither paid consideration for the rehan bond nor got possession of the rehan property, and that the circumstances, which he set forth in detail, left no room for doubting the fraudulent character of the rehan bond. He denounced the bond as a farzi document brought into existence by defendant 1 in favour of defendant 2 without consideration for defeating the debts of the plaintiff. He allowed the appeal and decreed the suit in full with costs and future mesne profits.

In second appeal it is contended that such a suit as this is not maintainable; the elaim is in substance one of the nature provided for by Section 53, T.P. Act, but the plaintiff is not entitled to maintain such a suit for he is not in a position to prefer a claim on behalf of the creditors generally, the property being no longer property of defendant 1 but, assuming the plaintiff''s claim to be correct, having been purchased by the plaintiff himself. It is contended that failing a suit u/s 53, T.P. Act, there is no other manner in which a transfer can be avoided; therefore the suit should have been dismissed as not maintainable, and reference has been made to Sri Thakurji and Others Vs. Narsingh Narain Singh and Others, . The argument appears to rest on some confusion of thought. There is no rule of law that a plaintiff who has been sought to be defeated by a fraudulent and colourable transfer, which is a sham transaction, is limited to the remedy of Section 53, T.P. Act.

The plaintiff''s claim is different; it is based on an allegation that the alienation was collusive and fictitious. If this is established then the title to the property remained with the transferor and did not pass to the transferee. It does not therefore need to be transferred back by the Court. The distinction between the two classes of cases is noticed by Sir Lawrence Jenkins delivering the judgment of the Privy Council in Mina Kumari Bibi v. Bijoy Singh Dudhuria A.I.R (1916) P.C. 238 where reference is made to an allegation in the plaint that

the judgment-debtor, Babu Chhatrapat Singh, was, and always remained, the real owner of the properties in dispute.

In the opinion of his Lordship,

strictly this means that the transaction was benami and not that it was a fraudulent transfer within the meaning of Section 53, T.P. Act. The difference is distinct, though it is often slurred.

The position regarding title when parties have entered into a benami transaction was also examined by the Privy Council in Petherpermal Chetty v. Muniandy Servai (1908) 35 Cal. 551 where Lord Atkinson, after stating that a benami conveyance is not intended to be an operative instrument, quoted with approval a passage from Mayne''s Hindu Law as to benami transaction:

Where a transaction is once made out to be a mere benami it is evident that the benamidar absolutely disappears from the title. His name is simply an alias for that of the person beneficially interested.

In the case which was cited before us, Sri Thakurji and Others Vs. Narsingh Narain Singh and Others, it was pointed out by Das J. that the suit which he was considering would be improperly framed and not maintainable if it be regarded as one u/s 53, T.P. Act, to obtain a declaration that the conveyance in question is voidable at the instance of the creditors of the transferor. He went on to point out that the suit which he was considering was not such a suit; it did not fall u/s 53, T.P. Act, but was a suit to obtain possession of the property. That being the primary object of the action, the fact that the plaintiffs as a preliminary to this asked for a declaration that the conveyance was a fraudulent conveyance did not change the character of the action. He said that the primary object of an action u/s 53 of the Act was to make the assets of the transferor available to the general body of creditors, but that was not the object here. He treated the suit therefore as a suit to recover possession on the strength of the title acquired by the plaintiffs by a sale held in execution of their decree and affirmed the decision of the Courts below allowing the claim.

The facts are entirely on all fours with those of the case before us; and it is perfectly clear that there is no bar to the plaintiff succeeding on the strength of his title after obtaining a declaration that the nominal transfer by defendant 1 in favour of defendant 2 was a colourable and a sham transaction. The main contention for the appellant fails therefore.

But in the order portion of the learned District Judge''s judgment it seems to be directed that the plaintiff is to get future mesne profits on the entire property in suit. If so, that direction loses sight of the fact that plot 407 was not claimed by either of the defendants and there does not seem to be any proof that the plaintiff was kept out of possession of it. Mesne profits therefore ought to be allowed on the other property in suit excluding plot 407. With this modification I would dismiss the appeal.

Yarma, J.

I agree. The main point argued by the learned advocate on behalf of the appellant appears to have been based practically on the statement in para. 8 of the plaint which runs as follows:

Defendant 1 was repeatedly asked to deliver possession of the land in suit to the plaintiff and defendant 2 was asked to declare the said rehan deed to be useless, but the said defendants do not pay any heed. Hence the necessity for the suit. Besides other grounds, this suit is also filed for the benefit of the plaintiff and all other creditors, should there be any bona fide creditor, u/s 58, T.P. Act.

But when we look into the relief portion of the plaint, the plaintiff sought the following relief:

The Court may be pleased to hold and declare that the rehan deed, dated 6th July 1928, executed by defendant 1 in favour of defendant 2, is quite fraudulent and without consideration and was executed to avoid payment of the debt due to the plaintiff and that the same is invalid in law and defendant 2 has acquired no title thereunder. After the above declarations, the Court may be (pleased to award possession and occupation of the land in suit mentioned in Schedule A, to the plaintiff.

It will be seen that the relief actually sought in this case is hardly distinguishable from the relief sought in Sri Thakurji and Others Vs. Narsingh Narain Singh and Others, which has been referred to by the learned advocate for the appellant and has been discussed at length by my learned brother.

The appeal must be dismissed with the modification indicated above.

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