UNITED INDUSTRIES (INDIA) Vs. MATHAI JOSEPH

JUDGEMENT

(1.) The appellant is the decree holder in Summary Suit No. 845 of 1974 on the file of the Bombay High Court. The decree in the said was sent to the Sub Court, Pathanamthitta for execution. The execution proceedings are stated to be pending before that Court. It would appear that there was an attachment before judgment of the stock in trade, items of furniture, fixtures, fittings and other movables which belonged to the defendants together with the goodwill of the defendants' business carried on by them in the name of M/s. Geetha Textiles. The attachment order was sent to the Quilon District Court for execution. The attachment was effected. However, on 7-9-1974 the appellant and the judgment debtor entered into a compromise whereby the judgment debtors agreed to pay the amount due from them in instalments; and also under-took that they would not dispose of the properties mentioned in the scheduled annexed to the order of attachment before judgment dated 23rd August, 1974 (except stock in trade).

(2.) It was in the above background that respondents 1 to 3 herein filed Claim Petition No. 217 of 1977 in E. P. No. 18 of 1976 under O.21 R.58 of the C.P.C. claiming ten cents of property and the buildings thereon in Sy. No. 547/3 of Adoor village attached in execution. It might be noted that it was this property that was attached in execution at the instance of the appellant herein pursuant to the order of the Court dated 8-7-1977. The attachment was actually effected on 21-7-1977.

(3.) Respondents 1 to 3 contended inter alia that one half of the attached property and the buildings was purchased by the first respondent herein on 15-4-1977 as per document No. 1169, and the remaining half of the property and the building thereon was purchased by the 2nd claimant herein on the same day as per document No. 1170 for a total consideration of Rs. 76,000/-. Respondents 1 and 2 further contended that ever since the date of purchase, they were in possession and enjoyment of the land and the buildings thereon. It was contended by them that when the order of attachment was made, the judgment debtors (Respondents 4 to 6) had no subsisting title over the property. They also stated that they were not aware of the money decree obtained by the appellant against respondents 4 to 6 and that they had purchased the property bona fide, and the same was not calculated to defeat or defraud the creditors. According to them, they had paid sufficient consideration and the sale deeds were neither benami nor sham documents. It was also contended that they came to know of the decree and the execution proceedings only on 4-8-1977 and the father of the Ist respondent, who was looking after their affairs, came to know about it only on 22-7-1977. Though the appellant herein contended that the sale deeds Exts. X2 and X3 were only pretended sale deeds, not to pass any title to the purchaser, and even if they were real transactions supported by considerations they were vitiated by fraud, and therefore, were voidable at the instance of the creditors. It was further contended by the appellant that respondents 1 and 2 purchased the property with full knowledge of the execution proceedings pending against respondents 4 to 6 (judgment debtors) and the 3rd respondent (the power-of-attorney holder of respondents 1 and 2), who purchased the property on behalf of respondents 1 and 2, was a neighbour of the judgment debtors, at the time of sale and the execution proceedings pending against the judgment debtors, and this was widely known to the people in the locality and it could not be said by any stretch of imagination that the claimants were unaware of the execution proceedings pending against the judgment debtors.