EPRAIN Vs. SUIVERT AND DHOLAKIA (P) LTD

JUDGEMENT

(1.) The respondent sued for Rs. 12,800 as compensation for loss caused by, undisclosed attachment before judgment and subsequent court sale for a decree debt of a property, purchased by the respondent plaintiff from the defendant. The property comprised 12 cents of land and a building. It belonged to the defendant and was situated in Survey Nos. 53/1, 2 and 3 in Fort. Cochin. The sale price as per the sale deed which is dated 31st May 1964 was Rs. 17,000. The plaint proceeded on the basis that the defendant represented to the plaintiff company and assured it before the execution of the sale deed that the property was not subject to any encumbrance or charge except for a mortgage debt which ripened into a mortgage decree in O.S. No. 79 of 1961 in favour of the Chaldean Syrian Bank, Trichur, on the basis of a mortgage deed of 1957. The amount for the payment of that decree debt was Rs. 11,342 at the time of the sale. This amount out of the sale consideration was reserved with the plaintiff and the balance amount of Rs. 5,658 alone had been paid in cash.

(2.) In the document of sale the defendant had undertaken to indemnify the plaintiff company if it suffered any damage or loss due to any undisclosed encumbrance or impediment or other defect in the title. In pursuance of the sale the plaintiff took possession of the property. Nine months after the sale the property concerned was sold for another money decree to an auction purchaser decree holder on the strength of undisclosed attachment before judgment in respect of the property. The sale was in execution of the decree in O.S. No. 72 of 1959 of the Ernakulam Sub Court. It would appear chat execution proceedings were pending even before the execution of the sale deed in favour of the plaintiff company. It is the plaintiff's case that the defendant fully aware of the fact in regard to this court proceeding fraudulently suppressed the information from the plaintiff company. It might be stated here that the respondent company (plaintiff) subsequently purchased the right of the auction purchaser in O.S. No. 72 of 1959. The plaint avers that to safeguard the interest of the plaintiff company it became necessary to negotiate with the decree holder auction purchaser in O.S. No. 72 of 1959 and the auction purchaser's right was taken for a sum of Rs. 9,500 on 10th June 1966 by taking a sale deed, the stamp paper for which itself came to Rs. 855. It is contended that inclusive of registration expenses, legal charges, brokerage, etc., a total sum of Rs. 2,500 was expended by the plaintiff company and the suit is hence brought for Rs. 12,855 claiming 6 per cent future interest on the same.

(3.) In the written statement filed by the defendant he took up the plea that the attachment before the judgment was obtained by the decree holder in O.S. No. 72 of 1959 of the Ernakulam Sub Court without proper notice to the defendant and the attachment was really invalid. A contract of sale, it is contended for by the defendant, was entered into under a bona fide impression that there was no attachment before judgment. The notice of attachment was subsequently found returned saying that the defendant refused to accept service of notice. When the decree holder had begun execution of the decree in the aforesaid matter the defendant requested the plaintiff to oppose the sale for which there were several legal grounds. It is the defendant's case that though plaintiff made an application for setting aside the sale, it was not pursued and the plaintiff company purchased the decree holder's right. According to him he had requested the plaintiff to reconvey the property to him on payment of Rs. 17,000 and expenses and the plaintiff refused to do so in order to secure the property at the rather very reduced price of Rs. 17,000. According to the defendant the plaintiff's loss could have been only the cash consideration paid. Even if the plaintiff did not purchase the property from the decree holder, he could have very well claimed right of subrogation, he having paid off the mortgage debt in O.S. No. 79 of 1961. The defendant asserts that even now he was prepared to pay back the plaintiff the amount of Rs. 17,000 and all lawful expenses if he will reconvey the property to the defendant. By amendment of the written statement the defendant took up the contention that the suit is barred by limitation.