MAXHEMEIJER JR. (INDIA) PRIVATE LIMITED, REPRESENTED BY ITS MANAGING DIRECTOR MAJOR S. A. HAKEEM Vs. ZAINUB BI, DAUGHTER OF LATE HAJI M. S. MOHAMED IBRAHIM SAHIB

JUDGEMENT

(1.) THE first defendant in O.S. No. 107 of 1965 on the file of the Court of the Subordinate Judge, Chingleput, is the appellant herein. Admittedly the suit property of an extent of 3.06 acres belonged to the partnership by name Haji M. Shaik Abdul Kader, M. S. Abdul Rahiman and Company, consisting of two partners Haji M. S. Abdul Rahiman Sahib and Haji M. S. Adam Mohideen Sahib. Haji M. S. Abdul Rahiman Sahib died on 30th April, 1958 leaving behind defendants 2 to 7 as his heirs and legal representatives. Haji M. S. Adam Mohideen Sahib died on 12th March, 1955 leaving behind defendants 8 to 13 and one Hablbma, who is not a party to these proceedings, as heirs and legal representatives. The first respondent herein claiming to have entrusted her jewels and liquid cash with the said partnership took proceedings for recovery of the same from defendants 2 to 13 herein out of the assets of the partnership in their hands. She filed a petition O.P. No. 295 of 1958, on the file of the City Civil Court, Madras represented by her son and next friend, as she was of resound mind then. The said O.P. prayed for permission of the Court to institute a suit in Jorma pauperis. Subsequently it was transferred to this Court and numbered as C. S. No. 119 of 1960. Pending that suit, the first respondent obtained on 11th July, 1961 an order of attachment of the suit property as well as another item of property in Application No. 1104 of 1961. However, it is admitted that the attachment was not effected. A decree in favour of the first respondent was passed by this Court for a sum of Rs. 29,130 on 24th November, 1961. Meanwhile, under Exhibit B -18 dated 5th June, 1961 the appellant herein entered into an agreement with defendants 2 to 13 for the purchase of the suit property for a consideration of Rs. 40,000. One of the debts for the discharge of which the suit property was agreed to be sold by defendants 2 to 13 was a debt in favour of the Eastern Bank Limited, Madras, and this fact was mentioned in Exhibit B -18 itself, even though the amount due to the Eastern Bank was not actually specified. Under the original of Exhibit B -19 dated 7th July, 1961, the appellant herein obtained an assignment of the decree in favour of the Eastern Bank Limited, for a consideration of Rs. 10,243 -73. Thereafter, the appellant purchased the suit property under two sale -deeds, the originals of Exhibit B -2 dated 10th August, 1961 executed by defendants 3 to 13 and Exhibit B -3 dated 12th January, 1962 executed by the second defendant. With regard to the share of Habibma, the appellant executed the decree in favour of the Eastern Bank Limited, Madras, assigned in its favour under the original of Exhibit B -19, and purchased her share in the suit property, in Court -auction. Nearly three years after these sales, the present suit was instituted by the first respondent herein for the following reliefs:

(2.) THE learned Principal Subordinate Judge, on a consideration of the materials placed before him, held on the principal issues against the appellant herein. With regard to issue No. 1, his finding was that the first defendant was aware of the suit, C. S. No. 119 of 1960 and the attachment application No. 1104 of 1961 in respect of the suit property prior to its purchase. His answers to issues Nos. 2 and 3 were in the affirmative. On issue No. 4 he held that the suit was not barred by limitation. On additional issue No. 1, he did not go into details, in view of his conclusion that the first respondent was entitled to have the sales under the originals of Exhibits B -2 and B -3 declared void and inoperative and not binding on her. However, he held that if she were to fail in her main prayer for setting aside the two sales referred to above, she will be entitled to damages as against the appellant on his finding that the appellant's Managing Director D.W. 1, had colluded with defendants 2 to 13 and had caused loss to the first respondent, depriving her of the fruits of her decree in. C. S. No. 119 of 1960 by purchasing the suit property for a low price on account of such collusion and fraud. With regard to additional issue No. 2, the finding of the learned Principal Subordinate Judge was that the alternative claim for damages was maintainable. On additional issue No. 3, the finding was that the suit was. not barred by limitation and as a matter of fact that question was not argued by the Counsel for the contesting defendants before him. In view of these findings, by his judgment and decree dated 31st March, 1967, the learned Principal Subordinate Judge decreed the suit with costs, granting a declaration that the sale deeds dated 10th August, 1961 and 12th January, 1962, were invalid and inoperative as against the plaintiff (first respondent) and setting aside the said sales. However, he dismissed the prayer, for an injunction against the appellant herein. It is against this judgment and. decree that the first defendant in the suit has preferred the present appeal.

(3.) THE suit instituted by a creditor under this section to avoid a transfer on the ground mentioned in the section shall be instituted on behalf of or for the benefit of all the creditors.