RANGO RAMCHANDRA KULKARNI Vs. GURLINGAPPA CHINNAPPA MUTHAL

JUDGEMENT

(1.) THE question for determination in this second appeal is whether the holder of a money decree, who has attached immoveable property of his judgment-debtor before judgment, can bring that property to sale in satisfaction of his decree when the judgment-debtor has, before the attachment, agreed to sell the property to a third party and the sale has been completed by a conveyance after the attachment. THE other facts which may be material in the particular case are that Rs. 1,500 out of the total consideration of Rs. 7,000 were paid at the time of the agreement, that possession was handed over to the purchaser at the same time, and that on the date of the sale-deed, which was executed two days after the attachment, Rs. 1,766 were paid to the vendor, the balance being retained by the purchaser in accordance with the agreement to satisfy certain mortgages on the property. THE decree-holder brought a suit for a declaration that the property was liable to be attached and sold in execution, of his decree, and both the lower Courts have held in his favour. THE purchaser from the judgment-debtor has appealed.

(2.) THE following provisions of law have to be considered in connection with the question:--Section 64, Order XXI, Rule 54, and Order XXXVIII, Rule 10, of the Civil Procedure Code, and Sub-section 40 and 54 of the Transfer of Property Act. Section 64 and Order XXI, Rule 54, might seem at first sight to make the rights of the purchaser under the sale-deed subject to the rights of the attaching judgment-creditor, but these provisions must be read along with Order XXXVIII, Rule 1 0. That rule saves the right of the purchaser under the contract of sale. His right is a personal one, i.e. the right to a conveyance in his favour on payment of the balance of the purchase-money. But there is nothing in the rule to suggest that it applies only to rights in rem. By reason of Section 40 of the Transfer of Property Act the purchaser may enforce his vendor's obligation under the contract of sale against a transferee with notice. Section 54 of the Act states that a contract for the sale of immoveable property does not, in itself, create any interest in or charge on such property. But the attachment does not create any interest or charge either. In this respect the attaching creditor is in no better position than the purchaser, and simply on the construction of the statutory provisions it is difficult to see how his attachment can confer upon him any higher right than the judgment-debtor had at the date of the attachment, namely, a right to the balance of the purchase-money, this right being subject to the obligation to convey the property to the purchaser. THE claim by the attaching creditor to sell the property in execution of his decree would override both the obligation of the judgment-debtor and the right of the purchaser existing prior to the attachment.

(3.) IT has been held in several cases in Madras, Veeraraghavayya v. Kamala Devi (1934) 68 M.L.J. 67, Veerappa Thevar v. Venkatarama Ayyar (1935) I.L.R. 59 Mad. 1, and Diraviyam v. Veernan [1939] Mad. 853, 863, that the attachment before judgment of property subject to a contract of sale merely gives the attaching creditor a right to the balance of the purchase-money. With respect I agree with this view. IT necessarily follows that he can never sell the property in satisfaction of his own decree. If the purchase-money or the balance thereof has not been paid, he can attach it in the hands of the purchaser. He would also in that case have the benefit of the vendor's lien under Section 55(4) (b) of the Transfer of Property Act (see Veerappa Thevar v.. Venkatarama Ayyar (1905) I.L.R. 59 Mad. 1, 4), and he could, if necessary, sue to enforce it. If the whole of the price has been paid to the vendor, the attaching creditor's only right would seem to be to attach the money in the hands of the vendor, if he can. In most cases he will not be able to do so, and the attachment will then be in fructuous, for although by reason of the attachment the attaching creditor will become entitled to whatever part of the purchase-money has been paid after the attachment, the attachment itself will not enable him to enforce that right. That is the position in the present case, for the balance of the purchase-money, which was payable to the vendor, was paid on the date of the sale-deed.