D SUBRAMANIA AIYAR Vs. CHOKKALINGA MUDALIAR

JUDGEMENT

(1.) The facts of this case are as follows: One Chokalinga Mudali (called the first defendant) received a sum of Rs. 3,000 from one Kumaraswami Pillai. The latter died on the 29 June, 1917. The first defendant executed a promissory note for the Rs. 3,000 to Kumaraswami Pillai's son Sadasiva Pillai. There were many creditors of Sadasiva Pillai and suits were brought against him and several orders were passed in respect of this promissory note. Subramania Ayyar (called the plaintiff) is the receiver in one of those suits in which a decree was obtained against Sadasivam. In that suit an order was passed on the 31 July, 1917 attaching this promissory note. On the 20 August, 1917, a similar attachment was taken out by Kuppuswami Ayyangar (called the second defendant). There were various other attachments also, and, on the 18 March, 1918, the promissory note was endorsed by Sadasivam to Kuppuswami Ayyangar. The plaintiff now brings the suit to recover Rs. 3,000 from the maker of the note, and Kuppuswami Ayyangar, the second defendant in that suit has also filed a suit to recover the amount due under the promissory note. The lower Courts have found that there was no valid attachment of the promissory note and that the second defendant is a holder in due course and have consequently decreed the second defendant's suit and dismissed the plaintiff's suit. The plaintiff therefore appeals in both cases.

(2.) Under Order 21, Rule 51, the method of attaching a promissory note is by actual seizure and by bringing it into Court. Admittedly this has not been done with reference to the promissory note executed by the first defendant. The orders that were passed and said to, be orders of attachment but are really prohibitory orders that were addressed to Sadasivam Pillai and the first defendant forbidding them to receive or pay respectively, the amount due under the note. It does not appear from one execution petition of the 7 October, 1917 that an attempt was made to seize the note but it could not be found and an attachment was not effected.

(3.) It is now contended in appeal firstly, that the attachment was a valid attachment and that, therefore, the endorsement in favour of the second defendant was invalid and under Section 64 of the Civil Procedure Code is void as against the plaintiff's claim; and secondly that, even if the attachment is not a valid attachment, the second defendant has abused the process of the Court by getting an endorsement of the note after he had obtained the orders of the Court prohibiting the parties to the note from taking action thereon. As regards the first ground it is said that, although there was no attachment in the form prescribed for attachment of negotiable instruments, the prohibitory orders must be deemed to be attachment of the original book debt which has not been discharged by the promissory note The execution of a promissory note in satisfaction of a debt does not necessarily mean that the original debt is extinguished hut the note may operate as a substitute for that debt and the original debt is kept in abeyance pending the discharge or otherwise of the promissory note. It is, however, certainly open to parties to treat the original debt as discharged and substitute therefor the obligation under the promissory note, and, in this case, we have the finding of both the lower Courts that the book debt of Rs. 3,000 was discharged by the execution of the promissory note. This finding is based on the intention of the parties and consequently I do not think it is open to this Court in Second Appeal to interfere with that finding. We must take it therefore that the book debt had been discharged on the date of the prohibitory order, and consequently the procedure prescribed for the attachment of debts not secured by negotiable instruments is inapplicable to the present case. It is therefore quite clear that the attachment of the promissory note was not a valid attachment.