PICHA MOOPPANAR Vs. VELU PILLAI

JUDGEMENT

(1.) The appellant in this second appeal filed Small Cause Suit No. 644 of 1940 in the Court of the District Munsiff of Ambasamudram against one Krishna Pillai on a promissory note executed by him and obtained a decree. The appellant sought to execute his decree by attaching the properties set out in the schedule appended to the present plaint. The first defendant in this suit who is the first respondent in the second appeal filed a claim petition objecting to the attachment on the ground that the suit property fell to his share in a family partition entered into between Krishna Pillai his father, himself and his brother Arumugham Pillai who is the second defendant in the present suit and the second respondent in the second appeal. The claim petition was allowed and the attachment was raised. The appellant thereupon filed the suit out of which this second appeal has arisen alleging that the partition relied upon by the first defendant was entered into with intent to defraud the creditors of Krishna Pillai. The suit was filed by the plaintiff on behalf of himself and the other creditors of Krishna Pillai. No objection to the frame of the suit can therefore be taken and if the plaintiff establishes that the partition was fraudulent as he alleged, he would be entitled to relief to the extent stated below. The District Munsiff of Ambas samudram who tried the present suit dismissed it holding that the plaintiff did not succeed in making out that the partition in question was in fraud of the creditors of Krishna Pillai. This judgment was affirmed by the Subordinate Judge of Tinnevelly.

(2.) In this second appeal filed by the plaintiff his advocate Mr. T. L. Venkatarama. Aiyar has argued that the findings of the Courts below in regard to the character of the partition cannot be sustained as the matter was not viewed from the proper legal standpoint by either Court. He contends that according to the latest pronouncement of our Court in the case in K. S. RM. Firm V/s. Subbiah (1944) 1 M.L.J. 384 : I.L.R. 1945 Mad. 138: If a partition is unequal and the father is allotted a smaller share than would be his due with i ntent to defeat the creditors, the latter can avoid the partition under Section 53 of the Transfer of Property Act and proceed against what would be his proper share in the family properties in execution of the decree obtained against him ignoring the allotment of the properties at the partition. Whatever doubts might have existed in regard to the complicated positions which arise in cases where partitions are effected between a Hindu father and his sons at a time when the father is indebted, all those doubts must, in my opinion, be said to have been cleared by the decision I have just referred to. If I may say so with respect, the enunciation of the law by Wadsworth and Patanjali Sastri, JJ., in that decision in the form of certain propositions of law has elucidated and defined the rights of creditors as against their debtors and their sons. That decision fully supports the contention raised on behalf of the appellant. The particular proposition on which Mr. Venkatarama Ayyar relies is set down as paragraph (a) on page 146 in the I.L.R. Vol. It is unnecessary to set it out here, as I have already indicated its scope and effect.

(3.) So far as the findings of the Courts below are concerned, it seems to me that both Courts failed to look at the transaction from the proper legal standpoint. The question which they should have put to themselves is whether sufficient property was allotted to the father with which he could discharge his debts. The manner in which the Courts below viewed the matter is this. They asked themselves whether the property that was allotted to the first defendant was sufficient for the discharge of the debts which he had undertaken to discharge and similarly with regard to the second defendant also. Putting this question to themselves, they held that the debts which each of the defendants was called upon or had undertaken to discharge were less than the properties which had been allotted to each of them. This misses the real point altogether. Looking at the question from the standpoint I have indicated, I have no doubt in my mind that the partition evidenced by Ex. D-1 must be held to be a fraudulent partition within the meaning of proposition (a) enunciated by Wadsworth and Patanjali Sastri, JJ., in the case already referred to. It is unnecessary to set out at length the terms of the partition deed. No property was allotted to the father, as small provision for his maintenance was made, each of the sons being directed to deliver to him a small quantity of paddy every year and make a small cash payment. A similar provision was also made for the maintenance of the mother. All the properties were divided between first and second defendants. It is true that all the debts of the father were distributed between the first and second defendants, the second defendant being directed to pay something more than half the debts, the inequality being explained by the fact that the second defendant took a house which was slightly larger in value than the house which was allotted to the first defendant. While the debts of the father were mentioned in the partition deed and while the first defendant cr the second defendant was directed to pay them off. it seems to me that this provision is absolutely illusory as no creditor can take advantage of what is binding only as between the first and second defendants. Creditors are not parties to the contract embodied in the partition deed and if the concerned defendant refuses to discharge a debt which he is directed to pay under Ex. D-1, I dc not see how he can be compelled at the instance of the creditor to discharge it by reason of the fact that the debt is by the partition deed directed to be paid by that defendant. In deciding whether the partition is not fraudulent in the sense I have indicated, we have only got to look at the effect which this partition deed would have on the rights of creditors and so viewed the partition must be held to have been entered into with a view to defraud the creditors of Krishna Pillai. Mr. Venkateswara Aiyar the advocate for the first respondent argued that the propositions enunciated by Wadsworth and Patanjali Sastri, JJ., are obiter dicta as there is a finding recorded by them lower down in their judgment that the partition which was effected in that case was not unequal. I am not sure that they are obiter but even so, I am inclined to agree with those observations which, as I already stated, not only state precisely the legal position which arises in cases of this description, but also give the necessary protection to creditors against fraudulent partitions.