LAWS(PVC)-1929-3-27

HARAN CHANDRA CHAKRAVARTI Vs. JOYCHAND

Decided On March 05, 1929
HARAN CHANDRA CHAKRAVARTI Appellant
V/S
JOYCHAND Respondents

JUDGEMENT

(1.) This is an appeal by a creditor who is described as creditor No. 4 against the order of the District Judge of Rajshahi dated 20 September 1927, made in an insolvency proceeding. The appellant had obtained a decree for over Rs. 5,000 on 16 July 1914. In 1915 he attached a house as belonging to his judgment-debtor, since adjudicated insolvent. Pour claim cases were started by the sons of the judgment-debtor who alleged that the property attached did not belong to the judgment-debtor but to themselves. Those claims were allowed on 23 August 1915 and the property released from attachment.

(2.) On 18 May 1916 the appellant brought a suit as provided under Order 21, Rule 63, Civil P.C. for a declaration that the property belonged to his judgment-debtor and not to the claimants. In this suit the claimants and the judgment-debtor were made defendants. The suit was decreed in the trial Court on 30 September 1921. The claimants appealed against that decree to this Court and the final decree of this Court was made on 22 March, 1921. In the meantime on 5 November 1921, the judgment-debtor was adjudicated insolvent and a receiver was appointed of his properties. The property which was the subject-matter of the suit brought by the appellant was not included in the schedule of the properties of the insolvent. The receiver did not take possession of the property nor did he take any interest in the litigation relating to that property. After the decree of the High Court setting aside the order releasing the property from attachment and declaring that the appellant could proceed in execution against the property in suit as belonging to his judgment-debtor, the insolvent judgment-debtor applied in the insolvency proceeding on 30 July 1924, for including the property in question in his schedule. After that date the receiver took possession of the property and proceeded to sell it. The present appeal arises out of an application made by the appellant that the whole of his decretal amount should be paid first out of the assets realized by sale of the disputed property on the ground that as the property was made available for the creditors of the judgment-debtor at his instance he was entitled to a first charge on the property. The argument was based upon the fact that the result of the decree in the suit brought by him was that the attachment that was effected in 1915 in execution of the appellant's decree was revived and it should be considered as having continued throughout and this attachment constituted a charge on the property. He is therefore entitled to preference to other creditors. The learned Judge rejected that contention holding it to be wholly untenable and that the appellant must rank equally with other unsecured creditors in the distribution of the assets. The appeal is against that order and the appellant claims that the whole of his dues should be paid first out of the assets realised by the sale of the property in question.

(3.) It is true that when on account of a claim being allowed under Order 21, Rule 60, Civil P.C, a property is released from attachment if the decree-holder brings a suit as provided under Order 21, Rule 63, and that suit is decided in his favour, the result is according to the authorities that the attachment is revived, although the property was released from attachment under Rule 60. The authority for this proposition is to be found in the cases of Bonomali Rai V/s. Prosonno Narain Choudhury [1896] 23 Cal. 829, Ram Chandra Marwari v. Mudheswar Singh [1906] 33 Cal. 1158, Protap Chandra Gope V/s. Sarat Chandra Gangopadhya A.I.R. 1921 Cal. 101 and Anthaya V/s. Manjaiya A.I.R. 1922 Mad. 176. It may, therefore, be held that the property was subject to attachment at the time when it was included in his schedule by the insolvent on 31 July 1924 and when the receiver took possession of it. But the effect of this attachment is surely not what appellant claims it to be. Attachment does not create any title in favour of the attaching creditor. It merely prevents private alienation: see the cases of Moti Lal V/s. Karrab-ul-din [1897] 25 Cal. 179 and Baghunath Das V/s. Sundar Das A.I.R. 1914 P.C. 129. The position of the appellant as an attaching creditor did not, therefore, confer any title upon him in the property in question and he is only entitled to be classed with other creditors all of whom are entitled to reteable distribution of the assets in the hands of the receiver. The rights of an executing creditor are defined in Section 51, Provincial Insolvency Act, which provides that where execution of a decree has issued against the property of a debtor, no person shall be entitled to the benefit of the execution against the receiver except in respect of assets realised in the course of the execution by sale or otherwise before the date of the admission of the petition. The appellant, therefore, has no higher right than that of any other unsecured creditor, and he is not entitled to have his decree satisfied in full out of the sale proceeds of the property attached by him.