Anand Priay v. Abdullah — 1965 DIGILAW 328 (ALL)

JUDGMENT S.S. Dhavan, J. - This is a decree-holders second appeal from the concurrent decisions of the courts below decreeing the objectors' suit for a declaration that a plot of land is his property and therefore not liable to attachment in execution of the decree obtained by the defendant, and directing the release of the plot. The appeal raises several important questions of law involved the interpretation of the word "conclusive" in rule 63 of Order XXI of the Code of Civil Procedure. On some of these questions there is a conflict of opinion between the High Courts and even between the different Benches of the same High Court. 2. The facts are these. On 17th August, 1954 the defendant-appellant Anand Priya filed a suit for the recovery of a sum of Rs. 4,0001- against two persons, Aladiya and Abdul Majid, and on the same day he applied for the attachment before judgment of certain properties belonging to Aladiya, one of the defendants. On 18th August, one day after the filing of the suit-Aladiya sold the property to Abdullah, the plaintiff-respondent in this appeal for Rs. 5001-under a sale deed which was registered on the 28th August, 1954. As the property was already mortgaged by Aladiya to his brother-in-law, one Ishtiaque Husain, the latter also signed the sale deed agreeing to relinquish his security in consideration of half the sale price. On 27th August, the court heard the application for attachment before judgment and ordered attachment. Thereupon, the alleged purchaser Abdullah (the plaintiff-respondent in this appeal) filed an objection under Order XXI, rule 58, C. P. C. on the ground that the property belonged to him and could not be attached, and asked for its release. The plaintiff in that suit Anand Priya, the present appellant-contended that the sale deed in favour of Abdullah was fictitious and executed with the object of defrauding the creditors of Aladiya. On 10th October, 1955 the execution court held that the sale was fictitious and fraudulent and the objector was not in possession of the property, and dis-missed the objection. The objector filed no suit under Order XXI, rule 63 to establish his title to the property, and the order of 10th October, 1955 became conclusive as provided under Rule 63. The property remained attached till 16th January, 1958 when the execution proceedings were struck off in part satisfaction of the decree. The objector filed no suit under Order XXI, rule 63 to establish his title to the property, and the order of 10th October, 1955 became conclusive as provided under Rule 63. The property remained attached till 16th January, 1958 when the execution proceedings were struck off in part satisfaction of the decree. Shortly afterwards, in 1958, the decree-holder filed another application for execution and got this property attached once again. The plaintiff-respondent Abdullah did not file any objection against the second attachment, but on 17th October, 1959 he filed the present suit for a declaration of his title to this property and to its release from attachment. 3. The decree-holder the appellant before me resisted the suit and contended once again that the sale on which the plaintiff (in that suit) based his title was fictitious and fraudulent. He also contended that the order of 10th October, 1955 rejecting Abdullah's objection had become conclusive, and the decision operated as res judicata in this suit. He also pleaded that the suit was time barred under article 11 of the Limitation Act. 4. The trial court held that the order of 10th October, 1955 was conclusive only for the purpose of the earlier attachment proceedings, but not the subsequent proceedings which arose out of a fresh attachment. It also held that the suit was maintainable and not barred under Order XXI, rule 63, C. P. C. or Article 11 of the Limitation Act. On merits it held that the sale was not fictitious and the plaintiff Abullah was the owner in possession of the property in dispute. Accordingly it decreed the suit. On appeal the learned Additional Civil Judge agreed with the trial court. He observed that the first attachment of the property ceased automatically when the earlier execution case was dismissed and therefore there was no necessity for the plaintiff Abdullah to file a suit under Order XXI, rule 63, C. P. C., but the fresh attachment in 1951 gave him afresh cause of action and he could file a suit for a declaration of his title. He observed, "ofter the property was re-attached, the plaintiff-respondent got a right to file objections again because of the fact that it had no longer remained necessary for him to file a suit under Order XXI rule 63 C. P. C. and once his objection under Order XXI rule 63 were dismissed he could file a regular suit". I must state at this very stage that this observation does not state the facts correctly, for the plaintiff-respondent Abdullah filed no objection against the second attachment and the question of his objection being rejected never arose. On merits the learned Judge agreed with the trial court that the sale in favour of Abdullah was not fictitious and he had become the owner of the property, and he dismissed the appeal. The defendant has come to this Court in second appeal. 5. The case for the appellant was argued by Mr. A. N. Varma and for the respondents by Mr. H. N. Seth. Both counsel argued their respective cases with great ability and the court is obliged to them for giving valuable assistance in a matter on which there is a conflict of decisions. Mr. Varma urged the following point in support of the appeal. First, he contended that the order of 10th October 1955 dismissing the plaintiff-respondent's objection against the earlier attachment became conclusive when he failed to file a suit under Order XXI, rule 63, C. P. C. within the prescribed period, and consequently he cannot be permitted to agitate the same question in the present suit. Secondly, the finding in the earlier objection proceedings that the sale was fictitious operates as res judicata in this suit. Thirdly, this suit having been filed more than a year after the order dismissing the plaintiff-respondent's objections, is time barred. Lastly, the plaintiff respondent acquired no right to file this suit as he did not file objections against the present attachment and consequently the suit is not maintainable. 6. In reply Mr. H. N. Seth contended that the order of 10th October 1955 dis-missing the plaintiff-respondent's objection was conclusive only for the purpose of the earlier attachment proceedings, and ceased to operate when the execution was struck off; consequently there was no cause of action left for the plaintiff to file a suit under Order XXI rule 63 C. P. C. and he was under no obligation to file it. Secondly, as the order itself became inoperative its conclusiveness also came to an end, and it cannot operate as res judicata in the present suit. Thirdly, the suit is not time barred as it was filed within 12 years of the earlier order dismissing his objections, and within 12 years of the present attachment. 7. At the outset I make it clear that the principle of law enunciated in this judgment is confined to the precise facts of this case, which are as follows: (1) an objection to the attachment in execution of a decree is dismissed; (2) the objector files no suit to establish his right to the property; (3) the attachment remained in force for more than two years; (4) the attachment came to an end on the execution being struck off; (5) the decree-holder obtained a fresh attachment of the same property in execution of the same decree; (6) the objector filed no objection against the second attachment; (7) instead he filed a suit for a declaration of his title to the property on the same grounds as in the objection to the first attachment which were rejected; 8. Three questions arise in this case; 1. Does the earlier order of 18th August, 1954 rejecting the plaintiff-respondents' objection on the ground that the sale of the property in his favour was not genuine operate as res judicata in the present suit? 2. Is the plaintiff's right to file this suit barred by rule 63 of Order 21, C. P. C. which provides that the order rejecting the objections shall be conclusive? 3. Is this suit time barred under Article 11 of the Limitation Act? 9. It is necessary to refer briefly to the relevant provisions of the Code of Civil Procedure governing the rights of a person who files an objection against the attachment of any property in the execution of a decree which are as follows. Section 47 confers on the execution court an exclusive jurisdiction to determine all questions relating to the execution, discharge, or satisfaction of the decree. The policy underlying this provision is to expedite the proceedings of execution, for it is notorious that in India the troubles of a decree-holder begin after he obtains the decree. Section 47 confers on the execution court an exclusive jurisdiction to determine all questions relating to the execution, discharge, or satisfaction of the decree. The policy underlying this provision is to expedite the proceedings of execution, for it is notorious that in India the troubles of a decree-holder begin after he obtains the decree. The question whether any particular property is liable to be attached is one which is within the jurisdiction of the execution court Nirodh v. Haretzdra, 42 C.W.N. 87. 10. But the Code provides adequate safeguards against any attachment of property not belonging to the judgment-debtor. Rule 58 of Order 21 confers on any person the right to file an objection to the attachment of any property on the ground that it is not liable to attachment, and makes it compulsory for the court to investigate the objection. Rule 59 restricts the right to file an objection to a person who can show that at the time of attachment he had some interest in the property attached or was possessed of it. It bars objections by a busybodies who have no interest in the property, or by a step of the judgment debtor acting in collusion with him. Rule 60 provides in effect that the court shall make an order releasing the property from attachment if it is satisfied that at the time of attachment the property was not in the possession of the judgement-debtor. (This is a very brief summary of the rule) . Rule 61 provides in effect that the court shall disallow the claim to the attached property if it is satisfied that at the time of attachment it was in the possession of judgment-debtor as his own property (This too is a brief and somewhat inadequate summary of the rule) . Rule 62 deals with the claim of a mortgagee to the attached property and is not material for the present controversy. Lastly there is rule 63. It is necessary to quote this rule in full: 11. Rule 63 : Saving of suits to establish right to attached property: Where a claim or an objection is preferred, the party against whom an order is made may institute a suit to establish the right which he claims to the property in dispute, but, subject to the result of such suit, if any, the order shall be conclusive. 12. Rule 63 : Saving of suits to establish right to attached property: Where a claim or an objection is preferred, the party against whom an order is made may institute a suit to establish the right which he claims to the property in dispute, but, subject to the result of such suit, if any, the order shall be conclusive. 12. The decision of this case turns on the meaning and scope of the word "conclusive". Its ordinary meaning is fairly simple, but its interpretation has been tied up in judicial knots by the decisions of different High Courts which are not easy to reconcile and some of which I say this with great respect are self-contradictory. Many of them were cited at the bar. It appears to me that each case made its decision according to its view of what was equitable and then interpreted the word "conclusive" to fit in with its decision, regardless of whether interpretation was permitted by the language of the statute. The judicial history of the word "conclusive" in rule 63 is an illustration of the consequences of the courts 4 wandering from their orbit of interpretation into that of legislation. The plain meaning of the statute was discarded in favour of the subjective interpretation of the Judge concerned who was guided by what he considered to be the equities of the case before him. By way of illustration, a Full Bench of this Court has taken the view that the order is "conclusive" during the continuance of the attachment proceedings for one year after the order, and if attachment terminates within a period of one year, the order ceases to be conclusive. Habibullait v. Mahmood, A.I.R. 1934 Alld. 267 (F.B.) But the Patna High Court has held that the conclusiveness is confined to the execution proceedings in which the order was passed and if the proceedings come to an end the conclusiveness also disappears and it is immaterial whether the attachment ceases within a year of the order or not. Ram Chandra Singh v. Mst. Khodajatul, AIR 1945 Patna 369. But the Madras High Court has held that the order is conclusive for the purpose of the execution of the particular decree in which it was made. Thus Allahabad has confined the word "conclusive" to the particular attachment, Patna to the particular execution, Madras to the particular decree. 13. Ram Chandra Singh v. Mst. Khodajatul, AIR 1945 Patna 369. But the Madras High Court has held that the order is conclusive for the purpose of the execution of the particular decree in which it was made. Thus Allahabad has confined the word "conclusive" to the particular attachment, Patna to the particular execution, Madras to the particular decree. 13. In Habibullah v. Mahmood, A.I.R. 1934 Alld. 267 (F.B.) the question whether the conclusiveness of the order disappears if the attachment ceases within a year of the order was referred to a Full Bench. The Division Bench which made the reference expressed their doubts about the correctness of the previous interpretations of the word conclusive, and observed: "Convenience is not a clear and cogent reason for reading a particular rule of law in a particular manner, especially where the language of the law is clear and admits of no exception. Rule 63 says in most clear terms that the decision in the claim or objection case shall be conclusive, subject to only one provision, namely, the result of a suit instituted within one year of the decision. It nowhere says that there is a further exception, namely, the dismissal of the execution application for default and the withdrawal of the attachment." 14. The Full Bench to which the question was not referred did not dissent from with these observations. Suleman, C. J. observed: "It seems to me that the language is certainly ambiguous and there is much to be said fox either of these three views. But the fact remains that this language has remained in the Code since 1882 and the Legislature in 1908 retained that word and re-adopted the old phraseology. It also cannot be disputed that the decisions in all the High Courts are unanimous on one point, namely, that if a claimants objection has been dismissed by the execution court and before the time for filing the suit has expired the attachment is withdrawn and no longer subsists, it is not incumbent on him to file the suit and that if the decree-holder reattaches the property afresh it would be open to the judgment-debtor to re-agitate the question or, at any rate, to bring a fresh suit for a declaration of title within one year of a fresh attachment. 15. 15. Mukerji, J. observed: "If the interpretation of Order XXI, Rule 63 were a matter was integra I would unhesitating) have come to the conclusion that the conclusiveness of the order passed under Order XXI, Rule 63 exists as between the decree-holder and his representatives on the one hand and the claimant and his representatives on the other till the decree is satisfied and it would be immaterial whether the execution proceedings under which the attachment is obtained or for the time being dismissed for default and the attachment is withdrawn. Indeed, I think, I could say much on the point in support of the view which I was inclined to take. Some of my grounds are given in the joint order of myself and my brother who agreed to refer the case to a Full Bench. But, as has been pointed out by my lord the Chief Justice, the interpretation that has been given to the rule has been one way in all the courts, and for a long period of time. Many per-sons on the faith of those rulings may have been advised to file a suit and if we hold otherwise today they might suffer loss and their loss may be irreparable. It is therefore necessary to stick to the interpretation which has been almost uniformly given, in the interest of public at large, because it is for the interest of public that the law exists." 16. King, J. observed: "I agree with my learned brother that there is some difficulty in reconciling judicial opinion on this point with the language of Order XXI, Rule 63 but as the courts have been unanimous in their views for so many years, I think that on the principle of stare decisis we should answer the first question in the negative and the second in the affirmative. "Thus all the three judges of the Full Bench virtually admitted that the restricted interpretation of the word "conclusive" in Rule 63 was not justified by the. language of the statute, but must be accepted to present injustice in many cases. With the utmost respect, fear of injustice may be a good consideration for the legislature for amending the law with retrospective effect, but not for the Courts for misinterpreting the plain language of a statute. 17. The principle laid down by the Full Bench in Habibullah v. Mahmood, A.I.R. 1934 Alld. With the utmost respect, fear of injustice may be a good consideration for the legislature for amending the law with retrospective effect, but not for the Courts for misinterpreting the plain language of a statute. 17. The principle laid down by the Full Bench in Habibullah v. Mahmood, A.I.R. 1934 Alld. 267 (F.B.) is of no help to the plaintiff respondent in the present case for two reasons. First, it applies under one conditionnamely, that the attachment must have ceased to exist within a year of the date of the order in the claim case. In this case, the attachment continued for two and a half years and during this period the objector filed no suit to establish his title to the property as provided under Rule 63. His right to file the suit became time barred, and the order dismissing the objection became conclusive. Secondly, the Full Bench left open the question of res judicata. Suleman, C. J. observed: "It seems to me necessary to express any final opinion as to whether, if an order is passed against the decree-holder releasing the property from attachment and the decree-holder voluntarily gets his own application dismissed, he would still be entitled to re-agitate the question on filing a fresh application for execution. It may well be that although there is bar under this rule (rule 63) there is a bar on account of some general principle of res judicata or on the ground that the cause of action in favour of the decree-holder arose out of the release of the property which continues just in the same way whether the application is pending or is not pending. it is possible to hold that there is a distinction between the position of a claimant and a decree-holder inasmuch as the position of a claimant is improved if the attachment ceases after the order is passed, whereas the position of the decree-holder is in no way altered merely because the application for execution is dismissed. In that view he must sue even if his attachment is gone." With respect to this observation I must add to it this qualification that if a judgment or decision is to operate as res judicata it must operate against both the parties to She dispute. I know of no principle of law by which it can operate against one. 18. I know of no principle of law by which it can operate against one. 18. I think the question which has arisen in the present case must be decided according to an earlier decision of a Full Bench of five judges in Badri Pd. v. Mohd. Yusuf, I.L.R. 1 All. 381 That case was governed by Section 246 of the old Code, the provisions of which are similar to rule 63 of the present Code. The facts of the case were these. One Imamuddin claimed a half share in a grove near Aligarh, the other half being claimed by one Rahim Bux. Imamuddin got his name entered in the revenue records as half share of the grove. Subsequently Imamuddin's half share was attached in execution of a decree against him. Rahim Bux filed an objection before the execution court under Section 246 of the old Act (Act VIII of 1859) . He claimed the whole interest in the grove and denied that Imamuddin had any right to any portion of the property or was in possession of any part of it. The execution court on 30th April, 1817 rejected Rahim Bux's objection, and the half share of the judgment-debtor was put to sale and purchased by one Badri Prasad. He was put in possession after confirmation of the sale on 4th July, 1870. Subsequently a decree was passed against Rahim Bux and the decree-holder attached his rights in the whole grove in execution of his decree. These rights were purchased at a court sale by the defendants Mohammad Yusuf and another. Badri Pd. petitioned the execution court that he had been put in possession as auction purchaser of Imamuddin's half share in the grove under a court certificate. The Munsif passed an order recording that Badri Pd.'s possession by right of purchase of Imamuddin's share was in no way affected by the subsequent purchase of the alleged rights of Rahim Bux, but the defendants somehow succeeded in persuading the Settlement Officer to record their actual possession over the whole grove. Thereupon Badri Pd. filed a suit in the Munsirs court to establish his right to possession of half the area of the grove. The defendants resisted the suit, but the plaintiff Badri Pd. Thereupon Badri Pd. filed a suit in the Munsirs court to establish his right to possession of half the area of the grove. The defendants resisted the suit, but the plaintiff Badri Pd. contended that the order of 30th April 1870 rejecting the objection of Rahim Bux was final and conclusive, unless set aside in a regular suit brought with in a car by Rahim Bux and his representative, and as no such suit had been filed it was not open to the defendants to question the adjudication of the rights involved in the aforesaid order, as between the parties to Badri Pd.'s suit. The question raised by the plaintiff's plea was referred to a Bench of five judges. It was held by four judges that an order passed under Section 246, unless over-ruled in a regular suit brought within the statutory period, was binding on all persons who were parties to it and conclusive. They further held that as the objection of Rahim Bux had been disallowed and the property in dispute adjudged to be that of the judgment-debtor in the earlier execution proceedings and neither Rahim Bux nor his representative had filed a suit within one year to set aside the order disallowing his objection, the defendants as representatives of Rahim Bux could not be permitted to raise the same question in the suit. The learned Judges observed: "Now it appears to us that when an enquiry had been duly held under Section 246 and an order passed thereon, so long as the order remains unquestioned by the procedure directed in the Code it is as final and conclusive on all persons who are parties to it, as any other final order or decree of a court of justice. Until it had been over-ruled in a regular suit brought in virtues of the permission expressly given by the Code, no court is at liberty afterwards to go behind the order, and enquire whether the court, which disallowed the objection, had correctly appreciated the evidence as to possession, or had come to the conclusion erroneously that possession was with the judgment debtor." 19. They further observed: "It appears not unreasonable that to give some little security to the titles which in this country are exposed to much peril, as regards titles derived from auction sales in execution of a decree, the legislature should have required any person who makes a claim to attach property, to come in within a limited time, and vindicate his rights if he had any one, or thereafter to be barred from ascertaining them." 20. The fifth Judge, Pearson J. wrote a separate judgment and held that an order under Section 246 was not so absolutely res judicata as not to be open to re-adjudication in a suit brought by the parties against whom it was passed to establish his right, but he further observed that "in the event of no such suit being brought the matter in dispute must be held to have been finally disposed of by the finding and the order under Section 246, and to be absolutely res judicata. 21. In my opinion the principle laid down in Badri Prasad v. Mohd. Yusuf, I.L.R. All. 381 must govern the decision in the present case. The plaintiff respondent Abdullah filed an objection against the attachment of the land in dispute on the ground that he was its owner by purchase and the judgment debtor was not in possession. The execution court, after a summary investigation, held that the sale in his favour was a bogus and fraudulent transaction and his possession had not been established, and dismissed the objection. Abdullah had a right to file a suit within a year of the passing of the order, but he did not, and therefore the order became conclusive. As the attach. meat continued throughout this period of one of the opinion of the Full Bench in Habibullah v. Mahnzood, A.I.R. 1934 Alld. 267 (F.B.) has no application. 22. Moreover, the present suit is barred by the principle of prangnyaya (res judicata). As stated above the question whether this principle applies to an order rejecting an objection was left open by the Full Bench in Habibullah v. Mahmood, A.I.R. 1934 Alld. 267 (F.B.). In fact Suleman, C. J. was inclined to the view that in certain circumstances the decree-holder who does not file a suit against an order allowing an objection might be defeated by the plea of res judicata. 267 (F.B.). In fact Suleman, C. J. was inclined to the view that in certain circumstances the decree-holder who does not file a suit against an order allowing an objection might be defeated by the plea of res judicata. If the principle of res judicata is not applied to an order rejecting or allowing an objection, it would lead to strange results. Suppose the decree-holder attaches the house of A in an execution of a decree against B, and A proves to the hilt that he purchased the house bona fide and for value, and his objection is allowed by the Court and the house released from attachment. The decree-holder, unless estopped by the principle of res judicata, can defeat this decision by getting his execution application dismissed for default and then filing a fresh application on the ground that the earlier attachment had come to an end, and with it the conclusiveness of the order. The objector will then be compelled to lead the same evidence all over again -to establish his claim to the property. In the event of the second order also being against the decree-holder, he can defeat it in the same way by getting his second application dismissed and filing a third application for execution. This possibility was considered in its referring order by the Division Bench in Habibullah v. Mahmood, A.I.R. 1934 Alld. 267 (F.B.). 23. In my opinion an order rejecting or allowing a claim operates as res judicata between the objector and the decree-holder in any subsequent attachment in execution of the same decree. The qualification laid down by the Full Bench in Habibullah v. Mahmood, A.I.R. 1934 Alld. 267 (F.B.) does not apply in the present case, as the attachment continued throughout the period of limitation and the order became conclusive before the attachment was struck off. 24. This appeal is allowed with costs, the decree of the court below reversed and the plaintiff-respondent's suit dismissed with costs throughout. 25. The formal order allowing the appeal was passed on the 23rd of August, 1965 but I observed that the reasons would be delivered in court later. This order contains the masons for the decision Appeal allowed.