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2019 DIGILAW 1054 (KER)

Fousiya D/o. Kunhimarakkar v. Rajula D/o. Koya Moideen

2019-12-11

K.HARILAL, T.V.ANILKUMAR

body2019
JUDGMENT : T.V.ANILKUMAR, J. 1. This appeal is filed by the claim petitioner in O.P.No.670 of 2009 before the Family Court, Kozhikode, challenging dismissal of her claim seeking to lift attachment before judgment made in respect of 2.83 cents of land allegedly owned by her. 2. She claimed to be the owner of the aforesaid petition B schedule 2.83 cents of land in re-survey No.59/1 of Meenchanda Village acquired as per document No.1910/2009 dated 12.7.2009 of Meenachanda Sub Registry executed in her favour even before the institution of the original petition. It is an admitted fact that she purchased the property before the institution of the original petition. 3. The original petition was filed by the 1st respondent in the claim petition who is the wife of the 4th respondent. The parties are Mohamadans. Respondents 2 and 3 are the minor children born to the spouses. The claim made in the original petition was for an order for recovery of arrears of past maintenance from the father. The claim petitioner is admittedly his sister. 4. According to the claim petitioner, she is a bona fide purchaser for value without notice of the purported claim of minor children in respect of the property. According to her, the attachment before judgment needed to be lifted since she was not a party to the original petition and further, she had acquired prior interest in the petition B schedule property before the date of issue of attachment itself. Therefore, invoking the provisions under Order XXXVIII Rule 8 read with Order XXI Rule 58 of the Code of Civil Procedure, 1908 (for short, 'the CPC' only), she sought to lift the order of attachment and communicate the same to the concerned Sub Registry. 5. The 4th respondent/the brother did not contest the proceedings. His wife and children who are respondents 1 to 3 filed counter statement, seeking to sustain the order of attachment alleging that document No.1910/2009 was sham and fraudulently created. It was contended that the document in her name was executed without consideration and with the sole object of defeating the rights of the minor children to recover arrears of maintenance by proceeding against the petition B schedule property. The substance of their contention is that the creation of document No.1910/2009 was the result of collusion between brother and sister. 6. No evidence was adduced before the Family Court by either parties. The substance of their contention is that the creation of document No.1910/2009 was the result of collusion between brother and sister. 6. No evidence was adduced before the Family Court by either parties. The document No.19/2009 dated 12.7.2009 in the name of claim petitioner alone was available on record before the court when the impugned order dated 3.9.2013 was passed in I.A.No.989/2012 in the original petition. 7. The court below having regard to the contentions raised by the parties before it, held that the transaction was fraudulent. It was held to be a sham transaction brought into existence at the instance of the 4th respondent in collusion with the claim petitioner. 8. The claim petitioner is seriously aggrieved by the decision of the court below. She contended that she is a purchaser in good faith and she came to know of the attachment only when she proposed to arrange for mortgaging petition B schedule property for the purpose of taking loan from a bank. 9. It is indisputable that the document in the name of claim petitioner was executed two weeks prior to the institution of the original petition. Under law, a prior interest created in favour of a third party before the institution of the suit or proceeding is immune from attachment. This is what Order XXXVIII Rule 8 read with Order XXI Rule 58 of the CPC clearly indicates. But this could be said to be so only if the holder of prior interest shows that the interest or right acquired by him arises out of a document legally and validly executed in his name. There is serious dispute at the instance of respondents 1 to 3 that the document is sham and was fraudulently created. 10. A document is said to be sham when it is not intended to operate between parties. In other words, it is not what it actually purports to demonstrate or present to others. As per Black Law's dictionary, the word 'sham' means 'something that is not what it seems'; 'a counterfeit'. A sham document contains only colourable or fictitious transaction between parties colluding each other and suppressing their actual motive and design to defeat the interest of third parties. To put it otherwise, despite the execution of a deed of transfer, the transferor retains the rights and interests in the property in collusion with the purported transferee. A sham document contains only colourable or fictitious transaction between parties colluding each other and suppressing their actual motive and design to defeat the interest of third parties. To put it otherwise, despite the execution of a deed of transfer, the transferor retains the rights and interests in the property in collusion with the purported transferee. The intention behind a colourable transaction is always to defeat the interests and rights of a third party under the guise of a purported transfer of property. If a document is proved to be sham, the transferee under the Deed never acquires any interest in the property and cannot claim immunity from attachment under the cover of Order XXXVIII Rule 8 of the CPC. The initial burden to prove a document to be sham is always on the person who propounds the plea. The burden shifts to the purported transferee to show that he is a bona fide purchaser only after the initial burden of proof is discharged. 11. So far as this case is concerned, except the document No.1910/2009 in the name of the claim petitioner, there is nothing on record to establish that it is a sham document. The document ex facie proves that it is a document of transfer executed for consideration. Until it is shown that the document contains a colourable or a fictitious transaction, the document has to be presumed that it has been executed for valid consideration. Only because the claim petitioner is the sister of the executant, no irresistible conclusion can be drawn to the effect that the parties colluded each other and intended to bring a sham document into existence. Therefore, as matters now stand, the impugned order of the court below dismissing the claim petition cannot be sustained. 12. The court below seems to have jumped into the conclusion that the transaction was fraudulent without having had the opportunity to examine the evidence as to the veracity of allegation of fraud raised by respondents 1 to 3. We therefore hold that the impugned order is liable to be set aside. But having regard to the facts and circumstances of the case, we are inclined to extend one more opportunity to the parties to adduce sufficient evidence in support of their respective contentions, for which, the matter needs to be remitted back to the court below. 13. We therefore hold that the impugned order is liable to be set aside. But having regard to the facts and circumstances of the case, we are inclined to extend one more opportunity to the parties to adduce sufficient evidence in support of their respective contentions, for which, the matter needs to be remitted back to the court below. 13. However, we notice that the original petition was finally disposed of by the court below on 31.3.2010 by creating charge for arrears of past maintenance in favour of minor children over petition B schedule property. It, therefore, follows that if at all for any valid reason, the attachment happens to be lifted accepting the case of the claim petitioner, still the property would continue to be under charge created by the order of the court. A question may incidentally arise in this context as to whether charge created over the property could also be sought by the claimant to be set aside in the same claim petition invoking the provisions in Order XXI Rule 58 of the Code. Looking at the language and the terms used in Order XXI Rule 58, it is manifestly clear that court doesn't have any power under the said provision to interfere with an order creating charge over the property. The court's power to proceed under Order XXI Rule 58 of the Code and adjudicate upon questions relating to right, title and interest in the property accrues only when the claimant is interested in challenging the order of attachment on the ground that property was not liable to attachment. In other words, except when property is under attachment and it is sought to be lifted, the court cannot under any circumstances assume power under Order XXI Rule 58 and proceed to decide a claim put forward by a third party seeking adjudication of his purported rights in the property. Enquiry contemplated under Order XXI Rule 58 into the rights or interests of the claimant is directed exclusively towards examining the sustainability or legality of the order attaching the property. It does not extend to any other situations nor to any person complaining that an order creating change was illegal or wrongly passed by the court in respect of his property. 14. It does not extend to any other situations nor to any person complaining that an order creating change was illegal or wrongly passed by the court in respect of his property. 14. An order attaching a property and an order creating charge on a property are different concepts of law and one cannot be mistaken for the other. Attachment is intended to interdict private transfer or delivery of the property as stipulated by Section 64 of the Code. It neither creates any title nor any encumbrance. But a charge, on the other hand, gives to its holder a right to payment of money out of the property charged whether by decree or operation of law. A decree or order creating charge over a property in a suit or proceeding is an outcome of final adjudication of rights and liabilities of the parties to lis. But an order of attachment passed by a court is not so and it stands on a different footing. While it is open to a third party affected by attachment to approach the court by preferring a claim or objection under Order XXI Rule 58 and seek lifting of attachment, he cannot seek to assail the legality or validity of an order creating charge over the property invoking the jurisdiction of the court under the same provision. His remedy under law lies elsewhere. In the light of the foregoing discussion we made, we set aside the impugned order of the Family Court, Kozhikode, in I.A.No.989/2012 and remit the matter back, directing the court below to decide the claim petition afresh, in accordance with law, after extending sufficient opportunities to parties on either side to substantiate their respective contentions. It is also made clear that the court below will be at full liberty to take appropriate decision in the matter, without being influenced by any of the observations made in this judgment. All pending interlocutory applications are closed.