Heard learned counsel for the appellant at the admission stage.
This second appeal arises out of O.S. No.177 of 2005 filed by appellant against his mother defendant respondent for declaring the sale deed dated 20.07.2002 executed by him in favour of his mother/ defendant as void on the ground that it was executed to defraud the creditors by the plaintiff. Even the defendant did not appear but the suit was dismissed ex parte on 15.07.2006 by Civil Judge, Senior Division, Kairana, District Muzaffarnagar. Not only the suit was dismissed but show cause notice was also issued to the plaintiff and his learned counsel to show cause within seven days as to why FIR should not be lodged against them. Against the said decree, plaintiff appellant filed Civil Appeal No.30 of 2006, which was dismissed by A.D.J. Court No.9, Muzaffarnagar on 24.01.2012 hence this Second Appeal. Plaintiff further stated in the plaint that after execution of the sale deed, he had cleared his debts.
According to the Section 53, Transfer of Property Act:
"Every transfer of immovable property made with intent to defeat or delay the creditors of the transferor shall be voidable at the option of any creditor so defeated or delayed."
Accordingly, the transfer made by the plaintiff in favour of his mother was not void on the ground mentioned in the plaint but only voidable and that also at the option of the creditor but not at the option of the plaintiff himself. The Privy Council in Zafrul Hasan vs. Farid Ud-Din AIR 1946 PC 177 has held that as between the parties to such transfer, the transfer cannot be avoided by either of them. In AIR 1954 Nagpur 129 (DB) it has been held that the effect of the declaration under Section 53, T.P. Act leaves the sale deed operative between the parties thereto and does not amount to cancelling or setting aside the same. In AIR 1939 Madras 894, AIR 1961 Panjab 423 and AIR 1954 Madras 173 it has been held that "as between the parties to such transfer, the transfer stands subject only to the right of the creditors to enforce their claim as if the transfer has not been made. It has further been held that the result of declaration under Section 53 is only to render the transfer inoperative as against creditors and that too only to the extent necessary to satisfy their claims and subject to their claims, the transaction is valid and enforceable. In AIR 1963 Mysore 257, it has been held that if transfer is avoided under Section 53 still transaction is not wiped out but has no effect on creditors defeated or delayed. In Mohammad Taki Khan Vs. Jang Singh, AIR 1935 All. 529 (FB), it has been held that where the fraud intended to be affected has been carried out substantially the court will not allow any party to allege his own fraud in order to avoid his own deed.
In view of the above authorities, the suit was not maintainable and has rightly been dismissed.
However, in my opinion, there was no occasion to issue notice or direct lodging of FIR against plaintiff or his counsel.
Accordingly, second appeal is dismissed on merit. However the directions given by the courts below for issuing notice or lodging FIR against plaintiff and his counsel are quashed. However plaintiff is saddled with the penalty of Rs.25,000/- for instituting frivolous, fraudulent suit and consuming time of the Court. This amount shall be paid by him to the Bar Association of Kairana, District Muzaffarnagar within three months failing which the Collector shall recover the same from him like arrears of land revenue and pay to the Bar Association. The Bar Association shall utilise the amount only for purchasing the Books.
Office is directed to supply a copy of this order free of cost to Shri S.P.Mishra, learned standing counsel for sending the same to the Collector, Muzaffarnagar and President/Secretary Bar Association, Mairana, Muzaffarnagar. Office shall also send a copy of this order to President/ Secretary Bar Association, Kairana District Muzaffarnagar.
Order Date :- 24.5.2012 NLY