{"id":174606,"date":"1990-03-06T00:00:00","date_gmt":"1990-03-05T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/vannarakkal-kallalathil-vs-chandramaath-balakrishnan-and-on-6-march-1990"},"modified":"2017-11-19T05:06:22","modified_gmt":"2017-11-18T23:36:22","slug":"vannarakkal-kallalathil-vs-chandramaath-balakrishnan-and-on-6-march-1990","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/vannarakkal-kallalathil-vs-chandramaath-balakrishnan-and-on-6-march-1990","title":{"rendered":"Vannarakkal Kallalathil &#8230; vs Chandramaath Balakrishnan And &#8230; on 6 March, 1990"},"content":{"rendered":"<div class=\"docsource_main\">Supreme Court of India<\/div>\n<div class=\"doc_title\">Vannarakkal Kallalathil &#8230; vs Chandramaath Balakrishnan And &#8230; on 6 March, 1990<\/div>\n<div class=\"doc_citations\">Equivalent citations: 1990 SCR  (1) 832, \t  1990 SCC  (3) 291<\/div>\n<div class=\"doc_author\">Author: K Shetty<\/div>\n<div class=\"doc_bench\">Bench: Shetty, K.J. (J)<\/div>\n<pre>           PETITIONER:\nVANNARAKKAL KALLALATHIL SREEDHARAN\n\n\tVs.\n\nRESPONDENT:\nCHANDRAMAATH BALAKRISHNAN AND ANR.\n\nDATE OF JUDGMENT06\/03\/1990\n\nBENCH:\nSHETTY, K.J. (J)\nBENCH:\nSHETTY, K.J. (J)\nSAHAI, R.M. (J)\n\nCITATION:\n 1990 SCR  (1) 832\t  1990 SCC  (3) 291\n JT 1990 (1)   390\t  1990 SCALE  (1)519\n\n\nACT:\n    Code  of  Civil  Procedure, 1908: S.  64,  or  38,\tRule\n10--Conveyance in pursuance of antecedent agreement for sale\nof attached property--Whether passes good title.\n\n\n\nHEADNOTE:\n    The\t land in dispute was agreed to be sold in favour  of\nthe  appellant\tunder an agreement.  Subsequently,  a  third\nparty  in execution of a decree got the\t property  attached.\nThe  sale deed was executed thereafter. A question arose  as\nto  the validity of the sale. The High Court held  that\t the\nsale would be subject to attachment.\nAllowing the appeal by special leave, the Court,\n    HELD:  The\tagreement  for sale  creates  an  obligation\nattached  to  the ownership of the property.  The  attaching\ncreditor  is  entitled to attach only the right,  title\t and\ninterest of the judgment debtor. Hence, if an agreement\t for\nsale  is  entered  into before\tattachment,  the  attachment\ncannot\tbe  free from the obligation so\t incurred,  and\t the\nattaching  creditor will not get any right higher  than\t the\njudgment debtor had on the date of the attachment. He cannot\nignore that obligation and proceed to bring the property  to\nsale as if it remained the absolute property of the judgment\ndebtor. [835C, 834F, 835E]\n    Accordingly, though s. 64 CPC is intended to protect the\nattaching  creditor, but if the subsequent conveyance is  in\npursuance  of an agreement for sale which was  entered\tinto\nbefore\tthe attachment, the contractual\t obligation  arising\ntherefrom must be allowed to prevail over the rights of\t the\nattaching  creditor.  The rights of the\t attaching  creditor\nshall not be allowed to override the contractual  obligation\narising\t from the antecedent agreement for sale of  the\t at-\ntached property. [835D-E]\n    Paparaju Veeraraghavayya v. Killaru Kamala Devi &amp;  Ors.,\nAIR 1935 Mad. 193; Veerappa Thevar &amp; Ors. v.C.S. Venkataram-\nma  Aiyar  &amp; Ors., AIR 1935 Mad. 872; Angu  Pillai  v.M.S.M.\nKasiviswanathan\t Chettiar,  AIR 1974 Mad. 16;  Puma  Chandra\nBasak  v. Daulat Ali Mollah, AIR 1973 Cal. 432; Rango  Rama-\nchandra v. Gurlingappa\n833\nChinnappa,  AIR 1941 Bom. 198; <a href=\"\/doc\/664771\/\">Yashvant Shankar\t Dunakhe  v.\nPrayarji  Nurji Tamboli, AIR<\/a> 1943 Bom. 145  and\t Kochuponchi\nVarughese  v. Quseph Lonan, AIR 1952 Travancore-Cochin\t467,\napproved.\n    Mohinder  Singh &amp; Anr. v. Nanak Singh &amp; Anr.,  AIR\t1971\nPb. &amp; Haryana 381, overruled.\n    The\t sale in the instant case would not thus be  subject\nto  the attachment. The purchaser would get good  title\t de-\nspite attachment. [833F, 834D]\n\n\n\nJUDGMENT:\n<\/pre>\n<p>    CIVIL  APPELLATE JURISDICTION: Civil Appeal No. 1349  of<br \/>\n<span class=\"hidden_text\">1990<\/span><br \/>\n    From  the  Judgment\t and Order dated  18.8.1988  of\t the<br \/>\nKerala High Court in E.S.A. No. 23 of 1987.\n<\/p>\n<p>S. Padmanabhan and R.N. Keshwani for the appellant.<br \/>\nThe Judgment of the Court was delivered by<br \/>\nK. JAGANNATHA SHETTY, J. Special leave granted.<br \/>\n    An\textent\tof 80-cents of land which is in\t dispute  in<br \/>\nthis appeal was agreed to be sold in favour of the appellant<br \/>\nunder  an agreement dated October 9, 1978. Before  the\tsale<br \/>\ndeed  was executed, a third party in execution of  a  decree<br \/>\ngot  the  property attached on November 16, 1978.  The\tsale<br \/>\ndeed  was  executed on November 23, 1978. The  question\t is:<br \/>\nDoes the sale prevail over the attachment?\n<\/p>\n<p>    The\t High Court of Kerala in the judgment  under  appeal<br \/>\nhas held that the sale would be subject to attachment.\tThis<br \/>\nappears from the following observation:\n<\/p>\n<p>&#8220;The sale deed was executed at a time when the property\t was<br \/>\nalready\t under attachment. It is true that even\t before\t af-<br \/>\nfecting attachment there was an agreement for sale by Saroj-<br \/>\nini Ramakrishnan in favour of the appellant. But the  agree-<br \/>\nment for sale will not create any interest in the  property.<br \/>\nThe fact that Ext. A-12 Sale deed was executed on the  basis<br \/>\nof  an\tagreement executed before the  attachment  will\t not<br \/>\nplace  the appellant in any better position. He\t could\ttake<br \/>\nthe   80  cents\t under\tExt.  A-12  only  subject   to\t the<br \/>\nattachment.&#8221;\n<\/p>\n<p><span class=\"hidden_text\">834<\/span><\/p>\n<p>    The correctness of the view taken by the High Court\t has<br \/>\nbeen called into question in this appeal.\n<\/p>\n<p>    We\tmay  first draw attention to some  of  the  relevant<br \/>\nstatutory provisions bearing on the question. Order 38\tRule<br \/>\n10  of the Code of Civil Procedure provides that  attachment<br \/>\nbefore\tjudgment shall not affect the rights existing  prior<br \/>\nto the attachment of persons not parties to the suit.  Under<br \/>\nSection\t 40  of the Transfer of Property  Act,\ta  purchaser<br \/>\nunder a contract of sale of land is entitled to the  benefit<br \/>\nof  an obligation arising out of that contract and  it\tpro-<br \/>\nvides  that  that  obligation may  be  enforced\t inter\talia<br \/>\nagainst\t a transferee with notice. Section 91 of the  Trusts<br \/>\nAct also recognises this principle that the transferee\twith<br \/>\nnotice of an existing contract of which specific performance<br \/>\ncan  be enforced must hold the property for the\t benefit  of<br \/>\nthe party to the contract. These are equitable rights though<br \/>\nnot  amounting to interest in immovable property within\t the<br \/>\nmeaning of Section 54 of the Transfer of Property Act  which<br \/>\ndeclares that a contract of sale does not create an interest<br \/>\nin the property. On this line of reasoning it has been\theld<br \/>\nby the Madras High Court that the purchaser of an antecedent<br \/>\nagreement  gets good title despite attachment. See  Paparaju<br \/>\nVeeraraghavayya v. Killaru Kamala Devi &amp; Ors., AIR 1935 Mad.<br \/>\n193,  Veerappa\tThevar &amp; Ors. v.C.S.  Venkataramma  Aiyar  &amp;<br \/>\nOrs., AIR 1935 Mad. 872 and Angu Pillai v.M.S.M.  Kasiviswa-<br \/>\nnathan Chettiar, AIR 1974 Mad. 16.\n<\/p>\n<p>    There  is  a useful parallel from the  decision  of\t the<br \/>\nCalcutta  High\tCourt in Purna Chandra Basak v.\t Daulat\t Ali<br \/>\nMollah,\t AIR 1973 Cal. 432 wherein it was observed that\t the<br \/>\nattaching creditor attaches only the right, title and inter-<br \/>\nest of the debtor and attachment cannot confer upon him\t any<br \/>\nhigher\tright  than the judgment-debtor had at the  date  of<br \/>\nattachment.\n<\/p>\n<p>    Hence,  if under a contract of sale entered into  before<br \/>\nattachment, the conveyance after attachment in pursuance  of<br \/>\nthe contract passes on good title inspite of the attachment.<br \/>\nTo  the\t same effect are the decisions of  the\tBombay\tHigh<br \/>\nCourt  in  Rango Ramachandra v. Gurlingappa  Chinnappa,\t AIR<br \/>\n1941 Bom. 198 and <a href=\"\/doc\/664771\/\">Yashvant Shankar Dunakhe v. Prayarji Nurji<br \/>\nTamboli,  AIR<\/a> 1943 Bom. 145. The High Court  of\t Travancore-<br \/>\nCochin\tin Kochuponchi Varughese v. Quseph Lonan,  AIR\t1952<br \/>\nTravancore-Cochin 467 has also adopted the same reasoning.<br \/>\nThe Punjab &amp; Haryana High Court however, has taken a con-\n<\/p>\n<p><span class=\"hidden_text\">835<\/span><\/p>\n<p>trary  view  in Mohinder Singh and Anr. v. Nanak  Singh\t and<br \/>\nAnr.,  AIR 1971 Pb. &amp; Haryana 381. It has been held  that  a<br \/>\nsale in pursuance of a pre-attachment agreement is a private<br \/>\nafienation of property and must be regarded as void  against<br \/>\nthe  claim  ot the attaching creditor. In  support  of\tthis<br \/>\nproposition,  Section 64 of the Code of Civil Procedure\t was<br \/>\nrelied\tupon which according to the High Court was  intended<br \/>\nto  protect the attaching creditor against  private  aliena-<br \/>\ntion. This was also the observation of the Lahore High Court<br \/>\nin Buta Ram &amp; Ors. v. Sayyed Mohammad, AIR 1935 Lahore 71.<br \/>\n    In\tour  opinion, the view taken by the High  Courts  of<br \/>\nMadras, Bombay, Calcutta and Travancore-Cochin in the afore-<br \/>\nsaid cases appears to be reasonable and could be accepted as<br \/>\ncorrect. The agreement for sale indeed creates an obligation<br \/>\nattached to the ownership of property and since the  attach-<br \/>\ning creditor is entitled to attach only the right, title and<br \/>\ninterest  of the judgment-debtor, the attachment  cannot  be<br \/>\nfree  from the obligations incurred under the  contract\t for<br \/>\nsale.  Sec.  64\t CPC no doubt was intended  to\tprotect\t the<br \/>\nattaching  creditor, but if the subsequent conveyance is  in<br \/>\npursuance  of  an agreement for sale which  was\t before\t the<br \/>\nattachment,  the  contractual obligation  arising  therefrom<br \/>\nmust be allowed to prevail over the rights of the  attaching<br \/>\ncreditor. The rights of the attaching creditor shall not  be<br \/>\nallowed to override the contractual obligation arising\tfrom<br \/>\nan  antecedent agreement for sale of the attached  property.<br \/>\nThe  attaching\tcreditor cannot ignore that  obligation\t and<br \/>\nproceed to bring the property to sale as if it remained\t the<br \/>\nabsolute property of the judgment-debtor. We cannot,  there-<br \/>\nfore,  agree with the view taken by the Punjab\tand  Haryana<br \/>\nHigh  Court in Mohinder Singh&#8217;s case AIR 1971 Pb. &amp;  Haryana\n<\/p>\n<p>381.<br \/>\n  In  the conclusion that we have reached, this appeal\tmust<br \/>\nbeallowed and is accordingly allowed. The order of the\tHigh<br \/>\nCourt is reversed and that of the trial court is restored.<br \/>\nIn  the\t circumstances of the case, we make no order  as  to<br \/>\ncosts.\n<\/p>\n<pre>P.S.S.\t\t\t\t\t\t      Appeal\nallowed.\n<span class=\"hidden_text\">836<\/span>\n\n\n\n<\/pre>\n","protected":false},"excerpt":{"rendered":"<p>Supreme Court of India Vannarakkal Kallalathil &#8230; vs Chandramaath Balakrishnan And &#8230; on 6 March, 1990 Equivalent citations: 1990 SCR (1) 832, 1990 SCC (3) 291 Author: K Shetty Bench: Shetty, K.J. (J) PETITIONER: VANNARAKKAL KALLALATHIL SREEDHARAN Vs. RESPONDENT: CHANDRAMAATH BALAKRISHNAN AND ANR. DATE OF JUDGMENT06\/03\/1990 BENCH: SHETTY, K.J. (J) BENCH: SHETTY, K.J. (J) SAHAI, [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-174606","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Vannarakkal Kallalathil ... vs Chandramaath Balakrishnan And ... on 6 March, 1990 - Free Judgements of Supreme Court &amp; High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/vannarakkal-kallalathil-vs-chandramaath-balakrishnan-and-on-6-march-1990\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Vannarakkal Kallalathil ... vs Chandramaath Balakrishnan And ... on 6 March, 1990 - Free Judgements of Supreme Court &amp; 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