Allowed

Smt. Janakamani v. Smt. Kempamma

Karnataka HC14 Jul 2022MFA/2293/2017

Case brief

AI extract

What is this about?

The High Court dismissed an application for attachment of property under Order 39 Rule 2A CPC by the respondents against the appellants. The Court held that the temporary injunction merged with the final judgment dismissing the main suit, rendering the attachment impermissible. The Court noted that if the sale deed was merely an internal arrangement, the respondents retain liberty to challenge it

What did the court decide?

Setting aside the order dated 22.02.2017 passed in Misc. No.40/2016 by the Senior Civil Judge, Devanahalli.

Smt. Janakamani Vs Smt. Kempamma — Property and Title | Karnataka HC (2022)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 14^TH DAY OF JULY, 2022

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BEFORE

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THE HON’BLE MR.JUSTICE B.M.SHYAM PRASAD

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MISCELLANEOUS FIRST APPEAL NO.2293/2017 (CPC)

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BETWEEN:

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SMT. JANAKAMANI W/O V.S. ARAVAINDAN AGED ABOUT 42 YEARS, RESIDING AT NO.49/1, 2^ND CROSS, NANJAPPA GARDEN BEHIND MAMATHA SCHOOL, R.T. NAGAR POST, BENGALURU - 560 032.

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M/S NAM ESTATE PRIVATE LIMITED REPRESENTED BY ITS PRESENT AUTHORIZED SIGNATORY MR. B.S. NARAYAN AGED ABOUT 50 YEARS, S/O LATE B.S. SUNDARAJAN COMPANY INCORPLORATED UNDER COMPANIES ACT, HAVING ITS REGISTERED OFFICE AT 1^ST FLOOR, EMBASSY POINT, NO.150, EMBASSY ROAD, BANGALORE - 560 001.

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... APPELLANTS

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(BY SRI.S.M. CHANDRASHEKAR, SENIOR COUNSEL FOR SRI. CHANDRASHEKAR PATIL, ADVOCATE)

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AND:

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SMT. KEMPAMMA W/O S. PATALAPPA

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AGED ABOUT 64 YEARS, RESIDING AT THARUNISE POST & VILLAGE, JALA HOBI, BENGALURU NORTH - 562 110.

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SMT. ANJINAMMA W/O DODDAARAGAPPA AGED ABOUT 61 YEARS, R/O LATE SETTIGERE VILLAGE, JALA HOBLI, BENGALURU NORTH - 562 110.

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ANJINAPPA S/O LATE MUNIHANUMANTHARAYAPPA AGED ABOUT 60 YEARS,

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KEMPANNA S/O LATE MUNIHANUMANTHARAYAPPA AGED ABOUT 72 YEARS,

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MUNIYAPPA S/O LATE MUNIHANUMANTHARAYAPPA AGED ABOUT 57 YELARS, RESPONDENTS NO.3 TO 5 ARE R/AT NAGAMANGALA VILLAGE, KUNDANA HOBLI, BENGALURU NORTH TQ - 562 110.

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SMT. ANANDAMMA D/O ANJINAPPA AGED ABOUT 34 YEARS,

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SMT. ARUNAKSHI D/O ANJINAPPA AGED ABOUT 34 YEARS, RESPONDENTS NO.6 AND 7 ARE R/AT NAGAMANGALA VILLAGE,

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HEGGANALLI POST KUNDANA HOBLI, DEVANAHALLI TALUK - 562 110 BENGALURU RURAL DISTRICT.

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... RESPONDENTS

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(BY SRI. BADRI VISHAL, ADVOCATE FOR R1 & R2; R3 TO R6 ARE SERVED AND UNREPRESENTED VIDE ORDER DATED 01.07.2022 NOTICE TO R7 IS HELD SUFFICIENT)

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THIS MISCELLANEOUS FIRST APPEAL IS FILED UNDER ORDER XLIII RULE 1(r) OF THE CPC, AGAINST THE ORDER DATED 22.02.2017 PASSED IN MISC.CASE NO.40/2016 ON THE FILE OF THE SENIOR CIVIL JUDGE AND JMFC, AT DEVANAHALLI, ALLOWING THE APPLICATION FILED UNDER ORDER 39 RULE 2A R/W SECTION 151 OF CPC.

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THIS MISCELLANEOUS FIRST APPEAL COMING ON FOR ORDERS THIS DAY, THE COURT DELIVERED THE FOLLOWING:

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JUDGMENT

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The appellants are the sixth and seventh defendants in O.S. No.853/2008 on the file of the Senior Civil Judge and JMFC, Devanahalli [for short, 'the civil Court' ]. The first and second respondents [the plaintiffs] have challenged the title to the subject property in Sri. Munihanumantharayappa, the Testator who has executed his last Will and Testament

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bequeathing the subject property in favour of his Legatees, the third and fourth defendants [the fifth and sixth respondents]. These defendants have in turn transferred the subject property in favour of the sixth defendant [ the first appellant ], and he has transferred the subject property in favour of the seventh defendant [the second appellant]. The suit is ultimately dismissed on merits vindicating the defendants' case that Sri. Munihanumantharayappa held the subject property absolutely and the bequeath by him is valid in law.

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The present proceeding is because the first and second respondents, who had the benefit of temporary injunction against alienation of the subject property in the suit, have initiated proceedings in Misc. No.40/2016 under Order XXXIX Rule 2A of CPC. The first and the second respondents have asserted that the temporary injunction granted by the civil Court is confirmed by this Court in MFA No.3798/2013 and

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notwithstanding this order of temporary injunction dated 26.03.2013, the first appellant as the 'vendor' and the second appellant as the ' confirming party ' have executed the sale deed dated 25.09.2014 transferring the subject property in favour of M/s. Udyaman Investments Private Limited [the eighth defendant].

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The appellants' defense is that the sale deed dated 25.09.2014 is in favour of a sister concern, a subsidiary. The Directors of the two entities being the same, there is no actual transfer, and the property remains within the fold of the dispute. The civil Court has allowed the application under Order XXXIX Rule 2A of CPC on 22.02.2017 attaching the subject property directing the appellants to furnish the details of the immovable property.

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Sri. S.M. Chandrashekar, learned Senior

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Counsel for the appellants, submits that both the miscellaneous proceedings and the suit are decided on

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the same day viz., 22.02.2017. The appellants' case that Sri. Munihanumantharayappa was the absolute owner of the subject property and that he could bequeath this property to the third and fourth defendants, which would enable further transfers, stands vindicated with the Judgment in O.S. No.853/2008. The significance of this Judgment is not just vindication of the appellants' case but merger of the interim order with the Judgment and in that event, the temporary injunction would stand dissolved.

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Sri. S.M. Chandrashekar relies upon a decision of the Hon'ble Supreme Court in 'KANWAR SINGH SAINI v. HIGH COURT OF DELHI'¹ in support of his submission that once the interim order merges with

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the final order resulting in dismissal of the suit, the proceedings under Order XXXIX Rule 2A of the CPC would not be maintainable and though both the original

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proceedings and the miscellaneous applications are 1[2012] 4 SCC 307

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disposed of on the same day, this proposition must apply in all force. The civil Court, while considering the miscellaneous application separately could not have directed attachment in the light of its own finding on the original side

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Sri. S.M. Chandrashekar further submits that the interim orders are always granted to maintain status quo as things stand at an undisputed point of time. The first and second respondents were the beneficiaries of the temporary injunction order in this case but with the Judgment on the original side, the benefit could not have been extended and therefore, the attachment is impermissible.

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Sri. Badri Vishal, the learned counsel for the contesting respondents viz., first and second respondents, submits that these respondents may have failed in the suit, but the civil Court's Judgment is called in question in appeal before this Court in RFA

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No.829/2017 which is pending consideration. The appeal would be continuation of the original proceedings. The sale deed dated 25.09.2014 is admittedly executed in the teeth of the interim order against such execution. The civil Court has therefore, rightly attached the property and such attachment cannot be faulted especially with the appellants challenging the civil Court's Judgment in an appeal.

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This Court, on a careful consideration of the facts and circumstances of the case, is of the opinion that perhaps it could reasonably be concluded that the civil Court has erred in attaching the subject property while finally disposing of the suit against the first and second respondents-plaintiffs. This question of law can be considered even under different circumstances. Significantly, in the present case the appellants cannot deny that the sale deed dated 25.09.2014 is executed in violation of the interim order of injunction against

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alienation, and this should be considered in the light of the appellants' defense that there is no transfer and the sale deed dated 25.09.2014 facilitates a change in the name without a transfer as a mitigating circumstance because it is now settled that the Courts, while considering an application under Order XXXIX Rule 2A of CPC, must consider mitigating circumstances to decide whether disobedience is deliberate.

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The appellants' defense as recorded by the civil Court reads as follows:

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"4. The case of the respondents no.6 and 7 that the petitioners have filed the above suit for the relief of partition and subsequently by way of amendment, they have introduced the relief of declaration seeking to avoid the sale deeds executed by defendant No.6 in favour of respondent No.7 in respect of the portion of the schedule property and also sale deeds executed by the defendant No.1 in favour of defendant No.6 and by other defendants. The respondent No.7 is a registered Company. In the application, the petitioners alleged that the respondent No.7

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alienated the portion of the suit schedule property in favour of the respondent No.8 under the Sale Deed dated 25.09.2014. It is submitted that respondent No.8 is a Private Limited Company, which is the subsidiary and sister concern of respondent No.7 Company. The Directors of both the Company are one and the same. The respondent No.7 is also a director in both the Companies and he is authorized signatory of both the companies. He has signed the sale deed on behalf of both the parties. There is no change of ownership and it is only change of name of purchaser for convenience and internal arrangement. The sale deed effected only for the purpose of records but ownership remains with the same. There is no transfer of interest in the eyes of law. No third party rights are created. The sale effected for the purpose of name sake and there is no transfer involved. There is no violation of the interim order granted by this Court. The respondent No.7 has got highest respect to the order of this court. There is no violation of interim order granted by this court. The petition is filed to harass the respondents."

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If the appellants are categorical in their defense that there is no transfer of interest in the

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subject property under the sale deed dated 25.09.2014 and no third party rights are created, and this sale deed is only an internal arrangement between a holding Company and its subsidiary, the indisputable conclusion would be that this property would be subject to any order in the contesting respondents' appeal in RFA No.829/2017. If the contesting respondents do succeed in their appeal, the sale deed dated 25.09.2014 cannot affect their rights with room for multiplicity of proceedings. Thus, mitigating circumstances are established.

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This Court is therefore, of the view that while the appellants must succeed in the appeal, but this Court must also record that the contesting respondents should have the liberty to take every advantage of the statement that there is no transfer because of the sale deed dated 25.09.2014.

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For the foregoing, the appeal is allowed of setting aside the order dated 22.02.2017 in Misc. No.40/2016 of the Senior Civil Judge and JMFC, Devanahalli.

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SD/JUDGE

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AN/-

Smt. Janakamani v. Smt. Kempamma

Case brief

What is this about?

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Smt. Janakamani v. Smt. Kempamma

Case brief

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