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[Landmark Judgement] Sanat Kumar Chakravarty V. Krishnadhan Mazumdar (1952) 

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Landmark Judgment Law Insider (1)

Published on: 26 September 2023 at 17:24 IST

Court: Supreme Court of India

Citation: Sanat Kumar Chakravarty V. Krishnadhan Mazumdar (1952) 

Honourable Supreme Court of India has held that the tests for determining the genuineness of a transfer, which take into consideration the following two factors: the source of the purchase money; and possession of the property. It is held that if the properties were in danger of being sold in execution or price paid was less price than the market value could not convert a genuine transaction into a sham one transaction.

6. The first respondent thereupon preferred an appeal to the Calcutta High Court, which set aside the judgment and decree of the trial court and declared that the first respondent was entitled to realise his dues from the properties which had been attached in the second execution case. The main findings of the High Court were as follows:

(1) that the kobala was not a genuine but a sham transaction;

(2) that the appellant had no money of his own and the sum which had been received from the insurance company belonged to his father, the second respondent;

(3) that the properties in question were worth very much more than the sum of Rs 12,000 which was stated to be the consideration for the kobala; and

(4) that the course of litigation and the repeated attempts made by the second respondent to obstruct and defeat the first respondent’s application for execution, supported the view that the kobala was the last manoeuvre adopted by the second respondent in the course of the fight to defeat the claim of the first respondent.

Drafted By Abhijit Mishra