Court Rules Unregistered Guarantee and Compromise Memo Do Not Confer Pre-Existing Rights to Defeat Court Attachment Under CPC Section 64
In a significant judgment dated 16 October 2026, the Madras High Court, presided over by Mr. K. Kumaresh Babu, J., dismissed the application filed by Sun TV Network Limited seeking to raise the attachment on immovable properties sold by M/s. Marina Holdings after the properties had already been attached by the Court. The dispute arose from a theatrical distribution agreement involving the Tamil film `SARKAR' and subsequent arbitration and execution proceedings concerning payments and security interests.
The applicant, Sun TV Network Limited, claimed to be a bona fide purchaser of the properties and sought release of the attachment imposed on the properties. The applicant relied heavily on an unregistered guarantee deed and an earlier Joint Memorandum of Compromise (entered in 2018), arguing these documents created pre-existing rights that should prevail over the attachment. However, the Court found that the properties were attached by an order dated 12 March 2020, which was duly registered with the Sub-Registrar on 10 September 2020, well before the applicant purchased the properties in 2021.
The Court emphasized the strict provisions of Section 64 of the Civil Procedure Code (CPC), which declares alienation of property after attachment as void unless the contract for transfer or delivery was executed and registered before the attachment order. Since the guarantee and undertaking relied upon by the applicant were unregistered, they could not confer any enforceable pre-existing rights to defeat the attachment. Furthermore, the earlier Joint Memorandum of Compromise was challenged on grounds of fraud and forgery and was replaced by a subsequent compromise agreement after the attachment order, effectively nullifying any claim of prior rights based on the initial compromise.
The Court held that the applicant's claim of being a bona fide purchaser was untenable given the registered attachment notice, which would have been discoverable through due diligence such as checking the Encumbrance Certificate. The judgment clarified that the protections under Section 64(2) CPC and Order XXXVIII Rule 10 CPC, which safeguard pre-existing rights against attachment, are only available where there is a valid registered contract or right existing before the attachment. Consequently, the application to raise the attachment was dismissed, reinforcing the principle that post-attachment transfers without proper registration are void against the attachment.
This ruling underscores the importance for purchasers to conduct thorough due diligence, including verifying attachments registered with the Sub-Registrar, before acquiring immovable property. It also highlights the legal requirement of registration for documents conferring rights over immovable properties to be enforceable against court attachments.
Bottom Line:
Civil Procedure Code, 1908 - Claim for raising attachment over immovable property by alleged bona fide transferee - Unregistered guarantee/undertaking cannot confer enforceable pre-existing right against attachment - Protection under Section 64(2) CPC and Order XXXVIII Rule 10 CPC available only where prior right/registered contract before attachment is established - Subsequent sale after attachment not protected.
Statutory provision(s):
Civil Procedure Code, 1908 Section 64(1), Section 64(2), Order XXXVIII Rule 10
Sun TV Network Limited v. M/s.Marina Holdings, (Madras) : Law Finder Doc Id # 2999270
