While dismissing Sun TV’s application, the Madras High Court has held that an unregistered guarantees and an earlier compromise given up through a fresh post-attachment settlement could not establish rights protected under Section 64(2) CPC or Order XXXVIII Rule 10. Emphasising that Section 64(2) CPC requires the contract for transfer or delivery to have been entered into and registered before attachment, the Court found that Sun TV’s guarantee and undertaking were admittedly unregistered.
After that compromise was challenged on allegations of fraud and forgery, the parties entered into a fresh compromise. The Court found that the earlier compromise had never been acted upon and that the sale deeds followed the subsequent, post-attachment compromise. The Court thus held that entering into the fresh compromise amounted to giving up rights and claims under the initial compromise. Sun TV therefore could not obtain protection under either Section 64(2) CPC or Order XXXVIII Rule 10 on these facts.
Briefly, Sun TV Network Limited sought release of properties attached in execution proceedings initiated by Marina Holdings against N. Ramasamy. Sun TV claimed prior rights under a 2018 guarantee, undertaking and court-recorded compromise arising from disputes concerning the Tamil film Sarkar. It subsequently purchased the properties through registered sale deeds in 2021. However, at Marina Holdings’ instance, the properties had already been attached on 12 March 2020, and a further attachment order was registered on 10 September 2020. Sun TV claimed that its earlier rights prevailed over the attachment.
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A Single Judge Bench of Justice K. Kumaresh Babu observed that Section 64(2) CPC protects a transfer pursuant to a contract entered into and registered before attachment, while Order XXXVIII Rule 10 protects rights existing before attachment in favour of persons who are not parties to the attachment proceedings. The guarantee and undertaking relied upon by Sun TV were admittedly unregistered.
The Court also noted that the 2018 compromise had been challenged on allegations of fraud and forgery, following which the parties entered into a fresh compromise on 23 September 2021. It found that the earlier compromise had never been acted upon and that the sale deeds were executed only pursuant to the subsequent compromise, after attachment. The Court treated the fresh compromise as giving up the rights and claims based on the initial compromise.
