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Board of Trustees of the Port of Mormugao Vs. Chowgule and Company Pvt. Ltd. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMumbai High Court
Decided On
Case NumberCivil Revn. Appln. No. 11 of 1984
Judge
Reported inAIR1985Bom174; ILR1985Bom652
ActsCode of Civil Procedure (CPC), 1908 - Sections 145 and 151
AppellantBoard of Trustees of the Port of Mormugao
RespondentChowgule and Company Pvt. Ltd.
Appellant AdvocateT.R. Andhyarujina, Sr. Adv., ;K.J. Presswala and;K.Y. Thaly, Advs.
Respondent AdvocateA. Setalwad, Sr. Adv., ;M. Korde and;S. Tamba, Advs.
Excerpt:
a) the case discussed the applicability of section 145 of the civil procedure code, 1908- it was held that section 145 applied only when the security was furnished or guarantee was given by the third party and not by party to suit. ; b) it was adjudged that there should be an order or decree for the payment of money to attract the provisions of section 145 of the civil procedure code, 1908. ; c) the case discussed over the enforcement of undertaking given by party to suit- the bond was executed by plaintiff embodying clear undertaking given to the court to pay certain sum of money to defendant in case the suit was finally decided against the plaintiffs- an application was filed by the defendants for enforcement of undertaking- it was held that the court had the inherent power to enforce.....order1. this revision application arises out of the order dt. 21st december, 1983 passed by the learned civil judge, senior division, margao, dismissing the application filed by the petitioners herein for the enforcement of an undertaking given or a bond executed by the present respondents in a suit, being the special civil suit no. 46/1969, filed by the latter for a declaration and a permanent injunction restraining the former from collecting some enhanced rates on iron ore pellets exported by the respondents/ original plaintiffs.2. in order to correctly understand the case of the petitioners, it will be convenient to state the relevant facts that led to the making of the impugned order.on 4th september, 1958 while the territories of goa, daman and diu were still under the portuguese.....
Judgment:
ORDER

1. This revision application arises out of the Order dt. 21st December, 1983 passed by the learned Civil Judge, Senior Division, Margao, dismissing the application filed by the petitioners herein for the enforcement of an undertaking given or a Bond executed by the present respondents in a suit, being the Special Civil Suit No. 46/1969, filed by the latter for a declaration and a permanent injunction restraining the former from collecting some enhanced rates on iron ore pellets exported by the respondents/ original plaintiffs.

2. In order to correctly understand the case of the petitioners, it will be convenient to state the relevant facts that led to the making of the impugned order.

On 4th September, 1958 while the territories of Goa, Daman and Diu were still under the Portuguese rule, the Portuguese Government enacted the Decree law No. 41816, inter alia, empowering the then Overseas Minister to enter into contracts with the West of India Portuguese Guaranteed railway Company Ltd. and to grant to the latter the right to construct and operate at the Mormugao Harbour a mechanical installation for the storage and handling of ores. In exercise of such enabling powers, the Portuguese Overseas Minister entered, on behalf of the Portuguese Government, into a contract with the respondents on 30th March, 1959. Under the terms and conditions of the said contract, respondents were to construct and operate a mechanical ore handling plant (hereinafter called MOHP) for the purposes of loading and handling ore and a sum of Rs. 4/- would ge charged on each tonne of iron ore exported through the said plant. It was further agreed that out of the sum of Rs. 4/-, 2/3rd would go to the respondents and the remaining 1/3rd to the West of India Portuguese Guaranteed Railway Company Ltd. Thus, the respondents would be liable to pay only Rs. 1.375 paisa per each tonne of iron ore exported by them. Pursuant to this contract, respondents constructed, in or about 1957, the said MOHP for the export of iron ore, whether theirs of other exporters, and started its operation. In or about April 1967, respondents started manufacture of iron ore pellets and began to export such pellets through the said Plant on the concessional rate of Rs. 1.375 per tonne. Petitioners objected to this on the ground that pellets, being a manufactured product from iron ore, were not falling within the meaning of iron ore in Cl. 30 of the Contract dated 30th March ,1959 and since the respondents did not agree, it was suggested that the matter be referred to arbitration as envisaged in the said Contract. Again, the respondents did not agree with this suggestion and hence, petitioners, on 9th July, m1969, decided that the export of pellets would be permitted only on payment of a rate of Rs. 3.35 per tonne, this decision having been communicated to the respondents by letter dated 11th July, 1969.

3. Respondents reacted to decision by filing, on or about 11th August, 1969, the aforesaid Special Civil Suit No. 46/1969, inter alia, praying that the petitioners/defendants in the said suit be permanently restrained by a perpetual injunction from acting upon or in pursuance of the said letter dated 11th July, 1969 and from recovering from them any sum in excess of Rs. 1.375 per tonne in respect of the export of iron ore pellets. Respondents also sought an interim injunction in the same terms of the prayer for the permanent injunction. The learned trial Judge granted ex parte the sought interim injunction and further issued, on 14-8-1969, a notice to the petitioners/defendant to show cause why the said injunction should not be made absolute. Petitioners showed cause against the confirmation of the ex parte injunction and also prayed for the stay of the said suit under S. 34 of the Arbitration Act in view of the provisions regarding arbitration contained in the Contract entered into on 30th March, 1959. The learned trial Judge, however, by his Order dated 18th April, 1970, refused to stay the suit and further confirmed the injunction earlier granted ex parte by him. The petitioners preferred an appeal against the aforesaid refusal to stay the suit to the then existing Judicial Commissioner's Court, but such appeal was dismissed on 19th August, 1975.

4. While confirming the injunction ex parte granted by him, the learned trial Judge however directed the respondents to submit half yearly statements of the pellets exported by them and to produce a suitable security for the difference between Rs. 1.375 and Rs. 3.35 per tonne in respect of the pellets exported. In compliance with the said order, respondents executed, on or about 11th June, 1970, a Bond whereby they undertook and bound themselves to pay to the petitioners the said difference between Rs. 1,375 and Rs. 3.35 per tonne in respect of pellets exported, should the suit be finally decided against them. The petitioners, however, being unsatisfied by such Bond, prayed by an application dated 15th June, 1970 that the respondents be ordered to give proper Guarantee instead of a mere Bond, but this was refused by the learned trial Judge by Order dated 3rd February, 1976.

5. The said Special Civil Suit No. 46/1969 was decided in favour of the respondents/original plaintiffs by judgment dated 31st March, 1978 passed by the learned Additional Civil Judge, Senior Division, Margao. This judgment and decree was, however, successfully challenged in appeal by the petitioners, for a Division Bench of this Court to which I was a party reversed on 21st March, 1983 the said judgment. Certificate of fitness to appeal to the Supreme Court having been denied, respondents approached the Apex Court with a Special Leave Petition which was dismissed on 12th August, 1983. Dissatisfied, respondents unsuccessfully filed a review application against the Order of dismissal of their Special Leave Petition and thus, the aforesaid Special Leave suit No. 46/1969 stood finally disposed of and dismissed. However, after the judgment of the trial Court was revered by the Division Bench of this Court on 21st March 1983 and before moving the Supreme Court with the Special Leave Petition, respondents filed on 7th April, 1983 a fresh suit in the Court of Civil Judge Senior Division, Vasco-da-Gama, being the Special Civil Suit No. 21/1983, praying for a declaration that the resolution of the petitioners dated 9th July, 1969 was not binding on them and that the petitioners were not entitled to recover any rate in respect of pellets exported through the aforementioned MOHP at the rate fixed by the said Resolution or any other rate fixed unilaterally by the petitioners.

6. After the dismissal of the Special Leave Petition by the Supreme Court on 12th August,1983, the petitioners filed in the Court of Civil Judge, Senior Division, Margao on 14-9-1983 an application, being Special Application No. 292/1983 for enforcement of the Security Bond executed by the respondents on 11-6-1970 and prayed they be paid a sum of Rs. 61,79,601.25 due from the date of the Order of the trial Judge dated 18-4-1970 in discharge of the Bond executed by the same respondents. The correctness of this amount was admitted by the respondents in their reply to the said application for enforcement of the Bond. In the meanwhile, petitioners had filed their written statement in the Special Civil Suit No. 21/83 filed by the respondents in the Vasco Court and had also preferred a counter-claim for the total difference of amount between Rs. 3.35 per tonne and Rs. 1.375 per tonne due by the respondents, aggregating to Rs. 89,99,444. 27, stating, however, that the respondents would be given credit for the amount realised by enforcement of the Bond in the Special Civil Suit No. 46/69, respondents, in their reply to the counter claim, inter alia, contended that the counter-claim, for the said differential amount is barred by limitation. The learned Civil Judge, Senior Division, Margao, finally disposed of the aforesaid application for the enforcement of the Bond, for by his Order dated 21st December,1983 dismissed it. The present revision application is directed against the aforesaid Order.

7. Petitioners challenge the said Order on several grounds, but in the course of the hearing, their learned counsel, Mr. Andhyarujina, did not press most of them and, restricting the attack, submitted that the learned Civil Judge has failed to exercise the jurisdiction vested in him inasmuch as he failed to get enforced the under taking given to the Court by the respondents and the Bond executed by them to pay to the petitioners the difference in the rate to be paid for the export of the iron ore pellets between Rs. 3.35 and Rs. 1.375 per tonne. He contended that the said undertaking and Bond can be enforced under the provisions of S. 145 C.P.C. and, as such, the learned Judge, having held differently, has failed to exercise the jurisdiction vested in him. The learned counsel further urged that, in any event, even if the undertaking and the bond was not enforceable under the provisions of S. 145 C.P.C., the learned Judge ought or have exercised his inherent jurisdiction for getting the undertaking duly enforced. He also submitted that, at any rate, respondents are estopped from disputing their undertaking given to the Court.

8. Meeting the case of the petitioners, Mr. Setalvad, learned counsel appearing for the respondents, however contended that, first of all, this revision application is not maintainable. In fact, the revisional powers are merely discretionary and cannot be used where and when a remedy is provided by law and the concerned party can take recourse to such remedy in order to get redress for his grievance. Secondly, the view taken by the learned Civil Judge is correct, for the undertaking or bond cannot be executed or enforced under the provisions of S. 145 C.P.C., since (a) the undertaking was not given to the Court but it is an undertaking to pay to the defendants in the suit; (b) there is no order of the Court to pay; and (c) section 145 does not apply to a party in the suit. Thirdly, the learned counsel further argued, the Bond was no more subsisting after the suit was decreed by the learned trial Judge on 31st March, 1978.

9. Before addressing myself to the merits of this revision application and before considering the rival contentions, I feel it expedient and proper to deal first, as a preliminary point, with the question of its maintainability. It has been contended on behalf of the respondents that ,considering the scope of a revision application ,it is manifest that the powers of the court in revision are merely discretionary and, as such, when a remedy is provided by law and the party concerned can avail himself of such remedy to get redress for his grievance, then, it is not open to him to seek relief in a revision application. Mr. Setalvad then urged that the petitioners had already preferred a counter-claim in the Special Civil Suit No.2183 instituted by the respondents in the Vasco Court , having included in the said counter-claim the amount sought to be realised by the enforcement of the Bond. Further, nothing prevents the petitioners, if they so desire, ;to file a summary suit for the enforcement of the undertaking or Bond executed by the respondents .This being the position, the learned counsel argued, it is not open to the petitioners to seek relief in a revision application and, on the other hand, there is no warrant for the court to exercise its revisional powers.

10. Undoubtedly, the exercise of revisional jurisdiction by the High Court is merely discretionary. It cannot be, therefore, gainsaid that it is for the Court to satisfy itself whether, in the circumstances of each case, there is warrant for the exercise of such discretionary jurisdiction is vested in the High Court to advance justice and is not however to be used as a matter of routine, but sparingly. Thus, if an alternative remedy by way of a suit or otherwise is open to the aggrieved party, then, the High Court in the exercise of its discretion, may ordinarily, specially when the alternative remedy is certain and conclusive, refuse to act under its revisional jurisdiction. It will therefore be necessary to look into the particular facts of the case at hand in order to satisfy myself whether there are reasonable grounds to justify my acting in the exercise of the revisional jurisdiction

11. Mr. Andhyarujina submitted that, in the circumstances of this case, the exercise of the revisional powers by this Court is not only justified but necessary, for no certain effective and conclusive remedy to get relief for their grievance is left open to the petitioners. He argued that, even before the filing of the Suit No. 46/69, the controversy between the petitioners and the respondents was whether or not pellets were within the meaning of iron ore in the contract. This controversy was the main issue in the said suit and though such controversy was decided in favour of the respondents by the learned trial Judge, ultimately, the Division Bench or this Court by judgment delivered on 21st March, 1983 held that pellets were a manufactured product and, as such, outside the meaning of iron ore in the contract dated 30th March, 1959 entered into by the Portuguese Government with the respondents. The learned counsel further submitted that, soon after the Division Bench allowed the appeal of the petitioners by judgment delivered on 21st March, 1983, the respondents instituted a fresh suit in the Vasco Court and while once again raising the question that pellets were within the meaning of iron ore in the said contract, contended that, in any event, the petitioners were not entitled to enhance the export rate of pellets unilaterally. The petitioners filed their written statement and further preferred a counter-claim in respect of the differential amount between the rates of Rs. 3.35 and Rs. 1.375 per tonne due from the time respondents started the export of pellets through MOHP. In their reply to the counter-claim, the respondents contended that the said claim is time barred. Then respondents, besides filing the said suit, also moved the Supreme Court with a Special Leave Petition which was dismissed on 12th August, 1983, as dismissed was their Review Application filed against the order of dismissal of the Special Leave Petition. The Special Civil suit No. 46/1969 having been thus finally decided, petitioners filed on 14th September, 1983 an application for the enforcement of the undertaking given or the Bond executed by the respondents as a security for the payment of the difference between the rates, the amount claimed having been admitted to be correct by the respondents. In the premises, Mr. Andhyarujina argued, since the respondents had already raised the question that the claim of the petitioners in respect or the differential amount or rates is time barred, it is apparent that no effective and conclusive remedy is left open to the petitioners to recover the said amount, being a fact that they were prevented from exercising their powers under Ss. 59 and 61 of the Major Port Trusts Act, 1963 by the injunction granted by the trial Court.

12. It is common ground that the Suit No.46/1969 was instituted by the respondents in order, inter alia, to restrain the petitioners from recovering rates for the export of pellets through MOHP at Berth NO.6, Mormugao Harbour in excess of Rs.1.375 per tonne; that respondents sought a temporary injunction restraining the petitioners in terms of the prayer in the suit and the said injunction was first granted ex parte and then, by Order dated 18th April, 1970, made absolute, but respondents were also directed to submit half yearly statements of pellets exported by them till the final disposal of the suit and, further, to give a suitable security for the difference in the rates; that the respondents, accordingly, executed a Bond on 11th June, 1970, whereby they undertook and bound them, selves to pay to the petitioners the difference between the rates in dispute in the suit, should the said suit be finally decided against them; that this Bond was accepted by the learned trial Judge and it was ordered on 15-6-1970 to be filed; that this suit was decreed by the Civil Judge Senior Division, Margao, by judgment dated 31st March, 1978, but this judgment was reversed in appeal by a Division Bench of this Court on 21st March, 1983; that a Special Leave Petition was filed by the respondents in the Supreme Court and the said petition was dismissed on 12-8-1983, as dismissed was a Review Application filed against the said dismissed; that, prior to the filing of the said Special Leave Petition, respondents filed in the Court of Vasco a suit praying that the petitioners are not entitled to recover rates in respect of the pellets exported through the MOHP at the rate fixed by the Resolution passed by the petitioners on 9th July 1969; and that, in reply to the counter-claim preferred in the said suit by the petitioners, respondents had contended that the differential amount between the two disputed rates cannot be recovered, since it is barred by limitation. It does not require much effort to see, in the light of the above facts, that a certain, effective and conclusive alternative remedy by way of a suit or otherwise is no more available to the petitioners and that the only effective means open to them to recover the said differential amount is by enforcing the undertaking given or Bond executed by the respondents, for the latter, having succeeded in preventing the petitioners from recovering the enhanced rates on the strength of the temporary injunction confirmed on 18th April, 1970, are now contending, and will most probably contend in any suit instituted for the purpose of recovery 0f the said amount by the petitioners. That the petitioners claim in that respect is bared by limitation. In the premises therefore, I am firmly of the view that this is a case where the looking into the impugned order in exercise of the revisional powers is entirely justified. Hence, I hold this revision application maintainable.

13. Having thus disposed of the preliminary point regarding the maintainability of the present revision application, I turn now to the merits thereof. As already stated, though the petitioners had attacked the impugned order in the memo of revision on several grounds, Mr. Andhyarujina restricted the challenge to . . . . . . . namely (a) the order dated 18th April, 1970 is, on its true construction, an order on the plaintiffs/respondents herein to pay the difference between Rs. 1,375 and Rs. 3.35 per tonne in respect of the quantities of pellets exported by the respondents through the said MOHP and, as such, upon the final dismissal of the suit, respondents became liable to pay the differential amount. The said order is executable and can be executed under S. 145 C.P.C. ; (b) in any event, the Court has general and inherent jurisdiction to enforce the Bond; and (c) respondents are estopped from disputing the undertaking given to the Court. These points were urged by the learned counsel in order to show that the learned trial Judge has failed to exercise the jurisdiction vested in him by not enforcing the said undertaking or Bond. I will therefore address myself to the said questions seriatim.

14. As regards the first question, the learned counsel has submitted that the Order dt. 18-4-1970 has to be read with the order dated 14-8-1969 granting the injunction ex parte, since, by the said Order made on 18-4-1970, the learned trail Judge has confirmed the ex parte injunction earlier granted by him. But, being satisfied that the interests of the defendants/ petitioners herein required to be safeguarded, directed the responds not only to submit half yearly statements of the pellets exported, but also to supply suitable security for the difference of rates on the export of pellets till the final disposal of the suit. He further submitted that the respondents had executed the Bond sought to be enforced as they had been compelled to do so by the Order of the Court and this Bond was taken on record by the Order dated 15-6-1970, having been accepted by the Court, a can be seen from the Order dated 3rd February, 1976 passed by the learned Civil Judge. The learned counsel then invited my attention to the circumstance that the respondents had undertaken and bound themselves to pay to the petitioners the amount representing the difference between Rs. 1.375 and Rs. 3.35 per tonne in respect of the pellets exported by them should the suit be decided finally against them and urged that, with the final dismissal of the suit, the respondents became liable to pay the said differential amount. he further argued, placing reliance in the cases of Harendra Kumar Ghosh v. Gurupada Bhowmick : AIR1937Cal452 and Parkash Chand Mahajan v. Madan Theatres Ltd., AIR 1936 Lah. 463 that since the Bond was executed by the trial Court, the terms of the same Bond had been incorporated in the order of acceptance of the Bond. Hence, he concluded the said Order dated 18-4-1970, on its true construction, is an Order on the plaintiffs/ respondents herein to pay the said differential amount and, therefore, executable under S. 145 C.P.C.

15. It was however contended by Mr. Setalvad that the provision of S. 145 C.P.C. is not available to the petitioners in order to get enforced the aforesaid Bond. He submitted that in the case at hand only clause (c ) of S. 145 will be relevant and that from the point of view of the said clause, the operative part of S. 145 provides that an Order for the payment of money can be executed against the surety who shall be deemed to be a party within the meaning of S. 47. The object of S. 145 is to create a legal fiction providing that in certain contingencies a person furnishing a security or giving a guarantee shall be deemed to be a party within the meaning of S. 45, which is designed to avoid multiplicity of proceedings and provides that all questions arising between the parties in the suit and relating to execution and discharge or satisfaction of a decree shall be determined by the Executing Court and not by a separate suit. S. 145 further provides that the relevant Order can be executed against the person giving the guarantee or furnishing security. Thus, according to the learned counsel bearing in mind that S. 145 provides that such person shall be deemed to be a party, it becomes crystal clear that the provisions do not apply to a case where the party himself gives the guarantee or furnishes security, for, in such a case, S. 47 is attracted. Besides, S. 145 requires an order for payment of money and a security or a guarantee pertaining to such Order. The learned counsel further urged, relying in the rulings in Nadanaligi Kurugodappa v. Angadi Soogamma, AIR 1918 Mad. 661, Mt. Khairunnissa Bibi v. Oudh Commercial Bank, Fyzabad : AIR1933All269 and Sm. Kunja Moyee Dassi v. Akshoy Kumar Das, : AIR1961Cal43 , that only if such an order exists, and therefore, the undertaking or Bond executed by the respondents cannot be enforced as sought by the petitioners.

16. Section 145 C.P.C. provides that where any person has furnished security or given a guarantee, inter alia, for the payment of any money or for the fulfilment of any condition imposed on any person, under an order of the Court in any suit or in any proceeding consequent thereon, the decree or order may be executed in the manner provided for the execution of decrees, if he has rendered himself personally liable, against him to that extent and such person shall be deemed to be a party within the meaning of S. 47. It is clear from the wording of S. 145 that its scope is to entitle the person for whose benefit security was given to enforce the security by executing the decree or order against the surety or guarantor to the extent to which he has rendered himself personally liable, in the same manner as if the surety or guarantor was a party to the decree or order and was directed by the decree or order to perform the obligation undertaken by him, without having to institute a suit to enforce the security. The section thus provides for a summary remedy in execution and dispenses with the necessary of a separate suit to the extent to which the surety has rendered himself personally liable. Though this provision of law speaks of 'any person' who has furnished security or gives a guarantee and this expression may justify the view that it embraces in its meaning the parties to the suit also when they furnish security or give guarantee, I am of the firm opinion that the Section applies only where the person who gives the guarantee or furnishes security is a third party, that is, not a arty to the suit. Mr. Andhyarujina has strongly urged that this view is not correct after the 1976 Amendment to the C.P.C. In fact, he contended that the Section prior to the said Amendment read in the relevant portion 'where any person has become liable as surety..........'. This portion was substituted by the amendment and the Section now reads 'Where any person mas furnished security or given a guarantee.........'. This change was, according to the learned counsel, meant to enlarge the application of S. 145 and to bring within its ambit any person, including a party to the suit who had furnished security or given a guarantee. This construction of S. 145 does not appear to be correct, for, as rightly pointed out by Mr. Setalvad, if that was so, the expression 'and such person shall be deemed to be party within the meaning of S. 47' occurring in S. 145 and which implies that the said person is not a party to the suit, would have been given a different wording, namely 'and such person, if not a party to the suit shall be deemed to be a party within the meaning of S. 47' . I am, therefore, of the view that S. 145 applies only when security is furnished or guarantee is given by a third party and not by a party to the suit.

17. On this above ground alone, the enforcement of the bond executed by the respondents was not possible under the provisions of S. 145 C.P.C. But, in addition, there are other reasons to make unavoidable to the petitioners the recourse to Section 145 to enforce the Bond. The said provision of law, indeed, clearly implicates that the liability of the person who furnishes or gives guarantee is created and fastened on such person by an Order of the Court. Therefore, there should be an order or decree for the payment of money to attract the provisions of S. 145 C. P. C. I am fortified in this view by the rulings of the Allahabad and Calcutta High Courts in the cases of Mr. Khairunnissa Bibi v. Oudh Commercial Bank, Fyzabad : AIR1933All269 and Smt. Kunja Moyee Dassi v. Akshoy Kumar Das : AIR1961Cal43 (supra). It is necessary, as such, to consider the facts of the case before me for the purpose of seeing whether such order exists.

18. As already stated, the learned Civil Judge, Senior Division, Margao, while confirming the injunction ex parte granted by him, has directed the respondents to submit half yearly statements of the pellets exported and also to furnish 'suitable security for the amount consisting in the difference between Rs. 1.375 per tonne and Rs. 3.35 per tonne in respect of all quantities exported till the final disposal of the suit'(sic). In compliance with this direction of the learned trial Judge, respondents executed on 11-6-1970, a Bond which in its operative part reads as under :--

'Now, therefore, in pursuance to the aforesaid Order of the Civil Judge, Senior Division, Margao, dated 18th April, 1970, passed in Civil Suit No. 46 of 1969 this Bond is executed on 11th day of June, 1970 by the said obligors whereby they undertake and bind themselves to pay to the Mormugao Port Trust, Mormugao Harbour the amount representing the difference between Rs. 1.375 and Rs. 3.35 per ton in respect of the pellets exported should the final disposal of the aforesaid Suit No. 46 of 1969 be decided against the obligors, and particulars whereof shall be furnished by the obligors to the Court in half yearly statements as required by the said order.'

The said Bond was produced in Court along with an application dated 12th June, 1970, praying that the same Bond be taken on file. By Order dated 15-6-1970, the learned trial Judge ordered the said Bond to be filed and appears to nave been accepted by him, since in his Order dated 3rd February, 1976, which disposes of an application of the petitioners praying that sufficient security should be given instead of the Bond, he specifically observed that :-- 'the Bond executed by the plaintiffs has been accepted by the Court'. These being the relevant facts, it is apparent that , though a 'suitable security' was directed to be furnished for the purpose of safeguarding the interests of the petitioners and though the respondents undertook and bound themselves to pay the differential amount of the rates which should accrue till the final disposal of the suit, no order for the payment was expressly made by the trial Court, or if that matters, by the High Court. It was however contended by Mr. Andhyarujina that, by accepting the Bond executed by the respondents, the Court has incorporated the terms thereof in its order and hence, an implied order to pay exists. Reliance was placed in the rulings of the Calcutta and Lahore High Courts in the cases of Harendra Kumar Ghosh v. Gurupada Bhowmick : AIR1937Cal452 and Parkash Chand Mahajan v. Madan Theatres, Ltd., AIR 1936 Lah 463 in support of this submission. In the aforesaid case of Harendra Kumar Ghosh v. Gurupada Bhowmick, the Calcutta High Court has held the view that an application for execution against the sureties is an application for execution of a decree as by operation of S. 145, Civil P.C., the sureties become judgment- debtors under the decree. And in the case of Parkash Chand Mahajan v. Madan Theatres Ltd., the Lahore High Court held that a decree against a judgment-debtor can be executed against his surety who has, by means of a statement made before the Court, undertaken to satisfy the liability of the judgment-debtor. These two authorities in on manner help the case of the petitioners, since it is not held therein that no order for payment is necessary. I am unable to agree with the proposition of the learned counsel. In fact, only because the learned trail Judge ordered the Bond to be filed and accepted it, one cannot infer that he incorporated the terms of the Bond in his Order of acceptance thereof and impliedly ordered the payment of the difference of rates. The said order of acceptance of the Bond warrants naturally and at the most the conclusion that the learned trial Judge was satisfied that the Bond executed constituted a 'suitable security', as required by him in his Order dated 18th April, 1970. This being the case, I find that there was no order of the Court directing the respondent to pay the said difference in export rates of the pellets and, consequently, for this reason also, I hold that the provisions of Section 145 Civil P.C. were not available to the petitioners to enforce the undertaking given to the Bond executed by the respondents.

19. The next contention of the learned counsel for the petitioners has been that even if the Bond is not enforceable under S. 145 C.P.C., the court must, in the exercise of its general and inherent powers, enforce it. He urged that the Bond executed by the respondents embodies an undertaking to the Court and being a proceeding in Court, imposing a liability to be enforced in the suit against the plaintiffs/respondents herein, it was the duty of the Court to enforce such undertaking by using its inherent powers. He further argued that the said Bond is not addressed to anybody, contrary to what is required under Form II or III of the Appendix G to the Civil P.C. and, as such, the Bond and the undertaking are to the Court, being a fact that it was filed in Court and forms part or the record of the suit. Such Bond was given as a security for the difference between the rates of Rs. 1.375 and Rs. 3.35 per tonne, a difference that the petitioners could not collect as a result of the injunction Order dated 18-4-1970 and, in the circumstances, is to be enforced in the exercise of inherent powers by the Court, lest it will discredit it. And to strengthen his above submissions, the learned counsel placed reliance on the rulings of the Privy Council in Sadasiva Pillai v. Ramalinga Pillai, (1875) 2 IA 219 and Raj Raghubar Singh v. Jai Indra Bahadur Singh, AIR 1919 P.C. 55, or the Madras High Court in Sankunni Variar v. Vasudeva Nambudripad, AIR 1926 Mad 1005, Kunhi Moidin v. Kunhi Koman Nair, AIR 1933 Mad 691 and Muthuswami Pillai v. Manikka Moopan : AIR1936Mad990 of the Travancore-Cochin High Court in Ouseph Korathu v. Gopalan Nair, AIR 1952 TC 237 and of the Kerala High Court in Krishnan v. Dorarajan Chettiar, : AIR1980Ker234 .

20. It is not necessary to make a detailed reference to the above authorities relied upon by Mr. Andhyarujina. It suffices to say that in all those cases there was an undertaking given to the Court to do something should the suit be decided against the party who had given the undertaking. In each of the said cases, the Courts consistently and firmly held that, though the undertaking could not be enforced under S. 145 Civil P.C. and in the case of Sadasiva Pillai v. Ramalinga pillai (above) under S. 11 of the Act XXIII of 1861, the same had to be enforced by the Court by exercising its inherent powers. Mr. Setalvad sought to distinguish the above authorities from the case before me. He contended that, unlike what happens in our case, no remedy was available to the parties in those cases to enforce the undertaking and hence, the Courts had felt it necessary to take recourse to inherent powers. He further urged that, as held by a Full Bench of the Allahabad High Court in Mt. Khairunnissa Bibi v. Oudh Commercial Bank, Fyzabad : AIR1935All269 the proper remedy is to file a suit. These submission s of Mr. Setalvad however have, in my view, no force. First of all, the authority of Khairunnissa Bibi is clearly not applicable to our case, since therein the Bond, unlike the Bond executed by the respondents, was not given to the Court. Secondly, the ratio behind the above authorities of the Privy Council, Madras, Travancore-Cochin in Kerala High Courts is that in the event an undertaking is given to the Court, the decree-holder or the Court should not be compelled to file a separate suit to get the undertaking executed, and thus, it is not correct to say that the enforcement of the Bond was ordered in exercise of inherent powers only because, in the cases before the said Courts, there was no other way to enforce the undertaking. I am fortified in this view by the observations made in Sankunni Variar v. Vasudeva Nambudripad, AIR 1926 Mad 1005 to the effect that :--

'It would be very roundabout proceeding to compel either the Court or the decree holder, both or whom have been prejudiced by the conduct of the sureties, to proceed by way of a separate suit. The Court should itself order the execution of its own order for security in the original proceedings rather than tell the successful party to file another suit. There is no reason why a valuable right given to a holder or security should be frittered away by the hazards and delays of another separate suit.''

21. Undoubtedly, the Bond executed by the respondents was given to the Court and it embodies a clear undertaking given to the Court to pay to the petitioners the difference in the rates of export of pellets should the suit be finally decided against them, original plaintiffs. This flows from the circumstances in which the Bond was given, the manner of its execution and other attendant facts. Indeed, the Bond was given in compliance with the order of the learned trial Judge to safeguard the interests of the petitioners and to suitably guarantee the payment of the difference of the pellets export in the event the suit was decided finally against the respondents. It was not executed in the manner or in the form prescribed in the Appendix G to the Civil P.C., namely it was not addressed to somebody. Finally, it was, on the application of the respondents themselves, filed in and accepted by the Court, being a part of the records of the Suit No. 46/1969. This being so and since the acceptance thereof by implication shows that the learned trial Judge was satisfied that such Bond constituted a 'suitable security' as required by him to guarantee the payment of the difference of pellets export rates, it cannot be gainsaid that the undertaking and the Bond were given and executed to the Court. The said 'suitable security' was ordered by the learned trial Judge to be given, while confirming the ex parte injunction, for the purpose of restraining the petitioners from recovering the enhanced rates and from acing under the provisions of S. 59 and 61 of the Major Port Trusts Act, 1963. The respondents undertook and bound themselves to pay the difference in the disputed rates of pellets export should the suit be finally disposed against them. Now, since the Suit No. 46/1969 was disposed of and its final outcome is against the respondents, the latter cannot turn round and refuse to satisfy the solemn undertaking given to the Court, forcing thereby the petitioners, who had been prejudiced in not collecting the enhanced rates, to file a separate suit with all the hazards and delays. Further, the valuable rights given to the petitioners by such undertaking cannot be taken away, making them to face, in a fresh suit, a case that the claim for differential amount between the disputed rates is barred by limitation. Hence, in a situation like this, it is obvious that the Court has to enforce the undertaking without recourse to a separate suit and by exercising its inherent powers. As aptly observed by the learned Judge of the Madras High Court in Sankunni Variar's case AIR 1926 Mad 1005 (above) it would be anomalous that when the Court has granted indulgence to the judgment-debtor upon terms, that Court should not be able to enforce those terms without recourse to a separate suit, for otherwise, I may say borrowing the expression from Sadasiva Pillai's case 1875 2 IA 219 (above), the result would be 'discreditable to the administration of justice'. In the view I have taken, I find therefore that by refusing to act in the exercise of its inherent jurisdiction to enforce the Bond and undertaking given by the respondents, the learned Civil Judge, Senior Division , Margao has failed to exercise a jurisdiction vested in him and this may cause a failure of justice and occasion an irreparable injury to the petitioners.

22. Mr. Setalvad however, contended that , in any event, the aforesaid Bond has ceased to subsist on the day the suit was decreed by the learned trial Judge, that is, on 31st March, 1978. He argued that the said Bond, having been given in pursuance of the injunction Order dated 18th April, 1970, came to an end and became enforceable after 31st March, 1978, being a fact that the petitioners did knot make any effort to keep such bond alive. Reliance was placed in support of this contention in the decisions of the Calcutta High Court in Ram Chand v. Pitam Mal, ILR 10 All 506 and Yamin-ud-Dowlah v. Amed Ali Khan ILR (1894) 21 Cal 561. This submission has obviously no force. In fact, it is common ground that, after the passing of the judgment dated 31st March, 1978, the petitioners preferred an appeal against the said judgment and decree. This appeal was allowed on 21st March, 1983 by a Division Bench of this Court and the Special Leave Petition filed by the respondents in the Supreme Court was dismissed. The respondents bound themselves and undertook to pay the difference of rates should the suit be decided finally against them. Now, it is well settled that the appeal is a continuation of the suit and, hence, in the circumstances, it would be totally erroneous to accept the view of Mr. Setalvad. It may also be pointed out that the authorities relied upon by the learned counsel in this connection are not attracted, since unlike in our case, there were no Bonds or Securities given until the final disposal of the suit, and that, in any case, upon the ordinary principles of estoppel, the respondents cannot now take the stand that they are not liable for the amount they undertook to pay under the said Bond

23. In this view of the matter, this revision application succeeds. In the result, therefore, the impugned Order dated 21st December, 1983 passed by the learned Civil Judge, Senior Division, Margao is set aside and it is ordered that the learned Judge, in exercise of its inherent powers, should look into the application filed by the petitioners for the enforcement of the Bond executed by the respondents and of the undertaking given by them in the Suit No. 46/1969 to pay the differential amount between the rates of Rs. 1.375 and 3.35 and, thereafter, dispose of the said application in accordance with law. Costs by the respondents.

24. Mr. Tamba, learned counsel appearing for the respondents seeks for a certificate of fitness to appeal to the Supreme Court. Since no substantial law of general importance arises, the certificate of fitness is refused.

25. Revision allowed.


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