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H.C. Veera Reddy Vs. Rathilal Chimanlal Shah and ors. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtAndhra Pradesh High Court
Decided On
Case NumberCivil Revn. Petn. No. 788 of 1977
Judge
Reported inAIR1978AP407
ActsCode of Civil Procedure (CPC), 1908 - Sections 2(2), 96 and 115 - Order 20, Rule 15
AppellantH.C. Veera Reddy
RespondentRathilal Chimanlal Shah and ors.
Appellant AdvocateAdv. General ;for M.O. Audinarayana Reddy, Adv.
Respondent AdvocateG.V.R. Mohan Rao and ;Y.B. Tata Rao, Advs.
Excerpt:
.....15 of code of civil procedure, 1908 - revision petition against order dismissing application for final decree in suit for dissolution of partnership - petitioner claimed certain amounts under compromise preliminary decree in suit - lower court also referred petitioner to separate suit instead of determining claim in application - claim for amount not a separate cause from dissolution - no cause to file a separate suit - held, order of dismissal without adjudicating claims not justified. - - tata rao, seeks strong support from the decision of the madras high court in g. 13. then there remains the questions whether the learned subordinate judge has failed to exercise the jurisdiction vested in him in referring the petitioner to a separate suit instead of deciding the claim. in the..........that civil revision petition arose out of another application i.a. no. 215 of 1972 in the same suit filed by the 5th respondent 4th defendant in pursuance of the compromise decree for the issue of a cheque for rs. 75,000/- in his favour. that application had been opposed by the petitioner herein the ground that the 5th respondent was due to the firm in a sum of rs. 18,500/- and therefore it had to be deducted before payment of the amount due to the 5th respondent. in that application, as in the present application, the defence of the 5th respondent was that he had paid this amount under ex. a-1 to the plaintiff 1st respondent because it was an amount due to the firm. but the petitioner filed an affidavit of the first respondent to the effect that, that amount was not paid to him at.....
Judgment:
ORDER

1. This revision petition arises out of an order passed by the Subordinate Judge, Adoni, dismissing a application I. A. No. 377 of 1976 in O. S. No. 44 of 1970. The application was filed under O. 20 R. 15 c. p. c. for passing a final decree in the suit which is one for dissolution of partnership.

2. The 5th defendant in the suit is the petitioner. The first respondent is the plaintiff in the suit. He filed the suit for rendition of accounts and for dissolution of partnership in respect of the firm run under the name and style of 'Vishnu Cotton Ginning Pressing Factory,' The parties entered into a compromise and a preliminary decree was passed on 22-4-1972 in accordance with the terms of the compromise. Under the terms of the compromise, the petitioner became the absolute and exclusive owner of the factory and other assets of the firm. He also became entitled to the outstanding dues to the firm and also any money that has been paid by him or become due and payable by the petitioner. The fifth clause in the compromise decree which is relevant for the purpose of this revision petition is as follows:-

'That the accounts of the factory having been approved by all the defendants except 6th defendant the income and expenditure will be deducted from the amount shown as per their share and balance only will be drawn by the respective parties in the court, that the expenditure for sales tax, income taxes dues can be looked into by all the parties and apportioned between them.'

3. The accounts of the firm show a debit entry of Rs. 18,522/- against the account of the 5th respondent 4th defendant. Under the preliminary compromise decree the petitioner is entitled to recover the amount due by the 5th respondent. At the time of dissolution of the firm, the firm was liable to pay electricity charges, municipal taxes et, Under cl. 5 of the compromise decree the income and expenditure shall have to be deducted from the amount shown as per their respective shares and the respective parties will have to draw the balance from the application for the passing of the final decree in terms of the cl. 5 of the preliminary decree against the 5th respondent for an amount of Rs. 25,227-50 and against respondents 7 and 8 for Rs. 1,111/-. The 5th respondent alone opposed the application was not maintainable in law, that the application was barred by the principals of res judicata since the application I. A. No. 215 of 1972 for the appointment of a Commissioner and for passing of the final decree was already dismissed and the same was also confirmed by the High Court in A. S. No. 501 of 1973. It was further pleaded that the amount due by the 5th respondent was paid to the first respondent personally in his personal account and in proof of discharge of the said debt he obtained a receipt from the 1st respondent and the same was also filed into Court in I. A. No. 215 of 1972. It was, therefore, contended that the petitioner was not entitled for a decree for Rs. 18,552/-

4. The first respondent did not file any counter. The other respondents remained ex parte.

5. The learned Subordinate Judge framed the following two points for decision:-

1. Whether the present petition is barred by principles of res judicata.

2. Whether the petitioner is entitled to final decree seeking the relief which he has prayed for.

6. On the first point the learned Subordinate Judge held that there is nothing in the Code which prohibits the Court from passing one or more final decrees to completely dispose of the suit and that the decision of the High Court in dismissing the appeal A. S. No. 501 of 1973 preferred against the orders in I. A. No. 38 of 1973 did not operate as res judicata. However, on the second point, the learned Subordinate Judge observed that since the other disputes between the parties have been completely disposed of, the only dispute between the petitioner and the 5th respondent as regard the liability of the 5th respondent for a sum of Rs. 18,500/- cannot be gone into at this stage and that the petitioner was at liberty to file a separate suit against the 5th respondent. Accordingly, he dismissed the petition. Hence this revision petition.

7. It is contended by the learned Advocate General, appearing for the petitioner that having rightly held that one or more final decrees can be passed in a suit to finally adjudicate the dispute between the parties, the Court below erred in dismissing the application on the ground that the petitioner was at liberty to file a separate suit without going into the merits of the application. He placed great reliance on the observations of Venkatarama Sastry, J., in C. R. P. No. 1329 of 1973 (Andh Pra). That Civil Revision Petition arose out of another application I.A. No. 215 of 1972 in the same suit filed by the 5th respondent 4th defendant in pursuance of the compromise decree for the issue of a cheque for Rs. 75,000/- in his favour. That application had been opposed by the petitioner herein the ground that the 5th respondent was due to the firm in a sum of Rs. 18,500/- and therefore it had to be deducted before payment of the amount due to the 5th respondent. In that application, as in the present application, the defence of the 5th respondent was that he had paid this amount under Ex. A-1 to the plaintiff 1st respondent because it was an amount due to the firm. But the petitioner filed an affidavit of the first respondent to the effect that, that amount was not paid to him at all. The lower Court in that application also held that the 5th respondent could only agitate the matter in separate suit. Venkatarama Sastry , J. held:

'These are all matters, which have got to be looked into and finally adjusted before the amounts are really paid our to the respective parties. It was not altogether a separate cause of action as was held by the lower Court. There was, therefore, no necessity for driving the petitioner to separate suit, when the petitioner was able to file elaborate evidence about this transaction. The lower Court was, therefore, not justified in my opinion in rejecting this claim and in directing the 4th defendant to draw out the said sum of Rs. 18,500/- and furnishing third party security.'

8. Therefore, it is argued by the learned Advocate General that the lower Court was not right in dismissing the application filed by the petitioner referring him to a separate suit in respect of the claim of this very same sum of Rs. 18,500/-.

9. The learned counsel for the 5th respondent, however, raised a preliminary objection to the maintainability of the revision petition. His objection is that the order sought to be revised is appealable and a revision petition is not maintainable. It is, therefore, necessary to examine the soundness of the preliminary objection before embarking upon the consideration of the merits of the contentions of a learned Advocate General.

10. The question is whether the dismissal of an application for final decree under O. XX R. 15 C. P. C., is a decree in the suit and is, therefore, appealable as a decree under S. 96 C. P. C. The learned Counsel for the 5th respondent Mr. Y. B. Tata Rao, seeks strong support from the decision of the Madras High Court in G. Subbayya v. K.Venkata Hanumantha Bhushana Rao, AIR 1941 Mad 817, wherein Wadsworth and Patanjalli Sastry, JJ replying upon two earlier decisions of the Madras High Court in Subbalakshmi Ammanl v. Rama Linga Chetti (1919) ILR 42 Mad 52 : (AIR 1919 Mad 709) and Venkataiah v. Venkatasubbaiah AIR 1922 Mad 65 held that the dismissal of an application for a final decree in a suit for sale on a mortgage is appealable as a decree under S. 96 C. P. C. and is not open to revision under S. 115 C. P. C.

11. In that case, the learned Judges were concerned with an application dismissed under O.34, R.5 C.P.C. in a suit for sale on mortgage. The effect of an order passed under O. 34, R. 5 C.P.C. is to dismiss the plaintiff's suit for the realisation of the mortgage money by sale of the mortgaged property. It is, therefore a final adjudication in the suit determining the rights of the parties and, therefore, fall within the definition of the decree under S. 2 (2) C. P. C. Therefore , it was rightly held that an appeal lies against such an order.

12. An application filed under O. 20 R. 15 C. P. C. for the passing of the final decree is an interlocutory application in the suit itself. The directions in the preliminary decree are merely sought to be carried out and the proceedings are in the nature of continuation of the suit. The dismissal of such an application for carrying out the directions in a clause of the final (preliminary?) decree does not finally dispose the suit itself and is, therefore not a 'decree' against which an appeal lies under S. 96 C. P. C. In this context the decision referred to by the learned Advocate General in Ramanathan Chetty v. Alagappa Chetty, AIR 1930 Mad 528 may be some relevance. In that case, Curgenven, J., observed that the proceeding which take place between the two decrees (preliminary decree and final decree) are in the nature of continuation of the suit for the purpose of carrying out the directions contained in preliminary decree. In that case, a revision petition filed under S. 115 C. P. C. alone was entertained against an order passed in an application under O. 20, R. 20 C.P.C. In this case also the application filed by the petitioner was merely to decide the rights and obligations of the parties under Cl. 5 of the preliminary decree. The learned Subordinate Judge dismissed the application. I have no hesitation to hold that the order passed by the Court below is not a decree. Therefore the Civil Revision Petition is maintainable.

13. Then there remains the questions whether the learned Subordinate Judge has failed to exercise the jurisdiction vested in him in referring the petitioner to a separate suit instead of deciding the claim. The petitioner specifically claimed the amounts as due and realisable under Cl. 5 of the compromise preliminary decree in the suit. The plea of the respondent was that he paid the amount to the first respondent personally in his personal account and that in proof of the discharge of the said amount he obtained a receipt from the first respondent. It was therefore, his contention that the he was not liable to pay the amount of Rs. 18,500/- to the petitioner. But the petitioner filed an affidavit of the 1st respondent himself to the effect that he received no such payment. This Court in C. R. P. No.1329 of 1973 on an earlier occasion considering the very same plea held that it was not a separate cause of action to drive the petitioner to a separate suit and the lower Court was not, therefore justified in rejecting the claim. All the necessary evidence was already adduced. There is no further evidence that could be adduced in respect of the subject matter of the claim. In the circumstances, it must be held that the learned Subordinate Judge failed to exercise his jurisdiction in referring the petitioner to a separate suit instead of determining the claim in the application. The order of the learned Subordinate Judge dismissing the application I. A. No. 377 or 1976 in O. S. No. 44 of 1970 is set aside. The Subordinate Judge shall now restore the said application to file and dispose it of afresh according the law in the light of the aforesaid observations.

14. The Civil Revision Petition is accordingly allowed. No Costs.

15. Revision Allowed.


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