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N. Kullayyappa and anr. Vs. N. Dastagiri Saheb - Court Judgment

LegalCrystal Citation
SubjectContract
CourtAndhra Pradesh High Court
Decided On
Case NumberC.R.P. No. 4917 of 1981
Judge
Reported inAIR1982AP154
ActsCode of Civil Procedure (CPC), 1908 - Sections 11 and 47; Contract Act, 1872 - Sections 74
AppellantN. Kullayyappa and anr.
RespondentN. Dastagiri Saheb
Excerpt:
contract - compromise decree - section 74 of contract act, 1872 and sections 11 and 47 of code of civil procedure, 1908 - respondents have filed present petition stating that compromise decree was only for rs.16000 in full quittance of suit claim - where concession has been given it must be performed within time and court has no power to relieve party against it - what was granted to appellant under decree was only a concession and it is not a penalty - held, appellants could not invoke benefit of section 74 and since appellants did not raise this issue in early execution proceedings it cannot be raised here on principles of res judicata. - - it is clearly distinguishable. (2) that in case the first defendant failed to pay the amount within the stipulated time as per cl......with future interest at 6% p.a. on rs. 21,110 from the date of the suit till realisation, and suit costs of rs. 1251-50. 2. admittedly, the petitioners did not pay rs. 16,000/- and costs by 28th mar. 1975. therefore, the respondent levied execution for recovering the entire suit amount of rs. 16,443-50 with costs and future interest. the properties of the petitioners were brought to sale. the petitioners went on making some payments and getting the sale adjourned by filing petitions. ultimately, the sale was held. the petitioners filed a petition to set aside the sale. that petition was dismissed for default. 3. thereafter the petitioners have filed the present petition stating that the compromise decree was only for rs. 16,000/- in full quittance of the suit claim, the balance.....
Judgment:
ORDER

1. The respondent filed a suit against the petitioners for realisation of Rs. 16,443-50 with costs and future interest. Both the parties compromised the matter and a decree was passed in terms of the compromise on 26th Dec. 1974. According to the decree the petitioners have to pay to the respondent a sum of Rs. 16,000/- towards the suit amount and costs by 28th March 1975 and in default of payment by that date the petitioners have to pay the entire suit amount of Rs. 16,443-50 with future interest at 6% P.A. on Rs. 21,110 from the date of the suit till realisation, and suit costs of Rs. 1251-50.

2. Admittedly, the petitioners did not pay Rs. 16,000/- and costs by 28th Mar. 1975. Therefore, the respondent levied execution for recovering the entire suit amount of Rs. 16,443-50 with costs and future interest. The properties of the petitioners were brought to sale. The petitioners went on making some payments and getting the sale adjourned by filing petitions. Ultimately, the sale was held. The petitioners filed a petition to set aside the sale. That petition was dismissed for default.

3. Thereafter the petitioners have filed the present petition stating that the compromise decree was only for Rs. 16,000/- in full quittance of the suit claim, the balance having been given up by the respondent, that the default clause has not the effect of reviving the right of the respondent to recover the entire suit amount with future interest and costs and that would amount to a penal clause and the petitioners are to get relieved of the penalty by virtue of S. 74 of the Contract Act. In this connection reliance was placed on S. Krishnamurthy v. P. Appanna (1976) 2 Andh WR(HC) 103.

4. The learned Subordinate Judge held that the decision had no application to the facts of the case. In addition, he also held that the petition was barred by principles of res judicata. Consequently he dismissed the petition. Questioning his order the petitioners have filed this revision.

5. It is submitted by the learned counsel for the petitioners that the learned Judge was not correct in stating that the decision in S. Krishnamurthy v.P.Appanna (1976-2 Andh WR(HC) 103) (supra) did not apply to the facts of the case. It is clearly distinguishable. In that case the compromise decree was as follows:

'(1) that the first defendant do pay to the plaintiff within a period of two months from the date of the decree a sum of Rs. 1,800/- in full quits of the suit claim as settled by the mediators giving up the remaining suit claim and costs and the first defendant do bear his own costs of the suit.

(2) that in case the first defendant failed to pay the amount within the stipulated time as per cl.(1) above the plaintiff do recover from the defendant, i.e., the first and 3 to 5 defendants, as claimed in the suit a sum of Rs. 2,500/- at 5 1/2% P.A. from the date of the suit i.e., 19th January, 1970 till the date of realisation of the said sum and do also recover the sum of Rs. 420/- towards costs of the suit.'

The first defendant did not pay the amount of Rs.1800/- stipulated in the compromise decree within the period of two months. Thereupon the decree holder (the plaintiff) filed an execution petition for realisation of the entire amount claimed in the suit.

6. On consideration of the case-law on the subject Venkatrama Sastry, J., held that where a concession was given to a party it must be performed within the time stipulated and there is no power in the Court to relieve the party against it. On the other hand where stipulation is by way of a penalty, the decree in each case has to be scrutinised and if it is found to be by way of a penalty, then relief should be given under S. 74 of the Contract Act . On the facts of that case the learned Judge held that the decree stipulated for the payment of Rs. 1,800/- the balance of the suit claim having been given up by the decree holder, on the date of the compromise decree itself and by virtue of the second clause the amount that was given up has not been resuscitated or revived. It, therefore amounts to a penalty and it was not a concession granted under the decree. Consequently, he held that the provisions of S. 74 of the Contract Act are attracted and the judgement debtor was entitled to the relief under the provisions of that Act.

7. But that is not the position here. In the present case the respondents did not agree to receive Rs.16,000/- in full quittance of the suit claim. What was granted to the petitioner under the decree was only a concession. Therefore, it is not a penalty and the petitioners could not invoke the benefit of S. 74 of the Contract Act.

8. Apart from that I also agree with the learned Subordinate Judge that since the petitioners did not raise this question in the early execution proceedings they cannot raise it in this petition on the principles of res judicata. Consequently. I dismiss this petition.

9. Petition dismissed.


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