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Pagadala Chengayya and anr. Vs. Noothanakalva Chenga Reddy - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtAndhra Pradesh High Court
Decided On
Case NumberA.A.A.O. No. 46 of 1954
Judge
Reported inAIR1959AP632
ActsCode of Civil Procedure (CPC) , 1908 - Order 21, Rule 2(2)
AppellantPagadala Chengayya and anr.
RespondentNoothanakalva Chenga Reddy
Appellant AdvocateD. Narasa Raju, Adv. General, ;G. Chandrasekhara Sastry, ;D. Venkatappaiah Sastry and ;P.V. Rama Rao, Advs.
Respondent AdvocateM.S. Ramachandra Rao, Adv.
Excerpt:
.....rule 2 (2) - essentials of order 21 rule 2 (2) being intimation to court within specified time - decree holder also given opportunity to put case before court - order 21 rule 2 (2) duly complied with - held, counter petition could be treated as application under order 21 rule 2 (2). - all india services act, 1951.sections 8 & 11 & a.p. buildings (lease, rent and eviction) control rules, 1961, rule 5: [v.v.s. rao, g. yethirajulu & g. bhavani prasad, jj] refusal by landlord to receive rent - deposit of rent in court - held, a tenant has the option to take recourse to section 8 in case of refusal or evasion by landlord to receive rent and if landlord were to not name a bank or refuse even the money order of rent, the tenant can deposit the rent in accordance with sub-rules (1) to (3)..........a counter filed by the judgment-debtor within 90 days, in answer to an execution petition of the decree-holder, raising a plea of satisfaction or adjustment of a decree would fulfil the requirements of order xxi rule 2 c. p. c. 2. the facts material for the purpose of this enquiry may be stated briefly. the respondent-laid an action for the recovery of certain items of property from the appellants, who are defendants 4 and 5 and some others. the suit was dismissed with costs of the appellants and this was affirmed on appeal. the appellants put into execution the decree for costs in their favour. this was resisted by the respondent on the ground that there was an adjustment of the decree on 14-9-1952 when the 4th defendant for himself and as repre-senting his brother, the 5th defendant,.....
Judgment:

P. Chandra Reddy, C.J.

1. The question to be answered by the Full Bench is whether a counter filed by the judgment-debtor within 90 days, in answer to an execution petition of the decree-holder, raising a plea of satisfaction or adjustment of a decree would fulfil the requirements of Order XXI Rule 2 C. P. C.

2. The facts material for the purpose of this enquiry may be stated briefly. The respondent-laid an action for the recovery of certain items of property from the appellants, who are defendants 4 and 5 and some others. The suit was dismissed with costs of the appellants and this was affirmed on appeal. The appellants put into execution the decree for costs in their favour. This was resisted by the respondent on the ground that there was an adjustment of the decree on 14-9-1952 when the 4th defendant for himself and as repre-senting his brother, the 5th defendant, received Rs. 1200/-, Rs. 1000/- being the price of two items of property to be conveyed to them and Rs, 200/-towards full satisfaction of the costs in ths suit and executed Ex, B-l as evidencing this agreement.

The agreement was assailed as a forged document. This objection was overruled by the trial Court, which found that Ex. B-l was a genuine document and that the adjustment pleaded was true. In the result, the trial Court dismissed the petition. In the appeal by the aggrieved plaintiff, a further contention was raised on his behalf that the alleged payment could not be called in aid by the judgment-debtors since there was no appli-cation for recording satisfaction or adjustment within the meaning of Order XXI Rule 2 C, P. C.

The lower appellate court disallowed this plea as also the one bearing on the truth of the agreement. It is that order that is now under appeal now.

3. In this appeal, the view of the District Judge as regards the construction of Order XXI Rule 2 is canvassed. It js urged that there is no scope for treating an objection petition as an application within the ambit fit Order XXI Rule 2 C. P. C., having regard to its language. A judgment-debtor who seeks certification of the payments made by him, should conform to the provisions of that order strictly. In the absence of an application in that behalf the Court is precluded from enquiring into the truth or otherwise of the alleged satisfaction or adjustment of the decree, continues learned Counsel. The answer of the Counsel for the respondent is that the objections embodying the plea of satisfaction would serve the purpose of Order XXI Rule 2 and when once it is brought to the notice of the Court, it is bound to investigate into the matter.

4. In order to appreciate the relative contentions, it is necessary to read the terms of Rule 2) of Order XXI C. P. C. :

Order XXI Rule 2 as amended in Madras runs thus :

'1. Where any money payable under a decree of any kind is paid out or Court, or the decree is otherwise adjusted in whole or in part to the satisfaction of the decree-holder, the decree-holder shall certify such payment or adjustment to the court whose duty it is to execute the decree, and the court shall record the same accordingly.

2. Any party to the suit or his legal representative or any person who has become surety for the decree-debt also may inform the Court of such payment or adjustment, and apply to the Court to issue a notice to the decree-holder to show cause, on a day to be fixed by the Court, why such payment or adjustment should not be recorded as certified; and if, after service of such notice, the decree-holder, fails to show cause why the payment or adjustment should not be recorded as certified, tho Court shall record the same accordingly.

3. A payment or adjustment, which has not been certified or recorded as aforesaid shall not be recognised by any court executing the decree.'

5. Thus, where money payable under a decree is paid out of court, an obligation is cast on the decree-holder to certify the payment. If, however, he fails to carry out his duty, the judgment-debtor is provided an opportunity by Sub-rule 2 to inform the court of the payment made by him or of any adjustment effected. But the procedure indicated in this sub-rule is different from that of Sub-rule I. Sub-rule (1) lays down a simple procedure of certification of payment by decree-holder, whereas under Sub-rule 2 notice must issue to the decree-holder to afford an opportunity to him to appear and to contest the request for certification. If the payments are not recorded as contemplated by Sub-rule 1 or 2, the execution Court is precluded from recognising such payments or adjustments by reason of sub-r. 3.

6. It is seen that Sub-rule 2 only talks of the judgment-debtor informing the court of the payments or adjustments. No particular mode of giving the information in that regard is prescribed by that rule. All that is needed is that he should bring the payments or the adjustments to the notice of the Court within the time prescribed by Article 174 of the Limitation Act, which fixes 90 days for that purpose. The object of this rule, read with Article 174 of the Limitation Act, is to discourage judgment-debtors from prolonging execution petitions by setting up old payments. Disputes regarding adjustment or satisfaction should be settled as early as possible to avoid stale claims being advanced by a judgment-debtor in that regard. It is to ensure that the executing Court is not troubled with controversies relating to payments or adjustments, which are not certified or recorded, that this rule was enacted.

It is significant, that Article 174 governs only Order 21 Rule 2(2). There is no specific provision for certification to be made by a decree-holder within a given time. That, in our opinion, denotes the aim and the object of the provisions of Order 21 Rule 2. If, therefore, a judgment-debtor gives information to the Court about the payments or adjustments made by him within the time allowed by law the Court has to hold an enquiry into the matter and issue notice to the decree-holder. Notice to the decree-holder is imperative since any determination behind his back is not valid.

7. Therefore, the two essential conditions of this order are that intimation should be given to the Court within the specified time and that the decree-holder is given an opportunity to put his case before Court. We do not find anything in the language of that rule which prevents the information envisaged in that rule being presented by means of an objection petition. Nor is any, form prescribed for applying to a Court to issue a notice to the decree-holder for the purpose set out in that rule. There is no definition of 'application' in the Civil Procedure Code. 'Application' as defined in Rule 3 Sub-rule 2 of the Civil Rules of Practice and Circular Orders, Vol. 1, contemplates an oral application also.

Be that as it may, as we have already indicated, the intendment of that rale is that the decree-holder should have notice of the request of the judgment-debtor to have the payments or adjustments recorded by the Court. Therefore, when a counter contains a plea of satisfaction or adjustment of the decree and that is served on the decree-holder, who is thus afforded an opportunity to show cause against such certification, there is substantial compliance with the terms of Order 21 Rule 2 C. P. C. If these two essential elements are present, it could be treated as a substantive application.

8. These provisions were the subject of judicial scrutiny. A Bench of the Madras High Court expressed (he opinion in Alathoor Badruddin v. Gulam Moideen, 24 Mad LJ 541 that S. 258(3). which corresponds to Order 21 Rule 2(2) was applicable where in answer to an application for execution an adjustment was set up by the judgment-debtor. It is true that it was obiter since the learned Judges disallowed the plea of the judgment-debtor in view of the fact that it was raised long after the lapse of 90 days. All the same principle is stated there which is useful in this inquiry. It is indicated in the judgment that it was open to the judgment-debtor to take steps to compel the judgment-creditor to certify the adjustment within 90 days allowed to him by law.

9. As embodying a proposition contrary to this, Lodd Govindoss v. Ramadoss Vishun Doss, 24 Mad LJ 88 is cited to us by the Counsel for the appellants. The learned Judges, who decided it, distinguished 24 Mad LJ 541 on the ground that the observations therein had reference to the facts of the particular case. They felt that to treat an affidavit as an application was to ignore the language of Order 21 Rule 2(2), which required notice to show cause against recording satisfaction of the decree.

They then remarked that they did not feel disposed io grant an indulgence to the judgment-debtor of treating his counter-affidavit as a substantive application under Order 21 Rule 2 C. P. C which implies that the Court has got power to treat such a counter-affidavit as a substantive application, which power could be exercised in deserving cases. What seems to have weighed with them in refusing to grant such an indulgence seems to be that the judgment-debtor in that case was still in time and could take action if he thought it fit. Thus, this case cannot be said to be a definite pronouncement on the other side of the line.

10. The principle enunciated by Sundara Aiyar and Ayling JJ., in 24 Mad LJ 541 (supra) was affirmed by Covinda Menon and Panchapakesa Ayyar JJ., in Kanciaswami v. Narasimha Aiyar, : AIR1952Mad582 . There is a very instructive discussion, on the subject in Chandi Charan v. Pancha-iian Pandit, AIR 1930 Pat 526. The Bench consisting of Jwala Prasad and Dhavle JJ., ruled that the judgment-debtor could set up satisfaction or adjustment of the decree by way of a counter-petition as a liar to the execution petition filed by the decree-holder, provided it was done within the prescribed period.

In the judgment of their Lordships, when once the Court is informed of such payments or adjustments, it is not only open to the Court but also incumbent upon it to treat the judgment-debtor's petition of objection as an application under Sub-rule 2 so that Sub-rule. 3, the purport of which had already been given, may not come into play. The observations of the learned Judges occurring at page 527 are apposite in this context.

'It is not as if the law had left the decree-holder free from any obligation in the matter. Sub-rule (I) imperatively required him to certify the payment, and if no specific period of limitation is prescribed for this -- as there is under Article 174 Limitation Act, for the judgment-debtor's application for the issue of a notice to the decree-holder -- the decree-holder was required under Sub-rule 2 item (e) of Order 21 Rule 11, to mention the payment in his application for execution. The de-cree-holder therefore acted contrary to law in omitting to mention the payment in his application for execution. It is the duty of a court to oppose a fraud.. .......'

11. This view is shared by the Rangoon High Court in Firm P. Rule P. L Chetty v Lon Pow, AIR 1923 Rang 103 and Maung Tin v. Ma Mi, AIR 1928 Rang 62.

12. The rulings of the Bombay High Court also are in consonance with the above statement of law. In Kalyanji Dhana v. Dharamsi Dhana and Co., AIR 1935 Bom 303, Broomfield J., opined that a written statement filed by a judgment-debtor objecting to the execution of the decree was sufficient compliance with the terms of Order 21 Rule 2(2), provided it was filed within 90 days.

13. Other instances of this principle are furnished by Ganga Dinal Rai v. Ram Oudh, AIR 1929 All 79 and Abid Hussain v. Kunj Behari Lal, AIR 1939 All 581. In the first of the two cases, Sulaiman Offg. C. J., held that an application by a judgment-debtor praying for an adjustment to be recorded need not be a document separate from the objections filed by him on the ground of such adjustment. This was followed in the second of the two cases. In this connection it may be menturned that a much earlier decision of that Court In Khushal Singh v. Midai Lal, 1881 All WN 168, which interpreted Section 258 of the Code of 1882 corresponding to Order 21 Rule 2, embodied the same rule. The following observations occurring in the judgment there are pertinent;

'It would lead to a failure of justice to refuse to give effect to the application under Section 258 and to recognise the payment, merely because the application did not, in express words, ask that notice to the respondent should issue, and formal notice had not been served. The lower appellate Court must determine on the merit whether the payment has been made, and is therefore fit to be recorded as certified and to be recognised and whether the decree has been satisfied.'

14. A decision of the Calcutta High Court in Bajrang Behari Lal v. Lachmi Narain, 13 Ind Cas 944 called in aid by the appellants, is in conflict with the rules stated above. It was there held that the objections of the judgment-debtor could not be treated as an application under Section 258 corresponding to Order 21 Rule 2(2) C. P. C.

15. Another case cited by the Counsel for the appellants in support of his argument is Shri Prakash v. Allahabad Bank Ltd., AIR 1929 PC 19. According to the Counsel for the appellants, the following passage substantiates his proposition;

'Sub-rule 2 therefore does contemplate an application by the judgment-debtor; further, it provides for notice being given to the decree-holder, it affords an opportunity for the decree-holder to appear and it involves a judicial decision by the court whether the payment should be recorded.' We do not think that this pronouncement of the Privy Council renders any assistance to the appellants. The question that arose for consideration there was whether a certification of payment by R decree-holder under Order 21 Rule 2(1) would amount to a step in aid of execution within the scope of Article 181 of the Limitation Act and would save limitation. The Judicial Committee answered it in the negative. Their Lordships pointed out that Sub-rule 1 of Rule 2 of Order 21 did not contemplate any application and that fact that the certification was made in a document styled 'an application' and was in the form of a petition would not alter the real nature of the procedure and convert what was really a mere certificate of payment into an application within the ambit of Article 181 of Limitation Act. The remarks extracted above have to be understood in the context of the question that fell to be decided there. It was only in contrasting the procedure indicated in Sub-rule 2 with that in Sub-rule 1' that these remarks were made. These do not indicate that their Lordships laid down any proposition different from the one enunciated above.

16. Reliance is also placed by the Counsel for the appellants on Akbar Ali Khan v. Dr. Ishwar Saran, : AIR1957All622 where, on a difference of opinion between Beg J., and Desai J., Mukerji J., concurred with Desai J. The problem to be solved there was whether an objection petition in answer to an execution petition under S. 47, C. P. C., should be treated as an application under Order 21 Rule 2 C. P. C. The objection petition contained a prayer that the execution proceedings taken, by the decree-holder should be dismissed by recording full satisfaction of the entire decree. The controversy there was whether the two conditions of Order 21 Rule 2 were fulfilled.

Beg J., thought that, to the extent to which information was given regarding the adjustment of the decree, the first part of that rule was complied with and that as regards the second requirement the only thing that was lacking was that the words 'by issue of notice' were not expressly used therein. The absence of these words in the opinion of the learned Judge would not constitute a serious lacuna since notice of this objection petition was served on the decree-holder.

17. Desai J., differed from Beg J., on the question as to the necessity for applying to the Court to issue notice. The learned Judge remarked that the judgment-debtor not only omitted to refer to Order 21 Rule 2(2) C. P. C., but also expressly filed the petition under Section. 47 C. P. C., and that no notice was issued to the respondent asking him to show cause why the payment should not be certified. He distinguished all the cases which laid down the principle that a counter-petition informing the Court of the adjustment was governed by Order 21 Rule 2 C. P. C., on the ground that they contained a prayer for certification. According to the learned Judge, if it contained a prayer for certification, the Court would go into the question of payment and decide whether it should be certified or not but if it did not contain a prayer, the Court was not required to treat it as an application for certification. Mukherji, J., concurred with DesaiJ.

18. We express our respectful dissent from the opinion of Desai J., and Mukherji J. We feel that there is no warrant for the conclusion that a prayer for recording adjustment is an essential ingredient of Order 21 Rule 2(2) C. P. C. What is contemplated by this provision of law is that the judgment-debtor should notify to the Court about the adjustment within 90 days and that the decree-holder should be served with notice of it, so that he could file his objections to it.

19. It is not contended by the Counsel for the appellants that the failure to ask the Court for the issue of notice to the decree-holder has vitiated the application and rightly in our opinion. The judgment-creditor is already before Court. When a copy of the objections is served on the decree-holder, there is no longer any need to apply to the Court for the issue of a notice to the decree-holder. To insist upon an application by the judgment-debtor for the issue of a notice to the decree-holder would he to pay undue regard to the form rather than to the substance. In construing these provisions, we should take into account the purpose and the object of the legislation. In our judgment, a literal interpretation placed on these provisions of law would deprive the judgment-debtor of the right given to him by that rule. We are in agreement with the opinion of Beg J,, as it accords more with the spirit of the law.

20. Mulla in his commentary on the Civil Procedure Code sums up the position on this subject at page 757, 12th edition, thus:

'The law allows the judgment-debtor 90 days to apply to have the payment or adjustment certified (Limitation Act, Schedule I, Article 174). If he does not make the application and the decree-holder applies for execution wilhin that period, he may in answer to the application for execution apply to have the payment 05 adjustment certified, but this must be within 90 days. And it has been held that objections filed by a judgment-debtor to the decree-holder's application for execution may be treated as an application to certify the payment or adjustment, provided the objections are filed within 90 days of the adjustment.'

21. This doctrine is also illustrated by the decision in Ramaswarni v. Muthiralayee, : AIR1954Mad560 . In that decision, rendered by one of us, the question was whether a counter-affidavit of the respondent in an application for passing a decree in terms of an award filed within 30 days of the service of the notice of the petition could be be regarded as an application within the meaning of Section 17 of the Arbitration Act. The answer was in the affirmative. That case furnishes an analogy here.

22. A judgment of the Bench of the Madras High Court in Bangarayya v. Ramabhadriraju, ILR 1948 Mad 123: (AIR 1947 Mad 315) is in consonance with this view. It was held there that the objections of the defendant in substance amounted to an application to set aside an award within the purview of Section 33 of the Arbitration Act.

23. To a like effect is a ruling of a Bench of this Court in Veerasivamy Chetty v. Varadiah Chetty, 1956 Andh WR 394: (AIR 1957 Andh Pra 493). Thus, the current of judicial opinion is pre-ponderatingly in favour of the theory propounded above. It is seen that both on principle and on authority, the counter-petition filed by the judgment-debtor within 90 days, which informs the Court of the satisfaction or adjustment of the decree in answer to an execution petition, could be treated as an application under Order 21 Rule 2(2) C. P. C., as it constitutes substantial compliance with the terms of that rule.

24. We answer the reference accordingly and dismiss the Civil Miscellaneous Second Appeal with costs.


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