Skip to content


Ram Prasad Ram and anr. Vs. Jadunandan Upadhia - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtAllahabad
Decided On
Reported inAIR1934All534
AppellantRam Prasad Ram and anr.
RespondentJadunandan Upadhia
Excerpt:
- - the application having been made after the instalments had fallen due the appropriate article is article 182(7); the application for the recovery of this amount therefore was well within time. gulab kunuiar in which their lordships have clearly pointed out that a fixed term for a mortgage transaction may be as much for the benefit of the mortgagee as for the benefit of the mortgagor and that it is impossible to hold that a mortgagor can, by making default, make the mortgage money become due within the meaning of article 132, limitation act, before the expiry of the fixed period. ' the allahabad view might well be correct. 12. i entirely agree with the hon'ble the chief justice, but having regard to the importance of the points raised in this appeal and having regard to the fact..........is one for the remaining unpaid balance of the decretal amount under the second part of the decree (default clause) it is not governed by article 182 at all, but by article 181 and limitation will run from the date of any two successive defaults, the decree-holder being entitled to a decree for the whole of the balance due less the amount of any individual instalments, which regarded as individual instalments are not already barred by limitation.10. it is quite clear therefore that article 181 in the opinion of all the judges of the full bench would not apply to the application for recovery of instalments of 1928, 1929 and 1930 in the present case. the application having been made after the instalments had fallen due the appropriate article is article 182(7); the application for.....
Judgment:

Sulaiman, C.J.

1. This is an execution appeal by judgment-ebtors. A compromise decree fixing the payments of certain instalments on specified dates was passed. The decree further provided that in case of default of two consecutive instalments the decree-holder would have the right to recover the whole amount by execution. The dates fixed for payment were : 6th June 1925, 13th June 1926, 15th June 1927, 3rd June 1928, 22nd June 1929, 11th June 1930, 31st May 1931 and 18th June 1932.

2. The decree-holder filed the present application on 21st May 1931 in which he mentioned all the instalments but separated the first three from the rest by means of cross-marks. He did not indicate in his application that it was his case that these instalments were barred by time or that they had been paid, but it is a fact that he did not ask for recovery of these instalments. The judgment-debtors took objection that the application was barred by time because the right to apply accrued when the second default was made in 1926. The decree-holder replied by filing an application alleging that he had received payment of the first three instalments. The Courts below have found that the first three instalments were in fact paid and that there was no default. The lower appellate Court has accordingly allowed the appeal for execution for all the instalments except the last one as to which the application was not pressed by the decree-holder.

3. The judgment-debtors have come up in appeal and reiterate their plea of limitation and further urge that it was not open to the Courts below to go into the question of the payments out of Court.

4. It has to be conceded on behalf of the decree-holder that the payments alleged to have been made by the judgment-debtors out of Court were not certified in Court or recorded by the Court prior to the filing of the objection of the judgment-debtors. It was held by all the Judges in the Pull Bench case of Joti Prasad v. Sriohand : AIR1928All629 , that if a statement purporting to certify a payment out of Court is made by the decree-holder after the controversy had arisen it cannot have the force of a certificate. It is impossible to hold that the mere placing of certain cross-marks after the first three instalments amounted to any intimation to the Court that the decree-holder was certifying payment of those instalments. The idea did not seem to have struck the decree, holder till some time after the objection was filed by the judgment-debtors alleging that no payments had bean made and the application for execution itself was barred by time. It must accordingly be held that these payments had never been certified within the meaning of Order 21, Rule 2, Civil P.C. and therefore the execution Court cannot take cognizance of any such alleged payments. The Courts below therefore were not justified in enquiring into this matter. When these alleged payments are to be altogether ignored it must be assumed that no payments were in fact made. It would follow that it must be presumed that the judgment-debtors had made default in the payment of the first three instalments.

5. The next question is whether the present application is barred by time. The application can be split up into two parts. The first relief being for the recovery of the instalments of 1928, 1929 and 1930, and the second for the recovery of the subsequent instalments, one of which was later on not pressed for. As noted above, the application is for execution of a decree of Court which fixes certain instalments. So far as the instalments of 1928, 1929 and 1930 are concerned, dates were specified in the decree on which they had to be paid. It is therefore impossible to take the case out of Article 182(7), Limitation Act. Under that sub-clause an application for execution, where the application is to enforce any payment which the decree or order directs to be made at a certain date, must be made within three years from such date. The clause applies in express terms to the application for execution so far as these three instalments are concerned and it is not possible to take it out of that clause. In these circumstances the residuary Article 181 would not apply at all to these three instalments.

6. It is however contended on behalf of the appellants that inasmuch as the right to apply accrued on the occurrence of the second default in 1926 and the decree-holder became entitled to recover the whole amount, time began to run in respect of the instalments from that date and the whole claim is now barred by time.

7. This question came up for consideration before a Full Bench of this Court in Joti Prasad v. Srichand : AIR1928All629 of which both of us were members. The opinion of the majority of the Bench was that the Words 'at a certain date' in Clause (7) of Article 182 meant a specified date and would not be wide enough to include any date of default not specified. It was accordingly held by the majority that when a default clause of this kind is sought to be enforced the appropirate article would not be Article 182(7) but the residuary Article 181. And air the three Judges took the view that so far as the instalments which had already fallen due were concerned the appropriate article was Article 182(7). It was only as regards the remaining unpaid balance in respect of the instalments which had not yet fallen due that two of the Judges thought that Article 181 applied. The view of the majority accordingly was that it was not necessary to enforce the default clause in order to recover instalments which had already fallen due and that an application for recovery of such instalments would be governed by Article 182(7) and would be in time if filed within three years of the dates of the various instalments. An application for recovery of instalments more than three years old would be beyond time unless there was an acknowledgment or payment sufficient to save limitation. But as regards the future instalments not yet fallen due and which were not yet recoverable unless the default clause was enforced the appropriate article was Article 181 and time would begin to run from the date when the right to apply accrued.

8. The further question as to the date from which the time under Article 181 would begin to run, namely, whether from the date when the right to apply accrued on the first occasion or from the date when it accrued on the last occasion did not directly arise in the case because all the instalments had fallen due before the application for execution was made. Mukerji, J., did not deal with this aspect of the case because he was of opinion that Article 181 did not apply at all. On p. 980 (of 26 A.L.J.) I remarked:

In such circumstances the application for the recovery of the amounts of instalments which fell due more than three years prior to the application would, unless it was saved by Sections 19 or 20, be barred by time; but the application would still be within time as regards those instalments which fell duo within three years, in spite of a default clause. As the dates fixed for all the instalments had expired before the application for execution was made, there; was no necessity for the decree-holder to enforce the default clause. His application is substantially one for recovery of the total amount of the instalments fallen due together with interest.

9. I further pointed out that the case would be different if the claim were to enforce the default clause before the dates fixed for the subsequent instalments had arrived. In my separate-judgment I did not deal with the question whether time would begin to run from the date when the right to apply first accrued or from any subsequent accrual of a similar right. Boys, J., seems to have held at p. 989 that Article 181 would apply to an application for execution in respect of the future instalments, but further added that the right to apply would accrue on the first date of default and again on the occurrence of each default in respect of that and the previous default. Thus, in the separate judgments that were delivered only one Judge had expressed the opinion that there would be successive accruals of the right to apply the other two did not express any opinion at all. In the opinion of the Court which was expressed at the end of the judgment and which was the opinion of the only Judge who had expressed it, it was accordingly mentioned that if the application is one for the remaining unpaid balance of the decretal amount under the second part of the decree (default clause) it is not governed by Article 182 at all, but by Article 181 and limitation will run from the date of any two successive defaults, the decree-holder being entitled to a decree for the whole of the balance due less the amount of any individual instalments, which regarded as individual instalments are not already barred by limitation.

10. It is quite clear therefore that Article 181 in the opinion of all the Judges of the Full Bench would not apply to the application for recovery of instalments of 1928, 1929 and 1930 in the present case. The application having been made after the instalments had fallen due the appropriate article is Article 182(7); the application for the recovery of this amount therefore was well within time. As regards the future instalments the decree-holder did not press his application for the instalments of 1932, but the lower appellate Court has ordered execution in respect of the instalments for 1931 which would have fallen due on 31st of May of that year. The application however was made 10 days earlier and was therefore premature unless the default clause can be enforced. The condition in the compromise decree already referred to laid down that the decree-holder would have the right to recover the whole amount on the occurrence of two successive defaults in the payment of instalments. There had been a considerable difference of opinion as to whether it is open to a creditor to waive his right to recover the whole amount where an option is given to him in case of default. So far as the right to sue for recovery of mortgage money is concerned it is now governed by the pronouncement of their Lordships of the Privy Council in Lasa Din v. Gulab Kunuiar in which their Lordships have clearly pointed out that a fixed term for a mortgage transaction may be as much for the benefit of the mortgagee as for the benefit of the mortgagor and that it is impossible to hold that a mortgagor can, by making default, make the mortgage money become due within the meaning of Article 132, Limitation Act, before the expiry of the fixed period. Their Lordships held that a mortgagor could not take advantage of his own default and claim a right to redeem before the expiry of the period and that therefore the mere fact that there was an option given to the mortgagee for his own benefit to sue for the whole amount would not make the money become due so as to make the time run against the mortgagee. But in the latter portion of the judgment their Lordships also pointed out that:

If in the Indian cases the question ware 'when did the mortgagee's cause of action arise?' i.e., when did he first become entitled to sue for the relief claimed by his suit their Lordships think there might be much to be said in support of the Allahabad decision.

11. The Allahabad view, as expressed in two previous Pull Bench cases of Gayadin v. Jhumman Lal A.I.R. 1915 All. 189 and Shib Dayal v. Meherban A.I.R. 1923 All. 1 was that time began to run from the date when the mortgagee first become entitled to exercise option no matter whether he chose to exercise it or not. This view has been definitely overruled by their Lordships of the Privy Council, but their Lordships seem inclined to the view that if in the Indian cases the questions were 'when did the mortgagee's cause of action arise?' the Allahabad view might well be correct. It seems to me that the expression 'right to apply accrues' is more emphatic than the expression 'cause of action arises.' If the date when the cause of action arises is to be considered to be the first date when one becomes entitled to sue for the relief claimed by him then the date when he becomes entitled to apply is certainly the date when the right to apply by way enforcing the default clause accrued to the mortgagee when on the first occasion there was a default in the payment of two successive instalments, namely, in the year 1926. It is true that he did not then apply for execution claiming the whole amount, but certainly had the right to apply and so it cannot [be said that the right to apply did not accrue. The result would be that so far as the remedy for the enforcement of the default clause in the compromise decree is concerned it became time-barred after the expiry of three years from 13th June 1926. It is no longer open to the decree-holder to claim the recovery of future instalments merely because in some future years there has again been a default in the payment of two successive instalments. This however does not mean that his remedy to recover the instalments as and when they fall due is also equally barred. I have already pointed out that the application for execution of the decree for recovery of these instalments for which dates have been specified in the decree is governed by Article 182(7). As remarked by me on p. 980 (of 26 A.L.J.) in Joti Prasad's case : AIR1928All629 the application is still within time as regards these installments which had fallen due within three years ' in spite of the default clause. ' I would accordingly hold that the application for the recovery of the instalments for 1928, 1929 and 1930 is within time, whereas the application for the recovery of the instalment for 1931 was premature, I would accordingly allow the appeal in part.

Mukerji, J.

12. I entirely agree with the Hon'ble the Chief Justice, but having regard to the importance of the points raised in this appeal and having regard to the fact that points, similar to the one before us, arise very often in execution of instalment decrees, I would like to add a few words. The facts of the case are stated in the judgment of the learned Chief Justice and briefly they may be reiterated as follows : An instalment decree was passed on 12th May 1924 in favour of the respondent. It can after mentioning the several dates fixed for payment for instalments, as follows:

In the case of default in the payment of two successive instalments, the decree-holder would be entitled (decreedar ho ikhtiar hoga) to realize the entire balance of his decretal amount, irrespective of the fact whether or not instalments have fallen due, by execution of the decree.

13. The decree-holder applied for execution in respect of the last five instalments. He did not say in respect of the first three instalments whether they had been paid or not. 'When the application for execution was made the judgment-debtors objected that they had never made any payment and the application was time-barred, inasmuch as the right to apply for execution accrued to the decree-holders on 13th June 1926. On this the decree-holder came forward with an application stating that he had received the first three instalments. The Courts below have found as a fact that the first three instalments were paid by the judgment-debtors. Having regard however to the decision of the Full Bench case in Joti Prasad v. Sriahand : AIR1928All629 it was not open to the decree-holder to certify payment of the first three instalments after the judgment-debtors had taken an objection to the execution of the decree on the ground that he had made no payment. It follows that the Courts below were not entitled to go into the question as to whether the first three instalments had been paid or not. The judgments of the Courts below therefore so far as they found that the payments had been made, must be regarded as non-existent. We must however further regard, for the purposes of this case, that the first three instalments were never paid. In the circumstances, the question arises whether the present application is time-barred. According to the terms of the decree the decree-holder had two distinct rights. The first right was to receive instalments as and when they fell due. The second right was to enforce the payment of all the instalments that might remain unpaid, in the case of two successive instalments remaining unpaid. If it be a fact that the second right is time-barred it would not follow that the first right would also be time-barred.

14. As regards the second right, namely, to realise the entire amount of the decree irrespective of the fact whether the instalments have fallen due or not, the majority of the Full Bench in the case already quoted, namely, Joti Prasad v. Srichand : AIR1928All629 held that Article 181, Schedule 1, Limitation Act, would apply. Then the question is when did the right to apply accrue to the decree-holder within the meaning of column 3 of Article 181. That right to apply would accrue on the first occasion. A right to apply may accrue on several occasions but for the purposes of limitation the first occasion when the right to apply accrues must be taken as the crucial date. This was indicated by their Lordships of the Privy Council in the case of Lasa Din v. Gulab Kunwar . The right to apply in this case therefore accrued to the decree-holder on 13th June 1926. More than three years having elapsed from that date it is no longer open to the decree-holder to apply for recovery of such instalments as had not fallen due on 21st May 1931, when he made his application for exeeution. It follows that he cannot recover the instalment due on 31st May 1931, which had not fallen due on the date of the application for execution. For similar reasons he could not apply for the recovery of the instalment of 1932.

15. I have already remarked that the fact that the decree-holder's second right is barred, does not force us to hold, as a necessary consequence, that the first right is also barred. As pointed out by all the Judges in the Full Bench case of Joti Prasad v. Sriohand : AIR1928All629 the instalments, as and when they fall due, are recoverable under Article 182(7), Schedule 1, Lim. Act. In that view the instalments of 1928, 1929 and 1930 are recoverable. 1 agree therefore that the appeal should be al-slowed in part by declaring that the instalment which fell due on 31st May 1931 is not recoverable under the present application for execution.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //