1. This matter has been referred to a Division Bench by my learned brother Harnam Singh J., because of the conflict of opinion between the Bombay High Court in -- 'Bhagwan Shankar v. Raja-ram Bapu', 1951 Bom. 125 (AIR V 38) (FB) (A), and the Rajasthan Court in -- 'Shah Premchand v. Shah Danmal', 1954 Raj. 4 (AIR v 41) (B). The appeal in this Court was brought by the decree holder against an order of the Senior Subordinate Judge, Ludhiana, dated 14-5-1952 dismissing the application for execution.
2. On 17-2-1948 firm Radhe Sham-Roshan Lal obtained a decree for Rs. 14,000 against firm Kundan Lal-Mohan Lal from the Court of a Subordinate Judge at Indore. The Maharaja of Indore signed a covenant with the Dominion of India on 18-4-1948 and on 28-5-1948 the State of Madhya Bharat was created by the merger of several States including Indore: Appendix XXXVII at page 252 in the White Paper on Indian States issued by the Ministry of States.
There is no term in this covenant in regard to pending proceedings. I should have mentioned that although firm Kundan Lal-Mohan Lal was served but they never submitted to the jurisdiction of the Indore Court. On 21-9-1950 the decree-holder obtained a transfer certificate for execution to the Ludhiana Court and on 10-1-1951 he made an application for execution. The execution Court held that although the decree could be transferred it was a decree of a foreign Court and could not therefore be executed.
3. According to Dicey on Conflict of Laws 'foreign Judgment' means a judgment, decree, or order of the nature of a judgment which is pronounced or given by a foreign Court (page 345),and in an action in personam the Courts of a foreign country have jurisdiction where the partyobjecting to the jurisdiction of the Courts of such country has precluded himself from objecting thereto * * * * (b) by voluntarily appearing as defendant in such action (page 352). In the Indian Civil Procedure Code, Section 2(6), also 'foreign judgment' means the judgment of a foreign Court which is defined in Section 2(5) to mean:
'2(5) 'foreign Court' means a Court situate outside India and not established or continued by the authority of the Central Government.' Therefore when the decree was passed it was the Judgment of a foreign Court as defined in Private International Law or in the Indian Civil Procedure Code and this was not controverted by the learned. Advocate for the appellant. The question which has to be seen is whether a judgment which had not an Indian nationality at the time when it was passed changes its nationality by anything which has subsequently happened or there is any provision for its naturalisation as an Indian judgment.
In a case where an order was passed in Lahore before the partition of India and was sought to be executed after the partition in Delhi, it was held that it continued to be an Indian judgment -- 'Kishori Lal v. Shanti Devi', 1953 S. C. 441 (AIR V 40) (C). A judgment therefore continues its old nationality until by statute or otherwise there is a change.
4. It was submitted by the appellant that under Section 43, Civil P. C., the decree of the erstwhile Indore Court could be executed in Ludhiana. It may be necessary to give the history of Section 43 from 1947 till today. Before the Adaptation Order of 1948 the words used were-
'Any decree passed by a civil Court established in any part of British India to which the provisions relating to execution do not extend, or by any Court established or continued by the authority of the Central Government or the Crown Representative in the territories of any foreign Prince or State may, if it cannot be executed within the jurisdiction of the Court by which it was passed, be executed in manner herein provided within the jurisdiction of any Court in British India.'
After the Adaptation Order of 1948 these words were as follows: --
'Any decree passed by a Civil Court established in any area within the Province of India towhich the provisions relating to execution of notextend, or by any Court established or continuedby the authority of the Central Government orthe Crown Representative in any Indian State,may, if it cannot be executed within the jurisdiction of the Court by which it was passed, be executed in manner herein provided within the jurisdiction of any Court in the Provinces.'
After the Constitution there was Adaptation Orderand then the words used were-
'Any decree passed by a civil Court established in any area within the States to which the provisions relating to execution do not extend, or by any Court established or continued by the authority of the Central Government outside India, may, if it cannot be executed within the jurisdiction of the Court by which it was passed, be executed in manner herein provided within the jurisdiction of any Court in the States.'
There was another Adaptation Order and then Section 43 came to read as under: --
'43. Execution of decrees passed by civil Courts in part B States, in places to which this part does not extend or in foreign territory-
Any decree passed,
(a) by a civil Court in a Part B State, or
(b) by a civil Court in any area within a Part A State or Part C State to which the provisions relating to execution do not extend, or
(c) by a Court established or continued by the authority of the Central Government outside India .. ..'
5. This amendment thus made the decrees passed by Courts in the newly created B States to be executable in India even though the Code had not been extended to these States. This section was again amended by Section 8 of Act II of 1951 and now the section reads as under:--
'Any decree passed by any civil Court established in any part of India to which the provisions of this Code do not extend, or by any Court established or continued by the authority of the Central Government outside India, may, it it cannot be executed within the jurisdiction of the Court by which it was passed, be executed in the manner herein provided within the jurisdiction of any Court in the territories to which this Code extends.'
It is submitted that it was the section as amended by the second Adaptation Order after the Constitution which governed the case because it was that section which was applicable on 10-1-1951 when the execution started, but pending the execution on 19-2-1951 the present section came into force in India.
6. As I understand Section 43 as it stood before the Act of 1951, it made the decrees of Courts of B States executable. But part B States themselves were the creation of the Constitution and the reference in my opinion was to decrees passed after the Constitution. And if the section is merely procedural and therefore retrospective then from 19-2-1951 a new section was substituted and from that date the new Section 43 becomes applicable which does not have any reference to Part B States, and therefore the only decrees executable would be those for areas mentioned in Section 2 of the Act (II of 1951).
7. Similarly Section 44 has undergone several changes and, at the time when the application for execution was made it read as follows:--
'44. Execution of decrees passed by Revenue Courts in part B states-
The Government of a Part A State or Part C State may, by notification in the Official Gazette declare that the decrees of any Revenue Courts in any Part B State or any class of such decrees may be executed in the Part A State or Part C State as the case may be as if they had been passed by Courts of that State.' And now under Act II of 1951 it reads as under: --
'44. Execution Of decrees passed by revenue Courts in places to which this Code does not extend.
The State Government may, by notification in the Official Gazette, declare that the decrees of any revenue Court in any part of India to which the provisions of this Code do not extend, or any class of such decrees, may be executed in the State as if they had been passed by Courts in that State.'
8. The history of Section 43 shows that originally, i.e., up to 1947 the decrees of Court in three portions of British India to which the Code was not applicable wore executable in the rest of British India. the Adaptation Order of 1948 only made verbal changes as they wanted to substitute BritishIndia by Provinces of India which by the Constitution became States. But even after the Constitution the Civil Procedure Code did not become applicable to the newly created States which came into existence as a result of their merging into groups. They had become India and were no longer princely States with a semi-independent Status.
Decrees of these Courts of these States as created by the Constitution of 1950 were decrees 'passed by Civil Courts established in any part of India' and not British India as it was in 1947 and therefore they were executable in exactly the same manner as decrees mentioned in the Code in 1947. And that was the reason for this Adaptation. And when the Act of 1951 came into force the Code became applicable throughout India and the need for Section 43 was reduced to the decrees of areas mentioned in Section 2 of the Act of 1951.
9. The history of Section 44 of the Code shows that it has always been complementary with Section 43. Before 1937 the words used were 'in the territories of any native Prince or State' which would have included Indore. In 1937 these words were replaced by 'in any Indian State'. And Section 44A was introduced to reciprocate the policy contained in Foreign Judgments (Reciprocal Enforcement) Act 1933.
But for the decrees passed toy Courts in Indian States section was applicable. The language used in the section after the Adaptation Order of 1948 produced no real change. The first Adaptation of 1950 introduced the words Part B States and they still required a notification under Section 44 to make the decrees of Courts in Part B States executable.
But when Section 43 was amended lay the second Adaptation Order of 1950 so as to give executability to decrees of such Courts, Section 44 was further amended to restrict the necessity of a notification to decrees of Revenue Courts of Part B States. And the position is practically the same after the Act of 1951. Decrees of all Courts in India to which the Code applies are executable in any part of India except those covered by Section 2 of the Act of 1951 and therefore Section 44 is restricted to decrees of Revenue Courts.
10. Now the defendants never submitted to the jurisdiction of the Court at Indore and therefore the Court had no jurisdiction over them. As is said in Cheshire on Private International Law at page 779: --
'A foreign judgment is actionable only because it imposes an obligation upon the defendant, it follows that any fact which negatives the existence of that obligation is a bar to the action. One of the negativing facts must necessarily be that the defendant owes no duty to obey the command of the tribunal which has purported to create the obligation. There must be a correlation between the legal obligation of the defendant and the right of the tribunal to issue its command.'
11. As the Indore Court had no jurisdiction under Private International Law over the defendant firm, it owed no duty to obey the order of that Court. Nor could the Ludhiana Court therefore act as its enforcing agent.
12. The form of the transfer certificate to be sent under Order 21, Rule 6, Cavil P. C.. is given at page 1333 of Mulla's Civil Procedure Code. Thus the Executing Court in Ludhiana had to execute the decree of Indore of 1948. This decree remains the decree of that Court which was not a Court of a Part B State as Part B States did not exist then. It continued tobe a decree of a Court of Indore State which was a foreign Court.
13. The next question which arises for decision is whether Section 43 is merely procedural or also creates rights. The question whether the decree-holder can enforce his rights under the decree by execution as also by suit or only by a suit under Section 13 of the Code is not a question of procedure but is a question of substantive law as it Is a question of right of a decree-holder and if he has the right to enforce his rights under the decree of the Court at Indore by means of execution, the applicability of Order 21 is a question of procedure in which no one can have a vested right. See Maxwell on Interpretation, page 201 (8th Edn.) and In re Hales Patent, (1920) 2 Ch. 377 (D), where this distinction between rights and procedure, is shown.
Therefore what decrees can be enforced by execution and which by suit is not a procedural matter but one relating to rights of decree-holders and cannot, in my view, be affected by change in the law unless it is expressly retrospective.
14. If the contention that Section 43, as it was before the Act of 1951, is retrospective, were to be accepted, on a foreign judgment the status of a Judgment of an Indian Court would be conferred. Therefore an erstwhile British Indian subject who did not submit to the jurisdiction of a foreign Court would become bound by that decree and no defence on the merits of the case would be open to him and thus his vested rights would be affected by a subsequent change in the law. This would be sufficient to meet the argument in favour of re-prospectively.
15. It is to avoid hardships to decree-holders who had obtained decrees from Indian States that Section 44 existed, the object of which was to give executability to decrees of Indian States so as to put them on a par with decrees of Indian Courts and I have no doubt that the object was to apply this section to those cases where the Standards of the judiciary approximated to Indian Standards or at least were not subject to the defects mentioned in Section 13 of the Code, It was, in my view, for that reason that two sections in the Code were enacted one dealing with Indian States i.e. Section 44 and the other with foreign countries i.e., Section 44A.
16. Several cases have been relied upon by the appellant. Reliance is placed in the first instance on Chunnilal Kasturchand v. Dundappa Damappa, 1951 Bom 190 (AIR V 38) (E), where it was held that a decree passed by a Belgaum Court could be executed in Jamkhandi which at the time the decree was passed was an Indian 'native' state but which became merged later on in the Province of Bombay and it was further held that the decree of a competent Court could be executed in Jamkhandi because it had become an Indian Court.
This judgment was approved of by a Pull Benchof that Court in 1951 Bom 125 (AIR V 38) (A),where a decree passed by the Sholapur Courtagainst a resident of Akalkot was held to be executable in the latter Court because Akalkot had merged with Bombay and qua Akalkot the decree of theSholapur Court was no longer a foreign judgment.But how far 1953 SC 441 (AIR V 40) (C) wouldaffect the correctness of this judgment will haveto be considered. In this Court in Dalel Singh v.Dhan Devi, Letters Patent Appeal No. 24 of 1952(F) a decree passed by a Court in Nabha was heldto be executable in the Punjab because of Section 43of the Code or Civil Procedure as it existed before Act II of 1951, on the ground that Section 43as it existed after the second Adaptation Order isretrospective
But this section itself has been repealed by Act II of 1951 & has been substituted by the present section which I have already given. If Section 43 is to be retrospective then as at the time the judgment-debtors appeared in the Ludhiana Court the present section was in force the execution will be governed by that law, which provides for the execution of decrees of Courts in areas to which Civil Procedure Code does not apply. Therefore the section as it stands today would not be applicable to the decrees passed by Courts in Part B States and the very notion of B Class States is a creation of the Constitution which it has been held by their Lordships of the Supreme Court to be prospective.
If the view taken in the Letters Patent Appeal is made applicable then we would be giving re-trospectivity to the Constitution which is contrary to the view taken by the Supreme Court amongst others in Qasim Razvi v. State of Hyderabad, 1953 SC 156 (AIR V 40) (G), and Habeeb Mohamed v. State of Hyderabad, 1953 SC 287 (AIR V 40) (H).
17. Besides a judgment which was a foreign judgment would not, except under any express provision to that effect be turned into an Indian judgment which is the rule laid down by their Lordships in 1953 SC 441 (AIR V 40) (C). The Calcutta High Court in Firm Shah Kantilal v. Dominion of India, 1954 Cal 67 (AIR V 41) (I) has discussed all these questions at a great length. Besides that there are the judgments of the Rajasthan and Mysore Courts in 1954 Raj 4 (AIR V 41) (B) and Subbaraya Setty & Sons v. Palani Chetty & Sons, 1952 Mys 69 (AIR V 39) (J).
18. There is also another question which arises and that is which law would be applicable to executions. The appellant submits that it would be the law at the time when the application was made which is contrary to the judgment of the Federal Court in Lachmeshwar Prasad v. Keshwar Lal, 1941 FC 5 (AIR V 28) (K), where reference is made to other judgments -- Quilter v. Mapleson, (1882) 9 QBD 672 (L) and K. C. Mukerjee v. Mt. Ram Ratan Kuer, 1936 PC 49 (AIR V 23) M).
19. I may here deal with two arguments which would arise as a result of the coming into force of the Constitution of India. One arises from Article 261 which deals with Public acts records & proceedings. The Constitution is prospective & therefore it must be read in that light. This article reads as follows:
'(1) Full faith and credit shall be given throughout the territory of India to Public acts, records and judicial proceedings of the Union and of every State.
(2) The manner in which and the conditions under which the acts, records and proceedings referred to in Clause (1) shall be proved and the effect thereof determined shall be as provided by law made by Parliament.
(3) Final judgments or orders delivered or passed by civil courts in any part of the territory of India shall be capable of execution anywhere within that territory according to law.'
20. Now all these clauses deal with something which is to be done in future & the use of the words 'Union & every State' can be referable to judicial acts performed after the Union or States came into existence. And even Clause 3 must be applicable to parts of territories of India and Part B States have become parts of India as a result of the Constitution and not because of theInstruments of Accession or the Covenants as given in the white paper or Indian States.
21. The second argument is based on Article 375which may be quoted:
'All courts of civil, criminal and revenue jurisdiction, all authorities and all officers, judicial, executive and ministerial, throughout the territory of India, shall continue to exercise their respective functions subject to the provisions of this Constitution.'
22. This article continues the Jurisdiction of all courts wherever they may in the territories of India and the argument of prospectively will be equally applicable to this article. Besides in Section 2(5) the reference is to courts outside India e.g., the Court of the Political Agent at Sikkim & Section 43 of the Code also refers to Courts outside India which are established or continued by the Central Government.
This article therefore which deals with Courts in India would not affect the argument as to the foreign nationality of the decree sought to be executed.
23. As the questions are of great importance and as a Division Bench of this Court has taken a view to the contrary, I must refer this case to a Pull Bench, and I direct that papers be placed before the Hon'ble the Chief Justice for the constitution of a Bench to decide this matter.
Bishan Narain, J.
24. I agree that this case should be referred to a larger Bench.