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Lilawati Namdhari Vs. Thakar Bhagwan Dass Janjhua and ors. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtDelhi High Court
Decided On
Case NumberFirst Appeal No. 78 of 1968
Judge
Reported inILR1972Delhi107B
ActsCode of Civil Procedure (CPC), 1908 - Order 47, Rule 1(1); Displaced Persons (Debt Adjustment) Act, 1951 - Sections 15
AppellantLilawati Namdhari
RespondentThakar Bhagwan Dass Janjhua and ors.
Advocates: B.G. Singh and; A.C. Sehgal, Advs
Cases Referred and Prakash Textile Mills v. Mani Lal
Excerpt:
.....under section 10 along with granting stay of proceedings against another displaced debtor, namely, atma singh. there was clearly an error apparent on the face of the record within the meaning of the expression used in rule 1 of order xlvii of the code and so it constituted a good and sufficient ground for review and the order of the learned subordinate judge is, in our opinion within his jurisdiction and he has rightly exercised his powers of review and corrected the error. in this way, when an application has been moved by a displaced debtor, the tribunal seized of the matter settles the lists of creditors as well as their claims, the properties and assets of the debtor and his paying capacity and scales down the debts, if necessary according to law and finally passes decrees under..........payment of rs. 1,10,000.00 by the debtor to the aforesaid two creditors.(3) it appears that shri atma singh narndhari, m. p., husband of smt. lilawati, also owed a debt and on his death, lilawati debtor above-mentioned, along with her co-widow and an adopted son, in their capacity as legal representatives of atma singh deceased, filed an application under section 5 of the act in 1956. one of the debts mentioned in the schedule attached to the application was a sum of rs. 6,500.00 owed by atma singh deceased to harbans singh., one of the creditors, but this debt is different from the one which had been adjudicated upon by the tribunal in the earlier proceedings and bhagwan dass, the other creditor, has not been shown as a creditor in the proceedings instituted under section 5. this.....
Judgment:

B.C. Misra, J.

(1) This order will dispose of two appeals (F.B.A.0s. Nos. 78 of 1968 and 158 of 1968). The first of the appeals has been filed by Smt. Lilawati (who is hereinafter referred to as the debtor) and the second appeal has been filed by Thakar Bhagwan Dass and Thakar Harbans Singh (who are hereinafter referred to as the creditors).

(2) The material facts of the case briefly stated are that the aforesaid creditors had a claim for a debt against Smt. Lilawati debtor and they in 1953 filed an application under section 10 of the Displaced Persons (Debts Adjustment) Act 70 of 1951 (hereinafter referred to as the Act). The claim laid was for a larger amount, but on the admission of the debtor, the Tribunal passed a decree dated 30th December, 1953 for payment of Rs. 1,10,000.00 by the debtor to the aforesaid two creditors.

(3) It appears that Shri Atma Singh Narndhari, M. P., husband of Smt. Lilawati, also owed a debt and on his death, Lilawati debtor above-mentioned, along with her co-widow and an adopted son, in their capacity as legal representatives of Atma Singh deceased, filed an application under section 5 of the Act in 1956. One of the debts mentioned in the schedule attached to the application was a sum of Rs. 6,500.00 owed by Atma Singh deceased to Harbans Singh., one of the creditors, but this debt is different from the one which had been adjudicated upon by the Tribunal in the earlier proceedings and Bhagwan Dass, the other creditor, has not been shown as a creditor in the proceedings instituted under section 5. This petition has had a chequered career. It was firstly dismissed by the Tribunal on the ground that the legal representatives of a debtor could not move the application which was reversed by the High Court (P. D. Sharma, J.) by judgment dated 18th September, 1963 and the case was remanded to the Tribunal for decision according to law. There were some disputes about the other creditors being included in this petition which was disposed of by Mehar Singh, J. by order dated 3rd January, 1964. One of the findings recorded in this judgment is that the decree of the Tribunal passed on 30th December, 1953 for Rs. 1,10,000.00 in favor of Bhagwan Dass and Harbans Singh (the creditors mentioned herein) had become final and their debts could not be included in the petition filed later under section 5 of the Act. The High Court also found that the legal representatives f Atma Singh had the paying capacity to meet the debts and so the Tribunal had rightly declined to scale them down. It is common case of the parties that the proceedings in pursuance of the application of the legal representatives of Atma Singh filed under section 5 of the Act are still pending before the Tribunal which happens to be the civil Court which has passed the order challenged in these appeals.

(4) The creditors Bhagwan Dass and Harbans Singh who had obtained the aforementioned decree from the Tribunal against Lilawati debtor for Rs. 1,10,000.00, applied to the Tribunal for execution of the decree which is being executed. In the proceedings relating to section 5 application, the Tribunal consolidated all the proceedings and by order dated 28th November, 1967, stayed them all, including the execution of the aforesaid decree. Thereafter, the creditors mentioned herein moved an application for review of the order which was partly allowed by the Court below by order dated 16th March, 1968. By this order, the learned Subordinate Judge vacated the stay so far as the execution of the decree dated 30th December, 1953 in favor of the creditors mentioned above was concerned, but he maintained the decree for stay in respect of the remaining proceedings. This order has been impugned in these appeals, one filed by the debtor and the other by the creditors.

(5) The learned counsel for the debtor appellant has raised two contentions, one is that the order granting review is had in law as it contravened the provisions of Rule I of Order XLVII of the Code of Civil Procedure and the second contention is that the order vacating the stay is not sustainable on the merits and on the construction of sections 15 and 28 of the Act, the execution proceedings ought to have been stayed by the Tribunal.

(6) We have heard the learned counsel for the parties and have perused the record of the case and we are of the opinion that there is no substance in either of the contentions of the debtor- appellant.

(7) T previous order of the Court below dated 28th November, 1967 granting stay of execution proceedings suffered from an error apparent on the face of the record. The previous decree of the Tribunal had been passed against Lilawati in her personal capacity and not as legal representative of Atma Singh and the decree had been passed in favor of the two creditors mentioned herein in respect of another debt. The subsequent proceedings initiated by an application under section 5 had been instituted in respect of the debts and liabilities of Atma Singh by his legal representatives in which Smt. Lilawati debtor is not personally concerned and in which Bhagwan Dass, one of the creditors, is not a party, nor do the said proceedings deal with the debts owed by Smt. Lilawati in her personal capacity. Mehar Singh, J. by his order mentioned above had finally held that the previous decree of the Tribunal in favor of the creditors against Lilawati was final and could not be reopened in the subsequent proceedings under section 5. The learned Subordinate Judge, in passing the previous order, had noticed these facts but had failed to give effect to the legal consequences of the two proceedings being related to separate debtors and separate debts and so it was illegal to stay the proceedings relating to a displaced debtor in respect of another debt which had been decreed by the Tribunal on a petition under section 10 along with granting stay of proceedings against another displaced debtor, namely, Atma Singh. This was obviously an error apparent on the face of the record within the meaning of the expression used in Rule 1 of Order XLVII of the Code of Civil Procedure. Construing the aforesaid expression, the Supreme Court in M/s Thungabhadra Industrial Limited v. The Government of Andhra Pradesh, : [1964]5SCR174 , observed that 'there was area distinction between a mere erroneous decision and a decision which could be characterised as vitiated by an error apparent' and where without any elaborate argument one could point to the error and say that there was a substantial point of law staring in the face, there could reasonably be no two opinions entertained about it and a clear case of an error apparent on the face of the record would be made out. The Court further held that in the circumstances of that case, the High Court was in error in not reviewing its order which suffered from an error apparent on the face of the record. The learned counsel for the debtor- appellant has relied upon a decision of the Judicial Committee in Chhajju Ram v. Neki and others, I. L. R. 3 Lahore 127 C) to the effect that a Court had no power to review its order on the ground that the decision was wrong on the merits and that the phrase 'sufficient cause' was at least analogous to those specified immediately previously in the statute. There is absolutely no doubt with regard to the correctness of the dictum of the Privy Council, but it has no application to the facts of this case. There was clearly an error apparent on the face of the record within the meaning of the expression used in Rule 1 of Order XLVII of the Code and so it constituted a good and sufficient ground for review and the order of the learned Subordinate Judge is, in our opinion within his jurisdiction and he has rightly exercised his powers of review and corrected the error.

(8) In support of his second contention, the learned counsel for the appellant has submitted that the language of section 15 of the Act is very wide and it covers execution proceedings before the Tribunal for execution of the decree passed by it in exercise of powers under section 28 of the Act and that these proceedings should also have been stayed while the petition of the debtor was pending under section 5 of the Act. Prima facie, we are not impressed by the submission. The Tribunal is defined in clause (12) of section 2 of the Act as meaning any Civil Court specified under section 4 of the Act as having authority to exercise jurisdiction under the Act and section 4 prescribes that the A State Government may, by notification in the Official Gazette, specify any Civil Court or class of Civil Courts as Tribunals under the Act. Applying the said definition, section 28 of the Act would be Interpreted to read that it shall be competent for the Tribunal (that is to say the Civil Court which has been specified as Tribunal under section 4 of the Act for purpose of the Act) to execute any decree or order passed by it as a Tribunal in the same manner as it could have been done had it been a decree or order passed by the Tribunal as a Civil Court. The scheme of the Act is that within the period prescribed, a displaced person is permitted to move an application under section 5 of the Act and a displaced creditor is also permitted to move applications under sections 10 and 13 of the Act, and where a creditor moves an application under section 10, the displaced debtor is further permitted by section 11(2) of the Act to move his own independent application under section 5 of the Act. In this way, when an application has been moved by a displaced debtor, the Tribunal seized of the matter settles the lists of creditors as well as their claims, the properties and assets of the debtor and his paying capacity and scales down the debts, if necessary according to law and finally passes decrees under section 27 of the Act containing a complete schedule of the creditors and of the assets and liabilities of the displaced debtor which of course are executed in accordance with the provisions of section 28 of the Act. Section 15 of the Act provides that before a debtor has made an application under section 5 or under section 11(2) of the Act, all proceedings pending on the date of the application in any Civil Court in respect of any debt, to which the displaced person is subject, shall be stayed and the records of all such proceedings shall be transferred to the Tribunal and consolidated. There are other provisions relating to attachments, injunctions, appointment of receivers, issue of fresh process and institution of a fresh suit and against any alienation of any property without the authority of the Tribunal. But obviously, the provisions of section 15 came into play after an application under section 5 has been filed and before the proceedings have been transferred to the Tribunal and they do not have any application to the proceedings which have been decided by the Tribunal. Consequently, the execution of the decrees which had been passed by the Tribunal in the proceedings under the Act, whether initiated under section 5 or under section 10 and which are being executed by the Tribunal or for that matter the Civil Court under section 28 of the Act, cannot be stayed under section 15 of the Act. On the construction contended by the appellant, there would be no provision left in the Act for commencement of the proceedings against the debtor for realisation of the amounts finally decreed by the Tribunal under the Act. It is, however, not necessary for us to express a final opinion on this question as it does not arise for determination on the facts of this case.

(9) These appeals can be disposed of on the short ground that the decree which had been passed by the Tribunal on 30th December, 1953 and which is sought to be executed, had been passed in favor of two creditors of Lilawati debtor in her personal capacity and it related to another debt which is not the subject-matter of any application under section 5 of the Act. It is common ground that in the previous proceedings when the creditors filed an application under section 10, the debtor did not choose to exercise her right under section 11(2), but filed her independent application under section 5 and the previous decree, as was held by Mehar Singh, J., became final. In the said proceedings, neither any debt nor any property of Atma Singh deceased was involved. The subsequent application under section 5 of the Act has been filed by Lilawati as legal representative of Atma Singh deceased and it relates to the debts and properties of Atma Singh. and neither Bhagwan Dass, one of the creditors mentioned above, is a party to the said proceedings, nor is the debt of Rs. 1,10,000.00 decreed by the Tribunal their subject-matter. A debtor who had filed an application under section 5, is not entitled to obtain stay of execution of proceedings against another debtor in respect of a different debt and while no application under section 5 of the Act is pending in respect of the decree of the Tribunal dated 30th December, 1953. As such, the debtor-appellant is not entitled to claim stay of execution of the said decree in different proceedings relating to the debts and properties of Atma Singh deceased.

(10) The learned counsel for the appellant has cited Deochand v. Shv Ram, A. I. R. 1966 Supreme Court 615, (3)Shyamlal Ramkrishna Agarwal v. Takhatmal Bodhraj, : AIR1957MP98 (4) and Prakash Textile Mills v. Mani Lal, (5). None of these authorities supports the proposition that in proceedings under section 5 of the Act initiated by one displaced debtor, the execution of the decree passed by the Tribunal against another debtor in respect of a different debt can be stayed. These authorities are, thereforee, of no assistance in determining the controversy raised in this case. We hold that the order of lower Court is correct according to law and the appeal of Lilawati debtor has no force. Nothing has been urged on behalf of the creditors in support of the cross-appeal.

(11) As a result, both the appeals are dismissed. In the circumstances of the case, the parties are left to bear their respective costs.


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