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Thummalapenta Dhanalakshmi Vs. Pulipati Subbarayudu - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai High Court
Decided On
Case NumberCivil Revn. Petn. No. 1659 of 1951
Judge
Reported inAIR1954Mad581; (1954)IMLJ299
ActsCode of Civil Procedure (CPC) , 1908 - Sections 73 - Order 21, Rules 55, 83 and 89
AppellantThummalapenta Dhanalakshmi
RespondentPulipati Subbarayudu
Appellant AdvocateK. Kotayya, Adv.
Respondent AdvocateG. Chandrasekhara Sastry, Amicus Curiae
DispositionRevision allowed
Cases ReferredAtmaram Akaji v. Uderaj Sheodin
Excerpt:
.....- whether money deposited by judgment debtor under order 21 rule 89 will enure only to benefit of decree holder that brought properties to sale in execution of his decree or available for rateable distribution under section 73 - payment made to set aside sale under rule 89 is for payment to purchaser and payment to decree holder - wording of clause (b) rule 89 makes it abundantly clear that amount specifically ear marked for payment to decree holder as specified in proclamation of sale as that for recovery of which sale was ordered - money had to be paid to decree holder who had brought property to sale - held, when enactment lays down provision for disposal of money court had to act in accordance with directions contained therein. - - 648 as follows :as regards -air 1917 cal 740..........rateable distribution under section 73, civil p. c. the petitioner in this case, who obtained a money decree in o. s. no. 603 of 194s on the file of the district munsifs court, guntur, brought certain properties of the judgment-debtor to sale and they were purchased by a third party. the judgment-debtor applied to set aside the sale under order 21, rule 89 depositing five per cent, by way of solatium to be paid to the purchaser and the decree amount payable to the petitioner as mentioned in the proclamation of sale. the respondent herein, a decree-holder in o. s. no. 480 of 1947 on the file of the district munsif's court, ongole, who was executing his decree, applied for rateable distribution of the amount deposited by the judgment-debtor. the petitioner opposed this application.....
Judgment:
ORDER

Chandra Reddy, J.

1. This revision petition raises a question of some importance, viz., whether money deposited by a judgment-debtor under Order 21, Rule 89 will enure only to the benefit of the decree-holder that brought the properties to sale in execution of his decree or available for rateable distribution under Section 73, Civil P. C. The petitioner in this case, who obtained a money decree in O. S. No. 603 of 194S on the file of the District Munsifs Court, Guntur, brought certain properties of the judgment-debtor to sale and they were purchased by a third party. The judgment-debtor applied to set aside the sale under Order 21, Rule 89 depositing five per cent, by way of solatium to be paid to the purchaser and the decree amount payable to the petitioner as mentioned in the proclamation of sale. The respondent herein, a decree-holder in O. S. No. 480 of 1947 on the file of the District Munsif's Court, Ongole, who was executing his decree, applied for rateable distribution of the amount deposited by the judgment-debtor. The petitioner opposed this application contending that the same having been paid specifically for his benefit could not be distributed under Section 73, Civil P. C.

2. The District Munsif overruling the objection of the petitioner granted the prayer of the respondent. In doing so he relied upon a ruling of this court in -- 'Thiraviyam Pillai v. Lakshmana Pillai', AIR 1919 Mad 647 (A). The learned District Munsif thought that the trend of the reasoning in that case supported his conclusion.

3. The creditor, who is aggrieved by this order, has filed the present revision petition challenging the propriety of that order. Mr. Kotayya, appearing for the petitioner, submits that far from lending any support to the view taken by the learned District Munsif, -- 'AIR 1919 Mad 647 (A)' is clear authority for the proposition that a deposit made under p. 21, R: 89 is not available for rateable distribution.

4. Therefore the point that falls to be decided in this petition is, whether the view taken by the learned Munsif is correct. Before going into that question, it is useful to set out the terms of Order 21, Rule 89, Civil P. C.

'89(1). Where immoveable property has been sold in execution of a decree the judgment-debtor or any person deriving title from the judgment-debtor or any person holding an interest in the property, may apply to have the sale set aside on his depositing in court,

(a) for payment to the purchaser, a sum equal to five per cent, of purchase money, and

(b) for payment to the decree-holder, the amount specified in the proclamation of sale as that for the recovery of which the sale was ordered, less any amount which may, since the date of that proclamation of sale, have been received by, the decree-holder.'

It will be seen that the payment to be made under this rule is for two purposes, namely, the payment to the purchaser and the payment to the decree-holder. What is argued for the respondent is that in spite of the mention of the purpose for which the amounts are deposited into court, the money should be distributed equally amongst a.ll the decree-holders, whose applications for execution are pending in view of the provisions of Section 73. Civil P. C. Section 73, Civil P. C. provides :

'Whereas assets are held by a court and more persons than one have, before their receipt of such assets, made application to the court for the execution of decrees for the payment of money passed against the same judgment-debtor and have not obtained satisfaction thereof, the assets, after deducting the costs of realisation, shall be rateataly distributed among all such persons.....'

The view pressed upon me is that the expression 'assets held by a court' is wide enough to include the amounts deposited under Order 21, Rule 89 and would therefore come within the ambit of that section. I will now proceed to examine the soundness of this contention with reference to the decided cases.

5. In -- 'AIR 1919 Mad 647 (A)', the judgment-debtor was permitted in a pending execution petition to raise money by private alienation under Order 21, Rule 83 and put it into court. The question arose as to whether other creditors, whose execution applications were pending, could ask for rateable distribution of that money. The learned Judges Seshagiri Aiyar and Napier JJ. answered the question in the affirmative, as in their opinion the money paid in such circumstances was an asset held by the court under Section 73, Civil P. C., and was therefore liable for distribution amongst the several decree-holders, who have applied for execution. The decree-holder in the execution of whose decree the money was deposited into court relied on a decision in -- 'John Carapict Galstaun v. Woomes Chandra', AIR 1917 Cal 740 (B), for the position that such a deposit was not available for rateable distribution. While distinguishing that case the learned Judges observed at p. 648 as follows :

'As regards -- 'AIR 1917 Cal 740 (B)', that was a decision under Order 21, Rule 89. That order distinctly provides for payment to the decree-holder or to the purchaser, consequently the payment must be taken to have been ear-marked.'

Having regard to these remarks I fail to see how this ruling could be relied upon by the trial court as supporting its view. On the other hand it is in favour of th'e proposition put forward on behalf of the petitioner.

6. Another ruling of this court, which has been brought to my notice, Is -- 'Kasturl Aiyangar v. Arunachalam Chettiar', AIR 1917 Mad 739 (C). There the learned Judges Had to decide whether the money paid by persons claiming an interest in the property sold, and not by the judgment-debtor under Order 21, Rule 89 was liable for rateable distribution. A third party claiming that the property sold was his and not that of the judgment-debtor and was therefore not liable to be sold applied for setting aside the sale depositing the amounts as required by the provisions of Order 21, Rule 89. One of the questions that arose for deter-mination was whether that amount could be distributed rateably amongst all the decree-holders that applied for execution.

It was held by the Bench of this court that, as the depositors had no right to make such payments and were mere volunteers, the rateable distribution ordered by the lower courts amongst the several creditors could be upheld. In considering that point the learned Judges observed that if the depositors had a right to make a payment under Section 310-A corresponding to the present Order 21, Rule 89 then the money deposited by them for payment to the decree-holder could not be lawfully distributed rateably under Section 295, which is equivalent to the present Section 73, in view of the terms of Section 310-A, Clause (b). No doubt the question now before me did not arise directly in those cases and the observations are merely obiter but they are entitled to weight and I express my respectful accord with them.

7. There is another ruling of this court in --'Murugappan Chettiar v. Palaniappa Chetti', AIR 1918 Mad 704 (D), in which this very point had to be determined. Phillips J. following the decision in -- 'Harai Saha v. Faizlar Rahman', 40 Cal 619 (E), held that, as the amounts were paid under Order 21, Rule 89. for a specific purpose and were held by court solely for that purpose, they were not available for rateable distribution under Section 73, Civil P. C. To the same effect are the observations of Eeasley C. J. in -- 'Subbayya v. Venkata-subba Reddi' : AIR1935Mad1050 .

8. It may be mentioned that no decision of this court, which has taken a contrary view, has been brought to my notice. It is thus seen that this court has been consistently taking the view that the deposit made under Order 21, Rule 89 being for the specific purpose of paying it to the decree-holder in the execution of whose decree the properties are brought to sale cannot be distributed rateably.

9. This view is shared by the High Court of Calcutta also. The same question arose in -- '40 Cal 619 (E)'. There the learned Judges expressed the opinion that although the wording of Section 73 of the present Code is wider than that of Section 295 of the old Code, the enactment in Section 310-A of the old Code, which is practically reproduced in Order 21, Rule 89, remains unaltered and that the money paid into court under Order 21, Rule 89 was not liable to be distributed under Section 73, Civil P. C. The learned Judges referred to the earlier decisions of that court and remarked that all those decisions were good law in spite of the change introduced in Section 73. It may be mentioned here that while under Section 295 the subject-matter of rateable distribution was 'assets realised by sale or otherwise in execution of a decree', the present section contains the words 'assets held by the court'.

10. Another Bench of that court took a contrary view in -- 'Chittagong Urban Co-operative Bank Ltd. v. Indo Burmah Traders Bank Ltd.', AIR 1933 Cal 521 (G). The opinion expressed in that case was that the expression 'assets' in Section 73 of the Code includes assets held by court, the ultimate purpose of which was to satisfy decrees subsisting against a judgment-debtor and the source from which the assets originated was not quite material so long as they remained in the custody of court. This was merely obiter, for the learned Judges remarked that it was unnecessary to consider whether -- '40 Cal 619 (E)' was correctly decided or not, since in their opinion the case before them was not a suitable one for the exercise of the discretion under Section 115, Civil P. C. I am unable to subscribe to the principle laid down in that case. Whether the source of the assets is material or not depends upon the specific terms and conditions upon which the court takes the deposit. Further the basis of this rule is -- 'Noor Mahomed v. Bilasiram Thakursidas', AIR 1920 Cal 785 (H) and -- 'Bhattoo Singh v. Raja Raghu-nandan Prasad Singh', : AIR1933Pat303 (IK I will show presently that the former case does not really support the view of the learned Judges, while the latter, which is also mainly founded on --'AIR 1920 Cal 785 (H)'. is not correctly decided.

11. A recent decision of the same court in -- Pannalal v. Lakshmisona' : AIR1952Cal840 (J) has dealt with this point exhaustively and it contains a complete review of the case-law on the subject. The learned Judge followed the rulings of this court and of the Calcutta High Court in -- '40 Cal 619 (E)'. It was ruled there that the money deposited being intended for the decree-holder in execution of whose decree the property was sold was exempt from rateable distribution. The learned Judge also negatived the contention that Order 21, Rule 89 being only a rule passed under the rule mating powers of the High Court should be read subject to Section 73 which is in the main body of the Code. It is remarked that the rules are as much a part of the Code as the sections and they have as much effect as the sections of the Code, and that Section 73 of the Code should be read subject to O, 21, Rule 89.

12. In this context I may also refer to the dictum laid down in -- 'Narayan .Vasudevacharya v. Amganda', : AIR1921Bom169 (K) :

'The money deposited is ear-marked (a) for payment to the purchaser of a sum equal to five per cent, of the purchase money; (b) for payment to the decree-holder of the amount specified in the proclamation of sale as that for recovery of which the sale was ordered less any amount received by the decree-holder since the proclamation of sale.

It has been held that there could be no rateable distribution under Section 275 of the Code of 1882 of money deposited under Section 310-A as it was not money realised by sale or otherwise in execution of a decree but money to which the decree-holder was solely entitled.'

The learned Judges cited with approval a number of Calcutta cases in support of these observations. No doubt the point did not arise directly in that case and these remarks were made by the learned Judges in considering the question 'Whether the money paid under protest would satisfy the conditions of Order 21, Rule 89.' There a person alleging that the properties sold as those of a judg-ment-debtor in a case were really his, deposited the money under Order 21, Rule 89. After having succeeded in getting the sale set aside he sued for refund of the deposit made by him. His suit was dismissed on the ground that the amount paid under Order 21, Rule 89 must be taken to have been deposited for payment to the persons concerned in that rule unconditionally and voluntarily.

13. A discordant note is struck by the Patna and Nagpur High Courts. In -- 'AIR 1933 Pat 883 (I)', there was a conflict between the decree-holder In the execution of whose decree the properties were brought to sale and for setting aside of which the deposit under Order 21, Rule 89 was made and other decree-holders, who were executing the decree. A Bench of the Patna High Court held expressing a dissent from the rulings of our Court and purporting to follow the decision in -- 'AIR 1920 Cal 785 (H)', that money paid into court for the benefit of a particular decree-holder under Order 21, Rule 89, Civil P. O. was all the same an asset in the hands of the court within the meaning of Section 73 of the Code. The learned Judges thought that there was no logical ground for excluding from liability to rateable distribution any payment made into court under stress of execution for the benefit of any of the decree-holders entitled to rateable distribution. It was further observed :

'In our judgment, the position is not affected by the fact that the sum of five per cent. which is deposited for payment to the auction purchaser is not liable to rateable distribution; the auction purchaser is not in any way concerned with the order under Section 73.'

Jt was observed further on.

'and the fact that under Order 21, Rule 89, this money is described as being paid for payment to the decree-holder does not make it ear-marked for his exclusive benefit any more than any other money realised under stress of execution towards satisfaction of his decree is to be regarded as specially ear-marked so as to remove it from the operation of Section 73, Civil P. Code.'

As I have already pointed out the learned Judges relied for their conclusion on certain observations of Sir George Rankin J. in -- 'AIR 1920 Cal 785 (H)'. A reference to the decision of Sir George Rankin J, in -- 'AIR 1920 Cal 785 (H)', shows that it does not as a matter of fact lend any support to the observations of the learned Judges. That was a case that arose under Order 21, Rule 55, Civil P. C. The learned Judge dissenting from --'Sorabji Cooverji v. Kala Raghunath', 36 Bom 158 (L), held that money brought into court for removal of attachment under Order 21, Rule 55 was an asset held by a court within the meaning of Section 73, Civil P. C. In my judgment the observations In that case were confined to the interpretation of Order 21, Rule 55, Civil P. C. That they were not meant to go beyond that is seen from the following remarks of the learned Judge:

'If for example a defendant is made to pay into court the amount of the plaintiff's claim as a condition of getting an adjournment, it does not follow from my reading of Section 73 that other creditors could claim to share. Nor could they under Order 21, Rule 52 where funds in court are themselves the subject matter of the execution.'

It is manifest that the learned Judge did not Intend to lay down that all moneys in court for whatever purpose they might have been realised were liable to rateable distribution.

14. Further that the Bench in -- ' : AIR1933Pat303 (I)', reached the conclusion that they did with' some hesitancy is obvious from the observations in that report at p. 304 :

'But there is some ground for doubt as to whether money paid into court under Order 21, Rule 89, ought not to be exempted from this category.'

Again in the course of the judgment it is stated at pp. 304-305 :

'It may be true that under the provisions of Order 21, Rule 89 the court would ordinarily have no discretion to dispose of the money deposited otherwise than by making it over to the Individual decree-holder in whose name the particular execution may be proceeding; but this does not necessarily mean that if other decree-holders have already established their claims to rateable distribution, they shall not be entitled to share in the amount thus realised'

A reference was also made by the learned Judges to -- 'Sidh Math Tewari v. Tegh Bahadur Singn' : AIR1932All411 . But that has not much of a bearing on the question relating to the interpretation of Order 21, Rule 89, as the point for decision there was whether an amount deposited into court with a view to set the sale postponed was an asset held by the court within the meaning of Section 73 of the Code or not.

15. With great respect to the learned Judges who decided : AIR1933Pat303 , I express my dissent from the view taken by them in that case, as it is not supported either by provisions of Order 21, Rule 89 read with Section 73 or the decision relied on by them. There are three decisions by Niyogt J. of Nagpur High Court in -- 'Sadasheo Appa v. Pun-jabrao', AIR 1932 Nag 155(N); -- 'Atmaram v. Ude-raj', (O) and -- 'Atmaram Akaji v. Uderaj Sheodin', (P), which take the same view as that of the Patna High Court. The ratio of these decisions is that the expression 'assets held by a court' is of wider Import so as to embrace all moneys received by a court in execution of decrees irrespective of the purpose for which they were paid and the mode in which they have been realised. For the reasons mentioned above, I am unable to agree with this,

16. It is argued by Mr. Chandrasekhara, Sastri that in every ease, when money is deposited into court, it is ear-marked for a particular purpose and that there is nothing special about Order 21, Rule 89 in that respect. He drew my attention to Order 21, Rule 55 and Order 21, Rule 83 apart from relying on the observations of the Patna and Nagpur High Courts, and argues that there is no particular reason why the money deposited under Order 21, Rule 89, should be exempt from rateable distribution. According to the learned counsel Order 21, Rule 89 has nothing to do with a conflict between the various decree-holders and it does not deal with rateable distribution. It is concerned only with the deposit of money and the distribution of it is regulated by Section 73, Civil P. C.

17. I do not think I can accept this contention. I must first observe that apart from Rule 89 there is no other provision under Order 21, which lays down the purpose for which money should be specifically deposited. The provisions of Order 21, Rule 55 do not give any support to the view urged by Mr. Chandrasekhara Sastri upon me. Order 21, Rule 55 runs thus:

'Where (a) the amount decreed with costs and all charges and expenses resulting from the attachment of any property are paid into court, or, (b) the satisfaction of the decree is otherwise made through the court or certified to the court, or (c) the decree is set aside or reversed, the attachment shall be deemed to be withdrawn etc.'

It is seen that unlike the terms of Order 21, Rule 89 this rule does not specify the purpose for which the money is received is to be brought into court. It only lays down that on payment of the decretal amount with costs the attachment shall be deemed to have been withdrawn. Similarly Order 21, Rule 83 does not mention any particular purpose for which the money raised by private alienation is to be brought into court. A comparison of Order 21, Rule 89 and the other provisions referred to above reveals the distinction that exists between the two cases. The wording of Clause (b), Rule 89 makes it abundantly clear that the amount is specifically ear-marked for payment to the decree-holder as specified in the proclamation of sale as that for the recovery of which this sale was ordered, It clearly indicates that it has to be paid only to the decree-holder, who has brought the property to sale. When an enactment lays down a provision for the disposal of the money, the court has to act in accordance with the directions contained therein.

18. It is urged by Mr. Chandrasekhara Sastrithat it would be anomalous to hold that while theother decree-holders would also be entitled to rateable distribution, when the money is depositedby the purchaser, who buys the property in sale,the money deposited by the judgment-debtor forsetting aside a sale would not be available fordistribution amongst the other creditors also. Wehave to interpret the provision of law as it isand we are not concerned with the anomalies. Ifsuch anomalies really exist it is for the otherbodies to remedy those defects. I also do notfeel that there is really any such anomaly for thereasons pointed by Mukherji J. in : AIR1952Cal840 (J)'. However I am not now concernedwith that problem. For the foregoing reasons Iam in respectful agreement with the view takenby this court in the decisions cited above andin -- HO Cal 619 (E)' and other cases of thatline, and hold that the amount deposited under Order 21, Rule 89, Civil P. C. is not available for rateable distribution, as it is intended solely for thepurpose of paying to the decree-holder in execution of whose decree the properties were broughtto sale. It follows that the order of the trialcourt is unsustainable and ought to be set aside.This civil revision petition is allowed with costsincluding the sum paid to Mr. ChandrasekharaSastri, whom I should thank for having assisted mo in the disposal of this case.


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