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Debendra NaraIn Sinha and ors. Vs. Sourindra Mohan Sinha and ors. - Court Judgment

LegalCrystal Citation
CourtKolkata
Decided On
Judge
Reported inAIR1914Cal697,24Ind.Cas.391
AppellantDebendra NaraIn Sinha and ors.
RespondentSourindra Mohan Sinha and ors.
Cases ReferredWilliams v. Stern
Excerpt:
civil procedure code (act xiv of 1882), section 257a, repeal of - effect of repeal--execution of decree--agreement to give time to judgment--debtor--evidence act (i of 1872), sections 91, 92--'any matter required by law to be reduced to the form of a document,' whether covers case of decree--oral agreement between decree--holder and judgment--debtor to give time--oral evidence, if admissible--contract act (ix of 1872), section 63, where applicable. - .....257a of the code of civil procedure of 1882 is to make an agreement to give time to the judgment-debtor an agreement the legality of which must be tested like that of any other agreement, in other words, an agreement to give time to the judgment-debtor may now be entered into between the decree-holder and the judgment-debtor without the sanction of the court, and effect may be given to such an agreement, as to any other agreement, if valid in law. in fact, it has not been seriously contested on behalf of the respondents-decree-holders that the subordinate judge has erroneously held that the alleged agreement : was invalid because it had not been sanctioned by the court. the first reason on which the order of the subordinate judge is based consequently fails.3. as regards the second.....
Judgment:

1. This is an appeal by one of the judgment-debtors against an order for execution of a mortgage-decree. The final decree in the mortgage suit was made by consent of parties in this Court on the 20th August, 1909. One of the terms of the consent decree was to the effect that if a sum of Rs. 1,10,000 was paid to the plaintiffs on or before the 16th April 1910 in part satisfactions of the decree, the plaintiffs would not be entitled to put the decree into execution or apply for sale of the mortgaged premises till the 31st July, 1911. This sum was paid and on the 3rd April, 1912, the decree-holders applied for recovery of the balance of the judgment-debt by execution of their decree. To this application an objection was taken by the judgment-debtor, now appellant before us, on the ground that execution could not proceed, as the decree-holders had agreed not to execute the decree for a period of twelve years. The objection may be best stated in the words of the judgment-debtor himself : ' after the settlement, in presence of several men of position, the decree-holders expressly stated to these judgment-debtors, and the judgment-debtors believed in their words, and the belief was strengthened by their subsequent conduct, that though only two years' time for payment was stipulated in the sulehnama, yet in reality no attempt would be made to realise the decretal amount by the sale of the mortgaged properties within twelve years. That is, so long as the decree could be legally kept alive, so long it would be kept (unexecuted) : only, in order to keep alive the decree, the decree-holders would take such steps as would be required to keep the decree alive.' The Subordinate Judge has not taken evidence to determine whether the alleged agreement was made between the parties. But he has overruled the objection of the judgment-debtor on three grounds, namely, first, that the alleged agreement was inoperative, inasmuch as it had not been notified to and sanctioned by the Court : secondly, that oral evidence was not admissible in proof of the alleged parole agreement : and thirdly, that the agreement was void as made without consideration.

2. As regards the first ground assigned by the Subordinate Judge in support of his order, it is plain that he has taken an erroneous view of the law. Section 257A of the Code of Civil Procedure, 1882, provided that ' Every agreement to give time for the satisfaction of a judgment-debt shall be void unless it is made for consideration and with the sanction of the Court which passed the decree, and such Court deems the consideration to be under the circumstances reasonable.' This has not been reproduced in the Code of 1908 : yet the Subordinate Judge has held that Rule 11 of Order XX of the Code has substantially the same effect, although it is plain that the provision just mentioned has no application to mortgage-decrees. In our opinion the effect of the repeal of Section 257A of the Code of Civil Procedure of 1882 is to make an agreement to give time to the judgment-debtor an agreement the legality of which must be tested like that of any other agreement, in other words, an agreement to give time to the judgment-debtor may now be entered into between the decree-holder and the judgment-debtor without the sanction of the Court, and effect may be given to such an agreement, as to any other agreement, if valid in law. In fact, it has not been seriously contested on behalf of the respondents-decree-holders that the Subordinate Judge has erroneously held that the alleged agreement : was invalid because it had not been sanctioned by the Court. The first reason on which the order of the Subordinate Judge is based consequently fails.

3. As regards the second ground assigned by the Subordinate Judge in support of his order, it has been argued that Section 92 of the Indian Evidence Act excludes evidence of the alleged oral agreement. It has been contended that the effect of the agreement is to vary the terms of the decree made by this Court, and in support of this contention reliance has been placed upon the observations of Sir Barnes Peacock, C.J., in the case of Kristo Komul Singh v. Huree Sirdar 13 W.R. 44 : 4 B.L.R. (F.B.) 101. We shall assume, for the purposes of this argument, that the effect of the oral agreement is to vary the terms of the decree. The question, on this assumption, arises, whether Section 92 excludes evidence of the alleged oral agreement. Section 92 refers to contracts, grants or other dispositions of property mentioned in Section 91, and consequently, the terms of Section 91 must be first examined. This section provides that 'When the terms of a contract, or of a grant, or of any other disposition of property, have been reduced to the form of a document, and in all cases in which any matter is required by law to be reduced to the form of a document, no evidence shall be given in proof of the terms of such contract, grant or other disposition of property, or of such matter, except the document itself, or secondary evidence of its contents in cases in which secondary evidence is admissible under the provisions hereinbefore contained.' With reference to Section 91, it has been argued on behalf of the respondents that a decree falls within the scope of the expression any matter required by law to be reduced to the form of a document,' and that no evidence is admissible in proof of the terms of the decree other than the original document itself or secondary evidence of its contents where such secondary evidence is admissible. In support of this view reliance has been placed upon the cases of Dews v. Riley (1851.) 11 Com. Bench 434 : 2 L.M. & P. 544 : 20 L.J.C.P. 264 : 15 Jur. 1159 : 138 E.R. 542 : 18 L.T. 155 : 87 R.R. 718. Stonor v. Foule (1888) 13 13 App. Cas. 20 : 57 L.J. Q.B. 387 : 58 L.T. 1 : 36 W.R. 742 : 52 J.P. 228. Let us assume for the purposes of argument that the expression any matter required by law to be reduced to the form of a document' is comprehensive enough to include the case of a decree. We must next examine the terms of Section 92 which provides as follows : When the terms of any such contract, grant or other disposition of property (i.e., such contract, grant or disposition of property as is mentioned in Section 91) or-any matter required by law to be reduced to the form of a document, have been proved according to the last Section (91), no evidence of any oral agreement or statement shall be admitted, as between the parties to any such instrument or their representatives-in-interest, for the purpose of contradicting, varying, adding to, or subtracting from, its terms.' It is plain that the scope of this section must be determined upon an examination of all its terms and that full effect must be given to the expression as between the parties to any such instrument or their representatives in interest.' If this expression, which is applicable only in the case of documents of a dispositive character, is read along with, not only the words' contract, grant or other disposition of property' but also the words or any matter required by law to be reduced to the form of a document,' it becomes plain that the object of the Legislature was to deal only with two classes of cases, namely, first, contracts, grants or other dispositions of property which have been reduced to the form of a document, by the act of parties, as mentioned in Section 91, and, secondly, contracts, grants or other dispositions of property which are required by law to be reduced to the form of a document : in Other words, the expression, any matter required by law to be reduced to the form of a document,' controlled as it is by the expression as between the parties to any such instrument or their representatives in interest', has, in Section 92, a much narrower scope than in Section 91. It seems to us to be reasonably clear, that the expression, any matter required by law to be reduced to the form of a document,' in Section 92, if read, as it must be read, along with the expression, as between the parties to any such instrument or their representatives in interest,' cannot cover the case of a decree and that the Legislature did not intend that Section 92 should be applied to a case of the description now before us. This explains.

4. why in proviso 4 mention is' made only of contracts, grants or other dispositions of property' and not also of any matter required by law to be reduced to the form of a document.' That proviso is in these terms : 'The existence of any distinct subsequent oral agreement to rescind or modify any such contract, grant or disposition of property, may be proved, except in cases in which such contract, grant or disposition of property is by law required to be in writing, or has been registered according to the law in force for the time being as to the registration of documents.' It has been suggested on behalf of the respondents that the fourth proviso is of no assistance to the appellant. The obvious answer is that Section 92 has no application to the case, and, consequently, no question arises as to whether the appellant is entitled to the benefit of the proviso. We must, accordingly, hold that the second reason assigned by the Subordinate Judge in support of his order cannot be sustained and that oral evidence was admissible in proof of the alleged parole agreement.

5. As regards the third ground assigned by the Subordinate Judge in support of his order, the question has been elaborately argued before us, whether an agreement by a decree-holder to give time to the judgment-debtor is valid, even though there is no consideration for it. On behalf of the appellant, it has been broadly contended that the repeal of Section 257A of the Code of Civil Procedure of 1882 indicates that the Legislature intended to validate such an agreement even though there should be no consideration to support it. In our opinion, there is no foundation for this contention. Under Section 257A three elements have to be established to validate an agreement by the decree-holder to give time to the judgment-debtor : namely, first, that the agreement should have been made for consideration, secondly, that it should have received the sanction of the Court which passed the decree : and thirdly, that such Court should have deemed the consideration reasonable under the circumstances. The repeal of the section does not imply that the Legislature intended that an agreement of this character should be valid, even though there was no consideration therefor. In our opinion, the only effect of the repeal of Section 257A is to place such an agreement on the same footing as any other agreement, that is to say, such an agreement to be valid must be an agreement for consideration, although its validity is not affected by the circumstances that the consideration is not reasonable or that it has not received the sanction of the Court.

6. It has been argued, however, on behalf of the appellant that Section 63 of the Indian Contract Act indicates that an agreement of this character is valid, even though not supported by consideration. Now Section 63 provides that 'Every promisee may dispense with or remit, wholly or in part, the performance of the promise made to him, or may extend the time for such performance, or may accept instead of it any satisfaction which he thinks fit.' Reference has been made to the decision of Subramania Ayyar, J., in Davis v. Cundasami Mudali, 19 M. 398 : 6 M.L.J. 220. and it has been argued that Section 63 validates an agreement for extension of time for the performance of a promise, even though there be no consideration for such an ageement. It is not necessary for our present purpose to discuss whether the view taken in the case of Davis v. Cundasami Mudali 19 M. 398 : 6 M.L.J. 220. which was adopted in the cases of Mathew Henry Abraham v. Lodge Good Will 6 Ind. Cas. 758 : 20 M.L.J. 383 : (1910) M.W. 191 : 34 M. 156. and Gopala Krishna v. Bamminenni Venkatasubba Naidu 9 Ind. Cas. 763 : 9 M.L.T. 270. gives effect to the true intention of the Legislature. But we observe that this view was questioned in the case of Trimbak Gangadhar Ranade v. Bhagwandas Mulchand 23 B. 348. Section 63 of the Indian Contract Act occurs in the fourth Chapter which deals with the question of performance of contracts, and within that portion of the Chapter which treats of contracts which need not be performed, and it may well be maintained that the intention of the Legislature in Section 63 was only to lay down that after an extension of time has been granted by the promisee, he cannot, before the expiry of the time, call for the performance of the promise. It is not necessary, however, to deal with Section 63 at further length, because it is plain that the parties before us do not stand in the relation of promisor and promisee. The agreement into which they entered in settlement of their dispute has been sanctioned by the Court, and their relation is now defined by the decree of this Court. They stand in the position of a decree-holder and judgment-debtor, and it is plain that in a case of this description Section 63 cannot be deemed to have any application. It has been argued, however, that on general principles an agreement for extension of time may be valid, though not supported by consideration : and on the authority of Stead v. Dawber 10 A. and E. 57 at p. 66 : 50 R.R. 327 at p. 333 : 2 P. & D. 447 : 9 L.J. (n.s.) Q.B. 101 : 113 E.R. 22. it has been contended that the original consideration supports the new promise. In our opinion, there is no foundation for this contention. In the case of Stead v. Dawber 10 A. and E. 57 at p. 66 : 50 R.R. 327 at p. 333 : 2 P. & D. 447 : 9 L.J. (n.s.) Q.B. 101 : 113 E.R. 22. there was a written agreement for delivery of goods on a particular day and a subsequent verbal agreement for their delivery on a later specific date, and the Court came to the conclusion that the parties intended to substitute the later verbal agreement for the previous written agreement. It was in these circumstances that Lord Denman, C.J., observed that no difficulty arose from the want of consideration for the plaintiff's agreement to consent to the change of days : for the same consideration which existed for the old agreement was imported into the new agreement which was substituted for it. This principle has plainly no application to the circumstances of the case before us. It is not the case of either party that the rights and obligations of the parties under the consent decree have been superseded and that a new contract between the parties has taken its place. We may further observe with reference to the case of Stead v. Dawber 10 A. and E. 57 at p. 66 : 50 R.R. 327 at p. 333 : 2 P. & D. 447 : 9 L.J. (n.s.) Q.B. 101 : 113 E.R. 22. that although it was followed in Marshall v. Lynn 6 M. & W. 109 : 9 L.J. (n.s.) Ex. 126 : 55 R.R. 534., it has been criticised by Lord Coleridge in Hickman v. Haynes (1875) 10 Com. Pleas. 598 at p. 603 : 32 L.T. 873 : 23 W.R. 871 : 44 L.J.C.P. 358. and by Blackburn, J., in Ogle v. Earl Vane 2 Q.B. 275 : 36 L.J. Q.B. 175 : 15 W.R. 504 : 7 B. & S. 855 : 15 W.R. 564. On the other hand, it is plain from the decision in Williams v. Stern 5 Q.B.D. 409 at p. 412 : 49 L.J.Q.B. 663 : 42 L.T. 719 : 28 W.R. 109. that an agreement of this character to be valid and operative must be supported by consideration. In that case, there was a promise to give time for payment of an instalment under a bill of sale, and it was ruled that the promise to be operative and enforceable in law must be supported by consideration. We are, therefore, of opinion that the Subordinate Judge has correctly held that the agreement alleged by the judgment-debtor is not valid, if unsupported by consideration.

7. The question, finally, arises whether the order of the Court below should be affirmed. On behalf of the judgement-debtor, it has been urged that although the consideration for the alleged agreement was not specifically stated in the second paragraph of the petition of objection dated the 10th July, 1912, it was not really a fatal omission, as it was sufficient at that stage to allege the agreement, and the consideration might be proved later along with the factum of the agreement.

8. We are not prepared to give full effect to this contention : but at the same time, we are of opinion that it is desirable in the interests of justice that the facts should be investigated before the objection of the judgment debtor is overruled. The sum in, controversy is very large, and the Court below appears to have assumed that the rights of the parties could be determined by the solution of questions of law alone. We are, therefore, of opinion that this appeal should be allowed, the order of the Subordinate Judge set aside and the case remanded to him for investigation of the question of the alleged agreement. The judgment-debtor will be called upon to prove the agreement set up by him as also the consideration for it. If this is established, a further question will obviously arise, namely, whether the agreement is binding upon the decree-holders other than Sourindra Mohan Singh. This will necessarily lead to an examination of the question, whether if he ever entered into this agreement, he made it on behalf of himself as also of the other decree-holders, and if this is answered in the affirmative, whether he had authority to do so. We further direct, in order that the decree-holder may not be needlessly embarrassed, that the judgment-debtor should be called upon before the trial begins to state precisely the time and place of the alleged agreement and the nature of the consideration therefor. Each party will pay his own costs in this Court.

9. The Subordinate Judge is directed to expedite the hearing of the case. Let the records be sent down at once.


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