Alluri Bapanna vs Inuganti Vengayya and Others

Horwill, J.—On 26th June, 1923, Yellappu Bapanna obtained part satisfaction of her decree to the extent of Rs. 2,500 and in December of

the same year she obtained another sum of Rs. 1,000. Both these amounts were certified. On 3rd August, 1924, Rs. 2,520 were paid to her but

the payment was not certified. On 10th January, 1929, the decree was transferred to the present appellant by Ex. I. That document recites that

two sums of Rs. 2,500 and 2,520 respectively had been collected towards the decree amount, that the decree holder is entitled to execute for the

balance, and that she transferred her right to execute to the appellant. Both the trial Court and the lower appellate Court held that on a construction

of Ex. I the right transferred to the appellant was to execute for such sum as was due after making the deductions mentioned in the deed. In second

appeal Wadsworth, J., was of the same opinion and referred to the possibility that the document of transfer and the filing of E.P. No. 231 of 1929

by the appellant might amount to a certification within the meaning of Order 21, Rule 2. Against this judgment of Wadsworth, J., the present

Letters Patent Appeal has been preferred.

The main point discussed in this appeal is whether in view of the terms of Ex. I, the appellant is entitled to ignore the uncertified payment. The

argument of the earned Counsel for the appellant is that in spite of her admissions the decree^ holder herself could have executed for an amount

which included this uncertified payment and that as she had conveyed all her rights under the decree to the appellant, he had the right to ignore this

payment in executing the decree. Mr. Venkatarama Raju has argued with great insistency that the Full Bench case of this Court, Nalam

Subramaniam Vs. Devara Ramaswami and Others, , concludes the matter; but in that case it was only decided that a transferee decree-holder was

in no worse a position than the transferor and that the judgment-debtor was prevented by Order 21, Rule 2(3) from relying upon an uncertified

payment. It was not considered how far the rights of the transferee-decree-holder would be determined by the terms of the transfer deed or

affected by admissions that uncertified payments had been made. The fallacy in the argument of Mr. Venkatarama Raju lies in the supposition that

a decree-holder has a right to execute for a sum uncertified which he can transfer to another person. Certainly Sub-rule 3 to Order 21, Rule 2

does not give a right to a decree-holder to ignore any payment against the decree amount. On the contrary, Sub-rule 1 says that he shall certify the

payment. The purpose of Order 21, Rule 2(3) which merely prevents the judgment-debtor from pleading an uncertified payment, seems to be to

avoid unnecessary delay and to obviate the trial of complicated issues in execution proceedings which might prevent decree-holders from realising

promptly the fruit of their decrees. The transfer deed Ex. I expressly states that the decree-holder herself had no right to execute for this sum of Rs.

2,520 that she was entitled to execute only for the remainder, and that it was this right to execute for the remainder that she transferred to the

appellant. It was because he could not execute for this uncertified amount that the consideration for the transfer was correspondingly decreased.

No authority has been quoted to us for the contention of the earned Counsel for the appellant that the Court is bound to ignore the terms of the

transfer deed and the rights that the transferee obtains under the deed. Moreover when examined by the Court on his application to transfer the

decree, the appellant admitted that Ex. I gave him the right to execute only for what was due on the decree after deducting this uncertified payment.

We therefore hold that the decision of our learned brother on this point was correct.

We are also of opinion that his judgment can be supported on the ground that the certification by the decree-holder required by Order 21, Rule

2(i) was given. In Raja Shri Prakash Singh v. Allahabad Bank, Ltd. (1928) 56 M.L.J. 233 : L.R. 56 30 : ILR 3 Luck 684 , a Privy Council case

of 1928, the nature of the certification required under Order 21, Rule 2(i) was discussed, and it was held that no application by the decree-holder

was required and that even though the certificate was in the form of a petition the certificate was not in fact a petition. Their Lordships held that the

rule contemplates a simple procedure, namely, a certificate of payment given to the Court. In Thimma Redai v. Subba Reddiar (1918) 49 I.C.

141, Sadasiva Aiyar, J., says that:

A certificate under Order 21, Rule 2 by the decree-holder in his petition is a sufficient certificate.

In Chinna Mummidi Royal v. Raja Somasekara Chikka Royal AIR 1929 Mad. 811, the decree-holder admitted certain payments but stated

that the money was used for purposes which did not amount to a discharge of the decree. It was held that:

The fact that the plaintiff has not formally certified the payment but has only incidentally referred to a payment can make no difference.

This principle is only in accordance with common sense and equity. A decree-holder who admits to the executing Court that he has received a

payment cannot be allowed by that Court to execute his decree for the same amount over again. Such a procedure would make the process of the

Court farcical. In Chinnaswami Kavirayer v. Periathambi Butler AIR 1929 Mad. 811 a reference to an uncertified payment was made on an

affidavit. It was nevertheless held that such an admission amounted to a certification sufficient to satisfy the requirements of Order 21, Rule 2(1).

Eusuffzeman v. Sanchia Lal Nahata I.L.R.(1915) 43 Cal. 207 was a case in which the decree-holder referred to the payment in the execution

petition itself; and it was held that such a reference amounted to a certification of the payment. It would appear from the above cases that it does

not matter under what circumstances the payment by the judgment-debtor is brought to the notice of the executing Court by the decree-holder.

Such bringing to notice is sufficient to satisfy the requirements of Order 21, Rule 2 and to prevent the decree-holder from executing over again for

a sum that he admitted having received. It is argued by the earned Counsel for the appellant that even though it may not be necessary for the

decree-holder to put in a formal application to record payment, it is at any rate necessary that he should ask the Court to do so. Such a contention

is certainly not warranted by any of the decisions above referred to or by any other case to which our attention has been drawn. On the contrary,

in Chinna Mummidi Royal v. Raja Somasekara Chikka Royal AIR 1929 Mad. 783 the decree-holder, far from asking the Court to certify the

payment, strenuously opposed the certification.

The circumstances under which we are asked to find that there was a certification by the transferee decree-holder of this payment of Rs. 2,520

are that in 1929 the appellant filed E.A. No. 231 of 1929 (Ex. A) asking the Court to recognise the transfer. The appellant therein asked the Court

to peruse the E.P. records and after examining the deed of transfer to issue notice to the defendants under Order 21, Rule 16 and then to

recognise the transfer. He also requested the Court to transfer the decree u/s 39, Civil Procedure Code, to the District Munsiff''s Court, Kovvur,

for further execution. In our opinion this was sufficient to draw the attention of the Court to the deed of transfer, in which there was a recital that

this sum of Rs. 2,520 had been paid and that the right conferred by the decree-holder on the appellant was one to execute for such amount as

might be due after deducting that payment and another.

The earned Counsel for the appellant has also put forward a further argument that the judgment-debtor''s claim to have his payment recognised

is barred by res judicata, because he made no mention of this payment either during the execution proceedings in 1926 (where the decree-holder

had deducted only the two sums of Rs. 2,520 and Rs. 1,000) or in 1929 when execution proceedings were initiated by the appellant. It has often

been pointed out by this Court that Section 11 does not apply to execution proceedings; but for the same reasons that Section 11 became

necessary for controlling the trial of suits it has been necessary to apply the same or similar principles to execution proceedings. Caution has

however to be exercised in applying the principle of constructive res judicata to execution proceedings. It can only apply to cases where the Court

could not have acted as it did if the judgment-debtor had successfully raised the points which are sought to be held by this principle against him. In

general, a Court cannot order execution unless it is satisfied (i) that the petitioner has a right to execute; (ii) that the judgment-debtor is liable to

satisfy the decree; (iii) that the decree is executable; and (iv) that it is not barred by limitation. If therefore an executing Court orders execution to

proceed it must be presumed to have held that all these conditions are satisfied. If a judgment-debtor with due notice of the proceedings fails to

raise any objection on any of these grounds it must be held by the principle of constructive res judicata that his failure to do so has the same legal

effect as if it had been raised and decided against him. The mere fact that the sum for which the decree is sought to be executed is not the correct

amount due by the judgment-debtor to the decree-holder would not prevent execution from proceeding, and so the failure of a judgment-debtor to

dispute at the first opportunity the correctness of the figure would not bar him by the principle of constructive res judicata from raising that point in

subsequent proceedings or at some later stage of the same proceedings. The whole question of the operation of the principle of constructive res

judicata to execution proceedings has been very carefully discussed by Pakenham Walsh, J., in Ulaganatha v. Alagappa AIR 1929 Mad. 903 and

in Azhagappa Chetti v. Ramanathan Chettiar (1932) 64 M.L.J. 629 . In Azhagappa Chetti v. Ramanathan Chettiar (1932) 64 M.L.J. 629 he says:

There is ample authority for instance that where execution is taken out for an amount greater than that mentioned in the decree, failure to appear by

the defendant would not act as res judicata and prevent him from showing in subsequent proceedings that that amount is not due.

Pakenham Walsh, J., also refers to Kalyan Singh v. Jagan Prasad ILR (1915) 37 All. 5898, which is a decision to the same effect. We have

also seen an unreported judgment, C.M.S.A. No. 2 of 1929, also by Pakenham Walsh, J., in which it was sought to weaken the effect of the

words above quoted by referring to certain other expressions used in the same judgment, from which it might be argued that the above quoted

principle was of limited application. The learned Judge repelled this argument and held that it was of general application and would apply to all

cases where the judgment-debtor failed to object to the amount set out in the execution petition.

So far the earlier execution petition is concerned, Ex. B, E.A. No. 913 of 1926, it is clear that the judgment-debtor could not effectively put

forward the plea of payment because the Court could not take account of any such payment. His failure to raise a point that could not in any way

help him could not subject him to the bar of res judicata. As pointed out earlier, it is only points that if raised successfully would have modified the

orders of the Court that can possibly operate as res judicata. The earned Counsel for the appellant claims to have a stronger case with regard to

the conduct of the judgment-debtor at the time of the originating of the proceedings in 1929; for as Ex. A, read with the transfer deed, amounts to

a certification, then if the judgment-debtor had drawn the attention of the Court to the fact that the decree-holder admitted the payment,

satisfaction for the uncertified payment would presumably have been recorded. Even here however the principle of constructive res judicata would

not apply, because the judgment-debtor could not have influenced the conduct of the Court in those proceedings. Some amount still remained due

under the decree, even though full credit had been given for all the payments. The Court was therefore bound to acknowledge the right of the

appellant to execute the decree, and, as the property against which the decree had to be executed was situated within the limits of another Court,

to transfer the decree. The judgment-debtor was not therefore precluded by the principle of constructive res judicata from raising the plea of

payment at a later stage in those proceedings, after the decree had been transferred.

The Letters Patent Appeal therefore fails and is dismissed with costs.