Atmakuru Butchiah Chetti vs S. Tayar Rao Naidu and Others

Pakenham Walsh, J.—The facts which have given rise to these appeals are as follows:

The plaintiff, whom we may call Appanna, and the 1st defendant, whom we may call Butchiah, were brothers. O.S. No. 30 of 1922 was instituted

in the Court of the District Judge of Ganjam. for partition of the family property worth three or four lakhs. Defendants 2 to 4 in the suit were minors

represented by their guardian, the 1st defendant. In 1923 there was a compromise with reference to certain outstandings due to the family and

certain decree debts whereby the 1st defendant was to take over the plaintiff''s share in the outstandings and the plaintiff was to be paid Rs.

17,000. This compromise is dated the 23rd of October, 1923 and was filed into Court on the 29th of October. It was signed by the plaintiff''s

pleader on the 27th of October and by the defendants'' pleader on the 29th of October. It only related to some of the family properties and it was

sanctioned by the Court so far as the minor members were concerned as it was in their interests on the 1st of November; and on the next day the

Court passed the following order:

This compromise of part of the matters in dispute in the suit is recorded; so far as the minor defendants are concerned it has been sanctioned (I.A.

No. 380 of 1923).

As regards the Immovable property, there was a disposal by a preliminary decree on the 21st of February, 1924 and a Commissioner was

appointed to make a division; and as regards the rest of the property there was a reference to arbitration and an award was passed on the 20th of

December, 1926. This was remitted back and another award was made on the 20th of September, 1927 Under this award the 1st defendant had

to pay about Rs. 11,000 to the plaintiff. The final decree was passed on the 27th of September, 1927, incorporating all the matters in one decree.

This decree recites the compromise recorded between the parties on the 23rd of October, 1923. The plaintiff had several creditors who attached

the decree so obtained by him. When execution was sought, the defendants took two objections, (1) that, with regard to the compromise of 1923,

Rs. 15,000 had already been paid before the decree was passed ''and a receipt, Ex. XV, signed by the plaintiff on the 27th of October, had been

filed into Court on the 29th of October, and therefore credit must be given for this sum, and (2) that, with regard to the sum of Rs. 11,448 which

the defendants had to pay under the award dated the 20th of September, 1927, the plaintiff, being in need of money to conduct the suit, had

money advanced to him by the 1st defendant up to Rs. 7,000 and credit for this should be given. The learned District Judge refused to go into

either of these questions on the ground that he could not go behind the decree which was sought to be executed. The present appeals are against

this order and similar orders which he passed on execution petitions by other creditors.

It may be mentioned that this receipt Ex. XV seems to have been filed into Court on the 29th of October, 1923, as it bears the Judge''s initials

on that date. There are no indications of who filed it and it is not alluded to at all in the compromise petition, dated the 23rd of October, 1923 and

filed into Court which the pleaders for both the parties have signed. The plaintiff when examined in O.S. No. 30 of 1922, in the course of his

statement about Ex. XV, said, ""I signed the receipt Ex. XV. Defendant 1 (Butchiah) must have done as directed in Ex. XV."" The learned District

Judge rightly says that this evasive statement cannot be regarded as an admission by Appanna that he had actually received Rs. 15,000 under Ex.

XV.

In arguing against the order of the learned District Judge, the learned advocate for the appellant takes up the position (1) that Order 21, Rule 2

is not applicable to the case as it applies only to payments made after the decree and the parties must be in the position of judgment-debtor and

decree-holder, and (2) that, even if it does fall under Order 21, Rule 2, there is sufficient intimation to Court by the plaintiff and no further

certification is needed. His main contention is that this pre-decree arrangement can be pleaded as a bar in execution of the decree. On the first

point that the matter does not fall under Order 21, Rule 2, we have no hesitation in agreeing with him. If authority were needed for the position,

Rama Ayyam v. Sreewivasa Pattar ILR (1895) M. 230 : 5 M.L.J. 218 might be quoted. The present case is even stronger, for that was a case of

adjustment after decree but not between the judgment-debtor and decree-holder. But even if we were to hold that Order 21, Rule 2 can possibly

apply on a strained view that this receipt Ex. XV was to come into effect after the decree, we are of opinion that the provisions of the rule would

not have been complied with. No doubt, as remarked by the Privy Council '' in (1928) L.R. 56 I.A. 30 (Privy Council) , a mere intimation by the

decree-holder of payment is sufficient; and special application is not necessary. But in this case there is nothing to show that the plaintiff ever

intimated the receipt of this sum to the Court. As noted above, his statement with regard to the amount having been paid is evasive. The document

was one which should have been in the custody of the defendants and presumably therefore it was filed into Court by the defendants. Under Order

21, Rule 2 (2), a judgment-debtor has got considerably more to do in order to get such payments recognised than merely to put the document into

Court. The provisions of Order 21, Rule 2 (2) have to be complied with and notice sent to the decree-holder as to why the Court should not

record the payment. It is unnecessary to pursue this matter further in our view that Order 21, Rule 2 does not apply to the present case.

There remains the further question whether an arrangement by the parties after the commencement of the suit but before the decree which has

not been embodied in the decree can be set up or gone into in execution. The central point in this discussion is the ruling of the Full Bench in

Chidambaram Chettiar v. Krishna Vathiyar ILR (1916) M. 233 : 32 M.L.J. 13 [Abdur Rahim, Offg. C.J., Seshagiri Aiyar and Phillips, JJ., the

latter dissenting.] What was actually decided in that case was that an arrangement for stay of execution of the decree entered into in the course of

the suit can be gone into in execution. The High Court of Calcutta has always taken the view that it cannot, vide Benode Lal Pakrashi v. Brajendra

Kumar Saha ILR (1902) C. 810 and Hassan Ali v. Gaud Ali Mir ILR (1903) C. 179 at 181. In the other direction there are Laldas Narandas v.

Kishordas Devidas ILR (1896) B. 463 and Gauri Singh v. Gajadhar Das (1909) 6 A.L.J. 403. The previous Madras decisions and those

subsequent to it up to Venkatasubba Miudali v. Manickammal ILR (1925) M. 513 : 50 M.L.J. 364 have been clearly set out by Wallace, J., in his

judgment in the latter case. He points out that Rama Ayyan v. Sreenivasa Pattar ILR (1895) M. 230 : 5 M.L.J. 218 is not in point. The other two

decisions, Krishnamacharlar v. Rukmani Ammal (1904) 15 M.L.J. 370 and Subramanla Pillai v. Kumaravelu Anibalam ILR (1915) M. 541 lay

down in general terms that a pre-decree arrangement that a decree when obtained should not be executed can be pleaded in bar of execution.

Subsequent to the Full Bench case, Chidambaram Chettar v. Krishna Vathiyar ILR (1916) M. 233 : 32 M.L.J. 13, as observed by Wallace, J.,

there have been two divergent lines of decisions, one following this general principle and the other limiting the application of the Full Bench case.

Amongst the former, he quotes Sambasiva Aiyar v. Thirumalai Ramanuja Thathachariar (1918) 37 M.L.J. 356 and Velu Thevan v. Krishnaswami

Reddi (1924) 48 M.L.J. 277. Two cases not quoted by him which had been decided in this direction at that time are Pedda Veeranna v.

Gondimalla Veeranna (1916) 5 L.W. 718 and Arunachala Goundan v. Swaminatha Aiyar (1923) 46 M.L.J. 240. On the other side he quotes

Mallayya v. China Kotayya (1921) 14 L.W. 317 which he distinguishes as an agreement before suit, K.V.R. Rm. Vr. Ramanathan Chettiar (dead)

and Others Vs. A. Venkatachellam Chettiar (dead) and Others, , Arumugam Pillai v. Krishnaswami Naidu ILR (1920) M. 725 : 39 M.L.J. 222

and Singa Raja and Others Vs. Pethu Raja and Others, , which last case he says is not in point as it turns on the interpretation of Order 34, Rules

2 (c) and 5, and makes no reference either to Chidambaram Chettiar v. Krishna Vathiyar ILR (1916) M. 233 : 32 M.L.J. 13 or Arumugam Pillai

v. Krishnaswami Naidu (1920) ILR 43 M. 725 : 39 M.L.J. 222. He does not, however, quote Doraisami Moopan v. Subbalakshmi Palayee

Ammal (1917) 8 L.W. 205. This was a decision given on 17th December, 1917, shortly after the Full Bench case Chidambaram Chettiar v.

Krishna Vathiyar ILR (1916) M. 233 : 32 M.L.J. 13 which was in August, 1916. It held that the Full Bench case was not applicable to an

agreement between the parties to a suit that no decree should be obtained therein. Since the decision in Venkatasubba Mudall v. Manickammal

ILR (1925) M. 513 : 50 M.L.J. 364, there is a decision of a single Judge in Mulla Ramsan v. Mating Po Kaing ILR (1926) Rang. 118, which

considers the Calcutta, Madras and Bombay cases.

The learned advocate for the respondent argues that the present case does not fall under the Full Bench decision in Chidambaram Chettiar v.

Krishna Vathiyar ILR (1916) M. 233 : 32 M.L.J. 13. He says that the principle really laid down in that case is that, if there was any pre-decree

arrangement by way of stay or non-execution of I he decree, then such an arrangement relates to execution and can be pleaded as a bar in

execution proceedings. But he urges that the cases subsequent to the Full Bench case have also emphasized another principle that the decree itself

cannot be challenged in execution owing to an arrangement made during the suit. We think that there is a clear distinction between the two things;

and if the cases are analysed it will be found that those which conflict with each other are almost all border line cases where, though in substance

the effect of the agreement may be to alter the decree, in form it only affects its execution. Bearing this principle in mind, if we take the cases

decided prior to the Full Bench case, we find that Subramania Pillai v. Kumaravelu Ambalam ILR (1915) M. 541 was a case of an arrangement

prior to the decree to enter up satisfaction of the decree. It was held that this could be gone into in execution. Here, in form, the matter was one of

execution of the decree, though, in fact, the effect may have been to annul the decree. Laldas Naramdas v. Kishordas Devidas ILR (1896) B. 463

was a case of an agreement that as between two defendants costs should only be recovered from one of them. Here, in form, the matter may be

held to be one of execution, though, in fact, the result may have been to alter the decree with regard to the costs recoverable from the defendants.

Turning to the cases subsequent to Chidambaram Chettiar v. Krishna Vathiyar ILR (1916) M. 233 : 32 M.L.J. 13, the remarks about the Full

Bench case in Sambasiva Aiyar v. Thirutnalai Ramanuja Thathachariar (1918) 37 M.L.J. 356 are really obiter, as that case was decided under

Order 21, Rule 2, and it was held that there had been no certification. Velu Thevan v. Krishnaswami Reddi (1924) 48 M.L.J. 277 was a case of

an agreement prior to the decree not to execute the decree that might be passed against one judgment-debtor and to realise the whole amount

from the other. Here it was held that this could be pleaded in execution. Here again, in form, the matter arises in execution though the effect of the

arrangement may be to alter the decree as against one of the defendants. In Arunachala Goundan v. Swaminatha Aiyar (1923) 46 M.L.J. 240 it

was decided that the judgment-debtor can raise in bar of an application for execution presented by the legal representative of the (decree-holder

any defence such as that of estoppel which is personal to the legal representative. It is not clear from the report what the precise nature of the

agreement between the decree-holder and the judgment-debtor was, and the matter turned on whether the legal representative was estopped from

disputing it.

As regards the cases which are adverse to the appellant since the Full Bench case and which turn on questions of this sort, the first is Doradsami

Moopan v. Subbalakshmi Palayee Animal (1917) 8 L.W. 205. This, as pointed out above, was soon after the Full Bench decision. The next,

Arumugam Pillai v. Krishnaswami Naidu ILR (1920) M. 725 : 39 M.L.J. 222, is an important case. One of the Judges was Seshagiri Aiyar, J.,

who was a member of the Full Bench in Chidambaram Chettiar v. Krishna, Vathiyar ILR (1916) M. 233 : 32 M.L.J. 13. Here the arrangement

was that the decree which might be passed should be inexecutable in part. It was held that such an agreement could not be enforced in execution.

Seshagiri Aiyar, J., says:

In Chidambaram Chettiar v. Krishna Vathiyar ILR (1916) M. 233 : 32 M.L.J. 13. I rested my conclusion on the theory of stare decisis. It is

argued before us by Mr. Jayarama Aiyar, that it follows from my judgment in that case that all the cases referred to therein as supporting the theory

of state decisis must be taken to have been accepted by me as correct. 1 do not think this suggestion is well founded. The course of decisions was

referred to for the general proposition that pre-decree arrangements are within the language of Section 47. 1 did not intend to accept as correct

every one of the decisions I quoted for that purpose. On the other hand I want to make it clear that Chidambaram Chettiar v. Krishna Vathiyar

ILR (1916) M. 233 : 32 M.L.J. 13 should not, in my opinion, be applied to what are termed cognate cases. Further, I am clear that an attack

against the decree as having been obtained by fraud by one of the parties thereto is not within the principle of Chidambaram Chettiar v. Krishna

Vuthiyar ILR (1916) M. 233 : 32 M.L.J. 13.

This is a very important observation coming from one of the learned Judges who decided Chidambaram Chettiar v. v. Krishna Vathiyar ILR

(1916) M. 233 : 32 M.L.J. 13 and it is especially valuable because the only case directly on all fours with the present case which has been quoted

to us, namely, the decision in Pedda, Veeranna v. Condimalla Veeranna (1916) 5 L.W. 718, was a decision passed by the same Judge with

Ayling, J., between the Full Bench case and this decision. It is the only case which has been quoted to us of an agreement sought to be set up in

execution, which seeks to attack the decree itself as in the present case, and was allowed to be pleaded in execution. There, in pursuance of an

award made by arbitrators, the debtor tendered the amount payable on the due date, but the creditor refused to accept it and contested the validity

of the award. The debtor filed a suit to enforce the award and it was made a decree of Court. In execution of the decree, the decree-holder

claimed interest on the sums mentioned in the award. It was held that as there was a tender prior to suit and as the tender was refused the decree-

holder was not entitled to interest. This decision was rested on Chidambaram Chettiar v. Krishna Vathiyar ILR (1916) M. 233 : 32 M.L.J. 13,

and it is important to note that, as observed above, Seshagiri Aiyar, J., who was a party to that decision, expressly in the later case, Arumugam

Pillai v. Krishnaswami Naidu ILR (1920) M. 725 : 39 M.L.J. 222 restricted the principles which he meant to lay down in the Full Bench case. On

the other side, there are several authorities both of this Court and other Courts that an agreement which directly strikes at the decree itself cannot

be pleaded in execution. The first as noted above is Doraisami Moopan v. Subbalakshmi Palayee Animal (1917) 8 L.W. 205 in which it was held

that an agreement between the parties to a suit that no decree should be obtained therein could not be pleaded in execution and that the Full Bench

decision in Chidambaram Chettiar v. Krishna Vathiyar ILR (1916) M. 233 : 32 M.L.J. 13 did not apply to such a case. We have quoted

Arumugam Pillai v. Krishnaswami Naidu ILR (1920) M. 725 : 39 M.L.J. 222. In Mallayya v. China Kotayya (1921) 14 L.W. 317. the

respondents obtained a decree on their mortgage and sought the execution of the decree. The appellants set up an agreement entered into before

the suit by which the respondents agreed to accept Rs. 1,500 and release certain items. It was held that this agreement could not be pleaded as a

defence in execution of the decree. Spencer, J., remarked:

The conduct of a party who collusively allows a Court to pass a decree at the same time privately agreeing with the plaintiff that such a decree

should not be enforced is, in my opinion, committing a fraud on the Court, which should not be countenanced by permitting him to put forward

such a plea in execution.

That case no doubt is distinguished by Wallace, J., in Venkatasubba Mudali v. Manickammal ILR (1925) M. 513 : 50 M.L.J. 364 by saying

that it was a case of a pre-suit and not of a pre-decree arrangement. But we doubt whether this would make any great difference. In K.V.R. Rm.

Vr. Ramanathan Chettiar (dead) and Others Vs. A. Venkatachellam Chettiar (dead) and Others, , the decree amount was Rs. 36,000 and a pre-

decree arrangement was alleged by which only Rs. 33,750 was to be recovered from defendants 2 and 3 and there was to be no recovery from

defendants 1 and 4. The Court thought that the case resembled Arumugam Pillai v. Krishnaswami Naidu ILR (1920) M. 725 : 39 M.L.J. 222 and

not Chidambaram Chettiar v. Krishna Vathiyar ILR (1916) M. 233 : 32 M.L.J. 13. They followed the decision in Arumugam Pillai v.

Krishnaswami Naidu ILR (1920) M. 725 : 39 M.L.J. 222 and held that this agreement could not be gone into in execution.

Finally, the recent case of Mulla Ramzam v. Maung Po Kaing ILR (1926) Rang. 118 is very similar to the present case, and the authorities of

Calcutta, Bombay and Madras have been considered. In that case, in execution proceedings it was pleaded by the judgment-debtor that prior to

the passing of the decree he had entered into an agreement with the decree-holder, whereby in consideration of his confessing judgment for the full

decretal amount of Rs. 2,000 the decree-holder agreed to accept Rs. 1,000 only and that accordingly the decree could be executed to that extent

only; and it was held that: a decree which on the face of it is enforceable to the fullest extent cannot in execution proceedings he challenged as

being inexecutable, wholly or in part, on account of an agreement between the parties entered into prior to the decree, and that Section 47 of the

CPC had no application in that case. The learned Judge says:

Putting the most liberal construction on the words (of Section 47), I fail to see how a question like the one involved in the present case can be said

to relate ''to the execution or executability of the decree''. The words ''the decree'' refer to the decree passed by the Court and of which the

decree-bolder is seeking execution. It is only questions relating to the execution or executability of this decree, which the executing Court is

directed to determine. When a judgment-debtor sets up an agreement of this kind, that, prior to the decree, there was an arrangement between the

parties that though the decree was to be passed for Rs. 2,000 it should only be executed to the extent of Rs. 1,000 and not for the whole, be is not

seeking the aid of the Court to determine any question relating to the execution of the decree as passed by the Court, but is asking the Court to

embark on an enquiry whether the decree to be executed is the decree as passed by the Court or as agreed upon by the parties. Without going to

the extent of saying, as Mr. Justice Spencer of the Madras High Court does in one of the cases reported in the unauthorised reports Mallayya v.

China Kotayya (1921) 14 L.W. 317, that parties, who collusively allow a Court to pass a decree having privately agreed that the decree should

not be enforced, are committing a fraud on the Court, I can at least say that parties who, having agreed that a decree should not be executable

wholly or in part, pray the Court to pass an unconditional decree, are thereby inviting the Court merely to take part in a solemn farce.

In Benode Lal Pakrashi v. Brajendra Kumar Saha ILR (1902) C. 810 it was laid down that payment during the suit must be set up in the suit

itself and this part of the judgment has not been dissented from in any of the Madras decisions.

On a review of the authorities it appears to us that the Full Bench case, Chidambaram Chettiar v. Krishna Vathiyar ILR (1916) M. 233 : 32

M.L.J. 13, only covers agreements which relate to execution and not to agreements which attack the decree itself. There may be, as noted above,

certain pre-decree arrangements which, though in form they relate to execution, do in substance modify or totally nullify the decree; and in regard

to these cases we find different decisions owing probably to the angle from which the matter is regarded. But the only case quoted to us in which

the agreement directly alters the decree by something which does not relate to execution at all but means that the decree shall be executed for a

sum different from what has been stated in the decree is Pedda Veeranna v. Gondimalla Veer anna (1916) 5 L.W. 718, and the effect of this

decision is discounted by the subsequent remarks of Seshagiri Aiyar, J., in Arumugam Pillai v. Krishaswami Naidu ILR (1920) M. 725 : 39 M.L.J.

In all other cases of both this and other Courts, it seems to be quite clear that an agreement which does not relate to execution but directly

attacks the decree itself cannot be pleaded in execution. We do not think it is necessary to express any opinion as to whether the defendants can

file a separate suit on the basis of the alleged agreement. Nor do we wish to go into the question of res judicata in which connection (1889) ILR 16

682 (Privy Council) has been quoted, for there is a difference between decrees passed on contest and those which are passed on compromise

between the parties--Raja Kumara Venkata Perumal Raja Bahadur v. Thatha Ramaswamy Chetty ILR (1911) M. 75 : 21 M.L.J. 709. We think it

would be most dangerous to allow a decree itself to be attacked in execution. In our opinion, the decision of the learned District Judge is correct

and these appeals must be dismissed with costs.

A revision petition has been put in against an order refusing to amend the decree. For the reasons stated above, it is clear that the decree

cannot be amended. Apart from this, only the attaching parties in one appeal suit are parties to this application, and, in any case, once third parties

intervene, an amendment should not be allowed so as to affect such third parties--Hatton v. Harris (1892) A.C. 547.

The petition is dismissed with costs.

One set of costs in C.M.A. No. 253; one set of costs in C.M.A. Nos. 264, 265 and 266.

Costs in the Civil Miscellaneous Appeals to be proportionate to the amounts claimed in execution by the various decree-holders.