Bithko Traders and Another vs V.M. Traders

M.B. Shah, J.—Being aggrieved and dissatisfied by the judgment and order dated 30th December, 1983 passed below Ex. 1 in Darkhast

No. 942 of 1982 the petitioners (original judgment debtors) have filed this revision application.

The limited question involved in this revision application 18 whether the executing Court can permit the judgment-debtor to lead the evidence to

prove the alleged payment made towards the decretal amount which is not certified by the executing Court as required under Rule 2 of Order 21

of the Civil Procedure Code.

It is the case of the petitioners that as per the decree in Summary Suit No. 479 of 1981 the decree for an amount of Rs. l,40,000/-with 6 per

cent interest per annum thereon from the date of the decree till realisation was passed against the petitioners and it was agreed that the decretal

amount was to be paid by monthly instalments of Rs. 3500/-. The first instalment was to commence from 1st September, 1982. It is their say that

in pursuance of the agreement between the parties by way of full and final settlement of decree the petitioners paid Rs. 1,00,000/- in cash on 29-7-

1982 to the judgment creditor. For the receipt of the said amount it is alleged that the judgment creditor has given a writing on 29-7-1982. As

against this, it is the say of the judgment creditor that as the judgment debtor failed to pay the amount as per the decree, an execution application

was filed before the City Civil Court on 23-12-1982 which was numbered as Darkhast No. 942 of 1982. In the execution application the

petitioners raised the contention that the judgment debtors have paid Rs. 1,00,000/-towards the decretal amount and as per the receipt the entire

decree stands satisfied. The trial Court after considering the provisions of Rule 3 of Order 21 of the CPC arrived at the conclusion that the alleged

payment was not certified as provided under Rule 2 and hence there is no question of giving an opportunity of leading evidence to the petitioners to

prove their contention.

Mr. Shelat, learned Advocate appearing on behalf of the petitioners, submitted that after addition of Sub-rule (2A) in order 21 of the CPC if the

payment or adjustment is proved by documentary evidence, then the judgment-debtor is entitled to prove the said payment for adjustment of the

decree at the time of execution of the decree even though the said payment or adjustment is not certified or recorded by the Court executing the

decree. He further submitted that u/s 47 of the CPC if any such issue arises, the executing Court is required to determine it.

As against this, Mr. Desai, learned Advocate appearing on behalf of the opponent judgment creditor, submitted that the say of the petitioners

that they have paid Rs. 1,00,000/- in cash towards the decretal amount of Rs. 1,40,000/- is on the face of it a false plea because as per the decree

they have agreed to pay the decretal amount by monthly instalments of Rs. 3500/- and this plea is taken only to delay the execution proceedings.

He further submitted that the judgment debtor has not filed the application under Sub-rule (2A) of Rule 2 of Order 21 of the CPC and that the

executing Court has not recorded the adjustment or certified the said payment, therefore in the execution application it is not open to the petitioners

to raise such contention and that the trial Court has rightly rejected the application to the petitioners to permit them to lead evidence to prove the

said adjustment.

For appreciating these contentions it would be necessary to consider Rules 1 and 2 of Order 21 of the Civil Procedure Code. Rule 1 provides

the mode of payment under the decree. It provides that all money payable under a decree shall be paid by deposit in to Court whose duty it is to

execute the decree, or send to that Court by postal money order or through a bank or as directed by the Court which has passed the decree. For

this purpose if the payment is made as stated above, the judgment debtor is required to give notice thereof to the decree holder. Further, it can be

paid straightaway to decree-holder by postal money order or through a bank or any other mode wherein payment is evidenced in writing. When

payment is made outside the Court, then the procedure prescribed under Rule 2 is required to be followed. Rule 2 reads as under:

(1) Where any money payable under a decree of any kind is paid out of Court or a decree of any kind is otherwise adjusted in whole or in part

to the satisfaction of the decree-holder, the decree-holder shall certify such payment or adjustment to the Court whose duty it is to execute the

decree, and the Court shall record the same accordingly.

(2) The judgment-debtor or any person who has become surety for the judgment debtor also may inform the Court of such payment or

adjustment, and apply to the Court to issue a notice to the decree-holder to show cause, on a day to be fixed by the Court, why such payment or

adjustment should not be recorded as certified; and if, after service of such notice, the decree-holder fails to show cause why the payment or

adjustment should not be recorded as certified, the Court shall record the same accordingly.

(2A) No payment or adjustment shall be recorded at the instance of the judgment debtor unless

(a) the payment is made in the manner, provided in Rule 1; or

(b) the payment or adjustment is proved by documentary evidence: or

(c) the payment or adjustment is admitted by, or on behalf of the decree holder in his reply to the notice given under Sub-rule (2) of Rule 1, or

before the Court.

(3) payment or adjustment, which has not been certified or recorded as aforesaid, shall not be recognised by any Court executing the decree."" (1)

provides that the decree holder is required to certify such payment or adjustment and the Court is required to record the same accordingly. Sub-

rule (2) provides that the judgment-debtor shall inform the Court of such payment or adjustment and apply to the Court to issue notice to the

decree holder to show cause why such payment or adjustment should not be recorded as certified. After service of notice if the decree holder fails

to show cause why the payment or adjustment should not be recorded as certified, the Court shall record the same accordingly.

Sub-rule (2A) which is added in 1976 gives a mandate to the Court that no payment or adjustment shall be recorded at the instance of the

judgment-debtor unless the payment is made in the manner provided in Rule 1; or the payment or adjustment is provided by documentary

evidence; or the payment or adjustment is admitted by, or on behalf of, the decree holder in his reply to the notice given under Sub-rule (2) of Rule

1, or before the Court. This Sub-rule (2A) is added in view of the recommendation by the Law Commission wherein the Law Commission in its

Nth Report has observed as under:

In a large number of cases such pleas of payment or adjustment are not made bona fide and a good deal of the time of the executing Court is

wasted at the early stage in taking evidence and deciding such pleas which are ultimately rejected. In the words of the U. P. Judicial Reforms

Committee, ''The time has now come when Courts should insist on all payments to be made towards a decree by the well-recognized modes of

payments''.

The Law Commission in its 27th Report considered the matter in detail and observed:

...It is felt that the time has come to make the provisions of the law more stringent by recognizing only payments made in the manner suggested in

the Fourteenth Report or adjustments proved by documentary evidence. Even such payments and adjustments should, it is felt, be got recorded,

and further payments not recorded should continue to be unrecognised as at present. Broadly speaking, the effect of the proposed amendment will

be, (i) that oral payments and adjustments will have no claim for recognition in execution and will be incapable of being got recorded; (ii) payments

evidenced in writing or adjustments proved by documentary evidence, can be recognised but that too only if they are recorded. The condition of

recording is considered necessary even in the case of such payments etc. for the reason that otherwise there may be room for fraud and forgery"".

Therefore, this Sub-rule (2A) is added to make the provisions more stringent so that the fraudulent pleas of payment or adjustment outside the

Court are not taken at the time of executing the decree. Further, mandatory direction is given to the Court that payments evidenced in writing of

adjustment proved by documentary evidence can be recognised only if they are recorded i.e. the condition of recording by the executing Court is

considered necessary to avoid any fraud and forgery. No new right is created in favour of the judgment-debtor by the aforesaid Sub-rule (2A).

Therefore, there is no substance in the contention of the learned Advocate for the petitioners that after addition of Sub-rule (2A) if the payment or

adjustment is proved by documentary evidence, then the judgment-debtor is entitled to prove it even though it is not certified as provided in Rule

(2) at the time of execution of the decree. Further, Sub-rule (3) of Rule 2 in terms gives direction to the Court that a payment or adjustment which

has not been certified or recorded as provided in Sub-rule (2), shall not be recognised by any Court executing the decree. That is, a wholesome

Rule of evidence is incorporated under Sub-rule (3) which gives no option to the executing Court to discuss or record any evidence with regard to

the plea of the judgment-debtor that he has made payment towards the decretal amount outside the Court, if the said payment is not certified as

stated in Sub-rule (2). Under Article 125 of the Limitation Act, within a period of 30 days of the payment the judgment-debtor is required to file an

application for certification.

Further, addition of Sub-rule (2A) to Rule 2 in Order 21 does not make any difference in the position. The objects and reasons for insertion of

Sub-rule (3A) are to provide that any payment of money under a decree or adjustment of a decree shall not be recorded by the Court, unless it is

either made in accordance with Rule 1 or is proved by documentary evidence or is admitted by the decree-holder. Therefore, it cannot be said that

if the payment or adjustment is uncertified, yet for the payment if there is some documentary evidence with the judgment debtor, he can rely upon

and refer to it in an execution application. The addition of Sub-rule (2A) on the contrary restricts the jurisdiction of the executing Court to certify

the payment or adjustment. The payment or adjustment can be certified at the instance of the judgment debtor only if it is in the mode and the

manner provided in Clauses (a), (b) & (c) of Sub-rule (2A).

Mr. Shelat, learned Advocate for the petitioners, vehemently submitted that this would cause great prejudice to the illiterate or poor judgment-

debtors because due to illiter or poverty they may not take any legal advice and may pay the amount outside the Court to the judgment creditor. In

my view, this contention is devoid of any substance because since years this Rule is consistently followed and in some cases even if it works

harshly, yet there is no alternative. In Krishna Govind Patil Vs. Moolchand Keshavchand Gujar, , while dealing with Order 21 Rule 2 the Court

has observed that Sub-rule (2) enables the judgment-debtor to get payment or adjustment recorded, where the decree holder fails to do so. Sub-

rule (3) provides that a payment or adjustment, which has not been certified or recorded, shall not be recognised by any Court executing the

decree. The Court further held as under:

I apprehend that the rule has passed in the public interest. No doubt sometimes it operates harshly by preventing an honest debtor, who has paid

off his creditor, from proving the fact, but, on the other hand, it prevents false claims of payment having been made being presented to Courts in

execution. The Legislature having enacted that rule, it is the duty of Courts to give effect to it.

In the case of AIR 1929 19 (Privy Council) , the Privy Council has held that the provision in Rule 2(3) no doubt was inserted for good reasons

known to the legislature, and it is obvious that the provision must tend to simplify and expedite the proceedings in the Court executing the decree.

While considering the provision of Order 21, Rule 2(3) the Fall Bench of the Bombay High Court in the case of Mehbunissa v. Mahedunissa AIR

1925 Bombay 309, held that the words in Order 21, Rule 2(3), are too plain to admit of any other construction than that the Court executing a

decree is barred in limine from considering any allegation that a payment not certified has been made. The party alleging such a payment may have

a remedy, but not before the Court executing the decree. It is true that u/s 47 of the CPC the executing Court is required to decide all questions

arising between the parties to the suit in which a decree was passed, or their representatives and relating to the execution, discharge or satisfaction

of the decree and no separate suit is required to be filed for the decision on the said issue. But that does not many way affect the provision of

Order 21 Rule 2(3) which provides that the Court executing the decree shall not recognise a payment or adjustment which has not been certified

or recorded as provided in Order 21 Rule 2(1) & (2). That means the executing Court is debarred from deciding the contention of payment

towards the decree or adjustment of the decree if it is not certified or recorded as per the aforesaid sub-rule. If payment or adjustment is certified

as stated above and still if there is any dispute, then u/s 47 of the CPC the Court may decide it. But there is mandatory prohibition in Sub-rule (3)

of Rule 2 that uncertified payment or adjustment of decree shall not be recognised by the Court executing the decree. Hence even though the issue

is required to be decided u/s 47, yet it would not be open to the Court to permit the petitioners to lead evidence to prove that the amount is paid to

the opponent outside the Court. In the result, there is no substance 4n this revision application. Hence it is rejected. Rule discharged with costs.