Brajamohan Mahapatra vs Ramendra Kumar Deb Mandal and Others

Shearer, J.—This second appeal arises out of a proceeding in execution of a rent decree. The decree was passed in 1931, and on a number of occasions subsequently execution was levied on it. In 1934, and again in 1935, certain movable property belonging to several of the judgment-debtors was attached. These attachments were made by a Chakla Kanungo, and, in each case, the Chakla Kanungo sold the property and made over the sale proceeds to the decree-holder. The question that arises in the appeal is a somewhat curious one, namely, whether in making the payments which he did to the decree-holder, the Chakla Kanungo was an agent authorised in that behalf by the judgment-debtors. The appeal, it should, be explained, came previously before a Divisional Bench which held that Section 20, Limitation Act, might apply to save limitation and remanded the case in order that it might be determined whether or not these payments did in, fact, come within the purview of that section. The contention put forward on behalf of the decree holder is, on the face of it, a somewhat startling one. Nevertheless, it has been accepted by the learned District Judge who relied on two decisions of the Madras High Court. In the earlier of these decisions Gobindasami Pillai v. Dasai Goundan AIR 1921 Mad. 704 much reliance was placed on the decision of the House of Lords in Chinnery v. Evans (1864) 11 H.L.C. 115. Referring to that decision Coutts-Trotter J. said that the principle to be deduced from it was this:

that if a debtor''s assets are so placed either by his own act or by operation of law, that, if some one other than he alone can release them for the purpose of making payments due from him, then the act of that other in operating upon the debtor''s assets must be treated as the act of the debtor himself, the volition of the debtor in such a case being neither requisite nor relevant.

The facts with which Coutts Trotter and Sadasiva Ayyar JJ. had to deal in that case were of a very extraordinary kind. It appears that after a final decree had been passed for the sale of certain mortgaged property, the property was acquired under the Land Acquisition Act and the compensation money was paid into Court, the Collector having presumably been informed that a final decree for the sale of the property had been passed. Eventually, the District Judge made an order directing that the money should be paid out to the mortgagee decree-holder.

It was contended that in making this payment the District Judge was acting as the authorised agent of the judgment-debtor, and that, in consequence, it availed to save limitation. The amount deposited in Court as compensation was, it should be explained, less than the amount due under the decree, and the decree-holder had levied execution for the balance. The other and later decision is that of a Judge sitting singly. In that case Venkatasubayya v. G. Seshayya AIR 1927 Mad. 80, the facts bore a resemblance, but only a superficial resemblance, to those with which the Court had to deal in the earlier case. A sum of money had been deposited to the credit of the father of the judgment-debtor in a suit in which he was the plaintiff and which was pending when the suit in which the decree was eventually passed was instituted. The money was attached before judgment, and after judgment was delivered and the suit was decreed it was paid out to the decree-holder. Jackson J., relying on the observations of Coutts-Trotter J., which I have already quoted, would apparently have been prepared to hold that, in making this payment, the Court was acting as the agent of the judgment-debtor if, the money had been deposited to the credit of the judgment debtor and not, as in fact it was, to the credit of the father of the judgment-debtor. Mr. S.P. Mahapatra, for the respondents, would extend the proposition laid down by Coutts-Trotter J. even further than Jackson J. was apparently prepared to extend it.

The learned advocate, as I understand him, argues with, it must be conceded, a certain amount of ingenuity, that if the Court acts as the agent of a judgment-debtor in paying over to the decree-holder money which has been paid into Court to the credit of the judgment-debtor and has been attached, it equally acts as his agent in paying out money which may not have been deposited in Court but which represents the sale proceeds of property which has been attached and which, but for the rules under which the Chakla Kanungo acted, would have been brought into Court and sold there. Wadia J. of the Bombay High Court in Currimbhai Abdulhusain Vs. Ahmedali Lukmanji, said that the proposition laid down by Coutts-Trotter J., was too broadly expressed. I took time yesterday to read the decision in Lords in Chinnery v. Evans (1864) 11 H.L.C. 115 and, after having read and considered it, I agree entirely with Wadia J. The question at issue in Lords in Chinnery v. Evans (1864) 11 H.L.C. 115 turned on the language used in an Irish Statute which authorised a Court of equity to appoint a receiver to receive

such parts of the rents of the mortgaged premises as shall be sufficient to pay such arrears of interest, and also the accruing interest of the said mortgage money from time to time, one half year when the other shall become due, until the whole of such interest due on the mortgage shall be discharged.

The Lord Chancellor at page 184 of the Report observed:

I think no reasonable doubt can be entertained, that under the statute the receiver in the receipt of the rents of the Limerick estate is, in point of fact as well as of law, the receiver of the mortgagor, the owner of the estate subject to the mortgage, and that any payment made by the receiver in pursuance of the order, is payment in law by the legal agent of the person liable to pay.

Lord Cranworth also dealt with the point very briefly merely observing:

It was argued that a payment to be brought within this statute must be a payment by the mortgagor, not by a receiver who is an officer of the Court. But for this argument there is no warrant. The statute says nothing as to the person by whom the payment is to be made.

I find it difficult to understand how Coutts-Trotter J. deduced from these very brief observations the broadly expressed general principle which he did. In my opinion, neither of the two decisions relied on by the District Judge, even assuming that they were correct, applies to the facts of this particular case. It must, of course, be conceded that the payments which the Chakla Kanungo made to the decree-holder operated as part payments of the decretal amount.

It is, however, perfectly clear that the Chakla Kanungo was not expressly authorised by the judgment-debtors to make them. Can it possibly be said that the Chakla Kanungo was impliedly authorised to make them by the judgment-debtors? The warrants issued to the Chakla Kanungo directed him to seize the movables of the judgment-debtors and hold them unless and until the amount outstanding under the decree was paid.

In seizing the movables the Chakla Kanungo was acting under the authority and as an agent of the Court and not at all as an agent of the judgment-debtors. That being so, it seems to me wholly absurd to suggest that, subsequently, in selling the movables which he had seized, and making over the sale proceeds to the decree-holder, he was acting with the implied authority of the judgment-debtors and as their agent.

In my opinion, the decision of the learned District Judge is erroneous. That being so, the order of the Court will be set aside and the appeal will be allowed with costs throughout. The hearing fee is assessed at two gold mohurs.