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Judgment
Patanjali Sastri, J.—This is a petition to revise the order of the District Court of Kurnool scaling down the amount due to the respondent
under a compromise decree passed on 31st August, 1936, in O.S. No. 14 of 1936 on the file of the Subordinate Judge''s Court, Kurnool. The
compromise decree, so far as it is material here, runs as follows:
In full satisfaction of the suit claim and costs, besides the sum of Rs. 1,000 received by the plaintiff''s next friend on 22nd August, 1936, the
defendant has to pay Rs. 2,100.... Each party shall bear the costs incurred by him.
It was admitted that the principal sum originally advanced was Rs. 2,800, and the lower Court, applying Section 8 of the Madras Agriculturists''
Relief Act, deducted the amount paid by the petitioner Rs. 3,980-8-0 from twice the principal amount and found that the balance payable on the
Mate of the decree was Rs. 1,619-8-0. So far there is no dispute between the parties. The learned Judge, however, proceeded to apply the
proviso to Section 19 to a payment of Rs. 140 made after the decree was passed and for this purpose taxed the respondent''s costs of the suit at
Rs. 347-3-0, and deducting Rs. 140 held that the balance Rs. 207-3-0 was also payable by the petitioner in addition to Rs. 1,619-8-0 with
interest on the latter sum at the statutory rate. The learned Judge observed:
Since the decree passed was a compromise decree and the terms of the compromise were ''in full satisfaction of the suit claim and costs,'' when the
decree is reopened, naturally the defendant cannot have the best of both the worlds and claim reduction under the Act by reopening and amending
the decree and also state that the provision of the Act that all costs lawfully expended by the decree-holder should be reimbursed to him should not
come into operation.
The petitioner contends that this view of the learned District Judge is erroneous, and I am inclined to agree with him. Having regard to the
definition of ''debt'' in Section 3(iii) which expressly includes sums payable under a decree, it is clear that all amounts payable under decrees are
also liable to be scaled down under the provisions of the Act. Section 11, however, excepts any sum decreed as costs by any Court'' and Section
19 which provides the machinery for the scaling down of decree debts gives effect to this exception by providing that all payments made or
amounts recovered in respect of a decree should first be applied in payment of ''all costs originally decreed to the creditor.'' Reading these
provisions together as they should be, it is clear to my mind that they are applicable only to cases where any specific sum is decreed as costs by
the Court. It follows therefore that where parties enter into a compromise agreeing that a certain sum should be payable in full satisfaction of the
suit claim and costs without allocating any part of that sum specifically to the costs of the suit, the provisions of Sections 11 and 19 cannot be
invoked by the creditor. The Court has no power in a case of that kind to reopen the compromise, tax the costs, that would have been awarded if
the suit had succeeded after cqutest and direct its payment, when the judgment-debtor applies for scaling down the decree debt u/s 19 of the Act.
When a suit is compromised by the parties agreeing to pay and receive a gross sum without any allocation, they do not ordinarily contemplate any
specific sum as being payable by the one side or the other towards the costs of the proceedings; and it is beyond the province of the Court to
allocate any portion of the consolidated amount agreed to be paid to such costs or impose any fresh liability for costs as a condition of scaling
down the debt. In the present case, though the compromise referred to the defendant''s liability to pay Rs. 2,100 in full satisfaction of the suit claim
and costs, in another place, it provided that each party shall bear the costs incurred by him. This shows, what is usually the case, that the parties
had no definite idea in their mind that any part of that sum represented the liability for costs.
For these reasons, I hold that the view taken by the learned District Judge is wrong and the sum of Rs. 140 paid after the decree should go in
reduction of the total sum payable under the compromise decree. With this modification, the order of the learned District Judge is confirmed.
As the petitioner also raised another point which was not however seriously pressed, I direct each party to bear his own costs of this revision
petition.