Maganti Venkataswami Naidu vs Annapareddi Nagireddi alias Mutyalu Reddi

Wadsworth, J.—These three appeals are preferred by the decree-holder in a mortgage suit against the orders resulting from proceedings

after the decree. The suit was one of 1928. It was dismissed by the trial Court. The first appellate Court passed a decree in January 1934, for

payment of Rs. 3,031-7-0 as on 22nd April, 1934, the date fixed for redemption. A second appeal was filed to this Court. While that second

appeal was pending, the decree-holder took out execution. On 1st February, 1936, a portion of the hypotheca which belonged to the 8th

defendant who was not one of the mortgagors was sold for Rs. 1,785 to the decree-holder, who got delivery. On 4th January, 1937, there was a

further sale of items belonging to the mortgagors, defendants 1 to 3, for a sum of Rs. 855 in favour of the decree-holder who also got delivery. The

second appeal came up for hearing on 1st November, 1938. By this time Madras Act IV of 1938 had come into force, but the precise effect of its

terms was subject to a good deal of legal speculation and there was much uncertainty as to the procedure to be followed in obtaining relief with

reference to matters pending in appeal. On the day on which the second appeal came up for hearing, the 8th defendant filed C.M.P. No. 4,638 of

1938 claiming relief under the Act. It seems likely that the decree-holder asked for time to file a counter-affidavit. The hearing of the second appeal

was concluded on the 2nd of November and judgment was pronounced that day reducing the amount of interest so that the total decree was for

Rs. 2,335-10-0 as on the date fixed for redemption by the first appellate Court. To this decree would have to be added interest at 12 per cent, for

approximately 31 years. There is no reference in the judgment or the decree to the petition filed under Madras Act IV of 1938. Counter-affidavits

were in due course filed in this petition, which came up for hearing on 27th July 1939 and in a brief order it was remanded to the District Munsiff of

Tenali for disposal in accordance with the provisions of Act IV of 1938. In the District Munsiff''s Court there was an order scaling down the debt

to Rs. 637 which purported to be passed on consent. Against that order there was a review petition which was dismissed and against the dismissal

there was a revision petition which was allowed with the result that the review was allowed and the original petition was restored to file.

Meanwhile, the 8th defendant had been prosecuting an application for restitution as a result of the scaling down of the decree following the second

appellate decision. Originally both the sales were set aside and there was an appeal to the District Court in which the second sale in respect the

properties of the mortgagors was held to be unassailable, while the sale of the 8th defendant''s property was set aside. A second appeal was filed

in respect of this order which was reversed and remanded to the trial Court so that the question of restitution could be heard, along with the

question of the scaling down of the decree.

The result of all these proceedings is that the lower appellate Court has now restored the original order scaling down the decree to Rs. 637, has

directed the setting aside of the sale of the 8th defendant''s properties on payment of the amount of the decree as scaled down and has also

directed the ascertainment of mesne profits on the lands for the period during which they were in the possession of the decree-holder. Against

these orders, the present appeals are preferred. C.M.S.A. No. 79 of 1944 is against the order for restitution. C.M.S.A. No. 80 of 1944 is against

the order for mesne profits and C.M.S.A. No. 81 of 1944 is against the order scaling down the debt.

It will be convenient to deal with the last appeal first, in order that we may ascertain what is the amount which the decree-holder was entitled to

recover as a result of these proceedings. The Courts below appear to have taken the view that because this Court remanded the petition for

disposal by the trial Court there was no longer any question of the power of the trial Court to modify the decree in the light of the provisions of Act

IV of 1938. We cannot agree with this view. Though there was, for some time, considerable doubt as to the powers and procedure of an appellate

Court dealing with questions under Madras fax IV of 1938 raised, for tile first time at or shortly after the passing of judgment in appeal, those

doubts have been set at rest by the decision of the Full Bench in Velagala Sriramareddi and Others Vs. Karri Sriramareddi, being minor by

certificated guardian, Mr. G. Bhima Rao, . The Full Bench held that when judgment has been pronounced, the Court has no power to make any

order affecting the judgment which has been delivered, unless passed on an application for review; and in the case under consideration of the Full

Bench it was held to be illegal to have added to the judgment a provision for the determination of the relief which was due under Madras Act IV of

1938 and its subsequent incorporation in the decree. The Full Bench went on to consider the practice of dealing with an application for relief under

the Act made before the delivery of judgment by directing an enquiry and ordering in the judgment that the amount found due should be subject to

the finding as a result of that enquiry. This practice was held to be inexpedient, but was not declared to be illegal. It is, however, quite clear from

the judgment of the Full Bench that when once the appellate Court, after the passing of Act IV of 1938, has delivered judgment in a case in which

relief might have been granted, but has not been granted, in the judgment, it has no power at a subsequent stage to add anything by way of a rider

to its judgment which will confer a relief which should have been sought and obtained before the judgment was pronounced.

Having regard to this decision, it seems to us impossible to contend that merely because an application for relief was filed at the time of the

hearing of the appeal, the right of the party concerned to relief under the appellate judgment must be deemed to be in suspense and capable of

being subject to a further adjudication after the appellate Court has disposed of the appeal. Once it is granted that the Court which heard the

second appeal had no power, after it had delivered judgment, to modify that judgment by conferring upon one of the parties a relief under the Act

which was not obtained at the proper time, it follows clearly that the order of this Court remanding this petition to the trial Court for disposal,

would not give to the trial Court any power which it did not already possess to modify this Court''s decree. The decree in second appeal being final

any finding by the trial Court regarding the relief which might have been obtained had the proper procedure been taken, will not affect that decree.

It follows therefore that C.M.S.A. No. 81 of 1944 must be allowed with costs throughout and the application for relief under Act IV of 1938 will

be dismissed, with the result that the decree of this Court in second appeal awarding a sum of Rs. 2,335-10-0 with further interest will govern the

rights of the parties.

There remains the question of restitution. In view of our decision on the ""scaling down question, the modification of the decree as a result of the

second appeal is merely the reduction of the amount decreed by the lower Court from '' Rs. 3,031-7-0 to Rs. 2,335-10-0 with further interest at

12 per cent. The two sales together realised a sum of Rs. 2,640. The first sale was that in respect of which restitution is sought. It realised a sum of

Rs. 1,785. It is contended by Mr. Kotayya, on the authority of the decision in Syed Nathadu Sahib v. Nallu Muddy I.L.R.(1903)Mad. 98 that

whenever a decree is varied in appeal, a sale held under the trial Court''s decree has necessarily to be set aside if the purchaser is the decree-

holder. The decision on which reliance is placed is a decision passed u/s 583 of the old Code of Civil Procedure, the terms of which are entirely

different from those of Section 144 of the present Code of Civil Procedure. In Sundararama Reddi v. Raghava Reddi (1921) 42 M.L.J. 315 a

Bench of this Court had to consider a question similar to that which is now raised and it held that whatever be the merits of the decision in Syed

Nathadu Sahib v. Nallu Mudaly I.L.R.(1903)Mad. 98 with respect to the law as it then stood, that decision is not any authority for the

interpretation of the law as it now exists.Under Section 144 of the present Code the position is plain. It is only where and in so far as a decree is

varied or reversed that restitution can be made and the restitution to be made is that which will, so far as may be, place the parties in the position

which they would have occupied but for such decree or such part thereof as has been varied or reversed. The true criterion seems to be to

consider what would be the position had the appellate Court''s decree been passed by the Court of first instance. If the sale which has been held is

one which would have been held even if the Court of First Instance had decreed the amount eventually found due in appeal, there is no legal or

equitable reason for setting aside that sale on ordering restitution. On the facts of the present case, it is clear that at the time when the sale of the

8th defendant''s property was held the amount due to the decree-holder on the basis of the eventual decree passed in second appeal would have

been very much more than the amount for which the property was sold. It cannot therefore be said that the sale of the 8th defendant''s property

was the result of the error in the original Court''s decree. Even if we take the two sales together, it would appear that the total amount for which

both the properties were sold approximates very closely to the amount which had been ultimately found due. In such circumstances, there is no

case for restitution at all.

In the result, we allow C.M.S.A. Nos. 79 and 80 of 1944 with costs throughout--one advocate''s fee--and the restitution application will be

dismissed.