Melarkode Bank Ltd. and Others vs Damodaraswami Naidu and Another

Mack, J.—The petitioners are decree-holders in the Sub-Court, Coimbatore. These petitions raise an interesting point of rateable

distribution. There were five decrees against the same judgment-debtor, two obtained in the Tiruppur District Munsif''s Court and three in the Sub-

Court, The decree-holder in the Tiruppur District Munsif''s Court in O. S. No. 494 of 1944, who is respondent 2, first got some immovable

property sold and Rs. 4915 which was realised was brought into the District Munsif''s Court. The other decree-holder in the District Munsif''s

Court got his decree in O. S. No. 65 of 1945 transferred to the Sub-Court for execution, for what reason it is neither disclosed nor material, and

attached the same immovable property--it was then disclosed that it had already been sold by the District Munsif. The Sub-Court acting u/s 63,

Civil P. C., sent for the amount which was received by it on 7th September 1946. Prior to the receipt of this money in the Sub-Court, the three

decree-holders there filed execution petitions. The learned Subordinate Judge held that they are not entitled to rateable distribution on the ground

that they did not file their execution petitions prior to the receipt of the sale proceeds in the District Munsif''s Court. The Sub-Court decree-holders

now seek in revision to revise this order and to establish their claims to rateable distribution. These petitions resolve themselves, therefore, into a

contest between three Sub-Court decree-holders who have been deprived of rateable distribution and two decree-holders in the District Munsif''s

Court who have been held entitled to rateable distribution.

Section 73(1) in this matter appears to me to be perfectly clear. It reads :

Where assets are held by a Court and more persons than one have, before the receipt of such assets, made application to the Court for the

execution of decrees for the payment of money passed against the same judgment-debtor and have not obtained satisfaction thereof, the assets,

after deducting the costs of realisation, shall be rateably distributed among all such persons.

The first point to be decided is, what is the Court holding the assets? There can be no doubt that it is the Sub-Court which as the Court of highest

grade u/s 63(1) has cast upon it the responsibility of deciding all claims and effecting rateable distribution. The next simple point to be determined in

this section is, when the assets were received by the Sub-Court. On this point also, there is no doubt and no dispute. The money was received in

the Sub-Court on 7th September 1946. It then follows on a simple reading of Section 73(1) that any decree-holder who had made an application

to the Sub-Court before this date is entitled to rateable distribution. The learned Subordinate Judge was guided or rather misguided himself by a

decision of Madhavan Nair J. reported in Thanmull Sowcar and Another Vs. K. Krishnaswami Reddiar, and, in my view, wrongly applied a

proposition he enunciated in a case in which the factual background was completely different. That was a case in which the District Munsif''s Court

attached and sold some property and in which a creditor in the Sub-Court also attached the same property. When the Subordinate Judge called

upon the District Munsif to send up the sale proceeds, the latter was unable to do so as he had permitted the decree-holder to enter a set off. The

result was that the Sub-Court decree-holder had to file a suit u/s 73(2), Civil P. C., and the judgments of the two lower Courts giving him a decree

were substantially confirmed by Madhavan Nair J. in second appeal. In the course of his judgment he set out certain conclusions and referred to a

category of cases under Seciton 63, Civil P. C., in which the receipt of assets by one of the Courts contemplated in that section amounted to a

constructive receipt of assets by each of such Courts. That decision had as its objective a liberal one, namely, the extension of the right to rateable

distribution to a decree, holder who had been deprived of it in somewhat unusual circumstances. I have carefully perused that decision and can find

in it no support for the view taken by the learned Subordinate Judge that it was binding on him in his decision on these rateable distribution

applications.

A perfectly clear decision of a Bench of the Bombay High Court reported in Godavaribai Govindrao Saswadkar Vs. Deekappa Mallappa, was

placed before me in which Shaw and Fawcett JJ. held that where in pursuance of an order passed by a superior Court, assets realised in execution

of a decree of a Subordinate Court are transferred to the superior Court, the assets are deemed to be received within Section 73 by the transferee

Court when they are actually received by that Court. I am wholly unable to see anything in this Bench decision which is really in conflict with the

reasoning of Madhavan Nair J. in Thanmull Sowcar and Another Vs. K. Krishnaswami Reddiar, . It is really not necessary to go beyond the very

simple language of Section 73 for a determination of the rights of these decree-holders to rateable distribution, Mr. V. Eamaswami Aiyar argued

that Section 73 read with Section 63 contemplated only one receipt of assets into Court and that in the present case the criterion date must be the

date on which the sale proceeds were received by the District Munsif''s Court. To adopt this view would be to do considerable violence to the

simple language of Section 73(1) which, as I have indicated supra, appears to permit of no doubt.

A final argument has been advanced that these petitions do not lie as petitioners have their right of suit. The learned Subordinate Judge however

appears to have committed an obvious error of law in misapplying a decision. There appears to be no necessity to drive these decree-holders

entitled to rateable distribution to a suit in the circumstances. I consider that these revision petitions are sustainable. They are allowed and the

petitioners will be admitted to rateable distribution.

The learned advocate says that the third Sub-Court decree-holder has also filed a revision petition (G. R. P. No. 254 of 1947) which is still

pending service of notice after several infructuous attempts, on respondent 2 for whom Mr. Chandra Reddi appeared in these two revision

petitions. It is unfortunate that he did not bring this to my notice while Mr. Chandra Reddi was in Court and did so, after he had completed his

argument and left the Court, and after I had dictated this judgment. There is obviously no necessity for any further notice to be issued to

respondent 2 on that petition to revise this identical order, respondent 2 having made an appearance on these two petitions and his case having

been exhaustively argued by Mr. Chandra Reddi on his behalf and by Mr. Ramaswami Aiyar for respondent 1 who, I understand, has been served

on this third petition. This order will, therefore, be a common order in the three petitions and the petitioner in C. R. P. No. 254 of 1947 will also be

admitted to rateable distribution. Petitioners will receive their costs with one advocate''s fee.