Nagor Damodar Shanbhogue (died) and Others vs Gange and Others

Venkataramana Rao, J.—This is an appeal from the order of the learned Subordinate Judge of South Kanara ordering the arrest of the

appellant in execution of the decree for costs in favour of the respondents in Appeal No. 223 of 1926 on the file of the High Court on appeal from

the decree in O.S. No. 8 of 1924 on the file of the Subordinate Judge of South Kanara. The said suit O.S. No. 8 of 1924 was filed by the

appellant to recover a sum of money due in respect of a usufructuary mortgage executed by the defendants and also for arrears of rent in respect

of certain leases executed by some of the defendants relating to the mortgaged property. The Subordinate Judge dismissed the plaintiff''s suit on the

ground that the appellant was not entitled to bring the property to sale as there was no personal covenant to pay. On appeal the learned Judges

held that so far as the mortgage is concerned, there was no personal covenant which would entitle the appellant to the relief of selling the

mortgaged property, but in regard to arrears of rent, as the mortgage property had been made a security for the arrears of rent, there was no bar

to the enforcement of the charge by asking for the sale of the properties. Accordingly they passed a preliminary decree for sale for the amount

claimed in respect of the arrears of rent. The relief that was ultimately awarded by the judgment of the High Court ran thus:

In the result, the appeal is partly allowed and a decree is given in plaintiff''s favour for a sum of Rs. 11,425-7-0 (on account of the arrears of rent

claimed in Schedule B) with subsequent interest thereon at 6 per cent, per annum from the date of suit till the date fixed for payment and also

proportionate costs in both the Courts, and thereafter with interest at six per cent, per annum on the aggregate amount. Time for payment is four

months from this date. In case of default in payment, the mortgaged properties will be sold, subject to the usufructuary mortgage lien of the plaintiff

under Ex. A. Liberty is reserved to him to bring a portion only of the mortgaged properties to sale for the realisation of this decree amount, free

from such, usufructuary mortgage lien. The respondents'' costs in both the Courts, proportionate on the value of the claim disallowed, should be

paid by the plaintiff. Nagar Damodara Shanbhogue Vs. Chandappu Pujary and Others, .

Thus both the plaintiff and the defendants (respondent in the present appeal) were awarded proportionate costs. On a reference to the decree it

will be seen that these costs were separately taxed. The ultimate decree that was drafted in pursuance of the judgment declared that the amount of

principal, interest and proportionate costs in both the Courts calculated up to the 6th July, 1933, was Rs. 19,450-10-3 and in default of payment

of the amount on or before the 6th of July, 1933, the properties were directed to be sold. So far as the costs awarded in favour of the respondents

were concerned, the decree ran thus:

And this Court doth further order and decree that the appellant (plaintiff) do pay to the respondents 15, 17 to 24, 26 to 28 and 30 (defendants 16,

18 to 25, 27 to 29 and 31) Rs. 539-12-2 for their proportionate costs in opposing this appeal and also their proportionate costs in the lower

Court, which will be taxed and ascertained by that Court on the amount disallowed.

The net result is that under the same decree both the plaintiff and the defendants were entitled to recover sums of money from each other. The

respondents in whose favour costs were awarded against the plaintiff-appellant sought to execute the same by applying for the arrest of the

plaintiff. The plaintiff opposed the application on the ground that the defendants were not entitled to execute the decree as the amount decreed in

his favour was far in excess of the amount awarded in favour of the respondents and therefore by virtue of Order 21, Rule 19, they were not

entitled to the relief they sought. This contention was overruled by the learned Subordinate Judge on the ground that there was no personal decree

against the defendants but only a decree against the property. He therefore ordered the issue of a warrant of arrest. It is against this decision that

this appeal has been preferred.

The main question therefore is whether Order 21, Rule 19 is applicable to the case. The relevant provision so far as is material runs thus:

Where application is made to a Court for the execution of a decree under which two parties are entitled to recover sums of money from each

other, then, if the two sums are unequal, execution may be taken out only by the party entitled to the larger sum and for so much only as remains

after deducting the smaller sum, and satisfaction for the smaller sum, shall be entered upon the decree.

According to the plain language of the section, the contention of the plaintiff seems to be correct. The corresponding provision of the CPC of

1882 ran thus:

When two parties are entitled under the same decree to recover from each other sums of different amounts, the party entitled to the smaller sum

shall not take out execution against the other party; but satisfaction for the smaller sum shall be entered on the decree.

This section was the subject of judicial interpretation and it was almost uniform in holding that the remedy of each party against the other need

not be precisely of the same nature. In. Bhagwan Singh v. Ratan I.L.R.(1894) 16 All. 395 there was a decree for redemption in favour of the

plaintiff the mortgagor on payment into Court of a certain sum of money as and for amount clue under the mortgage and also for costs of the suit,

upon a dale fixed by the decree. The mortgage money including interest and costs amounted to Rs. 1,004-7-0, the costs awarded being Rs. 31-1-

The plaintiff-mortgagor was also awarded a sum of Rs. 6 10-0 for costs against the mortgagee-defendant. The question was whether the

plaintiff was entitled to deduct the costs of Rs. 6-10-0 from the amount which he was bound to deposit under the decree as a condition of

redemption. Held he could. The learned Judges Sir John Edge, C.J. and Bannerji, J., dissented from the decision in Kalka Prasad v. Ram Dini

I.L.R.(1883) 5 All. 272 and observed thus:

There is nothing in that section which limits its application to a case in which the remedy of each party against the other is of precisely the same

nature. It appears to us that where one party is entitled to recover, for example, u/s 88 of Act No. IV of 1882, the amount of the mortgage debt

due by the other side by sale of the other side''s property and the other side is entitled to recover under the same decree costs against the plaintiff

personally, Section 247 applies, for the reason that there are two parties who are entitled under the same decree to recover from each other sums

of different or the same amounts; and that it makes no difference that one of those parties is obliged to recover from the other the money due by

executing a decree against the hypothecated property of the other, whilst his opponent is only entitled to recover the money decreed for costs

personally from the other side. The object of Section 247 is to prevent each side executing a decree in respect of amounts due, whether for costs

or otherwise, under the same decree.

This case was followed by our High Court in Sankara Menon v. Gopala Pattar ILR (1899) 223 Mad. 121 under precisely similar

circumstances. In that case there was a decree directing that on plaintiff paying into Court or to the defendants within three months the mortgage

money and the value of improvements, the defendants should surrender to the plaintiff the mortgaged property and if such payment was not made

the property should be sold. There was also a decree in favour of the defendants in and by which the defendants should pay to the plaintiff a

certain amount being the costs incurred by them in all the Courts. The plaintiff applied for recovery of the costs by arrest in the same way as the

defendants in this case have sought to arrest the plaintiff. The learned Subordinate Judge allowed the arrest holding that the words ""recover from

each other"" in Section 247 contemplated personal liability on the part of those parties to pay each other the sums decreed against each and that

they must hold the same character and possess identical rights of enforcing execution and that as the decree in favour of the defendants could only

be enforced by the sale of the property whereas the plaintiff would enforce the decree by arrest of the person, the provisions of Section 247 would

not be applicable. This contention was overruled and the plaintiff was held Snot entitled to the relief he sought on the ground that Section 247

would apply in spite of the fact that the remedies were not of the same nature. So far as we know, this decision has not been questioned in any

reported case before the enactment of the new Code. The legislature has re-enacted Section 247 in almost identical terms as Order 21, Rule 19. It

must be taken to have known the said interpretation and to have accepted it. As observed by Lord Justice James in Greaves v. Tofield (1880) 14

Ch. D. 563 :

If an Act of Parliament uses the same language which was used in a former Act of Parliament referring to the same subject, and passed with the

same purpose, and for the same object, the safe and well-known rule of construction is to assume that the legislature when using well-known

words upon which there have been well-known decisions uses those words in the sense which the decisions have attached to them. (Vide also

Mulla''s Civil Procedure Code, 10th Edition, page 727.)

The principle of Sankara Menon v. Gopala Pattar I.L.R.(1899) 23 Mad. 121 was applied even after the enactment of the new Code by our

High Court. In Chinnammal v. Chidambara Kothanar (1896) 71 M.L.J. 506 there was a decree for specific performance in and by which it was

decreed that on the plaintiff depositing into Court Rs. 500 within the time mentioned therein, the defendant was to execute and get registered a

deed of conveyance in plaintiff''s favour and the defendant was directed to pay the plaintiff a certain amount by way of costs. The plaintiff

deposited into Court a sum of money, that is, Rs. 500 less than the amount decreed in his favour. The question was whether the provisions of

Order 21, Rule 19 could be applied. The learned Judges (Venkatasubba Rao and Cornish, JJ.) held they could. It seems to us that the plain

language of the provisions of Order 21, Rule 19 would not warrant any other interpretation. All that the provision requires is that two parties must

be held entitled to recover sums of money from each other. A decree by A against B for a sum of money to be recoverable from his property is as

much a decree to recover the sum of money from B. The decree need not necessarily be a decree directing A to recover the sum of money from B

personally. The section does not say or provide in what manner the decree is to be executed. Even before the enactment of the new Code the

provisions of Order 21, Rule 19 were applied to the case of a decree for sale in enforcement of a mortgage or charge. Vide the observations of

the learned Judges in Bhagwan Singh v. Ratan I.L.R.(1894) 16 All. 395 already referred to. The provisions of Order 21, Rule 20, in the new

Code of 1908, give effect to this view. In view of the provision and in view of the recent decision of the Privy Council in Hazariram Marwari v. Rai

Bahadur Bansidhar Dhandania (1937) 1 M.L.J. 254 : L.R. 64 IndAp 67 : ILR 16 Pat. 127 (P.C.) where their Lordships observe that the words

of Rule 20, ""decree for sale in enforcement of a mortgage or charge"" cannot be restricted to personal judgments such as may be given under Order

34, Rule 6, the principle of Sankara Menon v. Gopala Pattar I.L.R.(1899) 23 Mad. 121 should govern the present case.

We therefore set aside the order of the learned Subordinate Judge and hold that the provisions of Order 21, Rule 19 are applicable to the case

and that the defendants (respondent) are not entitled to execute the decree for costs in their favour. It is not necessary to express any opinion,

having regard to the plain language of Order 21, Rule 20 as to how far the decision in Venkata Reddi Vs. T.V. Dorasami Pillai, is correct in that it

holds that a mortgage decree cannot be set off against a money decree in the absence of a personal liability on the part of the mortgagor who holds

the money decree. The respondents will pay the costs of the appellant in this appeal.