Radhakrishna Pai vs Kesava Pillai

P.K. Balasubramanyan, J.—In this revision, the judgment debtors challenge the order of the executing Court overruling their objection that they have already paid the amounts due under the decree to the original decree holders outside Court and therefore the attaching decree holder is not entitled to realise the amounts due under the decree. The executing Court found that the alleged payment not having been certified or recorded, under Order 21, Rule 2 of the Code of Civil Procedure, the attaching decree holder was entitled to proceed with the execution even assuming that the claim of the judgment debtors was true.

The main contention raised on behalf of the judgment debtors is that the attaching decree holder is not a decree holder as defined in the Code and consequently Order 21, Rule 2 cannot stand in the way of the judgment debtors pleadings and establishing that they have already paid off the original decree holder and consequently the attaching decree holder cannot proceed with the execution. Counsel for the attaching decree holder submits that an attaching decree holder or even an assignee decree holder executing the decree can raise the contention that unless recorded by Court under Order 21, Rule 2 of the Code of Civil Procedure, the plea that the decree has been satisfied cannot be raised. The executing Court after noticing Order 21, Rule 1(b) and Order 21, Rule 2 came to the conclusion that the judgment debtors are not entitled to prove a payment which is not recorded by the Court under Order 21, Rule 2(3) of the Code. The Court also found that under Article 125 of the Limitation Act time for making an application for recording a payment is 30 days. Here the alleged payment was five years prior to the present execution petition and hence such a payment could not be recognised even if the objection were to be treated as an application under Order 21 Rule 2 of the Code.

Strong reliance is placed by counsel for the judgment-debtor on the decision of the Allahabad High Court in Ram Prasad Vs. Rajjan and Another, (2) in support of his argument. Therein, the Allahabad High Court held that the definition of the term ''decree holder'' as given in Section 2(3) of the CPC does not include an attaching creditor of the decree holder and a payment to the attaching creditor of the decree holder is not payment to the decree holder within the meaning of Order 21 Rule 1 (b). That was a case where when the decree holder attempted to execute the decree, the judgment debtor set up a plea that he had paid off the amounts to the attaching creditor of the decree holder. The Court observed:

For payment to the decree holder out of Court, payment must be made to the holder of the decree in respect of which the payment has to be made. The definition of the term ''decree holder'' is given in Section 2(3) of the CPC and does not include an attaching creditor of the decree holder. The payment therefore to the attaching creditor of the decree holder is not a payment to the decree holder within the meaning of Rule 1(b) and Order 21. The last clause does not apply. The payment therefore, to the attaching creditor Ram Harakh and Rupkali was not such payment as could discharge Ram Pargash from the decree passed in favour of Ram Badan Singh.

Under Order 21, Rule 10 of the Code of Civil Procedure, the holder of a decree who desires to execute it shall apply to the Court which passed the decree or if it has been sent to another Court then to that Court. It is settled law that a certified decree holder, a person who appears in the decree as the holder of the decree, can execute the decree even if he had parted with the property which is the subject matter of the decree so long as a transfer is not recognised by the executing Court under Order 21, Rule 16 of the CPC or u/s 146 of the code. The Allahabad case therefore, when the decree holder who figured in the decree as the holder of the decree sought to execute the decree, the only manner in which the judgment debtor could resist the execution was by showing that the decree stood satisfied in terms of Order 21, Rule 2 read with Rule 1 of the Code. What the Allahabad High Court also said was that the plea that a payment was made to an attaching creditor of the decree holder could not be accepted to refuse execution of the decree when the execution is sought by the certified decree holder. In my view, the said decision does not lend support to the contention of the judgment debtors that in a case where an attaching decree holder seeks to execute the decree. Order 21, Rule 2 of the Code has no application. No doubt there is an observation in the decision of the Allahabad High Court that the definition of the term ''decree holder'' as given in Section 2(3) of the Code does not include an attaching creditor of the decree holder.

In Rama Subbaier v. Avadhanial 1951 KLT 185, a Division Bench of the Travancore-Cochin High Court held that a post decree arrangement or satisfaction of the decree with the original decree holder could be pleaded notwithstanding. That it is not certified under Order 21, Rule 2 of the CPC in a case where the agreement with the original decree holder or the satisfaction of the decree was before the assignment of the decree and the assignee decree holder applied under Order 21, Rule 14 of the Travancore Code for the recognition of the transfer of the decree long thereafter. Their Lordships have stated in overruling the contentions based on Order 21, Rule 2 of the code thus:

We are unable to agree with the contention. The agreement pleaded in the case was reached at a time when the decree had not been assigned and long before the assignee applied under Order 21 Rule 14 of the CPC for the recognition of the assignment in his favour. We think that agreement of the kind embodied in Ext. 1 though not certified under Rule 2 can be pleaded by the judgment debtor in bar of execution (vide Brajabashi Modak and Others Vs. Manik Chandra Modak, ).

The question in the decision of the Full Bench in Commissioner of Income Tax Vs. Mrs. J.V. Saldhana, , arose when, in opposition to an application by a transferee decree holder under Order XXI Rule 16 of the CPC the judgment debtor set up a case that the decree stood satisfied. The question arose whether such a plea of satisfaction by the judgment debtor in the absence of a certification under Order XXI Rule 2 of the CPC could be recognised. The Full Bench held that a judgment debtor was debarred under Order XXI Rule 2 of the code for failure to certify from-pleading adjustment of the decree. The Full Bench also held that where a decree has been satisfied if the decree holder does not certify such adjustment to the Court, the judgment debtor himself may apply to the Court to issue a notice to the decree holder to show cause why such an adjustment should not be recorded as certified. If the decree holder had not certified the adjustment and the judgment debtor had not got the adjustment recorded within the period prescribed by law, such an adjustment cannot be recognised by the Court executing the decree. There was a contrary view taken by the High Court of Bombay which was referred to in the decision of the Full Bench. The conflicts of views came to the notice of the Privy Council in AIR 1943 66 (Privy Council) . After quoting Order XXI Rule 2 of the Code their Lordships held:

Neither payment nor adjustment of any kind has been recorded in the present case. Can the Appellant be permitted to maintain that the assignment is invalid because the decree has been discharged by payment or by a new bargain? A Full Bench decision of the High Court at Madras has held that while in these circumstances it may be open to the judgment debtor to attack the transferee''s position by showing that he cannot legally possess that character, that he is a benamidar or for reasons of a similar nature, the judgment debtor cannot, when there has been no certified adjustment, maintain that there is no decree to be transferred.

After noticing the view taken by the High Court of Bombay in Raghunath Govind v. Gangaram Yesu ILR 47 Bom. 643, and the decision of the Allahabad High Court in Murari Lal v. Raghubir Saron ILR All 694, their Lordships stated that:

Their Lordships are of opinion that the Bombay decision is not sustainable. The rule says that "the transferee may apply for execution of the decree to the Court which passed it." On the face of the rule, the application to be made thereunder is an application for execution: that it is made to the Court which passed the decree does not tend to show the contrary. A consideration which strengthens the words just cited is that otherwise the decree holder, who certainly can take out execution himself, cannot assign this right to another. Their Lordships are in agreement with the view taken by the High Court of Madras in the Full Bench case and in the present case.

A Division Bench of the Travancore Cochin High Court in the decision in Raman Pillai v. Godavarma Valiya Raja 1952 KLT 478, observed that

In order that the executing Court may give effect to such an adjustment and satisfaction the same must have been certified by the decree holder or the judgment debtor must have applied to the executing Court within the period prescribed by law to have such adjustment and satisfaction recorded as certified.

On a careful consideration of the relevant aspects in the light of the decisions referred to above, I am of the view that an adjustment or payment not certified or recognised under Order XXI Rule 2 of the CPC cannot be set up by a judgment debtor. It is really an estoppel against the judgment debtor pleading an adjustment or satisfaction of the decree and it may not matter whether the decree is sought to be executed by the original decree holder, the assignee decree holder or the attaching creditor of the decree holder. With respect and especially in the light of the decision of the Privy Council referred to above, I am not in a position to agree with the observations contained in Rama Subbair v. Avadhanial 1951 KLT 185. I must notice that in the said decision neither the decision of the Madras High Court nor the decision of the Privy Council is referred to.

In view of my conclusion as above, I uphold the decision of the Court below which overruled the objections of the judgment debtor to the executability of the decree at the instance of the attaching creditor of the decree holder. Consequently, I confirm the order of the Court below and dismiss this revision. I make no order as to costs.