Sambasiva Aiyar vs Thirumalairamanujathathachariar and Others

This appeal arises in execution of a mortgage decree for sale for Rs. 1,800 and odd obtained by the plaintiff-appellant against the defendants-

respondents. The 3rd defendant one of the respondents pleaded that the decree had ceased to be executable by reason of an oral agreement

between him and the plaintiff, the conditions . of which on his part he had performed. The District Munsif disallowed his plea as not properly

pleadable in execution and took no evidence as to the existence of the agreement which was denied by the other side or of its terms or of its

alleged performance by him. The District Judge reserved that decision and remanded the case for disposal on the merits. The Appeal to us is

against his decision.

The question to be considered is whether the defendant is barred from setting up his plea in execution; and it has to be decided on the

allegations made by him as no evidence has yet been taken, He alleges in his counter-petition that at the request of the plaintiff he agreed to settle

the family disputes of one Murugathammal, a friend of the plaintiffs, and to induce her creditors, as she was in financial difficulties, to forego

portions of their claims, that in consideration of his trouble he was to be allowed to treat the suit claim as fully satisfied on payment of Rs.. 550 to

her creditors and that in the meanwhile plaintiff was to get a decree as sued for as a guarantee for defendant''s due performance of his part of the

contract but the decree was not to be executed if defendant did perform his part. He states that he did all that was necessary and paid Rs. 550 to

4 creditors of Murugathammal.

The agreement is said to have been entered into just before the preliminary decree was passed. The 3rd defendant tried to plead it in answer

when the application for the final decree was made but his objection was overruled on the ground that under Order 34 Rule 5 of the CPC only

payments made directly into Court could be considered. The High Court however then observed that his right if any would only be to plead the

agreement in execution. That, of course, was not a decision that he could do so; that question we have now to decide.

The main objection raised by the learned Advocate-General for the appellant is based on Order 21 Rule 2 of the Code of Civil Procedure. He

contends that if the payments alleged are true there was an adjustment of the decree within the meaning of that rule when they were made; and as it

was not certified to the Court it could not be pleaded in bar of execution. On the other side it is contended that we have here a case of an

agreement prior to decree falling within the scope of the Full Bench ruling in Chidambaram Chettiar v. Krishna Vathiyar ILR (1916) Mad. 233 and

therefore it is pleadable in execution and Order 21 Rule 2 is no bar to it.

We may say that the Advocate-General urged that this Full Bench ruling itself required reconsideration and that we should in any case confine it

to the facts of the case, before the Full Bench, which he says was one of an agreement for a temporary stay of execution. As the majority of the

Judges approved of and followed the previous decisions of our High Court which were not cases of temporary stay and also the decisions in Lal

Das v. Kishen Das ILR (1896) Bom. 463 and Gouri Singh v. Gajadhar Das (1909) 6 A.L.J. 403 and refused to follow the Calcutta view, we will

not be justified in cutting down the effect of the Full Bench in the manner suggested. We think the Full Bench decided that any pre-decree

agreement between parties to a suit by the terms of which the passing of the decree is not to be objected to but the execution is to be stayed in

whole or in part either temporarily or for all time can be pleaded and given effect to in execution proceedings and Order 21, Rule 2 is no bar to it.

Though the arguments of the Advocate-General against the view of the Full Bench, and in favour of the Calcutta view to the contrary as stated in

Benode Lal Pakrashe v. Brajendra Kumar Saha ILR (1902) Cal. 810 and Hassan Ali v. Gauzi Ali Mir ILR (1903) Cal. 179 are not without force,

we consider we are bound by that ruling. It is eminently desirable that on a question of procedure there should be certainty and finality.

The question then is whether the present case is one falling within the scope of the Full Bench ruling as we understand it. It will be noticed from

the terms of the agreement in that case as set out in the judgment of Phillips, J., that it was one of the terms that the decree was not to be executed

for a certain time, so that the agreement by itself was an answer to execution. In the present case however it is conceded that the agreement by

itself was no answer to the execution of the decree; for it to become a proper answer it was absolutely necessary that defendant should perform his

part of the contract and make the necessary payments. Whether we view the payments as performance by a party to a reciprocal contract u/s 54

of the Contract Act as urged by the learned vakil for the respondent, or as the performance of a condition precedent for the agreement not to

execute to come into force, it is clear the payments were necessary to enable the defendant to object to execution. The adjustment of the suit claim

was only complete on the day the last of these payments was made. On the allegations of the defendant there can be no doubt that his plea is that

the suit claim was completely satisfied or "" adjusted in whole "" when he made the payments.

Though the agreement was entered into before the preliminary decree was passed the payments alleged are stated to have been made after it

but before the final decree was passed. In the Full Bench case the adjustment by agreement was wholly prior to the decree but here we have a

case of an adjustment subsequent to the preliminary decree but prior to the final decree. The two cases are therefore distinguishable. But it has

been strenuously argued by the learned vakil for the respondent that as the adjustment was prior to the final decree which was the only executable

decree in the case and as according to him Rule 2 refers only to executable decrees we should hold that that rule did not apply to the present case

following the reasoning of the Full Bench on the point.

The answer to the above contention depends on the view we take of the scope of Rule 2 as to whether it covers a payment under, or

adjustment of, a preliminary mortgage decree in a suit for sale. The learned Advocate-General has drawn our attention to the ruling in Piran Bibi v.

Jitendriya (1917) 25 Cal. L.J. 553. It was decided there that a payment made out of court to the mortgagee after the passing of the preliminary

decree and before the final decree fell within the rule. The respondent''s vakil argues that we should not follow this ruling because there is a

difference of opinion between the Calcutta High Court and ours as to whether a pre-decree agreement can be pleaded in execution. That

difference however has nothing to do with the applicability or otherwise of Rule 2 and we cannot therefore uphold his contention.

This ruling was recently followed by a Bench of this Court in Singa Raja and Others Vs. Pethu Raja and Others, where the learned Judges say

it may be that if between the passing of the preliminary decree and the passing of the decree for sale defendant obtains a certificate under the

provisions of Order 21 Rule 2 he can take advantage of that to reduce the amount for which the property is to be sold."" No doubt this is not a

decided expression of opinion that Rule 2 applies but it shows their inclination on the question. As we are also inclined to take the same view that

such an adjustment or payment falls within the rule we are prepared to follow the above rulings.

So far as the reason of Rule 2 is concerned we can see no difference between a payment after the preliminary decree and one after the final

decree. The preliminary decree settles once for all the amount to be paid just as the decree in an ordinary money suit does. The payment or

adjustment may therefore be rightly treated as made after the decree in the suit. The words of the rule are, we think, wide enough to cover such

payments or adjustments. The learned vakil for the respondent insisted strongly on these words of the rule viz, ""the Court whose duty it is to

execute the decree'''' as showing that the rule referred only to executable decrees. But these words are used only to indicate the Court to which

certification is to be made. In the case of a preliminary decree such as the one we have here the Court which has to receive the money payable

under it is clearly the Court indicated. We do not think an inference adverse to our view as to the scope of the rule can properly be drawn from

these words.

We must therefore hold that the adjustment pleaded in this case falls within Order 21 Rule 2 and that the Full Bench case is distinguishable and

that as admittedly it had not been certified to the Court as required by that rule it cannot be pleaded in bar to execution.

The order of the District Judge must therefore be reversed and that of the Munsif restored with costs here and in the Lower Appellate Court.