Sellamuthu Vannan vs Chinnanna Moopan

Ramamurti, J.—This revision petition which had been filed by the decree-bolder raises the question about the applicability of Order XXI,

Rule 2, Code of Civil Procedure. The decree-holder filed an application for execution by attachment and sale of the immovable properties of the

judgment-debtor, who filed a counter (objection statement) resisting the execution petition alleging that the decree amount had been paid in full on

19th December 1960, to the decree-holder, and that the latter had undertaken to report full satisfaction to the Court, and that therefore, this

execution petition should be dismissed. This objection statement was filed by the judgment-debtor on 5th March 1960, well within ninety days of

the alleged payment. The execution petition came up for enquiry on several dates and adjourned from time to time. At one of the hearings the

judgment-debtor produced a receipt passed by the decree-holder and some witnesses were also examined on 14th September 1960.

Subsequently on 30th October 1960, the decree-holder made an endorsement on the application that the execution petition was not pressed at

present and that the petition should be dismissed. The judgment-debtor objected to this course and insisted that the enquiry regarding the question

of discharge should be completed and a decision rendered thereon. It is at that stage that the decree-holder raised the objection that under Order

XXI, Rule 2 as the payment or adjustment had not been certified by an independent application filed for that purpose within ninety days, the

objection cannot be entertained.

The District Munsif took the view that he was bound by certain decisions of this Court which precluded him from entertaining the objection of

the judgment-debtor in an objection statement as an answer to an execution petition, there being no separate application by the judgment-debtor

for recording satisfaction under Order XXI, Rule 2, Code of Civil Procedure. On appeal, the District Judge came to a contrary conclusion. He

held that the Court had ample discretion to proceed with the enquiry and, therefore, he remanded the petition back to the trial Court for further

investigation and disposal on the merits. The decree-holder has preferred this civil revision petition.

Order XXI, Rule 2(1) provides the machinery for the decree-holder certifying the payment or adjustment for recording satisfaction of the

decree. Order XXI, Rules 2(2) and (3) which are relevant in the instant case run as follows:

(2) Any party to the suit or his legal representative or any person who has become surety for the decree-debt also may inform the Court of such

payment or adjustment and apply to the Court to issue a notice to the decree-holder to show cause, on a day to be fixed by the Court why such

payment or adjustment should not be recorded as certified; and if after service of such notice, the decree-holder fails to show cause why the

payment or adjustment should not be recorded as certified, the Court shall record the same accordingly.

(3) A payment or adjustment which has not been certified or recorded as aforesaid, shall not be recognised by any Court executing the decree.

It may be mentioned at the outset that this provision does not specify any particular form by which the judgment-debtor may inform, the Court

of the payment, and all that it requires is that the Court should be informed that the judgment-debtor claims that the decree has been satisfied by

payment and adjustment and that he should also apply to the Court to issue a notice to the decree-holder to show cause why such payment or

adjustment should not be recorded as certified. Even if a literal compliance of Order XXI Rule 2(2) is insisted upon, it only requires the judgment-

debtor to inform the Court of the payment or adjustment and apply to the Court to issue a notice to the decree-holder for enquiring into the matter

and for recording the payment as certified. This of course should be done within ninety days of the payment or adjustment. Looking at the language

of the provision here is no insuperable difficulty as to why an objection or a counter-statement filed by the judgment-debtor within ninety days

should not be regarded as a sufficient compliance of the procedural requirement. The requirement for applying to the Court to issue a notice to the

decree-holder is fully satisfied when the objection-statement is filed into Court and a copy of the same is also served upon the decree-holder. The

position becomes a fortiori when on the basis of the objection raised by the judgment-debtor relying upon a plea of payment the enquiry is

adjourned from time to time. The decree-holder is put upon notice of the objections raised by the judgment-debtor and under those circumstances,

it is a meaningless and utterly useless technicality still to insist that there should be a formal separate application by the judgment debtor, either for

recording satisfaction or a separate application to the Court to issue a notice to the decree-holder. As so often observed, rules of procedure are

designed to facilitate and advance justice and tended to be used not as a machinery for imposing penalties and punishments or for defeating justice.

Unless the language of the statutory provision is very clear, specific and mandatory in character, there is no reason why the Court should not

accept a substantial compliance with the provision, especially when such a course does not frustrate the object or the principle underlying such a

procedural provision. The purpose of Order XXI, Rule 2 is to eliminate as far as possible and shut out controversies and disputes when oho

decree is put in execution. For this purpose the law of procedure requires that the payment or adjustment could be brought to the notice of the

Court within ninety days of such payment or adjustment, so that the same can be investigated as expeditiously as possible. I do not see how a

substantial compliance with this provision instead of a rigid strict insistence upon the formalities would in any way defeat the purpose.

Learned Counsel for the Petitioner, relying upon some decisions of this Court, contended that according to those decisions an independent

separate application by the judgment-debtor would be necessary, and that a counter or an objection statement filed by him would not avail. On an

examination of those decisions, I am unable to agree with this contention. On the other hand, I am clearly of the opinion that the trend of the

decisions of this Court is clearly in favour of the view recognising ample discretion in the Court to accept the objection statement of the judgment-

debtor as an application for recording satisfaction. It is true that there is a divergence of opinion amongst various Courts on this aspect of the

matter, but the preponderance of the view is that the judgment-debtor''s objection statement, provided it is filed within ninety days, could well be

regarded as sufficient compliance.

In Budrudeen v. Gulam Moideen ILR (1911) Mad. an application for execution was filed by one of the decree-holders which was resisted by

the judgment-debtor on the ground that a sum of Rs. 3,400 was paid to the decree-holders in complete satisfaction of the decrees, that the balance

was remitted and that the decree-holders had agreed to certify complete satisfaction of the decree, and that the application for execution of the

decree was, therefore, a fraudulent one and should not be allowed by the Court. In that case the adjustment was alleged to have taken place in

1904 and the application for execution was filed in 1907. The Bench of this Court held that the prohibition against entertaining a plea of satisfaction

raised beyond ninety days, would apply, whether it is an application by the judgment-debtor to record satisfaction or an objection raised by him as

an answer to the execution petition. The request on behalf of the judgment-debtor to treat the objection statement as an application for recording

satisfaction was declined by the learned Judges on the ground that the same was put in beyond. 90 days. The learned Judges observed that they

would have been inclined to accede to the request of the judgment-debtor if the counter petition had been put in within the time allowed to the

judgment-debtor by the Limitation Act, i.e., 90 days. The way in which the learned Judges distinguished the earlier decision of this Court in

Ramayyar v. Ramayyar ILR (1897) Mad. 356 already shows that this decision, Badrudeen v. Gulam Moideen ILR (1911) Mad. 357 is clear

authority for the position that the objection statement would be sufficient compliance provided it had been filed within ninety days.

In Lodd Govindoss v. Ramdoss Vishnu Doss (1912) M.L.J. 88, 90 an application was filed under Order XXIII, CPC for recording a

compromise and it was held that Order XXIII, Code of Civil Procedure, would not apply to execution proceedings. When a similar request was

made to the learned Judges that the counter-affidavit of the judgment-debtors might be treated as an application by the judgment-debtor to record

satisfaction, the learned Judges while recognising discretionary power in the Court to adopt such a procedure, however, declined to grant the

indulgence on the facts of that case, even though the objection statement was filed within ninety days. The matter was put thus by the learned

Judges:

We are asked on behalf of the judgment-debtor to treat his affidavit as a substantive application under Order XXI, Rule 2 and we have been

referred to the case of Alathoor Badrudeen. v. Gulam Moideen ILR (1911) Mad. 357 wherein proceedings under the old Section 258 the Court

was asked to treat the counter-petition of a judgment-debtor as an application to compel the judgment creditors to certify the adjustment. The

learned Judges say ""We might be inclined to accede to this request if there was anything before us to show that the counter-petition was put in

within the time allowed to the judgment-debtors by the Limitation Act."" In the case before us the counter-affidavit was no doubt put in within the

time allowed by the Limitation Act; but we do not feel disposed to grant the indulgence to the judgment-debtor of treating his counter-affidavit as a

substantive application under Order XXI Rule 2(ii). The observations of the learned Judges in Badrudeen v. Gulam Moideen ILR (1911) Mad.

357 has reference to the facts of that particular case. To treat the affidavit as an application is to ignore the express language of Order XXI Rule

2(ii) which requires a notice to show cause against recording satisfaction of the decree. The judgment-debtor is still in time and can take action, if

he thinks fit.

From the above observations it will be clear that one particular reason why the request of the judgment-debtor was not granted was that the

judgment-debtor had still time to file a separate application. If the time had expired (if one can speculate) the attitude of the learned Judges might

have been different. This decision, therefore, does not run counter to Badrudeen v. Gulam Moideen ILR (1911) Mad. 357. But it affirms and

recognises the power of the Court to treat an objection statement as a separate application.

In Kandasami v. Narasimha ILR (1952) Mad. 531 the principle of the decision in Badrudeen v. Gulam Moideen (1911) ILR Mad. 357 was

applied. In that case in execution of the mortgage decree the property was sold and the 98th Defendant filed an application to set aside the sale on

the ground that the decree had been satisfied by payment. That application was filed within ninety days. Even though the judgment-debtor did not

file a separate application to record and certifiy the payment the Bench took the view, following Badrudeen v. Gulam Moideen (1911) ILR Mad.

357 that the application to set aside the sale inasmuch as it was based upon payment (the same having been filed within ninety days) could well be

treated as an application for recording satisfaction under Order XXI, Rule 2, Code of Civil Procedure. It is unnecessary to refer to decisions of the

other High Courts, and it is sufficient to refer to the Full Bench decision of the Andhra Pradesh High Court in Chengayya v. Chenga Reddy ILR

(1959) A.P. 499, 503 (F.B.). Chandra Reddy C.J., delivering the judgment of the Full Bench observed as follows:

Therefore, the two essential conditions of this order are that intimation should be given to the Court within the specified time and that the decree-

holder is given an opportunity to put his case before Court. We do not find anything in the language of that rule which prevents the information

envisaged in that rule being presented for applying to a Court to issue a notice to the decree-holder for the purpose set out in that rule. There is no

definition of ''application'' in the Code of Civil Procedure. ''Application'' as defined in Rule 3, Sub-rule 2 of the Civil Rules of Practice and Circular

Orders, Vol. I contemplates an oral application also.

Be that as it may, as we have already indicated, the intendment of that rule is that the decree-holder should have notice of the request of the

judgment-debtor to have the payments or adjustments recorded by the Court. Therefore, when a counter contains a plea of satisfaction or

adjustment of the decree and that is served on the decree-holder, who is thus afforded an opportunity to show cause against such certification,

there is substantial compliance with the terms of Order 21 Rule 2 Code of Civil Procedure. If those two essential elements are present, it could be

treated as a substantive application.

There is a useful discussion of the relevant cases and the principle underlying Order XXI, Rule 2. With respect I am of opinion that this

decision lays down the correct view.

In my opinion, the ratio of the cases decided under Sections 17 and 33 of the Indian Arbitration Act can well be applied to the instant case,

when the objection of the judgment-debtor has been entertained and the petition was adjourned from time to time for investigation and trial. It is

obvious that the judgment-debtor was lulled into a sense of security that his objections would be heard on their merits. In such a situation it would

be opposed to all principles of justice if the judgment-debtor were to be later on told that for want of a formal separate application he won''t be

heard. Ends of justice clearly require that a Court should condone the formal defect, if any, and accept and act upon a substantial compliance with

the provision.

In Bangarayya v. Ramabhadriraju ILR (1948) Mad. 123 the subject matter in a suit was referred to arbitration and the award was filed on

21st November 1944 On that date the Court posted the suit for objections to 2nd December 1944 On the adjourned date the Defendant filed the

objections while the Plaintiff was satisfied with the award and filed none. The enquiry was then adjourned to 11th January 1945 and preliminary

objection was raised by the Plaintiff that the Defendant could not be heard but a decree should be passed in terms of the award as the Defendant

had not filed a separate application to set aside the award. The Bench held that the objections of the Defendant amounted to an application to the

Court to set aside the award.

The same view was taken by CHANDRA REDDY J., as he then was, in Ramaswami Servai and Others Vs. Muthiralayee and Others, and it

was held that there is no need for the party to file a separate application to set aside an award in any particular form, and that a counter affidavit

filed by the party within thirty days of the service of notice of the petition, attacking the genuineness and validity of the award and praying that the

Court might be pleased to pass an order dismissing the petition was sufficient compliance with the terms of the provision. The same view was taken

by a Bench of the Bombay High Court in Gopalji Kallianji v. Chhaganlal Vitthalji ILR (1920) 45 Bom. 1071.

In the instant case the decree-holder for a considerable time never raised the objection of the Bar under Order XXI, Rule 2. On the other hand

his conduct shows that he regarded the statement of the judgment-debtor as satisfying the requirements of law and he only sought an adjudication

on the merits. When the matter has been heard for sometime and after a portion of the documentary and oral evidence, had been recorded, the

decree-holder decided not only to withdraw the execution petition but also raised the present objection with the evident object of over-reaching

the judgment-debtor. I see nothing in principle or authority which compels or obliges the Court to recognise such a right in the decree-holder

resulting in obvious injustice.

In Lodd Govinda Doss v. Rajah of Karvetnagar (1915) 29 M.L.J. 219 a decree for sale was passed in favour of a mortgagee in possession,

for the principal and interest, but the decree did not provide for the taking of accounts of the profits that might be received by the mortgagee after

the date of the decree. In the application for sale of the property the decree-holder intimated to the Court that the profits and rents received by him

should go in reduction of the decree amount, and that the matter may be investigated by the executing Court. The Bench held that even though it

was not open to the executing Court to direct the taking of accounts not covered by the decree in view of the attitude of the decree-holder, the

Court should direct an enquiry and certify the adjustment by way of receipt of rents. The ratio of this decision is that in construing the scope of and

in applying Order XXI, Rule 2 Courts should make every effort to prevent parties from defeating justice, and discourage fraudulent execution of

decrees.

In Somu Pathar v. Rengaswami Reddiar (1918) 35 M.L.J. 253 it was held that when once a Court is seized of an enquiry to enter up

satisfaction it was bound to make an enquiry and the Court will not be justified in allowing that enquiry to be withdrawn where it would defeat

justice. This decision was followed by Varadachariar J., in Kailasa Padayachi Vs. Duraiappa Kachirayar and Another, , in which it was held that

the mere fact that the decree-holder was absent or indifferent was no justification for the Court not to have proceeded with the enquiry when the

judgment-debtor was interested in a decision and was prosecuting the same. The ratio of this decision shows that Courts have always regarded

substantial compliance of Order XXI, Rule 2 and have not insisted upon a technical, literal compliance of the provision.

For all these reasons I have no hesitation in holding that the decision of the District Judge is correct and the objections of the judgment-debtor

should be investigated on their merits. The revision petition is dismissed with costs.