The 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 Munsiff''s Court, and three in the

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

Immovable property sold and Rs. 4,915 which was realised was brought into the District Munsiff''s Court. The other decree-holder in the District

Munsiff''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 Munsiff. The Sub-Court

acting u/s 63, Civil Procedure Code, sent for the amount which was received by it on 7th September, 194.6. 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 Munsiff''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

them-selves therefore into a contest between three Sub-Court decree-holders who have been deprived of rateable distribution and two decree-

holders in the District Munsiff''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(I) 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 Munsiff''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 Munsiff 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), CPC 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 u/s 63, Civil Procedure Code, 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. Ramaswami 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 Munsiff''s Court. To adopt this view would be to do considerable violence to

the simple language of Section 73(I) 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 rate able distribution to a suit in the circumstances. I consider that these revision petitions, are sustain rate able. They are allowed and

the petitioners will be admitted to rate-able 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 in fructuous attempts on the second respondent 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 the

second respondent on that petition to revise this identical order, the second respondent 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 the first respondent 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.