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Board Of Trustees Of The Port Of Mormugao v. Chowgule & Company Pvt. Ltd. Mormugao Harbour, Gao .
Structured Summary of the Opinion (Revision Allowed)
Factual and Procedural Background
This revision arises from the Order dated 21 December 1983 of the Civil Judge, Senior Division, Margao, which dismissed petitioners' application for enforcement of an undertaking / Bond executed by respondents in Special Civil Suit No. 46 of 1969.
Relevant facts (as stated in the opinion):
- In 1958 the Portuguese Government enacted Decree Law No. 41816; in 1959 (30 March) a contract was entered into between the Portuguese Government and the respondents to build and operate a mechanical ore handling plant ("MOHP") at Mormugao Harbour. The contractual handling charge was Rs. 4 per tonne, of which 2/3 went to respondents and 1/3 to the West of India Portuguese Guaranteed Railway Company; the respondents' net liability was recorded as Rs. 1,375 paise per tonne (i.e., the lower concessional rate).
- Respondents constructed the MOHP (in or about 1957) and, in or about April 1967, began manufacturing and exporting iron ore pellets through the MOHP, claiming the concessional rate of Rs. 1,375 per tonne. Petitioners objected on the ground that pellets are manufactured products and not "iron ore" under the contract. Petitioners proposed arbitration but respondents did not agree; petitioners then by resolution dated 9 July 1969 decided pellets would be exported only on payment of Rs. 3.35 per tonne and communicated this on 11 July 1969.
- Respondents (original plaintiffs) filed Special Civil Suit No. 46/1969 (11 August 1969) seeking declaration and permanent injunction restraining petitioners from recovering sums in excess of Rs. 1,375 per tonne in respect of pellets. The trial Judge granted ex parte interim injunction and issued notice on 14 August 1969; later, on 18 April 1970, the interim injunction was confirmed, and the Court directed respondents to submit half-yearly export statements and to furnish suitable security for the difference between Rs. 1,375 and Rs. 3.35 per tonne for pellets exported until final disposal of the suit.
- Respondents executed a Bond on 11 June 1970 undertaking to pay the difference should the suit be finally decided against them; the Bond was filed by Order dated 15 June 1970 and later described by the trial Judge as “accepted by the Court.” Petitioners sought a guarantee instead of the Bond (application 15 June 1970) but this was refused by order dated 3 February 1976.
- The trial Court (Civil Judge, Senior Division, Margao) originally decreed the suit for respondents by judgment dated 31 March 1978. That decree was reversed on appeal by a Division Bench of the High Court on 21 March 1983. Respondents' Special Leave Petition to the Supreme Court was dismissed on 12 August 1983; a review of that dismissal was also dismissed.
- While appeal proceedings were pending respondents filed a fresh suit (Special Civil Suit No. 21/1983) in Vasco (7 April 1983) disputing the petitioners' resolution of 9 July 1969. In that suit the petitioners included a counter-claim for the differential amount (aggregate Rs. 89,99,444.27) and respondents in reply contended that such claim was barred by limitation.
- After the SLP dismissal, on 14 September 1983 petitioners filed Special Application No. 292/1983 in the Margao Court seeking enforcement of the Bond dated 11 June 1970 for a sum of Rs. 61,79,601.25 (claimed to be due from the date of the 18 April 1970 order). Respondents admitted the correctness of the amount in their reply. The Civil Judge dismissed the enforcement application by order dated 21 December 1983. This revision challenges that dismissal.
Legal Issues Presented
- Whether the Order dated 18 April 1970, read with the ex parte order dated 14 August 1969 and the subsequent acceptance of the Bond, constitutes an order for payment such that the Bond / undertaking becomes executable under Section 145 of the Civil Procedure Code (C.P.C.)?
- Whether, alternatively, the trial Court should have enforced the Bond / undertaking by exercising its inherent jurisdiction even if Section 145 C.P.C. did not apply?
- Whether respondents are estopped from denying liability under the undertaking / Bond they executed and filed in Court?
Arguments of the Parties
Petitioners' (Appellants') Arguments
- The learned Civil Judge failed to exercise jurisdiction vested in him by not enforcing the undertaking given to the Court and the Bond executed by respondents to pay the differential (Rs. 3.35 minus Rs. 1,375) for exported pellets. The undertaking/Bond is enforceable under Section 145 C.P.C.
- Even if Section 145 C.P.C. is inapplicable, the Court has inherent jurisdiction to enforce the Bond and should have exercised it.
- Respondents are estopped from disputing the undertaking given to the Court.
Respondents' (Respondents') Arguments
- The revision application is not maintainable: revisional powers are discretionary and should not be used where alternate remedies are available (petitioners had a counterclaim in Suit No. 21/83 and could file a summary suit).
- Section 145 C.P.C. does not apply because (a) the undertaking was not given to the Court but to the defendants, (b) there is no order of the Court directing payment and (c) Section 145 applies to third-party sureties/guarantors, not to a party to the suit who furnishes security.
- The Bond ceased to subsist after the suit was decreed on 31 March 1978, so it could not be enforced thereafter.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court in this Opinion |
|---|---|---|
| Harendra Kumar Ghosh v. Gurupada Bhowmick (Calcutta High Court; AIR 1937 Cal. 452) | Holds that an application for execution against sureties can be regarded as execution of a decree under Section 145 C.P.C.; sureties become judgment-debtors by operation of Section 145. | The Court observed this authority but held it did not assist petitioners because those cases do not dispense with the requirement that there must be an order for payment; acceptance of a Bond alone does not imply an order to pay. |
| Parkash Chand Mahajan v. Madan Theatres Ltd. (Lahore High Court; AIR 1936 Lah. 463) | Holds that a decree against a judgment-debtor can be executed against his surety who, by a statement before the Court, undertakes to satisfy the judgment-debtor's liability. | Cited by petitioners; Court distinguished it, noting it does not support the proposition that no express order to pay is necessary where the security was accepted but no payment order made. |
| Nadanaligi Kurugodappa v. Angadi Soogamma (Madras; AIR 1918 Mad. 661) | Used to support the proposition that Section 145 requires the existence of an order or decree for payment before a guarantee/security can be executed. | Relied on by respondents and accepted by this Court as supporting the view that absence of an order to pay prevents invocation of Section 145. |
| Mt. Khairunnissa Bibi v. Oudh Commercial Bank (All. Full Bench; AIR 1933 All 269) | Authority discussing the limits of Section 145 and indicating that a separate suit may be the proper remedy in some circumstances. | The Court distinguished it because in Khairunnissa Bibi the Bond was not given to the Court; thus that authority did not control the present case. |
| Sm. Kunja Moyee Dassi v. Akshoy Kumar Das (Calcutta; AIR 1961 Cal 43) | Affirms that Section 145 applies where there is an order for payment and a guarantee/security in respect of that order. | Used to reinforce the point that Section 145 presupposes an order of the Court to which the guarantee relates; absence of such an order defeats invocation of Section 145 here. |
| Sadasiva Pillai v. Ramalinga Pillai ((1875) 2 Ind App 219) | Privy Council authority holding that undertakings given to the Court may be enforced by the Court's inherent powers even if not enforceable under statutory execution provisions. | Cited by petitioners in support of the proposition that the Court can enforce an undertaking given to it by exercising inherent jurisdiction; relied upon by this Court as persuasive authority. |
| Raj Raghubar Singh v. Jai Indra Bahadur Singh (AIR 1919 P.C. 55) | Privy Council authority referenced for the proposition that courts can enforce undertakings given to them. | Relied on as part of a line of authorities supporting enforcement by inherent jurisdiction where an undertaking is given to the Court. |
| Sankunni Variar v. Vasudeva Nambudripad (Madras; AIR 1926 Mad 1005) | Holds that when an undertaking is given to the Court the Court should order execution of its own order rather than force the decree-holder to file another suit; avoids delays and hazards of a separate suit. | The Court expressly adopted the reasoning and quote from this case to justify enforcing the Bond via inherent jurisdiction to prevent injustice and delay. |
| Kunhi Moidin v. Kunhi Koman Nair (Madras; AIR 1933 Mad 691) | One of several Madras decisions cited in the context of enforcement of undertakings to the Court. | Included by petitioners to support inherent jurisdiction principle; treated as part of a consistent line of authority endorsing court enforcement of undertakings. |
| Muthuswami Pillai v. Manikka Moopan (Madras; AIR 1936 Mad 990) | Madras High Court decision in the same line on enforcement of undertakings to Court. | Relied upon by petitioners and regarded by this Court as part of the body of precedent supporting enforcement by inherent power when the undertaking is to the Court. |
| Ouseph Korathu v. Gopalan Nair (Travancore-Cochin; AIR 1952 Travancore-Cochin 237) | Travancore-Cochin authority on enforcement of undertakings to the Court. | Included as supportive precedent for the exercise of inherent jurisdiction to enforce undertakings given to the Court. |
| Krishnan v. Dorarajan Chettiar (Kerala; AIR 1980 Kerala 234) | Kerala High Court authority on the subject of enforcing undertakings given to the Court. | Cited as part of the series of authorities showing judicial willingness to enforce undertakings by inherent powers; regarded as persuasive. |
| Ram Chand v. Pitam Mal (Calcutta; ILR citation) | Relied upon by respondents for the proposition that in some cases a Bond may cease to subsist upon disposal of suit. | The Court rejected application of this authority to the present facts because appeals continued (appeal is continuation of the suit) and other factual differences existed. |
| Yamin-ud-Dowlah v. Amed Ali Khan (Calcutta; ILR 21 Cal 561, 1894) | Also cited by respondents to argue that securities can cease with the suit's disposal in certain contexts. | Distinguished by this Court on grounds that in the present case appeals and further proceedings continued and the Bond had been accepted and filed in Court; hence the authority did not govern the present facts. |
Court's Reasoning and Analysis
The Court undertook a two-stage analysis: (A) preliminary point on maintainability of revision; and (B) merits — interpretation of Section 145 C.P.C., the availability of inherent jurisdiction, and whether the Bond subsisted.
A. Maintainability of the Revision
- The Court acknowledged that revisional jurisdiction is discretionary and should be used sparingly, particularly where alternative remedies are available.
- However, after reviewing the litigation history — trial injunction, requirement for security, the Bond, the trial decree (31 March 1978), reversal on appeal (21 March 1983) and dismissal of SLP by the Supreme Court (12 August 1983) — the Court concluded no certain, effective and conclusive alternative remedy remained for petitioners to recover the differential amount without enforcement of the Bond.
- Because respondents were asserting limitation and had prevented petitioners from collecting the enhanced rates by securing an injunction, the Court found revisional intervention justified. Result: the revision was held maintainable.
B. Interpretation and Application of Section 145 C.P.C.
- The Court examined Section 145 which permits execution of a decree/order against a person who has furnished security or given a guarantee "in the manner provided for the execution of decrees" and treats that person as a party for execution purposes.
- Two essential requirements were identified from the statutory text and prior authorities:
- the person furnishing the security/guarantee must be a third party (not a party to the suit), and
- there must be an order or decree for payment (i.e., a court order/decree creating the liability) to which the security or guarantee relates.
- The Court rejected petitioners' argument that the 1976 amendment of Section 145 expanded its scope to include parties who furnished security: the text's phrase that the person "shall be deemed to be a party within the meaning of S. 47" implies that the statutory construct presumes the person is not already a party. Thus the section is to be applied where security/guarantee is furnished by a third party.
- Applying these principles to the facts, the Court found:
- The Bond was executed by the respondents themselves (i.e., parties to the suit), not by a third party.
- Although the trial Judge ordered that "suitable security" be furnished and accepted the Bond (filed by Order dated 15 June 1970 and thereafter described as "accepted by the Court"), the trial Court did not make an express order directing payment of the differential amount; acceptance of a Bond does not automatically amount to an express order for payment.
- Conclusion on Section 145: the statutory machinery of Section 145 C.P.C. was not available to petitioners to enforce the Bond because (i) the Bond was furnished by a party to the suit and (ii) there was no express order of the Court directing payment to which Section 145 could relate.
C. Inherent Jurisdiction to Enforce the Undertaking/Bond
- The Court considered the line of authorities (Privy Council, Madras, Travancore-Cochin, Kerala decisions) holding that when an undertaking is given to the Court, the Court has the inherent power to enforce it and should do so rather than compel the decree-holder to institute a separate suit.
- The Court found that the Bond in this case was indeed an undertaking to the Court:
- It was executed in compliance with the trial Judge's direction for "suitable security."
- It was filed in Court, formed part of the record, and the trial Judge accepted it as constituting "suitable security."
- It was not in the neutral form set out in Appendix G of the Civil P.C. (i.e., it was not addressed to a private person) and was clearly intended to secure the petitioners' interest arising from the injunction.
- Given these facts and the authorities (notably Sankunni Variar and the Privy Council decisions), the Court held that the trial Court should have exercised its inherent jurisdiction to enforce the undertaking / Bond rather than forcing petitioners to file a separate suit, which would subject them to hazards and delays and might leave them exposed to limitation pleas.
- Accordingly, refusal by the Civil Judge to enforce the undertaking by inherent jurisdiction was a failure to exercise a jurisdiction vested in him and risked causing irreparable injury to petitioners.
D. Whether the Bond Had Ceased to Subsist
- Respondents argued the Bond ceased upon the trial Court's decree dated 31 March 1978. The Court rejected this because (a) appeal is a continuation of the suit and the relevant proceedings continued through the appellate process, (b) petitioners had pursued appellate remedies that culminated in reversal and dismissal of respondents' SLP, and (c) authorities cited by respondents were inapposite on the facts.
- The Court also relied on ordinary estoppel principles to hold that respondents could not avoid the liability they had solemnly undertaken to pay under the Bond after the suit's final outcome.
Holding and Implications
Holding: Revision allowed. The impugned Order dated 21 December 1983 of the Civil Judge, Senior Division, Margao is set aside.
The Court ordered that the learned Civil Judge should, in the exercise of his inherent powers, re-examine the petitioners' application for enforcement of the Bond dated 11 June 1970 and the undertaking given in Suit No. 46/1969 to pay the differential between Rs. 1,375 and Rs. 3.35 per tonne, and thereafter dispose of that application in accordance with law. Costs were awarded against the respondents. The Court refused a certificate of fitness to appeal to the Supreme Court.
Implications (as stated or necessarily flowing from the opinion)
- Direct effect on parties: Petitioners obtain relief in revision — the matter is remitted to the trial Court to consider enforcement of the Bond/undertaking under the trial Court's inherent jurisdiction; respondents must face the enforcement proceedings and bear costs.
- On legal principles:
- The opinion clarifies the Court's understanding of Section 145 C.P.C.: (a) Section 145 is primarily intended to apply where security/guarantee is furnished by a third party (not a party to the suit), and (b) Section 145 presupposes an express order or decree for payment to which the security relates; absence of such an order prevents Section 145's invocation.
- The Court affirms the established principle that where an undertaking is given to the Court and accepted by it, the Court may and should, in proper circumstances, enforce that undertaking by exercising inherent jurisdiction rather than forcing the beneficiary to institute a separate suit — to avoid injustice, delay and the hazards of separate litigation (as illustrated in Sankunni Variar and related authorities).
- The Court noted that no certificate of fitness to appeal to the Supreme Court should be granted because no substantial question of law of general importance was made out.
Note: This summary is confined strictly to the facts, arguments, authorities and reasoning as they appear in the provided opinion. No information not present in the opinion has been added.
1. This revision application arises out of the Order dt. 21st December, 1983 passed by the learned Civil Judge, Senior Division, Margao, dismissing the application filed by the petitioners herein for the enforcement of an undertaking given or a Bond executed by the present respondents in a suit, being the Special Civil Suit No. 46/1969, filed by the latter for a declaration and a permanent injunction restraining the former from collecting some enhanced rates on iron ore pellets exported by the respondents/original plaintiffs.
2. In order to correctly understand the case of the petitioners, it will be convenient to state the relevant facts that led to the making of the impugned order.
On 4th September, 1958, while the territories of Goa, Daman and Diu were still under the Portuguese rule, the Portuguese Government enacted the Decree Law No. 41816, inter alia, empowering the then Overseas Minister to enter into contracts with the West of India Portuguese Guaranteed Railway Company Ltd. and to grant to the latter the right to construct and operate at the Mormugao Harbour a mechanical installation for the storage and handling of ores. In exercise of such enabling powers, the Portuguese Overseas Minister entered, on behalf of the Portuguese Government, into a contract with the respondents on 30th March, 1959. Under the terms and conditions of the said contract, respondents were to construct and operate a mechanical ore handling plant (hereinafter called MOHP) for the purposes of loading and handling ore and a sum of Rs. 4/- would be charged on each tonne of iron or exported through the said plant. It was further agreed that out of the sum of Rs. 4/-, 2/3rd would go to the respondents and the remaining 1/3rd to the West of India Portuguese Guaranteed Railway Company Ltd. Thus, the respondents would be liable to pay only Rs. 1,375 paisa per each tonne of iron ore exported by them. Pursuant to this contract, respondents constructed, in or about 1957, the said MOHP for the export of iron ore, whether theirs or other exporters, and started its operation. In or about April, 1967, respondents started manufacture of iron ore pellets and began to export such pellets through the said Plant on the concessional rate of Rs. 1,375 per tonne. Petitioners objected to this on the ground that pellets, being a manufactured product from iron ore, were not falling within the meaning of iron ore in Cl. 30 of the Contract dated 30th March, 1959 and since the respondents did not agree, it was suggested that the matter be referred to arbitration as envisaged in the said Contract. Again, the respondents did not agree with this suggestion and hence, petitioners, on 9th July, 1969, decided that the export of pellets would be permitted only on payment of a rate of Rs. 3.35 per tonne, this decision having been communicated to the respondents by letter dated 11th July, 1969.
3. Respondents reacted to decision by filing, on or about 11th August, 1969, the aforesaid Special Civil Suit No. 46/1969, inter alia, praying that the petitioners/defendants in the said suit be permanently restrained by a perpetual injunction from acting upon or in pursuance of the said letter dated 11th July, 1969 and from recovering from them any sum in excess of Rs. 1,375 per tonne in respect of the export of iron ore pellets. Respondents also sought an interim injunction in the same terms of the prayer for permanent injunction. The learned trial Judge granted ex parte the sought interim injunction and further issued, on 14-8-1969, a notice to the petitioners/defendant to show cause why the said injunction should not be made absolute. Petitioners showed cause against the confirmation of the ex parte injunction and also prayed for the stay of the said suit under S. 34 of the Arbitration Act in view of the provisions regarding arbitration contained in the Contract entered into on 30th March, 1959. The learned trial Judge, however, by his Order dated 18th April, 1970, refused to stay the suit and further confirmed the injunction earlier granted ex parte by him. The petitioners preferred an appeal against the aforesaid refusal to stay the suit to the then existing Judicial Commissioner's Court, but such appeal was dismissed on 19th August, 1975.
4. While confirming the injunction ex parte granted by him, the learned trial Judge however directed the respondents to submit half yearly statements of the pellets exported by them and to produce a suitable security for the difference between Rs. 1,375 and Rs. 3.35 per tonne in respect of the pellets exported. In compliance with the said order, respondents executed, on or about 11th June, 1970, a Bond whereby they undertook and bound themselves to pay to the petitioners the said difference between Rs. 1,375 and Rs. 3.35 per tonne in respect of pellets exported, should the suit be finally decided against them. The petitioners, however, being unsatisfied by such Bond, prayed by an application dated 15th June, 1970 that the respondents be ordered to give proper Guarantee instead of a mere Bond, but this was refused by the learned trial Judge by Order dated 3rd February, 1976.
5. The said Special Civil Suit No. 46/1969 was decided in favour of the respondents/original plaintiffs by judgment dated 31st March, 1978 passed by the learned Additional Civil Judge, Senior Division, Margao. This judgment and decree was, however, successfully challenged in appeal by the petitioners, for a Division Bench of this Court to which I was a party reversed on 21st March, 1983 the said judgment. Certificate of fitness to appeal to the Supreme Court having been denied, respondents approached the Apex Court with a Special Leave Petition which was dismissed on 12th August, 1983. Dissatisfied, respondents unsuccessfully filed a review application against the Order of dismissal of their Special Leave Petition and thus, the aforesaid Special Civil Suit No. 46/1969 stood finally disposed of and dismissed. However, after the judgment of the trial Court was reversed by the Division Bench of this Court on 21st March, 1983 and before moving the Supreme Court with the Special Leave Petition, respondents filed on 7th April, 1983 a fresh suit in the Court of Civil Judge Senior Division, Vasco-da-Gama, being the Special Civil Suit No. 21/1983, praying for a declaration that the resolution of the petitioners dated 9th July, 1969 was not binding on them and that the petitioners were not entitled to recover any rate in respect of pellets exported through the aforementioned MOHP at the rate fixed by the said Resolution or any other rate fixed unilaterally by the petitioners.
6. After the dismissal of the Special Leave Petition by the Supreme Court on 12th August, 1983, the petitioners filed in the Court of Civil Judge, Senior Division, Margao on 14-9-1983 an application, being Special Application No. 292/1983 for enforcement of the Security Bond executed by the respondents on 11-6-1970 and prayed they be paid a sum of Rs. 61, 79, 601.25 due from the date of the Order of the trial Judge dated 18-4-1970 in discharge of the Bond executed by the same respondents. The correctness of this amount was admitted by the respondents in their reply to the Said application for enforcement of the Bond. In the meanwhile, petitioners had filed their written statement in the Special Civil Suit No. 21/83 filed by the respondents in the Vasco Court and had also preferred a counter-claim for the total difference of amount between Rs. 3.35 per tonne and Rs. 1,375 per tonne due by the respondents, aggregating to Rs. 89,99,444.27, stating, however, that the respondents would be given credit for the amount realised by enforcement of the Bond in the Special Civil Suit No. 46/69, respondents, in their reply to the counter-claim, inter alia, contended that the counter-claim for the said differential amount is barred by limitation. The learned Civil Judge, Senior Division, Margao, finally disposed of the aforesaid application for enforcement of the Bond, for by his Order dated 21st December, 1983 dismissed it. The present revision application is directed against the aforesaid Order.
7. Petitioners challenge the said Order on several grounds, but in the course of the hearing, their learned counsel, Mr. Andhyarujina, did not press most of them and, restricting the attack, submitted that the learned Civil Judge has failed to exercise the jurisdiction vested in him inasmuch as he failed to get enforced the undertaking given to the Court by the respondents and the Bond executed by them to pay to the petitioners the difference in the rate to be paid for the export of the iron ore pellets between Rs. 3.35 and Rs. 1,375 per tonne. He contended that the said undertaking and Bond can be enforced under the provisions of S. 145 C.P.C and, as such, the learned Judge, having held differently, has failed to exercise the jurisdiction vested in him. The learned counsel further urged that, in any event, even if the undertaking and the Bond was not enforceable under the provisions of S. 145 C.P.C, the learned Judge ought to have exercised his inherent jurisdiction for getting the undertaking duly enforced. He also submitted that, at any rate, respondents are estopped from disputing their undertaking given to the Court.
8. Meeting the case of the petitioners, Mr. Setalvad, learned counsel appearing for the respondents, however contended that, first of all, this revision application is not maintainable. In fact, the revisional powers are merely discretionary and cannot be used where and when a remedy is provided by law and the concerned party can take recourse to such remedy in order to get redress for his grievance. Secondly, the view taken by the learned Civil Judge is correct, for the undertaking or Bond cannot be executed or enforced under the provisions of S. 145 C.P.C, since (a) the undertaking was not given to the Court but it is an undertaking to pay to the defendants in the suit; (b) there is no order of the Court to pay; and (c) section 145 does not apply to a party in the suit. Thirdly, the learned counsel further argued, the Bond was no more subsisting after the suit was decreed by the learned trial Judge on 31st March, 1978.
9. Before addressing myself to the merits of this revision application and before considering the rival contentions, I feel it expedient and proper to deal first, as a preliminary point, with the question of its maintainability. It has been contended on behalf of the respondents that, considering the scope of a revision application, it is manifest that the powers of the Court in revision are merely discretionary and, as such, when a remedy is provided by law and the party concerned can avail himself of such remedy to get redress for his grievance, then, it is not open to him to seek relief in a revision application. Mr. Setalvad then urged that the petitioners had already preferred a counterclaim in the Special Civil Suit No. 21/83 instituted by the respondents in the Vasco Court, having included in the said counterclaim the amount sought to be realised by the enforcement of the Bond. Further, nothing prevents the petitioners, if they so desire, to file a summary suit for the enforcement of the undertaking or Bond executed by the respondents. This being the position, the learned counsel argued, it is not open to the petitioners to seek relief in a revision application and, on the other hand, there is no warrant for the Court to exercise its revisional powers.
10. Undoubtedly, the exercise of revisional jurisdiction by the High Court is merely discretionary. It cannot be, therefore, gainsaid that it is for the Court to satisfy itself whether, in the circumstances of each case, there is warrant for the exercise of such discretionary powers. This discretionary jurisdiction is vested in the High Court to advance justice and is not however to be used as a matter of routine, but sparingly. Thus, if an alternative remedy by way of a suit or-otherwise is open to the aggrieved party, then, the High Court in the exercise of its discretion, may ordinarily, specially when the alternative remedy is certain and conclusive, refuse to act under its revisional jurisdiction. It will therefore be necessary to look into the particular facts of the case at hand in order to satisfy myself whether there are reasonable grounds to justify my acting in the exercise of the revisional jurisdiction.
11. Mr. Andhyarujina submitted that, in the circumstances of this case, the exercise of the revisional powers by this Court is not only justified but necessary, for no certain effective and conclusive remedy to get relief for their grievances is left open to the petitioners. He argued that, even before the filing of the Suit No. 46/69, the controversy between the petitioners and the respondents was whether or not pellets were within the meaning of iron ore in the contract. This controversy was the main issue in the said suit and though such controversy was decided in favour of the respondents by the learned trial Judge, ultimately, the Division Bench of this Court by judgment delivered on 21st March, 1983 held that pellets were a manufactured product and, as such, outside the meaning of iron ore in the contract dated 30th March, 1959 entered into by the Portuguese Government with the respondents. The learned counsel further submitted that, soon after the Division Bench allowed the appeal of the petitioners by judgment delivered on 21st March, 1983, the respondents instituted a fresh suit in the Vasco Court and while once again raising the question that pellets were within the meaning of iron ore in the said contract, contended that, in any event, the petitioners were not entitled to enhance the export rate of pellets unilaterally. The petitioners filed their written statement and further preferred a counter-claim in respect of the differential amount between the rates of Rs. 3.35 and Rs. 1,375 per tonne due-from the time respondents started the export of pellets through MOHP. In their reply to the counter-claim, the respondents contended that the said claim is time barred. Then respondents, besides filing the said suit, also moved the Supreme Court with a Special Leave Petition which was dismissed on 12th August, 1983, as dismissed was their Review Application filed against the order of dismissal of the Special Leave Petition. The Special Civil Suit No. 46/1969 having been thus finally decided, petitioners filed on 14th September, 1983 an application for the enforcement of the undertaking given or the Bond executed by the respondents as a security for the payment of the difference between the rates, the amount claimed having been admitted to be correct by the respondents. In the premises, Mr. Andhyarujina argued, since the respondents had already raised the question that the claim of the petitioners in respect of the differential amount of rates is time barred, it is apparent that no effective and conclusive remedy is left open to the petitioners to recover the said amount, being a fact that they were prevented from exercising their powers under Ss. 59 and 61 of the Major Port Trusts Act, 1963 by the injunction granted by the trial Court.
12. It is common ground that the Suit No. 46/1969 was instituted by the respondents in order, inter alia, to restrain the petitioners from recovering rates for the export of pellets through MOHP at Berth No. 6, Mormugao Harbour in excess of Rs. 1,375 per tonne; that respondents sought a temporary injunction restraining the petitioners in terms of the prayer in the suit and the said injunction was first granted ex parte and then, by Order dated 18th April, 1970, made absolute, but respondents were also directed to submit half yearly statements of pellets exported by them till the final disposal of the suit and, further, to give a suitable security for the difference in the rates; that the respondents, accordingly, executed a Bond on 11th June, 1970, whereby they undertook and bound themselves to pay to the petitioners the difference between the rates in dispute in the suit, should the said suit be finally decided against them; that this Bond was accepted by the learned trial Judge and it was ordered on 15-6-1970 to be filed; that this suit was decreed by the Civil Judge Senior Division, Margao, by judgment dated 31st March, 1978, but this judgment was reversed in appeal by a Division Bench of this Court on 21st March, 1983; that a Special Leave Petition was filed by the respondents in the Supreme Court and the said petition was dismissed on 12-8-1983, as dismissed was a Review Application filed against the said dismissal; that, prior to the filing of the said Special Leave Petition, respondents filed in the Court of Vasco a suit praying that the petitioners are not entitled to recover rates in respect of the pellets exported through the MOHP at the rate fixed by the Resolution passed by the petitioners on 9th July, 1969; and that, in reply to the counter-claim preferred in the said suit by the petitioners, respondents had contended that the differential amount between the two disputed rates cannot be recovered, since it is barred by limitation. It does not require much effort to see, in the light of the above facts, that a certain, effective and conclusive alternative remedy by way of a suit or otherwise is no more available to the petitioners and that the only effective means open to them to recover the said differential amount is by enforcing the undertaking given or Bond executed by the respondents, for the latter, having succeeded in preventing the petitioners from recovering the enhanced rates on the strength of the temporary injunction confirmed on 18th April, 1970, are now contending, and will most probably contend in any suit instituted for the purpose of recovery of the said amount by the petitioners. That the petitioners claim in that respect is barred by limitation. In the premises therefore, I am firmly of the view that this is a case where the looking into the impugned order in exercise of the revisional powers is entirely justified. Hence, I hold this revision application maintainable.
13. Having thus disposed of the preliminary point regarding the maintainability of the present revision application, I turn now to the merits thereof. As already stated, though the petitioners had attacked the impugned order in the memo of revision on several grounds, Mr. Andhyarujina restricted the challenge to….. namely (a) the order dated 18th April, 1970 is, on its true construction, an order on the plaintiffs/respondents herein to pay the difference between Rs. 1,375 and Rs. 3.35 per tonne in respect of the quantities of pellets exported by the respondents through the said MOHP and, as such, upon the final dismissal of the suit, respondents became liable to pay the differential amount. The said Order is executable and can be executed under S. 145 C.P.C; (b) in any event, the Court has general and inherent jurisdiction to enforce the Bond; and (c) respondents are estopped from disputing the undertaking given to the Court. These points were urged by the learned counsel in order to show that the learned trial Judge has failed to exercise the jurisdiction vested in him by not enforcing the said undertaking or Bond. I will therefore address myself to the said questions seriatim.
14. As regards the first question, the learned counsel has submitted that the Order dt. 18-4-1970 has to be read with the order dated 14-8-1969 granting the injunction ex parte, since, by the said Order made on 18-4-1970, the learned trial Judge has confirmed the ex parte injunction earlier granted by him. But, being satisfied that the interests of the defendants/petitioners herein required to be safeguarded, directed the respondents not only to submit half yearly statements of the pellets exported, but also to supply suitable security for the difference of rates on the export of pellets till the final disposal of the suit. He further submitted that the respondents had executed the Bond sought to be enforced as they had been compelled to do so by the Order of the Court and this Bond was taken on record by Order dated 15-6-1970, having been accepted by the Court, as can be seen from the Order dated 3rd February, 1976 passed by the learned Civil Judge. The learned counsel then invited my attention to the circumstance that the respondents had undertaken and bound themselves to pay to the petitioners the amount representing the difference between Rs. 1,375 and Rs. 3.35 per tonne in respect of the pellets exported by them should the suit be decided finally against them and urged that, with the final dismissal of the suit, the respondents became liable to pay the said differential amount. He further argued, placing reliance in the cases of Harendra Kumar Ghosh v. Gurupada Bhowmick, AIR 1937 Cal. 452 and Parkash Chand Mahajan v. Madan Theatres Ltd. AIR 1936 Lah. 463 that since the Bond was executed pursuant to the trial Judge's Order dated 18-4-1970 and since the said Bond was executed by the trial Court, the terms of the same Bond had been incorporated in the order of acceptance of the Bond. Hence, he concluded the said Order dated 18-4-1970 on its true construction, is an Order on the plaintiffs/respondents herein to pay the said differential amount and, therefore, executable under S. 145 C.P.C
15. It was however contended by Mr. Setalvad that the provision of S. 145 C.P.C is not available to the petitioners in order to get enforced the aforesaid Bond. He submitted that in the case at hand only clause (c) of S. 145 will be relevant and that from the point of view of the said clause, the operative part of S. 145 provides that an Order for the payment of money can be executed against the surety who shall be deemed to be a party within the meaning of S. 47. The object of S. 145 is to create a legal fiction providing that in certain contingencies a person furnishing a security or giving a guarantee shall be deemed to be a party within the meaning of S. 45, which is designed to avoid multiplicity of proceedings and provides that all questions arising between the parties in the suit and relating to execution and discharge or satisfaction of a decree shall be determined by the Executing Court and not by a separate suit. S. 145 further provides that the relevant Order can be executed against the person giving the guarantee or furnishing security. Thus, according to the learned counsel bearing in mind that S. 145 provides that such person shall be deemed to be a party, it becomes crystal clear that the provisions do not apply to a case where the party himself gives the guarantee or furnishes security, for, in such a case, S. 47 is attracted. Besides, S. 145 requires an order for payment of money and a security or a guarantee pertaining to such Order. The learned counsel further urged, relying in the rulings in Nadanaligi Kurugodappa v. Angadi Soogamma, AIR 1918 Mad. 661, Mt. Khairunnissa Bibi v. Oudh Commercial Bank, Fyzabad, AIR 1933 All 269 (FB) and Sm. Kunja Moyee Dassi v. Akshoy Kumar Das, AIR 1961 Cal 43, that only if such an order exists, then the said guarantee can be executed. In the case at hand, no such order to pay exists and, therefore, the undertaking or Bond executed by the respondents cannot be enforced as sought by the petitioners.
16. Section 145 C.P.C provides that where any person has furnished security or given a guarantee, inter alia, for the payment of any money or for the fulfilment of any condition imposed on any person, under an order of the Court in any suit or in any proceeding consequent thereon, the decree or order may be executed in the manner provided for the execution of decrees, if he has rendered himself personally liable, against him to that extent and such person shall be deemed to be a party within the meaning of S. 47. It is clear from the wording of S. 145 that its scope is to entitle the person for whose benefit security was given to enforce the security by executing the decree or order against the surety or guarantor to the extent to which he has rendered himself personally liable, in the same manner as if the surety or guarantor was a party to the decree or order and was directed by the decree or order to perform the obligation undertaken by him, without having to institute a suit to enforce the security. The section thus provides for a summary remedy in execution and dispenses with the necessity of a separate suit to the extent to which the surety has rendered himself personally liable. Though this provision of law speaks of “any person” who has furnished security or gives a guarantee and this expression may justify the view that it embraces in its meaning the parties to the suit also when they furnish security or give guarantee, I am of the firm opinion that the Section applies only where the person who gives the guarantee or furnishes security is a third party, that is, not a party to the suit. Mr. Andhyarujina has strongly urged that this view is not correct after the 1976 Amendment to the C.P.C In fact, he contended that the Section prior to the said Amendment read in the relevant portion “where any person has become liable as surety……………………..”. This portion was substituted by the amendment and the Section now reads “Where any person mas furnished security or given a guarantee…………………”. This change was, according to the learned counsel, meant to enlarge the application of S. 145 and to bring within its ambit any person, including a party to the suit who had furnished security or given a guarantee. This construction of S. 145 does not appear to be correct, for, as rightly pointed out by Mr. Setalvad, if that was so, the expression “and such person shall be deemed to be a party within the meaning of S. 47” occurring in S. 145 and which implies that the said person is not a party to the suit, would have been given a different wording, namely “and such person, if not a party to the suit shall be deemed to be a party within the meaning of S. 47”. I am, therefore, of the view that S. 145 applies only when security is furnished or guarantee is given by a third party and not by a party to the suit.
17. On this above ground alone, the enforcement of the Bond executed by the respondents was not possible under the provisions of S. 145 C.P.C But, in addition, there are other reasons to make unavoidable to the petitioners the recourse to Section 145 to enforce the Bond. The said provision of law, indeed, clearly implicates that the liability of the person who furnishes or gives guarantee is created and fastened on such person by an Order of the Court. Therefore, there should be an order or decree for the payment of money to attract the provisions of S. 145 C.P.C I am fortified in this view by the rulings of the Allahabad and Calcutta High Courts in the cases of Mt. Khairunnissa Bibi v. Oudh Commercial Bank, Fyzabad (AIR 1933 All 269) (FB) and Smt. Kunja Moyee Dassi v. Akshoy Kumar Das (AIR 1961 Cal 43) (supra). It is necessary, as such, to consider the facts of the case before me for the purpose of seeing whether such order exists.
18. As already stated, the learned Civil Judge, Senior Division, Margao, while confirming the injunction ex parte granted by him, has directed the respondents to submit half yearly statements of the pellets exported and also to furnish “suitable security for the amount consisting in the difference between Rs. 1,375 per tonne and Rs. 3.35 per tonne in respect of all quantities exported till the final disposal of the suit” (sic). In compliance with this direction of the learned trial Judge, respondents executed on 11-6-1970, a Bond which in its operative part reads as under:—
“Now, therefore, in pursuance to the aforesaid Order of the Civil Judge, Senior Division, Margao, dated 18th April, 1970 passed in Civil Suit No. 46 of 1969 this Bond is executed on 11th day of June, 1970 by the said obligors whereby they undertake and bind themselves to pay to the Mormugao Port Trust, Mormugao Harbour the amount representing the difference between Rs. 1,375 and Rs. 3.35 per ton in respect of the pellets exported should the final disposal of the aforesaid Suit No. 46 of 1969 be decided against the obligors, and particulars whereof shall be furnished by the obligors to the Court in half yearly statements as required by the said order.”
The said Bond was produced in Court along with an application dated 12th June, 1970, praying that the same Bond be taken on file. By Order dated 15-6-1970, the learned trial Judge ordered the said Bond to be filed and appears to have been accepted by him, since in his Order dated 3rd February, 1976, which disposes of an application of the petitioners praying that sufficient security should be given instead of the Bond, he specifically observed that:— “the Bond executed by the plaintiffs has been accepted by the Court”. These being the relevant facts, it is apparent that, though a “suitable security” was directed to be furnished for the purpose of safeguarding the interests of the petitioners and though the respondents undertook and bound themselves to pay the differential amount of the rates which would accrue till the final disposal of the suit, no order for the payment was expressly made by the trial Court, or if that matters, by the High Court. It was however contended by Mr. Andhyarujina that, by accepting the Bond executed by the respondents, the Court has incorporated the terms thereof in its order and hence, an implied order to pay exists. Reliance was placed in the rulings of the Calcutta and Lahore High Courts in the cases of Harendra Kumar Ghosh v. Gurupada Bhowmick, AIR 1937 Cal 452 and Parkash Chand Mahajan v. Madan Theatres, Ltd., AIR 1936 Lah 463 in support of this submission. In the aforesaid case of Harendra Kumar Ghosh v. Gurupada Bhowmick, the Calcutta High Court has held the view that an application for execution against the sureties is an application for execution of a decree as by operation of S. 145, Civil P.C, the sureties become judgment-debtors under the decree. And in the case of Parkash Chand Mahajan v. Madan Theatres Ltd. the Lahore High Court held that a decree against a judgment-debtor can be executed against his surety who has, by means of a statement made before the Court, undertaken to satisfy the liability of the judgment-debtor. These two authorities in no manner help the case of the petitioners, since it is not held therein that no order for payment is necessary. I am unable to agree with the proposition of the learned counsel. In fact, only because the learned trial Judge ordered the Bond to be filed and accepted it, one cannot infer that he incorporated the terms of the Bond in his Order of acceptance thereof and impliedly ordered the payment of the difference of rates. The said order of acceptance of the Bond warrants naturally and at the most the conclusion that the learned trial Judge was satisfied that the Bond executed constituted a “suitable security”, as required by him in his Order dated 18th April, 1970. This being the case, I find that there was no order of the Court directing the respondent to pay the said difference in export rates of the pellets and, consequently, for this reason also, I hold that the provisions of Section 145 Civil P.C were not available to the petitioners to enforce the undertaking given or the Bond executed by the respondents.
19. The next contention of the learned counsel for the petitioners has been that even if the Bond is not enforceable under S. 145 C.P.C, the court must, in the exercise of its general and inherent powers, enforce it. He urged that the Bond executed by the respondents embodies an undertaking to the Court and being a proceeding in Court, imposing a liability to be enforced in the suit against the plaintiffs/respondents herein, it was the duty of the Court to enforce such undertaking by using its inherent powers. He further argued that the said Bond is not addressed to anybody, contrary to what is required under Forms II or III of the Appendix G to the Civil P.C and, as such, the Bond and the undertaking are to the Court, being a fact that it was filed in Court and forms part of the record of the suit. Such Bond was given as a security for the difference between the rates of Rs. 1,375 and Rs. 3.35 per tonne, a difference that the petitioners could not collect as a result of the injunction Order dated 18-4-1970 and, in the circumstances, is to be enforced in the exercise of inherent powers by the Court, lest it will discredit it. And to strengthen his above submissions, the learned counsel placed reliance on the rulings of the Privy Council in Sadasiva Pillai v. Ramalinga Pillai, (1875) 2 Ind App 219 and Raj Raghubar Singh v. Jai Indra Bahadur Singh, AIR 1919 P.C 55, of the Madras High Court in Sankunni Variar v. Vasudeva Nambudripad, AIR 1926 Mad 1005, Kunhi Moidin v. Kunhi Koman Nair, AIR 1933 Mad 691 and Muthuswami Pillai v. Manikka Moopan, AIR 1936 Mad 990, of the Travancore-Cochin High Court in Ouseph Korathu v. Gopalan Nair, AIR 1952 Travancore-Cochin 237 and of the Kerala High Court in Krishnan v. Dorarajan Chettiar, AIR 1980 Kerala 234.
20. It is not necessary to make a detailed reference to the above authorities relied upon by Mr. Andhyarujina. It suffices to say that in all those cases there was an undertaking given to the Court to do something should the suit be decided against the party who had given the undertaking. In each of the said cases, the Courts consistently and firmly held that, though the undertaking could not be enforced under S. 145 Civil P.C and in the case of Sadasiva Pillai v. Ramalinga Pillai (above) under S. 11 of the Act XXIII of 1861, the same had to be enforced by the Court by exercising its inherent powers. Mr. Setalvad sought to distinguish the above authorities from the case before me. He contented that, unlike what happens in our case, no remedy was available to the parties in those cases to enforce the undertaking and hence, the Courts had felt it necessary to take recourse to inherent powers. He further urged that, as held by a Full Bench of the Allahabad High Court in Mt. Khairunnissa Bibi v. Oudh Commercial Bank, Fyzabad, AIR 1935 All 269, the proper remedy is to file a suit. These submissions of Mr. Setalvad however have, in my view, no force. First of all, the authority of Khairunnissa Bibi is clearly not applicable to our case, since therein the Bond, unlike the Bond executed by the respondents, was not given to the Court. Secondly, the ratio behind the above authorities of the Privy Council, Madras, Travancore-Chochin in Kerala High Courts is that in the event an undertaking is given to the Court, the decree-holder or the Court should not be compelled to file a separate suit to get the undertaking executed, and thus, it is not correct to say that the enforcement of the Bond was ordered in exercise of inherent powers only because, in the cases before the said Courts, there was no other way to enforce the undertaking. I am fortified in this view by the observations made in Sankunni Variar v. Vasudeva Nambudripad, AIR 1926 Mad 1005 to the effect that:—
“It would be a very roundabout proceeding to compel either the Court or the decree-holder, both of whom have been prejudiced by the conduct of the sureties, to proceed by way of a separate suit. The Court should itself order the execution of its own order for security in the original proceedings rather than tell the successful party to file another suit. There is no reason why a valuable right given to a holder of security should be frittered away by the hazards and delays of another separate suit.”
21. Undoubtedly, the Bond executed by the respondents was given to the Court and it embodies a clear undertaking given to the Court to pay to the petitioners the difference in the rates of export of pellets should the suit be finally decided against them, original plaintiffs. This flows from the circumstances in which the Bond was given, the manner of its execution and other attendant facts. Indeed, the Bond was given in compliance with the order of the learned trial Judge to safeguard the interests of the petitioners and to suitably guarantee the payment of the difference of the pellets export in the event the suit was decided finally against the respondents. It was not executed in the manner or in the form prescribed in the Appendix G to the Civil P.C, namely it was not addressed to somebody. Finally, it was, on the application of the respondents themselves, filed in and accepted by the Court, being a part of the records of the Suit No. 46/1969. This being so and since the acceptance thereof by implication shows that the learned trial Judge was satisfied that such Bond constituted a “suitable security” as required by him to guarantee the payment of the difference of pellets export rates, it cannot be gainsaid that the undertaking and the Bond were given and executed to the Court. The said “suitable security” was ordered by the learned trial Judge to be given, while confirming the ex parte injunction, for the purpose of restraining the petitioners from recovering the enhanced rates and from acting under the provisions of S. 59 and 61 of the Major Port Trusts Act, 1963. The respondents undertook and bound themselves to pay the difference in the disputed rates of pellets export should the suit be finally disposed against them. Now, since the Suit No. 46/1969 was disposed of and its final outcome is against the respondents, the latter cannot turn round and refuse to satisfy the solemn undertaking given to the Court, forcing thereby the petitioners, who had been prejudiced in not collecting the enhanced rates, to file a separate suit with all the hazards and delays. Further, the valuable rights given to the petitioners by such undertaking cannot be taken away, making them to face, in a fresh suit, a case that the claim for differential amount between the disputed rates is barred by limitation. Hence, in a situation like this, it is obvious that the Court has to enforce the undertaking without recourse to a separate suit and by exercising its inherent powers. As aptly observed by the learned Judge of the Madras High Court in Sankunni Variar's case (AIR 1926 Mad 1005) (above) it would be anomalous that when the Court has granted indulgence to the judgment-debtor upon terms, that Court should not be able to enforce those terms without recourse to a separate suit, for otherwise, I may say borrowing the expression from Sadasiva Pillai's case (1875 2 Ind App 219) (above), the result would be “discreditable to the administration of justice”. In the view I have taken, I find therefore that by refusing to act in the exercise of its inherent jurisdiction to enforce the Bond and undertaking given by the respondents, the learned Civil Judge. Senior Division, Margao has failed to exercise a jurisdiction vested in him and this may cause a failure of justice and occasion an irreparable injury to the petitioners.
22. Mr. Setalvad however, contended that, in any event, the aforesaid Bond has ceased to subsist on the day the suit was decreed by the learned trial Judge, that is, on 31st March, 1978. He argued that the said Bond, having been given in pursuance of the injunction Order dated 18th April, 1970, came to an end and became unforceable after 31st March, 1978, being a fact that the petitioners did not make any effort to keep such Bond alive. Reliance was placed in support of this contention in the decisions of the Calcutta High Court in Ram Chand v. Pitam Mal, 10 Indian Law Reporter 506 (ILR 10 All 506?) and Yamin-ud-Dowlah v. Amed Ali Khan (1894) ILR 21 Cal 561. This submission has obviously no force. In fact, it is common ground that, after the passing of the judgment dated 31st March, 1978, the petitioners preferred an appeal against the said judgment and decree. This appeal was allowed on 21st March, 1983 by a Division Bench of this Court and the Special Leave Petition filed by the respondents in the Supreme Court was dismissed. The respondents bound themselves and undertook to pay the difference of rates should the suit be decided finally against them. Now, it is well settled that the appeal is a continuation of the suit and, hence, in the circumstances, it would be totally erroneous to accept the view of Mr. Setalvad. It may also be pointed out that the authorities relied upon by the learned counsel in this connection are not attracted, since unlike in our case, there were no Bonds or Securities given until the final disposal of the suit, and that, in any case, upon the ordinary principles of estoppel, the respondents cannot now take the stand that they are not liable for the amount they undertook to pay under the said Bond.
23. In this view of the matter, this revision application succeeds. In the result, therefore, the impugned Order dated 21st December, 1983 passed by the learned Civil Judge, Senior Division, Margao is set aside and it is ordered that the learned Judge, in exercise of its inherent powers, should look into the application filed by the petitioners for the enforcement of the Bond executed by the respondents and of the undertaking given by them in the Suit No. 46/1969 to pay the differential amount between the rates of Rs. 1,375 and Rs. 3.35 and, thereafter, dispose of the said application in accordance with law. Costs by the respondents.
24. Mr. Tamba, learned counsel appearing for the respondents seeks for a certificate of fitness to appeal to the Supreme Court. Since no substantial law of general importance arises, the certificate of fitness is refused.
Revision allowed.
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