Sadasheo Appa Wani v. Punjabrao

1. The applicant Sadasheo Appa obtained a decree for payment of money in Civil Suit No. 84 of 1928 against Punjabrao and Wamanrao, non-applicants 1 and 2. Similarly Hemraj, Narayandas and Hazarimal, non-applicants 3 to 5, together and Balkrishna and Dhondo non-applicants 6 and 7, together, obtained decrees against the same judgment-debtors respectively in Civil Suits Nos. 93 of 1928 and 50 of 1924. Sadasheo Appa actively prosecuted execution proceedings, whereas the other two sets of decree-holders applied for execution and claimed rateable distribution under Section 73 of the CPC. The execution proceedings were pending before the Collector. Sadasheo Appa purchased on 4th July 1930 the judgment debtors' fields which were put to auction and deposited the purchase money in Court. Thereon the judgment-debtors, with the permission of the Court privately sold some out of the fields purchased in auction by Sadasheo Appa and deposited the amount payable to Sadasheo Appa on his decree with 5 per cent as compensation in accordance with O. 21, B. 89. On receipt of the Collector's report the lower Court, Sub-Judge First Class, Morsi, ordered ??? distribution of the amount among the three sets of decree-holders. Sadasheo Appa, who claimed the entire amount for himself, has moved this Court in revision.

2. The applicant Sadasheo Appa claims priority over the decree-holders on the ground that the amount having been voluntarily deposited in Court for satisfaction of his own decree, it could not be treated as “assets held by the Court” so as to be available for rateable distribution under Section 73 of the CPC.

3. It is also contended that the deposit resulted in the removal of Sadasheo Appa's attachment under which alone the other decree-holders' claims were enforceable. Reliance is placed on Sorabji Coovarji v. Kala Raghunath [1912] 36 Bom. 156 , 12 I.C 911 and Harai Saha v. Faizlur Rahman [1913] 40 Cal. 619 , 18 I.C 839.

4. It may be readily conceded that the payment of the decretal amount in Court resulted in setting aside the sale held at the instance of Sadasheo Appa, but I fail to see how it would make the attachment inoperative. This contention seems to be quite foreign to the case and does not merit serious consideration. The real point for determination is whether the money deposited can be regarded as assets held by the Court within the/meaning of Section 73 of the CPC. The case of Sorabji Coovarji v. Kala Raghunath, [1912] 36 Bom. 156 , 12 I.C 911 is distinguishable on facts. In that case the judgment-debtor deposited the decretal amount with incidental costs in Court under O. 21, R. 55 of the CPC. It was held that the money deposited was not available for rateable distribution among other decree-holders who had applied for execution. The reason was that the money in deposit was not regarded as assets within the meaning of Section 73 of the CPC, as it was not realized in course on execution but was voluntarily paid by the judgment-debtor. The view propounded in this case was criticized in Nathmal v. Maniram A.I.R 1919 Bom. 152 , 53 I.C 599 , 21 Bom. L.R 975. Pratt, J., observed as follows at p. 978 (of 21 Bom. L.R):

“I venture to doubt whether this is not too restrictive a construction under the amended section in which the words sale or otherwise have been dropped and in which there is merely an implication that the assets should have been realized or obtained in execution proceedings.”

5. The scope of Section 73 of the CPC, will be evident on a comparison with the corresponding provisions of the old Codes of 1882 and 1859. Under S. 270 of the Code of 1859 the decree-holders were only entitled to priority in the order of their attachment. The principle of rateable distribution was for the first time introduced in S. 295 of the Code of 1882. In Section 73 of the CPC, 1908, the words “where assets are held by the Court” have been substituted for the words “whenever assets are realized by sale or otherwise in execution of a decree” which occurred in S. 295 of the Code of 1882, and the words “before receipt of such assets” have been substituted for the words “prior to the realization.” The present S. 73 does not lend validity to the view that the money realised by the Court under pressure of execution is alone capable of a rateable distribution and not that which is voluntarily paid by the judgment-debtor in the course of the execution proceedings. “Assets held by the Court” is an expression which is wide enough to cover such money as comes into the custody of the Court otherwise than by a coercive process. The Bombay High Court has recently dissented from the view enunciated in Sorabji Coovarji v. Kala Raghunath [1912] 36 Bom. 156 , 12 I.C 911 and gave effect to the view taken in Nathmal v. Maniram A.I.R 1919 Bom. 152 , 53 I.C 599 , 21 Bom. L.R 975, in Indaji v. Cooverji A.I.R 1926 Bom. 242 , 98 I.C 852. It is evident that the authority of Sorabji Coovarji v. Kala Raghunath [1912] 36 Bom. 156 , 12 I.C 911 is exhausted even in the Bombay High Court.

6. The recent view of the Calcutta High Court has also been against it. In Ghisullal Agarwdlla v. Todarmull Agarlwalla A.I.R 1922 Cal. 19 , 70 I.C 539 their Lordships of the Calcutta High Court expressed their dissent from Sorabji Coovarji v. Kala Raghunath [1912] 36 Bom. 156 , 12 I.C 911 and ruled that the words “assets held by the Court” should not receive narrow or limited construction. In Noor Mahomed Dawood v. Bilasiram Thakursidass A.I.R 1920 Cal. 785 , 59 I.C 458 , 47 Cal. 515 at p. 520 (of 47 Cal.) Rankin, J., exhaustively dealt with the point in these words:

“I see no support in these considerations or in the section of the rule for a theory grounded upon the ‘voluntariness’ of the payment into Court. This is, think out of place as regards payments into Court under stress of execution. Such payments, if made to the decree-holder, may and indeed must be regarded as accord and satisfaction made by the parties, thus bringing the decree to the position of a satisfied decree. But if made into Court under O. 21, they cannot without anomaly be treated otherwise than as the results of an execution would be treated. The debtor is allowed to arrive at the same result by means less distressing to him but there is no difference in the result, because the debtor chooses the more convenient means. The money paid with whatever motive, if paid to the Court, is paid upon terms of the Code whatever they may be. These terms, as I read S. 73, have been laid down so that distinctions in the form in which execution has been had, in the precise extent to which execution has been allowed to run, in the exact source or genesis of the fund in Court, are now no part of the definition of the assets that are subject to the distribution rateably. The object of the new Code in using larger language can only be to avoid anomaly. To introduce a distinction on the strength of the voluntariness of the payment or the purpose of the debtor, is I think to out down the language and intention of the Code upon a principle which is inapplicable to the subject-matter and which if applicable is very difficult to imply.”

7. It would thus appear that the view taken in Harai Saha v. Faizlur Rahman [1913] 40 Cal. 619 , 18 I.C 839 is no longer held to be authoritative.

8. In the Madras High Court also their Lordships expressed their dissent from Sorabji Coovarji v. Kala Raghunath [1912] 36 Bom. 156 , 12 I.C 911 in Thiraviyam Pillai v. Lakshmana Pillai [1918] 41 Mad. 616 , 47 I.C 538. Although R. 89, O. 21, specifically mentions payments to the decree-holder, it cannot be interpreted so as to make the money of not available for rateable distribution, since it is only an intimation to the judgment-debtor as to the amount he is to pay for the purpose of getting the sale set aside. If the auction-purchaser deposits the purchase money in Court, there is no question that it is available for distribution among the various decree-holders. One fails to see why if the decretal amount was voluntarily paid by the judgment-debtor or with a view to set aside the sale, that money could not be rateably distributed only because the judgment-debtor voluntarily pays the money into Court. Whatever money is realized in execution at the instance of one decree-holder becomes assets held by the Court within the meaning of Section 73 of the CPC, for the benefit of all decree-holders who have applied for execution before the receipt of the assets. Of course if the judgment-debtor satisfies the claim of the active decree-holder privately, that is, without making any deposit in Court, the question is different.

9. The order for rateable distribution passed by the lower Court is therefore correct. The application is dismissed with costs. Pleader's fees Rs. 25.

P.N/R.K

10. Application dismissed.