DHANI RAM GUPTA Vs. LALA SRI RAM

JUDGEMENT

(1.) Rattan Lal sold certain land to Sri Ram for Rs. 10,000/- under a registered sale deed dated 31st March, 1960. On April 4, 1960 Sri Ram executed an agreement to reconvey the property for a sum of Rs. 15,000/- if paid within a period of two years. Rattan Lal filed suit No. 18 of 1961 in the Court of First Additional Civil Judge, Meerut for specific performance of the agreement to reconvey and obtained a decree on April 17, 1962. The decree was confirmed in appeal by the High Court of Allahabad on September 5, 1963. On April 25, 1963 Rattan Lal assigned the right which he had under the decree in favour of the present appellants, Dhani Ram Gupta and another. The appellants filed an application for execution of the decree under Order XXI, Rule 16 of the Code of Civil Procedure on December 10, 1963. Notice of application was issued to Sri Ram, the judgment-debtor as well as the original decree-holder Rattan Lal, Rattan Lal kept quiet but on March 7, 1964, the judgment-debtor Sri Ram filed objections contending that the execution application was not maintainable. The application was adjourned from time to time. Meanwhile, on May 26, 1964 Rattan Lal the original decree-holder and Sri Ram, the judgment-debtor moved the Executing Court to record full satisfaction of the decree. It was stated that the parties had entered into a compromise and that the decree was proposed to be satisfied by payment of a sum of Rs. 7,000/- in cash by the judgment-debtor to the original decree-holder. The amount was paid in open Court and satisfaction of the decree was duly recorded on May 27, 1964 by the Executing Court, who, however, observed that the compromise would not have 'any effect whatsoever' on the rights, if any, of Dhani Ram, who had already filed an execution application pursuant to the deed of assignment dated April 25, 1963. Thereafter, the execution application filed by the appellants was taken up and was dismissed on October 9, 1964, on the ground that the assignee had no right to execute the degree after the judgment-debtor had satisfied the original decree-holder by entering into a compromise with him. On appeal the learned Additional District Judge, Meerut held that the appellant assignees had the right to execute the decree and that their right could not be defeated by collusive compromise entered into between the judgment-debtor and the original decree-holder subsequent to the date of assignment and with notice of assignment. One of the contentions raised before the learned Additional District Judge was that the so called deed of assignment did not fact have the effect of assigning the decree to the appellants. That contention was also negatived by the learned District Judge. On further appeal to the High Court by the judgment-debtor, it was held that the assignee of the decree had no right to execute the decree until the assignment was recognised by the Court. Until that was done, it was held, it was open to the original decree-holder to put the original decree-holder to put the decree in execution; it was also open to the judgment-debtor to satisfy the decree fully by payment to the decree-holder or by other adjustment. The High Court however, did not express any opinion on the question whether the deed of assignment did assign the right of the decree-holder to the appellants. The assignees of the decree have preferred this appeal after obtaining special leave under Article 136 of the Constitution.

(2.) Even the bare statement of the facts is sufficient to show how the original decree-hold colluded to deprive the appellants of their rights under the deed of assignment and now the Executing Court tacitly gave its seal of approval by permitting satisfaction of the decree to be entered despite the fact that the decree had already been assigned to the knowledge of the judgment-debtor. The process of the Court cannot be reduced to a mockery and we do not think that the procedure prescribed by the Code of Civil Procedure permits this to be done notwithstanding the argument of Shri D. V. Patel and Shri Govind Dass, learned Counsel for the judgment-debtor to the contrary, in support of the judgment under appeal. Their submission was that the assignee of a decree had no rights until the assignment was recognised by the Court. In substance, the submission of the learned counsel was that it was the recognition by the Court that completed the assignment and gave the right of the assignee to execute the decree.

(3.) Let us examine if the provisions of the Code of Civil Procedure justify the submission of the learned counsel. Section 2 (3) defines "decree-holder" as meaning "any person in whose favour a decree has been passed or an order capable of execution has been made". Section 51 provides that the Court may, on the application of the decree-holder order execution of the decree by various methods. Section 146 provides that where any proceeding may be taken or application made by or against any person, then the proceeding may be taken or the application may be made by or against any person claiming under him. Order XXI of the Code of Civil Procedure deals with execution of decrees and orders and Order XXI, Rule 2 in particular provides for payment or adjustment out of Court and for the recording of satisfaction of the decree by the Court in whole or in part as the case may be. Order XXI, Rule 16 with which we are primarily concerned is as follows: