SUNDEEP INDUSTRIES Vs. COLLECTOR OF CUSTOMS

JUDGEMENT

(1.) THE only surviving issue in this execution petition is as to whether out of the amount of Rs. 1,84,904. 52 deposited by the judgment debtor in this court, the decree holder is entitled to a sum of Rs. 66,578. 17 only as contended by the judgment debtor or to the entire amount as contended by the decree holder. The answer to the said issue depends upon whether the deposits made by the judgment debtor in the court after filing of the execution petition are to be appropriated first towards interest as contended by the decree holder or first towards the principal amount as contended by the judgment debtor, Tf the appropriation is towards the interest first, then the decree holder is entitled to the release of the entire sum of Rs, 1,84,904. 52. However, if the appropriation is towawds the principal first then the decree holder is entitled to the release of Us. 06. 578. 17 only.

(2.) AN ex parte decree dated 22nd August, 2003 was passed in favour of the decree holder for recovery of Rs. 22,64,564/- together with pendente lite and future interest @ 9% per annum from the date of institution of the suit till the date of realization. Costs of Rs. 35,653. 57 were also awarded to the decree holder. The decree holder filed this execution stating that as on 16th october, 2003 a sum of Rs. 41,00,545. 95 was due under the decree. The judgment debtor, on notice of the execution being issued, first deposited a sum of Rs. 22,64,564/- in this court as recorded in the order dated 21st May, 2004 in the execution. This amount was the exact amount of which the decree was passed besides interests and costs. However, on 21st May, 2004 when it was informed that the said amount had been deposited, it was not stated that the deposit was under any particular head. The order dated 21st may, 2004 itself directs the judgment debtor to deposit the balance decretal amount. Thereafter, a further sum of Rs. 18,35,982/- was deposited by the judgment debtor in the court. On the submissions of the decree holder that the sum of Rs. 1,84,904. 54 remains outstanding on the decree, warrants of attachment for the said amount were issued towards the same. The amount was deposited by the judgment debtor in the court subject to the determination instant. The counsel for the judgment debtor has urged that upon the judgment debtor depositing the entire principal amount of Rs. 22,64,564/- before the court on 12th February, 2004, notwithstanding the judgment debtor having not deposited the remaining decretal amount which was towards interest and costs only, further interest ought to stop running and as such besides the amount mentioned in the decree only the sum of Rs. 66,578. 17 more was due to the decree holder towards interest till the date of deposit. Reliance in this regard is placed on Nandi Investments and enterprises v. L. M. Saravamangala AIR 2004 SC 4765. However, the said judgment after recording the submissions of the parties remanded the matter to the High Court for fresh adjudication and is of no help to the judgment debtor. The counsel for the decree holder has on the other hand placed reliance on Gurpreet Singh v. Union of India (2006) 8 SCC 457, mathunni Mathai v. Hindustan Organic Chemicals Ltd. (1995) 4 SCC 26 and Meghraj and Ors. v. Mst. Bayabai and Ors AIR 1970 SC 161.

(3.) AT first blush it appears that reference in Order 21 Rule 1 and Order 24 CPC to odeposito has to be reference to deposit of principal amount only since interest runs on the same only and question of cessation of interest on deposit of interest amount, which does not incur any further interest, does not arise. However, a Five Judges Bench of the Apex Court in Gurpreet singh (supra) has extensively analyzed the provisions of Order 21 Rule 1 and Order 24 of the CPC and have held in para 26 as under: