BISHNATH SAHU Vs. PRAYAG DIN

JUDGEMENT

(1.) The facts of the case, which have given rise to this reference may be briefly stated. Prayag Din obtained a money decree No. 491 of 1946 against Ram Achal from the Court of the Munsif Banaras. Ram Achal appealed to the District Judge and prayed for the stay of execution of the decree. The learned Judge ordered the stay of execution provided the appellant furnished security in the sum of Rs. 1750/-. Bishwanath Sahu stood surety and gave security of his house mentioned in the security bond dated 16th of Januury, 1949. The appeal was dismissed. In execution of the decree the decree-holder prayed that the decretal amount be realised by the sale of the house given in security. Bishwanath Sahu objected, inter alia, on the ground that the security bond not being registered was invalid and unenforceable. The learned Munsif accepted that contention of Bishwanath Sahu and rejected the prayer of the decree-holder to the effect that the decretal amount be realised by sale of the house given in security. The decree-holder preferred an appeal which was decided on 16th of August, 1954 by the Addl. Civil Judge of Banaras. The Addl. Civil Judge was of the view that the security bond accepted by the Court was exempt from registration under Section 17 (2) (vi) of the Registration Act and, therefore the decree-holder could proceed against the property that was covered by the bond. An Ex. Second Appeal was then preferred by Bishwanath Sahn in this Court. It came up before a learned single Judge who on account of some conflict of decisions upon the question as to whether such a bond was compulsorily registrable or not, has referred the following question of law to this Bench for opinion. The question formulated is : whether a bond by which immovable property is given in security is invalid and unenforceable if it is not registered under the Indian Registration Act?

(2.) There is, no doubt, a difference of opinion as to whether a security bond, executed in favour of the Court hypothecating immovable property as security for the due fulfilment of a condition imposed by a Court by an order, is required to be registered. Cases decided by different Courts may be classified in two heads--the one which deal with Order 41, Rule 5 of the Code of Civil Procedure and the other which deal with Section 17 of the Provincial Small Cause Courts Act. The proviso to Section 17 (1) of the Provincial Small Cause Courts Act says that an applicant for an order to set aside a decree passed ex parte or for a review of judgment shall, at the time of presenting his application, either deposit in the Court the amount due from him under the decree or in pursuance of the judgment, or give such security for the performance of the decree or compliance with the judgment as the Court may, on a previous application made by him in this behalf, have directed.

(3.) Order 41, Rule 5 of the Code of Civil Procedure provides that :