TARACHAND SHIVLAL Vs. CHANDIRAM GANGA SAHAI

JUDGEMENT

(1.) THIS second appeal arises out of the execution of a compromise decree in a suit which was brought for the recovery of Rs. 4,850. According to the compromise the Defendants were to pay Rs. 1,900 only but of which they paid Rs. 100 in cash; they promised to pay Rs. 1,800 in four instalments of Rs. 450 each on the following dates:

(2.) THIS was followed by a clause providing that in case of default in payment of any two consecutive instalments, the Plaintiffs would be entitled to a further sum of Rs. 500. The dispute in this second appeal is only with regard to this amount of Rs. 500. The Courts below have held that the decree -holders were entitled to recover the amount of Rs. 500 because it was in the form of a concession and not penalty.

(3.) THE learned District Judge has relied on a decision in Chimma v. Chunnilal and Anr. AIR 1967 Raj 378. In my opinion that case is distinguishable. There the suit was for a larger amount, but a compromise was struck at Rs. 1,700 to be paid on certain specified dates with a stipulation that in the event of default of payment of any instalment on the stipulated date, the decree -holders would be entitled to recover the entire amount sued for. From these terms it appears that in fact the Plaintiff's whole claim was admitted, but a concession was given to the Defendant. I have already said that here only Rs. 1,900 were agreed to be paid as the agreed amount and it follows that the stipulation to pay Rs. 500 in default was a penalty.