N V E NACHIAPPA CHETTIAR Vs. NAKSUBBIER

JUDGEMENT

(1.) Early in 1917 the 1 respondent Subbiar brought a suit, O.S. No. 566 of 1917, in the Court of the District Munsif of Periyakulam against Kumaraswami Mudali. In March, 1917 he attached before judgment certain piece-goods, the property of the defendant. They were sold and the proceeds deposited to the credit of this suit on April 11, 1917. The present appellant Nachiappa Chettiar brought a suit in the same Court against the same defendant, O.S. No. 678 of 1917, and on April 14, 1917 attached before judgment the money in deposit in Sub- bier's suit. He got a decree on April 19, 1917 and on June 7, 1917 he applied in Subbier's suit for payment out to him of the money in Court. While this application was pending Subbier got a decree on July 2, 1917 and on July 3 applied for payment out to him, or, as it is called, applied for cheque. The present 2nd and 3 respondents, Rangaswami Aiyar and Sundara Rao, brought suits in the same Court against the same defendant, O.S. Nos. 617 1917 and 785 1917, and obtained decrees and applied for payment out to them, one on June 29, that is, before Subbier's application, and the other on July 10th, that is, after Subbier's application. Subbier first got an attachment before judgment and the money was deposited to the credit of his suit, but Nachiappa Chettiar and Rangaswami Aiyar got decrees and applied for payment out of the money to them before Subbier got his decree, while Sundara Rao got his decree and applied for payment out after Subbier got his decree and applied for payment.

(2.) The question for determination is which of these four plaintiffs is entitled to be paid. The question depends upon the interpretation of Section 73, C.P.C. which is in the following terms: "Where assets are held by a Court and more persons than one have, before the receipt of such assets, made application to the Court for the execution of decrees for the payment of money passed against the same judgment-debtor and have not obtained satisfaction thereof, the assets, after deducting the costs of realisation, shall be rateably distributed among all such persons." The District Munsif held that as none of the other three had applied before the receipt of the assets into the Court in Subbier's suit, that they had no right to rateable distribution under Section 73 and refused their application, and ordered that Subbier should draw the whole amount, but stated that his order did not preclude the rival decree-holders from setting up their rights, which would have to be determined in a suit. The matter then came up on Civil Revision Petition before Bakewell, J. and he held following Umma Venkatarat- nam and Co V/s. Adamp Usman and Co (1919) I.L.R. 42 M. 692, that NachiappaChettiar being the first decree-holder to apply for payment was entitled to the money. On the Letters Patent Appeal from that order Sadasiva Aiyar, J., held following Visvanathan Chetti V/s. Arunachalam Chetti (1921) I.L.R. 44 M. 100, that Section 73 applied to the first three decree-holders and awarded rateable distribution amongst them. Coutts Trotter, J., differed and proposed to follow Bakewell, J. and held that the petitioner Nachiappa Chettiar ought to be given preference. Owing to this difference of opinion the matter now comes before us under Section 15 of the Letters Patent. In Umma Venkataratnam and Co. V/s. Adamji Usman and Co. (1919) I.L.R. 42 M. 692 and in Bisheshar Das V/s. Ambika Prasad (1915) I.L.R. 37 All. 575 it was decided in similar circumstances that the person entitled is the first decree-holder who applied to the Court in which the money is deposited, on the same principle as is applied in the case of an ordinary judgment-debtor's property in his own possession, namely, the first in order of time has the preference.

(3.) The whole matter was however re-considered in Visvanathan Chetti V/s. Arunachalam Chetti (1921) I.L.R. 44 M. 100 by a Full Bench of this Court and the proper interpretation of Section 73 was laid down. The Court was unanimous. It was held that "assets held by a Court" did not include all money lying in Court to the credit of the judgment-debtor but only the assets levied in execution or paid into Court in satisfaction of the decree under execution, and that there is no receipt of assets within the meaning of Section 73 until the Court holding the money comes to the conclusion that no objection exists, and orders the money to be transferred to the credit of the first attaching creditor's suit, the decree in which it is engaged in executing. This is the effect of the judgment of Wallis, C.J., with which Ayling, J., and Napier, J. agreed. Sadasiva Aiyar, J. held that the words "before receipt of such assets" must be qualified by an implication of the words "levied in the course of execution and paid into Court in satisfaction of any of the decrees under execution, or transferred for purposes of execution to the credit of one or more of the decrees under execution." Krishnan, J. put it that only when the money is transferred to the credit of the suit in which attachment takes place can the attaching Court be said to have received the assets and hold them within the meaning of Section 73, and that the decree-holders who have attached prior to that are entitled to rateable distribution. In view of this decision in my judgment Umma Venkataratnam and Co. V/s. Adamji Usman and Co. (1919) I.L.R. 42 M. 692 and Bisheshar V/s. Ambika Prasad (1921) I.L.R. 44 M. 100 cannot here be considered as good law. In this case the money in Court has never been levied in execution or transferred to the credit of any other suit than Subbier's and did not become available as assets held by the Court under Section- 73 until an order was made on the application by Subbier for execution of his decree. Under Order 38, Rule 11 he, having attached before judgment, was excused firm applying for re-attachment in execution, and there being already other applications to the Court for attachment of this money in execution of decrees against the same judgment-debtor, the amount in Court should have been rateably distributed between these applicants. In this case the persons entitled to rateable distribution are Subbier, Nachiappa Chettiar and Rangaswami yler. The 4 decree-holder Sundara Row has not appealed, and it is not necessary to consider his claim, and he must be excluded.