ANNAMALAI CHETTIAR Vs. VTCHETTIAR FIRM

JUDGEMENT

(1.) The respondent in these appeals obtained a decree against Alagappa Chettiar and the members of his family in the Rangoon High Court and got it transferred to the Devakottai Sub- Court for execution. On the application of the decree-holder in E.P. No. 359 of 1933, the Sub- Court ordered arrest, and Alagappa Chettiar was brought to the Court under arrest on 24th October 1933. On that day he filed two documents. One was a counter to the E.P. denying that he was liable under the decree in that (1) he was not a partner of the firm, although his father was, and (2) that he received no notice of the application to transfer the decree for execution to the Sub-Court of Devakottai. He also filed E.A. No. 1309 of 1933 praying for release from arrest and stay of execution until his objections to the execution petition had been disposed of. He added a further prayer that if the Court deemed itself debarred from going behind the decree of the High Court, it should stay execution until he could get a stay from the Rangoon High Court. On the same day the present appellant appeared and offered to stand surety for Alagappa Chettiar if the Court would release him from arrest. The Court thereupon adjourned Rule A. No. 1309 of 1933 and E.P. No. 359 of 1933 to 5 January 1934 to get a stay from the Rangoon High Court or to consider the objections and dispose of the petition. The question that arises in these appeals is whether the appellant is still liable under the surety bond. The important words by which the appellant made himself liable are: If ha (Alagappa Chettiar) is released from the said warrant, I hereby agree to produce him at any time required by this Hon ble Court till the said objections are heard and decided and till the disposal of the petition which has been filed praying for stay; and in case orders are passed against him in the two matters set forth above, I further agree to produce him subsequent to that at any time fixed by this Hon ble Court; and if I fail to produce him as stated above I and my heirs further agree to pay the decree amount of this suit from and out of my moveable and immoveable properties.

(2.) The grounds on which the appellant seeks to escape liability under this bond are these: On 21 December 1933 a stay order was received from the Rangoon High Court in these words: "Let execution be stayed pending the application", the application in question being the one by Alagappa Chettiar to set aside the order that was ex parte, so far as he was concerned, transferring the decree for execution against him from Rangoon to Devakottai. On 26th January 1934, E.P. No. 359 of 1933 and E.A. No. 1309 of 1933 were called and the Rule P. was endorsed, "The application may be renewed after stay is vacated". Then comes a symbol which is said to mean "dismissed". On the Rule A. the endorsement is "E.P. has been dismissed. Petition dismissed". On 26 November 1934 the Rangoon High Court dismissed the application by Alagappa Chettiar and so the stay became automatically dissolved. On 14th July 1934 the present appellant filed E.A. No. 676 of 1934 to cancel the surety bond on the ground that his liability ceased when the E.P. and E.A. were dismissed on 26 January 1934. That application was dismissed and so the surety has filed C.M.A. No. 551 of 1934. On 4th January 1935 the respondent decree-holder filed Rule P. No. 6 of 1935 for execution against defendant 6, Alagappa Chettiar, adding under his name the name of the appellant. The prayer was that in view of the fact that the Rangoon High Court had on 26 November 1934 dismissed the petition of Alagappa Chettiar to set aside the ex parte order and that the stay was thereby cancelled, the surety (appellant) may according to the terms of his bond be ordered to produce Alagappa Chettiar before the Court, and that if he failed to do so, the appellant should be ordered to pay the decree amount in accordance with the terms of the bond, and in default should be arrested and sent to jail. In view of the order passed in E.A. No. 676 of 1934, the Court naturally ordered execution to proceed and against that order the surety has filed C.M.A. No. 84 of 1935.

(3.) The main argument adduced on behalf of the appellant is that it must be presumed that he stood surety for Alagappa Chettiar only for the pendency of Rule P. No. 359 of 1933, and that he could nob possibly be liable indefinitely until such time as the decree, holder thought fit to proceed against him. Mr. Patanjalai Sastri has quoted a number of cases in which various High Courts have held that when an execution petition has been dismissed for default, any subsequent proceedings are entirely distinct from the proceedings in respect of the prior execution petition that was dismissed, and that the surety could only have contemplated becoming so for the appearance of the judgment, debtor during the proceedings that were then pending and not for proceedings that had not then even been contemplated. We are not prepared to disagree with the principle laid down in these cases; but they differ in an important respect from the proceedings we are now considering. When a petition is dismissed for default, it naturally comes to an end; and the argument that the surety could not have considered proceedings which were not in the contemplation of even the principal parties is a very sound one. In Kali Ram V/s. Umrao Singh AIR 1934 Lah 92 and Kashmiri Lal V/s. Chuni Lal AIR 1934 Lah 319, the dismissed petitions were restored to file and the Judge who decided these cases held that the surety was not liable after the petition was restored. I however doubt very much whether these decisions can be held to be good law, at any rate in Madras. In Veeraswamy V/s. Ramanna AIR 1935 Mad 365, a Full Bench case of this Court, a surety furnished security for the decree amount pending disposal of the suit. The suit was dismissed for default but later restored on an application by the plaintiff. It was held that with the restoration of the suit all the ancillary proceedings must be deemed to be restored also and that the surety bond must therefore be deemed to have been restored with the restoration of the suit. This very sound reasoning would apply equally well to execution proceedings. A case, where the execution petition was dismissed and not restored, presents no difficulties. The important distinction between the present case and those above quoted is that in this case the petition was not dismissed for any fault on the part of the decree-holder; it was dismissed merely because there had been a stay order from the Rangoon High Court and because the Subordinate Judge was not willing to keep the Rule P. and Rule A. on the file indefinitely. This would appear from the expression, used in dismissing the E.P. "The application may be renewed after stay is vacated." There is no justification for an order of this sort. It is clearly not one passed under Order 21, Rule 57, Civil P.C., for any default, nor can it be said to be an order passed under Section 47, Civil P.C., which provides for the determination by the Court of all questions arising between the parties to the suit in which the decree was passed. The nature of the order passed by the learned Subordinate Judge is well understood, especially in this Presidency, as one passed for administrative or statistical purposes, so that the Subordinate Courts shall not be called in question by the High Court for having a large pendency of applications. The Court which passes such an order and the parties and their pleaders all understand it as being equivalent to an order adjourning the petition sine die. It is usual to revive the proceedings by the filing of a fresh E.P. properly stamped, and it is not usual in such an E.P. to state definitely that it is in renewal of the prior E.P.; but the decisions of this High Court have made it quite clear that it is in fact a renewal of the prior E.P., provided of course that the nature of the proceedings is the same as in the E.P. that has been dismissed for administrative or statistical purposes, or such as to necessitate a revival of the earlier E.P. If on the other hand, the reliefs asked for in the two Rule P.s have no necessary connexion, the later would not revive the earlier. A later B.P., for example, applying for arrest, would not ordinarily revive one praying for attachment or some entirely different relief. A paragraph from Pattannayya V/s. Pattayya AIR 1926 Mad 453 illustrates the attitude of this Court towards petitions of this nature: In Subba Chariar V/s. Muthuveeran Pillai (1913) 36 Mad 553, Benson and Abdur Rahim, JJ. follow the decision of Miller and Munroe, JJ. in Chalavadi Kotiah V/s. Poloori Alimelammal (1908) 31 Mad 71. The principle of these oases is that if an execution application is pending, a subsequent application is not an application under Art. 181 but an application asking the Court to continue the proceedings in a pending application. The decision in Ayissa Umma V/s. P.K. Abdulla AIR 1924 Mad 178, to which one of us was a party, is in point. It was held in that case that an order of dismissal of an execution petition for statistical purposes did not amount to a dismissal of the petition but that the petition should be considered as pending.