MAHOMEDALLI IBRAHIMJI Vs. LAKSHMIBAI ANANT PALANDE

JUDGEMENT

(1.) This is a Letters Patent Appeal against the summary dismissal of the appeal from the decision of the District Judge of Poona who reversed the decision of the Extra-Joint Subordinate Judge, Poona, in Darkhast No. 211 of 1925. Shortly put, the facts of the case are as follows: In Suit 192 of 1924 the plaintiff applied for an order for attachment before judgment. The deceased, one Anant Wasudeo Palande, stood surety for the defendant under Civil Procedure Code, Order XXX.VIII, Rule 5. He executed a bond in Form 6 to Appendix F to the Code. On April 12, 1924, the plaintiff and the defendant arrived at a compromise which was subsequently recorded as an adjustment of the suit and a decree passed in terms thereof by the Extra-Joint Subordinate Judge. The compromise allowed the judgment-debtor to pay the amount by instalments of Rs. 200 per month. The first instalment was payable on May 12, 1924, the second on Jane 12, 1924, and the decree further provided that in default of payment of two instalments the plaintiff might recover the whole amount due. The question before us is whether by this compromise the surety has been discharged.

(2.) Mr. Thakor for the appellant contends that it is immaterial whether the decree was passed on a compromise or whether it was arrived at after adjudication by the Court. He maintains that the surety is not discharged under the compromise decree. Turning to Form 6 in Appendix F, it is not absolutely clear whether the words "may adjudge" mentioned in the concluding part of the form refer to the adjudication of the Court on the claim or the adjudication of the Court on the value of the property which the opponent has failed to produce when required. I doubt, however, whether the words were intended to permit an inquiry into the value of the property so as to reduce the security for its production in case of its non- production. Presumably any question of the value of the property would have been considered when the amount of the security was fixed. Nor is part performance by the defendant by producing only part of the property ordered to be produced a performance pro tanto by the surety of his guarantee. If the words refer to the adjudication of the claim by the Court then, with great respect to the decisions to the contrary, I would be inclined to say that a decree passed on a compromise is not usually an adjudication contemplated by the surety. It is not an ordinary incident of the suit like an arbitration through the Court where (see 2nd Schedule, Clause 16, of the Civil P. C.) the Court pronouncea judgment. Section 2, Clause (9), of the Civil Procedure Code, shows that a "judgment" implies a controversy. Section 2, Clause (2), of the Civil Procedure Code, no doubt says that a decree is the formal expression of an adjudication but the words Court may adjudge" in Form 6, Appendix F, mean, I think, that the Court is to be the arbitrator not that it is merely to decree what the parties consent to. The adjudication required in a decree by Section 2(2) may be taken as inferring that a consent decree means that the order on the compromise is an adjudication but it does not necessarily define the meaning of the word "adjudge" in Form 6. The Court cannot refuse to record a compromise of the suit (Order XXIII, Rule 8) and it seems to me stretching the meaning of the word "adjudge" to say that where this power is taken away from the Court it has adjudged the dispute.

(3.) However, the appeal may, we think, be decided on another ground. Now, whether Section 135 of the Indian Contract Act applies to the case of a bond passed to the Court or not and it must be noted that the relation of debtor and creditor did not exist between the plaintiff and the defendant when the bond was executed I see no reason why the equitable principles underlying Section 1133 should not be applied in this case.