Bayyana Ramayya vs Nidamarthi Krishnamurthi And … on 11 January, 1916

Madras High Court
Bayyana Ramayya vs Nidamarthi Krishnamurthi And … on 11 January, 1916
Equivalent citations: 32 Ind Cas 952
Bench: S Aiyar, Moore


1. The appellant, who had obtained transfer of a decree against the 1st respondent and others, applied under Order XXI, Rule 16, Civil Procedure Code, for execution and to be recognized as transferee. The application was opposed by the 3rd defendant (1st respondent) on the ground that the transfer was benami and that the decree had been satisfied by the 1st defendant paying the decree amount to the original plaintiff.

2. The finding of the lower Appellate Court was that the appellant did not pay any consideration for the transfer, and that, being only a benamidar for, the 1st defendant by whom the decree amount had been paid, the Court could not recognise the appellant as transferee-decree-holder.

3. The only point argued in this appeal is that, as the payment was not certified to the Court, Order XXI, Rule 3, Civil Procedure Code, operates as a bar to the 1st respondent’s plea of no title in the appellant, and that the 1st respondent was not entitled to prove the alleged uncertified payment.

4. We have been referred to Ponnuswami Nadar v. Letchmanan Chettiar 12 Ind. Cas. 657, 35 M. 659; 10 M.L.T. 442; (1911). 2 M.W.N. 568; 22 M.L.J. 170, a case which is in some respects similar to the present one, in which the learned Judges Abdur Rahim and Sundara Aiyar, JJ., differed as to the scope of Order XXI, Rule 2.

5. Mr. Justice Abdur Rahim held that, if the arrangement alleged amounts to an adjustment of the decree and is not certified to the Court, it cannot be pleaded as a bar to execution, and that an assignment is nonetheless an adjustment or satisfaction of the decree because it is obtained in the name of another person as a mere benamidar for the judgment-debtor.

6. On the other hand, Mr. Justice Sundara Aiyar was of opinion that Rule 2 of Order XXI, Civil Procedure Code, does not disentitle the judgment-debtor to prove facts which will show that the applicant is not the real transferee, even if the facts he relies on show that the decree has been adjusted.

7. Speaking with respect, it appears to us that the view taken by Sundara Aiyar, J., as to the applicability of Order XXI, Rule 2, Civil Procedure Code, is the correct one, and that the section merely forbids effect being given to an uncertified payment when it is set up as a defence to an application of the execution of decree and when such application is made by a person who is admitted or proved to be the legal owner of the decree rights, the question of payment towards or adjustment of the decree being left out of consideration for the moment, while deciding the question of the legal ownership in the applicant of the right to execute the decree. In other words, the alleged transferee has first to prove his right under the transfer set up by him, and it is only after he has done so that the question of adjustment of the decree arises.

8. In so agreeing with Sundara Aiyar, J., we should add that we do not agree with the very wide observations found in Agra Bank v. Cripps 8 M. 455 and Mon Mohan Karmakar v. Dwarka Nath Karmakar 7 Ind. Cas. 55 12 C.L.J. 312 (two of the cases referred to by Sundara Aiyar, J., in his judgment) to the effect that uncertified payments can be treated as discharging a decree even when the subsequent transferee of the decree is a transferee for value.

9. Strictly speaking, it was not necessary for the 1st respondent to do more than allege that the appellant was not the real transferee in order to defeat the appellant’s claim to execute the decree and the addition of the allegation that the decree had been legally satisfied might be treated as surplusage. The rule provides that a Court executing a decree shall not recognise a payment or adjustment which has not been certified for any purpose whatsoever. It seems to apply to cases where it is contended that the decree having been satisfied is not executable and no question arises as to whether the applicant is the decree-holder or not. In this case, the applicant’s right as transferee was denied by the 1st respondent. We think that the Subordinate Judge was right in holding that the applicant was not entitled to apply to execute the decree on the basis of an assignment in respect of which he is a benamidar for one of the judgment-debtors. In Annabattula Venkataratnam v. Annabattula Nayudu 28 Ind.Cas. 906, Sankaran Nair and Spencer, JJ., express the opinion that when the alleged transferee of a decree is found to be the benamidar of the judgment-debtor, the Court “was bound by the second proviso to Order XXI, Rule 16, to refuse to allow the decree to be executed” in favour of the alleged transferee. This decision supports the view of Sundara Aiyar, J., above referred to.

10. The appeal is dismissed with costs.

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