PETITIONER: MAHENDRA SINGH JAGGI ETC. Vs. RESPONDENT: DATARAM JAGANNATH DATE OF JUDGMENT: 15/01/1997 BENCH: A.S. ANAND, S.B. MAJMUDAR ACT: HEADNOTE: JUDGMENT:
(WITH VICE VERSA)
THE 15TH DAY OF JANUARY, 1997
Present:
Hon’ble Mr.Justice A.S. Anand
Hon’ble Mr.Justice S.B. Majmudar
In-person and Ranjit Kumar, Adv. for the appellants in
C.A.No. 156 and 158/97
J U D G M E N T
The following judgment of the Court was delivered:
WITH
(C.A. No. 157 of 1997 (arising out of S.L.P (C) No. 12429 of
1990): and C.A. No. 158 of 1997 (arising out of S.L.P. (C)
No. 6392 of 1995]
J U D G M E N T
S.B. Majmudar. J.
Leave granted in all these special leave petitions.
By consent of parties the appeal arising from these
special leave petitions were heard finally and are being
disposed of by this judgment as common questions are raised
for our consideration in these appeals.
The appellant in appeals arising out of S.L.P. (C) No.
10981 of 1987 and S.L.P. (C) No. 6392 of 1995 is Mahendra
Singh Jaggi, party-in-person who was also permitted to be
assisted by advocate Shri Ranjit Kumar who was good enough
to appear amicus curise for him at out request, we express
out deep sense of appreciation for the service rendered by
Shri Ranjit Kumar at out instance. We will refer to the
appellant in these tow appeals as defendant and the
contesting respondent as the plaintiff. In appeal arising
out of S.L.P. (C) No. 12429 of 1990 the plaintiff is the
appellant while the defendant is the contesting respondent.
Disputes between the plaintiff and the defendant which
have culminated in the present proceedings before us are
spread over years and represent a chequered history. At the
outset we may briefly indicated the background facts
leading to the present proceedings.
The plaintiff filed a civil suit in 1961 in the Court
of First Additional Subordinate Judge, Guttack against the
defendant for realisation of Rs. 10723.63 (Principal amount
of Rs. 9385.09 plus interest Rs. 1938.54 10% p.a.) on khata
account. According to the plaintiff he was a financier and
had advanced moneys from time to time to the defendant for
enabling him to carry on his motor spare part business,
According to the plaintiff the suit amount was failing due
at the foot of account. In the suit the defendant raised a
counter-claim in his additional written statement claiming
certain amounts after taking accounts from the plaintiff in
respect of goods which came into his possession in pursuance
of a agreement. The Trial Court decreed the plaintiff’s suit
against the defendant but also accepted the cross-claim of
the defendant for accounts and passed a preliminary decree
for accounts to be rendered by the plaintiff for the goods
lying in his custody. The Trial Court observed that the
details of the decree would be worked out in the final
decree. The plaintiff carried the matter in appeal so far as
preliminary decree for accounts was concerned. Defendant
also appealed against the money decree passed in favour of
the plaintiff. Defendant’s appeal was dismissed by the High
Court. Defendant did not challenge that appellate order any
further. Thus money decree passed against the defendant
became final but the plaintiff’s appeal against the
preliminary decree for accounts as passed against him in
favour of the defendant was allowed by the High Court. It
set aside that part of the judgment and decree of the Trial
Court which directed the plaintiff to tender accounts and
dismissed the cross-claim made by the defendant in his
additional written statement. The defendant, who was
respondent in plaintiff’s appeal, carried the matter in
further appeal before this Court. A three member Bench of
this Court speaking through S.M. Sikri, C.J. allowed the
appeal of the defendant and restored the preliminary decree
of accounts as passed in his favour by the Trial Court and
directed the Trial Court to proceed further for passing
final decree in accordance with law. The aforesaid decision
of this Court is reported as Mahinder Singh Jaggi v. Data
Ram Jagannath AIR 1072 Sc 1049. Pursuant to the preliminary
decree for accounts as passed in favour of the defendant and
against the plaintiff by this Court the final decree
proceeding the accounts as appointed by the Trial Court
submitted his Report which was not acceptable to both the
sides. After considering their objections to the Report
ultimately the Trial Court passed a final decree for
accounts in favour of the defendant awarding Rs. 5,268/-
with profit at 10% as recommended by the aforesaid
Commissioner, The defendant challenged the said final decree
before the High Court in First Appeal No. 17 of 1077. The
total claim put forward by the defendant in the said appeal
consisted of four items totalling to Rs. 47,478.86 as under:
(a) Value of the goods in the custody of the plaintiffs
15,589.86.
(b) Value of the goods released by the bank and received by
the plaintiffs on 13.8.1957 16,759.00
(c) increase in the rate of goods to the extent of
10,130.00
(d) Profit on the goods retained by the plaintiffs 5,000.00
Total 47,478.86
The learned Single Judge of the High Court by his
judgment and order dated 25th February 1987 allowed the
appeal and held that the defendant is entitled to Rs.
10,750/- from the plaintiff. He was also held entitled to
pendente lite interest @ 8% per annum on the aforesaid
amount and future interest from the date of the order at
commercial rate of interest at 10% per annum till the date
of recovery since the entire transaction was outcome of
business transaction. The defendant moved a Review Petition
No. 7 of 1987 which was dismissed on 7th July 1097. The
aforesaid decision rendered by the learned single judge in
First appeal no. 17 of 1977 is the subject-matter of appeal
arising out of S.L.P (C) No. 10981 of 1987.
The plaintiff on the other hand filed and appeal before
the Division Bench of the High Court being A.H.O. No.8 of
1987 against the order rendered by the learned Single Judge
in First Appeal no. 17 of 1977 insofar as the learned judge
had enhanced the decretal amount payable to the defendant.
The defendant on his part filed cross-objections in the said
A.H.O. No. 8 of 1997 pending before the Division Bench. The
Division Bench allowed the said A.H.O. partly to the extent
that increase in price granted by the learned Single Judge
of Rs. 5,000/- was set aside and the further rate of
interest granted to the defendant was scaled down form 18%
to 12%. So far as the cross-objections filed by the
defendant were concerned the Divisions filed by the
defendant were concerned the Division Bench did not go into
the cross-objections in view of the pendency of Special
Leave Petition (C) No. 10981 of 1987 before this Court. The
defendant thereafter preferred a review petition against the
order of the Division Bench of the High Court dated 18th
August 1993. The Division Bench by order dated 20th October
1994 dismissed the review petition on account of pendency of
the Special Leave Petition before this Court. The Judgements
rendered by the Division Bench dated 10th August 1990 and
20th October 1994 are brought in challenge by the defendant
in Civil Appeal arising out of S.L.P. (C) No. 6302 of 1995.
The defendant in the meantime sought to execute the
final money decree as passed in his favour against the
plaintiff by filling execution proceedings before the
Executing Court. The Plaintiff by an application under Order
21 Rule 19 Code of Civil Procedure (CPC) sought to get
adjusted against the defendant’s detrital claim his own
decretal amount in the suit. The Executing Court rejected
the said application as not maintainable. The plaintiff
carried the matter in revision being Civil Revision No. 299
of 1000 before the High Court. The High Court rejected the
said Revision Application on 9th July 1990. This order of
the High Court is made the subject-matter of appeal by the
plaintiff in Civil Appeal arising out of S.L.P. (C) No.
12429 of 1990.
We have heard the learned advocate for the plaintiff
and learned advocate Sri Ranjit Kumar for the party-in-
person as well as the party-in-person in these appeals in
support of their respective contentions. The following point
fall for our determination.
1. What is the appropriate amount which should be granted
to the defendant in the final decree for accounts
against the plaintiff.
2. Whether the plaintiff in entitled to adjust his
decretal dues against the defendant’s decretal amount
as found due and payable to the defendant by the
plaintiff as per the provisions of Order XXI Rule 19,
CPC.
As directed by our order dated 2nd December 1996
parties were permitted to file written submissions within
tow weeks, Shri Ranjit Kumar, Learned counsel for the party-
in-person appellant-defendant has filed written submission.
As noted earlier the defendant-appellant olaimed in all
Rs. 47,479.99 from the plaintiff on four items (a) to (d)
listed in paragraph 8 of the impugned judgment. The first
item refers to Rs. 19,590,90 pertaining to the value of the
goods in the oustoday of the plaintiff. The learned Single
Judge has held the said amount to have been proved by the
defendant, It is fount well established on record that the
plaintiff had received goods of the value of Rs. 97142.22
and they were kept in pledge by the plaintiff. These goods
admittedly belonged to the defendant. The learned single
judge has also fund that out of the said value of goods,
goods of the Value of Rs. 11552,97 were already received
back by the defendant. Thus the goods of the defendant worth
the net value of the Rs. 15,589.95 remained with the
plaintiff. In paragraph 10 of the judgment it has been in
terms held by the learned judge accepting the Report of the
commissioner that he plaintiff received the goods as per
Exts, W/9 to W/20 from the defendant towards pledge. Having
so held the learned Judge has refused to pass decree against
the plaintiff for the aforesaid value of the goods which
remained with the plaintiff by observing that the defendant
had not adduced any evidence as whether the goods worth Rs.
11,552.97 were out of the goods received by plaintiff on
13th August 1957. This amount is to be deducted out the
admitted case the defendant was not paying any amount for
release of the goods. The plaintiff had paid the amount of
Rs. 15,589.86. Having so observed the learned Judge has
though it fit not to award any amount to the defendant on
this item. It is difficult for us to defendant on this team.
It is difficult for us to appreciate how the value of these
goods which remained with the plaintiff though they belonged
to the defendant could not have been accounted for by the
plaintiff. It has to account in view that the plaintiff’s
suit on the foot of account in already decreed against the
defendant and that decree had become final. Therefore, the
plaintiff had nothing ore to claim against the defendant
towards his dues pertaining to the transaction of advance of
money by the plaintiff to the defendant. Once that aspect is
kept in view it becomes obvious that in the cross-claim of
the defendant which was to be adjudicated upon on taking
accounts as directed by this Court in Mohinder Singh Jaggi
(supra) the value of the goods of the defendant which were
not returned to him by the plaintiff had to be awarded to
the plaintiff. We therefore, set aside that part of the
order of the learned Single Judge by which he refused to
grant decree or Rs. 100,000.00 to the defendant on claim
item (a) and decree his amount in favour of the defendant,
So far as claim item (b) is concerned it pertains to
Rs. 19,750/-, So far as this amount is concerned the learned
Judge in paragraph 8 of the judgment has in terms observed
that on 19th August 1997, the plaintiff received the goods
worth Rs. 19,750/- and kept the same pledged with him. It is
not in dispute between the parties that these goods belonged
to the defendant, However the learned Single Judge in
impugned judgment was pleased not to grant the full amount
of Rs. 10,750/- to the plaintiff on item (b) but granted
only Rs. 9,750/- by deduoting Rs. 10,000/- by way of amount
of money paid by the plaintiff to the bank for releasing
these goods from the bank on behalf of the defendant. So
far as this deduction of Rs. 10.000/- is concerned it was
not is dispute that it was advanced by the plaintiff to the
defendant by way of paying it on his behalf to the bank. But
his amount was already taken not of by the Trial Court while
passing decree in favour of the plaintiff against the
defendant on foot of account as noted earlier. That decree
has become final. since the amount of Rs. 10,000/- was
already part and parcel of the decree passed in favour of
the plaintiff against the defendant the said amount payable
to the defendant in connection with the value of the goods
released by the bank and received by the plaintiff on 10th
August 1997 as indicated in claim them (b). It had to be
kept in view that the evidence on record showed that Rs.
10,000/- was the first advance paid to the bank on 19th
August 1997 by the plaintiff and this amount along with
other claim of the plaintiff was decreed in total by the
Trial Court. The plaintiff’s claim on this basis as found in
para 7 of the plaint and as reiterated in plaintiff’s
evidence clearly established this fact. The learned Trial
Judge in this connection had noted in his judgment that the
defendant’s own stand was sufficient to accept the
correctness of the plaintiff’s account both on credit and
debit side. In this connection Trial Court had noted further
as under :
“The defendant has cogently
explained that out of such sum
payable to the bank the plaintiffs
financed to the extent of Rs.
10,000/- and the balanced he repaid
in cash vide the pass books of the
defendant. EXT. B and B/1 the pass
books of the defendant disclose
that thereafter the cash credit
system of the defendant mainly
continued by the finance from the
plaintiffs till 11th September,
1057 when this cash credit pass
book was closed from Bank and on
that very day this defendant opened
the current account book by
supplementing of funds from the
plaintiffs which have been
mentioned, as the money passed
always through the bank. There is
no counter evidence to disclose
that the cash credit system of the
defendant any longer continued and
therefore the defendant continued
as before but the bank was
substituted by the plaintiffs as
financial concern and the
circumstances are such the
plaintiffs could never have parted
with so much money without the
pledge of goods as the Bank did.”
On the basis of the aforesaid finding the learned Trial
Judge had decreed the plaintiff’s suit on contest with post
against the defendant with interest of 8%. Thus the amount
of Rs. 10,000/- paid by the plaintiff to the bank for
releasing the defendant’s goods which were earlier pledged
with the bank was already taken care of and was made the
subject-matter of an item resulting in the money decree in
favour of the plaintiff and against the defendant.
Thereafter at the stage of taking accounts regarding
defendant’s goods lying with the plaintiff value of which
was to be decreed in favour of the defendant as per his
cross-claim, there remained no oppasion for the court to
again deduct Rs. 10,000/- from the value of the goods which
was to be made good by the plaintiff to the defendant as per
claim item (b) otherwise it would amount to double deduction
in favour of the plaintiff. We, Therefore, find that the
learned Single Judge in the impugned judgment had committed
an ed facie error in once again deducting Rs. 10,000/- from
the value of the goods received by the plaintiff on 19th
August 1957 totalling to Rs. 18,750/-. In short instead of
Rs, 8,750/- the entire claim of Rs. 18,750/- was required to
be decreed in favour of the defendant as per claim item (b).
we accordingly do so.
So far the claim item (d) is concerned in our view on
fault can be found with the reasoning edopted by the learned
Single Judge of the High Court that some guess work had to
be done about the profit which might have accrued to the
defendant on this claim as price was gradually rising and
there was no evidence that the price of the articles
remained statio or the articles lost their commercial value,
In absence of any clear-out evidence on this aspect instead
of remanding the matter and prolonging the agony of parties
guess work of Rs. 5,000/- was made by the learned Single
Judge and Rs. 5,000/- were awarded towards increase in the
rate of goods kept by the plaintiff. consequently on claim
item (8) the appellant had made out no case for any increase
above Rs. 5,000/- as awarded by the learned Single Judge. On
the other hand the Division Bench of the High Court in
A.H.O. No. 8/97 was not justified in rejecting this claim in
the impugned judgment in appeal arising out of S.L.P. (C)
No. 6392. The Division Bench had observed that they were not
fully satisfied about grant of this amount. If that is so
the matter ought to have been remanded instead of being
rejected outright, In our view, however, an amount of Rs.
5,000/- as awarded on this item by the learned Single Judge
remained well justified on the record of the case and called
for no interference by the Division Bench.
So far as claim item (d) is concerned it pertains to
profit on the goods retained by the plaintiffs. Rs. 5,000/-
are already awarded in full by the learned single judge.
That appears to be well justified on the record and the
Division Bench in A.H.O. no. 8 of 1997 has also ponfirmed
the said finding of the learned Single Judge. Therefore, on
this them nothing further is required to be stated. As a
result of the aforesaid disoussion the appellant-defendant
in addition to the final decree of Rs. 16,750/- as awarded
by the learned Single Judge will be entitled to an
additional amount as under :
Claim Item (a) 15,589.86
Claim Item (b) 10,000.00
———
Total 25,589.86 ==========
To this amount to be added Rs. 16,750/- which amount
was already granted by the learned Single Judge and which is
upheld by us. thus total amount payable by plaintiff to the
defendant as per the final decree will amount to Rs.
42,348.88. The defendant will also entitled to pendents
light interest @ 8% per annum on the total amount of Rs.
40,348.88 upto the date of the decree of the learned Single
Judge and future interest thereon from the decree of the
learned Single Judge dated 20th February 1007 @ 12% per
annum till realisation of the entire decratal amount by the
defendant from the plaintiff. We are inolined to reduce the
future interest from 25th February 1987 as awarded by the
learned Single Judge from 10% to 12% agreeing with the
reasoning adopted by the Division Bench of the High Court
Court in A.H.O. of 1997 as the relationship between the
plaintiff and the defendant was not merely of a lender and
borrower, but there was an agreement similar to the cash
credit arrangement with the bank and as the bank rate of
interest at the relevant time was 12% Consequently Civil
Appeal arising out of S.L.P. (C) No. 10001 of 1997 and Civil
Appeal arising out of S.L.P. (C) No. 6392 of 1995 will stand
partly allowed as aforesaid and in the place and instead of
the final decree passed by the learned Single in First
Appeal No. 47 of 1077 and modified by the Division Bench of
the High Court in A.H.O. No. 8 of 1097, there anall be a
final decree against the plaintiff respondent had in favour
of the appellant-defendant in the total sum of Rs. 42248.88
with pendente lite interest thereon @ 6% per annum till the
date of the learned Single Judge’s judgment dated 25th
February 1997 and thereafter @ 12% per annum on the
aforesaid amount till realisation. The orders passed by
the learned Single Judge in Civil Review No. 7 of 1987 on
7th July 1987 and in Misoellaneous Case No. 127 of 1989 and
Misoellaneous Case No. 155 of 1993 by the Division Bench of
the High Court on 8th October 1997 will also stand set aside
in view of the aforesaid final decree as ordered to be
passed by us.
That takes us to the consideration of Civil appeal
arising out of S.L.P (C) No. 12429 of 1990. The appellant –
plaintiffs have felt aggrieved by the order of the learned
Single Judge dismissing their Revision Application No. 226
of 1990. That Revision Application arose out of an order
dated 9th March 1990 passed by the learned Subordinate
Judge, first court, Cuttack in Execution Case No. 82 of
1991. A few introductory facts leading to the present appeal
deserve to be reoapitulated at this stage.
On 16th March 1984 the appellants obtained decree for
Rs. 10720.88 with interest @ 8% per annum and costs against
the defendant-respondent. The defendant, as noted earlier,
had filed a cross-claim claiming preliminary decree for
accounts against the plaintiff, The Trial Court passed the
said preliminary decree as prayed for by the defendant.
Plaintiff and the defendant both went in appeal in the High
Court, Defendant’s appeal against plaintiff’s money decree
was dismissed. Plaintiff’s appeal against the preliminary
decree in favour of the defendant was allowed on 5th August
1070. As seen earlier, the defendant did not challenge the
money decree passed in favour of the plaintiff by the Trial
Court and as confirmed by the High Court. But he challenged
the appellate order vacating the preliminary decree in his
favour as passed by the Trial Court. As noted earlier this
Court by its decision in the case of Mohinder Singh Jaggi
(supra) reversed the said decision of the High Court and
restored the preliminary decree for accounts in favour of
the defendant.
The appellant sought execution of his money decree
against the defendant. That Execution Petition was
dismissed, The respondent. That Execution petition was
dismissed, The respondent on the order hand sought to
execute the final accounts decree as passed in his favour by
the Trial Court and as modified by the learned Single Judge
of the application under Order XXI Rule 10 seeking
adjustment of his decretal amount against the decree-holder
defendant’s claim as awarded in the final decree. That
application came to be rejected by the Executing Court. The
said order came to be confirmed by the High Court in
revision as per the impugned judgment. In our view no fault
can be found with the reasoning adopted by the learned
Single Judge dismissing the application of the appellant.
The reason is obvious. Order XXI Rule 10 reads as under:
R.19. Execution in case of cross-
claims under same decree. Whether
application is made to a Court for
the execution of a decree under
which two parties are entitled to
recover sums of money from each
other, then.
(a) if the tow sums are equal
satisfaction for both shall be
entered upon the decree; and
(b) if the two sums are unequal,
execution may be taken only by the
party entitled to be larger sum and
for so much only as remains after
deducting the smaller sum, and
satisfaction for the smaller sum
shall be entered upon the decree.”
For its applicability it must be shown by the party
seeking relief thereunder that he is entitled to recover a
sum of money under the very same decree Which is sought to
be executed by the other side. The words ‘application for
execution of a decree under which tow parties are entitled
to recover sums of money’ in the opening part of the Rule
clearly indicate that there should be two rival claims by
contesting parties against each other arising out of the
very same decree with is sought to be executed by one of the
parties against the other party. In the present case it is
not the submission of the appellant that he is awarded any
amount under the very final decree for accounts which the
defendant seeks to execute against the appellant. On the
contrary his claim arises out of a money decree against the
defendant which has become final. The defendant does not
seek to execute that money decree as nothing in awarded to
the defendant under that decree against the plaintiff, what
is awarded to the defendant is under a final decree on
taking accounts between the parties. Through of course both
these decrees are passed in the same suit, each of them is a
separate decree, One is a money decree obtained by the
plaintiff against the defendant. Another is a final accounts
decree passed in favour of the defendant against the
plaintiff in defendant’s cross-claim which is analogous to
a cross-suit. Under these circumstances, therefore,
applicability of O.XXXI R. 10, CPC was already ruled out,
whatever remedy the appellant may have for execution of his
money decree against the defendant will have to be pursued
independently, The High Court has observed that the
appellant’s Execution Petition against the defendant has
been dismissed as time barred. Be that as it may. The short
question which has been posed for our consideration in
present proceedings is whether the plaintiff could have
resorted to provisions of O.XXI R.10, CPC for getting his
claim under the money decree adjusted against the
defendant’s final accounts decree against him, such an
effort on the part of the appellant-plaintiff was clearly
contra-indicated by the express wording of O.XXI R. 19. CPC
as rightly held by the High Court, it may also be noted that
both the decrees, that is, plaintiff’s money decree against
the defendant and the defendant’s final decree against the
plaintiff were also not passed at the same time but were
passed at different times as noted hereinabove. That was an
additional reason why. XXI R.10, CPC was rightly not held
applicable to the facts of the application’s case by the
High Court. For all these reasons this appeal fails and is
dismissed.
In the result Civil Appeal arising out of S.L.P. (C)
no. 1001 of 1997 and Civil Appeal arising out of S.L.P (C)
No. 8392 of 1995 are partly allowed as aforesaid while Civil
Appeal arising out of S.L.P. (C) No. 12429 of 1000 is
dismissed. In the facts and circumstances of the case there
will be no order as to costs in all these appeals, Order
accordingly.