Allowed

Maddineni Hanumantha Rao v. The Mandal Revenue Officer

Telangana HC6 Dec 2014CRP/1191/2010

Case brief

AI extract

What is this about?

The High Court allowed a civil revision petition challenging an execution court order. The court held that the impugned order was liable to be set aside because parties failed to follow the correct legal position on appropriation of payments and subsequent interest. The matter was remitted for fresh disposal with liberty to file correct calculation memos.

What did the court decide?

Impugned order set aside relating to the petitioner; matter remitted to Court of execution for fresh disposal after filing correct calculation memos by both parties.

Maddineni Hanumantha Rao Vs The Mandal Revenue… — Execution and Attachment | Telangana HC (2014)

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THE HON’BLE SRI JUSTICE M.SEETHARAMA MURTI

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Civil Revision Petition No.1191 of 2010

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ORDER:

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This civil revision petition under Section 115 of the Code of Civil Procedure, 1908 (‘the Code’ for short) by the petitioner/4^th Decree Holder is directed against the order dated 30.11.2009 of the learned Senior Civil Judge, Addanki made in EP.No.24 of 2003 in LAOP.No.5 of 1987.

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2. I have heard the submissions of the learned counsel for the petitioner/4^th DHr and the learned Government Pleader for Arbitration appearing for the respondent. I have perused the material record.

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3. Now the points for determination are:

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1. Whether the petitioner/4^th DHr had made out valid and sufficient grounds for setting aside the order impugned?

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2. Having regard to the facts and circumstances of the case, what shall be the appropriate order to be made in this revision?

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4. POINTS:

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4. (a) E.P.No.24 of 2003 was filed by 11 decree holders including the present petitioner for realisation of the decree debts by attachment and sale of the EP schedule movable properties. All the decree holders who are eleven in number have mentioned the amounts specifically due to each decree holder under the Award. The total EP claim was Rs.12,02,880/-. All the decree holders claimed subsequent interest and also execution costs. The JDr had filed calculation memos in respect of individual claims of the decree holders and had deposited an amount of Rs.5,28,692/-. Thereafter the EP was referred to Lok Adalat for settlement and the matter was settled between some of the decree holders and the JDr. Another EP.15 of 2004 was also filed against the same JDr. Therefore, the amount of Rs.5,52,507/-

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was set apart as amount due under the EP.15 of 2004. The remaining amount which was deposited by the JDr was proportionately distributed amongst the decree holders. Except the petitioner/4^th DHr all the other decree holders had accepted the amounts apportioned proportionately to each of them from out of the amount deposited by the JDr. Out of the total EP claim amount, the petitioner/4^th DHr claim was said to be Rs.3,04,479/-. All the other decree holders who had accepted the amounts respectively apportioned to them had filed cheque petitions and received their respective amounts and had also filed full satisfaction memos. In respect of the remaining EP claims the JDr had deposited Rs.3,36,788.59 ps. However, the petitioner/4^th DHr disputed the amount deposited by the JDr towards his claim and therefore, in the execution petition what remained was the consideration of the claim of the petitioner/4^th DHr. While so, the petitioner/4^th DHr had filed a separate calculation memo. As per the calculation memo of the petitioner/4^th DHr, the amount due to him was Rs.3,06,725.25 ps. The JDr had disputed the calculation in the said memo and had filed a fresh calculation memo showing the entitlement of the petitioner/4^th DHr as Rs.1,57,127.52 ps. The Court of execution on merits had partly allowed the execution petition insofar as the petitioner/4^th DHr is concerned and directed the JDr to deposit Rs.1,17,724.11 ps within one month from the date of the said orders i.e., 30.11.2009. In the orders, the Court of execution had further directed that on failure of the JDr to do so, the EP schedule properties will be attached and sold. The aggrieved 4^th DHr, therefore, filed this revision.

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4. (b) In the grounds of revision and at the time of hearing, it is contended that the order of the Court below insofar as it related to the determination of the amount due to the petitioner/4^th DHr is irregular and illegal; and that the Court of execution erred in directing the petitioner/4^th DHr to file a fresh execution petition insofar as the subsequent interest is concerned though it is the duty of the Court to see that the entire amount with subsequent interest is realised by the petitioner/4^th DHr towards full satisfaction in the present EP only; and that the Court below had erroneously observed that the calculation filed by the petitioner/4^th DHr is not reflecting true facts; and that the Court below ought to have held that the calculation adopted in the memo filed by the petitioner/4^th DHr is correct and ought to have directed the JDr to deposit the said amount.

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4. (c) On the other hand, the learned Government Pleader supported the order impugned by stating that the Court of execution having correctly calculated the amounts due had passed the impugned orders and that the claim of the petitioner/4^th DHr that an amount of Rs.3,08,377 was due as on 27.07.2007 is incorrect and that since the Court below had directed in its orders that the petitioner/4^th DHr is entitled for subsequent interest as per rules from 21.12.2003 by filing a fresh Execution Petition no prejudice is caused to the petitioner and that the order impugned does not call for interference.

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4. (d) A plain reading of the order of the Court of execution and the contentions of the parties would show that the Court of execution had not considered the claim of the petitioner/4^th DHr in full and had relegated the claim of subsequent interest to a latter stage by observing in the impugned order as follows: -‘However, he is entitled for the subsequent interest as per rules from 21.12.2003 by filing a fresh EP’. It is fairly conceded before this Court that when once the EP is filed, the subsequent interest from the date of the execution petition till the date of realisation and the costs of the execution petition shall also be determined in the very same execution petition; and that the entire amount due including subsequent interest and execution costs form part of the claim in the EP and that the decree holder is entitled to realise the entire amount towards full satisfaction in the very same execution petition; and that the decree holder shall not be driven to file a fresh EP for subsequent interest; and that therefore, the direction of the Court of execution that the petitioner/4^th DHr is entitled for subsequent interest as per rules from 21.12.2003 by filing a fresh EP is contrary to law. On this ground alone the matter requires to be remitted to the court below for fresh consideration as per law. Be that as it may.

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5. During the course of hearing, on examination of the calculation memos filed by both the sides, it is noticed they are ambiguous and it is not clear from the calculation memos as to whether the appropriations of payments and the calculations of interest at various stages of the claim were properly and correctly made or not. The law is now well settled that if the amount deposited by the JDr falls short of the decretal amount, the decree holder is entitled to apply the rule of appropriation by appropriating the amount first towards interest, then towards costs and subsequently towards the principal amount under the decree. A constitutional bench of the Hon’ble Supreme Court in Gurupreet Singh v. Union of India dealt

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with the following questions in a land acquisition matter (i) Can a claimant or decree holder who has received the entire amount awarded by the reference Court or who had notice of the deposit of the entire amount so awarded, claim interest on the amount he has already received merely because the appellate Court has enhanced the compensation and has made payable additional compensation? (ii)What is to happen when a part of the amount awarded by the reference Court or by the appellate Court is deposited pursuant to an interim order of the appellate Court or of the further appellate Court and the awardee is given the liberty to withdraw that amount?; and had held as follows:

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“49. Though, a decree holder may have the right to appropriate the payments made by the judgment debtor, it could only be as provided in the decree if there is provision in that behalf in the decree or, as contemplated by Order XXI Rule 1 of the Code as explained by us above. The Code or the general rules do not contemplate payment of further interest by a judgment debtor on the portion of the principal he has already paid. His obligation is only to pay interest on the balance principal remaining unpaid as adjudged either by the Court of first instance or in the Court of appeal. On the pretext that the amount adjudged by the appellate Court is the real amount due, the decree holder cannot claim interest on that part of the principal already paid to him. Of course, as indicated, out of what is paid he can adjust the interest and costs first and the balance towards the principal, if there is a shortfall in deposit. But, beyond that, the decree holder cannot seek to reopen the entire transaction and proceed to re-calculate the interest on the whole amount and seek a re-appropriation as a whole in the light of the appellate decree.

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50…….

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51….

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52. What is to happen when a part of the amount awarded by the reference Court or by the appellate Court is deposited pursuant to an interim order of the appellate Court or of the further appellate Court and the awardee is given the liberty to withdraw that amount? In such a case, the amount would be received by the decree holder on the strength of the interim order and the appropriation will be subject to the decision in the appeal or the further appeal and the direction, if any, contained therein. In such a case, if the appeal is disposed of in his favour, the decree holder would be entitled to appropriate the amount already received by him pursuant to the interim order first towards interest then towards costs and the balance towards principal as on date of the withdrawal of the amount and claim interest on the balance amount of enhanced compensation by levying execution. But on that part appropriated towards the principal, the interest would cease from the date on which the amount is received by the

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awardee. Of course, if while passing the interim order, the Court had indicated as to how the deposited amount is to be appropriated, that direction will prevail and the appropriation could only be done on the basis of that direction.

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The Hon’ble Supreme Court had also considered one other question which is as follows: - ‘Whether in the light of the decision in Sunder’s case [(2001) 7 SCC 211] the awardee/decree holder would be entitled to claim interest on solatium in execution though it is not specifically granted by the decree?; and had held as follows:

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‘It is well settled that an execution Court cannot go behind the decree. If, therefore, the claim for interest on solatium had been made and the same has been negatived either expressly or by necessary implication by the judgment or decree of the reference Court or of the appellate Court, the execution Court will have necessarily to reject the claim for interest on solatium based on Sunder’s case (supra), on the ground that the execution Court cannot sgo behind the decree. But if the award of the reference Court or that of the appellate Court does not specifically refer to the question of interest on solatium or in cases where claim had not been made and rejected either expressly or impliedly by the reference Court or the appellate Court, and merely interest on compensation is awarded, then it would be open to the execution Court to apply the ratio of Sunder’s case (supra) and say that the compensation awarded includes solatium and in such an event interest on the amount could be directed to be deposited in execution. Otherwise, not. We also clarify that such interest on solatium can be claimed only in pending executions and not in closed executions and the execution Court will be entitled to permit its recovery from the date of the judgment in Sunder’s case (supra), (September 19, 2001) and not for any prior period. We also clarify that this will not entail any reappropriation or fresh appropriation by the decree-holder.’

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Therefore, in the case on hand, in view of the fact that the settled legal position was not followed by both the parties while filing their respective calculation memos, it follows that the matter requires reconsideration by the Court below after both the parties file fresh calculation memos by following the correct legal position applicable to the facts of the case.

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6. Viewed thus, this Court finds that the impugned order is liable to be set aside as the matter requires to be remitted to the Court below. Points are answered

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accordingly.

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7. In the result, the Civil Revision Petition is allowed and the impugned order is set aside insofar as it related to the petitioner/4^th DHr and the matter is remitted to the Court of execution for fresh disposal in accordance with the procedure established by law. Both the petitioner/4^th DHr and the JDr are given liberty to file fresh calculation memos keeping in view the correct legal position applicable to the facts of the case and by following the precedential guidance in the precedents to the extent applicable to the case. On filing of such calculation memos, the Court of execution shall hear both the parties and decide the matter afresh on merits having regard to the facts and the law. There shall be no order as to costs.

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Miscellaneous petitions pending, if any, in this revision shall stand closed.

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M. SEETHARAMA MURTI, J

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6^th December 2014

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Vjl

Maddineni Hanumantha Rao v. The Mandal Revenue Officer

Case brief

What is this about?

What did the court decide?

Maddineni Hanumantha Rao v. The Mandal Revenue Officer

Case brief

What is this about?

What did the court decide?

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