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1959 DIGILAW 20 (MP)

Bhagwan Kishan v. Chhotelal Lachhman

1959-01-27

SHIV DAYAL SHRIVASTAVA

body1959
JUDGMENT Shiv Daya, J. An ex parte decree in favour of Bhagwan Kishan Appellant, against one Mahadeo Shankar, was passed by the Civil Judge of Malkapur (C. P.) on September 20, 1945 for Rs.3,525-12-0 in Civil Suit No. 38-B of 1945. Execution was taken out of the said ex parte decree and the same was transferred for execution to the District Judge, Mhow. In Execution Case No. 49 of 1948, the District Judge, Mhow issued a warrant of attachment of the property of the judgment-debtor on October 10, 1945. The same day, the judgment-debtor made an application to the District Judge praying that the attachment be stayed so as to enable him to make an application to the Malkapur Court for setting aside the ex parte decree. On that application, the District Judge, Mhow, passed the following order: The attachment can be released on judgment-debtor's furnishing security for the payment of the decretal amount. The judgment-debtor therefore furnished security that very day. Chhotelal, who stood surety, executed a surety bond on October 10, 1945 which was verified on October 11, 1945. Mahadeo Shankar, the Defendant (judgment-debtor) then applied to the Malkapur Court for setting aside the ex parte decree. His application was dismissed by the first Court but on appeal, the District Judge, Akola, set aside the ex parte decree by his judgment dated March 12, 1947. As a consequence, the suit was reopened and it was eventually decreed in favour of the Plaintiff by the Court at Malkapur on June 30, 1947 in Civil Suit No. 38-B of 1945. The Plaintiff was, however, aggrieved by that judgment on the question of interest. He preferred an appeal and that was allowed by the District Judge, Akola, on December 9, 1947 in Appeal No. S-B of 1947 and to that extent, the decree of the first Court was modified. I am told that this latest decree of June 30, 1947, as modified by the appellate Court on December 9, 1947, was put to execution in the Court of District Judge, Mhow, but execution was refused on the ground that Malkapur Court by that time became a foreign Court and its decree could not be executed by the Mhow Court which had since become a Court in the State of Madhya Bharat. Bhagwan Kishan decree-holder, therefore, brought this suit in the Court of Civil Judge, First Class, Mhow, against Chhotelal for the recovery of Rs.4,763-8-0 by enforcement of the aforesaid surety bond dated October 10, 1945. This suit was instituted on December 7, 1950. Chhotelal surety resisted the suit on various grounds, viz., that the suit was barred by time; that his liability came to an end as soon as the ex parte decree of the Malkapur Court dated September 20, 1945 was set aside; that a suit was barred as the only remedy for the Plaintiff was by- way of execution of that decree in the competent Court; and, that the last decree was a nullity inasmuch as Mahadeo Shankar had died before the decree was passed. The learned trial Judge decided the suit in favour of the Plaintiff and awarded him a decree for Rs.4,765-8-0 holding that the suit was within time and that the surety was liable because he had undertaken to pay the amount of the decree which might eventually be passed. Chhotelal surety preferred an appeal to the District Judge, Indore, who, allowing it, set aside the judgment of the first Court and dismissed the Plaintiff's suit with costs. Hence this second appeal by the Plaintiff decree-holder. The first contention raised by Shri Vijayvargiya, Learned Counsel for the Plaintiff-Appellant, is that the lower appellate Court has erred in misconstruing the surety bond. According to the Learned Counsel, the surety undertook to pay the amount which might be found due in the decree to be eventually passed and that the liability was not confined to the event of the Defendant's application for setting aside the ex parte decree being dismissed. It will be worthwhile to quote the exact words used in the surety bond dated October 10, 1945. In this bond, the surety has made himself liable in the following events: (i) if the judgment-debtor Mahadeo Shankar did not initiate any proceeding for setting aside the ex parte decree, or (ii) on the proceeding so initiated, if the decree stood or the decretal amount was reduced. Since Mahadeo Shankar actually applied for setting aside the ex parte decree, the first alternative is out of the question. Since Mahadeo Shankar actually applied for setting aside the ex parte decree, the first alternative is out of the question. As regards the second, the argument of Shri Vijayavargiya is that the surety made himself liable not only in case the application for setting aside the ex parte decree were dismissed, but also if the ex parte decree were set aside and eventually a fresh decree were passed. He supports his arguments by laying emphasis on the words because the amount as allowed in the ex parte decree could not be reduced in proceedings for setting aside the ex parte decree, and therefore these words necessarily refer to the decree which might ultimately be passed after the reopening of the suit. If the bond had merely said that the surety would be liable if the decree had stood meaning thereby the dismissal of the application for setting aside the ex parte decree the construction put by the lower appellate Court would have been intelligible. On this line of reasoning, Shri Vijayvargiya contends that the surety is liable and the judgment of the first Court must be restored. On the other hand, Shri Sanghi Learned Counsel for the Respondent (surety), argues that the surety made himself liable under the bond only to the extent specified therein, that is to say, in the event of either not instituting proceedings for setting aside the ex parte decree or being unsuccessful therein. According to Shri Sanghi, the surety did not make himself liable beyond that; and all the words used in the bond are referrable only to the proceedings for setting aside the ex parte decree. It is obvious enough that an ambiguity has arisen because of the introduction of the words and the Plaintiff's case has been built upon that basis because the result of an application for setting aside an ex parte decree could either be that it would be allowed or disallowed: in ease it was disallowed, the decree stood, and in case it was allowed, the suit would have been reopened. In no event could the amount of the decree be varied. In order to arrive at a proper construction of the words employed in a surety bond, the circumstances in which it was executed become very pertinent. In no event could the amount of the decree be varied. In order to arrive at a proper construction of the words employed in a surety bond, the circumstances in which it was executed become very pertinent. It has been stated in Sir Rolan Burrow's book on Interpretation of Documents, (ii Ed.) at page 49 as follows: Where contemporary documents cart be read in more ways than one, and in one of them they are consistent and in the other or others inconsistent, that construction is to be preferred which will render them consistent. If one of two such documents is ambiguous in its terms and the other is clear, force is to be given to the latter so as to interpret the ambiguous document. Then at page G9 of the same book it is stated as under: It has already been pointed out that a word may have a modified or different meaning when used in combination with other words. The position in a phrase or sentence may also affect the sense in which a word is used. But the context in which a word appears may also indicate in relation to a word which has several meanings, especially when it has meanings which almost insensibly pass from one to another, which of those several meanings it is in fact intended to convey, or may negative any suggestion that one or more of its possible meanings can have been intended. It has been stated in Halsbury's Laws of England that the object of interpretation of a document is to ascertain the intention of the parties to the instrument as expressed by the words they have used: If the intention of the parties can be ascertained from the written instrument, the Court will give effect to that intention notwithstanding ambiguities in the words used or defects in the operation of the instrument. This is expressed by the maxim ut res magis valeat quam pereat(sic), or the English paraphrase: 'A deed shall never be void where the words may be applied to any intent to make it good.' Hence where the words are capable of two meanings the object with which they were inserted may be looked at in order to arrive at the sense in which they were used. The Court leans to an interpretation in construing two contemporaneous documents, to a construction which will reconcile them rather than one which will render them inconsistent. In order to give effect to a contract according to what appears to have been the intention of the parties, the Court may imply a term or condition or qualification of a clause which is not inconsistent with the general tenor of the document. (Salmond Ed., Vol. 11, paragraph 640). In Seth Dawood v. Ramprasad 1937 NLJ 266 : AIR 1938 Nag 75., Vivian Bose J., has held that if there is any ambiguity in the words of a surety bond, the bond must be construed in the light of the order directing the security to be given. In that case, Mohendranath v. Satishchandra AIR 1934 Cal. 569., was followed, which relied on observations in Raja Raghunandan Prasad v. Raja Kirtyanand Singh AIR 1932 P.C. 131. It was further held in that case that where a surety bond is furnished to set aside an ex parte decree the decree is set aside and a new decree passed, the surety is not liable and cannot be proceeded against under Section 145 of the Code of Civil Procedure. It was held in Chairman, Seraiganj Municipality v. Chittagong Company Ltd. AIR 1923 Cal. 32., that when words are equally applicable to two or more persons or to two or more things, it is a latent ambiguity and in such a case extrinsic evidence is admissible to resolve it. In the instant case, it must be recalled that on October 10, 1945, the District Judge, Mhow, passed an order for attachment of properties of Mahadeo Shankar (judgment-debtor). On that very day Mahadeo Shankar applied to that Court for staying attachment and allowing him time to move the Malkapur Court for setting aside the ex parte decree and on that very day, the District Judge, Mhow passed the order which I have quoted in extenso at the outset. Now, in this case, there is no manner of doubt that the surety bond was executed just because Mahadeo Shankar had applied for stay of attachment and the District Judge, Mhow acceded to his request subject to the condition that he furnished security for the payment of the decretal amount. I do not see any ambiguity in the order of the District Judge. I do not see any ambiguity in the order of the District Judge. The only intention of that order was that in case the judgment-debtor did not take steps for setting aside the ex parte decree (for which purpose he prayed for stay) or in the event that his application for setting aside the ex parte decree were dismissed and the decree under execution before him remained good, the surety would be liable. The District Judge did not require security for the payment of such decree as may be passed even after the decree in execution before him bad been set aside because he was in no way concerned with that; and in my opinion, such an intention could not be entertained by that executing Court. Thus I hold that there was no ambiguity, whatsoever, in the order of the District Judge, Mhow, dated October 10, 1945 and its meaning is very clear. In that context, the only thing that was required of the judgment-debtor was to furnish security for the performance of that decree which was under execution at that time, in case the judgment-debtor did not succeed in getting the ex parte decree set aside. This is also the intended purpose of the surety bond as is very clear from the opening words in the bond: This preamble leaves no doubt that it was in that situation that the surety came to the aid of the judgment-debtor. The word (therefore) is also very significant. Now I must examine the import of the word 'Karrawai' (proceeding) used in the bond. The surety undertook to pay the decretal amount in case the judgment-debtor did not institute any proceeding (Karrawai) for setting aside the ex parte decree. The bond goes on to Bay that if the judgment-debtor initiated such proceedings (karrawai) and the decree stood or the decretal amount was reduced, then also the surety would be liable. Now, the only reasonable construction of this last mentioned expression is that if in the result of such proceedings, the decree stood as it was or was modified in such a way that the decretal amount was reduced, the surety would be liable, Here again, therefore, the word "Karrawai" refers to the proceedings for setting aside the ex parte decree and to no other proceeding. It does not refer to the suit which would be reopened as a result of the ex parte decree being set aside. In using the last mentioned expression, the intention of the surety is clear that he did not want to make himself liable for any amount more than Rs.3,999-7-0 for which the decree was being executed on that day. His anxiety was to fix that amount as the outside limit of his liability. It could be less, but not more. I do not agree with Shri Vijayvargiya that the words "Zare Decree Me Kami Waqey Ho Jay" must necessarily be construed as to imply that the surety undertook to be liable even for the fresh decree after the setting aside of the ex parte decree, just because it was not possible in those proceedings (for setting aside the ex parte decree) that the amount could be reduced. That merely shows the ignorance of the draftsman of the surety bond, which was drawn by a petition-writer as has been mentioned at the foot of the bond itself (Ex. 3). The result of this discussion is that the liability of Chhotelal surety came to an end when Mahadeo Shankar moved the Malkapur Court for setting aside the ex parte decree and as soon as that decree was set aside on March 12, 1947, by the order of the District Judge of Akola in Civil Misc. Appeal No. 29 of 1946. The second contention of Shri Vijayvargiya is that the matter is res judicata for two reasons: (i) because of the order of the District Judge, Akola dated September 1, 1947 in Miscellaneous Judicial Case No. 15 of 1947 (Ex. A-7), and (ii) because of the judgment of the High Court of Madhya Bharat, Indore, dated August 17, 1953 in Civil Second Appeal No. 317 of 1950. 1 will presently examine these grounds. The order dated September I, 1947, was passed by the District Judge, Akola in these circumstances. When he allowed Defendant Mahadeo Shankar's appeal (Civil Misc. A-7), and (ii) because of the judgment of the High Court of Madhya Bharat, Indore, dated August 17, 1953 in Civil Second Appeal No. 317 of 1950. 1 will presently examine these grounds. The order dated September I, 1947, was passed by the District Judge, Akola in these circumstances. When he allowed Defendant Mahadeo Shankar's appeal (Civil Misc. Appeal No. 29 of 1946) on March 12, 1947 and ordered that the ex parte decree be set aside, he also casually observed: "and as a result of this decree having been set aside, will terminate automatically, (The learned Judge was referring to the surety bond) and I am however of the view that the security already furnished by the Appellant lapses automatically and cannot therefore be ordered to be available and to such time as the Appellant furnishes security". On Plaintiff Bhagwan Kishan's application under Order 47, Rule 1 read with Section 151, Code of Civil Procedure Code, the learned Judge ordered that these words (which have been quoted above within inverted comas) in his order dated March 12, 1947, be deleted. He observed: I have seen the transliteration and English translation of the certified copy of the bond (which is in Urdu). There is a term therein which appears to indicate that the scope of the bond is much wider than what I imagined it to be when I passed my order dated March 18, 1947 (should have been March 12, 1947). The bond was not before me then and all that was told to me was that it was furnished in execution. In my opinion, there is no question of res judicata in these circumstances. In the proceedings before the learned Dietrict Judge, Akola the surety was not a party and moreover, there was no occasion for the learned District Judge to give any finding as to the scope of the surety bond or the liability of the surety thereunder. "The order of the High Court of Madhya Bharat has been filed; it is marked as Ex. 12. It was passed in the following circumstances: When the fresh decree dated June 30, 1947 (as modified by the District Judge, Akola, on December 9, 1947), was passed in favour of Bhagwan Kishan, he applied to the Civil Judge, First Class, Mhow for recovery of the amount from the surety under Section 145 of the Code of Civil Procedure. 12. It was passed in the following circumstances: When the fresh decree dated June 30, 1947 (as modified by the District Judge, Akola, on December 9, 1947), was passed in favour of Bhagwan Kishan, he applied to the Civil Judge, First Class, Mhow for recovery of the amount from the surety under Section 145 of the Code of Civil Procedure. The surety challenged the jurisdiction of the Court on the ground that Malkapur was in Madhya Pradesh and therefore, the decree of that foreign Court could not, be transferred to Mhow Court because Mhow cantonment had by then retroceded to Holkar State. The learned Civil Judge held that the retrocession did not affect that case but as the decree had not been transferred by the District Judge, Akola, proceedings could not be taken under Section 145, Code of Civil Procedure Code. That order was upheld by the Additional District Judge, Indore and the decree-holder went to the High Court of Madhya Bharat, Indore in second appeal. Deciding that appeal, the Late Shri Justice Mehta held that if the decree-holder wanted to proceed against the surety on the basis of the surety bond, he could do so by an independent suit, and further that as the decree that was passed by the District Judge, Akola, on December 9, 1947, had not been transferred to the Mhow Court, the latter had no jurisdiction to execute it. But in his judgment the learned Judge also observed as follows: In the present case, on a strict - interpretation of the security bond, the surety has rendered himself personally liable for the due performance of the decree that may ultimately be passed and the decree-holder shall have the power to recover the amount due at once. Relying on these words, Shri Vijayvargiya contends before me that the High Court of Madhya Bharat has already decided the issue whether the surety was liable only for the first decree of 1945 or was also liable for a decree which was eventually passed after the setting aside of the ex parte decree. But I do not read any such decision in the judgment of the High Court dated August 17, 1953. What is more, once the High Court held that those proceedings under Section 145 were without jurisdiction, no observation of any Court in those proceedings could be binding on any party. But I do not read any such decision in the judgment of the High Court dated August 17, 1953. What is more, once the High Court held that those proceedings under Section 145 were without jurisdiction, no observation of any Court in those proceedings could be binding on any party. Therefore, the plea of res judicata on the basis also is untenable. On these findings, the Plaintiff's suit must fail and it is not necessary for me to decide any other question. The appeal is dismissed with costs. Appeal dismissed