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1996 DIGILAW 540 (ALL)

KAMTA PRASAD v. IIND ADDL DISTRICT JUDGE MAINPURI

1996-05-03

D.K.SETH

body1996
D. K. SETH, J. Petitioner as plaintiff filed suit No. 18 of 1974 against opposite party No. 3 as defendant for the recovery of a sum of Rs. 2200 in the Court of Munsif, Shikohabad. The said suit was decreed on 5th July 1978. Execution Case No. 26 of 1978 was levied for executing the said decree. Objection under Section 47 of the Code of Civil Procedure, hereinafter referred to as the Code, filed by the defen dant judgment- debtor was registered as Misc. No. 121 of 1979. By an order dated 14th August 1980 passed by the learned Munsif, Shikohabad in Misc. Case No. 121 of 1979, the objection under Section 47 of the Code was allowed. The plaintiff-petitioner filed Civil Revision No. 148 of 1980. By judgment and Order dated 31st July 1981, passed by the II Additional Dis trict Judge, Mainpuri, the said revision was dismissed and the order dated 14th August 1980 was confirmed. It is against these or ders the present writ petition has been moved. 2. The learned counsel for the petitioner contends that prior to the filing of the objection registered as Misc. Case No. 121 of 1979, the judgment debtor had filed another objection to the execution which stood dismissed on compromise between. the parties which is Annexure T to the writ petition in which after the objection having been dismissed, the judgment debtor had agreed to make the payment of the decretal amount on 15th May 1979 and in default his properties would be sold on auction. There fore, according to the learned counsel for the petitioner Mr. R. K. Goswami, the second objection is not maintainable be cause of the principle of constructive res-judicata. It is also contended that the same objections which have been taken in Misc. Case. No. 121 of 1979 were also taken in Misc. Case No. 29 of 1979. The judgment debtor having allowed the said objection to be dismissed by agreement, the judgment debtor is estopped from raising the said objection subsequently. It is also contended that the same objections which have been taken in Misc. Case. No. 121 of 1979 were also taken in Misc. Case No. 29 of 1979. The judgment debtor having allowed the said objection to be dismissed by agreement, the judgment debtor is estopped from raising the said objection subsequently. He also contends that even on merits, the objection can not be sustained since Section 18 does not apply to pending suits and it has no manner of retrospective operation in view of the ex pression used in Section 18 of the U. P. Regulation of Money-lending Act, 1976, hereinafter referred to as the Act with those of the Benami Transactions (Prohibi tion) Act, 1988. In support of his conten tion, Mr. Goswami relies on the case of R. Raiagopal Reddy v. Padmini Chandrasekharan JT 1995 (2) S. C. 667 : 1995 (1) JCLR 779 (SC ). 3. The learned counsel for the opposite party Mr. R. K. Misra, on the other hand, contends that by reason of sub-section (4) of Section 26 of the Act, the decree has rendered inexecutable. According to him, by agreement, a decree rendered inex ecutable by operation of statute can not be revived or made executable. Inasmuch as there can not be any estoppel against statute. According to him, the said agree ment was not a compromise. The same was only postponement of execution which was kept alive and in default was to be executed. He further contends that the principle of res judicata, constructive or otherwise, is not attracted in the present facts and cir cumstances of the case. 4. The alleged compromise can not be termed to be a compromise within the meaning of Order 23 Rule 3 of the Code. Inasmuch as the decree can not be varied or altered after the same has been passed by agreement. Therefore, there can not be any compromise with regard to the decree. At best the compromise can be treated to be an agreement of adjustment. If it is an agree ment of adjustment, then provision of Order 21 Rule 2 would be attracted. Unless such agreement satisfies the test of certifica tion as contemplated in Order 21 Rule 2, the same can not be treated to be an adjustment. In the present case, the decree-holder has not furnished the adjustment nor the Court has certified the same. Unless such agreement satisfies the test of certifica tion as contemplated in Order 21 Rule 2, the same can not be treated to be an adjustment. In the present case, the decree-holder has not furnished the adjustment nor the Court has certified the same. It is also not the case of the decree-holder that the same was an adjustment. Then again there was no adjust ment of the decree which remained fully executable. It was only a case of postpone ment of execution of the decree till 15th May 1979 and nothing else. 5. Now the question arises as to whether the agreement without being a compromise or an adjustment can be bind ing on the judgment debtor on the face of Section 26 (4) of the Act. A reading of An nexure T makes it clear that even if there was an agreement, the agreement had three parts-the first one that the objection shall stand dismissed, the second part is that the judgment debtor would pay the entire amount by 15th May 1979 and the third part is that the execution case shall remain pending and in default the decree shall be ex ecuted by putting the property of the judg ment-debtor in auction for sale. The said agreement does not show as to upon which consideration the judgment debtor had agreed to make those concessions which have been made in the said agreement. It does not appear as to what the judgment-debtor has gained by the said agreement. Inasmuch as even if this objection would have been dismissed on merit, still then the payment would have been postponed even for the period later than 15th May 1979 and that the decree would be executable in case the judgment debtor did not pay by putting the property of the judgment debtor into auction. Therefore, it is the decree- holder who had gained by removing the obstruc tion of the objection under Section 47 without conceding any benefit of gain to the judgment debtor. It conclusively proves that the said agreement is without any con sideration. Under Section 25 of the Con tract Act, an agreement without considera tion is void. Therefore, the said agreement being without consideration is also void. The decree holder can not derive any benefit out of the same. It conclusively proves that the said agreement is without any con sideration. Under Section 25 of the Con tract Act, an agreement without considera tion is void. Therefore, the said agreement being without consideration is also void. The decree holder can not derive any benefit out of the same. A compromise within the meaning of Order 23 Rule 3 is void for the same reasons relating to contract in view of explanation under Order 23 Rule 3 of the Code. 6. That apart, the execution case was kept alive while the application under Sec tion 47 was allowed to be dismissed for non-prosecution. No issue having been decided, the principle of resjudicata, constructive or otherwise, can not be attracted. At the same time, it is not a case of withdrawal of the application under Section 47 within the meaning of Order 23 Rule 1 attracting mis chief of Sub-rule (4) thereof prohibiting the judgment-debtor from making any further application under Section 47. In execution proceedings, after the execution is dis missed, a fresh execution can be levied provided the same is not barred by limita tion. When the objection under Section 47 is not decided on merits, and the principle of resjudicata is not attracted, the dismissal of the application for non-prosecution even by agreement does not preclude the judgment debtor from filing a fresh application under Section 47. Since the execution is still con tinuing, the same can be objected to by the judgment debtor particularly in view of the observation made by me that the agreement was without consideration. There can not be any question of estoppel as against the judg ment debtor. Even then the nature of the agreement can not create estoppel in the facts and circumstances of the case as against the judgment debtor. 7. Then again Section 26 of the Act lays down: "26. Particulars of debts and deposits to be furnished by every money-lender.- (1) Every money-lender carrying on the business of money-lending from before the commencement of this Act shall submit to the Registrar, a statement in the prescribed form within a period of three months from the date of such commencement. Then again Section 26 of the Act lays down: "26. Particulars of debts and deposits to be furnished by every money-lender.- (1) Every money-lender carrying on the business of money-lending from before the commencement of this Act shall submit to the Registrar, a statement in the prescribed form within a period of three months from the date of such commencement. Provided that the Registrar may on an ap plication by such money-lender, for sufficient cause condone the delay and accept the statement submitted within three months from the date of the commencement of the Uttar Pradesh Regula tion of Money-lending (Amendment) Act 1978. (2) The statement referred to in sub-section (1) shall contain the particulars of debts due to each money-lender and of deposits made with him and such other particulars may be prescribed. (3) Every such statement shall be counter signed, dated and sealed by the Registrar and shall be kept and maintained in the manner prescribed. (4) Notwithstanding anything contained in any contract, decree or order or any other law for the time being in force, no money-lender shall be entitled to claim any amount from a debtor in respect of any loan advanced before the commen cement of this Act, unless the name of such debtor and the amount due from him has been specified in the statement referred to in sub-section (1 ). " 8. Sub-section (4) clearly lays down that notwithstanding any contract, decree or order, a money-lender is precluded from recovering any amount from a debtor even in respect of loan advanced before the com mencement of the said Act unless the amount due from him has been specified in the statement referred to in sub-Section (1) of Section 26. 9. Now according to sub-Section (1), a money-lender is supposed to submit his return within three months from the date of commencement of the said Act in case he is carrying on such business since before the commencement of the said Act. The said three months period can also be extended by the Registrar upon an application so made showing sufficient cause. Admittedly in the present case, no such statement has been filed. It is not the case of the plaintiff-decree holder that any such statement has been filed. The said three months period can also be extended by the Registrar upon an application so made showing sufficient cause. Admittedly in the present case, no such statement has been filed. It is not the case of the plaintiff-decree holder that any such statement has been filed. On the other hand, it is the case of the decree-holder that he ceased to carry money-lending business after the commen cement of the said Act and, therefore, the provisions of the said Act are not attracted. But the courts below had found to the con trary. The said findings are concluded by concurrent findings of fact that the decree-holder is a money-lender. This court in revision cannot reassess the evidence nor can it reappraise the same. In exercise of writ jurisdiction, the High Court can not under-take exercise on the finding of fact. Therefore, on the basis of the finding of both the courts below that the decree-holder was a money- lender and that he has not complied with Section 26 (1), Section 26 (4) is attracted in full force. Even if the said compromise is said to be a contract, even then by virtue of such contract, the decree-holder is prohibited from recovering the debt by reason of sub-Section (4) of Section 26. On the other hand by reason of Section 26 (4), the decree-holder can not recover the debt despite the decree having been in his favour. 10. Therefore, it is crystal clear, in the facts and circumstances of the present case, that neither the contract contained in Annexure 1 nor the decree could be enforced by the decree-holder, the money- lender, for recovering his debts. This situation is brought into being by operation of the statute. The right of the judgment-debtor flows from the statute. By agreement the statute cannot be silenced. Even then such agreement may be contrary to law and as such void in view of Section 23 of the Con tract Act. A decree which has been rendered inexecutable by reason of the statute can not be put back to life by agreement of the parties. By reason of sub-Section (4), the jurisdiction of the Court to execute such decrees which helps recovering the debts otherwise prohibited under sub-Section (4) has been taken away. By agreement the Courts cannot be conferred jurisdiction which otherwise it does not have. 11. Now the contention of Mr. By reason of sub-Section (4), the jurisdiction of the Court to execute such decrees which helps recovering the debts otherwise prohibited under sub-Section (4) has been taken away. By agreement the Courts cannot be conferred jurisdiction which otherwise it does not have. 11. Now the contention of Mr. Goswami to the extent that sub-Section (4) of Section 26 is eclipsed by reason of Section 18 may be attended to. According to him, Section 18 preceding Section 26 would be preferred to Section 26 in case of contradic tion. He contends that Section 26 is ultra vires to Section 18. Section 18 provides as follows: 18. Bar on certain suits by money-lender.- (1) No suit on the basis of any loan, agreement of security referred to in sub-section (1) of Section 15 shall be instituted by a money-lender, unless at the time of advancing such loan or making such agreement or taking such security- (a) such money-fender held a valid certifi cate of registration; or (b) such money-lender had applied for such certificate and the same had not been refused; or (c) the period specified in the proviso to sub-section (l)of Section 7 had not expired. 12. The contention that Section 26 is ultra vires to Section 18 is wholly miscon ceived. The two Sections can not be ultra vires to each other. In case there is any con tradiction, the same are to be reconciled and interpreted harmoniously. Even the vires of Section 26 has not been challenged in the present petition. I have also not been in formed of any decision holding Section 26 to be ultra vires to Section 18 or that any such petition for such declaration is pend ing. In my view, however, Section 18 and Section 26 operates in two different fields in respect of money lending. The same never come in conflict with each other. Section 18 deals with suits which shall be instituted after the commencement of the present Act. In my view, however, Section 18 and Section 26 operates in two different fields in respect of money lending. The same never come in conflict with each other. Section 18 deals with suits which shall be instituted after the commencement of the present Act. Section 15 of the said Act provides that the provision of Chapter V will apply to every suit by a money-lender for recovery of loan advanced after the commencement of the Act or in respect of any enforcement of any security taken or any agreement made after the commencement of the Act in respect of any loan advanced either before or after such commencement or for redemption of any security given to the money-lender after the commencement of the Act in respect of any loan advanced either before or after such commencement. Therefore, the case contemplated in Section 18 deals with the suits based on loan, agreement or security referred to in sub-Section (1) of Section 15. Therefore, only suits based on sub-section (1) of section 15 are hit by Section 18. But in the present case, the suit was filed before the commencement of the Act though the decree was obtained after the commence ment. It appears, however, that Section 18 operates only in respect of suits that shall be instituted after the commencement. 13. In the case of R. Rajagopal Reddy (supra), the question arose as to whether Section 4 (1) of the Benami Transactions (Prohibition) Act, 1988 could be applied in respect of cases where claims were made prior to the enforcement of Section 4 (1) of the said Act. In the said case, it was held, after considering various provisions of the Act, that the operation of Section 4 (1) was prospective and not retrospective and, as such, was not attracted in respect of claims mentioned prior to the commencement of Section 4 (1) in respect of actions taken before its enforcement. On the same anal ogy, the scheme of the present Act clearly reveals that Section 18 applies only prospectively to suits to be filed after the commencement of the Act by reason of specific provision provided in Section 15 which specifies the cases in respect whereof the provision of Chapter V will apply. On the same anal ogy, the scheme of the present Act clearly reveals that Section 18 applies only prospectively to suits to be filed after the commencement of the Act by reason of specific provision provided in Section 15 which specifies the cases in respect whereof the provision of Chapter V will apply. Sec tion 15 (1) does not include pending suits because it deals with in clause (a) with loan advanced after the commencement of the Act and clause (b) deals with enforcement of any security taken or any agreement made after commencement of the Act though loan may be advanced prior to the agree ment. In clause (c), the redemption of security is given after the commencement of the Act is contemplated though the loan might have been given either before or after the commencement. Therefore, the suit as contemplated in Clauses (a), (b) and (c) of Section 15 (1) are suits which enforces loan, security, agreement, redemption arising after the commencement of the said Act. Though clauses (b) and (c) may relate to loan advanced prior to the commencement but the cause or action in both the cases are enforcement of security, agreement, redem ption arising after the commencement. Therefore, undoubtedly there is no scope for applying Section 18 in any pending suits since the operation of Section 18 is confined only to suits mentioned in Section 15 (1) in respect whereof Chapter V is applicable. 14. Whereas Section 26 deals with cases in respect of business of money-lend ing from before the commencement of the Act in respect whereof statement is to be submitted. The statement made contains such business which took place prior to the commencement including those in the suits instituted prior to the commencement. Only when the statement as contemplated under sub-section (1) of Section 26 are complied with, that too within a period of three months which contemplates that it deals with business carried on prior to the commencement of the said Act, the mischief of sub-section (4) shall not be attracted. Section 26 (1) does not contemplate of any business transacted after the commence ment of the Act which will govern by the provisions of the said Act. Sub-section (4) clearly indicates that contract, decree in respect of loan advanced before the com mencement of the Act are subject-matter of sub-section (4 ). Section 26 (1) does not contemplate of any business transacted after the commence ment of the Act which will govern by the provisions of the said Act. Sub-section (4) clearly indicates that contract, decree in respect of loan advanced before the com mencement of the Act are subject-matter of sub-section (4 ). Therefore, the contract or decree in respect of loans advanced before the commencement of the Act outside the provision of Section 15 (1) are subject-mat ter of Section 26 (4) which were altogether distinguished from each other. Therefore, the operation of the field being different, there is no conflict or contradiction in be tween Section 18 and Section 26. 15. Mr. Misra relies on the judgment in the case of Ram Gopal v. Kailash Narain Misra 1980 ALJ 606 in support of his con tention that unless the name of the debtor is included in the statement filed by the money-lender, the claim of the money lender fails. In the said case, it was held that unless the name of the debtor is registered under Section 26 (1) and the statement is filed thereunder, the debt is irrecoverable. According to the ratio decided in the said case, such an objection can very well be taken even in Section Appeal and that Sec tion 26 (4) is retrospective in the sense that it applies to the loans taken before the com mencement of the Act and which have not been recovered till the date of the commen cement of the Act. The suit for the recovery of such loan pending in the Trial Court stage or in the appellate stage on the date of the commencement of the Act would come within the purview of Section 26 (4) of the Act. If once the suit has been filed and a decree has been obtained, the provision of Section 26 (4) shall be equally applicable. Thus it appears by reason of Section 26 (4), a decree passed in suit for recovery of loan advanced prior to the commencement of the Act in contravention of Section 26 (1) read with Section 26 (4) is a nullity. Therefore, such a decree is non-est in the eye of law and can not be executed. As such objection can be taken at any point of time. 16. Therefore, such a decree is non-est in the eye of law and can not be executed. As such objection can be taken at any point of time. 16. That apart, when the statute allows such decree or contract unenforceable by operation of law even if no application is made and the attention of the Court is drawn to such a situation, it is the duty of the executing court to examine and find out as to whether the decree is executable. In as much as it goes to the root of the jurisdiction of the executing court, namely, as to whether the executing court has jurisdiction to execute the same. 17. An executing court has jurisdiction while executing the decree to examine the executability of the decree. Thus it appears that the alleged agreement is neither a com promise nor an agreement nor creates es toppel as against the statute so far as the judgment debtor is concerned. At the same time, the principle of resjudicata is also not attracted in view of the specific provision of Section 26 (4) even if the earlier objection under Section 47 was allowed to be dis missed for non-prosecution apart from the grounds upon which I had negatived the contention earlier. Admittedly it is also not saved by compliance of Section 26 (1) of the said Act. 18. For all these reasons, I am unable to agree with the contention of Mr. Goswami. Nothing transpires to bring the case within the ambit of the violation of fun damental principles of law in order to ac tivate writ jurisdiction for interfering with the impugned order in the facts and cir cumstances of the present case as has been held in the case of Ganga Saran v. District Judge Hapur (3 ). 19. In the result, the application fails and is dismissed. There will, however, be no order as to costs. Application dismissed. .