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2016 DIGILAW 4239 (MAD)

S. Gowthamchand v. R. Ramesh Kumar

2016-12-23

M.SUNDAR

body2016
ORDER : M. Sundar, J. This is an appeal [numbered as an application] assailing an order dated 22.03.2012, made by the learned Master in A. No. 554 of 2010 in E.P. No. 52 of 2004. 2. This application has been filed invoking the provisions of Order 14, Rule 12 of the Code of Civil Procedure, 1908 ['CPC' for brevity]. Considering the nature of the proceedings under Order 14, Rule 12 of CPC and in the light of the Division Bench judgment in Shreya Sripaul's case, this is numbered as an application. This application calls in question the order of the learned Master, wherein and whereby, the learned Master has held that an application under Section 47 of CPC filed by one of the Judgment Debtors is maintainable. 3. A brief narration of the facts that are necessary for disposal of this application sans unnecessary is considered necessary. 4. Factual Matrix: (i) The main suit has been filed by two plaintiffs against two defendants. The main suit is a money suit seeking recovery of monies borrowed by the first defendant for which, the second defendant stood guarantee. The suit claim is Rs. 13.79 Lakhs. There are incidental and ancillary prayers. (ii) The main suit is a Summary Suit that has been filed invoking the provisions of Order 37 CPC i.e., Summary Suit invoking Order 37 CPC on the basis of Negotiable Instrument, namely, cheques by which, the loan was tendered and demand promissory notes ['DPN' for brevity] which were executed by the borrowers. (iii) It is the case of the plaintiffs that the first defendant borrowed a total sum of Rs. 8.5 Lakhs in all, from them for commercial purpose, in the period between 04.02.1995 and 25.02.1997. It is the further case of the plaintiffs that the second defendant executed a letter of guarantee and also a DPN in favour of the plaintiffs for the entire sum of Rs. 8.5 Lakhs on 25.02.1997. (iv) It is also the case of the plaintiffs that the liability of the defendants is coextensive. (v) As the defendants committed default in repayment, a lawyer's notice dated 17.04.1999 was issued, for which, the second defendant alone sent a reply dated 10.04.1999. The first defendant neither replied nor complied. Therefore, the above said Summary Suit [plaint dated 14.06.1999] was launched on the Original Side of this Court. (vi) The first defendant remained ex parte. (v) As the defendants committed default in repayment, a lawyer's notice dated 17.04.1999 was issued, for which, the second defendant alone sent a reply dated 10.04.1999. The first defendant neither replied nor complied. Therefore, the above said Summary Suit [plaint dated 14.06.1999] was launched on the Original Side of this Court. (vi) The first defendant remained ex parte. In other words, the first defendant did not enter appearance and give notice of appearance as required under various rules and sub rules of Order 37 CPC. However, the second defendant entered appearance and took out an application being A. No. 2002 of 2000 seeking unconditional leave to defend the suit. It is not in dispute between the parties that this application for unconditional leave taken out by the second defendant was dismissed. It is also not in dispute that such dismissal has been given complete legal quietus. In other words, that dismissal has attained finality. (vii) Thereafter, the judgment and decree came to be passed in the main suit on 24.04.2002. It is pertinent to notice that this judgment and decree is an ex parte decree qua only the first defendant and for all other practical purposes, it is a contested decree which was passed in the presence of the counsel for the second defendant. (viii) To see the colour of the coin under the above said decree, plaintiffs launched an Execution Petition in E.P. No. 52 of 2004. This Execution Petition was launched on 20.08.2003. This Execution Petition was launched seeking recovery of the monies, due under the decree from the Judgment Debtors by proceeding against i.e., the movable assets and effects of the Judgment Debtors. (ix) It may be relevant to place on record that the plaintiffs namely, plaintiffs 1 and 2 are the Decree Holders 1 and 2. Equally, the defendants namely, defendants 1 and 2 are Judgment Debtors 1 and 2 respectively. Therefore, the term Decree Holders and Judgment Debtors are also used interchangeably with the terms plaintiffs and defendants. (x) The second defendant/judgment Debtor took out an application, being A. No. 554 of 2010 invoking Section 47 of CPC. The crux and gravamen of the 47 application taken out by the 2nd Judgment Debtor is that, the decree is a nullity. Therefore, the term Decree Holders and Judgment Debtors are also used interchangeably with the terms plaintiffs and defendants. (x) The second defendant/judgment Debtor took out an application, being A. No. 554 of 2010 invoking Section 47 of CPC. The crux and gravamen of the 47 application taken out by the 2nd Judgment Debtor is that, the decree is a nullity. The main ground on which, it is alleged that the decree is a nullity, is that borrowings were independent transactions with the two plaintiffs, but no leave has been obtained under Clause 14 of the Letters Patent. (xi) As a sequiter to the above submission, it is further contended by the second defendant/Judgment Debtor that the Original Side of this Court lacks pecuniary jurisdiction for passing the decree, owing to absence of the leave under Clause 14 of Letters Patent. The second defendant/Judgment Debtor furthers his case in the 47 application, by saying that the borrowings of the first defendant with the plaintiffs cannot get amalgamated into one transaction, without leave under Clause 14 of Letters Patent. Though, this is the sheet anchor submission, certain other submissions were also advanced. (xii) The Decree Holder responded by taking the stand that the 47 application is not maintainable and is liable to be dismissed at the threshold. (xiii) Learned Master heard the rival submissions and by order dated 11.01.2011, held that maintainability can also be decided along with the main matter. Learned Master also held that maintainability can be decided only after letting in evidence. Aggrieved by the above, the Decree Holders preferred an appeal [numbered as A. No. 4315 of 2011] assailing the above said order of the learned Master. Justice Vinod K. Sharma, His Lordship as he then was, by order dated 21.10.2011, confirmed the order of the learned Master, who directed the disposal of the 47 application within a time frame. (xiv) Not satisfied, the Decree Holders carried the matter by way of an intra court appeal O.S.A. No. 401 of 2011. A Division Bench of this Court, in and by order dated 20.12.2011, set aside the above said order of the Single Judge and specifically directed the learned Master to decide the issue of maintainability, at the first instance. Thereafter, pursuant to the above said order of the Division Bench, learned Master passed an order dated 22.03.2012, holding that Section 47 application is maintainable. Thereafter, pursuant to the above said order of the Division Bench, learned Master passed an order dated 22.03.2012, holding that Section 47 application is maintainable. (xv) The above order of the learned Master dated 22.03.2012 has now been called in question in the instant application, namely, A.No. 3813 of 2012, which falls for consideration. In the interregnum, it is of relevance [for completion of facts] to state that the Decree Holders triggered off insolvency proceedings, owing to non satisfaction of the decree. Insolvency notice was issued on 16.08.2012. The same was called in question by way of an intra court appeal being O.S.A. No. 370 of 2012 and the said O.S.A. was disposed off by a Bench, presided by the Hon'ble Chief Justice, in and by order dated 15.09.2016. In and by this order, the Division Bench made an interim arrangement of Rs. 14 Lakhs security and insolvency notice has been kept under suspended, but, what is of relevance to the instant application is that, the Division Bench clearly held that the instant application being A.No.3813 of 2012 should be listed before the learned Single Judge and that the same should move. The instant application is thus, now before me. 5. Discussion: (i) The main submission of Mr. P.L. Narayanan, learned counsel appearing for the applicants herein, who are the Decree Holders is that the executing court cannot go beyond the decree. It is the further submission of the applicants/Decree Holders, on a demurrer though that even if the decree is a nullity, the various grounds that are being used now cannot be gone into, as that would amount to re-opening the suit post decree. (ii) Per contra, Mr. R. Thiagarajan, learned counsel appearing for the first defendant/Judgment Debtor No. 1 [first respondent herein] would contend [as stated supra in the factual matrix] that the decree is a nullity, as the plaintiffs did not obtain leave under Clause 14 of Letters Patent resulting in non amalgamation of the transaction, which in turn, resulted in the Original Side of this Court not having pecuniary jurisdiction to pass the decree. Certain other submissions regarding the issue of suit summons in the wrong format were also raised. It is the contention of the first respondent herein that all these go to the root of the matter and therefore, deserve to be examined at any stage of the proceedings. Certain other submissions regarding the issue of suit summons in the wrong format were also raised. It is the contention of the first respondent herein that all these go to the root of the matter and therefore, deserve to be examined at any stage of the proceedings. (iii) Mr.P.Gunaraj, learned counsel appearing for the second respondent herein would support the above said contentions of the first respondent. (iv) It is the further submission of the first respondent that a Court can decide a preliminary issue of maintainability only if it relates to jurisdiction or is barred by limitation. It is also submitted that Order 14, Rule 2 of CPC which deals with preliminary issue will not come into play, in a case of this nature, as the issue before the Court is, 'whether this Court has passed a decree which inherently lacks jurisdiction'". 6. With regard to the maintainability being decided, I am of the view that the learned counsel for the first respondent cannot now raise the issue that learned Master ought not to decide on maintainability, as the decision of the learned Master regarding maintainability, one way or the other, is pursuant to an order of the Division Bench of our Court dated 20.12.2011. Vide order dated 20.12.2011, the Division Bench in O.S.A. No. 401 of 2011 had categorically and specifically directed the learned Master to decide the issue on maintainability at the first instance. Paragraphs No.19, 20 and 21 being the three concluding paragraphs of the order of the Division Bench make this position very clear. It is deemed relevant to extract the same. The said paragraphs of the order of the Division Bench read as follows: "19. Considering the averment in application under Section 47 of CPC, the learned Master is directed to decide the maintainability of the application under Section 47 of CPC at first instance before going into the merits of the said application. So it is a fit case to set aside the order passed by the learned Single Judge. It is true, since the averment in application under Section 47 of CPC itself would raise the maintainability of Section 47 application, hence that to be decided at first instance. Hence we are of the view, the order passed by the learned Single Judge is liable to be set aside and accordingly, it is hereby set aside. 20. It is true, since the averment in application under Section 47 of CPC itself would raise the maintainability of Section 47 application, hence that to be decided at first instance. Hence we are of the view, the order passed by the learned Single Judge is liable to be set aside and accordingly, it is hereby set aside. 20. In fine, the appeal is allowed by setting aside the order of the learned Single Judge dated 21.10.2011 made in Appln. No. 4315 of 2011 in Appln. No. 554 of 2010 in E.P. No. 52 of 2004 in C.S. No. 571 of 1999. No costs. Consequently, the connected M.Ps are closed. 21. The learned Master is directed to decide the maintainability of application under Section 47 of CPC at first instance and dispose that application within a period of two months from the date of receipt of copy of this order, after giving due opportunity to both sides." 7. It is pertinent to notice that the above said order of the Division Bench came to be passed after full contest. Particularly, it came to be passed, after full participation and contest of both the Decree Holders and both the Judgment Debtors. Therefore, the submission that preliminary issue or maintainability cannot be raised or decided in a case of this nature and the further submission that Order 14, Rule 2 of CPC does not come into play, does not stand a moment is scrutiny. Such submissions have been stated only to be rejected. 8. I now proceed to examine the order of the learned Master wherein, the learned Master has held that 47 application is maintainable. Learned Master referred to above said order of the Division Bench and had held that 47 application being A. No. 544 of 2010 is maintainable for proceeding further, for determining the question of execut-ability of the decree, which is under challenge. Learned Master also held that the application at the first instance, is maintainable. 9. To this extent, the order of the learned Master or the procedure which, the learned Master adopted namely, a procedure of deciding the maintainability at the first instance, cannot be found fault with. It is strictly in accordance with and in adherence to the above said order of Division Bench of this Court. 9. To this extent, the order of the learned Master or the procedure which, the learned Master adopted namely, a procedure of deciding the maintainability at the first instance, cannot be found fault with. It is strictly in accordance with and in adherence to the above said order of Division Bench of this Court. Now, what falls for consideration in this application is, whether the learned Master was correct in holding that the application under Section 47 is maintainable" 10. As stated supra, besides the lack of leave under Clause 14 of Letters Patent proposition, my attention was also drawn to the fact that summons for Summary Suit have not been sent in the prescribed format, which also according to the first respondent is fatal. In support of such submissions of the first respondent, some judgments were pressed into service. They are, (i) Hamath Rai Brijraj and another v. Hirdai Narain Kumar and others reported in AIR 1993 Patna 242. (ii) Balvant N. Viswamitra and others v. Yadav Sadashiv Mule [Dead] Through LRs and others reported in 2005-3-L.W.20 : [2004] 8 SCC 706. (iii) Rafique Bibi [Dead] by Lrs v. Sayed Waliuddin [Dead] by Lrs and others reported in [2004] 1 SCC 287. (iv) Unreported judgment dated 10.07.2007 made by Justice V. Ramasubramanian in A.Nos.4663 and 4664 of 2006 in C.S.No.170 of 2004. 11. With regard to the unreported judgment of Justice V. Ramasubramanian, the same was rendered in dealing with an application seeking unconditional leave to defend in a Summary Suit under Order 37 of CPC. It cannot be in dispute that the parameters and determinants, which weigh for deciding an application seeking unconditional leave to defend are completely different from the parameters and determinants, which will weigh and come into play, in deciding an application under Section 47, assailing the decree passed in the Summary Suit. Therefore, this judgment does not help or further the case of the first respondent. 12. The other citations relied on by the first respondent for the proposition that the executing court would necessarily examine a decree, if it is pleaded that the decree is nullity or if it is pleaded that the decree has been obtained by fraud. Fraud is too vast a proposition. It is well settled that the pleadings for an allegation of fraud are in a different realm and that the same has to be done in great detail. Fraud is too vast a proposition. It is well settled that the pleadings for an allegation of fraud are in a different realm and that the same has to be done in great detail. In a case of this nature, particularly, in the light of the factual matrix that has been set out supra, I am of the view that the concept of fraud may not be attracted. Only issues of a nature, such as, non obtaining leave and issue of suit summons in the wrong format may arise. For these reasons, I hold that the other judgments pressed into service by the first respondent, are not of much help and assistance, for buttressing the proposition canvassed by the first respondent. 13. Learned counsel for the second respondent did not rely on any citations, but merely supported the contentions of the first respondent. 14. Per contra, learned counsel for the applicant relied on the following judgments : (i) Kiran Singh and others v. Chainan Paswan and others reported in AIR 1954 Supreme Court 340[1]. (ii) The Food Corporation of India, Rep, by its Senior Regional Manager, Madras-6 v. M/s. Mayavaram Financial Syndicate, Rep. by the Managing Partner, P. Kalyanasundaram reported in 1993-2 LW 453. (iii) Dhurandhar Prasad Singh v. Jai Prakash University and others reported in [2001]6 SCC 534.' (iv) Haryana Vidyut Prasaran Nigam v. Gulslwn Lal and others reported in [2009]13 SCC 354. (v) S. Ramesh Babu, Proprietor of Kanagarathna Movies, Chennai v. P. Changaiah, Proprietor, Ravi Prasad Unit, Chennai reported in 2013-3 L.W. 523 : 2013[4] CTC 59. 15. For the sake of brevity, I am not examining the facts and propositions in each of the above citations in detail. In pith and substance, the citations are for advancing the proposition that an executing court will not go beyond a decree and examine the validity and correctness of the decree qua the plea of nullity, even if the decree be a nullity. Such an extreme proposition was advanced, obviously on a demurrer. 16. In one of the citations, namely, Dhurandhar Prasad Singh v. Jai Prakash University and others reported in [2001] 6 SCC 534, it may be appropriate to extract one paragraph, where the Supreme Court held that the powers under Section 47 is microscopic and lies in a very narrow inspection hole. The relevant paragraph being paragraph No. 24 reads as follows : "24. The relevant paragraph being paragraph No. 24 reads as follows : "24. The exercise of powers under Section 47 of the Code is microscopic and lies in a very narrow inspection hole. Thus it is plain that executing court can allow objection under Section 47 of the Code to the executability of the decree if it is found that the same is void ab initio and a nullity, apart from the ground that the decree is not capable of execution under law either because the same was passed in ignorance of such a provision of law or the law was promulgated making a decree in-executable after its passing. In the case on hand, the decree was passed against the Governing Body of the College which was the defendant without seeking leave of the court to continue the suit against the University upon whom the interest of the original defendant devolved and impleading it. Such an omission would not make the decree void ab initio so as to invoke application of Section 47 of the Code and entail dismissal of execution. The validity or otherwise of a decree may be challenged by filing a properly constituted suit or taking any other remedy available under law on the ground that the original defendant absented himself from the proceeding of the suit after appearance as he had no longer any interest in the subject of dispute or did not purposely take interest in the proceeding or colluded with the adversary or any other ground permissible under law." 17. In another judgment, being Haryana Vidyut Prasaran Nigam's case reported in [2009] 13 SCC 354, the Supreme Court speaking through Justice S.B. Sinha as His Lordship then was, went as far as holding that an executing court should execute the decree strictly in terms thereof, even if the Decree Holders would not have been legally entitled to the reliefs prayed for by them. Such a proposition was laid down by the Supreme Court, in a suit arising out of a complaint of pay parity between similarly placed persons. The question was, whether the Civil Court travelled beyond the scope of the plaint and passed the order which it ultimately did? After thorough examination of the entire conspectus of Section 47, the Supreme Court laid down the law as set out above. The question was, whether the Civil Court travelled beyond the scope of the plaint and passed the order which it ultimately did? After thorough examination of the entire conspectus of Section 47, the Supreme Court laid down the law as set out above. One short and cryptic paragraph can be usefully extracted i.e., paragraph No. 21 of the said judgment and the same reads as follows : "21. We are not obvious of the fact that the respondents legally would not have been entitled to the reliefs prayed for by them. However, as a decree has been passed, we do not intend to go behind the same. The executing court shall, it goes without saying, execute the decree strictly in terms thereof." 18. As stated supra, the other judgments also have been pressed into service for advancing the above proposition. 19. I have heard the submissions made by learned counsel on either side elaborately. I have also examined the entire gamut of facts and the law applicable to the instant case. 20. One crucial aspect in my opinion, is a tilting factor in this case. That crucial aspect is that the second defendant admittedly/concededly, took out an application seeking unconditional leave to defend the suit vide A. No. 2002 of 2000 and the same was dismissed. Therefore, the attempt on the part of the second defendant to get unconditional leave, failed. To top it all, such failed attempt has admittedly been given legal quietus. 21. With the above said crucial tilting factor in mind, on further examining the length and breadth of this matter, I am persuaded to hold that Section 47 application in the instant case, is not maintainable and that the learned Master was not correct in holding otherwise. 22. Findings: The reasons for persuading myself to hold that the learned Master erred are as follows: (i) The second defendant has applied for unconditional leave, vide A. No. 2002 of 2000 and failed. Admittedly, this has been given legal quietus. It has attained finality. Concededly, all the points that are now being sought to be raised by the first defendant/judgment Debtor No. 1 were raised in the leave to defend application. This aspect has been completely ignored and not considered at all by the learned Master. (ii) This is a Summary Suit. Defence is not a matter of right for the defendants. Concededly, all the points that are now being sought to be raised by the first defendant/judgment Debtor No. 1 were raised in the leave to defend application. This aspect has been completely ignored and not considered at all by the learned Master. (ii) This is a Summary Suit. Defence is not a matter of right for the defendants. In other words, the defendants have to earn their right of defence by convincing the court that their defence is not mere moonshine and that they have a valid defence. Therefore, what the defendants will have to earn in the main suit by convincing the court that the defence is not moonshine, cannot be now made available to the defendants freely at the execution stage. More so, when one of the defendants have raised the issue and failed. 23. As a corollary to the above two reasons, I am of the view that it is axiomatic that, holding Section 47 application to be maintainable and holding a wide and elaborate enquiry in the same by letting in oral and documentary evidence, would amount to re-opening the suit and virtually defeat the concept of a Summary Suit, based on Negotiable Instruments. 24. The proposition laid down by the Supreme Court in Haryana Vidyut Prasaran Nigam's case that the executing court should execute the decree strictly in terms thereof, even if the Decree Holders may not be entitled to the reliefs prayed for by them, nails the issue. Lastly, the Summary Suit has been launched on 14.06.1999 and a decree has been passed on 24.04.2002. We are now in 2016. It would be completely undesirable to re-open the whole matter at this stage, at this distant point of time, on allegations of certain lapses in launching of the suit and passing of the decree. 25. Conclusion: In the light of the discussions above, on the factual matrix set out supra and owing to the findings above, I hold that the order of the learned Master dated 22.03.2012 made in A. No. 554 of 2010 in E.P. No. 52 of 2004 in C.S. No. 571 of 1999 is liable to be set aside. 25. Conclusion: In the light of the discussions above, on the factual matrix set out supra and owing to the findings above, I hold that the order of the learned Master dated 22.03.2012 made in A. No. 554 of 2010 in E.P. No. 52 of 2004 in C.S. No. 571 of 1999 is liable to be set aside. As a consequence, it follows that A. No. 554 of 2010 in E.P. No. 52 of 2004 in C.S. No. 571 of 1999 that has been filed invoking the provisions of Section 47 of CPC is not maintainable and is liable to be dismissed at the threshold. In other words, Application No. 3813 of 2012 is allowed. Considering the trajectory the litigation has taken and the nature of submissions that were advanced in the instant application, the parties are left to bear their respective costs.