Decided on August 08,1955



- (1.) This appeal arises out of the proceedings to execute the decree in O.S. 92 of 1115, on the file of the Alleppey District Court. The said decree is one for payment of money and it awarded interest on the decretal amount until payment. On 20.3.1122 the present appellant (Judgment - debtor No. (2)) deposited in court an amount of Rs. 1,500/- for payment to the decree holder towards the amounts due under the decree. The court while directing credit to be given for the amount, ordered noticed to be given to the decree holder about the deposit. No notice was however issued as the judgment debtor did not pay the process fees. The appellant thereafter made three further payments into court on different dates, but the petitions filed in that behalf contained no reference to the deposit made on 20.3.1122. On 17.12.1129 (2.8.1954) the decree holder filed an execution application claiming the amounts which according to him were still due. As the decree holder was not aware of the deposit made on 20.3.1122 the balance claimed by him was without taking into account the amount of the said deposit. When the appellant got notice of the execution application, he filed his objections, contending inter alia that the amount deposited on 20.3.1122 should be given credit towards the decree on the date of the deposit itself and that he was therefore liable only for the balance due after deducting the said sum with interest thereon from the amount shown in the execution application. This objection was filed on 29.4.1130 (14.12.1954). The decree holder contested the matter stating that the amount deposited on 20.3.1122 should cease to carry interest only from the date of the judgment debtors objection, on which date alone he had notice of the deposit. The learned District Judge accepted the decree holders position, and held that the judgment debtor was liable for interest on the amount of the deposit in question at the rate specified in the decree till the date he filed his objection viz., 14.12.1954. This order it is that is challenged in the appeal.
(2.) The question is whether in the case of a decree which awarded interest on the decretal amount until payment, interest ceases to run from the date of deposit into court, although notice of the deposit has not been given to the decree holder. The decisions bearing on the point are not uniform, but as we shall presently show there is large preponderance of opinion for the view that interest will cease to run only from the date the decree holder has notice of the deposit. The relevant provision of law on the matter is to be found in O.21 R.1, of the Code of Civil Procedure, Act V of 1908. The said rule consists of 2 parts and the rule is in these terms: (1) All money payable under a decree shall be paid as follows, namely: (a) into the court whose duty it is to execute the decree; or (b) out of court to the decree holder (by postal money order or on a registered receipt); Travancore - Cochin amendment or (c) otherwise as the court which made the decree directs. (2) Where any payment is made under Cl. (a) of sub-r. (i), notice of such payment shall be given to the decree holder.
(3.) In this case the mode of payment adopted by the judgment debtor was that contemplated by R.1(i)(a) viz., payment into the court of execution. With reference to such payment Cl. (2) enjoins that notice of it shall be given to the decree holder. It is not stated as to who should give the notice, but for reasons which are obvious the responsibility for it can only be that of the judgment debtor. Unlike the provision in O.24 R.3, O.21, R.1 does not state that when notice of the deposit is given to the party entitled to the money, interest shall cease to run on the amount deposited. However, reading the provision in O.21, R.1(i)(a) together which Cl. (2), it looks fairly clear that when a judgment debtor chooses to deposit the amount due as per a decree into the court of execution, the payment becomes effective only from the date of the notice. The reason for the provision as to notice is to enable the decree holder to withdraw the money due to him, so that he may make use of it in the manner he deems proper. Where interest is awarded by the decree on the decretal amount until payment, we cannot find any valid reason for refusing to pay the decree holder the interest that is due to him until such time as he is in a position to receive the money into his hands and make use of it. If the payments were made direct to the decree holder he could make immediate use of the money and we cannot find any justification for depriving the decree holder of the just compensation allowed to him by the decree for his being kept out of his money, because the judgment debtor chooses a particular method of paying it to him. This is the view which commended itself to two learned Judges of the Madras High Court (Old field and Seshagiri Ayyar, JJ.) when the question came up before them in the case reported in ILR 1919 (XLII) Madras 576. Seshagiri Ayyar, J. expressed the view that the principle behind R.3 of O.24, can very well be applied to payments in the course of execution proceedings, especially as O.21, R.1(i)(a) does not say that by the payment, satisfaction of the claim of the decree holder is ipso facto entered. To our minds the provision for notice in Cl. (2) is sufficient indication that the decree holders right cannot be affected until he is informed that the decree amount is available for him and that he can draw it out of court. Unless the rule is understood in this light, Cl. (2) will be rendered nugatory. No sanction to compel the judgment debtor to comply with Cl. (2) will be there, unless the rule is so understood.;

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