ANDHRA PRADESH HIGH COURT AT AMARAVATI
B.V.L.N. Chakravarthi, J.
Margadarsi Chit Fund – Appellant
Versus
K. Narendra Kumar – Respondent
Civil Revision Petition No. 1719 of 2015
Decided On : 18-04-2023
EXECUTION OF DECREE - JOINT AND SEVERAL LIABILITY - SECTION 128 OF THE INDIAN CONTRACT ACT, 1872 - DECREE-HOLDER'S RIGHT TO PROCEED AGAINST ANY ONE OF THE JUDGMENT-DEBTORS - COURT'S ANALYSIS AND CONCLUSION - RATIO DECIDENDI - FINAL DECISION
Fact of the Case:
Decree-holder filed an execution petition against one of the judgment-debtors, who was jointly and severally liable for the decree amount, leaving out the other judgment-debtors. The judgment-debtor contended that it was not just and proper to proceed against her alone, as it would cause hardship.
Finding of the Court:
The court held that the decree-holder had the right to proceed against any one of the judgment-debtors, as their liability was co-extensive. The court also held that the judgment-debtor did not have the right to dictate terms to the decree-holder as to how he should pursue his remedies.
Issues: Whether the decree-holder was entitled to proceed against one of the judgment-debtors, leaving out the other judgment-debtors, who also suffered a joint and several decree.
Ratio Decidendi: The court relied on Section 128 of the Indian Contract Act, 1872, which states that the liability of the surety is co-extensive with that of the principal debtor, unless it is otherwise provided by the contract. The court also relied on several judgments of the High Court and the Supreme Court, which held that the decree-holder has the liberty to recover the money against any one of the judgment-debtors.
Final Decision: The court allowed the revision petition and set aside the order of the trial court, which had dismissed the execution petition. The court directed the trial court to proceed with the execution petition and dispose of it in accordance with law.
JUDGMENT
B.V.L.N.CHAKRAVARTHI, J. - Heard Sri P.Durga Prasad, learned counsel for revisionpetitioner/decree-holder and Sri T.Sri Charan, learned counsel for respondent No.2/judgment-debtor No.2.
2. The contention of revision-petitioner/decree-holder is that as per the decree passed against the judgment-debtors, all of them are jointly and severally liable for the decree amount but none of them discharged the decree amount, and therefore, execution petition was filed against the respondent No.2/ judgment-debtor No.2 who is working as Senior Medical Officer, SVIMS, Tirupati, for realization of the decree debt, as her liability towards the decree amount is coextensive with that of the other judgment-debtors.
3. The contention of respondent No.2/judgment-debtor No.2 is that the revision-petitioner/decree-holder filed execution petition against respondent No.2/judgment-debtor No.2 alone, by leaving the other judgment-debtors, and therefore it is not just and proper.
4. The learned Trial Court Dismissed" the execution petition filed by the revision-petitioner/decree-holder on 21/11/2014 by considering the judgement in Jaichand T.Gangwal vs. Shriram Chits Private Limited and others,2013 (6) ALT 798. relied by the respondent No.2/judgment-debtor No.2, observing that if other judgmentdebtors are omitted from the array of the parties in the execution petition, the one who is singled out would face hardship and thereby gave a finding that filing of execution petition against judgment-debtor No.2 by leaving out judgment-debtor Nos.1, 3 to
5. will cause hardship to judgment-debtor No.2. 5. In the light of above rival contentions, the point that would arise in the revision-petition is as under: -
"Whether the Trial Court committed any material irregularity in the Order, dtd. 21/11/2014 passed in E.P.No.71 of 2013 in O.S.No.449 of 2008?"
6. P O I N T: - There is no dispute about the joint and several liability of all the judgment-debtors in discharging the debt due under the decree as ordered by the Trial Court in O.S.No.449 of 2008. Accordingly, the decree-holder proceeded against the judgmentdebtor No.2, who is respondent No.2 herein, seeking to attach her salary, as she is being one of the guarantors towards the debt due by the principal debtor.
7. Now, it must be seen whether the decree-holder is entitled to proceed against the judgment-debtor No.2 only, leaving the other judgment-debtors, who also suffered a joint and several decree.
8. The learned counsel for revision-petitioner/decree-holder placed reliance on the decision rendered by this Court in Punyamuthula Venkata Viswa Sundara Rao and another vs. M/s. Margadarsi Chit Fund Private Limited and others,2017 (3) ALT (DB) 81 = 2017 (3) ALD 387 = 2017 (2) HLT 106. wherein it was held as under:
"The law is well settled otherwise i.e., that the decree-holder has an option to proceed against either the principal debtor or any of the guarantors or against all of them. There need to be no interpretative pains, to arrive at the conclusion that the liability of a surety is co-extensive with that of the principal debtor, as Sec. 128 of the Indian Contract Act is clearly worded. It says that the liability of the surety is co-extensive with that of the principal debtor unless it is otherwise provided by the contract."
9. Further, in Shriram Chits Private Limited vs. Manuri Ravi and other,[CRP No.6499 of 2016, dtd. 30/8/2016 on the file of High Court of Judicature, For the State of Telangana and For the State of Andhra Pradesh at Hyderabad.] which is rendered by this Court, at para-No.3 referred the Judgment of this Court"s Division Bench in Chalapathi Chit Fund Private Limited, Guntur vs. Adusumalli Malleswara Rao and three others (CRP No.2980 of 2009) held as under:
"In the above Division Bench Judgment of this Court, after a review of the entire case law, their Lordships held that where judgment-debtors suffered a joint and several decree, the decree-holder is at liberty to recover the money against
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A decree-holder has the right to proceed against any one of the judgment-debtors, who are jointly and severally liable for the decree amount, without impleading the other judgment-debtors.
The decree holder can proceed against any one of the judgment-debtors and is not required to proceed against the principal borrower at the first instance.
Contract of Guarantee, unlike a contract of indemnity, which is bilateral, is a tri-party where three persons viz., the principal debtor, the creditor and surety are involved.
Point of Law : Code of Civil Procedure does not insist a decree holder to implead all the defendants in the suit as the judgment debtors in the execution petition to execute a joint and several decre....
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