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1929 Supreme(Mad) 311

IN THE HIGH COURT OF MADRAS
A Ayyar
Natesa Pillai
Versus
Govindasami Pathan
Decided On : 27 August, 1929

Headnote:

Section 73 - Civil Procedure Code - 373, 301, 445, 259, 30, 14, 22 - The judgment discusses the application of Section 73 of the Civil Procedure Code in a case involving multiple decree-holders seeking rateable distribution of funds held by the court. The court analyzed the rights and liabilities of the parties involved, the powers of receivers appointed by the court, and the effect of such appointments on the distribution of assets. The court emphasized that the appointment of a receiver does not confer exclusive rights to the funds and that all decree-holders who have applied for execution of decrees against the same judgment-debtor are entitled to share rateably in the assets held by the court, provided applications for execution are made before the receipt of such assets.

Fact of the Case:

The case involved multiple decree-holders seeking rateable distribution of funds held by the court. The plaintiff, defendant 1, and defendant 2 were all claiming entitlement to a portion of the assets from a specific decree.

Finding of the Court:

The court found that all the decree-holders were entitled to share rateably in the funds held by the court, rejecting the exclusive claim of defendant 2. The court emphasized that the appointment of a receiver does not confer exclusive rights to the funds and that all decree-holders who have applied for execution of decrees against the same judgment-debtor are entitled to share rateably in the assets held by the court, provided applications for execution are made before the receipt of such assets.

Issues: The main issue was the entitlement of the decree-holders to rateable distribution of the funds held by the court, particularly in the context of the appointment of a receiver and the effect of such appointment on the rights of the parties.

Ratio Decidendi: The key legal principle established in the judgment is that all decree-holders who have applied for execution of decrees against the same judgment-debtor are entitled to share rateably in the assets held by the court, provided applications for execution are made before the receipt of such assets.

Final Decision: The second appeal was allowed, the decision of the lower appellate Court was reversed, and that of the 1st Court was restored. Defendant 2 in the second appeal was ordered to pay the plaintiff's costs in this and in the lower appellate Court.

JUDGMENT

Anantakrishna Ayyar, J.

1. This second appeal raises a question of some importance under Section 73, Civil P.C.

2. The plaintiff is the appellant in the second appeal. Defendant 2, Govindasami obtained a money decree in O.S. No, 373 of 1914 on the file of the Tiruvarur District Munsifs Court and had the decree transferred to the District Munsifs Court, Tiruthuraipundi for execution by the attachment of a mortgage debt due to the judgment-debtor (Namasivayam Chetty) by Veerappa Thevan on a hypothecation deed. The mortgage-debt was attached, and Govindasami himself (Defendant 2) was appointed receiver to collect the attached debt. The terms of the order of appointment of the receiver are important: see Ex. B dated 29th April 1916:

I appoint the petitioner as receiver to collect the debt as prayed for. He should pay the realized debt into Court and take out the realized sum after taking the further orders of the Court.

3. The receiver filed O.S. No. 259 of 1917 on the file of the Tiruthuraipundi District Munsifs Court to recover the money due on the mortgage bond, got a final decree on 8th August 1921 and took out execution of the decree by E.P. No. 445 of 1921 on 5th November 1921. The execution petition was, however, dismissed on 5th April 1922.

4. Defendant 1, Thandavaraya got a money decree against Namasivaya Chetty in O.S. No. 372 of 1914 (Tiruvarur District Munsifs Court), on 14th November 1914. He attached on 10th July 1922, the decree in O.S. No. 259 of 1917. After attachment he applied in the District Munsifs Court of Tiruthuraipundi by E.P. No. 301 of 1922 for execution of the decree in O.S. No. 259 of 1917. The full decree amount of O.S. No. 259 of 1917 was paid into the Tiruthuraipundi District Munsifs Court on 6th October 1922.

5. Natesa Pillai, the appellant in the second appeal, got a money decree against Namasivaya Chetty in O.S. No. 30 of 1916 on the file of the Tiruvarur District Munsifs Court and attached on 9th November 1922 (the amount in Court in O.S. No. 269 of 1917) by a precept from the Tiruvarur Court and got his decree transferred for execution to the Tiruthuraipundi District Munsifs Court on 12th December 1922. Natesa Pillai applied by E.A. No. 813 of 1922 to the District Munsif of Tiruthuraipundi for rateable share in the amount in Court, being the decree amount in suit O.S. No. 259 of 1917.

6. Accordingly the District Munsif of Tiruthuraipundi had to consider the rights of;

(a) Govindasami, the decree-holder in O. Section 373 of 1914.

(b) the rights of Thandavaraya, the decree-holder in O.S. No. 372 of 1914, and

(c) the rights of Natesa Pillai, the decree-holder in O.S. No. 30 of 1916.

7. Govindasami claimed the whole of the amount in Court; whereas Thandavaraya claimed rateable distribution, as also Natesa Pillai. The District Munsif of Tiruthuraipundi passed an order (Ex. F) on 22nd December 1922 to the effect that the amount in Court should be distributed among Govindasami and Than davaraya rateably, but that Natesa Pillai was not entitled to share in the same. This is what he said:

The attachment in E.A. No. 813 of 1922 (Natesa Pillais) has been made after the money was deposited in Court; E.A. No. 813 of 1922 is dismissed. From the amount realized, deduct the costs of the suit (O. Section 259 of 1917); and in the balance allow rateable distribution between Govindasami and Thandavaraya.

8. Natesa Pillai filed the present suit (O.S. No. 14 of 1923), on the file of the Tiruthuraipundi District Munsifs Court against Thandavaraya (defendant 1) and Govindasami (defendant 2), under Section 73, Civil P.C., to compel the defendants to refund a portion of the assets to the plaintiff, on the ground that all the three persons (plaintiff, defendant 1 and defendant 2) were entitled to rateable share in the amount of the decree in O.S. No. 259 of 1917 in Court, and that defendants 1 and 2 were not entitled to share the same to the exclusion of the plaintiff.

9. The District Munsif (who was the successor in office of




































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