IN THE HIGH COURT OF PUNJAB AND HARYANA
Before
The Hon’ble Mr. Justice K. Kannan
C.R. No.6430 of 2012
Mahender Kumar son of Nand Lal
v.
Mangal Singh son of Sh. Hem Ram
{Decided on 19/03/2013}
(A) Transfer of Property Act, 1882, S.55(4)(b)--Creation of charge on property in terms of compromise decree--Held, parties were bargaining for a compromise with their eyes open and when judgment debtor had provided that he will not mortgage or sell property and that a charge was being created and if any money was not paid property could be sold, party definitely understood that charge was being created on property--Even otherwise a charge on property which is agreed to be sold that ultimately does not go through to allow for vendor to secure money back obtains to him also a statutory charge u/s.55(4) (b) of the Transfer of Property Act--Civil Procedure Code, 1908, S.60(1)(ccc). (Para 4)
(B) Transfer of Property Act, 1882, S.55(4)(b)--Creation of charge on property in terms of compromise decree--Charge which statute recognizes becomes also a charge under decree when vendor was bargaining for return of money which he had advanced--Civil Procedure Code, 1908, S.60(1)(ccc). (Para 4)
(C) Civil Procedure Code, 1908, S.60(1)(ccc)--Attachment of residential house--Compromise decree passed in suit for specific performance sought to be executed--Plea by judgment debtor that since property sought to be attached is a residential house, protection of State Amendment u/s.60(1)(ccc) available to judgment debtor--Held, plea liable to be rejected--A decree that forms compromise must be understood as providing for everything that compromise itself provides for unless compromise terms are unworkable or against public policy--Property directed to be sold for recovery of money which is still payable. (Paras 1, 2, 4 & 8)
Mr. K. Kannan, J. (Oral):- The revision petition is directed against the proceedings for attachment and sale of the property, which is admittedly residential house of the judgment debtor. The defence by the judgment debtor is that in terms of Section 60 (1) (ccc) of the Code of Civil Procedure by the Punjab Amendment, one main residential house and other buildings attached to it belonging to a judgment debtor other than an agriculturist and occupied by him, shall be protected from attachment. The contention is that since the property sought to be attached is a residential house, protection of the State amendment avails to a judgment debtor. This objection was accepted and the attachment sought by the decree holder was denied. It is against this order of the Executing Court that the revision has been filed.
2. The decree, which is sought to be executed was the compromise decree in a specific performance suit. The suit for specific performance at the instance of the decree holder was in relation to the residential house agreed to be sold by the defendant to the plaintiff. The parties entered into a compromise on 07.01.2004 allowing for the defendant to pay Rs. 66,000/- to the plaintiff in installment of Rs. 2000/- per month and the compromise specifically recites, “till then the defendant will not sale, mortgage the house in question to anybody and the charge shall remain created on the house and if the defendant failed to pay the installment in time then the plaintiff has right to file the execution application before the Court for recovery of the balance amount......” Towards the end the document also reads that the plaintiff will have also the right to recover the balance amount by way of auction of the house in question. When there is a reference specifically made in the compromise that a charge was being created on the property for the liability, which the defendant had undertaken then it is to be seen whether it falls within the proviso mentioned under Section 61(1)(ccc). The proviso would require to be reproduced which reads as follows:-
“Provided that the protection afforded by this clause shall not extend to any property specifically charged with the debt sought to be recovered.”
In my view, the recital extracted from the compromise decree squarely falls within the proviso and the protection which the defendant was asking was simply not available to him.
3. A faint argument is made on behalf of the judgment debtor that the compromise is required to be registered and it was not so registered. Section 17 (2) (vi) of the Registration Act, 1908 reads as follows:-
“(vi) any decree or order of a Court [except a decree or order expressed to be made on a compromise and comprising immovable property other than than which is the subject matter of the suit or proceeding].”
This Section requires only a registration of compromise, which is not the subject matter in respect of which a right is created for the first time through the decree. In a suit for specific performance where the immovable property in dispute was ultimately allowed to be retained by the judgment debtor with a charge created thereon, it cannot be said to be a property which is not the subject mater to which the above provision of the Registration Act is applicable. The plea therefore that the decree was required to be registered is erroneous and rejected.
4. Learned counsel appearing for the respondent also argues that when the decree was passed it was merely a decree for money and the charge which existed prior to the decree was no longer available under the decree. It is clear misreading of the terms of compromise on the basis of which a decree also came to be passed. A decree that forms the compromise must be understood as providing for everything that the compromise itself provides for unless the compromise terms are unworkable or against public policy. The parties were bargaining for a compromise with their eyes open and when the judgment debtor had
SupremeToday
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.