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1952 Supreme(Nagpur) 53

HIGH COURT OF NAGPUR
Sinha, Hidayatullah, Mudholkar
RAMJI SITARAM MAHAR, JUDGMENT-DEBTOR – Appellant
Versus
AMOLAKCHAND BANSILAL DHELIA, DECREE-HOLDER – Respondent
Miscellaneous Second Appeal No. 160 of 1948
Decided on : 18-04-1952

Advocates Appeared:
G J Ghate, V T Kedar, Advocates

An agreement to pay a debt in kind is not executable as a decree from the moment it is registered under section 122. of the Debt Conciliation Act.

Headnote:

DEBT CONCILIATION ACT - AGREEMENT - EXECUTION - AGREEMENT TO PAY DEBT IN KIND - WHETHER EXECUTABLE AS DECREE - SECTION 12, 13 - INTERPRETATION.

Fact of the Case:

Appellant, who owed money to several persons, applied to the Debt Conciliation Board for conciliation of his debts. An agreement was reached between the appellant and his creditors, providing for payment of debts due to the respondent and another creditor in 18 annual installments, and upon failure of any installment, the appellant was to lease out a certain field to the creditor concerned for one year. The appellant failed to pay the installment due on 10th March 1948 and the respondent applied for a warrant for possession of the field. The appellant deposited the sum of Rs. 100 plus the costs of execution, which the respondent refused to accept. The executing Court held that the respondent was not bound to accept the amount and asked the appellant to withdraw it. The appellant preferred an appeal to the District Judge who dismissed it.

Finding of the Court:

The Court held that the agreement to pay the debt in kind is not executable as a decree from the moment it is registered under section 122. of the Debt Conciliation Act. The Court further held that the only channel for executing an agreement entered into under section 121. of the Act is that provided by section 13. The Court also held that where an agreement provides for the payment of a debt otherwise than in cash it cannot take effect as a decree under section 122.

Issues: Whether an agreement providing for payment of a debt in kind is executable as a decree from the moment it is registered under section 122. of the Debt Conciliation Act.

Ratio Decidendi: The Court held that the word 'amount' used in Section 12 must be given its natural meaning and not the wide meaning given to it by Stone C. J. Mid Bose J. This is implicit in the decision of Mangalmurti and Deo JJ. The Court further held that the only way in which an agreement arrived at under Section 121. can be enforced is that laid down by Section 13, and Section 13 is not applicable to a case where the agreement provides for payment in kind.

Final Decision: The Court answered the question referred to the Full Bench in the negative.

JUDGMENT

Mudholkar, J—This is a judgment-debtor's appeal and arises out of execution proceedings.

2. The relevant facts are briefly these. The appellant who owed money to a large number of persons made an application to the Debt Conciliation Board for conciliation of his debts. Eventually, an agreement was reached between the appellant and his creditors. The agreement was duly registered on the 19th February 1938 under section 12(2). of the C.P. and Berar Debt Conciliation Act. The agreement provided, among other things, that the debts due to the respondent and to another creditor by name Hiralal were to be paid off in 18 annual instalments and that the appellant was to pay each of them Rs. 100 per annum. It further provided that upon failure of any instalment on or before the 10th of March of any year, the appellant should lease out a certain field to the creditor concerned for one year.

The appellant failed to pay the instalment due on 10th March 1948 within time and so the respondent applied for a warrant for possession of the field which was argeed to be leased out to him. The execution Court issued a warrant whereupon the appellant deposited in Court the sum of Rs. 100 plus the costs of execution. The respondent refused to accept the amount. The executing Court held that the respondent was not bound to accept the amount and asked the appellant to withdraw it. The appellant then preferred an appeal to the District Judge who eventually dismissed it. He has now come up in Second Appeal.

3. The point taken by the learned Counsel for the appellant is that an agreement executed before the Debt Conciliation Board can be executed as a decree of a Court only after the Deputy Commissioner certifies that the amount payable thereunder is irrecoverable and that in the absence of such a certificate the agreement cannot be executed as a decree. A similar argument was advanced before the lower appellate Court but was repelled on the authority of the decision in KHUSHALCHAND v. HARI ,1943 ILR(Nag) 696. In that case Pollock J. held that an agreement under Section 12 of the Central Provinces Debt Conciliation Act takes effect from the date of its registration as if it were a decree of a civil Court and thereafter is executable as such. This decision has been held, in SHANTABAI v. MADHAORAO, 1951 AIR(Nag) 121 to have been impliedly overruled by the decision in 'HUKUMCHAND v. JIWANPURI', L.P.A. No. 11 of 1943. In that case it was observed:

Section 13 does not provide an alternative remedy or a parallel remedy to execution in Civil Courts but provides the only channel for execution..... If recourse to section 13 is to be taken as an alternative remedy to regular execution, the anomalous position is then reached that by section 134. the original decree of instalments is superseded by a more onerous decree whereas the original decree of instalments would still be executable by the civil Courts. Such a supersession of one decree by another can in our opinion only be permissible if the jurisdiction of the civil Courts to execute arises only as the result of action taken under sub-sections 3. and 4. of section 13, whereby the original decree is superseded and does not continue to exist alongside the superseding decree.

4. The decision in SHRIDHAR v. NARAYAN ,1939 ILR(Nag) 503 however supports the contention of the respondent. There it was held that when an amount is payable in kind the agreement to pay it is enforceable as a decree by the civil Court from the moment it is registered. The agreement in the present case is twofold: first it provides for the payment of money and then it provides that upon default the creditor will be entitled to a payment in kind. The respondent is seeking to enforce the agreement for payment in kind as if it were a decree of a Civil Court. According to this decision, he must be held to be entitled to do so. I would however point out that the decisions in 'HUKUMCHAND v. MAHANT JIWANPURI', LPA No. 11 of 1943 D/- 19-9-1947 and



























































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