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2024 Supreme(Online)(Bom) 6814
HIGH COURT OF BOMBAY
AMIT BORKAR, J
SHARADCHANDRA RAMKRISHNA DESHMUKH – Appellant
Versus
M/S. KULDEEP BUILDERS AND ORS – Respondent
WP/10926/2014
Mr. Vijay D. Patil with Mr. Yogesh Patil for the Petitioner. Mr. Amey Deshpande i/b Mr. Ajit V. Mandlik for Respondent Nos. 1 to 4.
The Executing Court must calculate interest on the decretal amount until realization, without premature deductions, adhering strictly to the decree's terms.
Headnote:(A) Code of Civil Procedure, 1908 - Order XXI - Execution of Decrees - The Executing Court erred in restricting interest calculation to the date of counter-claim and deducting amounts payable before interest calculation, contrary to the decree's explicit terms. (Paras 5, 15)
(B) The decree-holder is entitled to recover the balance amount with interest calculated on the reduced principal until full realization. (Paras 16, 17)
Facts of the case:
The petitioner challenges the Executing Court's order regarding interest calculation and deductions from the principal amount in a decree involving reciprocal liabilities.
Findings of Court:
The Executing Court's order is quashed, and recalculation must adhere to the decree's terms and relevant provisions of CPC.
Issues: Whether the Executing Court correctly interpreted the decree regarding interest calculation and deductions.
Ratio Decidendi: The court ruled that interest must be calculated until realization as per the decree, and adjustments should occur after determining total amounts payable.
Result: The impugned order is quashed, and recalculation is directed.
| Table of Content |
|---|
| 1. petitioner challenges executing court's order (Para 1 , 2) |
| 2. judgment-debtor's application for adjustment (Para 3) |
| 3. decree-holder contests calculation (Para 4) |
| 4. executing court's reliance on cpc (Para 5) |
| 5. mr. patil's submission on error of law (Para 6 , 7) |
| 6. mr. deshpande supports executing court's interpretation (Para 8 , 9) |
| 7. relevant provisions of cpc (Para 10) |
| 8. analysis of order xxi rule 19 (Para 11) |
| 9. executing court's application of provisions (Para 12) |
| 10. court's ruling on interest calculation (Para 13 , 14 , 15) |
| 11. impugned order quashed (Para 16 , 17 , 18) |
JUDGMENT:
1. By this writ petition under Article 227 of the Constitution of India, the petitioner, being the decree-holder, challenges the judgment and order dated 24th September 2014 passed by the Executing Court. The Executing Court, while adjudicating the amount payable by the judgment-debtor, calculated interest awarded under the decree only up to the date of the counter- claim, i.e., 10th January 2001, and deducted the amount of Rs. 17,00,000/- payable by the decree-holder to the judgment-debtor from the principal amount.
2. The facts and circumstances relevant for adjudication of the issue involved are as under:
The Petitioner, as a decree-holder, initiated Special Civil Suit No. 419 of 2000 in the Court of Civil Judge Senior Division, Pune, seeking declaratory relief and permanent injunction. The suit arose from a development agreement between the parties, where disputes emerged over payments, construction work, and mutual obligations. After a detailed examination of the pleadings, evidence, and arguments, the Trial Court delivered its judgment on 31st March 2005, partly decreeing the suit. The operative part of the decree was as follows :
“1. The suit is hereby partly decreed as under:
2. Defendants shall pay an amount of Rs.44,0,750/- (Rs. Forty four lakh seven Hundred Fifty only) to the plaintiff along with interest at ther ate of Rs.18% per annum only on the principle amount Rs.38,00,000/- (Rs. Thirty Eight Lax only) from 12.2.2000 to till its realisation towards the consideration amount of development agreement.
3. Defendant shall pay an amount of Rs.15,00,000/- (Rs. Fifteen Lac only) to the plaintiff along with interest at the rate of Rs.18% per annum from the date of suit i.e. 17 th April 2000 to till its realisation towards the amount for completing remaining construction work.
4. Defendant shall pay amount of Rs.5,84,000/- (Rs. Five Lac Eighty Four Thousand only) to the plaintiff along with interest at the rate of Rs.18% per annum from the date of the suit to till its realisation.
5. Charge of the decree is created on the North West and North East wing of the suit property and an property bearing CTS NO.557, Sadashiv Peth, Pune described in Schedule of Exh. 5 Rest claim of the plaintiff stands rejected.
6. Plaintiff shall pay an amount of Rs.17,00,000/- (Rs. Seventeen Lac only) to the defendants. Plaintiff and defendants can adjust this amount against the amount payable by the defendant to the plaintiff.
7. Rest claim of the defendants stands rejected
8. Defendant shall pay the suit and bear his own.
9. Decree be drawn up accordingly.”
3. During the execution proceedings, the judgment-debtor filed an application quantifying the net amount payable as Rs. 1,41,04,970, asserting that Rs. 17,00,000/- payable by the decree- holder to the judgment-debtor must be deducted from the principal amount before calculating interest and that the interest on the decretal amount should be calculated only up to the date of the counter-claim, i.e., 10th January 2001.
4. The decree-holder contested this calculation, arguing that the deductions and limitations proposed by the judgment-debtor are contrary to the express terms of the decree. It was submitted that the decree mandates interest at 18% per annum "till realization" and does not restrict its computation to any earlier date. Furthermore, the decree’s language does not direct that the amount of Rs. 17,00,0
