Solana Ramachandra Rao & Ors. v. Maddi Kutumba Rao & Anr.
Mitter, J. This is an appeal by a certificate granted by the
High Court. of Andhra Pradesh against a judgment and order
of that court dated March 4, 1963. The appeal is by a re
ceiver appointed in a suit under the provisions of s. 92 of the
Code of Civil Procedure with the object of applying for setting
aside a sale of certain properties belonging to a choultry.
The facts shortly are as follows :-The second respondent
before this Court obtained a decree in 0. S. No. 116 of 1949
of Sub-Court, Vijayawada against Tammana Tatayya and
Narayana Murty Annapurna Satram and put some property to
execution sale. The properties of the Satram were sold in court
auction on July !', 1957 and the first respondent, Maddi Kutum
barao became the purchaser for Rs. 24,600. O.S. No. 60 of
1957 was instituted in the same court for the . removal of the
two trustees on the ground of mismanagement. The decree
holder was made a party to this suit filed under s. 92, Civil Pro
cedure Code and one of the reliefs prayed for in the suit was
that the sale above-mentioned be set aside and provision be
made for payment of the. decree amount in O.S. No. 116 of
1949 und.er the scheme to be settled by the court. To quote
from paragraph 11 of the plaint in that suit, the plaintiff asked
that
"all proceedings in execution of the decree obtain
ed by the 3rd defendant against the Satram be stayed
pendmg the framing of the scheme and that the sale
in favour of the 4th defendant held on 1-7-1957 by
the Sub-Court, Gudivada in E.P. No. 37 of 1956 in
O.S. 116/ 49 Sub-Court, Vijayawada, be set aside and
that adequate provision for the discharge of the same
be made."
The plaint bears the date 22nd July 1957. The decree-holder.
the third defendant, was a minor represented by his mother and
guardian, Lakshmikantamma. lt appears that on July 30, 1957
a memorandum was filed on his behalf in the court of the Sub
ordinate Judge. It was stated therein that
"As the plaintiff in 0. S. No. 60 of 1957 have
filed that suit for framing a scheme for the manage
ment of the choultry, etc. and have asked· in that suit
for a proper provision to be made for the amount
due to the third respondent in this petition, under the
decree in O.S. No. 116/1949, thi1 third respondent
agrees to the same.
Therefore, this 3rd respondent has no objecti?n,
for allowing the petition that has been filed for setting
ll
RAMACHANDRA v. KUTUMBA (Mitter, J.) 705-
aside the sale held on 1-7-1957 in this suit without
the necessity of depositing the sale warrant amount."
The receiver appointed in O.S. No. 60/ 1957 filed an application
under 0. XXI r. 89 in the court of the Subordinate Judge to
set aside the court sale. He deposited Rs. 1,230 representin'.!
5'/, of the purchase money for payment to the purchaser; Rs.
410-15-0 as poundage and Rs. 123 for interest. No deposit
w~, made for payment to the decree-holder and it was stated i1~
parugraph 6 of the petition that:
"The 3rd respondent represented by his mother is
impleaded as third respondent in the Scheme Suit
O.S. No. 60 of 1957, Sub-Court, Vijayawada, wherein
necessary provision for the discharge of the decree
debt due to him from the choultry is prayed for and
has to be made. At the request of the petitioner to
keep up the fair name and prestige of the founders of
the choultry, the 3rd respondent's mother as guardian
and executor agreed to the said course and is willing
for an adequate provision for the discharge of the de
cree debt being made in the said suit and has agreed
to postpon.~ realising the decree debt in O.S. 116 of
1949, Sub-Court, Vijayawada, till then in case the
existing trustees, respondents 1 and 2 do not choose
to discharge the same in the meanwhile. Under the
circumstances, the petitioner submits that the Hon'ble
Court may be pleased to dispense with the deposit of
the amount specified in the proclamation of sale for
payment to the decree-holder as required by cl. (b)
of r. 89 of 0. XXI C.P.C."
The prayer in the petition was that the sale of the properties iR
favour of the fourth respondent be set aside and that respondents
I and 2 d.o pay the expense~ to be incurred by the petitioner
Tbe Subordinate Judge allowed the application observing:
"Where there is an arrangement between the
dec~ce-holder and the judgment-debtor for the satis
faction of the decree and the decree-holder does not
want any dep.osit to be made into court, it is perfectly
open to the judgment-debtor to come forward· with a
petition under 0. xxr. r. 89 without depositing the
amount required to be deposited under cl. (b) ."
T~i' was up;et in appeul by the High Court. According 10 th~
_High Court, 0. XXf, r. 89 permits the decree-holder and the
Judgment,-debtor to mutually cancel the. decree debt and the
cancellat~on of the debt may be either by an adjustment on ti
C<?n>tructive payment or by waiver by the decree-holder. The
Hlgh Court however found itself unable to agree with· the con-
'706 SUPREME COURT REPORTS [1967] 3 S.C.R•
·clusion of the Subordinate Judge that on the facts of the case
the decree-holder could be said to have received the amount
shown in the proclamation of sale for the purpose of 0. XXI,
r. 89.
There can be no doubt that if at the time when an applica-
1ion under. 0. XXI, r. 89 is made by the judgment-debtor, the
decree has been satisfied or adjusted, . the deposit of any money
for payment to the decree-holder is not called for. It was
.argued on behalf of the appellants that a mere promise on the
part of the judgment-debtor to take steps to ensure payment of
the decretal debt if acceded to by the decree-holder would have
the same effect. Reliance was placed on a judgment of ·this
-Court in The Union of India v. Kishori/al Gupta and Bros.(').
There it was pointed out that
"One of the modes by which a contract can be dis
charged is by the same process which created it, i.e.
by mutual agreement; the parties to the original con
tract may enter in\o a new contract in substitution of
the old one."
Reference was also made t~ the rule as stated by Cheshire and
Fifpot in their Law of Contract, 3rd Edn. at p. 453: "if what
the creditor has accepted in satisfaction is merely his debtor's
promise to give consideration, and not the performance of that
promise, the original cause of action is discharged from the date
when the agreement is made." Relying on the above decision,
it was contended on behalf of the appellants that even an exe
-cutory agreement between the decree-holder and the judgment
debtor would have thd same effect as the adjustment of a decree.
It is necessary to bear in mind · that a decree for payment of
1noney is not a contract between the parties although it is possi
ble for the parties to agree upon a couri;e of payment or agree
to have the decree satisfied otherwise than by payment of money.
For the purpose of this appeal,· it is not necessary to go into
that question. Assuming that the proposition put forward on
behalf of the appellants is correct, it must be shown that there
was an agreement between the parties by which the decree-holder
.agreed to forego his rights under the decree. Paragraph 6 of the
petition under 0. XXI, r. 89 which has been quoted above shows
that the decree-holder had merely agreed to postpone realising the
·decretal amount in case respondents 1 and 2 did not choose to
-discharge the same. That petition shows clearly that it was
anticipated that the court would be in a position to make a pro
vision for the discharge of the decretal debt. The decree was
kept alive and not touched upon in any manne£ muc~ less e~-
1inguished. The decree-holder was prepared to stay his. hands m
(I) [1960) I S.C.R. 493, 502.
RAMACHANDRA v. KUTUMBA (Mitter, !.) 707
case satisfactory provision for payment of his dues was made in
the suit. There was no adjustment of the decree which could be
recorded under the provisions of 0. XXI, r. 2; neither had the
decree been satisfied. The High Court was therefore right in its
conclusion that the situation was not one which obviated the
necessity for the judgment-debtor making a deposit under the
provisions of 0. XXI, r. 89 (b). On behalf of .the appellants,
reference was also made to the fact that the auction purchaser had
been ~itted by the court to withdraw the sum of Rs. 24,60~
deposited in court. We were informed that such withdrawal had
been permitted but the auction purchaser had once more made the
necessary deposit under the orders of the court. This cannot
affect the position in law under O. XXI, r. 89.
In the result, the appeal fails and is dismissed with costs.
V.P.S. Appeal dismissed