Madras High Court
P. Venkatavaradan vs Lakshmi Ammal And Ors. on 26 June, 1981
Equivalent citations: (1982)2MLJ24
JUDGMENT V. Balasubrahmanyan, J.
1. The respondents to this revision remain ex parte. No counsel is before me to represent their side of the case. More is the pity, because the question for decision raises a somewhat rare problem in execution. The Code does not offer ready answers to it. There it no direct precedent of this Court either.
2. I heard Mr. M. Srinivasan for the petitioner. His advocacy was fair to the other side. This was only to be expected. All the same, at the end of the day, I could not help feeling that listening to an advocate argue both sides of a question is not quite the same thing as hearing advocates on both sides argue that question from rival portions. In such cases, we are often left with a sense of unfinished finish' about the hearing, if I may borrow a phrase from Galsworthy. I must, however, take this revision as I find it, and deal with the point as best as I may.
3. Outwardly, the point looks simple. It has to do with a problem of set-off in execution. The set-off is as between parties figuring under the same decree. Order 21, rule 19, provides for certain cases of set-off. It Says that cross-decrees as between two parties are entitled to be set-off against each other.
4. Needless to say, the problem would arise only when the cross-decrees are decrees for money. What we have here is a final decree for partition of properties. But, the decree contains two provisions which may be regarded as cross-decrees for money. On the one side, there is a decree for costs in a certain sum. On the other side there is a decree for owelty in a certain sum. The matter under revision arises in execution of the decree for costs. And the question raised is whether the decree for costs can beset-off against the decree for owelty.
5. There cannot be a moment's hesitation to order set-off, if Order 21, Rule 19 can be applied. But, the terms of the decree in this case rule out such an application. For, this is not a simple case of cross-decrees as you would have, if there were, for instance, a single plaintiff and a single defendant, an d the decree directs payment from the one to the other and vice versa. Nor is it a case of a multiplicity of plaintiffs and a multiplicity of defendants, as between whom the cross-decrees in the suit are strictly mutual, in the sense that the very plaintiffs who have to pay a sum of money to the defendants, are the parties who are to receive money from the same defendants. The decrees in such cases present a two-way traffic, as it were in all respects, in both directions.
6. In the present case, however the complication arises out of the array of parties and the terms of the part it on decree. In the suit there was but one plaintiff. He is the petitioner in this revision. I will hereafter refer to him as such. On the other side, there were a number of defendants. But, only six of them are concerned in the present proceedings. All the six of them are respondents before me. I shall refer to them as respondents 1 to 6.
7. Under the terms of the decree in the suit, the petitioner has a decree for owelty. That decree is available to him against the first respondent alone. It is not directed against the rest of the respondents 2 to 6. The Court has also passed a decree for costs. That decree is against the petitioner. And he is liable to pay the costs so awarded to all the respondents 1 to 6, not to the first respondent alone.
8. It was in this situation that the respondents 1 to 6 applied for execution of their decree for costs. They asked for the arrest of the petitioner for nonpayment of the costs. The petitioner objected. He pleaded a right of set-off. If that right were available to him under the law, then no execution could be levied against him. That is because the decree for costs against the petitioner is for Rs. 3,588,17, whereas his decree for owelty is for Rs. 7,500.
9. The execution Court however, rejected the petitioner's claim for set-off. The Court was apparently impressed by the circumstance that the cross-decrees were not mutual in all respects. The Court accordingly rejected the claim for setoff and ordered the petitioner's arrest. Order 21, Rule 19, does a of cover a case of this kind. The rule speaks of 'two parties' being 'entitled to recover sums of money from each other'. This means that where the cross-claims are not mutual in every respect, set-off is not available. For the rule to apply, the cross-decrees must satisfy the test of 'each-other' ness.
10. Mr. Srinivasan, was, however, able to find an authority for the position that set-off can be granted in this case even if the Code does not specifically provide for such a thing. He cited a Full Bench decision of the Andhra Pradesh High Court reported in Seshiah v. Veerabadrayya (F.B.). The learned Judges in that case observed, generally, that the execution chapter in the Code is by no means exhaustive, and the Court can draw upon its inherent power to render relief in cases not strictly covered by the express provisions of the Code. More particularly they held that even where set-off is not strictly available under under Order 21, Rule 19, the Court may yet grant 'equitable' set-off in respect of cross-decrees. Mr. Srinivasan said this equitable principle can be applied in the present case.
11. I see the importance of this principle of equitable set-off, and even its applicability to the present case. The only snag is bow to work it out without detriment to the interests of all parties concerned. We may assume that the petitioner can set-off the decree for costs, and then execute his decree for owelty against the first respondent for the balance (Rs. 7,500 minus Rs. 3,588.17), which comes to Rs. 3,911.83. That way the petitioner will find himself in no worse position than he would be if he were to pay the entire costs to the respondents, and if the first respondent were to pay the entire owelty to the petitioner. There is n o doubt also that equitable set-off of the two cress-decrees may not also hurt the first respondent. Possibly, may even give him some temporary fluidity. For, under the set-off, the first respondent will not be asked to pay to the petitioner the owelty decree to the full, and in the same process he would also be securing Rs. 3,911.83 which will represent more than his share of the costs awarded. So far so good. But, what about the rest of the respondents 2 to 6? An equitable setoff of Rs. 7,500 as against Rs. 3,588.17 will not, by itself, give to the respondents 2 to 6 their shares of the decree for costs. What is to be done about it? There are two technical ways of looking at the rights of parties in this case in the event of a mutual set-off on the basis suggested ,by Mr. Sranivasan. The decree for costs may be treated as fully satisfied even in the case of respondents 2 to 6 even though the set-off has particular reference only to the first respondent. This is one position which may be taken on a pure technicality. But, this cannot be proper. To say that the decree for costs is fully satisfied as respects respondents 2 to 6 would be contrary to facts since they would not be getting their shares of costs in hand by a mere process of setoff of the two decrees in the suit. But, there is another, way of looking at the situation, and it is this: even after the set-off against the decree for owelty, the decree for costs may yet be treated as not satisfied in so far as respondents 2 to 6 are concerned. But this way of understanding the effect of the set-off would be hard on the petitioner since under the set-off, he would perforce have to give credit to the first respondent as respects the entire costs of all the respondents and not merely to the first respondent's share of such costs. Look at it either way - you arrive at a position which proves to be unsatisfactory either to the one or to the other party. What is the way out of this quandary? Should not the equitable set-off be equitable for all the parties concerned?
12. Mr. Srinivasan found a solution in Order 21, rule 15. That again, is a provision which may not help, if read literally. But learned Counsel suggested that equity can stretch a point in the right direction even in this provision. The rule1 says, in substance, that where there is a joint decree in favour of joint plaintiffs and one of them seeks to execute it and the others are not made parties to the execution proceedings, the Court has jurisdiction to pass appropriate orders to protect their interests as wel, Mr. Srinivasan hastened to point out that this Rule is meant to protect joint decree-holders who do not figure in the procedings for execution of the decree, and not joint decree-holders who are very much present before the Court as parties to the execution petitions. He pointed out, however, that the case where all the joint decree-holders are before the Court must, if any thing, be afortiorai. If the Court is empowered, and almost enjoined, under Order 21, Rule 15, to have concern for joint decree-holders who are absent from the scene, then equity must certainly operate, a fortiori, in favour of such joint decree-holders when they actually figure as parties before the Court.
13. Rule 15 of Order 21, speaks of need for 'protection' of the absentee parties - a word of wide import from the view point of the Court's discretion. Protection, within the contemplation of this rule, may be given to the rest of joint decree-holders in various ways. For instance, the execution petitioner may be prevented from drawing out the moneys n deposit in excess of his share, leaving the balance to be paid out to the other joint decree-holder Section Or he maybe permitted to release the fruits of his execution subjeet only to the right of contribution of the others.
14. Mr. Srinivasan suggested that in this case a provision for contribution maybe quite an appropriate instrument by which equity may be done to every one of the parties. He suggested a practical method of working out both aspects of equity, namely, set-off and contribution, at one stroke. He said that the Court will first order a set-off as between the two decrees, one for cost sand the other for owelty, and adjust Rs. 3,91183 against Rs. 7,500. The Court will, by the same order, direct the first respondent to comply with two directions, namely : (1) directing the first respondent to pay the petitioner Rs. 3,911-83, which he would be entitled to receive from his decree for owelty, after the set off; and (2) directing the first respondent to pay to each of the other respondents 2 to 6 one-sixth share in the costs awarded, namely one-sixth of Rs. 3,588.17. This mode of adjustment, learned Counsel suggested, would settle every body's account under the present decree.
15. The time for taking up Mr. Srinivasan's suggestions is not yet, and certainly is not in the present proceedings. They were apparently mooted just to show that not only was equitable set-off indicated in the present case, but such set-off can be work ed out to the satisfaction of all the parties concerned.
16. On the whole, I am satisfied that the petitioner is entitled to equitable set off on the principle of the Full Bench decision of the Andhra Pradesh High Court cited earlier. I am also satisfied that the set-off can be equitably worked out without detriment to any of the parties. Both these steps might be taken either within the framework of the execution proceedings or even outside the Court. Indeed, it is a surprise to me that] the simple arithmetic of set-off and contribution available under the law had not been followed by the parties in this case. The disappointment is al] the greater, because the parties are not strangers to each other, but sharers in a partition. Be that as it may, the claim for equitable set-off in this case provides an effective answer to the petitioner to resist the present execution petition filed against him by the respondents. The application of the equitable doctrine either set-off the decree for costs here and now; or it provides the petitioner at least with a justification for non-payment. Either way, the execution petition deserves to be dismissed. The order to the contrary passed by the Court below is accordingly set aside.
17. The civil revision petition thus stands allowed. There will, however, be no order as to costs.