Bombay High Court
Vinaeca Sinai Manerkar vs Bank Of India And Anr. on 27 January, 1995
Equivalent citations: 1996(5)BOMCR431
JUDGMENT E.S. Da Silva, J.
1. Rule, by consent, returnable forthwith.
2. This revision is directed against the order of the learned Civil Judge, Senior Division, Vasco da Gama, dated 2nd March, 1994, in Special Execution Application No. 20/92 whereby the learned Executing Judge has disposed of the objections filed by the petitioner/judgment-debtor No. 1 in the execution purporting the same to be an application filed under section 47 of the Civil Procedure Code. By the said order the learned Judge has held that irrespective of the fact that the decree might cover the payment of the principal amount together with interest with quarterly rests the same is not a nullity in spite of the fact that the interest due on such principal amount was not mentioned separately from the principal amount itself in terms of section 34 of the Civil Procedure Code and therefore the submission of the petitioner that the same was not enforceable in law in view of the Full Bench judgment of this Court in the case of Union Bank of India v. Dalpat Gaurishankar Upadyay, , was to be rejected. The said order has also disallowed the second contention of the petitioner that the decree was not to be executed against the petitioner who was only a guarantor unless and until all the remedies against the principal borrower were exhausted.
3. I have heard learned Counsel and in my view the impugned judgment of the Executing Court has made correct application of the law and cannot therefore be faulted with either on the ground of its perversity or improper or irregular exercise of jurisdiction. The grievance of the petitioner is that the decree passed by the trial Court and sought to be executed has been made in clear violation of section 34 of the Civil Procedure Code which provides that where and in so far as a decree is for the payment of money, the Court may, in the decree, order interest at such rate as the Court deems reasonable to be paid on the principal sum adjudged, from the date of the suit to the date of the decree, in addition to any interest adjudged on such principal sum for any period prior to the institution of the suit, with further interest at such rate.....as the Court deems reasonable on such principal sum, from the date of the decree to the date of payment, or to such earlier date as the Court thinks fit.
4. In this regard the Full Bench decision of this Court in Union Bank of India's case (supra) has ruled that interest, whether simple or compound, will remain interest for the purposes of section 34 and shall never merge in the principal. Thus, when the Legislature used the expression "in addition to pay interest adjudged on such principal for any period prior to the institution of the suit" in section 34 in contradistinction to the expression "principal sum", it has not made any distinction between the interest computed by way of simple interest or compound interest and hence the principal sum adjudged in section 34 means the original amount lent without the addition thereto of any interest whatsoever.
5. It is a fact that the executing decree seems to have been drawn without having regard to the aforesaid provision of section 34 as interpreted by the Full Bench judgment and thus the interest granted by the trial Court purports to cover the aggregate principal sum with the interest accrued. The contention of Mr. Bhobe, learned Counsel for the petitioner, is that such decree is a nullity because the same was passed in open breach of the legal provision of section 34 of the Civil Procedure Code and therefore there was no question of the same being executed or enforced by the respondents.
6. I am however unable to accept the submission of the learned Counsel. In the case of The Industrial Credit and Investment Corporation of India Ltd. & another v. Sharad Khanna & others, , a Single Judge of this Court has ruled that if a Court, while exercising jurisdiction under section 34 awards interest on the aggregate of the principal sum plus interest, it would not be an exercise lacking inherent jurisdiction but merely of an erroneous exercise within its jurisdiction. A Court, which otherwise has jurisdiction to entertain a dispute, equally has jurisdiction to decide it erroneously. The remedy in such a situation is by way of appeal, if one is provided, or other constitutional one. If there is no resort to them, the resort to them draws a blank, the order of the Court becomes final and it is not capable of being ignored on the ground of its being non est or a nullity. The Court in such a situation cannot and does not become coram non judice. It was further held that a situation where a statute mandates the Court the plenary jurisdiction to do or not to do something and the Court breaches the mandate cannot be equated with a situation where the Court inherently lacks jurisdiction to adjudicate upon the subject-matter of the dispute or with the case of a special forum of limited jurisdiction acting out of bounds of its jurisdictional limits. The former results in an erroneous decree, the latter in a decree which is a nullity.
7. In the instant case there is no dispute that the Court which passed the decree which is sought to be executed is a Court of competent jurisdiction to adjudicate the claim of the respondents. The fact of the Court having erroneously exercised its jurisdiction does not mean that the order passed by the Court is vitiated by lack of inherent jurisdiction. It is seen that the said order was challenged by the petitioner in appeal without any success and being so it is obvious that the order has become final since the petitioner had exhausted the only remedy available to him under the law. This being the position, it is obvious that the ground of nullity for the lack of inherent jurisdiction of the Court to pass such an order does not appear to be available for the petitioner.
8. This my view, which is otherwise based on the aforesaid judgment in the Industrial Credit and Investment Corporation of India case mentioned above, finds support in another judgment of this Court in the case of Egandol Taluka Gramodyog Utpadak Sahakari Society v. M/s. Sunil Waste Corporation, , which has in its turn followed an earlier judgment of the Supreme Court in Hiralal v. Kali Nath, . The aforesaid judgment has laid down the test to be adopted for deciding if the decree was capable of being objected to in a collateral proceedings as a nullity and it was held that it is always necessary to make a distinction between the pleas that tend to show that the decree in question is a nullity and pleas that merely challenge the validity or the propriety of the decree on the ground that it is contrary to the provisions of law. If the plea is that the decree is contrary to law in the sense that in passing the said decree certain provisions of the law have been ignored or contravened, that would not necessarily make the decree a nullity and allegations about the impropriety or the illegality of the decree cannot be entertained in execution proceedings.
9. In the result, I see no merit in this revision which therefore fails and is bound to be dismissed. Rule accordingly discharged with however no order as to costs.