Punjab-Haryana High Court
Vishwanath And Ors vs Land Acquisition Collector And Anr on 7 October, 2014
Author: Rakesh Kumar Jain
Bench: Rakesh Kumar Jain
VINOD KUMAR
2014.10.16 12:42
I attest to the accuracy and
authenticity of this document
Chandigarh
CR No.1970 of 2013 (O&M) [1]
*****
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
CR No.1970 of 2013 (O&M)
Date of decision:07.10.2014
Vishwanath and others ...Petitioners
Versus
Land Acquisition Collector, Phagwara and another ...Respondents
CORAM: Hon'ble Mr. Justice Rakesh Kumar Jain
Present: Mr. Hitesh Kaplish, Advocate,
for the petitioners.
Mr. Rajinder Sharma, Advocate,
for the respondents.
*****
RAKESH KUMAR JAIN, J. (Oral)
The issue involved in this case is as to whether an order for rateable distribution of the assets of the decree-holder could be passed by the Executing Court without there being any application filed by the other decree-holders especially before the receipt of such assets by the Court?
The brief facts of the case are that the petitioners have an award dated 16.03.2009 in their favour passed by the Tribunal Town Improvement Trust/District Judge, Kapurthala on account of acquisition of their land. The said Court had decided various land references by a common order but the petitioners had filed their execution separately in which the judgment-debtor/Improvement Trust filed their objections which VINOD KUMAR 2014.10.16 12:42 I attest to the accuracy and authenticity of this document Chandigarh CR No.1970 of 2013 (O&M) [2] ***** were dismissed on 17.12.2011 and the account of the judgment-debtor with the Bank of Baroda was attached. While the petitioners were pursuing their execution, an order was passed by the Executing Court on 14.03.2012, which reads thus:-
"At this stage, ld. Counsel for the Improvement Trust submitted that there are two other cases titled as "Urmila Rani Vs. Land Acquisition" and "Dhani Ram Vs. Improvement Trust". So the question involved in this case is that as to whether there should be rateable distribution or not. So, in view of the request having been made by DH, case is adjourned to 15.03.2012 for consideration regarding the rateable distribution."
Counsel for the petitioners has submitted that the Executing Court has wrongly recorded in the zimni order dated 14.03.2012 that the request was made by the decree-holder for rateable distribution, rather the request was made by the judgment-debtor.
Be that as it may, vide the impugned order dated 18.04.2012, the Executing Court had distributed the amount of `2,70,77,306/- amongst the petitioners to the tune of 35.55%, Urmila Rani and others to the tune of 57.63% and Dhani Ram and others to the tune of 6.80% as per the rateable distribution of the total amount. In this manner, the amount of the Improvement Trust attached to the tune of `1,22,36,768/- was ordered to be paid to the petitioner to the extent of 35.55%, which comes to `43,51,044/- as against their claim of `96,26,805/-, though according to the petitioner it VINOD KUMAR 2014.10.16 12:42 I attest to the accuracy and authenticity of this document Chandigarh CR No.1970 of 2013 (O&M) [3] ***** is much more than that.
Counsel for the petitioners has submitted that the Executing Court has erred while interpreting Section 73 of the Code of Civil Procedure, 1908 (here-in-after referred to as the "CPC") as there was no application on behalf of the other land owners, i.e. Urmila Rani and others and Dhani Ram and others, for the purpose of rateable distribution. The relevant portion of the impugned order, which has been attacked by the counsel for the petitioners in this case, reads thus:-
"I have also heard on the rateable distribution. In the present Execution titled as Vishwanath and others Versus Land Acquisition Collector and another, the calculation of compensation alongwith interest as per the revised rates was presented on behalf of the Improvement Trust, Phagwara. As per the revised calculation the amount of Rs.96,26,805/- is liable to be paid by the Improvement Trust in accordance with the award for which the execution has been filed by Vishwanath and others as mentioned in the execution application. In the other executions titled as Urmila Rani Versus Land Acquisition Collector, the amount of Rs.1,56,07,248/- has been calculated by the Executive Officer, Improvement Trust, Phagwara, which are liable to be paid by him in pursuance of the award passed in favour of Urmila Rani and others. In the third execution VINOD KUMAR 2014.10.16 12:42 I attest to the accuracy and authenticity of this document Chandigarh CR No.1970 of 2013 (O&M) [4] ***** application titled as Dhani Ram Versus Improvement Trust, Phagwara, the amount to the tune of Rs.18,43,282.71 has been calculated by the Chairman, Improvement Trust, Phagwara, which are liable to be paid by the said Improvement Trust to said Dhanni Ram through his LRs and others. Section 73 of the Code of Civil Procedure provides for rateable distribution and it provides that where the assets of Judgment Debtor are held by the Court and before the receipt of said assets, DH have applied to the court for execution of a decree for payment of money against the same judgment debtor and have not obtained satisfaction, the assets shall be rateably distributed amongst them. In the three execution applications as mentioned above the awardees are seeking the disbursement of the amount which the JDs such as authorities of Improvement Trust, Phagwara, are liable to pay on account of the said awards having been passed in favour of the respective awardees. So as per the calculations made on behalf of the Improvement Trust the total claim in the above three executioin applications come to the tune of Rs.2,70,77,306/- and as per the rateable distribution Vishwanath and others become entitled to recover 35.55% and Urmila Rani and others are entitled to 57.63% and Dhanni Ram and others VINOD KUMAR 2014.10.16 12:42 I attest to the accuracy and authenticity of this document Chandigarh CR No.1970 of 2013 (O&M) [5] ***** are entitled to 6.80% out of the abovesaid amount of total claim. In this way, the Improvement Trust, Phagwara's attached amount is Rs.1,22,36,768/- and its 35.55% comes to the tune of Rs.43,51,044/- to which the Vishwanath and others are entitled to recover as per the rateable distribution. So in accordance with the rateable distribution, the amount of Rs.43,51,044/- be released in favour of Vishwanath and others and for the consideration on disbursement of the remaining amount in the executions Dhani Ram Versus Improvement Trust and Urmila Rani Versus Land Acquisition Collector, the files be put up on 28.04.2012 along with the present file."
Counsel for the petitioners has argued that the language of Section 73 of the CPC itself suggests that where the assets are held by Court and more persons than one have, before the receipt of such assets, made application to the Court for the execution of decree for the payment of money passed against the same judgment-debtor, the assets, after deducting the costs of realization, shall be rateably distributed among all such persons. Since there was no application filed either by Urmila Rani and others or Dhani Ram and others before the receipt of the assets by the Court by attachment of the amount of the judgment-debtor lying with the Bank of Baroda, therefore, the impugned order distributing the amount of compensation rateably amongst the three claimants is patently illegal. In VINOD KUMAR 2014.10.16 12:42 I attest to the accuracy and authenticity of this document Chandigarh CR No.1970 of 2013 (O&M) [6] ***** this regard, he has relied upon a Division Bench judgment of the Kerala High Court in the case of Boban v. Sajith Kumar and another, 2004 AIR (Kerala) 181.
Counsel for the respondents, however, has submitted that even if the application is not filed by the other land owners, as suggested by counsel for the petitioners, once the execution application is filed, it has to be treated as an application and thus there is no error committed by the Executing Court in passing the impugned order. He also informs the Court that Dhani Ram, one of the claimants, has already taken the compensation.
I have heard learned counsel for the parties and examined the available record with their able assistance.
Before I advert to the facts of this case, it would be relevant to refer to the provisions of Section 73 of the CPC, which reads thus:-
73. Proceeds of execution-sale to be reateably distributed among decree-holders-- (1) Where assets are held by a Court and more persons than one have, before the receipt of such assets, made application to the Court for the execution of decrees for the payment of money passed against the same judgment-debtor and have not obtained satisfaction thereof, the assets, after deducting the costs of realization, shall be reteably distributed among all such persons :
Provided as follows :--
(a) where any property is sold subject to a mortgage VINOD KUMAR 2014.10.16 12:42 I attest to the accuracy and authenticity of this document Chandigarh CR No.1970 of 2013 (O&M) [7] ***** or charge, the mortgage or incumbrancer shall not be entitled to share in any surplus arising from such sale;
(b) where any property liable to be sold in execution of a decree is subject to a mortgage or charges the Court may, with the consent of the mortgagee or incumbrancer, order that the property be sold free from the mortgage or charge, giving to the mortgagee or incumbrancer the same interest in the proceeds of the sale as he had in the property sold;
(c) where any immovable property is sold in execution of a decree ordering its sale for the discharge of an incumbrance thereon, the proceeds of sale shall be applied--
first, in defraying the expenses of the sale;
secondly, in discharging the amount due under the decree; thirdly, in discharging the interest and principal moneys due on subsequent incumbrances (if any); and fourthly, rateably among the holders of decrees for the payment of money against the judgment debtor, who have, prior to the sale of the property, applied to the Court VINOD KUMAR 2014.10.16 12:42 I attest to the accuracy and authenticity of this document Chandigarh CR No.1970 of 2013 (O&M) [8] ***** which passed the decree ordering such sale for execution of such decrees, and have not obtained satisfaction thereof.
(2) Where all or any of the assets liable to be rateably distributed under this section are paid to a person not entitled to receive the same, any person so entitled may sue such person to compel him to refund the assets. (3) Nothing in this section affects any right of the Government."
As per the facts narrated before me, the account of the judgment-debtor with the Bank of Baroda was attached in the execution filed by the petitioners, therefore, it could be easily held that the application filed by the petitioners was before the receipt of such assets/money of the judgment-debtor, lying in its account with the Bank of Baroda. Besides the fact that there is no such application filed by the other decree-holders who had also awards in their favour passed by the Tribunal, the Executing Court, on the asking of the judgment-debtor, has passed the impugned order saying that as per Section 73 of the CPC, the rateable distribution has to be provided of the assets of the judgment-debtor, which is held by the Court, amongst all the decree-holders who are asking for the money which has been attached but in Boban's case (supra), the Division Bench of the Kerala High Court has made the following observations:-
"6. We need not elaborately deal with those decisions cited by the counsel on either side, since we are satisfied VINOD KUMAR 2014.10.16 12:42 I attest to the accuracy and authenticity of this document Chandigarh CR No.1970 of 2013 (O&M) [9] ***** that the sale is not vitiated by fraud or material irregularity. With regard to the claim for rateable distribution, we are of the view that the appellant has not satisfied the conditions to be complied with for claiming rateable distribution. The object of Section 73 is to prevent unnecessary multiplicity of execution proceedings, to obviate, in a case where there are many decree holders, each competent to execute his decree by attachment and sale of a particular property, the necessity of each and every one separately attaching and separately selling that property. In order to enable the decree holder to participate in the assets of a judgment debtor the following conditions have to be satisfied by the decree- holder; (i) decree holder claiming to share in the rateable distribution should have applied for execution of his decree to the appropriate Court, (ii) such application should have been made prior to the receipt of the assets by the Court, (iii) the assets of which a rateable distribution is claimed must be assets held by the Court,
(iv) the attaching creditor as well as the decree holder claiming to participate in the assets should be holders of decrees for the payment of money, and (v) such decrees should have been obtained against the same judgment debtor. It is well settled that no rateable distribution VINOD KUMAR 2014.10.16 12:42 I attest to the accuracy and authenticity of this document Chandigarh CR No.1970 of 2013 (O&M) [ 10 ] ***** should be claimed unless all the above mentioned conditions are fulfilled. Appellant herein has not satisfied any of the conditions enumerated above. Facts would show that appellant has not filed any application for rateable distribution prior to the receipts of assets by the Court. In V.T. Veerappa Chettiar's case, AIR 1973 Madras 313 (supra) the Court has held that an application for execution of a decree should be taken in the Court which received and held the assets. It was also held that Section 73 cannot be construed so as to enable all the decree holders, irrespective of their applications in different Courts, to claim the benefit since the Court which has received and held the assets may not know the number of applications in various Courts. In K. Subbayyamma's case, AIR 1961 AP 422 (supra), the Court has taken the view that one of the conditions which has to be satisfied before a decree holder can claim rateable distribution under the Section is that he should have applied for execution of his decree to the Court before the receipt of the assets. In the instant case, since the appellant has not satisfied any of the above mentioned conditions, we are of the view that Court below is perfectly justified in dismissing the application.
The appeal is accordingly dismissed."
VINOD KUMAR2014.10.16 12:42 I attest to the accuracy and authenticity of this document Chandigarh
CR No.1970 of 2013 (O&M) [ 11 ]
*****
Even from a plain reading of the provisions of Section 73 of the CPC, it is very much clear that the application has to be filed with the Executing Court before receipt of such assets if there are more than one persons who are holding the decree in their favour and then after deducing the costs of realization, the rateable distribution has to be made. However, in the present case, no application has been filed and any execution application filed by Urmila Rani and others and Dhani Ram and others cannot be treated to be an application in terms of Section 73 of the CPC as the application for execution has to be filed under Order 21 of the CPC.
Thus, the question posed in the beginning of the judgment is answered in affirmative holding that filing of an application in terms of Section 73 of the CPC is a sina qua non for the purpose of rateable distribution amongst various decree-holders who have a common ground for recovery of the amount which is attached in terms of the decree.
Accordingly, the present revision petition is allowed and the impugned order is set aside.
October 07, 2014 (RAKESH KUMAR JAIN) vinod* JUDGE