Kerala High Court
Sooppy vs A.N. Gopinathan on 14 September, 2012
Bench: K.M.Joseph, A.M.Shaffique
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR.JUSTICE K.M.JOSEPH
&
THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE
FRIDAY, THE 14TH DAY OF SEPTEMBER 2012/23RD BHADRA 1934
RFA.No. 791 of 2011 ( )
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I.A.6086/2011 IN OS.304/2003 OF I ADDITIONAL SUB COURT, KOZHIKODE.
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APPELLANT:
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SOOPPY, AGED 50, S/O. MOOSAKUTTY,
CHEMBAKASSERY HOUSE, PUTHOORVATTOM,
BALUSSERY, KOZHIKODE DISTRICT.
BY SRI.R.D.SHENOY, SENIOR ADVOCATE.
ADVS. SRI.ANIL GEORGE,
SRI.K.S.SUMEESH,
SRI.JOBY JACOB PULICKEKUDY.
RESPONDENTS/DEFENDANT/PLAINTIFF:
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1. A.N. GOPINATHAN, AGED 63 YEARS,
S/O.LATE SEKHARAN, KEEZHARIYOOR AMSOM,
NAMBRATH DESOM, KOYILANDY TALUK,
KOZHIKODE DISTRICT-673 324.
2. K. RAJAGOPALAN NAIR, AGED42 YEARS,
KUTTIYIL VEEDU, VIYYUR AMSOM DESOM,
KOYILANDY TALUK, KOZHIKODE DISTRICT-680 010.
R1 BY ADVS. SRI.N.SUBRAMANIAM,
SRI.M.S.NARAYANAN.
THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD
ON 28-02-2012, ALONG WITH RFA NO.858 OF 2011, THE COURT
ON 14-09-2012 DELIVERED THE FOLLOWING:
rs.
K.M.JOSEPH & A.M.SHAFFIQUE, JJ.
* * * * * * * * * * * * *
R.F.A.No.791 & 858 of 2011
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Dated this the 14th day of September 2012
J U D G M E N T
SHAFFIQUE,J These appeals are filed with leave of this Court challenging an order passed by the Subordinate Judges Court, Kozhikode in I.A.No.6086/2011 in O.S.No.304/2003. The 1st respondent herein is the defendant/judgment debtor in the suit and the 2nd respondent is the plaintiff/decree holder.
2. The suit was filed for recovery of money and an ex parte decree was passed on 12/08/2004. E.P.No.80/2005 was filed by the decree holder and the defendant's property having an extent of 1.69 acres was attached and sold in the Court auction on 31/5/2006. Mr.Rajeev Kumar purchased the property for an amount of Rs.4,35,870/-. Auction purchaser took delivery of the property and has assigned the property to one Basheer. The appellants are persons who have purchased portions of the above property from the said Basheer.
3. I.A.No.6086 of 2011 was filed by the defendant under Section 151 of the Code of Civil Procedure contending that he R.F.A.Nos.791 & 858 of 2011 2 had deposited the full amount by virtue of an order passed by this Court in F.A.O.No.164/08 and thereafter the suit was decreed. Since the amount covered by the decree was paid in full satisfaction of the decree he sought for restoring the property to the defendant from the possession of Court Receiver. In fact, it is as per order in F.A.O.No.164/08, this Court had directed that the property to be handed over to the Receiver, who took possession on 25/08/2011. The trial court, by the impugned order, directed the Official Receiver to hand over possession of the property to the judgment debtor.
4. The main contention urged by the appellants is that they are the owners of the property being assignees from the auction purchaser and the order was obtained behind their back. It is contended that as per the order in F.A.O.No.164/2008, the defendant was permitted proceed with the trial after impleading the purchasers. And without impleading them in the matter the plaintiff and defendant colluded together and obtained a direction to hand over the property from the Official Receiver to the defendant. According to the appellants, the order is illegal and the court below ought not to have entertained such an R.F.A.Nos.791 & 858 of 2011 3 application.
5. The defendant is the contesting respondent who inter alia contended that the suit was originally filed before the Sub Court, Koyilandy as O.S.No.43/01 which was transferred to the Sub Court, Kozhikode and renumbered as O.S.No.304/03. Since there was no notice after transfer, an ex parte decree was passed on 12/08/2004. The decree holder filed E.P.No.80 of 2005 in which the defendant was declared ex parte on 15/3/2006. In execution of the decree the property of the defendant was put in auction and by court sale held on 31/5/2006, his property worth more than Rs.72,00,000/- was sold for an amount of Rs.4,35,870/- and purchased by one Mr.Rajeev Kumar. The defendant had come to know about the sale only on 25/7/2006 and he filed an application E.A.No.358/06 to set aside the ex parte order dated 15/3/2006 in the execution petition and another application was filed as E.A.No.359/06 to set aside the sale under Order 21 Rule 90 of the C.P.C. Those applications were dismissed as the amount was not deposited as per directions of the court.
R.F.A.Nos.791 & 858 of 2011 4
6. The defendant also filed I.A.No.10/2007 to set aside the ex parte decree and I.A.No.11/2007 to condone the delay in filing the said application. The said applications were allowed on 12/1/2007 but later reviewed and dismissed. Challenging the order in I.A. No. 10/2007 and 11/2007, the petitioner filed F.A.O.No.164/2008 before this court.
7. It is the contention of the learned counsel for defendant that when this Court allowed F.A.O.No.164/2008, the decree stands set aside and since this Court has directed the property to be handed over to a Receiver on certain conditions, he was justified in requesting for an order under Section 151 of the Code to hand over the property to the defendant and the said application was not one under section 144 of the C.P.C.
8. The Counsel for defendant therefore raised a preliminary objection regarding maintainability of the appeal and according to him, the impugned order is not appealable under Section 96 read with Order 41 Rule 1 of the Code as the order passed under Section 151 of the Code does not amount to a decree as provided under section 144 of the Code. R.F.A.Nos.791 & 858 of 2011 5
9. On the other hand, the learned Senior Counsel Sri.R.D.Shenoy appearing for the appellant contended that though the application filed by the defendant is under Section 151 of the Code, in effect it is an application under section 144 of the Code and therefore the order amounts to a decree which is appealable.
10. Therefore, the first question to be considered is regarding the maintainability of the appeal. The facts as already indicated above emanated from the judgment of this Court in F.A.O.No.164/2008. By the said order, this Court had set aside the ex parte decree and directed the parties to go for trial on certain conditions. But, instead of going for trial the matter was settled between the parties. The defendant had withdrawn his contentions and the decree was satisfied. The scope of the order passed in the F.A.O was to enable the defendant to go for trial and to permit the assignees of the property to participate in the trial, though not being necessary parties. The appellate court intended that the persons interested in the property were to be made parties when a decision is taken regarding the property sold in court auction as a consequence of setting aside ex parte R.F.A.Nos.791 & 858 of 2011 6 decree.
Section 144(1) of the Civil Procedure Code reads as follows:
144. Application for restitution.- (1) Where and in so far as a decree [or an order] is [varied or reversed in any appeal, revision or other proceeding or is set aside or modified in any suit instituted for the purpose, the Court which passed the decree or order] shall, on the application of any party entitled to any benefit by way of restitution or otherwise, cause such restitution to be made as will, so far as may be, place the parties in the position which they would have occupied but for such decree [or order] or [such part thereof as has been varied, reversed, set aside or modified]; and, for this purpose, the Court may make any orders, including orders for the refund of costs and for the payment of interest, damages, compensation and mesne profits, which are properly [consequential on such variation, reversal, setting aside or modification of the decree or order.] [Explanation.- For the purposes of sub-
section (1), the expression "Court which passed the decree or order" shall be deemed to include,- R.F.A.Nos.791 & 858 of 2011 7
(a) where the decree or order has been varied or reversed in exercise of appellate or revisional jurisdiction, the Court of first instance;
(b) .............;
(c) .......................
(2) No suit shall be instituted for the
purpose of obtaining any restitution or other relief which could be obtained by application under sub-section (1).
11. The above provision apparently applies when a decree or an order is varied or reversed in any appeal and the court which passed the decree shall, on the application of any party entitled to any benefit by way of restitution or otherwise, cause such restitution to be made as will so far as may be, place the parties in the position which they would have occupied but for such decree or order.
12. In the above case, the decree was passed pursuant to which the property of the defendant was sold and the amount recovered. Against an order refusing to set aside the ex parte decree, the defendant filed an appeal and the decree was set aside. When the F.A.O is allowed, apparently the right accrues R.F.A.Nos.791 & 858 of 2011 8 on the defendant to seek restitution of the decree and was entitled to apply to the court for reliefs pursuant to such modification made by the High Court. In fact, the High Court while disposing the F.A.O also directed the property which was the subject matter of sale to be put in possession of a Receiver since the auction purchaser took delivery of property when the ex parte decree was not in force. Such a direction was issued by this court to enable the parties to seek restitution after a decision has been taken by the trial Court after re-consideration of the matter on merits. There is also clear indication in the F.A.O order that the subsequent assignees are also required to be heard. Therefore, when the ex parte decree is set aside by the appellate order, a right accrued on the defendant to seek restitution of the decree. However, the defendant withdrew the contentions in the written statement and permitted the suit to be decreed, settled the decree amount and thereafter filed I.A.No.6086/2011 for a direction to the Receiver to hand over possession of the property to the defendant.
13. It is relevant to note that the sale in the above case had already been confirmed by the execution court, sale R.F.A.Nos.791 & 858 of 2011 9 certificate is issued, the property was taken possession by the auction purchaser and the property is also sold by the auction purchaser to persons who were not party to the proceedings.
14. It seems that the defendant's request before the trial court was only to put him in possession of the property which was taken by the auction purchaser wrongfully, that is when the ex parte decree was not in force. Such a request is made apparently as a consequence of this court's finding in F.A.O.No.164/2008 that the delivery of property to the auction purchaser was wrongful.
15. Let us now analyse the case law with reference to section 144 of CPC. Prior to 1976 amendment this court held in Krishna Kurup v. Padmanabha Pillai (1953 KLT SN 23 (C.No.64) that "It is settled law that the provisions of S. 144 are not exhaustive. The jurisdiction to make restitution is inherent in every court and will be exercised whenever justice demands it."
16. In Subramonia Iyer vs Damodara Potti (1963 KLT 531) this court held as follows:
R.F.A.Nos.791 & 858 of 2011 10
"The decision of the High Courts in India are not uniform on the question whether an appeal would lie from an order passed under S. 151 for restitution, when the facts would not attract the application of S. 144 of the CPC. After considering various authorities it is futher held that: " As the question in this case concerns a matter arising after the delivery of the property in execution of the decree, I do not think that it relates to execution, discharge or satisfaction of the decree so as to fall within the ambit of S. 47 of CPC. Hence the question of the appealability has to be decided on the basis that the application was one under S.151 alone."
17. While considering the principle of restitution with reference to section 144 of CPC, a full bench of this court held in Themmalapuram Bus Transport, Palghat v. Regional Transport Authority, Palghat & Others (1967 KLT 122 (F.B.) that:
"The rule is well known that the acts of courts should not be allowed to work injury on the suitors. Their Lordships of the Supreme Court observed in Jang Singh v. Brij Lal AIR. 1966 SC. 1631 at 1633: "There is no higher R.F.A.Nos.791 & 858 of 2011 11 principle for the guidance of the Court than the one that no act of Courts should harm a litigant and it is the bounden duty of Courts to see that if a person is harmed by a mistake of the Court he should be restored to the position he would have occupied but for that mistake. This is aptly summed up in the maxim: `Actus curiae neminem gravabit."...................Lord Carson said in Jai Berham v. Koder Nath AIR. 1922 P. C. 269 at 271: "Nor indeed does this duty or jurisdiction arise merely under the said section (S. 144 CPC). It is inherent in the general jurisdiction of the Court to act rightly and fairly according to the circumstances towards all parties involved."
18. Taking note of the 1976 amendment to section 144 of CPC this court in Madhavan v. Basheer Ahamad (1989 (2) KLT 240) held as follows:
"It should in this connection be remembered that in order to apply the section the following three conditions are required to be satisfied: (a) the restitution sought for must be in respect of the decree or order which had been varied or reversed. (b) the applicant for R.F.A.Nos.791 & 858 of 2011 12 restitution must be qualified for the benefit under the decree or order reversed. (c) the relief claimed must properly be consequential on the reversal of or variation of the decree or order."
It is further held that:
"It is a well established principle in law that the relief claimed in a petition under S.144 is consequential on the reversal or variation of the decree/order in execution whereof property was delivered. A reference in this connection to the words introduced into the Section by the Amendment Acts of 1956 and 1976 is profitable. Prior to the amendment of this section in 1956, this section was applicable only where a decree was varied or reversed. The words `or an order' have been inserted after the word `decree' by the Code of Civil Procedure (Amendment) Act, Act 66/ 1956. The effect of this amendment is that the section would thereafter apply even to a case where an order has been varied or reversed. The words "varied or reversed in any appeal, revision or other proceeding or set aside or modified in any suit instituted for the purpose, the court which passed the decree or R.F.A.Nos.791 & 858 of 2011 13 order" introduced in the section in the place of `varied or reversed, the court of first instance etc., by Act 104 of 1976 make it clear that after this amendment the section does not contain such restriction as to the manner in which a decree or order should be varied or reversed. The only condition that can be imposed in this regard must be that the variation or reversal shall be in accordance with law. The words `or an order' takes colour from the word `decree' in the Section and therefore `the order' which is varied or reversed, within the meaning of this section must be an executable order, like a decree and therefore on the variation or reversal of such a decree or order, the application for restitution is maintainable".
19. In Karunakaran Nair v. Mehta (P) Ltd.(1998 (2) KLT 260) this court while considering whether a person is entitled to file an application under section 144 of CPC on the reversal of the decree when the benefits were taken away not through the process of execution of the court held as follows:
"On a conspectus of the above decisions, it is seen that if a person is dispossessed under the colour of the decree and that decree is R.F.A.Nos.791 & 858 of 2011 14 subsequently reversed, then he is entitled to restitution. In the Madras and Karnataka Cases the dispossession was not on account of the decree; either it was in excess of the order contemplated or was not in accordance with the order. Hence, those decisions are distinguished. In the above view of the matter, I am of the view that the order of the court below is correct."
20. In South Eastern Coalfields Ltd. v. State of M.P., (2003) 8 SCC 648, it is held as follows:
"The principle of restitution has been statutorily recognized in Section 144 of the Code of Civil Procedure, 1908. Section 144 CPC speaks not only of a decree being varied, reversed, set aside or modified but also includes an order on a par with a decree. The scope of the provision is wide enough so as to include therein almost all the kinds of variation, reversal, setting aside or modification of a decree or order. The interim order passed by the court merges into a final decision. The validity of an interim order, passed in favour of a party, stands reversed in the event of a final decision going against the party successful at the interim stage. .............................."The successful party R.F.A.Nos.791 & 858 of 2011 15 can demand (a) the delivery of benefit earned by the opposite party under the interim order of the court, or (b) to make restitution for what it has lost; and it is the duty of the court to do so unless it feels that in the facts and on the circumstances of the case, the restitution far from meeting the ends of justice, would rather defeat the same". ....................."In the exercise of such inherent power the courts have applied the principles of restitution to myriad situations not strictly falling within the terms of Section 144".
21. On an analysis of the above judgments it becomes all the more clear that the scope of section 144 is wide enough to include therein almost all the kinds of variation, reversal, setting aside or modification of a decree or order. If the facts disclosed in the application filed under section 151 of CPC as in the present case attracts the application of S. 144 of the CPC defenitely the order passed amounts to a decree which is appealable and as held by the judgment cited above after the 1976 amendment the area of application of seectiion 144 of CPC had been substantially increased and only in circumstances which is not covered by the section 144 of CPC that section 151 R.F.A.Nos.791 & 858 of 2011 16 of CPC can be resorted to.
22. Applying the above principle of law, it is clear that the application now filed under Section 151 of the C.P.C. would clearly amount to an application seeking possession of the property which was handed over to the Receiver as per order in FAO 164/2008. When an order of delivery of property is interfered in a collateral proceeding by the High Court it gives a right to the defendant to get back possession of his property or put him in the same position as he was before delivery of the property.
23. The counsel for defendant however relied upon the judgment in Garuda Singh Majhi vs Dhana Bai and others (AIR 1989 Orissa 103) to contend that when an ex parte decree is set aside Section 144 has no application and the court could put the parties in the same position by invoking section 151 of the code. We do not think that the said judgment lays down the correct position of law and there is no reason to give a limited meaning to the word "set aside" as appearing in section
144. Apart from that when third party rights were created based on the ex parte decree and consequent sale of property in R.F.A.Nos.791 & 858 of 2011 17 execution of the decree definitely the defendant should avail of the specific provision of section 144 available under the code.
24. Since it is found that in the present petition under section 151 of the Code, the defendant was seeking restoration of possession as per the Judgment in F.A.O.164/2008, it amounts to restitution of an order as provided under section 144 of the Code and hence a decree. Hence the appeals are maintainable.
25. Then the other question is whether the petitioners are required to be heard before passing the impugned order. On a perusal of the judgment in F.A.O itself would indicate that this Court intended two things. One is that the parties to the suit intended to proceed for trial and the second is that during trial the auction purchaser or subsequent assignees are also to be heard. Apart from that when the Receiver appointed by court has taken possession of the property the auction purchaser who took possession of the property from court ought to have been heard.
26. The parties did not choose to go for trial, whereas the defendant had withdrawn the contentions and the suit was decreed. It seems that the decree was satisfied on payment of the amount covered by the decree. The benefit that accrued to R.F.A.Nos.791 & 858 of 2011 18 the plaintiff on execution of the ex parte decree was the amount recovered by sale of property. So only when the sale is set aside and the auction purchaser is given the refund of the amount, restitution of the benefit of the decree would take place. Instead of proceeding in that direction, the defendant had only chosen to get a direction from the Court to hand over possession of the property to the defendant, even without setting aside the sale or cancelling the sale certificate and ignoring the rights of such auction purchaser and other assignees. How ever it will be open for the defendant to take any such steps as presently we are only concerned with the impugned order.
27. Since the receiver had taken possession of the property pursuant to orders passed by this court, necessarily the auction purchaser and the present title holders are also to be heard while dispossessing them from the property.
28. Hence, we are of the view that the impugned order is liable to be set aside, and the matter remitted to the trial court for fresh disposal. The defendant shall implead the auction purchaser and subsequent assignees as parties to the application, and court below shall dispose of the matter as R.F.A.Nos.791 & 858 of 2011 19 expeditiously as possible. The right of the defendant to seek further orders for setting aside the sale or for cancellation of the sale certificate is reserved.
(sd/-) (K.M.JOSEPH, JUDGE) (sd/-) (A.M.SHAFFIQUE, JUDGE) jsr R.F.A.Nos.791 & 858 of 2011 20 R.F.A.Nos.791 & 858 of 2011 21