.(94

PREMRAJ

RAM CHARAN

Match 4, 1974

[P. JAGANMOHAN REDDY, S. N. DWIVEDI AND P. K. GoSWAMI, JJ.)

Limitation Act 1908---S. 182-Whethcr the fifth applicatioll for execution was a "step in aid of execution" and if so, whether ir is barred by limitation.

K. and his wife purchased the house in dispute. K died in 1936 leaving behind him S and R, his son. In 1951, R mortgaged the house to the appellant.

The. appellant obtained a preliminary decree for foreclosure and also the final decree In the meantime, S. gifted the entire house to Prakash Chandra son of R. He thereafter, frustrated several attempts of the appellant to execute the decree and in 1956, instituted a suit against the appellant and another for a declaration that the preliminary and final decree of foreclosure were not binding on him and prayed for a perpetual injunction against the appellant. The suit was dismissed but he appealed. The appeal court partly allowed his appeal holding that he

~·s te oner. of half share in the house by virtue of the gift and issued an I OJ unction m hts favour. The appellant filed a second appeal in the High Court and Prakash Chandra also filed a cross-objection in respect of his half share.

Both the appeal and the cross-objection were dismissed by the High Court

The fourth execution application filed by the appellant was dismissed on June 23, 1956. The fifth execution application was filed by the appellant on July 28, 1964 for possession of half of the house. The respondent objected to this application on the ground of limitation. The objection was disallowed by the execution court and by the appeal court. It was, however, upheld by the High Court and the appli cation was dismissed as time-barred. Hence this appeal. 3 points were raised by the appellant before this Court-(1) Limitation is saved by cis. 1, 2 & 4 of Art. 182

(ii) Limitation is saved by cl. 5 of Art. 182 and (iii) the fifth application for execution was really an application to revive the fourth execution proceeding and therefore, it was not time-barred. Dismissing the appeal,

HELD : (i) It is plain that neither the decree of the appeal court nor the decree of the High Court reversed, varied or amended in any manner the final foreclosure decree of the appellant. The foreclosure decree remained intact and fully alive.

It could be executed against the respondent according to its tenor. He could be ejected from the whole house. But it could never have any effect against Prakash Chandra's (the respondent's son) paramount title to a half har~ in the house.

Prakash Chandra's appeal and the High Court decree I?assed m h1s apenl ould not fall within cls. 2 & 4 of Art.182 and would not fllrmsh a fresh start.mg pomt of limitation for executing 'the foreclosure decree against the respondent-judgment debtor.

Bhawanipur Banking Corporation Ltd. v. Guri Sf1ankr1 Sanna (1950] SCR 25 referred to. [498 A-B, q

(ii) In order to get the advantage ofCl. 5 of Art. 182, the appellnt has to satisfy 3 conditions:-

(a) the written statement filed in respondent-son's suit and in his appeal were an "application"

(b) the Court where respondent-son's case and appeal, and wherein the appellant's second appeal was filed were the proper court, and

(c) Proceedings specified in (a} are a step in aid of execution of the decree sought to be executed by the appellant. {498 DF]

(iii) To oppose Prakash Chandra's suit, the appellant had filed a written statemen!.

Tbe written statement ordinarily does not include any request to the court and 1t is not an 'application' within the meaning of Cl. 5 of Art. 182. [499 CD]

PREM RAJ v. RAM CH.UAN (Dwivedi, ],) (95

(PflllltQ LDI v. Snrt. SarasWQti Dei AIR 1960 All S72 and Karlar Sii. v, SMllaff

Singii'Parap Sitith A.J.R. 1967 Punjab:m, distinguished.) ·

(iV) Further, even if the suit and appeal was instituted in the proPer court, the written statement filed by the appeUant was not an application and thw:fore, he caDDot take advantage of 0. !! of Art. 182. -As the appellant's appeal n the Hiah Court was not an application to the 'Proper Court', it is unnecessary to deCide whether . in 1he suit and in the appeal filed by Prakash Chandra the written statement of the appellant and his resistance to ibe appeal and his second appeal in tho High Court amounted to a step-in-aid in execution of the decree sought to be executed by him.

[500 A-D, SOJH-S04 AJ .

(v) The fifth application for execution was not a continuation of tho previous application because the previous application was dismissed for not payilir tho process fee etc. and it was not a pending application. [504 D-E]

DIJselftinz Ptr Goswami J.-The appellant was faced with resistance from the respondent and his relations. The appellant made abortive attempts to . execute the mortgage decree in order to obtain posseSsion of the suit property. Having failed to obtain possession by usual civil process the appellant applied for poli~ belp which was rejected. Further, the respondents' soil dragged the appellant to a suit which became another obstacle to the execution of the dc!t:rec for possession

of the suit property. Further, the partly accepted appeal of the judgment debtor's son by the appellate Court changed the character of the original foreclosure decree which the appellant could execute. Further, because of injunctioru restraining the appellant from executing the foreclosure decree in full the original foreclosure

decree, in the form it was, was not capable of execution. [S17 C-B, 518 B]

MaMraja Sir Rmneshwor Silf6h lklhadllr v. Homeshwar Singh (1921) 40 Madrrn L8w JourfiDI l/6, referred to.

Tberefore, the decree the Civil suit No. 75A of 1957 had a direct and immediate connection with and effect upon the decree in suit No. 27A of 1952 sought to be executed. The nexus between the two is manifestly clear, It was obvious that the appellants' successive ecphractic actions in defending the foreclosure decree in different ways until its final determination in the High Court were all "Steps in aid of execution" of his foreclosure decree !nd therefore, the appellants' fifth exe- . eution application was witllln time, being within 3 years from the date of the final order in the High Court on January 1, 1962: [517 EHJ

Nagendra Nath Raj & Ors. v. Suresh Chander Dey & Ors. A.LR. 1932 P.C.l65/ 167, V. E. A. Annama!ai Chethar v. Val/iammai Achi and or1 .12 IA 296/303; Bhaw®ipore Banking Corporation Ltd. v. Gouri Shanker Sharma (1950]; S.C.R. (25) Rufba Narayan & Ors. v. Maharaja- Kapurthala AJ.R. 1936 Oudh 248, A.S.

Kr-uhanappa Chetfrar &: Ors. v. Nachiappa Chethar & Ors. [1964] S.CR. 241/252 etc., referred to.

CIVIL APPELLATE JURlSDICf!ON : Civil Appzal No. 1607 of 1967.

Appeal by Special leave from the Judgment and Decree dated the 3rd February, 1967 of the Madhya Pradeh Hi<>h Court at Jabalpur in Civil Misc. Second Appeal No. 124 of 1966. "'

B. D. Sharma for the appellant.

B. N. Lokur and A. G. Ratnaparkhi for the respondent.

The udgment of P. JAGANMOHAN Rmov AND S. N. DWivEDr, JJ. w~ _deltvered by DwrVEDI, J. P. K. GoswAMI, J. gave a dissenting Opmton.

DWIVI!Dr, J.-Kariya and his wife Sava purcbased the house in dispute by a registered deed on Apr_il 2, 1905. K1riya died in 1936 leaving behind him Sava and Ram Charan, his son. On August 16, 1951 Ram Charan mortgaged the house to Prem Raj (the appellant).

Prem Raj obtained a preliminary decree for foreclos.ur, e on August

SUPREME COURT REPORTS

£19741 3 S.C.R.

16, 1952 and also the .final decree on July 16, 1955. In the meanwhile on March 7,1952 Sava gifted the entire house to Prakash Chandra, son of Ram Charan, the respondent. Fortified by this gift.

Prakash .Chandra frustrated several attempts of the appellant to set ·

poss:::ssion of the house in execution of his decree. He made three unsuccessful -attempts to execute the decree till the end of 1954.

He made the fourth attempt on April 25, 1956 .. Shortly. thereafter, on December 7, 1956, Prakash Chandra instituted a suit against the appellant and his father Ram .· Cbaran for a declaration that the preliminary and .final decree for forecJosure in favour of the former were not binding on.him and for a perpetual injunction restraining the appellant from taking possession of the bouse in exetution of the aforesaid decree. The suit was dismissed on NoYernber 25, 1958. He filed an appeal and obtained an order staying execution of the decree on December 31, 1958. The appeal court partly allowed his appeal on October 21, 1959. It was held that he was the owner of a half share in the house by virtue of the gift deed from Sava in his favour. So the appeal rourt issued an injunction restraining the appellant from executing his decree with respect to a half share in the howe. The appellant filed a second appeal in the H1p

Court of Madhya Pradesh against the judgment of the appeal court.

Prakash Chandra also filed a cross-objection in respect of his claim for. the remaining half share in the house. Both the appeal and the cross-objection were dismissed by the High Court on JanWlry I, 1962 .

Turning back to the fourth execution application filed by the appellant, it was dismissed on June 23, 1Q56. The fifth execution E application was filed by the appellant on July 29, 1964 for possession ' over half of the house. The respondent objected to this applica / tion on the ground of limitation. The objection was disallowed by the execution court as well as by the appeal court. It was. however, upheld by the High Court of Madhya Pradesh. So the application was dismissed as time-barred. Hence this 'appeal.

The sole argument of the appellant in the High Court was that s. l.S Limitation Act, 1908 (hereinafter, called the Act) saved limitation.

The High Court rejected this argument. The order of the appeal court staying execution of the decree remained in force only for a .,.,_ limited priod between January. 31, 1958 and October 21, 1959.

That time should be excluded in computing limitation under a. 15 • but that alone would not have limitation.· '

Before us, counsel for the app.!llant ha~ not placed reliance on s. 15 to save limitation. His arguments now are : · • . ' 1.

Limitation is saved by clauses l, 2 and 4 of Ait. 182;

Limitation is saved by cl. 5 of Art. 182;

3. ·· The fifth application for exeution was really an application to rev1ve . the fourth execl!tJOn proceeding and therefore, it was not time-barred •.

l'REM RAJ V, RAM CHARAN (Dwivedi, J.) -497

We shall consider these arguments in seriatim. But b r. we do so, .it is necessary to read the relevant provisions of Art.e 1pg.

. "For the execution of a decree of Three

any civil court • • • years

l. The date of the deere~

·············

2. (where there ha.s been an

appc-.11) the date of the final decree •. ...... of the appellate Court

•• 0 ••• 0 ••••• 0 •••

4. (where the decree b; u

been amended) the date of amendment, or .

5. (where the application next hereinafter mentiOile<l

has been made) the date of the final order p~ on an application made iD

accordance with law to the proper court . .. . . . to taKe more rep in aid of eucution of the <kcrce ••.• Eltplanation II : "Proper Court" means the <Alan: whose duty it i3 to execah: the decree ...... "

Rexarding argument No. 1 : We are unable to appreciate how the High Court decree in Prakash Chandra's suit will give a fresh startin: point of limitation to the app::Uant undr cl. 1 of Art. 182. Clawoe

I is to be read ag1inst the backdrop of th~ words in the first columLl "for th~ execution of a decree." So the d1te of th'! decree (whether of te first court or of the appellate court) which is put in execution

furmshes the starting point of limitation.

Tite final decree in favour of the appllant was drawn up under Order XXXIV, rule 3 Civil Procedure Cod!. The decree absolutely debarre.d the respondent and all prsons claiming under him fom redzemng the mortg1g~. It also directed the respondent to d;:liver

passes~10n of the di<puted house which was mortgagd. The d-.te Wlls binding on th~ respondent and anyone claiming UJ_ldr him. !t could _not and did not purport to bind a tird person clrumJn, C any

snterest 1n th! house in his own right . . In hts sutt Prakash Chan, ra Chll!leng d th~ d<!cree, inter c.lia, on the ground that h:: was the sole Offner of th! house..

II~ claimed a declaration that th'! d cree "as not binding on him and a p::rmanent injunction restr.aining the appellant from taking possession of the house in execution of the deere~.

The app:al court found tlllt Pn1kash Chandra was the owner of a htlf share in th'! house by virtue of the gift from av.a wbo ~clt~ half share and that accordingly the decree was not bmdmg on hi . the ext~:nt of a half share. The app:al court granted a declaraton to that ffcct and an injunction restraining the appellant from .tatin~

pas.esswn of the half share of Prakash Chandra 1n the house

1db.

CUhon of th! dcree. The dcree of the appal court was affirmc } th: Hifh Court.

;7'" - . . ~· --~-...

498 SUl'REME COURT REPORTS

£19741 3 S.C.R.

It is plain-that neither the decree of the appeal court nor the dec- ·- rec of'the H!gh Court. reversed; varied or amended in any manner _ the fina1 foreclosJ.lre decree of the appellant. The foreclosure decree remained in tact and fully alive ... It could be executed against . the

respondnt according to its tenor. He could be ejected from the

whole ht>use. But it could never have any effect ~Jgainst Prakash Chandra's pfmaount title to a half share in the house.

Prakash Chlndra obtained his decree in a collateral suit. Tht

applbint's second appal against the decree of the appeal court in favour of Prakash Chandra was not directed against the foreclosure decree now in execution, nor would it, as shown earlier, effect the decree in any manner. in relation to the tespondent-judgnent d!btor.

So his appal and the High Court decree p1ssed in his appeal would not fall within cl. 2 and 4of Art. 182 and would not furnish a fresh startins pint of limitation for executing the foreclosure decree aeainst theresp:>ndent-judgment debtor. (See Bhawanipore Banking Corporation Ltc/. v. Gorl Shanker Sharma(l).

The appellant has relied on Mohammad Jabir and others v. Narain Prasad Daruka and others (2) and Janab Mohammad Ismail v. Tothna

liM Amra/ and others. (3) n-these two cases the decree sought to be executed itself was amended. So clause 4 of Art. 182 was directly applicable.

Regarding argument No. 2 : In order to get the advantage of cl. 5 of Art. 182, the appllant has to satisfy three conditions :

(a) Th~ written statement filed by him in Prakash Chandra's

suit, his resistall'C: to the first appal of Prakash Chandra and his second appeal in the High Court are an "application."

(b) The court in which Prakash Chandra's suit and first appaal

were instituted and the High Court wherein the appellant's second appaal was filed are, the "proper court".

(e) Th~ proceeding~ spified in (a) are a step in aid of execution of the decree sought to be e)(ecuted by the appellant.

An app!ication is "the making of an appeal, requst, o~ etition to a prson; the request so made.'' (Shorter Oxford Enghsh Dtchonary,

1955 Edn. 86) Thus the making of a request to a person is of the essence of an application. In some cases it has accordingly been held that 'the plnt is an 'application' within the meaning of that word incl. 5 Art. 182. (See Rudra Narain v. Maharaja of Kapurtha/a.(4) The Bom, bay, Calcutta and Madras High Courts have, however, held to the contrary. (See Raghunandan Prasad v. Bhaggoolai.(S) It is unnecessary to resolve this conflict of opinion between the High

Courts in this appeal. To oppose Prakah Chandra's suit, the appel~ lllllt had filed a written statement . So we are directly concerned with the question whther a written statement is an 'application' within

. (1) [19SO] S.C.R. 2S at p. 29.

(2) A.I.R. 1960 Patna 126.

(3) I.L.R. [1965] 1 Madras 176.

(4) AJ.R. 1936 Awadh 248. (S) l.LR. 17 Cal. 268.

i /

PREM RAJ V, RAM CHARAN (Dwivedi, ./,) 499>

the meaning of cl. 5 of Art. 182. According to Order VII r. 1 Civir ' Procedure Code the plaint should specify the relief which the plaintiff claims. So it may be plausiBly argued that the plaint, which

makes a request to the court,- is an "application". But unlike the plaint, the written statement ordinarily does not inc1ude any request to the court. It is simply a defence to the plaintiff's claim. Order- VIII Code of Civil Procedure deals with matters which ought to be included in a written statement. Rule 6 thereof enables the defendant to make a claim for set-off. To the extent the written statement includes the claim for set-off, it may be treated as a plaint. It is perhaps arguable that a written statement filed in an interpleader suit may also be treated as a plaint. But we express no opinion on this ast. Leaving aside rule 6 and the interpleader suit, there is nothing in Orders VI and VIII, Code of Civil Procedure to show that a written statement could legally include any request to the court.

We are aware of the general practice in the Mufassil of including in the written statement of prayer that the suit should be dismissed with: c.osts. But this prilyer is supererogatory and would not convert a written statement Simpliciter into an 'application' within the meaning of cl. 5 of Art. 182.

In Panna La/ v. Smt. Saraswati Deri (1), the judgment dbtor made an application under Order XXI, r. 2 Code of Civil Procedure to the execution court alleging payment to the decreeholder outside the court. The decreeholder filed a written objection denying payment. The application was ordered to be dismissed. The appeal from the order met the same fate. The High Court held that the time for filing the execution application ran from the date of the appellate order.

The High Court said : "(It was) of the opinion that the words" •:to take some step in aid of execution of the decree" .... should be Interpreted' liberally ln favour of the decreeholder. If he has taken any step which would remove as an obstacle to the further cxccut i::.n of the decree, he would be entitled to 'the benefit of the provision. In the present case the decreeholder took steps to set aside the objection which. w:; ts an hindrance against execution and was therefore a step-in-aid of execution." Plainly, the High Comt has assumed without any discussion that the written objection of the decreeho!der to the application .of he jugtent-debtor under Order XXI, r. 2 C. P. C. was an apphcatlon w!thtn the meaning of cl. 5 of Art. J 82 and has then proceeed to dectde weher the said objection was a step-in-aid of execulOn.

I~ o, ur optmon, the assumption was wrongly made.

The wntten ObJeCtton of the decreeholder could not be regarded as an

'apl!cati.on' . The Punjab High Court has followed the Allahabad dectslOn m artar Singh v. Sultan Singh Partap Singh (2). Like the Allahabad H1gh Court, the Punjab High Court also has erroneously

assuned. that the. written objection tiled by the decreeholder to the

app~Ic.atro!l of the JUgment-debtor for reopening the case and for settmg asrde the decree was an application.

(J) A.l.R. 1960 All. 572.

(2) A.I.R. 1967 Punjab 375.

.soo

SUP.KEME COURT REPORTS [l974J 3 S.C.R.

Counsel for the appellant has strenuously attempted to pursuade us to give a liberal construction to the word ,'application' i~ ct. of Art. 182. We do not think that the rule of hberal construction gtves a free hand to the Court to stretch and strain the statutory laniuage

to accord with our abstract notions of justic~ and fair play. In

ur view. if the statutory language is. susceptible of two constructions, the rule of liberal construction should incline the Court to prefer the one which accomplishes the legislative purpose. ut where the statutory language will b!ar one and only one meanng, there is no room for the application of the rule of liberal construction.

Howsoever liberally one may construe the word 'application', it is not possible to regard the written statement of the appellant in Prakash Chandra's suit as an 'application•, for it made no rquest to the oourt.

Just as the written statement of the appellant cannot be regarded as an 'application', so also the resistance to the appeal filed by Prakash Chandra cannot be held to be an 'application'. Counsel for e .

ppellant, however, submits that the appellant'~ econd appeal in the High Court would be an 'application'.

In V.E.A.. AnnamaJai Chettlar v. Valliammai Achi(1) the Privy Council has held that an appeal filed by the decrceholder is an ·•application'. It may be a~umed that the appellant's second appeal in the High Court is an 'application' within the meaning of cl. 5 -of Art. 182. But this does not conclude the matter in favour of the appellant. He has to show that the High Court is the "proper court". '"Proper Court" is defined in Explanation IT to Art. 182, as "the court

wboe duty it is to execute the decree." Ordinarily, the High Court will not b~ the ''proper court" as so defined, because it is normally not the duty of the High Court to execute a decree. According to s.38 Civil Procedure Code a decree may be executed "either by tile court

which passed it or by the court to which it is sent for execution, So "the proper court" would be the court which passed the foreclosure decree in favour of the appellant. The appellant can derive no as!i9tance from Annamaloi(supra). 'In that case the decreeholder had made an application for execution of his decree in the proper court. 1be judgment-debtor filed an objection. It was allowed. Then tbe -decreeholder filed an appeal in the High Court. The appeal w.s

<lismied. The Privy Council held that the time for rnakina t)e execution application ran from the order of the High Court. RepeJ. iing the argument of the judgment-debtor that the High Court was not the proper court, the Privy Council said :"Under s. 187 of the Code of Civil Procedure an appeal court has the same powers as are conferred and imposed by the Code on courts of original jrisdiction. Where .(In application for execution is dismissed by the fewer court, the appeal

court is the proper, and indeed, the only, court which can then excute Jhe decree. No doubt in practice a High Court does not itself generally extcute the decree of lower courts; normally it remands the case to the Jower court with directions to execute according to law '.on: the basis

(I) 72 Indian Appeals 296.

PREM RAJ v. RAM CHARAN (Dwivedi, J.) 501

of the High Court's decision ; but in a proper case the ~h Court would no dGubt execute the decree or order itself." (emphasis added) It is clear from this passage (especially from the words sho_wn in emphasis) that the Privy Council regarded the High Court as tJte 'proper court' on account of the fact that the decreeholder had ·-applied for execution of his decree in the 'proper court', It was held that the appeal court entertaining an appeal from the order of the execution court is the proper court. Such is not the case before us.

It may be pointed out here that in the courts below the appellant did not place reliance on Art. 182 for saving limitation. So there is n() finding by the court below on the point as to whether Prakash Chtndra's suit was instituted in the court which could execute the inal foreclosure decree of the appellant. The record before us does

not unambiguously make out that the suit was institud in the court "hich could execute the said decree. The foreclosure decree was. pused by the Civil Judge, Class II, Balaghat. It appears from the plaint in Prakash Chandra's suit that the suit was instituted in the Court of the First Additional Civil Judge, Balagbat attached to the Seconel

Ci'ril Judge, Balaghat. . But the judgment of the appeal court in Prakash Chandra's first appeal indicates that the suit was instituted in tkt: court of the First Additional Civil Judge, Balaghat attached to the court of the First Civil Judge, Balaghat. So it is not certain whether

Prabsh Chandra's suit was instituted in the court which could execute the final foreclosure decree of the apP.ellant.· But even if it is assumed

that the suit was instituted' in the court which could execute 1he said decree, we are unable to hold that the_ appellant's second appeal to the High Court arose out of an "appli((ation" made to -the ''proper court" because. his written statement in the suit was not atl "application" made to the proper court. So the appellant cannot aet the benefit of cl. 5 of Art. 182.

The Allahabad and Bombay High Court£ have taken the view that time would run from the date of the appellate order. (Baldeo Singk v, &m Swarup(l) and Joshi Laxmirarn Lallubhai v. Mehta Ba/asltt1nkar

Veniram(2), In Baldeo Singlt (supra) an application for execution was. made by Baldeo Singh, who was the assignee of . the decreeholder on July 15, 1916. About a year earlier, the property against which the decree was to be executed had been sold to Ram Swarup and Jai Dayal inexecution of a simple money decree. Ram Swarup and Jai Dayal' instituted a suit for a declaration that the property purchased by them was not saleable in execution (,)f the decree by the assignee, BaJdeo Singh. They also claimed an alternative relief that they were entitled to a prior charge of nearly Rs. 2.~/- on the property. While this suit was pending, the assignee's application for execution was dismissed. Thereafter the SQit was dec1eed in respect of the alternative relief only. Baldeo Singh filed an appeal from the decree. The appeal court allowed the appeal and dismissed the suit on March 19, 1918.

Baldeo Singh then filed an application for execution on September 30,.

(1) A.l.R. 1921 AU. 174.

(2) lL.R. 39 .Bombay 20.

. (19741 3 S, C, R.

19l9: t was made thre years aftr be dismissal of the previous applicatton. The execution court diSmissed the application as. timebarred. The first. appeal court upheld the order of the execution court. {)n appel, .the ljh Court held that the application or execution was

ade w1thm :t1m7. O:a: of the reason~ giv.en by the High Court .tn suppo!t of 1ts Vle~ was that te appeal file~ by the assignee was a . . step-m-a1d of execution. The High Court said : "There IS another .aspect of the cae from which also this application would be within time. The suit, as we have stated above, was for two reliefs : (1) that the property was not saleable and (2) the alternative relitfwas that the property was subject to a prior encumbrance. On the 18th of July 1917, the Court gave the then plaintiffs the seconil relief claimed by them, namely, tat they.could put up their prior charge of nearly Rs. 2,000/- as a shield agamst any person who got the proprty in execution. In order to remove this difficulty in the way f the execution .0f his decree unconditionally the decreeholder appealed successfully.

The decree of the 19th March, 1918 would go to show that this appeal must have been filed within .~ years of the present application for exe- cution and this must b: considered to be a step-in-aid of execution, .as by it the decreeholder wanted to remove certain difficultis which .sto()d in the way of his getting the full benefit of his decree. From this -view also the present application i~ within time."

It may be obs:!rved that the High Court did not consider at all the question whether the appeal was an 'application' made to the ''proper .court" as defined in Explanation li of Art. 182.

In Laxmiram Lallubhai (supra) the judgment-debtor applied to have himself declared an insolvent. In the circtm; istances, the decreeholder could not have the judgment debtor arrested in execution of his decree ' :if he was declared an insolvent, and consequently he opposed the application and when that was unsuccessful he appealed against the order .declaring him insolvent. It was contended that if s.lS of the new Limitation Act of 1908 be held inapplicable, his opposition to the in- . 50tvency of the judgment debtor should .be regarded as a step-in-aid of the execution of the decree under Art. 179 of the old Limitation Act, 1877, corresponding to Art. 182 of the Limitation Act, 1908. Beamon, .J. speaking for the Division Bench, found some difficulty in bringing

sch an apphcation (application opposing the application for insolvency) within the meaning of the words 'application to take some stepin-aid of execution' under Art. 179 (old), now Art. 182 of the Limitation Act. But when the result of the proceedings went against him, the -creditor {appellant appealed to the District Court and succeeded. Adverting to lhis aspect, the learned Judge said:

"We think that it is not putting too great a strain upon ordinary language to say that an appeal in such circumstances fairly false within the meaning of the words: 'an application to take a step-in-aid of excution'. It. is clear that as long as the insolvency proceedings went tn favour of the debtor, the creditor could not have presented any application in ordinary course for the further execution of his decree with the least hope of success".

PREM RAJ V. RAM CHARAN (Dwivedi, /.) 5()3

Tho appellant had no other course open to him, ifthe debtor was declared insolvent, than in the first instance to get this bar to the further execution of his decree removed.

And the only way in which he could hope to obtain that result would be by first opposing the

iniolvency petition in the first Court and if he failed there by appealing to the higher court. .While so holding, the learped Judge struck a note ofcaution:

"Adopting that view, it is unnecessary to enter into any of the other nice and difficult questions which have been raised and adequately argued in the course of this appeal.

We do not seek to lay down any general principle upon any

of those questions, but we desire to confine our judgment to the rather unusual facts before us, and we think that we do not violence to the meaning of Article 179 (old), now Article 182, by holding thstt the present darkhast is within three years of the last application made by the judgrr.ent-creditor to a Court to take some step-in-aid of the execution of his decree."

This case neither considered whether the application opposing the insolvency was an ' application', nor whether the Insolvency Court was the 'proper court', within the meaning of cl. 5 of Art. 182 of the Limitation Act. On the other hand the Madras High Court in Chat{fall gali Rarichan v.

Puvvanparambath Kunhamu(l) held that an application to the Insolvency Court for leave to execute the decree against the insolvent is not an application made to a proper court, because it is entirely a creature of the Provincial Insolvency Act and is therefore a different Court to the Court which is to execute a decree obtained independently of the insolvency Act. The mere fact that the Presiding Officer of the Insolvency Court and the Court executing the decree is the same person will not make the application to the Insolvency Court as one to the Court entitled to execute the dec ree. lAxmiram Lalubhai's case and the observations cited by us were considered and it was pointed out that explanation II to Art. 182 which defines.what is the proper court was not at all alluded to in the judgment. It is not necessary to refer to other decisions because il1 our view thr period spent in taking a step in aid can be excluded only if the Court in which the step is taken is a 'proper court.', The facts in C.P. Syndicate Ltd. Nagpur v. Firm Hasanali Abdul Ali (2) and Rajendra Prasad v. lndrasan Prasad are similar to the facts in A11na malai(supra). ln the first of the cases, it was an appeal from an order of the executing Court dismissing an objection to the execution. In the second of them, a\ so, the appeal which was considered to be an application to take a step in aid was one against an order of the executing court. Both these cases relied on the decision of the Privy Council in Annamalai (supra).

As we have held that the appellant's appeal in the High Court was not. an application, to the 'proper court' it is unnecessary to decide

_!ether in the)uit and in the appeal filed by Prakash Chandra the

(lli.L.R. 57 Madras 808.·

(2) A.I.R. 1959 M.D. 28& (fB).

(3) A.l.R. 1954 Patoa 46.

50 4 SUPREME COURT lt.EPORTS £19741 3 s.e.R.

written statement of the appellant and his resistance to the a~ and his second appeal in the High Court amounted to a step..tnaid in execution of the decret sought to be executed by him •

.Rqarding argument No. 3: An application may be saidto be one seeking to continue or to revive the previous execution application if (I) it is in the eye oflaw still pending or has been dismissed for no fault 8 of the decreeholder and (2) if the two applications are in substance similar in acope and character. Where the previous application for execution has been properly and finally disposed of by the execution court, the subsequent application cannot be said to be in COilti •uation of it or to be a revival application. (See r adlamtm~ati Bafa Trllura Slltfdaramma v. Abdul Khader) (1), In the present case the previoua application (the fourth application for execution was disc miSIIed on June 23, 1956. The execution court made this order: "Docrceholder in person; judgment-debtorabsent. Process fee not pai•.

Dismiued as wholly infructuous." It appear& from the judgment of the appeal court, dated November 28, 19S6, that tho execution -· court had diamissed the execution application on June 23, 19S6 as the

appeUant bad failed to pay process fcc for the warrant of possession.

It is plain from these orders that the previous execution application D was not tept pending. On the C9ntrary, it was dismissed on account of .the appellant's failure to pay process fee for the warrant of possel&ion. Accordingly the last application for execution made on , fuly 28, 1964 was not an application for continuing or reviving the_ previous application made on November 28, 1956.~

CoUD.8el for the appellant has relied on Prem Narain v. Gan1a .Ram,(1) E Hita l41 v. P:mjab National Bank(3) ./Cotta .Annaprunromma v.

Mtlkku Jlenkomma,(4) Kal/iappa Goundan v. Kmtdaswami Gowrdat(')

and C!rmMmmall•. Chennappa Goundan.(6) -

In the first case the decrecholder and the judgment debtor compromised and agreed tilat the latter should be given three months' time for paym:ent of the decretal sum and that i.f he failed to pay within F the satd period the execution should proceed. The court then ordered: "The execution case be struck off for the present". The judr; ment debtor did not pay the amount within the agreed period.

Then the decreeholder fiJed an application for execution. On te judalllcnt debtor•s objection that jt was time-barred, the Alahabad

Hish Court held tllat the application was one to revive the execution proceedings. The facts of the case are plainly distinguishable from G the facts of the case before us. The execution application was not finally dispased of and, in any case, the decreeholder was not at fault.

Ill the second case, the decreeholder had applied for execution by attachment and sale of certain property. One Kansbi Ram filed an objection that he had a lien on it. The objection was allowed and

. (1) A.I.R. 1933 Madras 418.

(J) A.T.R. 1935 Lahore 911.

(S) A.f.R. 1938 Mad. 498.

(2) A.I.R. 1931 All. 4S8 •

(4) A.J.R. 1938 Mad. 323.

(6) A.T.R. 19S8- Mad .. 21.

PREM RAJ V. P.AM CHAllA~ (Dwivedi, !.) 505

the proceedings in execution were stayed because the decreeholder had instituted a suit under Order XXI, r.63 Code of Civil Procedure and did not wish to proceed with the execution tilt the decision of the suit. The suit was decreed, but a little before that the application for execution was dismissed in default of the decreeholder and the .attached property was released. The subsequent application was JTlade to revive the previous application and to sen the property which had already been attached after the decision of the suit. In the mean. while Kanshi Ram preferred an appeal to the High Court. So the execution court directed that the application 'be filed for the present.

They can be restored when appeals in the High Court are decided.' When the appeals were dismissed, the decreeholder applied for the sale of the property which had already been attached. The judgment debtor then objected on the score of limitation. The Lahore High Court held that the subsequent application was one to .revive the previous application (which was dismissed in default). It is true that the previous application was finally disposed of and that too for default of the decreeholder, but it may be recalled that at the request of the decreeholder the execution court had 11tayed the execution proceedings until the decision of the question of Kanshi Ram's lien.

The court therefore could not dismiss the execution application for default of the decreeholder before the decision of his suit under Order XXI r.63 Code of Civil Procedure. As the order of the court was not correct, the appli cation was deemed to be pending. Thus understood, the decision

would not be helpful to the appellant.

The third and fourth cases have nothing to do with the question of revival of an execution application. In the last case the exe cution application was ordered to be dismissed.

More than three years threafter the decreeholder made another application. The judgment-debtor objected on the ground of limitation. His objection

was overruled . A learned Single Judge of the Madtas High Court held that on the facts and circumstances of the case, as construed by him, the J:revious application was really pending and that the subsequent application fell under c1.5 of Art. 182 . On the facts as construed by him the case becomes distinguishable from the facts of the present case. We should, however. make it clear that we should not be understood to have given our approval to the decision.

Counsel for the appellant has submitted that it is a hard cue for the decreeholder, for he is losing even half the share in the disputed house. That is so, but the blame lies squarely on him.

He could have executed his decree with respect to the half share in the house after the decision of the appeal court. But he did not avail of the opportunity and waited for the decision of the Rich Court in the appeal and cross-objection filed by Prakash Chandra.

He was not vi&ilant . and should suffer the consequences .

• 4..s a result of the foreaoina discussion, we are of opinion that tile High Court riahtly dismissed the fifth application as time barred.

So we disllliis the appeal. Bat in the circumstances of thii ca.se parties shall bear their own costs. 4-M 45 Sup CI/75

SUPREME COURT REPOR1 S

[19741 3 S.C.~.

. GoswAMI, J. The interesting and important question which is

raied _in ts appeal with special leave is whether the present appli- .

tJOn for execution, the fifth of its kind in this case, is barred by

limitation under article 182 of the Limitation Act, 1908. .

 In order to appreciate 'the above question of law, a brief reference to the history of the litigation is necessary. One Kariya and his wife n Sava purchased the suit property, which is a house, by a registered sale deed of 20th April, 1905. Kariya died in 1936 leaving behind his widow, Sava and their son Ram Charan, the prese-nt respondent.

Ram Charan alone executed a registered mortgage deed of the entir~ suit property on 16th August, 1951, in favour of Prem Raj, the present :i!ppe1lant. Prem Raj instituted a: civil suit No. 27A of 1952 on the basis of the mortpage deed and obtained a preliminary deetee for c foreclosure on 16th August, 1952 2.nd also the final decree on 16th

Jul~ 1953.

Sava, tbe mother of Ram Charan, on the other hand, had executed a registered deed of gift of the suit property on 7th March, 1952. in favour of Praka:; h Chandra, son of Ram Charan, the respondent. Basing his claim on this deed of gift. Prakash Chandra, then a minor, by his father's sister, as next friend, filed a civil suit on December 7, 1956, beinp: D No. 75A of 1957 impleading the present appellant as the 1st defendant and his father, Ram Charan, as the .2nd defendant. Prakash Chandra claimed to be the sole owner of the suit property and described his father Ram Charan as a .. gambler and drunkard" in the plaint in that suit. He prayed in the suit for declaration that the preliminary and the final decree for foreclosure ofl6th August. 1952 and 16th July, 1953, respctively in the civil suit No. 27A of 1952 were r:ot binding 1 on him and that Prem Raj, tt.e 1st defendant therein, "be restrained through a perpetual injunction from taking posession cf the house in. dispute in execution of the aforesaid decree". This suit was dismissed on 25th November, 1958. Prakash Chandra lodged an appeal against that judgment and decree and obtained stay of the execution of the aforesaid foreclosure decree in suit No. 27A of 1952 on 31st Dec-ember, 1958. His appeal No. 3JA of 1959 was partly allowed F by the First Additional District Judge, Chhindwara, reversing the earlier decree of 25th Novernber, 1958 and declaring that Prakash

Chandra was entitled to the half share in the suit property.

The decree 1'.'as. inter alia, in the following form:-

...... it is ordered and declared that the decrees in Civil .

Suit No. 27-A of 1952 of the Court of Civil Judge, Cls H.

Balaghat, are not binding on the plaintiff to the extent of half share in the house in suit and it is further ordered and decreed that the defendant No. I is hereby restrained from takin,.; possession of plaintiff's half joint share in the house in suit in execution of his aforesaid decrees".

Prem Raj bein~ dissatisfied with the judgment and decree lodged a second appeal (No. 107 of 1960) in the High Court of Madhya Pradesh. Prakash Chandra also filed a cross objection with rerd to

PREM RAJ V. RAM CHARAN (Goswami, ].) 507

his claim for the other half of the suit property. Both the appeal and the cross objection were dismissed by the High Court on Ist January, 1962.

Thus being free from the above mentioned litigation, the appellant, Prem Raj, filed his fifth execution application on July 28, 1964, in the Court of the Civil Judge, Class II, Balaghat, praying for "joint possession of the half of the house to be delivered from the judgment debtor along with (the half joint possession of) Prakash son of Ram Charan Gadhewal".

Since this is the fifth application forexecution, let us look in retrospect to the four other execution applications filed c:arly by the appellant as decree-holder. These may be given s:>riatim as under :-

27-7-1953 : The appellant filed the first execution application for obtaining possession of the suit house in execution of the final foreclosure decree in civil suit No. 27A of 1952.

8-10-1953 : The app;!ltant was unable to obtain possession and the execution application was consigned to the records.

31-10-1953 : The second execution application was filled by the

appllant for p::>SSession of the suit house.

6-8-1954

.)0-8-1954

11-l-1955

25-4-1956

4-5·1956

[ 23-6-1956

The second execution application was also consigned to the records as he was unable to obtain possession.

A third execution application was filed by the ap

pllant for possession of the house.

The third execution applicaton was also consigned to the records as the appllant was u.nable to obtain pJssession of the suit house.

The appdlant filed his fourth execution application for p;:, ssession of the suit house and also filed an application for police aid as he made several attempts in his previous

cxecution applications to obtain possession of the suit house but he was obstructed by the respondent and his relations and that it was not possible to obtain possession of the suit house in execution -without police aid:

The application of the appdlant for police aid was

rejctcd by the executing court and it was ordered that an t>ttemot should be made again to obtain possession without the police aid.

The executing court dismissed the fourth execution application of the appellant as wholly infructuous as the app:llant considered it completely useless to obtain and execute a fresh warrant of possession again without police aid and so did not pay process fee and imt•ad filed an appeal in the District Court against the order .of the executing court.

508 SUPft.EME COURT REPORTS

U974J 3 S.C.R.

28·11·1956 : The appeal of the appellant against the order of the A executing court refusing police aid was dismissed as the said order was not appealable and the execution case was consigned to the records.

Reference has already been made to the civil suit No. 75A of 1957 iled by Prakash Chandra on December 7, 1956, which resulted ultimately in his partial success entitling him to half of the suit B property, the whole of which was the subject matter of the foreclosure

•ecree in suit No. 27A of 1952.

To revert to the present execution case out of which this appeall, las arisen, the respondent objected to the aforesaid fifth and last ext ution application on the ground of the same being barred under article 182 of the Limitation Act, 1908 his objection was dismissed by the oxecuting court as well as by the Additional District Judge in.appeaJ.

The respondent then filed a Miscellaneous Second Appeal No. 134 of 1966 in the Madhya Pradesh High Court against the judgment of the Additional District Judge, Balaghat. The High Court on 2nd March 1967 accepted the respondent's appeal and set aside the orders of the courts below and l'leld that the execution application of the appellant was barred by time and should be dismissed. The appellant's application f'Jr leave to appeal to a Division Bench under the Letters Patent

was rejec.'ted by the learned Single Judge. Hence this appeal with special leave.

The question in this appeal is whether the appellant (decree-holder) is entitled to exclude the period covered by the suit filed by Prakash Chandra upto Ist January, 1962 on which date the High Court dis- Dissed the appellant's, second appeal as well as the respondent's crossobjection arising out of that" suit. To put it differently whether the appellant's filing of the written statement in Prakash Chandra's suit and his resistance to his appeal which resulted in partial mutilation of b.is foreclosure decree and lastly his memorandum of appeal before the High Court against the decreeare a series of steps in aid of execution of his foreclosute which has been passing through vicissitudes of success and failure in the course of litigation.

Mr. Lokur, learned counsel for tne respondent, submits that section 15 of the Limitation Act would not come to the aid of the decreeholder since there was no stay of execution of the decree by any court after disposal of the appeal by the First Additional District Judge on 21st October, 1959. There was, therefore, no impediment in the way of the a, ppellant executing the -decree thereafter, says Mr. Lokur.

With regard to the further contention of Mr . Sharma, learned counsel for the appellant, Mr. Lokur submits that article 182(2) will not apply as the appeal was not directed against the original foreclosure decrc which was sought to be executed.

In this appeal Mr. Sharma concentrates upon two submissions. Firstly, according to him, the present case is fully covered by article 182(5) as the appellant'~ ristance to the suit of the judgment-debtor's son in civil suit No. 75A of 1957, thereafter to. the civil appeal arising. out of it and 1ater himself proc

PREM RAJ v. RAM C~RAN (Goswami, ].) 509

secuting a second appeal in the same mauer to defend his foreclosure decree in suit No. 27A of 1952 are all directed to remove an obstacle -· in the way of the execution of the original foreclosure decreo and hence the same are "steps in aid of execution of the original decree" under article 182(5) and saves running of limitation. The learned counsel, therefore, submits that the fifth execution application of 28th July, 1964, being filed within three years of 1st January, 1962, on which date the High Court finally dismissed the appellant's second appeal and the respondent's cross objection, is within time. Alternatively the counsel submits that the fifth execution application is not a fresh

application but a revival of his fourth application of 25th April, 1956 and there is, therefore, no questiOJ' of the same being barred by limi tation in this case.

It is no~ necessary to take up-the appellant's submiss1on.on the .; core of article 182(5) of the Limitation Act. It will be appropriate, therefore, to quote the same

Description of Application.

Period of Time from which period Limitation. begins to Iun.

182. For the execution of a d.ecrec Three or order of any Civil Court not pro Years.

vided for by art. 133 or bys.48 of the Code of Civil Procedure, 1908.

X X X

5. (Where the application

next hercinartcr men tioned has been made) the date of the final order passed on an ap]llication mad!! in accordanoe with law to the proper Court for execution or to take 6ome step in aid of exe cut!on of the decree or order, or .....• "

In the present appeal what is material is the second branch of article 182(5) in the third column, namclv, "to take some step in aid of

execution of the decree". ·

The learned counsel on both sides submit that there is no direct authority of this Court on the point although a large number of decisions from the High Courts disclosing a cleavage of opinion and a few decisions from the Privy Council were cited at the bar in order to throw light on the subject from the respective points of view of coun set.

As early as 1932, the Privy Council in Nagendra Nath Dey and another v. Suresh Chandra Dey and others(!), while dealing with the ex pression "whether there has been an appeal under column 3 of article 182(2)", and noting the difference of opinion among the authorities in India on the subject observed as follows :-

''The fixation of periods of limitation must always be to some extent arbitrary, and may frequently result in hardship.

(1) A.l.R. 1932 Privy Council 16S/167.

510 SUPREME COURT JlEPORTS r1974] 3 S.C.R.

But in construing such provisions equitable considerations are out of place, and the strict grammatical meaning of the words is, their Lordships think, the only safe guide. It is at least an intelligible rule that so long as there is any question sub judice between any of the parties those affected shall not be compelled to pursue the so often thorny path of execution which, if the final result is against them, may lead to no advantage. Nor in such a case as this is the judgment debtor prejudiced. He may indeed obtain the boon of delay, which is so dear to debtors, and if he is virtuously inclined there is nothing to prevent his paying what he owes into Cour~".

Again in V. E. A. Annamalai Cfu:ttiar v. Valliammai A chi and Anothcr(l),

the Privy Council dealing with article 182(5) of the Limitation Act left the matter open observing as follows :-

"There has been some difference of opinion in the courts in India as to what amounts to takinz a step in aid of execution and the judgment under appeal discusses various decisio:rs,

including a decision of the High Court of Madras in Kuppaswami Chettiar v.

Rajagopala Aiyer(2), in which it was held that there could not be a step in aid of executioJl if there was not an application for execution then pending, and another decision of the same court in Krislma Patter v. Seethar• ama Patter (3), in which it was held that a step in aid of execution must be one in furtherance of execution and not merely one seck¥ ing to re~:nove an obstructi011 to possible future execution.

Their Lordships do not find it necessary to e)( press any opinion on these C]uestions, since in the present case there was at all material times an application for execution pending ...... "

The expression "sicp in aid of execution'' is Jh)t defined in the Limitation Act nor is it capable of a precise or exhaustive dellnition. 1t will have to be construed in the light of the facts and circumstances in each case and the present case is indeed a peculiar one with litigation raised on two fronts, the parties with diametrically opposite avowed objects one (namely, the appellant) to execute and reap the fruit of the foreclosure decree and the other (namely, the respondent judgment-debtor's son) seeking the assistance of the court to completely nullify the very decree in order to maintain his Litle to and possession of the suit property.

In the above context, can the successive steps taken by the appellant in resisting the respondent son's claim in the Jatte, r's suit and the former's other consequent actions thereafter in the original court. appellate court and lastly in the High Court. be construed as ''steps in aid of execution of the foreclosure decree''. It is strenuously con. tended by the respondent that all these steps are in connection with a.nother suit and not with the original suit out of which the present execution petition was filed. Both sides referred to a decisil>n of this

(I) 72 Indian Appeals 296/303. (2J 1922 LL.R., 4.'i M. 46ti

(3) 1925 I.L.R., <o M. 49.

h-·

c '" ·~·~

. A

PREM RAJ v. RAM CHARAN (Goswami, J.) 511

Court in Bhawanipore Banking Corporation Ltd. v. Gouri Shanker Sharma( I), which however, was a case under article 182(2) of the Limi: tation Act and referred to the following passage at page 29 of the decision:-

'It was also suggested by the learned counsel for the appellant that the case might be held to be covered by clause 2 of article 182 on the ground that, even though no appeal was preferred from the final mortgage decree, the words "where there has been an appeal" are comprellensive enough to include in this case the appeal from the order dismissing the application under order IX, Rule 9, of the Civil Procedure Code, made in connection with the proceedings under section 36 of the Moneylenders Act. This argument also is a highly far-fetched one, because the expression "where there has been an appeal" must be read with the words in column 1 of article 182, viz., "for the execution of a decree or order of any civil Court ...... " and, however, broadly we may construe it, it cannot be held to cover an appeal from an order which is passed in a collateral proceeding or which has no direct or immediate connection with the decree under execution".

The learned counsel for the appellant seeks to derive great support from the words "which has no direct or immediate connection with the decree under execution in the above excerpt. It is apparent that the facts of the case before this Court in the above decision are clearly distinguishable and there was no direct connection between the

application etc. Tor revival of a collateral proceeding under, order 9 rule 9 and the original decree sought to be executed. On the contary if it is possible to find in a sui~ or a proc\':eding a direct ard immediate

connection with the original decree, the result whete of will be or even likely to b;: affected be the particular suit or proceeding, the matter may be entirely different. What is then the exact legal position on the facts and circumstances of the perscnt executing case ris-a-vis the suit of Prakash Chandrawhich mutilated the foreclosure decree to the extent of depriving the appeHant from executing in respect of half of the suit property earlier decreed in his favour? Would the appellant execute or even reasonably be expected to execute his whole decree while his right to do so has already been under challenge or in a jeopardy in a civil suit? Would the appel\ant be expected to have a sort of clairvoyance or pre-science about the result of the suit which he is defending and, therefore, execute the decree confidently and seek to recover the property without the least risk of any future litigation?

In a legal adventure of this type multiplicity of litigation and selfcreated complications in case of an ultimate failure in the sUlt, may be writ lrge ill the nature of things. Would he still tread on the "thorny path of exl!cution'' '? In the face of ambiguity or doubt, for long, recognised in courts, if a beneficient constructiOn to the wvrds "step in aid of execution" in article 182(5) of the Limitation Act could be given, it will be only giving effect to the law and not to equity which is out of bounds in limitation.

!J) [1950] S.CR .:' .•

512 SUPUMB COUIT ll!POJ.TS

U97~1 3 S.C.R.

It may be clearly noted that there ia no controversy between the . parties in this appeal with regard to "the proper court" for execution within the meaning of the nd explanation of article 182(~) of th• Limitation Act. It stands to reason, therefore, that no argument was advanced by the parties' counsel on this acore. The only controversy is with regard to the benefit of the time consumed in the entire litigation commenced in civil suit No. 75A of 1975 and the consequent appeals thereafter. It will be, therefore, difficult to visit the appellanl with an evil consequence without affording him an opportunity to meet such a possible objection which even lacks certainty and definiteness on the records of this appeal.

Some of the High Courts seems to lean towards a fair and liberal interpretation in favour of the decree-holder in the construction of

rticle 182{5) in respect of what is "step in aid of execution" ofadcree (See Rudra Narain and others v. Maharaja of Kapurthala (1); Kotta Annapuranamma v.

Makku Venkamma(2); Panna Lol v.

Smt. Saraswati Devi(3) and Uma Shankar Mehrotra v.Kanodia Brothers, Kanpur and another(4). It is not possible to read these decisions as judicial exercise to give effect to equity superimposed upon law.

The respondent's counsel on the other hand draws our attention to the strict construCtion of section 15 of the Limitation Act, which is, however, not relied upon by the appellant, in A. S. Krishnappa Chettiar {k Ors. "· Nachiappa Chettiar& Ors.(S) and relies upon the followina passage :

"The question is whether there is any well-recognised princi pie whereunder the period of limitation can be regarded as being suspended because a party is prevented under certain circumstances from taking action in prusuance of his rights. The limitation Act is a ronsolidating and amending statute relating to . the limitation of suits, appeals and certain types of applications to courts and must, therefore, be regarded as an exhaustive code. It is. a piece of adjective or 'Procedural law and not of substantive law. Rules of procedures, whatever they may be, are to be applied only to matters to which they are made applkable by the legislature e..xpressely or by necessary im¥lication''.

The learned counsel for the responder...t further relics upon another decision of this Court in Sirojul llaq Khan & Othm v. The Sunni Central

Botud of Wok/ U.P. and Other(t>) tnd lays stress on the following paPsage:

"Section 13 provides for 'the exclusion of time during which proceedings are suspended' and it lays down that 'in computing the period of Limitation prescribed for any suit or application for the execution of a decree, the institution or execution of which has been staytd by an injuction or order. the time of the oonti

nuance of the injunction or order, the day on wtJch it was issued

(I) AIR 1936 Oudb 248.

(2) AlR. 1938 Madril! 323.

(3) Aill 1960 Allahabad 572.

(4) AIR 1966 Allahabad 409.

(') [1964]2 S.C.R.. 241/253'4

{6) [1959] S.CR. 1287/1301-1302.

PUM RAJ v. RAM CHAAAN (Goswami, ].) 513

or made and the day on which it was withdrawn, shall be eJ.cluded. It is plain that, for excuding the time under this section, it must be shown that the institution of the suit in question had been stayed by an injunction or order; in other words, the -.ection requires anorderor an injunction which stays the institution of the suit. And so in cases"fa1ling11nder s. 15, the party institu- 'ting the suit would by auch imtitution be in contempt of court".

This Court, however, also observed in the same decision as follows:-

"Whether the requirements of s. IS would be satisfied by the production of an order or an injunction which by neces'.lary implication stays the institution or the suit is open to argument We are however; pt:epared to assume in the present case that s.lS would apply even to cases where the institution of a suit is stayed by necessary implication of the order passed or injunction issued in the previous litigion",

the respondent, as already mentioned, has referred to Bhawanipore Banking Corporation Ltd. v. Gouri Shankat Sharma (supra) and submits that the subsequent suit has no direct or immediate connection with the decree under execution and we will deal with this aspect at the appropriate place, ·

The respondent relies upon a decision of the Bombay High Court in Somshikharswami Shidlingswami v. Shivappa Mallappa Hosmaani

ahd Others(l), which, according to the learned counsel, runs on all fours with the present cae. This was, however,· a case where the High Court . was considering the pleas of sections 1-4 and 1 S of the Limitation Act raised by the decreeholder to save running of time. The High Court held section 15 out of the way as there was no order of stay or injunction in any of the suits filed by the judgment-debtor preventing the . decreeholder from executing his decree. With regard to the plea of section 14(2) of-the Limitation Act, the High Court held that the decree-ho!der was not prosecuting any case but was only defending the same and it was .. difficult to say ...... that the Court was unable to entertain the proceeding form defect of jurisdiction or other cause of a like nature".

Adverting to the unholy type of tenacious litigation of the judgmentdebtor in that case the High Court, being unable to apply the provisions of sections 14 and 15 of the Act, pithily and rather ruefully, observed as follows :-:-

.. It is no doubt unfortunate that the plaintiff finds his remedy thus barred in a matter in which he has been asserting his right to this property for the last ten years and more ...... In a case . ()f. this kind it may be desirable that the plaintiff ought to be in a position the Peduct the time taken up in defending a litigation of the nature such as we have in the present case. But as we arc unable to bring the case within the provisions of the Limi~ . tation Act, the plaintiff's appeal must fail".

(1) AIR 1924 Bombay 39/40-41.

514 SUPllEMB COUllT llBPOUS

£19741 3 S.C.R.

It may at once be pointed out that there is no reference in the above decision to article 182(5) or' the Limitation Act and necessarily 'therr

was no discussion of the provision in favour of the decree-holder who sought to execute the decree. This decision is, therefore, of no avail

to the respodent on the legal aspect with which we are concerned in this appeal. At the best it could be advanced as an implied authority, in the circumstances of that case, for the proposition that a written statement or defence in a suit is not to be treated as an application in aid of execution. But we find an observation of this Court in Madan Ia/ v. Sunder lal aud another, (1) while dealing with section 30 of the Arbitration Act, to the fllowing effect:-

"It may be conceded that there is no special form prescribed for making such an application and in an appropriate case an objection of the type made in this case may be treated as such an application, if it is filed within the. period of limitation" There is no difficulty in holding that in an appropriate case, a written statement defending a particular suit or memorandum of appeal in prosecuting a particular appeal or resisting it may be treated as an application being a 'step in aid of execution' under certain definite and positive circumstances, although no general rule can be laid down in this hehalf.

The respondent also relied upon a decision of the Madras High Court (Full Bench) in (Vadl amannati) Bala Tripura Sunderamma v.

Abdul Khadcr, (2) in which section 15 of the Act was pressed into service and the High Court repelled the plea and also refused to treat the subsequent barred application as one of revival of the old application dismissed for non-payment of batta by the decree-holder. _Article 1 S2(5) did not come up for consideration in that case.

The Madras Full Bi!nch decision (supra) approved of the dec: sion in Satyanarayana Brahmcm v. Serthayya(3) and obscn•ed as follow.>:-

"In regard to the institution of suits, not the e~"\:ecution of de crees, it is held in Satyanarayana Brahmom v. Seetha)')'a(3) that no equitable grounds for the suspension of a cause of action can be added to the provisions ofthe Limitation Act and a decree cancelling a promissory note as fraudulent is no stay of a suit upon the note" (emphasis supplied).

In Muthu Korakkoi Chetty v. Madar Ammal, (4) Sadasiva Ayyar, J .. observed as follows :-

"A person is not bound to bring an unnecessary suit or to make futile and unnecessary applications during the course of other litigation proceedings for the settlement of the same right" .

Sundaram Chctty, J., also observed as follows in the same decision :

(I) [1!:67] (3) S.C.R. 147/151.

(2) AIR 1933 Madras 418/419/421.

(3) AIR 1927 Madras 597.

(4) AIR 1920 Madras 1-43 M1<lras 185 (FJJ.

PREM RAJ v. RAM CHARAN ( Goswami, /.) 515

"It may be contended with. some show of reason that even in the \lbsence of an injunction restraining the sale of the properties in execution of the mortgage decree in O.S. No. 29 of 1918, the declaration of the invalidity of that mortgage would be an obstacle to pursue the execution of the mortgage decree by seeking to sell the mortgaged properties. I am not however dealing with that point'' ·

This, however, does not mean that a rule with statutory force can be laid down by the court superimposing upon the provision of the Limitation Act. The question in the present case, therefore, must rest upon the proper construction of article 1 82(5) without superadding anything to the law and whether the Court will be prepared to &ive a beneficiept construction to the words "step in aid of execution.''

1he respondent's counsel relied upon Govinda Bhatta v. Krishna Bhatta, (I) which, however, cannot come to his aid as will appear from the following extract therefrom ;

"It is, therefore, not possible for us to accept the contention ofthe decree-holde~ that his right to execute the decree had been jn any manner affeqted Jl1UCh less extinguished, by reason of the finding contained in Ext. A-3 judgment".

The respondent also relied upon Raghunandun Parshad and Another

v. Bhuggo Lall (2), dealing w.ith article 179 ofthe old Limitation Act, 1877, corresponding to article 182(S), but the following observation at page 271 would clearly show that the case is distinguishable on facts :

''It is clear .that the decree-holders could, notwithstanding the order in the claim .case, have prosecuted their application for execution against the one-third share which was not released then quite as well as they can do so now. Their present application is for the .sale ofthat third share of the property; there was no bar then to their enforcing the execution of the decree, and there has been no subsequent removal of that bar".

The respondent's •counsel further relied upon Surisetti Ramast{-· hbayya v. Palur Thimmiah and others (l) wherein it was held that the plaint in the declaratory suit under 0 21, r. 63 cannot be treated as an application under article 182(5); nor is it a ''step in aid of execution".

Even in the above case the High Court observed at page 11 as follows:--

"ltmay be conceded that the plaint was filed by the decreeholder with the o pject of getting rid of the finding of the execut .. ing court which was to the effect that the property was not liable to be proceeded against in execution of his decree and that .this may be therefore regarded as il step-in-aid of execution".

(I) AIR 1968 Kerala (FB) 2S0/2S2.

(2) [1890] l.L.R., 17 Culcutta 268/211.

(3) AIR 1942 Madru ·~/ll.

516 SUPllEMB COUitT REPORTS £19741 3 S.C.ll.

The respondent's counsel also referred to Katragadda Ramayyo and another v. Kolli NegaJwaraTao and others (I) which however, was not required to deal with this particular aspect of the matter before us under article 182(5). Even in Na_rayon J; vangouda Patil and another

v. Puttabai and others (2) at page 8 the Judicial Committee, while deal ing with an argument with regard to section 15 of the Limitation Act that the injunction or order to be effective should contain an express prohibition, observed as follows:

" .... it is not necessary to consider that point as their Lord

ships arc satisfied that there is no prohibition; either express or implied in the injunction or the decree in the present case, which restrains the appellant from instituting a suit for possession". (emphasis supplied).

After a survey of the various decisions on the subject, it may perhaps be possible to have two views on this aspect of the matter but it is difficult to overlook tltat certain reservations were made by the Privy Council both in Nagendra Nath Dey's case (supra) as well as in Narayan Jivangouda Pat it's case (supra) for an appropriate occasion to consider whether the "intelligible rule" referred to in the former and the "rule of implication" hinted in the latter may not be pressed into service in favour of the decree-holder in construing certain relevant provisions of the Limitation Act-thus making the way clear for a fair and liberal intepretation of Art. 182 adverted to in several High Courts' decisions. A somewhat apposite decision on the point is available in Joshi Laxmiram Lallubhai and another v. Mehta Bala s!Jankar Veniram, (l) with regard to a 'step in aid of execution' under article 179 of the Limitation Act, 1877 and the successor article 182 of 1908 Act. The Bombay High Court observed therein as "follows .at page 25 :

"We think that it is not putting too great a strain upon ordinary language to say that an appeal in such circumstances fairly falls within the meaning of the words :"an application to take a step-in-aid of execution". It is clear that as long as the insolvenc:y proceedings went in favour of the debtor, the creditor -could not have presented any application in ordinary course for thefurtherexecution of his decree withtheleasthope of success..

Two at least of the High Courts in India had already put so liberal a construction upon the insolvency provisions of the old Civil Procedure Code that an executing creditor must have foreseen that no application for the eJtecution of the decree either by sale of property or arrest of the person of the judgment-debtor could hav~ the least chance of success so long as the judgmentdebtor had been declared an insolvent under .section 351, even although he had not been actually discharged within the meaning of section 357. So that we think that in view of the Court's finding that this judgment-debtor was an insolvent early in

(1) AIR 1969 Andhra Pradesh (FB) .259.

(2) AIR 194S Privy Couocil 5}8.

(3) [191'] I.L.R. , 39 Bombay 20j2S.

PREM RAJ v. RAM CHARAN ( Goswami, }.) 517

1906, the present appellant had no other course open to him than in the first instance to get this bar to the further execution of his decree removed, and the only way in which he could hope to obtain that result would be by first opposing the insolvency petition in the first Court, and if he failed there, by appealing to higher authority' ...

The principle adverted to in the above passage of the Bombay High Court appears to be correct. In that case also, as in the present appeal, there was no controversy about the "proper court" within the meaning of the 2nd explanation to article 182.

Coming now to the facts of the case at hand it is .found that the appellant (decree-holder) was faced with resistance from the respondent judgment debtor and his relations. The appellant, however made abortive attempts to execute the mortgage decree in order to obtain possession of the suit property. Having failed to obtain possession by means of usual civil process, the appellant applied to the court for police aid but the prayer was rejected. Soon after the appellant was dragged to the court by the respondent's son in a suit wherein ooth the appellant and the respondent were parties although the respondent was ex-porte. If the respondent's son had succeeded in the suit the entire foreclosure dcree would have been a scrap of paper for the appellant The appellant therefore found in his front a hurdle which must first be crossed before he could successfully execute his decree in order to obtain possession of the suit house. No doubt his defence was successful in the trial court but the first appellate court partly accepted the appeal of the judgment-debtor's son with reference to half of the share of the suit house and the decree thereafter was no longer the original foreclosure decree which he could execute.

The form of the decree has already been set out above. The decree in the Civil Suit No. 75A of 1957 had thus a direct and immediate connection with and effect upon the decree in suit No 27 A of 1952 sought to be executed. The nexus between the two is manifestly clear. In such circumstances it is obvious that the appellant's successive ecphractic action in defending the foreclosure decree in different ways in the course of the lengthy litigation until its final determination in the High Court are all steps in aid of execution of his foreclosure decree.

These steps .to remove the impediment in executing the foreclosure decree were absolutely incumbent upon the appellant to take the nex:t move in furtherance of the execution of the foreclosure decree to facilitate the same. These being therefore, necessarily "steps in aid of execution" of the foreclosure decree, the appellant's fifth execution application was within time, being within three years from the date of the final order in the High Court on January 1, 1962.

It should also be remembered that there was a perpetual injunction restraining the appellant from executing the foreclosure decree in Prakash Chander's appeal No. 37A/59 during the period from 31- 12-1958 to 21-10-1959. Thereafter when the appeal was partly allowed

:518

[ 1974] 3 S.C.R.

th-; perpetual injunction was directed in the decree against half of the suit-hollse. In other w<>rds in the injunction against the decree in suit NJ. 27Af52 was neve~ raised fully at any time.

It is clear that the original foreclosure decree in the form it was, was not capable of execution and the appellant's all attempts in the series of litigation were to restore the said decree to its original form for proper and effective enforcement of the same. The appellant c1rried this rae::: upto the High Court and having finally stopped there, turned to execute whatever is now left for enforcement.

Although not directly on th::: point, the Privy Council in , Maharaja :Sir Rameslzvar Singh Bahadur v. Homeshvar Singh(l) whiledealing with articles 181 and 182 of the Limitation Act 1908 laid down a kind of pragm1tic principle in the following words :-

They (the Privy Council) are of opinion that, in order to make the provision of th' Limitation Act apply, the decree sought to b~ enforced must have been in such a form as to render it capable in the circurn5tances of being enforced. A decree so limited in its scop~ as that ofthe 27th July, 1906, under consideration cannot in th::ir opinion be regarded as being thus capable of execution". ·

In th' view thus taken in this app!al it is not necessary to decide

whther article I 82(4) could be invoked in this case on the basis of an implied amndm:nt of the foreclosure decree as a necessary conse- <quen::e of decree in the subsequent suit.

It is also not necessary in this appal to deal with the alternative submission .

A .

~ t

L..

of the app!llant \vith regard to the theory of revival of his execu- E , ctio:t case earlier consigned to the records in 1956. >-

In th! result the a"pp.!al is allow.!d and the judgment of the High

Co:rt is set aside but in th~ entire circumstances of the case the parties

will b!ar their own costs in this Court.

S.C. ,-4ppeal allowed

\.-_-·;

(l} tl9ll) -40 Ma:Iras L'lw 1ournal1/6 .

94

PREMRAJ

RAM CHARAN

P. JAGANMOHAN REDDY

S. N. DWIVEDI

P. K. GoSWAMI, JJ.

Limitation Act 1908

S. 182

Prakash Chandra

June 23, 1956

July 28, 1964

Art. 182

cl. 5

Art. 182

Art. 182

Cl. 5

Art. 182

Art. 182

DIJselftinz Ptr Goswami

January 1, 1962

CIVIL APPELLATE JURlSDICf!ON

CIVIL APPELLATE JURlSDICf!ON : Civil Appzal No.

B. D. Sharma

B. N. Lokur

B. N. Lokur and A. G. Ratnaparkhi for the respondent.

A. G. Ratnaparkhi

P. JAGANMOHAN Rmov

The udgment of P. JAGANMOHAN Rmov AND S. N. DWivEDr, JJ.

S. N. DWivEDr

DwrVEDI

w~ _deltvered by DwrVEDI, J. P. K. GoswAMI, J. gave a dissenting Opmton.

P. K. GoswAMI

J.-Kariya

K1riya died in 1936 leaving behind him Sava and Ram Charan, his son.

Ram Charan

On August 16, 1951 Ram Charan mortgaged the house to Prem Raj (the appellant).

Prem Raj

Sava

Ram Charan

Prakash .Chandra

April 25, 1956

He made the fourth attempt on April 25, 1956 .. Shortly.

Ram .· Cbaran

NoYernber 25, 1958

The suit was dismissed on NoYernber 25, 1958.

December 31, 1958

He filed an appeal and obtained an order staying execution of the decree on December 31, 1958.

October 21, 1959

The appeal court partly allowed his appeal on October 21, 1959.

H1p

Court of Madhya Pradesh

JanWlry I, 1962

Both the appeal and the cross-objection were dismissed by the High Court on JanWlry I, 1962 .

June 23, 1Q56

July 29, 1964

High Court of Madhya Pradesh

however, upheld by the High Court of Madhya Pradesh.

Limitation Act, 1908

January. 31, 1958

s. 15

cl. 5

Art. 182

l'REM RAJ V

RAM CHARAN

cl. 1

Art. 182

Prakash Chan

Prakash Chlndra

Prakash Chlndra obtained his decree in a collateral suit.

cl. 2

Art. 182

clause 4

Art. 182

cl. 5

Art. 182

Art. 182

Calcutta

Madras High Courts

Prakah Chandra

To oppose Prakah Chandra's suit, the appel~ lllllt had filed a written statement .

cl. 5

Art. 182

Order- VIII Code

Code of Civil Procedure

cl. 5

Art. 182

Code of Civil Procedure

cl. 5

Punjab High Court

A.I.R. 1967 Punjab 375

Art. 182

cl. 5

Art. 182

Art. 182

Civil Procedure Code

s. 187

the Code of Civil Procedure

Art. 182

Prakash Chtndra

Civil Judge, Class II, Balaghat

pused by the Civil Judge, Class II, Balaghat.

First Additional Civil Judge, Balagbat

First Additional Civil Judge, Balaghat

Prabsh Chandra

cl. 5

Art. 182

Allahabad and Bombay High Court£

Baldeo Singlt

Baldeo Singh

made by Baldeo Singh, who was the assignee of .

July 15, 1916

Ram Swarup

Jai Dayal

BaJdeo Singh

March 19, 1918

The appeal court allowed the appeal and dismissed the suit on March 19, 1918.

18th of July 1917

19th March, 1918

Art. 182

Laxmiram Lallubhai

In Laxmiram Lallubhai (supra) the judgment-debtor applied to have himself declared an insolvent.

Limitation Act

Art. 179

Limitation Act, 1877

Art. 182

Limitation Act, 1908

Beamon

Art. 179

Art. 182

Limitation Act

PREM RAJ V. RAM CHARAN

Article 179

Article 182

cl. 5

Art. 182

Limitation Act

Madras High Court

lAxmiram Lalubhai

Art. 182

A11na malai(supra

Annamalai

Both these cases relied on the decision of the Privy Council in Annamalai (supra).

November 28, 19S6

June 23, 19S6

fuly 28, 1964

November 28, 1956.~

Chennappa Goundan.(6

Kansbi Ram

One Kansbi Ram filed an objection that he had a lien on it.

PREM RAJ V. P.AM CHAllA~

Code of Civil Procedure

Kanshi Ram

while Kanshi Ram preferred an appeal to the High Court.

Lahore High Court

Code of Civil Procedure

Madtas High Court

Art. 182

GoswAMI

article 182

Limitation Act, 1908

Kariya

n Sava

Prem Raj

16th

Jul~ 1953

Sava

Praka

in favour of Praka:; h Chandra, son of Ram Charan, the respondent.

December 7, 1956

25th November, 1958

This suit was dismissed on 25th November, 1958.

31st Dec-ember, 1958

First Additional District Judge, Chhindwara

25th Novernber, 1958

Prakash

Chandra

Prakash

Ram Charan Gadhewal

article 182

Limitation Act, 1908

Madhya Pradesh High Court

Additional District Judge, Balaghat

2nd March 1967

Lokur

section 15

Limitation Act

Sharma

article 182(2)

article 182(5)

article 182(5)

28th July, 1964

25th April, 1956

article 182(5)

Limitation Act

art. 133

Code of Civil Procedure, 1908

article 182(5)

article 182(2)

India

article 182(5)

Limitation Act

High Court of Madras

Limitation Act

article 182(2)

clause 2

article 182

section 36

article 182

order 9 rule 9

Prakash Chandrawhich

article 182(5)

Limitation Act

article 182(~)

Limitation Act

section 15

Limitation Act

A. S. Krishnappa Chettiar

limitation Act

Section 13

s. 15

Bombay High Court

sections 1

Limitation Act

section 15

section 14(2)

Limitation Act

sections 14 and 15

article 182(5)

Limitation Act

section 30

section 15

Article 1

Madras

Limitation Act

Sadasiva Ayyar

Sundaram Chctty

AIR 1933 Madras

AIR 1927 Madras 597

Limitation Act

article 1

article 179

Limitation Act, 1877

article 182(S)

article 182(5)

article 182(5)

section 15

Limitation Act

Nagendra Nath Dey

Narayan Jivangouda Pat

Limitation Act

Art. 182

article 179

Limitation Act, 1877

article 182

section 351

section 357

article 182

Prakash Chander

31- 12-1958

articles 181 and 182

Limitation Act 1908

Limitation Act


INDERJIT C. PAREKH & ORS •

V. K. BHATI & ANR.

January, 8, 1974

[M. H. BEG AND Y. V. CHANDRACHUD, JJ.]

Bombay Relief Undutaklnir (Special Provis/om) Ad 1958-S. 4 (I) (•) (iv)- Whether personal liability of directors falls within the scope of stlon.

The appellants, five of whom were directors and one an officer of a company, were prosecuted under the Employees Provident Funds Act, 1952 on the grouod that they had failed to pay the contribution to the Provident Fund and thereby committed an offence punishable under paragraph 76(a) of the Employ..S Provident Fund Scheme, 1952. Later, an investigation was made into the affairs of the company under s. I 5 of the lodustries (Devefopment aod Regulation) Act, 1951 aod an order was issued authorisina the Gujarat State Textile Corporation to take over the management of the company. By a notification the State Government declared the company to be a"'rclief undertaking" unde< s. 4 (I) (a) (iv) of the Bombay Relief Undertaking.'! (Special Provisions) Act, 1958 and directed that "'all rights, privileges, obligations and liabilities a<orued or in<umd before the undertaking .... declared a relief undertaking aad any remedy for the enforcement thereto shall be suspended and all the procutli'ngs relevant tMreto pending before any court, tribunal. officer or authority shall be. stayed" with effect from a certain date.

An application filed by the appellants for stay of the prosecution in view of the noti ti.cation issl.led by the Government was rejected by the lower court on the' view that the operation of s. 4 of the 1958 Act was restricted to the statutes mentioned in the Schedule to thkt Act and that clause (iv) of s. 4 (I} (a) did not contemplate stay of criminal proceedings. On appeal the High Court summarily rejected the revision application. The appellants came in appeal to this Cou~ by special leave.

On the question whether the proaecution pending against the appellants under paragraph 76 (a) of the Employees Provident Funds Scheme 1952 is liable to be stayed. by virtue of the notification issued by the State Government.

Ding the, appeal,

HELD : The personal liability of the directors and officers does not fall within the scope of s. 4 (1) (a) (iv) of the Act. The responsibility to pay the contnbution to the Fund was of the appellants and if they had defaulted in paying the amount they were liable to be prosecuted under paragraph 76 (a) of the Scheme. The phrase "'all proceedings relative thereto" patently means all proceedings relating to "an) f right, privilege, obligation or liability accrued or incurred before the undertaking was declared a relief undertaking". Sub-clause (iv) concerns itself with the pre existing obligations and liabilities of the .undertaking and not of its directors. managers or other officers. Neither the language of the statute nor its object would justify the extension of the immunity so as to cover the individual obligations and liabilities of the directors and other officers of the undertaking. If they had in curred such obligation or liabilities as distinct from the obligations or liabilities of the undertakingthey were liable to be proceeded against for their personal acts of commission and ommission. The remedy in that behalf cannot be suspended G nor can a proceeding already commenced against them in their individual capacity be stayed. [52E; 53EJ

The occasion for declaring an. industry as a "relief undertaking" would arise out of causes connected with the defaults on the part of its directors and other officers.

To declare a moratorium on legal actions against persons whose activities . have nece3sitated the issuanc; of a notifi:ation in the interest of unemployment relief is to give such persons the benefit of their own wrong. Section 4 (1) (a) (iv) H advisedly limits the pOwer of the State Government to direct suspension of all rem, dies and stay of proceed.jogs involving the obligations and liabilities in relation to a relief undertaking and which were incurred before the undertaking was declared a relief undertaking. [53FJ

CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No. 57 of 1973.

Appeal by special leave from the judgment and order dated the 9th February 1973 of the Gujarat High Court at Ahmedabad in Criminal Revision Application No. 86 of 1973.

Y. S. Chitaley and S. K. Dholakia, for the appellants.

G. Das, S. N. Anand and M. N. Shroff. for the respondent.

The Judgment of the Court was delivered by

CHANDRACHUD, J.-Appellants I, 2, 4, 5 and 6 are the directors of Rajnagar Spinning and Weaving Manufacturing Co. Ltd., Ahmedabad, and appellant No. 3 is an office< of the said company. On March 19, 1969 a complaint was lodged against them by respondent l, an Inspector appointed under the Employees' Provident Funds Act, 1952 that they had failed to pay a sum of Rs. 1,39,419 50 being the contribution to the Provident Fund for the months of June, July and August, 1968 and that thereby they had contravened the provisions of Paragraph 38(1) of the Employees' Provident Funds Scheme, 1952. an act punishable under Paragraph 76(a) of the Scheme.

An investigation was made into the affairs of the company under section 15 of the Industries (Development and Regulation) Act, 1951 and on being satisfied that lobe company was managed in a manner highly detrimental to public interest, the Government of India issued an order dated January 7, 1972 authorising the Gujarat State Textile Corporation to take over the management of the company. On May 6, 1972 the Gujarat Government issued a notification declaring the company to be a "relief undertaking"· under section 4(1XaXiv) of the Bombay Relief Undertakings (Special Provisions) Act, 1958 ('the Act'), and directing that "all rights, privileges, obligations and liabilities accrued or incurred before the undertaking was declared a relief undertaking and any remedy for the enforcement thereof shall be suspended and all the proceedings relative thereto pending before any Court, tribunal, officer or authority shall be stayed with effect from 6th May 1972" ..••••

The appellants filed one application after another asking the court which was seized of the matter to stay the prosecution in view of the notification issued by the Government of Gujarat. Two of such applications were rejected by the learned City Magistrate, III Court, Ahmedabad. Appellants acquiesced in one of the orders, carried the other in revision to the High Court but withdrew that proceeding. On October 27, 1972 they made yet another application for the same relief which also was rejected by the learned.Magistrate. He took the view, as in the two earlier applications, that the operation of section 4 of the Act is restricted to the statutes mentioned in the Schedule to that Act and that clause (iv) of section 4(1) did not contemplate stay of criminal proceedings. The High Court of Gujarat rejected summarily the revision appli- :ation filed by the appellants against the judgment of the learned Magistrate. This appeal by special leave is directed against the judgment of the High Court.

SUPREME COURT REPORTS

[197413 S.C.R.

We are concerned in this appeal with the narrow question whether the prosecution pending against the appellants under Paragraph 76(a) of the Employees' Provident Funds Scheme, 1952 is liable to be stayed by virtue of the notification issued by the Government of Gujarat on May 6, 1972. That notification was issued 1n exerdse of the power conferred by section 4(l)(a)(iv) of the Act, which reads thus :

"4. (I) Notwithstanding any law, usage, custom, contract, instrument, decree, order, award, submission, settlement, standing order or other provision whatsoever, the State Government may, by notification in the official Gazette, direct that-

( a) in relation to any relief undertaking and in respect of the period for which the relief undertaking continues as such under sulrsection (2) of section 3-

• • * • •

(iv) any right, privilege, obligation or liability accrued or in curred before the undertaking was declared a relief under taking and any remedy for the enforcement thereof shall be suspended and all proceedings relative thereto pending before any court, tribunal, officer or authority shall be stayed;"

"all proceedings relative thereto" patently meam all proceedings relating to "any right, privilege, obligation or liability accrued or incurr<d before the undertaking was declared a relief undertaking".

The obligation or liability which sub-clause (iv) speaks of is an obligation or liability incurred by the undertaking before it was declaretl a relief undertaking. Jn other words sub-clause (iv) concerns itself with the pre-existing obligations and liabilities 6f the undertaking and not of its directors, managers or other officers.

The obligation or liability of these persons is not comprehended within the words of sub-clause (iv). Clause (a) of section 4(1) shows that the power of the State Government is itself restricted to giving directions referred tQ in sub-clause (iv). "in relation to any relief undertaking". Obligations and liabilities of the directors or other officers of the undertaking are not in a true sense obligations and liabilities in relation to the relief undertaking. In plain and simple language they are the obligations and liabilities of such persons themselV<s. Their obligations and liabilities have to be viewed from a different angle than the obligations and liabilities of the company itself which only acts impersonally.

The object of section 4(I)(a)(iv) is to declare, so to say, a moratorium on actions against the undertaking during the currency of the notification declaring it to be a relief undertaking. By sub-clause (iv), any remedy for the enforcement of an obligation or liability against the relief undertaking is suspended and proceedings which arc already commenced are to be stayed during the operation of the notification.

Under section 4(b), on the notification ceasing to have force, such obligations and liabilities revive and become enforceable and the proceedings which are stayed can be continued. These provisions are

aimed at resurrecting and rehabilitating industrial undertakings brought by inefficiency or mis-management to the brink of dissolution, posing thereby the grave threat of unemployment of industrial workers. 'Relief undertaking' means under section 2(2) an industrial undertaking in respect of which a declaration under section 3 is in force. By section 3, power is conferred on the State Government to declare an industrial undertaking as a relief undertaking, "as a measure of preventing unemployment or of unemployment relief'. Relief undertakings, so long a~ they continue as such, are given immunity from legal actions s0 as to render their working smooth and effective. Such undertakings can be run more effectively as a measure of unemployment relief, if the conduct of their affairs is unhampered by legal proceedings or the threat of such proceedings. That is the genesis and justification of section 4(l)(a)(iv) of the Act.

Thus neither the language of the statute nor its object would justify the extension of the immunity so as to cover the individual obligations and liabilities of the director and other officers of the undertaking.

If they have incurred such obligations o.r liabilities, as distinct from the obligations or liabilities of the undertaking, they are liable to be proceeded against for their personal acts of commission and omission.

The remedy in that behalf cannot be suspended nor can a proceeding already commenced agajnst them in their individual capacity be stayed.

Indeed, it would be strange if any such thing was within the contemplation of law. Normally, the occasion for declaring an industry as a relief undertaking would arise. out of causes connected with defaults on the part of its directors and other officers. To declare a moratorium on legal actions against persons whose activities have necessitated the issuance of a notification in the interest of unemployment relief is to give to such persons the benefit of their own wrong. Section 4(l)(a)(iv) therefore advisedly limits the power of the State Government to direct suspension of remedies and stay of proceedings involving the obligations and liabilities in relation to a relief undertaking and which were incurred before the undertaking was declared a relief undertaking.

Paragraph 38(1) of the Employees' Provident Funds Scheme, 1952 imposes an obligation on 'The employer' to pay the Provident Fund ; contribution to the Fund within 15 days of the close of every month.

The Scheme does not define 'Employer' but Paragraph 2(m) says that words and expressions which are not defined by the Scheme shall have H the meaning assigned to them in the Employees' Provident Funds Act.

Section Z(e)(ii) of that Act defines an 'Employer', to the extent material, as the person who, or the authority which, has the ultimate contro'.

54 SUPREMj! COURT REPORTS [ 1974 l 3 s.C.L

over the affairs of an establishment and where the said affairs are entrusted to a manager, managing director or rnaru1ging agent, suclt manager, managing director or managing agent. Thus the responsibility to pay the contributions to the Fund was of the appellants and if they have defaulted in paying the amount, they are liable to be prosecuted under Paragraph 76(a) of the Scheme which says that if any person fails tl> pay any contribution which he is liable to pay under the Scheme, he shall be punishable with six months' imprisonment or with fine which may extend to one thousand rupees or with both. Such a personal liability does not fall within the scope of section 4(1)(a)(iv) of the Act.

We therefore dismiss the appeal and direct that the prosecution shall proceed expeditiously.

P.B.R.

Appeal dismissed.

INDERJIT C. PAREKH & ORS

V. K. BHATI & ANR

January, 8, 1974

M. H. BEG

Y. V. CHANDRACHUD, JJ.

S. 4

Employees Provident Funds Act, 1952

Gujarat State Textile Corporation

s. 4

s. 4

s. 4

s. 4

Section 4

Y. S. Chitaley

S. K. Dholakia

G. Das

S. N. Anand

M. N. Shroff

CHANDRACHUD

Ahmedabad

Provident Funds Act, 1952

section 15

Government of India

January 7, 1972

6, 1972

Gujarat Government

section 4(1XaXiv)

6th May 1972

Government of Gujarat

October 27, 1972

section 4

section 4(1)

High Court of Gujarat

section 4(l)(a)(iv)

section 3

section 4(1)

section 4(I)(a)(iv)

section 4(b)

section 2(2)

section 3

section 3

section 4(l)(a)(iv)

Section 4(l)(a)(iv)

Provident Funds Act

section 4(1)(a)(iv)