1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.7353 OF 2009 Parnakuti Co-operative Housing Society Ltd .. Petitioner versus Smt.Rewati @ Laxmi Pralhad Gawade and others .. Respondents Mr.S.S.Kulkarni for Petitioner. Mr.J.D.Khairnar for respondent Nos.1 to 4 and 6. CORAM : A.S.OKA, J. DATE : 24th February 2010 JUDGMENT : . By this writ Petition under Article 227 of the Constitution of India, the petitioner who is the original defendant-judgment debtor has challenged an order passed by the executing Court by which the objections raised by the petitioner to the execution of the decree at the instance of the respondents have been rejected. There is also a challenge to the judgment and order of the District Court by which the order of the executing Court has been confirmed. 2. One Bhau Gawade was the original plaintiff-decree holder. A suit for possession filed by him against the petitioner was decreed on 14th June 1963. He filed an application for execution in the year 1969. During the pendency of the said application, on 19th March 1969 the said original 2 plaintiff sold the suit property to Mr. Peter Bhosale and Mr.Paul Alwares. Thereafter, on 13th March 1970, the original plaintiff was permitted to withdraw the execution application. In the same execution application, the aforesaid purchasers filed an application praying for deleting the name of the original decree holder and for substituting their names in his place. On the said application notice was issued. Thereafter, on 30th August 1972, the respondents who are the legal representatives of the deceased original plaintiff filed an application for execution of the same decree. In the said execution application, the petitioner filed an objection by contending that the respondents have no locus to file execution application. The said objection was rejected. Appeal preferred against the said order was dismissed on the ground that the same was not maintainable. One of the purchasers from the original plaintiff sold the suit property to third parties on 23rd February 1989. 3. On the 1st April 2008, the petitioner filed an application at Exhibit 127 raising an objection to the locus of the respondents to prosecute the execution application by contending that as the respondents had no title to the suit property, the execution application amounts to abuse of process of law. Another application was filed by the petitioner at Exhibit 135. In the said application it was prayed that a preliminary issue about the maintainability of the execution application be framed. The executing court passed an order on 9th July 2008 by which a preliminary issue on the locus of the respondents was framed . By judgment and order dated 4th October 2008, the executing Court rejected the applications at Exhibit 127 3 and Exhibit 135. The preliminary issues where answered in favour of the respondents. An appeal was preferred by the petitioners which has been dismissed. 4. The learned counsel appearing for the petitioner submitted that the original plaintiff- decree holder sold the suit property by a registered sale deed in favour of Mr. Peter Bhosale and Mr. Paul Alwares. He submitted that by the sale deed the decree was assigned by the original plaintiff to the said purchasers. He pointed out that one of the said purchasers executed a sale deed on 23rd February 1989 in respect of his one half share in favour of third parties. He submitted that the respondents who are the legal representatives of the original plaintiff have no title to the suit property and they are not entitled to prosecute execution application when the deceased had already assigned the decree in favour of purchasers. He relied upon a decision of the Apex Court in the case Dhani Ram Gupta and others versus Lala Shriram and another ((1980) 2 Supreme Court Cases 162). Relying upon the observations made in the said decision he submitted that what follows from the said decision is that once there is an assignment of decree, the decree holder has no locus. He submitted that rejection of earlier objection will not come in the way of the petitioner in view of rule 16 of Order XXI of the Code of Civil Procedure 1908 (hereinafter referred to as “the said Code”). He submitted that the courts below have not correctly appreciated the ratio of the decision of the Apex Court in the case of Dhani Ram(supra). He submitted that the decision of this Court in the case of Bajirao and another versus Kashirao (AIR 1978 4 Bombay 350) has not been correctly read by the Courts below. He, therefore, submitted that the objections raised by the petitioner ought to have been accepted and the execution application should have been dismissed. The learned counsel appearing for the respondents supported the impugned judgment and order. 5. In the registered sale deed dated 19 th March 1969 executed by the original plaintiff in favour of the purchasers, there is a reference to pending execution application. Clause 6 of the sale deed authorises the purchasers either to continue the execution application in the name of the original plaintiff or to prosecute the same in their names. At this stage it will be necessary to consider rule 16 of Order XXI of the said Code. The said rule reads thus: “16. Application for execution by transferee of decree.— Where a decree or, if a decree has been passed jointly in favour of two or more persons, the interest of any decree-holder in the decree is transferred by assignment in writing or by operation of law, the transferee may apply for execution of the decree to the Court which passed it; and the decree may be executed in the same manner and subject to the same conditions as if the applic- ation were made by such holder: Provided that, where the decree, or such interest as aforesaid, has been transferred by assignment, notice of such application shall be given to the transferor and the judgment-debtor, and the decree shall not be executed until the Court has heard their ob- jections (if any) to its execution: Provided also that, where a decree for the payment of money against two or more persons has been transferred to one of them, it shall not be executed against the others. 1[Explanation.—Nothing in this rule shall affect the provisions of Section 146, and a transferee of rights in the property, which is the subject-matter of the suit, may apply for execution of the de- cree without a separate assignment of the decree as required by this rule.]” 5 On plain reading of rule 16, it appears that it is an enabling provision. It enables the transferee of a decree either by assignment in writing or by operation of law to make an application for execution of the decree operating in favour of the transferor -decree holder. Rule 16 deals with rights of the transferee of the decree either by way of assignment in writing or by operation of law to execute a decree. 6. Reliance has been placed on the decision of the Apex Court in the case of Dhani Ram (supra). The paragraph 4 of the said decision reads thus: “4. We are unable to read Order 21, Rule 16 as furnishing any foundation for the basic assumption of the learned Counsel for the respondent that property in a decree does not pass to the transferee under the assignment until the transfer is recognised by the court. Property in a decree must pass to the transferee under a deed of assignment when the parties to the deed of as- signment intend such property to pass. It does not depend on the court’s recognition of the transfer. Order 21 Rule 16 neither ex- pressly nor by implication provides that assignment of a decree does not take effect until recognised by the court. It is true that while Order 21 Rule 16 enables a transferee to apply for execu- tion of the decree, the first proviso to Order 21 Rule 16 enjoins that notice of such application shall be given to the transferor and the judgment-debtor and that the decree shall not be ex- ecuted until the court has heard their objections, if any, to its exe- cution. It is one thing to say that the decree may not be executed by the transferee until the objections of the transferor and the judgment-debtor are heard, it is an altogether different thing to say that the assignment is of no consequence until the objec- tions are heard and decided. The transfer as between the origin- al decree-holder and the transferee is effected by the deed of as- signment. If the judgment-debtor has notice of the transfer, he cannot be permitted to defeat the rights of the transferee by en- tering into an adjustment with the transferor. If the judgment- debtor has no notice of the transfer and enters into an adjust- ment with the transferor before the transferee serves him with notice under Order 21 Rule 16 the judgment-debtor is protected. 6 This in our view is no more than plain good sense. In Dwar Buk- sh Sirkar v. Fatik Jali, the decree-holder represented to the Court that the judgment-debtor had satisfied the decree by payment and wanted his execution application to be disposed of accord- ingly. Before satisfaction could be recorded a transferee of the decree from the original decree-holder intervened and claimed that satisfaction could not be recorded as there was a valid transfer of the decree in his favour prior to the alleged payment by the judgment-debtor to the original decree holder. The argu- ment before the High Court was that the assignee could not pre- vent the recording of the satisfaction of the decree as he had not filed an execution application and got the assignment in his fa- vour recognised. The High Court of Calcutta observed: “The only provision in the Code referring expressly to the assign- ment of a decree is contained in Section 232, and that no doubt contemplates a case in which the assignee applies for execution. In such a case the court may, if it thinks fit, after notice to the de- cree-holder and the judgment-debtor, allow the decree to be ex- ecuted by the assignee. If, however, there is an assignment pending proceedings in execution taken by the decree-holder, I see nothing in the Code which debars the Code from recognising the transferee as the person to go on with the execution. The re- cognition of the court is no doubt necessary before he can ex- ecute the decree, but it is the written assignment and not the re- cognition which makes him the transferee in law. The omission of the transferee, if it was an omission, to make a formal application for execution, was merely an error of procedure and does not af- fect the merits of the case.... It is argued for the respondent that the transferee’s title was not complete as express notice of the transfer had not been given to the judgment-debtor. As already observed, the transfer, as between transferor and the transferee, is effected by the written assignment. If the judgment-debtor had no notice of the transfer and being otherwise unaware of it paid the money to the decree-holder, the payment was, of course, a good payment, and he cannot again be held liable to the trans- feree.” We express our agreement with the observations made by the Calcutta High Court.” In the case of Bajirao(supra), this Court observed that under sub-section 3 of section 2 of the said Code, the "decree holder" has been defined to mean any person in whose favour the decree has been passed. Thereafter this Court proceeded to consider the scope of rule 16 of Order 7 XXI of the said Code . In paragraph 11, after referring to rule 16 of Order XXI, this Court held thus : “This would go to show that the transferee has an option to apply for execution. The use of the verb may indicate that a decree- holder can continue to execute this decree notwithstanding the assignment as long as his name continues to appear as a person in whose favour a decree is passed. In other words, therefore, the transferor’s right to execute the decree is not taken away as long as the transferee is not recognised and accepted by the Court. Where the person is recognised under O.21, R.16 and transferee is substituted in place of the transferor, from that point of time the transferor ceases to have any interest or title as decree-holder. Similarly notwithstanding the assignment the assignee is not bound to execute the decree.” In the case of Dhani Ram (supra) the Apex Court observed that the assignment takes place when the parties to the deed of assignment intend such property to pass and it does not depend on the recognition by the Court. The Apex Court observed that Rule 16 of Order XXI enables a transferee to apply for execution of the decree and in view of the proviso to Rule 16 ,the decree will not be executed until the objections of transferor and the judgment debtor are heard. If an application for execution is filed by a transferee, in view of the first proviso to rule 16, a notice will have to be issued of such application to the transferor and the judgment debtor. The decree cannot be executed by the transferee unless the objections of the transferor are heard. If the transferor raises an objection and the same is overruled or if the transferor fails to raise any objection, thereafter, the transferor cannot execute the decree. 7. In the present case, the transferees never applied for execution of 8 the decree. An attempt was made on 10th June 1970 by them by making an application praying for substitution of their names in place of the original decree holder. However the said application was made after the execution application filed by the original plaintiff- decree holder was withdrawn. Thereafter, the present respondents who are the legal representatives of the original decree holder filed a fresh execution application. By filing a reply to the execution application, the petitioner the contended that the respondents have no locus to execute the decree. The said objection was rejected by the executing Court. Therefore, in the facts of the case, the transferees never applied for execution of the decree. There is nothing in the provisions of the said Code which prevents a decree holder from executing the decree after making an assignment. The prohibition will apply when transferee the makes an application for execution and when the procedure contemplated by first proviso to Rule 16 of Order XXI is followed. The transferor /decree-holder loses his right only if he fails to file objection to the execution application filed by the transferee or if he files an objection and the same is overruled. 8. Hence, there is no merit in the petition filed by the judgment debtor. The decree passed in the year 1963 is not yet executed. Hence, execution application must be expedited. Petition is rejected. The executing Court will dispose of the execution application within a period of six months from today. (A.S.OKA, J) 9 9. After the judgment is pronounced, the learned counsel appearing for the petitioner prays for continuation of the ad-interim relief. The request is opposed by the learned counsel appearing for the respondent. 10. Ad-interim relief granted on 28th August 2009 will continue to operate for a period of six weeks from today. (A.S.OKA, J)