Case: Lalji Raja &amp; Sons Vs. Firm Hansraj Nathuram

This case has a long and chequered history. The decree-holders obtained a decree against the respondents in the Court of Sub-Judge, Bankura (West Bengal) for a sum of over Rs. 12,000/-, on December 3, 1949. On March 28, 1950 they applied to the Court which passed the decree to transfer the decree together with a certificate of non-satisfaction to the Court at Morena in the then State of Madhya Bharat for execution. It was ordered accordingly. The execution proceedings commenced in the Court of Additional District Judge at Morena on September 21, 1950 (Money Execution Case No. 8 of 1950). The judgment-debtors resisted the execution on the ground that the Court had no jurisdiction to execute the same as the decree was that of a foreign Court and that the same had been passed ex parte. The Court accepted that contention and dismissed the execution petition on December 29, 1950. On April 1, 1951 the Code of Civil Procedure (Amendment) Act, (Act II of 1951) came into force. As a result of that the Code of Civil Procedure (in short the Code) was extended to the former State of Madhya Bharat as well as to various other places. Meanwhile the decree-holders appealed against the order of the learned Additional District Judge, Morena dismissing the execution petition, to the High Court of Madhya Pradesh. The Madhya Pradesh High Court allowed their appeal. As against that the judgment-debtors appealed to this Court. This Court allowed the appeal of the judgment debtors and restored the order of the learned Additional District Judge, Morena. The decision of this Court is reported in Hansraj Nathu Ram v. Lalji Raja and Sons of Bankura, (1963) 2 SCR 619   = (AIR 1963 SC 1180  ). Therein this Court ruled that the transfer ordered by the Bankura Court was without jurisdiction as on that date the Code did not apply to the Morena Court. This Court held that Morena Court not being a Court to which the Code applied, the decree could not have been transferred to it. It further held that Sections 38 and 39 of the Code did not afford justification for such a transfer. It may be noted that at the time the Bankura Court ordered the transfer of the decree, the Morena Court was governed by the Indian Code of Civil Procedure as adapted by the Madhya Bharat Adaptation Order, 1948. In other words it was governed by a law passed by the then Madhya Bharat State. In the course of its judgment this Court observed that under the Code "a decree can be executed by a Court which passed the decree or to which it was transferred for execution and the decree which could be transferred has to be a decree passed under the Code and the Court to which it could be transferred has to be a Court which was governed by the Indian Code of Civil Procedure". The first stage of the execution proceedings came to an end by the decision of this Court rendered on April 30, 1962.2. On February 15, l963, the decree-holders filed another execution case before the Bankura Court. Therein they prayed for the transfer of the decree again to the Morena Court for execution. As noticed earlier, by that time the Code had been extended to the Madhya Bharat State which later became a part of the State of Madhya Pradesh. The Bankura Court again ordered the transfer of the decree to the Morena Court. The execution proceedings were started afresh in the Morena Court on August 31, 1963 (Execution Case No. 1 of 1963). The judgment-debtors resisted the execution on various grounds viz, (a) that it is barred by res judicata in view of the decision of this Court referred to earlier. (b) that it is barred by Section 48 of the Code; (c) that it is barred by limitation and (d) that the decree is not executable as it is a decree of a foreign Court.3. The learned Additional District Judge rejected the objections raised by the judgment-debtors. The judgment-debtor, appeals against that order to the High Court of Madhya Pradesh. The High Court agreed with the executing Court that the execution petition is neither barred by res judicata nor by Section 48 of the Code, nor is there any bar of limitation but it disagreed with that Court and held that the decree was not executable as the Court which passed the decree was a foreign Court. In arriving at that conclusion it purported to rely on the decision of this Court in Raj Rajendra Sardar Moloji Narsingh Rao Shitole v Sri Shankar Saran, (1963) 2 SCR 577   = (AIR 1962 SC 1737  ). Aggrieved by that decision, the decree-holders have brought this appeal by special leave.

Court's reasoning:
We are unable to accede to this contention. As mentioned earlier, the judgment-debtors were served with the notice of the suit. They did not choose to appear before the Court. Hence there is no basis for the contention that any principle of natural justice had been contravened. Further as held earlier the judgment question is not a foreignmay be more appropriate to say that the decree in question is not executable in Courts outside this country. The board itself had noticed that this rule of Private International Law is subject to special local legislation. Clause (c) of Section 20 of the Code provided at the relevant time and still provides that subject to the limitations mentioned in the earlier sections of the Code, a suit can be instituted in a Court within the local limits of whose jurisdiction the cause of action, wholly or in part, arises. There is no dispute in this case that the cause of action for the suit which led up to the decree under execution arose within the jurisdiction of Bankura Court. Hence it must be held that the suit in question was a properly instituted suit. From that it follows that the decree in question is a valid decree though it might not have been executable at one stage in Courts in the former Indianwas admittedly a foreign court for the purpose of any proceedings under the Code. The ratio of that decision is wholly inapplicable to the present case. The question whether a decree is a foreign decree or whether it can be transferred to another court for execution has to be judged by the provisions of the Code.This provision undoubtedly protects the rights acquired and privileges accrued under the law repealed by the amending Act. Therefore the question for decision is whether the non-executability of the decree in the Morena court under the law in force in Madhya Bharat before the extension of the Code can be said to be a right accrued under the repealed law. We do not think that even by straining the language of the provision it can be said that the non-executability of a decree within a particular territory can be considered as a privilege. Therefore the only question that we have to consider is whether it can be considered as a right accrued within the meaning of S. 20 (1) (b) of the Code of Civil Procedure (Amendment) Act, 1951. In the first place, in order to get the benefit of that provision, the non-executability of the decree must be a right and secondly it must be a right that had accrued from the provisions of the repealed law. It is contended on behalf of the judgment-debtors that when the decree was passed, they had a right to resist the execution of the decree in Madhya Bharat in view of the provisions of the Indian Code of Civil Procedure (as adapted) which was in force in the Madhya Bharat at that time and the same is a vested right. It was further urged on their behalf that that right was preserved by Section 20 (1) (b) of the Code of Civil Procedure Amendment Act, 1951.It is difficult to consider the non-executability of the decree in Madhya Bharat as a vested right of the judgment-debtors. The non-executability in question pertains to the jurisdiction of certain courts and not to the rights of the judgment-debtors. Further the relevant provisions of the Civil Procedure Code in force in Madhya Bharat did not confer the right claimed by the judgment-debtors. All that has happened in view of the extension of the Code to the whole of India in l951 is that the decrees which could have been executed only by courts in British India are now made executable in the whole of India. The change made is one relating to procedure and jurisdiction. Even before the Code was extended to Madhya Bharat the decree in question could have been executed either against the person of the judgment-debtors if they had happened to come to British India or against any of their properties situate in British India. The execution of the decree within the State of Madhya Bharat was not permissible because the arm of the Code did not reach Madhya Bharat. It was the invalidity of the order transferring the decree to the Morena court that stood in the way of the decree-holders in executing their decree in that court on the earlier occasion and not because of any vested rights of the judgment-debtors. Even if the judgment-debtors had not objected to the execution of the decree; the same could not have been executed by the court at Morena on the previous occasion as that court was not properly seized of the execution proceedings. By the extension of the Code to Madhya Bharat, want of jurisdiction on the part of the Morena court was remedied and that court is now made competent to execute thethe executing court as well as the High Court have taken the view that on the facts of this case, the limitation prescribed in S. 48 of the Code is extended under S. 14 (2) of the Limitation Act, 1908. Both those courts have concurrently come to the conclusion that the previous execution proceedings had been prosecuted by the decree-holders with due diligence and with good faith and the same became infructuous in view of the fact that the Morena Court had no jurisdiction to proceed with the execution. The finding that the previous execution proceedings were carried on with due diligence and good faith and that the same became infructuous for want of jurisdiction on the part of the Morena court was not challenged before us. But it was urged on behalf of the judgment-debtors that S. 48 prescribed a bar and not a period of limitation and consequently the decree-holders cannot take the benefit of Section 14 (2) of the Limitation Act. It is necessary to examine the correctness of thissub-section undoubtedly lends some support to the contention of the judgment-debtors. It indicates as to when the period prescribed under S. 48 (1) can be extended. By implication it can be urged that the period prescribed under S. 48 (1) of the Code can only be extended under the circumstances mentioned in that clause and not otherwise. But in assessing the correctness of that contention we have to take into consideration cl. (b) of sub-section (2) of S. 48 of the Code as well as Arts. 181 and 182 of the Limitation Act, 1908.These provisions clearly go to indicate that the period prescribed under S. 48 (1) of the Code is a period of limitation. This conclusion of ours is strengthened by the subsequent history of the legislation. By the Limitation Act 1963, S. 48 of the Code is deleted. Its place has now been taken by Art. 136 of the Limitation Act of 1963.We are of the opinion that the ratio of the above decisions correctly lay down the law. That apart, it would not be appropriate to unsettle the settled position in law.