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PETITIONER: HAJI T. J. ABDUL SHAKOOR AND OTHERS

       Vs.

RESPONDENT: BIJAY KUMAR KAPUR AND OTHERS

DATE OF JUDGMENT: 14/11/1962

BENCH: AYYANGAR, N. RAJAGOPALA BENCH: AYYANGAR, N. RAJAGOPALA IMAM, SYED JAFFER SUBBARAO, K. MUDHOLKAR, J.R.

CITATION:  1964 AIR  874            1963 SCR  Supl. (2)  46

ACT: Compromise Decree-Construction--Compromise providing sale of mortgaged Properties-Execution  proceedings-Maintainability- Code of Civil Procedure, 1905 (Act 5 of 1908), O. 23, r.3

HEADNOTE: A  suit  instituted by the respondents for the  recovery  of money  due under a simple mortgage from the  appellants  was compromised by the parties under a memo dated September  30, 1955, and the court passed a decree as per the terms of  the compromise By cl. 1 of the memo the defendants agreed to a 47 decree  being passed as prayed for in the suit, while cl.  2 recited: "That the mortgaged properties are hereby sold  for the  amount of the decree in full satisfaction  thereof  The defendants  will execute a regular sale and within ten  days from  this  date." The appellants did not  comply  with  the terms of cl. 2 and on October 31, 1955, the respondents made an application before the court praying that the  appellants might  be directed to excecute a sale deed as per the  terms of  the compromise.  The appellants pleaded that the  relief sought  by  the respondents could not be  had  in  execution proceedings  but  only by a separate suit, on  the  grounds, inter alia, that the same did not relate to the suit  within O.  23, r. 3, of the Code of Civil Procedure, and  that,  in any  case,  on a proper construction of the  compromise  the consideration therefore was not the actual execution of  the conveyance  by the judgment debtor but merely the  agreement to execute such a conveyance. Held  : (1) that the terms of the compromise related to  the suit  inasmuch  as  the property which was  to  be  conveyed consisted entirely of the property included in the mortgage. (2)  that on the true construction of the compromise, though cls..  2  to  6 might constitute an  integrated  scheme  for adjusting the rights of parties, a mere agreement to  convey contained   in  cl.  2  by  itself  did  not  amount  to   a satisfaction  of the decree and that the  consideration  for the compromise was the execution of a conveyance.

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JUDGMENT:  CIVIL APPELLATE JURISDICTION: Civil Appeal No. 176 of 1960. Appeal  from the judgment and decree dated June 2, 1958,  of the Mysore High Court in R. A. No. 268 of 1957. S.   K.  Javali,  K. P. Bhat and B. R. L. Iyengar,  for  the appellants. S.   K. Venkataranga Iyengar and R. Gopalakrishnan, for  the respondents. 1962.  November 14.  The judgment of the Court was delivered by AYYANGAR,  J.-On March 27, 1954, the three  Kapurs--who  are the respondents before us-filed original Suit No. 29 of 1954 before the District 48 judge  Banglore, against the 3 appellants who  are  brothers for  the  recovery  of  over  Rs.  50,000/-  and  subsequent interest  and  costs due on a simple mortgage.   Before  the suit  came  on  for  trial  the  parties  filed  a  memo  of compromise dated September 30, 1955 and they prayed that the suit  may decreed in terms there of The Court  accepted  the application  and  passed a decree as prayed  for  the  order reading               "It   is   ordered  and   decreed   that   the               plaintiff’s  suit  be and the same  is  hereby               decreed  as per terms of the  compromise,  the               copy of which is hereunto annexed".               The terms of the Razinama ran as follows               "1.   That  the defendants herein agree  to  a               decree being passed as prayed for.               2.    That the mortgaged properties are hereby               sold  for  the amount of the  decree  in  full               satisfaction  thereof.   The  defendants  will               execute  a  regular sale and within  ten  days               from this date.               3.    That the mortgaged properties are hereby               put  in possession of the  plaintiff  (decree-               holder)   by  the  3rd,  defendant   (judgment               debtor) and judgment debtors 1 & 2 agreeing to               pay  rent  at Rs. 75 each for  the  two  shops               bearing  Nos. 12 and 14  respectively,  Godown               Street,   Bangalore  City  in   their   actual               occupation  and  by attornment  of  the  other               properties  in  the occupation  of  the  other               tenants.               4.    That  on the judgment-debtors  or  their               nominees tendering the aforesaid decree amount               through   court   or  otherwise   within   the               aforesaid one year from the date of               49               the decree, the decrce-holders bind themselves               to  reconvey the properties which are sold  to               them   under  this  rajinama  at  their   cost               provided it is distinctly agreed that time  is               essence of the contract and provided also that               if the judgment-debtors default in paying  the               rents  as aforesaid on or before the  15th  of               any month they will lose the concession hereby               offered to thee of having reconveyance of ’the               properties in one years’ time.               5.    Attachment  on the properties  belonging               to the 2nd ’and 3rd defendants obtained before               judgment stands hereby raised.               6.    The  defendants hereby assure  that  the               properties hereby sold are not subject to  any

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                           attachment.  In ; the event of any  attachment               subsisting  on  the properties, it  is  hereby               agreed that the mortgage security shall not be               merged by the sale." Broadly  stated, the question raised in this appeal  relates to the executability of cl. 2 of this compromise decree  but before examining this contention it is necessary to state  a few’  facts.   It  would be noticed that  under  the  second sentence  of cl. 2 the appellants had to execute  a  regular sale-deed  within ten days from September 30,  1955.   They, however, did not do so and thereupon the respondents  filed, on  ;October  31, 1955, Interlocutory application No.  6  of 1955  (later  numbered as Execution Application  No.  83  of 1956) for directing the appellants to ’execute the sale-deed and  they annexed to their application a draft sale-deed  in which  cls. 3 to 6 of the razmama were recited.   Apparently there  were disputes between the parties’ each accusing  the other  :that it had not conformed to its  undertaking  under :the compromise, but with these we are not now 50 concerned.   Thereafter the appellants filed an  application in  the  suit on March 16, 1956, praying  that  a  sale-deed might  be  executed  in  favour of  a  third  party  to  the proceedings who had agreed to purchase the property on terms of paying the full decree-amount as provided for by cl. 4 of the   Razinama.   This  application  was  opposed   by   the respondents and there were further applications of a similar type which it is not necessary to detail except to point out that  they all proceeded on the basis that  the  compromise- decree was capable of execution without any necessity for  a further  suit.   The  appellants did not  succeed  in  these applications.  It is sufficient if hereafter attention  were confined to the application by the respondents-E.  A. 83  of 1956 by which they sought to get the appellants to execute a sale-deed  in  their favour in accordance with  the  opening sentence of cl. 2 of the compromise.  The appellants opposed this  application  on the technical ground that  the  relief sought could not be had in execution but only by a  separate suit  in as much as the same did not ""relate to  the  suit" within  O.  XXIII, r. 3, Code of Civil Procedure,  to  whose terms  we shall refer presently.  This objection was  upheld by the learned District judge of Bangalore and the prayer of the  respondents for directing the appellants to  execute  a sale-deed in their favour was rejected. This order has  been reversed  by the learned judges of the High Court on  appeal by  the  respondents  and it is  the  correctness  ’of  this judgment that is canvassed in this appeal which comes before us  on  a certificate of fitness granted by the  High  Court under Art. 133 (1)(a) of the Constitution. It would be seen from this narration that the point involved in  the  appeal  is very narrow and turns  on  the  question whether  the  High  Court was  justified  in  directing  the appellants  to  execute  a  sale-deed  conveying  the   suit properties   to  the  respondents  in  the  proceedings   in execution of the decree in original 51 suit No. 29 of 1954 or whether the respondents could  obtain that relief only in an independent suit instituted for  that purpose.   It is common ground that the decree embodied  the entire  razinama  including  all its  terms.   The  relevant statutory provision for the passing of decrees by compromise is O.     XXIII, r. 3, Code of Civil Procedure, which runs:               "Where it is proved to the satisfaction of the               Court that a suit has been adjusted wholly  or               in part by any lawful agreement or compromise,

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             or where the defendant satisfies the plaintiff               in  respect  of the whole or any part  of  the               subject-matter  of the suit, the  Court  shall               order    such   agreement,    compromise    or               satisfaction  to be recorded and shall pass  a               decree  in accordance therewith, so far as  it               relates to the suit." We do not having regard to the facts of this case,  consider it necessary to examine the position whether, when a  decree has  been  passed  embodying all the terms as  part  of  the decree,  an  objection  as  to  the  executability  of   any particular  term could be raised in  execution  proceedings, but  shall proceed on the basis that it could be.  There  is no  dispute that the agreement was lawful and an  executable decree  could-be passed "so far as it related to the  suit". Though  in the courts below most of the argument  turned  on the  import of the expression "so far as it relates  to  the suit" occurring in r. 3, learned Counsel for the  appellants did not stress that contention before us, but rather on  the construction  of the several clauses of the  compromise  and their inter-relation to which we shall advert presently.  We might, however, point out that the learned Judges were right in  the view they took that the. terms of the  compromise  " related" to the suit.  The property which was to be conveyed consisted entirely of property included in the mortgage  and which  was therefore liable to be sold in execution  of  the mortgage decree which was 52 the  relief  sought in the plaint.  The sale Price  for  the conveyance under the.  Razinama was the sum for the recovery of which the suit was laid.  There was  therefore    nothing which  was outside the scope of the suit.  Besides all  this the  conveyance was the consideration ’for  the  compromise. In these circumstances, it is not a matter for surprise that learned  Counsel for the appellants laid little emphasis  on the point which persuaded the teamed District judge to  dis- miss the respondents application.         Learned  Counsel for the appellants  however  raised before us two contentions in the alternative.  His first and primary contention was that on a proper construction of  the compromise,  the consideration there for was not the  actual execution  of the conveyance by the judgment debtor  to  the decree-holder  but  merely the argument to  execute  such  a conveyance.   He  pointed  out  that under  cl.   1  of  the compromise  the  defendants  had agreed to  a  decree  being passed  as ,prayed for, which meant that a  mortgage  decree drawn  up in the usual form had to be passed.  That  decree, it  was  submitted, was under the compromise  agreed  to  be treated  as satisfied and full satisfaction to  be  recorded immediately  on  the  filing  of  the  ’compromise,  and  he suggested  that the opening words in cl. 2  ’,The  mortgaged properties are hereby sold ,for the amount of the decree  in full satisfaction thereof" was a reference to the  agreement to execute the conveyance.  There were other clauses in  the compromise-’cls. 3 to 6--but these,he submitted, related ,to the inter se rights between the parties.  The contention was that  these  other  clauses of the  razinama  including  the second  limb  of  cl.  2 were intended  to  be  enforced  or implemented  not by way of execution of the decree  in  this suit but that the decree to be passed under cl.  1 was to be treated  as fully satisfied on the filing into court of  the memo of compromise and the same being recorded by the  court with  the result that thereafter no portion of the 53 decree  remained alive.  We find ourselves wholly unable  to

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accept  this argument.  No doubt.. under cl 1 there, was  to be  a simple mortgage decree as prayed for in the suit,  but it  would, however, not be a proper construction of the  1st sentence of cl. 2 to say that the mere agreement to,  convey and  not an actual conveyance was intended to operate  as  a satisfaction of the decree passed or to be passed under  cl. 1.  Learned Counsel is, no doubt, ’right in  his  submission that  the sale of’ the property to the decree-holders  under cl.  2 was not to be absolute in the sense of  conferring  a right  to an unconditional conveyance since the title  to-be obtained  under  the  sale was  subject  to  the  conditions contained in cls. 3 ,to 6 and particularly cl. 4 under which it was stipulated that the title to the property might,,  on the  happening  of certain contingencies, be  divested  from decree:-holders to whom it had been conveyed under cl. 2. In that sense cls. 2 to 6 might constitute an integrated scheme for  adjusting the rights of parties but on that account  it would  not  be  open  to  the  construction  that  the  mere agreement  to  convey  contained in cl. 2  (subject  to  the conditions stipulated in cls. 3 to 6) by itself amounted  to a satisfaction of the decree. The other submission of learned Counsel was that the learned judges   should  not  have  directed  the  execution  of   a conveyance in favour of the respondents without attaching to it the conditions laid down in cls. 3 to 6 and also  without an  examination of the question whether the appellants  were entitled  to  enforce  the reconveyance  provided  by  those clauses.   On  this  matter  the  learned  Judges  expressed themselves thus:               "The decree-holder is entitled to execute  the               decree   in  respect  of  clause  2   of   the               compromise.  No opinion is expressed as to the               executability               54               of the other clauses of the compromise as that               question has not been raised before us." The  fact, therefore, was that this point about  either  the inter-relation between cl. 2 on the one hand and cls. 3 to 6 on  the other or the contention of the appellants that  they were  entitled  to relief under cls. 3 to 6 was  not  raised before  the  High Court and the matter  was  therefore  left open.   The  appellants can in the  circumstances  obviously have no cause for complaint that the High Court did not deal with  it.   The question as to whether  the  appellants  are entitled  to  relief under cls. 3 to 6 or whether  they  had lost  their  right to do so, is one which would have  to  be investigated  on facts and cannot therefore be urged  before us.   We  do not, therefore, propose to  pronounce  upon  it either.   It would, of course, be open to the appellants  to agitate  their rights in appropriate proceeding if they  are ’so advised.   No other point has been urged before us. The appeal fails and is dismissed with costs. Appeal dismissed. 55