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PETITIONER: ADDITIONAL COLLECTOR, BANARES

       Vs.

RESPONDENT: MAHARAJ KISHORE KHANNA

DATE OF JUDGMENT: 16/03/1959

BENCH:

ACT:        Execution of Decrees-Decree passed by Special judge in  U.P.        -If  can  be executed  outside  U.  P.-Extra-territoriality-        Transfer of such decree-Collector and Additional  Collector,        if exercise same powers-Limitation-U.  P. Encumbered Estates        Act,  1934 (U. P.XXV of 1934), ss.  14(7) and 24(3)-Code  of        Civil  Procedure, 1908 (V of 1908), s. 39-Indian  Limitation        Act, 1908 (IX of 1908), Art. 182.

HEADNOTE: The  respondent, who owned landed properties at  Banaras  in Uttar  Pradesh and at Purnea in Bihar, was heavily  indebted and  applied to the Collector, Banaras under s. 4 of the  U. P.  Encumbered  Estates Act, 1934, for, liquidation  of  his debts.   The  Collector, acting under s.  6,  forwarded  the application  to the Special judge, appointed under  the  Act who on March 21, 1940, passed after the enquiry directed  by the Act three money decrees in favour of three creditors  of the  respondent  and  forwarded them to  the  Collector  for execution.   Section  14(7) of the Act  provided  that  such decrees were to be deemed to be decrees of a civil Court 365 of  competent  jurisdiction.   Section  24(3)  of  the   Act provided  that  for purposes of execution  against  property outside U. P. such decrees were to be deemed to be in favour of  the  Collector.   The  execution  of  the  decrees   was commenced by the Additional’ Collector, Banaras against  the respondent’s properties in U. P. Thereafter, the  Additional Collector  applied to the Additional Civil  judge,  Banaras, and on January 4, 1947, got the said decrees transferred  to the  Subordinate  judge, Purnea and on March  17,  1947,  he applied  to  the  Subordinate Judge  for  execution  of  the decrees by attachment and sale of the respondents properties at  Purnea.  The Subordinate judge made an  order  directing execution to issue, but, on appeal, the High Court set aside the  order on the ground that the Subordinate Judge  had  no jurisdiction to entertain the execution application. Held, that the Subordinate judge Purnea had jurisdiction  to execute  the  decrees.  By virtue of s. 14(7) of the  Act  a decree of the Special judge was, within U. P., a decree  for all  purposes  of  the Code of  Civil  Procedure  and  could properly  be  transferred  under  S.  39  Of  the  Code  for execution  to  a Court outside U. P. No question  of  extra- territorial operation of the Act arose in the application of s.  14(7)  to  the decrees as the Purnea  Court  was  merely applying the U. P. Act to decrees passed in U. P. For  the  purposes  of execution  and  sale  the  Additional Collector  was  to  be  deemed to be  the  Collector  as  he exercised  the Collector’s powers in this regard.   As  such

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the  applications for transfer and execution of  the  decree were properly made by the Additional Collector. It  was  the same Court which exercised the  powers  of  the Additional  Civil Judge as also those of the Special  judge. The  order of transfer of the decree made by the  Additional Civil  judge  could be treated as having been  made  by  the Special judge.  As such it was made by the same Court  which passed  the decrees and was a good order under S. 39 of  the Code. The application for execution before the Subordinate  judge, Purnea  was made while execution proceedings in  respect  of the   same  decrees  were  pending  before  the   Additional Collector,  Banaras and was a continuation of the same.   No question  of  limitation could arise in respect of  such  an application.

JUDGMENT: CIVIL APPELLATE JURISDICTION: CIVIL Appeal No. 298 of 1955. Appeal from the judgment and order dated April 28, 1953,  of the Patna High Court in Appeal from Original Order No. 90 of 1949,  arising out of the judgment and order  dated  January 25, 1949, of the Sub-Judge, Purnea, in Misc.  Case No. 54 of 1947. Sir  lqbal  Ahmad,  S.  N.  Andley,  J.  B.  Dadachanji  and Rameshwar Nath, for the appellant. 366 M.C. Setalvad, Attorney-General for India and R. C.  Prasad, for the respondent. 1959.  March 16.  The Judgment of the Court was delivered by SARKAR,  J.-This  appeal  arises  out  of  a  proceeding  in execution  of an adjudication made under the  provisions  of the  United Provinces Encumbered Estates Act, 1934  (U.   P. XXV of 1934), an Act passed by the legislature of the United Provinces, now called the Uttar Pradesh.  The questions that arise in this appeal largely turn on the provisions of  that Act and they have therefore to be referred to. The  Act was intended to give relief to the  proprietors  of certain landed properties in the United Provinces.   Section 4 of the Act enabled a proprietor of such landed  properties to  make an application in writing to the Collector  of  the District  in which any of his lands is situate, stating  the amount  of his debts and asking for the application  of  the Act  to  him.   Upon such an  application  being  made,  the Collector is to make an order under s. 6 forwarding it to  a Special Judge appointed under the Act who, under s. 3 is any civil  judicial  officer  appointed for  a  local  area,  to exercise  the  powers conferred and to  perform  the  duties imposed,  by  the Act.  Section 7 of the Act  provides  that upon  the  making of an order by the Collector under  s.  6, subject  to certain exceptions which it is not necessary  to enumerate,  all  proceedings pending in the  courts  in  the United  Provinces in respect of a debt due by the  applicant shall  be stayed and all execution processes issued  against him  by such courts shall become null and void and no  fresh process  in execution shall be issued against him,  nor  any fresh  suit  or other proceeding  instituted.   The  Special Judge  after he has received the application sent to him  by the Collector is required by s. 8 to call upon the applicant to  submit a written statement verified in the manner  of  a plaint, setting out full particulars of his debts, the names and addresses of his creditors and the nature and extent  of his proprietary rights in land as also of all his properties which are liable to attachment under s. 60 of

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367 the  Code of Civil Procedure.  Under s. 9 the Special  Judge has  then  to publish a notice calling upon  persons  having claims  against  the applicant to submit the same  within  a time  specified.  Section 10 states that the claimant  shall give  full particulars of his claim and of  the  applicant’s properties.  Section 11 provides that the Special Judge will publish a further notice specifying the properties mentioned by the applicant as belonging to him and any person  wishing to  make a claim to any such property has to do so within  a certain period.  The same section gives power to the Special Judge  to  decide  the claims made  to  the  properties  and provides that the decision made by him is to be deemed to be a  decree  of  a  civil  court  of  competent  jurisdiction. Section  14  lays down that the Special Judge  will  inquire into  the  claims  submitted by the  creditors  against  the applicant  and  decide the questions in issue  on  the  same principles  as  those  on which a court of  law  would  have decided  them, but he has the power to reduce  the  interest due  and to give relief to the applicant in respect of  such claims under certain specified United Provinces Acts.   Sub- section  (7)  of  s. 14 provides that if  upon  enquiry  the Special  Judge finds that any amount is due to any  claimant he shall pass a simple money decree for such amount together with costs and interest and " such decree shall be deemed to be a decree of a civil court of competent jurisdiction " but it  shall  not  be executable within  the  United  Provinces except under the provisions of the Act.  The next section to be referred to is s. 19 which requires the Special Judge  to send the decrees granted under s. 14(7) to the Collector for execution in accordance with the provisions of Chapter V  of the  Act and to inform him of the nature and extent  of  the property  which  he has found to be liable  to  satisfy  the debts  of  the applicant.  Then come the  provisions  as  to execution  contained  in  Chapter V. The  sections  in  this Chapter provide that the Collector will himself and  without being  required to be moved for the purpose by  any  person, proceed to execute the decree against the properties of  the applicant within the United Provinces by the various methods indicated, and for 368 realising  the value of the applicant’s properties the  Col- lector  shall have all the powers of a civil court  for  the execution of a decree.  With regard to the properties of the applicant  outside the United Provinces, the Act  could  not provide  for execution.  To cover such cases it was  enacted by  s.  24(3)  that for the  purpose  of  execution  against property outside the United Provinces the decrees passed  by the Special Judge would be deemed to be decrees in favour of the Collector.  These are all the provisions of the Act that need be referred to for the purposes of this case. The  facts  may  now  be stated.   The  respondent  was  the proprietor of landed properties in the United Provinces  and was  entitled  to  claim relief under the  Act.   He  became heavily encumbered in debts.  It is not necessary to go into his  financial embarrassment in great detail and it will  be enough  to say that in 1926 and 1927 he had created  several mortgages on his properties in favour of the Allahabad Bank, the  Banaras Bank and a person called Kalia, for very  large sums.   In 1929, the Banaras Bank filed a suit  against  the respondent  in  the  Court  of  the  Additional   Sub-Judge, Banaras,  in  the United Provinces for  enforcement  of  its mortgage making the other creditors of the respondent  named above parties to the suit.  A decree was passed in that suit giving  the  creditors  priority in a  certain  order.   The

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Allahabad  Bank  not  being satisfied  with  that  order  of priority,  filed  an appeal in the High Court  at  Allahabad which  was  decided  in its favour.  While  the  appeal  was pending, the respondent applied to the Collector of  Banares for  relief under the Act.  The procedure laid down  in  the Act as earlier summarised was duly followed and on March 21, 1940,  the Special fudge of Banares to whom the  application had  been  forwarded by the Collector,  passed  three  money decrees  in favour of the three creditors of the  respondent mentioned above in a certain order of priority with which we shall  not be concerned in this case.  The total  amount  of such decrees came nearly to rupees nine lacs.  He then  sent the  decrees  to the Collector of Banaras for  execution  as required by the Act.  The execution of the decrees  369 was  thereafter  commenced  by  the  Additional   Collector, Banaras  under  the  provisions  of  the  Act  against   the properties in the United Provinces. The  respondent owns an estate in the district of Purnea  in Bihar, called the Semapur estate.  Under s. 24(3) of the Act earlier  mentioned, the decrees passed by the Special  Judge are  to be deemed to be decrees in favour of  the  Collector for  the  purpose of execution against the  Semapur  estate. The Additional Collector, Banaras, applied to the Additional Civil  Judge, Banaras, for transmission of the said  decrees to the Court of the Subordinate Judge, Purnea for  execution and an order for transmission of the decrees to the Court at Purnea  was  accordingly made by that Judge  on  January  4, 1947.    Thereafter  on  March  17,  1947,  the   Additional Collector,  Banaras,  applied  to  the  Subordinate   Judge, Purnea,  as the transferee Court to execute the  decrees  by attachment and sale of the Semapur estate.  The  Subordinate Judge  thereupon made an order directing execution to  issue as  sought.  The respondent preferred an appeal to the  High Court  at  Patna from this order of the  Subordinate  Judge, Purnea  and his appeal was allowed with the result that  the execution of the decrees against the Semapur estate  failed. The  present appeal is by the Additional Collector,  Banaras against the order of the High Court. The first question that arises in this appeal is whether the Subordinate   Judge,  Purnea,  bad  jurisdiction  to   order execution of the decree transferred to him.  The  High Court held that he did not have that jurisdiction.  The matter was put in this way.  The decree was not a decree under the Code of  Civil  Procedure.   It was only to  be  deemed  as  such because of s. 14(7) of the Act.  The Act -was an Act of  the United   Provinces  legislature  which  could  not  pass   a legislation having effect outside the United Provinces.  The operation  of  s.  14(7)  of the Act  had  therefore  to  be confined  within the borders of the United  Provinces.   The Subordinate  Judge, Purnea could not apply that  section  in Bihar and treat the decree as a decree 47 370 under  the Code.  If he could not do so he could  not  order execution of the decree.  If he were permitted  so to  apply the  Act,  then  an Act of the  legislature  of  the  United Provinces would be indirectly affecting property outside the United  Provinces which it could not directly do.   The  Act could  be  applied  in Bihar only by  giving  it  an  extra- territorial operation.  This the law did not allow.  So  the decree could not be executed in Purnea. We  think that this argument is fallacious.  No question  of any  extra-territorial application of the  United  Provinces Act either directly or indirectly, arises in this case.   It

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is clear that by virtue of s. 14(7) of the Act, a decree  of the  Special  Judge  under  the Act  is  within  the  United Provinces, a decree for all purposes of the Code.  It  could therefore  be transferred decree under s. 39 of the Code  of Civil Procedure to a court outside the United Provinces, for execution.  Now when a decree is transferred, it is the duty of  the  transferee  court  to execute  it  by  all  methods provided  by  the Code of Civil Procedure.  But it  is  said that  the  transferee court must be satisfied that it  is  a decree under the Code of Civil Procedure before it can order execution under that Code.  How then is the transferee court to  decide  that ? It has before it a decree passed  not  by itself  but by another ,court.  It has therefore to  satisfy itself that the decree was one which, for that court, was  a decree  passed  under the Code.  In order to do that  it  is asked to apply the United Provinces Act to the decree passed within the United Provinces.  How can it be said that if  it so  applies  the  United Provinces Act it is  giving  it  an extra-territorial  operation  ? It is doing nothing  of  the kind.   It  is applying an Act of the  United  Provinces  to something  which  happened within the territories  of  those Provinces;  it  is  applying an United Provinces  Act  to  a matter  within  the  competence of the  legislature  of  the United  Provinces  to  legislate upon.   No  doubt  a  court outside the United Provinces is applying a statute of  those Provinces,  but  that  does  not  amount  to  giving  extra- territorial  operation to that statute.  If the  statute  is being so applied 371 to one of its legitimate objects, it is not being given  any extra-territorial operation at all. We   further  find  it  difficult  to  appreciate  how   the application by the Subordinate Judge of Purnea of the United Provinces  Act to the decree of the Special Judge,  Banaras, sent  to him for execution, results in the United  Provinces Act  affecting property outside the United  Provinces.   The only  result of such application is to remove the  objection that  that decree is not a decree of a court in  the  United Provinces passed under the Code; the Act is not thereby made to affect property outside the United Provinces.  Of course, if that decree is a decree under the Code it can be executed against  any  property outside the United  Provinces.   That however is not the result of the United Provinces Act but of the  Code of Civil Procedure which is a central  legislation and  applies  to Bihar also.  The High Court  was  therefore wrong in thinking that the Subordinate Judge, Purnea, had no jurisdiction  to  execute the decree passed  under  the  Act within the United Provinces and sent to him for execution. It  was  then contended that the order of  transfer  of  the decree  was invalid because under s. 39 of the Code such  an order  could be made only on the application of the  decree- holder  and in the present case it had not been made on  his application.   His  point was this.  Under s. 24(3)  of  the Act,  a decree of the Special Judge is to be deemed to be  a decree  in  favour  of  the Collector  for  the  purpose  of execution  against  property outside the  United  Provinces. Therefore,  in  the  present  case  it  was  the  Collector, Banaras, who was the decree holder and he alone could  apply for the transfer of the decree.  Actually however the  order for  the  transfer  had  been  made  in  this  case  on  the application of the Additional Collector, Banaras.  So it was said the order was invalid.  Now this argument depends  upon the  Collector and the Additional Collector being  different persons.   It  is  clear however that they  are  not.   That appears  from  ss. 14 and 14A of the United  Provinces  Land

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Revenue  Act,  1901,  to  which  our  attention  was  drawn. Section  14  gives  power to the  Government  to  appoint  a Collector for discharging the 372 duties  mentioned in the Act or any other law for  the  time being  in  force.   Section  14A(1)  gives  power  to    the Government to appoint an Additional Collector.   Sub-section (3) of s. 14A provides that the " Additional Collector shall exercise such powers and perform such duties of a Collector" as  the  Government may direct.   The  Additional  Collector therefore  exercises such of the powers and discharges  such of the functions of the Collector, as the Government directs him to do.  We have before us a document containing such  an order  by which the work of sale and execution  which  under the  Encumbered Estates Act had to be done by  a  Collector, had been entrusted to the Additional Collector.  It  follows that  for the purposes of execution and sale under the  Act, the Additional Collector is to be deemed to be the Collector as  he  exercises the latter’s powers in this  regard.   The Additional Collection was hence quite competent to apply for the transfer of the decree. The  third  point against the validity of the order  of  the learned  Subordinate Judge was that under s. 39 of the  Code the  decree  could be transferred only by  the  Court  which passed it.  It was said that in the present case it is  only by  virtue  of  s. 14 of the Act that the  decision  of  the Special  Judge is deemed to be a decree ; that since it  was his  decision, he must be deemed to have passed it.  It  was then  pointed  out that the order for the  transfer  of  the decree had in fact been made by the Additional Civil  Judge, Banaras,  and not by the Special Judge, Banaras,  and  hence that order was of no effect.  This is an argument with which we  are not much impressed.  It has been pointed out  to  us that  the  powers  of a special Judge  under  the  Act  were conferred on the Court of the Additional Subordinate  Judge, Banaras,  by  the  United  Provinces  Government’s   Revenue Department notification No. 767-Rev. published in the United Provinces Gazette of the 12th October, 1935.  The Additional Subordinate  Judge later came to be called  the  Additional- Civil Judge.  It is therefore the same court which exercises the  powers of an Additional Civil Judge as also those of  a Special Judge under the Act.  We find 373 no  difficulty in treating the order of transfer  as  having been  made  by the Special Judge.  The fact that  the  order purported  to  be made by the Additional Civil Judge  was  a matter of mere irregularity and cannot make it invalid.  Nor do we find any lack of power in the Special Judge to order a transfer  of  the  I decrees.  The  Act  provides  that  his adjudication  would be treated as a decree of a civil  court of  competent jurisdiction.  The execution of such a  decree outside the United Provinces is also clearly contemplated by s.  24(3).   We  have earlier held that  such  execution  is permissible in law.  That being so, in order to give  effect to  the  provisions of the Act it has to be  held  that  the Special Judge must be deemed to be a court which passed  the decree  within  the meaning of s. 39 of the  Code  of  Civil Procedure.  Nor does there seem to be any objection to think that  the  Special  Judge  is  a  civil  court.   From   the provisions of the Act earlier set out there is no doubt that he  adjudicates upon rights of the parties and acts  in  the same  way as any other civil court would do.  Indeed,  apart from  the  fact  that  the proceedings  before  him  do  not commence  by the filing of a plaint, we find no  distinction between him and a court as ordinarily understood.  The order

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of  transfer of the decree is hence, in our view, clearly  a good order.  Lastly,  it  was  said  that  the  decree  was  barred   by limitation long before the order for its transfer was  made. It  was  contended  that  art. 182  of  the  Limitation  Act governed the case, and the application for its execution had been  made beyond the time limited.  The question  is,  does the  article apply ? The High Court held that  that  article had no application to the present case and that no  question of limitation arose " for the execution proceeding in Purnea Court  is merely a continuation of the execution  proceeding pending  before the Collector of Banares ". In our  opinion, the  High Court was right in the view that it took.   It  is quite clear that if the application for execution with which we are concerned was made in a pending execution proceeding, notion  of  the application of art. 182 arises.  It  =  long been 374 recognised  by  the courts in our country that  a  right  to continue  a  proceeding which is pending is  a  right  which arises  from  day  to day-and no question  of  any   bar  of limitation  with regard to the enforcement of such  a  right arises:  See Kedar Nath Dutt v. Harra Chand Dutt  (1)  Subba Chariar v. Muthuveeran Pillai (2). The  question  then is, was the  application  for  execution which  has  resulted  in the order  under  appeal,  one  for continuing  a  pending  execution proceeding  ?  It  is  not disputed  that  all along since the decree was sent  by  the Special Judge to the Collector for execution and before that date the decree was not executable it has continuously  been in  execution  under  the  provisions  of  the  Act  by  the Additional  Collector,  Banaras,  and  that  such  execution proceeding   was  pending  on  the  date  of   the   present application  for execution.  The question thus  is,  whether the  execution  proceeding  started  in  the  Court  of  the Subordinate  Judge,  Purnea,  was  a  continuation  of   the execution  proceeding by the Additional Collector,  Banaras. We  think it was.  We have to remember that s. 14(7) of  the Act which said that an adjudication of the special Judge was to  be deemed to be a decree also provided that that  decree would  not be executable within the United Provinces  except under  the provisions of the Act.  We have also to  remember that the Act provided that as against the properties  within the  United Provinces the decree could only be  executed  by the  Collector on his own by the various  methods  provided. We  may also point out that s. 24(4) provides that  for  the purpose  of such execution the Collector is to have all  the powers  of a civil court for the execution of a decree.   It is  therefore clear that the only mode of execution  of  the decree  within the United Provinces contemplated by the  Act is  the  execution  by the  Collector.   Within  the  United Provinces the execution of the decree by the Collector would be deemed to be an execution under the Civil Procedure Code. The  execution  by the Collector is execution of what  is  a decree within the Code.  When the decree is executed outside the  United Provinces, where, as already stated, it  can  be legally (1)  (1882)  I.L.R. 8 Cal, 420. (2) (1912) I.L.R.  36   Mad. 553. 375 executed,  the  amount  realised by  the  execution  by  the Collector   has  to  be-  taken  into  account.   When   the Subordinate  Judge,  Purnea, has to decide  the  question  , whether  the  application for execution made to  him  is  in continuance  of an existing execution proceeding, he has  to

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recognise  the proceeding before the  Additional  Collector, Banares, as a proceeding in execution under the Code for  it is so under the Act.  In doing this, for the reasons earlier mentioned,  he  would not be  giving  any  extra-territorial operation  to  the Act.  It seems to us therefore  that  the execution  of the decree by the Collector must be deemed  to be  execution of a decree for all purposes and therefore  an application  made  to  the Subordinate  Judge,  Purnea,  for execution  of the same decree while an execution  proceeding was pending before the Collector, must be a continuation  of the execution last mentioned.  No question of limitation can arise in regard to such an application. We  think therefore that this appeal must succeed.   We  set aside  the order of the High Court and restore the order  of the Subordinate Judge, Purnea.  The respondent will pay  the costs of the appellant in this Court and in the High Court. Appeal allowed.