Eic Holdings Pvt Ltd vs Union Of India
2023 Latest Caselaw 194 Cal/2

              IN THE HIGH COURT AT CALCUTTA
              Ordinary Original Civil Jurisdiction
                       ORIGINAL SIDE


BEFORE:
The Hon'ble Justice Bibhas Ranjan De


                        EC No. 250 of 2015

                                In
              GA 1 of 2015 (Old No. GA 2203 of 2015)


                     EIC HOLDINGS PVT LTD
                                VS
                           UNION OF INDIA



For the judgement debtor        :Mr. Nand Lal Singhania,Sr. Adv.
                                 Mr. Santosh Kr. Pandey,Adv.
                                 Ms. Twinkle Kaur, Adv.



For the Decree holder          :Mr. Sabyasachi Chowdhury,Adv.
                                Ms. Vineeta Meharia, Adv.
                                Mr. Amit Mehalia,Adv.
                                Ms. Paramita Banerjee, Adv.
                                Ms. Subika Paul, Adv.
                                Ms. Ambika Deb Roy, Adv.


Hearing concluded on           : 03.01.2023

Judgment on                    : 19.01.2023
                                  2




Bibhas Ranjan De, J.:


1. This execution case was filed on 19th February, 2015 for

  execution of the decree dated 31.10.2014. As on date, principal

  amount was Rs. 1,56,68,654/- and interest thereon up to

  31.10.2014 was Rs.78,78,220/- and commission's remuneration

  of Rs. 71,400/- totaling 2,36,18,274/-.

2. On 16th June 2015 executing Court attached the account number

  32399076466 of State Bank of India to the extent of Rs. 1.50

  cores and order was communicated to the judgement debtors and

  advocate on record of the Union of India.

3. In course of pendency of the execution petition a review

  application being number RVW No. 10 of 2015 was filed by the

  judgement debtor against the decree passed on 31.10.2014.

  Accordingly, by the order of the Court dated 25.04.2016 the

  execution application was made out of the list. Finally, said

  review application was dismissed by the order dated 08.06.2022.

4. On 5th July, 2022 this Court directed State Bank of India to pay

  to the decree holder a sum of Rs. 1.50 corers attached in terms of

  order 16.06.2015 within a period of two weeks.
                                      3



5. From the order of this Court it is found that judgment debtor has

  paid Rs. 1.50 corers on 16.08.2022 and Rs. 6,68,654/- on

  26.08.2022 towards principal decretal amount.

6. Now, it is an admitted position that principal amount has already

  been paid to the decree holder but due to controversy between the

  parties regarding interest calculated by the decree holder,

  judgement debtor was given liberty to file an affidavit to the

  supplementary affidavit filed by the decree holder calculating the

  interest till 26th August, 2022.

7. Judgement debtor filed an affidavit showing a calculation of

  interest on attached amount of Rs. 1.50 corers till 16th June,

  2015 when the said amount was attached by the order of the

  Court towards payment of the principal amount and interest

  calculated on rest of Rs. 6,68,654/- till 26.08.2022 (date of

  payment of the balance amount) totaling Rs. 85,32,343.15/-.

8. Now only dispute between the parties to this execution case is

  whether decree holder is entitled to interest on entire principal

  amount till 26.08.2022 or interest on principal amount of 1.50

  corers up to 16th June, 2015 and balance amount of Rs.

  6,68,654/- till 26.08.2022.
                                      4



9. Ld. Advocate, Mr. Sabyasachi Chowdhury, appearing on behalf of

  the decree holder has contended that money decree has to be

  satisfied only in accordance with Provision of Order 21 Rule 1 of

  Civil Procedure Code, 1908. It is further contended by Mr.

  Chowdhury that attachment of the amount of Rs. 1.50 cores by

  the order of the Court on 16th June, 2015 was not available to the

  decree holder as judgement debtor challenged the decree passed

  on 31.10.2014 and for that reason the instant execution case

  remained out of list for a considerable period of time by the order

  of the Court dated 25.04.2016. Thereafter, due to disposal of the

  review application on 8th June 2022 the executing Court on 1st

  July, 2022 directed the State Bank to release attached amount of

  Rs. 1.50 corers in favour of decree holder and State Bank of India

  took time to exercise for releasing such amount in favour of the

  decree holder. Thereby, according to Mr. Chowdhury decree

  holder   received   1.50   corer       towards   principal   amount   on

  16.08.2022 and balance amount of Rs. 6,68,654/- was paid to

  the decree holder on 26.08.2022.

10.   In support of his contention Mr. Chowdhury relied on a case of

  Delhi development authority Vs. Vhai Sardhar and sons
                                     5



reported in ILR (2009) II DELHI 485, wherein it was held as

under:-


     "16. Before adverting to the judgments relied upon by both

     the sides, it is necessary to analyze a few relevant facts. To

     ward off a possible execution of the decree that followed the

     dismissal of the objections to the Award by the learned

     Single Judge on 2nd August, 2001, the appellant judgment

     debtor deposited the decretal amount of Rs. 58,80,380/- in

     this Court in terms of order dated 15th March, 2002 in CM

     No. 219/2002 in FAO(OS) 93/2002. This FAO(OS) 93/2002

     was allowed, as aforesaid, on 20th April, 2004 reviving the

     objections of the appellant. Therefore, there was no question

     of the amount deposited in the Court being available for

     appropriation to the respondent decree holder after the

judgment dated 20th April, 2004. Even when the fresh

decree was passed on 15th July, 2005, the amount already

lying deposited in the FAO(OS) 93/2002 did not become

available to the decree holder for appropriation automatically.

It is not the appellant's case that it communicated its consent

to the respondent for the withdrawal of the amount lying in

deposit in the disposed of FAO(OS) 93/2002 at any point of

time within a period of six weeks from the date of the

passing of the decree dated 15th July, 2005. In fact, the

appellant appears to have taken no steps whatsoever to

either tender the decretal amount with concessional rate of

interest within six weeks, or even otherwise to facilitate the

withdrawal of the amount deposited in the disposed of

FAO(OS) Delhi Development Authority vs Bhai Sardar Singh

& Sons by the decree holder to the extent of the decretal

amount. It was only after the decree holder had preferred

Execution Petition 168/2005 well after the expiry of the six

weeks period from 15th July, 2005, the appellant judgment

debtor for the first time gave its no objection to the decree

holder withdrawing the amount deposited in the aforesaid

FAO(OS) 93/2002 on 14 th December, 2005. Consequently,

even if one were to assume that the giving of the no objection

by the judgment debtor to the withdrawal of the decretal

amount from the deposit lying in FAO(OS) 93/2002

amounted to making payment within the meaning of Order

XXI Rule 1 CPC, the said no objection came well after the

expiry of the period of six weeks from 15th July, 2005. 17. In

our view, the act of making payment to the decree holder

under Rule 1 of Order XXI CPC would require a positive act

on the part of the judgment debtor of either depositing ―into

the Court whose duty it is to execute the decree• or to make

payment out of court to the decree holder through a postal

money or through a bank or by any other mode ―wherein

payment is evidenced in writing•, unless the Court which

made the decree otherwise directs. The payment made under

a decree, to fall within the ambit of Order XXI Rule 1 CPC has

therefore, necessarily, to be an unconditional payment by the

judgment debtor to the decree holder either directly, or

indirectly through the medium of the Court whose duty is to

execute the decree. Mere deposit of the decretal amount in a

Court, other than an executing Court can never amount to

―payment• and even where the decretal amount is deposited

in the executing court, the judgment debtors liability to pay

interest does not cease until notice contemplated by sub-

rule(2) of Rule 1 of Order XXI is given. This is evident from

sub-rule(4) above. Order XXI Rule 1 CPC does not

contemplate the decree holder having to chase the judgment

debtor to realize the decretal amount by seeking attachment

of one or the other accounts of the judgment debtor or the

properties of the judgment debtor. If resort to the execution

process of the Court is required to be made by the decree

holder, and the decretal amount is recovered in pursuance of

the order of attachment of the accounts of the judgment

debtor, and/or sale of assets of the judgment debtor, such

realization of the decretal amount would not amount to

payment of the decretal amount under Rule 1 of Order XXI.

18. When the learned Single Judge, while passing the decree

dated 15th July, 2005, granted remission in interest to the

judgment debtor on the condition of the payment being made

to the decree holder within six weeks, the Court did not

intend that the decree holder should have to take out

execution proceedings, or to chase the judgment debtor to

realize the payment under the decree. It was for the

judgment debtor to itself come forward and tender the

decretal amount, or at least to facilitate the withdrawal of the

amount deposited by the judgment debtor in Court, within

the time granted by the Court. It is not the appellants case,

and it could not have been its case that upon passing of the

decree dated 15th July, 2005, the decree holder could have

on its own approached the appellant Court for withdrawal of

the decretal amount from the deposit lying in FAO(OS)

93/2002. The amount lying deposited in FAO(OS) 93/2002,

which was allowed in favour of the judgment debtor, could

not have been accessed by the decree holder without the

consent/no objection of the judgment debtor, or through the

medium of the execution of the decree holder by obtaining

orders from the executing Court. 19. The submission of the

appellant judgment debtor that the mere deposit of the

amount in the FAO(OS) 93/2002 resulted in the stoppage of

accrual of any further interest from the date of Delhi

Development Authority vs Bhai Sardar Singh & Sons deposit

is also meritless. Even in cases where the decretal amount

flows into the coffers of the decree holder, subject to the

decree holder being required to furnish a security during the

pendency of an appeal, the Supreme Court has held in P.S.L.

Ramanathan Chettiar & Ors. (supra) that such payment does

not tantamount to payment of money under the decree. In

paras 12 and 13 of P.S.L. Ramanathan Chettiar & Ors.

(supra), the Hon'ble Supreme Court held as follows: "12. On

principle, it appears to us that the facts of a judgment-

debtor's depositing a sum in court to purchase peace by way

of stay of execution of the decree on terms that the decree-

holder can draw it out on furnishing security, does not pass

title to the money to the decree-holder. He can if he likes take

the money out in terms of the order; but so long as he does

not do it, there is nothing to prevent the judgment-debtor from

taking it out by furnishing other security, say, of immovable

property, if the court allows him to do so and on his losing

the appeal putting the decretal amount in court in terms of

Order 21 rule 1 C.P.C. in satisfaction of the decree. 13. The

real effect of deposit of money in court as was done in this

case is to put the money beyond the reach of the parties

pending the disposal of the appeal. The decree-holder could

only take it out on furnishing security which means that the

payment was not in satisfaction of the decree and the

security could be proceeded against by the judgment-debtor

in case of his success in the appeal. Pending the

determination of the same, it was beyond the reach of the

judgment-debtor. " 20. The situation in the present case is

still worse for the appellant, inasmuch as, the amount

deposited in FAO(OS) 93/2002 was not released to the

respondent till after the passing of the order dated

27.4.2006. The amount lying in deposit in the disposed of

FAO(OS) 93/2002 was not a deposit made in the executing

court in terms of Order XXI Rule 1 CPC. Admittedly, the said

deposit could not be construed as direct payment made to the

decree holder. As noticed by the learned Single Judge, when

the decree dated 15 th July, 2005 was passed, it was not

informed by the judgment debtor to the learned Single Judge

passing the decree, that the amount of Rs. 58,80,380/- stood

deposited in FAO(OS) 93/2002. Had the same been

intimated, possibly the Court may have passed an order

directing payment of the decretal amount to be made to the

decree holder from out of the said amount deposited in the

Registry of the Court, which would have been amounted to

payment under Order XXI Rule 1 CPC. 21. In Mathunni

Mathai (supra) though the judgment debtor had made the

deposit in the executing Court, but intimation in respect

thereof was not given to the decree holder. The Supreme

Court held that the payment could not be deemed to have

been appropriated towards principal unless the decree holder

admits it to be so. While examining Order XXI Rule 1,2 and

CPC, the Supreme Court observed: "..........The amended Sub-

rule (2) removes the doubt if there was any that the

judgment-debtor is not absolved of the obligation of informing

the decree- holder by written notice even in respect of deposit

in court either directly or by registered post. Delhi

Development Authority vs Bhai Sardar Singh & Sons. The

purpose of addition of the expression, 'either through court

directly or by registered post acknowledgment due' is that

the judgment-debtor should not only give notice of payment

but he must ensure that the decree holder has been served

with the notice. The ratio laid down in Meghraj case applies

now with greater rigour. The reason for the rule both in the

unamended and amended provision appears to be that if the

judgment debtor intends that the running of interest should

cease then he must intimate in writing and ensure that it is

served on the decree- holder. Sub-rules (4) and (5) added in

1976 to protect the judgment-debtor provide for cessation of

interest from the date of deposit or payment. But the

cessation of interest under sub-rule (4) takes place not by

payment alone but from the date of service of the notice

referred to in sub-rule (2)." 22. In our view, the decision of the

Constitution Bench of the Supreme Court in Gurpreet Singh

(supra) is of no avail to the appellants in the facts of this

case. In this case, the Supreme Court was considering the

aspect of the right of the decree holder to claim interest and

to appropriate the amount deposited by the judgment debtor

in pursuance of a Court decree, in different situations. The

Supreme Court while stating the legal position in paras 20

and 21 quoted above was dealing with a situation where the

judgment debtor makes a deposit in the executing Court. This

is clear from a plain reading of the above extract. However, in

the present case it cannot be said that the appellant had

made the deposit in the executing Court since the deposit had

been made in FAO(OS) 93/2002. 23. Therefore, we are of the

view that the mere fact that the deposit of Rs.58,80,380/-

was made by the appellant in FAO(OS) 93/2002 as a

condition for grant of stay for execution of the decree dated

2.8.2001 (which was eventually set aside on 20.4.2004),

does not entitle the appellant to claim that interest in terms of

the decree had stopped running from the date of deposit. No

doubt, the interest earned on the deposit made in FAO (OS)

93/2002 would enure for the benefit of the appellant. We are

also of the view that the appellant did not avail of the

conditional remission of interest granted in the decree dated

15.7.2005 by making payment within six weeks, and the

mere fact that the money was already lying deposited in

FAO(OS) 93/2002 does not have the effect of payment of the

decretal amount to the respondent decree holder. 24.

Consequently, we find no merit in the appeal preferred by the

appellant DDA, namely, EFA No.9/2007 and we dismiss the

same. So far as C.M. No.5462/2007 in FAO(OS) 93/2002 is

concerned, we accordingly allow the same while making it

clear that the respondent would be entitled to payment of

only so much of the amount lying in deposit in this Court, as

is necessary to satisfy the decree in favour of the respondent

for Rs.14,40,386/- plus interest w.e.f. 13.03.1986 @ 18%

p.a. upto the date of release of the amount in favour of the

respondent in terms of the Order dated 27.04.2006, and

after taking into account the amount released to the

respondent in terms of the aforesaid order dated 27.04.2006.

Balance amount, if any remaining in deposit in this Court

shall be released to the appellant. The registry is directed to

compute the amount due to the respondent strictly in the

aforesaid terms. Delhi Development Authority vs Bhai Sardar

Singh & Sons. With these directions the aforesaid EFA

9/2007 and the C.M. No.5462/2007 in FAO(OS) 93/2002

stand disposed off."

11. In opposition to that Ld. Senior Advocate, Mr. Nanda Lal

Singhania, appearing on behalf of the judgement debtor has

argued that the account of the decree holder was attached by the

order of the Court on 16th June, 2015 and from then on

judgement debtor had no access to that amount in that account

and moreso, the amount was available to the decree holder.

Therefore, according to Mr. Singhania, interest in terms of the

decree towards Rs. 1.50 corer had stopped running. Accordingly,

decree holder are entitled to interest till 16th June,2015 on the

amount of Rs. 1.50 corers and the interest on balance principal of

amount of Rs. 6,68,654/- till 26.08.2022. In support of his

contention Mr. Singhania relied on a case of Himachal Pradesh

Housing and Urban Development Authority Vs. Ranjit Singh

Rana reported in (2012) 4 Supreme Court Cases 505,

particularly para 14 and 15 as follows:-

" 14. The Law Laxicon, 2nd Edition reprint by P. Ramanatha

Aiyar, inter alia, states: 'payment is defined to be the act of

paying, or that which is paid; discharge of a debt, obligation

or duty; satisfaction of claim; recompense; the fulfillment of a

promise or the performance of an agreement; the discharge in

money of a sum due.'

15. The word 'payment' may have different meaning in

different context but in the context of Section 37(1)(b); it

means extinguishment of liability arising under the award. It

signifies satisfaction of the award. The deposit of the award

amount into the Court is nothing but a payment to the credit

of the decree- holder. In this view, once the award amount

was deposited by the appellants before the High Court on

May 24, 2001, the liability of post-award interest from May

24, 2001 ceased. The High Court, thus, was not right in

directing the appellants to pay the interest @ 18% p.a.

beyond May 24, 2001"

12. By referring to that aforesaid decision Mr. Singhania has tried

to supply the meaning of payment towards the credit of the

decree holder by way of attachment of account of the judgement

debtor.

13. At this stage, Mr. Chowdhury has contended that ratio of

Ranjit Singh Rana (supra) relied on the ratio of State of

Hariyana Vs, SL Arora and Company reported in (2010) 1 SCC

(Civ) 823 which was further overruled by the decision of Hyder

Consulting (Uk) limited Vs. Governor, State of Orissa reported

in (2015) 2 Supreme Court Cases 189.

14. At the very outset, it would be profitable to lay out the

Provision of Order 21Rule 1 CPC prescribing modes of payments

of money under a decree. It reads as follows:-

"Modes of paying money under decree - (1) All money,

payable under a decree shall be paid as follows, namely: -

(a) by deposit into the Court whose duty it is to execute the

decree, or sent to that Court by postal money order or

through a bank; or (b) out of Court, to the decree-holder by

postal money order or through a bank or by any other mode

wherein payment is evidenced in writing; or (c) otherwise, as

the Court which made the decree, directs. 2. Where any

payment is made under clause (a) or clause (c) of sub-rule (1),

the judgment-debtor shall give notice thereof to the decree-

holder either through the Court or directly to him by

registered post, acknowledgement due. 3. Where money is

paid by postal money order or through a bank under clause

(a) or clause (b) of sub-rule (1), the money order or payment

through bank, as the case may be, shall accurately state the

following particulars, namely:- (a) the number of the original

suit; Delhi Development Authority vs Bhai Sardar Singh &

Sons the names of the parties or where there are more than

two plaintiffs or more than two defendants, as the case may

be, the names of the first two plaintiffs and the first two

defendants; (c) how the money remitted is to be adjusted,

that is to say, whether it is towards the principal, interest or

costs; (d) the number of the execution case of the Court,

where such case is pending; and (e) the name and address of

the payer. 4. On any amount paid under clause (a) or clause

(c) of sub-rule (1), interest, if any, shall cease to run from the

date of service of the notice referred to in sub-rule (2). 5. On

any amount paid under clause (b) of sub-rule (1), interest, if

any, shall cease to run from the date of such payment:

Provided that, where the decree-holder refuses to accept the

postal money order or payment through a bank, interest shall

cease to run from the date on which the money was tendered

to him, or where he avoids acceptance of the postal money

order or payment through bank, interest shall cease to run

from the date on which the money would have been tendered

to him in the ordinary course of business of the postal

authorities or the bank, as the case may be."

15. Therefore, a decree for money can be executed either by

deposit into Court or by paying to the decree holder out of Court

under Order 21 Rule 1 (a) (b). So far as, Order 21 Rule 1 (c) of

Civil Procedure Code, 1908 is concerned the Provision is not

applicable to this Court being an executing Court simpliciter.

16. Here in this case, admittedly, judgement debtor's account was

attached by the order of this Court dated 16th June, 2015 to

secure the money. Mr. Singhania on behalf of the judgement

debtor has tried to make this Court understand that the money

so attached was available to the decree holder on and from 16th

June, 2015 when the account of the judgement debtor was

attached. But factual position is that one review application being

number RVW no. 10 of 2015 was filed by the judgement debtor

against the decree dated 31.10.2014. According to Mr. Singhania

the review application filed on the issue of interest only not

against the principal amount which was attached by the order of

the Court on 16Th June, 2015 and therefore there was no

impediment for withdrawal of principal amount attached by the

order of the Court.

17. To explain the 'availability' it would be just to refer three (3)

orders of this Court dated 25th April, 2016, 5th July 2022 and 26

July, 2022. Conjoint reading of those three orders of this Court it

is found that on 25.04.2016 the execution matter went out of list

and on 05.07.2022 again the execution case came into track and

bank was directed to release the attached amount of Rs. 1.50

corers to the decree holder and from order dated 26th July, 2022

it appears that bank took time for carrying out the exercise for

releasing the amount and ultimately on 16.08.2022 the money

was available to the decree holder. Specifically, from the order

dated 05.07.2022 it appears that execution case was kept

pending on the ground of pendency of review application.

Therefore, there was no question of the amount attached being

available for appropriation to the decree holder within the

meaning of provision of Order 21 Rule 1 Civil Procedure Code,

1908.

18. In the background of aforesaid facts and circumstances,

attachment of the account of the judgment debtor would not

tantamount to payment of decretal amount under Order 21 Rule

1 of the Civil Procedure Code,1908 even if we take assistance of

ratio of Ranjit Singh Rana (supra).

19. In the aforesaid view of the matter, I am sorry to subscribe to

the view of Mr. Singhania that attachment of the account of the

judgment debtor tantamount to payment of decretal dues within

the meaning of Provision of the Order 21 Rule 1 of the Civil

Procedure Code,1908.

20. Accordingly, decree holder is entitled to interest till the date of

payment of principal amount of Rs. 1.50 corer on 16th August,

2022 and also the interest on balance amount of Rs. 6,68,654/-

till 26.08.2022.

21. Judgement debtor is directed to pay the interest of Rs.

1,51,06,996/- either by way of bank draft or by transferring the

amount to the account of decree holder through RTGS or NFT,

within 4 weeks from date.

22. Parties are directed to file affidavit of compliance. Matter is

returnable on 16th February, 2023.

[BIBHAS RANJAN DE, J.]