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Judgment
Prakash Krishna, J.—Heard learned Counsel for the parties. None appeared on behalf of the opposite party No. 4 namely NOIDA.
The above revision arises out of execution proceedings and is directed against the order dated 5.2.2002 passed in L.A.R. No. 389 of 1991 whereby the application filed by the present applicant for payment of the amount due under the decree to him, has been rejected. The Executing Court has held that the payment shall be made in favour of the person in whose favour i.e. M/s. Capital Finance of India Ltd., opposite party No. 1 herein, the said L.A.R has been decided and the present applicant may file suit for recovery on the basis of the agreement set up by him. The objection filed by the applicant was consequently dismissed as misconceived.
The facts of the case are almost admitted but the question of adjustment of equities between the parties, raises a vexed question of law.
The background facts which are no longer in dispute may be noticed in brief.
H.E.C. Daruwala (since deceased), on 16th of August, 1966 entered into an agreement of purchase with Smt. Raj Kapoor, Sri Ram Prakash Kapoor and M/s. Capital Finance of India (P) Ltd. To purchase 32-9-0 Pukhta land situate in villages Rasulpur, Niwada and Khora, Pergana Loni, Tehsil Ghaziabad for a total sale consideration of Rs. 30,000/-, out of which Rs. 20,000/- was paid in advance as part of sale consideration and balance Rs. 10,000/- was to be paid at the time of execution of the sale deed. Twelve months time for execution of the sale deed was fixed. The vendors failed to execute the sale deed. Therefore, the original suit No. 119 of 1969 was filed for specific performance of the aforesaid agreement, which, after contest, was decreed on July 26, 1971 by the trial Judge against the Defendants (vendors). Under the said decree the Plaintiff (H.E.C. Daruwala) was required to deposit the remaining Rs. 10,000/- in Court within 15 days which was deposited on 4th of August, 1971 by challan No. 89.
The decree of the trial Court was challenged in first appeal No. 190 of 1971 before this Court and the appeal was dismissed by a Division Bench on April 9, 1984. The decree holder applied for the execution of the said decree which was registered as execution case No. 55 of 1971 but the proceedings therein were stayed initially due to the stay order passed in the aforesaid appeal. It has been stated at the bar that the said execution proceeding is still pending and the decree is yet to be satisfied.
On 12th of February, 1988, the State Government issued a notification u/s 4 of the Land Acquisition Act which was published in the official gazette on 17th of February, 1988 for acquiring the plots covered under the said decree together with other plots and the possession of those plots was taken on 28th of February, 1989. An award u/s 11 of the Land Acquisition Act was made on 24th of September, 1990 offering the compensation at the rate Rs. 34.71 per sq. yard along with statutory benefits. Obviously, the said award was passed in favour of the vendors (original tenure holders) namely Smt. Raj Kapoor, Sri Ram Prakash Kapoor and M/s. Capital Finance of India (P) Ltd. who were Defendants in the aforesaid suit as they were recorded tenure holders. The name of decree holder i.e. H.E.C. Daruwala was not mutated. But the execution proceeding with regard to the specific performance of contract to sell was pending. The recorded tenure holders (Defendants) filed a reference u/s 18 of the Land Acquisition Act, for enhancement of the compensation amount which was registered as L.A. No. 389 of 1991: Capital Finance of India (P) Ltd. v. State. The said reference under the Land Acquisition Act has been decreed by the Civil Court namely Vth Additional District Judge, Ghaziabad by its judgment and decree dated April 18, 2001 determining the market value of the land at Rs. 108/- per sq. yard. It has been further provided that the claimant shall be entitled to other statutory benefits like solatium etc.
The award given by the Civil Court was put in execution by the vendors wherein H.E.C. Daruwala filed an application, registered as Misc. Case No. 14 of 2003, on the pleas inter alia that he had entered into an agreement with Capital Finance of India (P) Ltd. for execution of the sale deed. The said agreement was culminated into a decree of Civil Court for specific performance of contract to sell the disputed plots which have been acquired by the State Government for NOIDA. Due to the acquisition proceedings under the Land Acquisition Act, the sale deed could not be executed, the compensation amount may be paid to him. The Capital Finance of India (P) Ltd. has no right to receive the said compensation amount. The said application has been dismissed by the order dated 5.2.2003 under revision, on the short ground that "the applicant Daruwala may file suit for recovery on the basis of that agreement."
Sri H.E.C. Daruwala has expired and he has been substituted by his widow Smt. Noora Daruwala and Christopher Daruwala.
Sri Manish Goyal, learned Counsel for the applicant, submits that the applicant namely H.E.C. Daruwala (hereinafter referred to as Daruwala) being representative in interest of M/s. Capital Finance of India (P) Ltd. and having obtained a decree, is entitled to receive the compensation amount under the Land Acquisition Act and after his death his heirs are entitled to receive it.
Sri Manish Goyal, learned Counsel for the applicant submits that u/s 47(3) of C.P.C, where a question arises as to whether any person is or is not the representative of party, the such question shall, for the purposes of that Section, be determined by the Executing Court itself. Elaborating the argument, it was submitted that in view of the admitted facts of the case, Daruwala is representative of the decree holder herein namely Capital Finance of India (P) Ltd.. The submission is that the decree for specific performance of contract to sell has attained finality long ago and its execution is pending. In the meantime, the land has been acquired by the State Government and therefore, for all practical purposes, the compensation amount is payable to Daruwala under the Land Acquisition Act.
In reply, Sri B.N. Asthana and Sri J.C. Bhardwaj, Advocates, submits only one point that mere passing of a decree for the specific performance of contract to sell in respect of immovable property does not create any interest in the land in question. Elaborating the argument, it was submitted that Daruwala will have to file a suit after payment of court fees for recovery of the compensation amount against Capital Finance of India (P) Ltd.. In short, submission is that the decree passed in L.A.R. No. 389 of 1991 being in their favour, no such objection as was filed by Daruwala, is maintainable. The learned Counsel has relied upon a Full Bench decision of this Court in Mahendra Nath and Another Vs. Smt. Baikunthi Devi and Others, and a decision of the Apex Court in Bank of Baroda v. R.M. Patwa and Anr. 1996 AWC 726.
Considered the respective submissions of the counsel for the parties and perused the record. It may be placed on record that neither in the counter affidavit nor before me the facts that a suit for specific performance of contract to sell in respect of disputed land was filed and has been decreed and execution of the decree is pending and the land after passing of the decree by the Civil Court has been acquired, were disputed. It is also not in dispute that in respect of the same very land an application u/s 18 of the Land Acquisition Act for enhancement of compensation was filed by M/s. Capital Finance of India (P) Ltd. and the amount of compensation has been enhanced thereon by the Civil Court whose decree has been put under execution. The same land which was agreed upon to be sold to Daruwala has been acquired by the State Government and the compensation amount payable qua the said land has been determined by the Civil Court. The decree of the Civil Court is under execution wherein Daruwala had filed an application.
Section 47 of C.P.C lays down that all questions arising out between the parties to the suit in which the decree was passed, or their representatives, and relating to the execution, discharge or satisfaction of the decree, shall be determined by the executing Court and not by a separate suit. Further, its Sub-section (3) provides that where a question arises as to whether any person is or is not representative of a party, such question shall be determined by the Court.
A Full Bench of Lahore High Court in Bhiku Mal v. Firm Ram Chandra and Babu Lal AIR 1946 Lah 134 on interpretation of word ''representative'' as occurred in Section 47 has held that a purchaser in a private sale of property under attachment from judgment debtor is a representative of the judgment debtor u/s 47 of the Code of CPC Code. The question whether an attached property in his hands is liable to be sold in execution of the decree is a question relating to execution of decree and must be determined by the executing Court. A separate suit for determination of such question is barred by Section 47 of C.P.C..
This Court in Babu Lal Vs. Janak Dulari and Another, has held that the provisions of Section 47 makes it quite clear that the question whether or not an alleged legal representative does or does not occupy that capacity so as to be bound by the decree is one which is to be decided in the execution Court, as it does not offend against a principle that an executing Court cannot go behind the decree.
In Shalig Ram Bhagoo Kunbi and Anr. v. Mst. Dhrupati AIR 1939 Nagpur 147 it has been held that a question whether a person is or is not a representative of a party to a decree must be decided by the executing Court and not in a separate suit and once decided, it becomes final.
The expression "representative" in Section 47 has a wider meaning than the one given in Section 50 of C.P.C.. It does not mean only legal representative in the sense of the heirs, executors, administrators but includes any representative in interest i.e. transferee of the interest of decree holder or the judgment debtor who is bound by the decree.
It was not disputed and could not have been disputed that on account of the subsequent event i.e. after passing of the decree for specific performance of contract to sell, the land having been acquired under the Land Acquisition Act, the said decree for specific performance of contract to sell cannot be executed by executing a sale deed as the judgment debtors in the suit for specific performance of contract to sell have lost their title.
In Jagdish Singh Vs. Natthu Singh, a decree for specific performance of contract to sell was refused by the trial Court and the matter was pending in second appeal before the High Court when the land which was subject matter of the suit was acquired, under the Land Acquisition Act. The Apex Court has held that where relief for specific performance has become impossible, damages should be awarded instead. In such cases, there will be decree awarding to the Plaintiff compensation in lieu and substitution of one for specific performance which too for acquisition the vendee would not have been entitled to the quantum and the measure of the compensation being the entire amount of compensation determined for the acquisition of the suit properties together with all the solatium, accrued interest and all other payments under law authorising the acquisition. In that case, the Apex Court made a decree for compensation equivalent to the amount of the land acquisition compensation awarded for the suit lands.
Noticeably, the land was acquired during the pendency of second appeal preferred by the Plaintiff. There the Apex Court passed an order formally permitting the Plaintiff to amend the plaint to claim a decree in terms of Section 21 of the Specific Relief Act by amending the relief clause to the effect that a claim for compensation in lieu or in addition of the relief for specific performance be granted. In the case on hand, the decree for specific performance was already passed by the trial Court on July 26, 1971 and the execution proceedings came into existence long thereafter in the year 1982.
Section 56 of the Contract Act deals with the doctrine known as frustration of contract. The Apex Court in the case of Satyabrata Ghose Vs. Mugneeram Bangur and Co. and Another, has held that the said doctrine of frustration is equally applicable to contract for sale of land in India. As said above, the decree for specific performance of contract to sell on these facts, cannot be executed. Now, the land vests in NOIDA and the NOIDA has paid the compensation amount lying presently with the executing Court and the executing Court rejected the application of Daruwala by providing him to file a suit. On these facts, this Court is of the considered opinion that Daruwala is the representative of the decree holder namely Capital Finance of India (P) Ltd.. There appears to be no difficulty in holding that the land has been replaced, substituted, controverted or subrogated in terms of the compensation amount. The entitlement of Daruwala to receive the said compensation amount was disputed only on the ground that he should file a suit for its recovery. The said argument is bereft of justice. The agreement of purchase is of the year 1966 when two third of the sale consideration was paid and the remaining one third was paid in the year 1971. Yet Daruwala has not been able to reap the fruits of the decree which was passed way back in the year 1971 by the trial Court, confirmed by the High Court in 1984. It is in the interest of administration of justice that litigation should come to an end at the earliest and the rights of the parties be settled expeditiously. Would it be justice, as was ordered by the executing Court to ask Daruwala to file a suit for recovery of the compensation amount when the facts are not in dispute? It is not out of place to mention here that in the counter affidavit filed in the revision here, the facts referred to above in the judgment have not been disputed. In the totality of the facts of the present case it is held that Daruwala is the representative of the decree holder in reference case No. 389 of 1991, within the meaning of Section 47 of C.P.C..
Strong reliance was placed on head note A of Mahendra Nath and Another Vs. Smt. Baikunthi Devi and Others, by the learned Counsel for the opposite party who contended that mere contract for sale of land or decree for specific performance of contract does not create interest in the land. No doubt, a reading of the head note gives such an impression. On a close examination of the facts of that case would show that the controversy involved before the Full Bench was entirely different and therefore, the said decision is distinguishable on facts. There the controversy was addressed with reference to Section 30 of U.P. Consolidation of Holdings Act. The U.P. Consolidation of Holdings Act has been enacted to consolidate the holdings in villages. Its Section 30 provides a consequence which will ensue on exchange of possession. A dispute with regard to specific performance of contract to sell agricultural land arose with reference to allotment of new Chaks in pursuance of the consolidation operation in the village. On an interpretation of Section 30 of the said Act, it was held that where new plots are allotted before passing of a decree for specific performance of contract to sell, the said decree is inexecutable. The Full Bench while holding so has approved the Division Bench judgment of this Court in the case of Lala Sri Ram and Another Vs. Dhani Ram Gupta, In the said case, as noticed in paragraph 14 of the report a distinction was drawn where a decree for specific performance is passed before finalisation of Chaks. It has been held that if, however, the decree is passed before finalisation of Chaks, or if the land remains with the judgment debtor, even on allottment effect can be given to the decree. The Full Bench decision is not at all applicable to the facts of the present case as it was given under a different Statute, and in a totally different factual matrix and even if it is applicable then it supports Daruwala''s stand.
Much emphasis was laid on a decision of the Apex Court in the case of Bank of Baroda v. R.M. Patwa and Ors. (supra) by the decree holder opposite party. The learned Counsel rightly reminded me the limited scope of interference in a revision u/s 115 of C.P.C.. However, the decision relied upon by them has nothing to do even remotely with the case on hand. It was also a case which arose out of the execution proceedings. The judgment debtor therein prayed that the credit balance of one Kakkani be adjusted against the decretal amount. Kakkani was a total stranger who had some account with the decree holder Bank. There was a dispute between the decree holder Bank and Kakkani with regard to the credit amount. The High Court gave certain directions for adjustments which was not approved by the Supreme Court on the ground that Kakkani was stranger to the decree under execution. The decision was rendered by the Apex Court in peculiar facts of that case. It was held that third party rights cannot be projected for determination in a execution and the directions given on that basis by the High Court is not correct. In the case on hand Daruwala is not stranger. The issue is whether Daruwala is representative of decree holder or not. The decree in favour of Daruwala is no longer in dispute. Nor it was disputed that execution of such decree is still pending.
Having said that Daruwala is representative of decree holder. Now, the question arises - What relief, he is entitled to?
In the case of Jagdish Singh (supra) the Apex Court, in such cases, has observed that measure of compensation is by standards of Section 73 of Indian Contract Act. After quoting a passage from the Book of Pollock and Mulla on Contract, 10th Edition, the Apex Court has observed that there is no difficulty in assessing the quantum of compensation as it is ascertainable with reference to the determination of the market value in the land acquisition proceedings. The relevant passage is reproduced below:
In the present case, there is no difficulty in assessing the quantity of compensation. That is ascertainable with reference to the determination of the market value in the land acquisition proceeding. The compensation awarded may safely be taken to be measure of damages, subject, of course, to the deduction therefrom of money value of the services, time and energy spended by the Appellant in pursuing the claims of compensation and the expenditure incurred by him in the litigation culminating in the award.
A sum of Rs. 1,50,000/- was allowed to be paid to the Appellant therein on his assurance that he has not received any part compensation earlier. The same course of action may be adopted in this case also.
A sum of Rs. 57,21,755/- is the amount in dispute which represents the compensation amount as also the other statutory payments. The Court cannot loose the sight of fact that the Land Acquisition Officer had awarded compensation at the rate of Rs. 34.71 per sq. yard along with the statutory benefits. The said amount at the instance of the decree holder has been enhanced on the reference to Rs. 108/- per sq. yard along with the statutory benefits. The decree holder has undoubtedly spent time, energy and money in fighting out the litigation before the reference Court. It has to be compensated adequately. It would be fair that out of total compensation amount amounting to Rs. 57,21,755/- ten per cent whereof may be paid to the decree holder namely M/s. Capital Finance of India (P) Ltd. and the balance ninety per cent amount will go to Daruwala.
This Court while passing the interim order had provided that the decretal amount may be kept in an interest bearing security of a nationalized bank. The interest component will also be apportioned accordingly.
In view of the above, the order under revision cannot be allowed to stand. The same is hereby set aside. The revision is allowed with cost. It is provided that Daruwala is entitled to receive 90 per cent of the compensation amount along with the accrued interest in execution of L.A. No. 389 of 1991. The remaining 10 per cent amount is payable to M/s. Capital Finance of India (P) Ltd. along with accrued interest.
This order will also dispose of the Execution Case No. 55 of 1971. A sum of Rs. 10,000/- deposited by Daruwala shall be paid to the Defendants therein by the trial Court of suit No. 119 of 1969.