Nanjappa Goundan vs Sreeranga Chettiar

Alfred Henry Lionel Leach, C.J.—The appellant was indebted to the respondent under a deed of mortgage. The appellant applied to the

Debt Conciliation Board, Coimbatore, for a settlement of the debt and the Board decided that the appellant should pay to the respondent a sum of

Rs. 664. As a result of this direction an agreement was executed by the parties on the 19th August, 1939, whereby it was agreed that the appellant

should pay the amount within a period of four months and that if it was not paid within that time the respondent should be at liberty to recover the

sum with interest which had accrued thereon and costs by executing the agreement as a decree for the sale of the mortgaged property. Sub-section

(2) of Section 14 of the Madras Debt Conciliation Act states that an agreement made under the first subsection (the agreement here was made

under that sub-section) shall, within thirty days from the date of the making thereof, be registered under the Indian Registration Act by the chairman

of the Board in such manner as may be prescribed and it shall then take effect as if it were a decree of a Civil Court and be executable as such.

The agreement was registered and therefore the respondent became entitled to bring the property to sale in the event of the appellant failing to pay

what was due to him under the agreement.

The appellant failed to pay what was due and consequently the respondent instituted execution proceedings in the Court of the District Munsiff,

Coimbatore As the result the property was put up for sale on the 1st February, 1943, and was purchased by the respondent. The appellant

applied under Order 21, Rule 90 of the CPC to have the sale set aside, but he did not proceed with that application. When making the application

under Order 21, Rule 90, the appellant paid into Court the amount which he calculated was due to the respondent under the decree. Before the

sale was confirmed he asked that that deposit should be treated as a payment under Order 34, Rule 5 of the Code. The District Munsiff held that

Order 34, Rule 5 did not apply and this decision was concurred in by the District Judge on appeal. This appeal is from the order of the District

Judge.

We consider that the appellant is entitled to have the money paid into Court treated as a deposit under Order 34, Rule 5. The agreement

entered into in the proceedings before the Debt Conciliation Board constitutes a decree of a Civil Court and is executable as such. It can only be

regarded as a final decree in a mortgage suit. The agreement provides that if default is made in the payment of the amount within four months, the

property shall be sold. It has been suggested that Order 34, Rule 5 can only apply where there has been a previous preliminary decree. In an

ordinary mortgage suit there must be a preliminary decree, but we have here by the operation of the Debt Conciliation Act what is in effect a final

mortgage decree without there being a preliminary decree and we think that Order 34, Rule 5 applies. It would indeed be most unjust if the

mortgagor were precluded from redeeming his property and that is what the respondent wants. If the respondent gets all that is due to him under

the agreement, which now constitutes a decree of a Civil Court, he will get all that he is in law entitled to.

In the judgment of the learned District Judge it is pointed out that the amount deposited is only Rs. 825 whereas the correct amount is Rs. 844-

9-6. There was no objection taken below to the deficiency in the deposit. The appellant will be allowed to make up the deficiency as the sale had

not been confirmed until his application was dismissed by the District Munsiff.

The appeal is allowed with costs here and below in the proceedings under Order 34, Rule 5. It follows that the order of the District Judge with

regard to costs is vacated.