Full Judgment Text
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PETITIONER:
PANDURANG JIVAJI
Vs.
RESPONDENT:
RAMCHANDRA GANGADHAR ASHTEKAR (DEAD) BY LRS.& ORS.
DATE OF JUDGMENT29/10/1981
BENCH:
MISRA, R.B. (J)
BENCH:
MISRA, R.B. (J)
KOSHAL, A.D.
ERADI, V. BALAKRISHNA (J)
CITATION:
1981 AIR 2235 1982 SCR (1)1020
1981 SCC (4) 569 1981 SCALE (3)1652
ACT:
Evidenc-Section 114 of the Evidencc Act-Adverse
inference against a party for his failure to appear it the
court, when can arise.
HEADNOTE:
Respondent R.G. Ashtekar (since dead) filed a regular
suit No. 215 of 1959 for the recovery of his dues from Kamla
Pictures, Kolhapur of which Bapusaheb Narayanrao Mohite
(since dead) was the sole proprietor. On an application for
an order of attachment before judgment under order 38 Rule S
of the C.P.C. a garnishee order was issued to the appellant
Apte, the mortgagee of The properties. As per the directions
of the court passed on his objection he exercised his right
under section 176 of the Contract Act and sold the property
attached to one Madhusudan Vasudeo Bavdekar, after due
notice to plaintiff Ashtekar and also after a public notice.
The suit was decreed for Rs. 9,000 in favour of the
plaintiff, who filed an application for execution and in the
said proceedings Bavdekar, the purchaser, was impleaded so
as to seek recovery of the properties in his hands by sale,
The application was dismissed holding that the property was
pledged with Apte, who validly sold it to Bavdekar and that
the attachment before judgment itself was invalid. A second
appeal before the High Court was rejected by the Chief
Justice of Maharashtra but he granted leave to appeal under
letters patent. The High Court reversed the concurrent
findings of fact recorded by courts below and in view of the
fact that Apte sold the property for Rs. 46,000 as against
Rs. 35,000 due to him, the executing court was directed to
ask Apte to deposit the excess amount of Rs. 11,000 in the
executing court in the 1st instance and in case the entire
amount of the decree holder was not satisfied then the
executing court would call upon the heirs of Bavdekar to
doposit in court the remaing amount due to Decree holder or
to produce the property attached within the time allowed by
the Court in the event of this failure, - the execution
court shall order execution against them. Hence the appeal
by appellant after obtaining special leave.
Allowing the appeal, the Court
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HELD: 1:1. The question of drawing an adverse inference
against a party for his failure to appear in court would
arise only when there is no evidence on the record. Absence
of Apte and Bavdekar from the court would matter only when
there was no evidence on the record on the point in issue.
[1026 G-H, 1025A]
1021
1:2 On the findings of fact recorded by the two courts
below, which are final and which could not be normally set
aside by the second Appellate Court, the decree-holder
cannot compel Apte or Bavdekar to produce the property as
before the Court or the proceeds of the sale of the property
as the amount due to Apte from judgment-debtor has not still
been satisfied. [1026 G-H, 1027A]
The statement of the judgment-debtor, the admission of
the decree-holder in cross-examination also the averments in
the agreement make the position clear. [1026 A]
JUDGMENT:
CIVIL APPELLATE JURISDlCTlON: Civil Appeal No. 2069 of
1970.
Appeal by special leave from the judgment and order
dated the 21st January, 1970 of the Bombay High Court in
Letters Patent Appeal No. 60 of 1964.
S. T. Desai and Mrs. J. Wad for the Appellant.
A. G. Ratnaparkhi for Respondent No. 1.
EX-parte for Respondents No. 2 & 3.
The Judgment of the Court was delivered by
MISRA, J. The present appeal by special leave arises
out of an execution proceeding and is directed against the
judgment of the High Court of Bombay dated 21st of January,
1970 in Letters Patent Appeal setting aside the order of the
Single Judge in Second Appeal. The appeal came up for
hearing on September 24, 1981. After the conclusion of the
arguments of the counsel for the parties, we allowed the
appeal with costs, set aside the judgment of the High Court
and restored that of the District Judge for reasons to be
recorded later, in the following terms:
"This appeal is allowed with costs of this Court
and the decree passed by the District Judge is
restored. Reasons will follow later on." G
We now proceed to give the reasons.
Respondent No. 1, Ramachandra Gangadhar Ashtekar (since
dead and represented by his legal representatives) filed a
regular suit No. 215 of 1959 for the recovery of his dues
from Kamla
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Pictures, Kolhapur of which Bapusaheb Narayanrao Mohite
(since dead and represented by his heirs and legal
representatives) was the sole proprietor. It appears that
after filing the suit the plaintiff applied for attachment
of the defendant’s properties before judgment under order
38, rule 5 of the Code of Civil Procedure and the following
properties were attached:
(a) Picture negative and sound negative of censored
movie "Anant Fandi".
(b) Rush prints of the above movie.
(c) Positive prints of the above movie.
(d) Raw positive films.
(e) Publicity part-posters, litho posters, photos,
enlargements, photo-negatives, bookset blocks etc.
The actual possession of the defendant’s aforesaid
properties was with Pandurang Jivajirao Apte, (for short
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Apte), the appellant, at the time of attachment.
The suit was eventually decreed for a sum of Rs. 9,000
and odd with interest and costs of the suit. The said
attachment was continued by the decree.
The decree holder sought to execute the decree by the
sale of the property attached. As stated earlier, the
property was in possession of Apte, the appellant. The
decree-holder, therefore, prayed that Apte should be called
upon to produce the property in Court and the same should be
sold.
Notice was issued to Apte, the garnishee, who appeared
and filed a written statement. He took up the plea that
property had already been pledged with him by the judgment-
debtor for his debt and that the attachment levied at the
instance of the decree-holder was subject to his encumbrance
on the property. He also alleged that he had raised this
contention in the suit itself at the time of attachment
before judgment and he was allowed by the Court to sell the
property pledged with him. Accordingly, he exercised his
right under section 176 of the Indian Contract Act and sold
the property to one Madhusudan Vasudeo Bavdekar (for short
Bavdekar) after due notice to the judgment-debtor as also
after a public notice. But the proceeds of the same were not
sufficient even to satisfy his
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Own debt. Under the circumstances he was not in a position
to A produce the property in Court.
In view of the stand taken by the appellant, Apte, the
decree holder filed an application for impleading Bavdekar,
the purchaser, as a party to the execution proceedings. The
application for impleadment was allowed and Bavdekar was
impleaded as judgment- debtor No. 2. No amendment claiming
any relief against him was, however, actually incorporated
in the application for execution. Bavdekar in his turn also
filed a written statement alleging that the property was
pledged with Apte who had sold it to him. He was a bonafide
purchaser for value without notice and the purchases being
effected in pursuance of the consent decree passed in Bombay
City Civil Court in suit No. 1047 of 1959, transfer in his
favour was valid in law. He was, therefore, not liable in
any way for the claim of the decree-holder.
The executing court came to the conclusion that the
attachment before judgment of the property in dispute was
invalid and that the property being pledged by the judgment-
debtor with the garnishee, Apte, and he having sold it under
section 176 of the Indian Contract Act with the permission
of the Court, the same could not be made available to the
decree-holder for satisfying his debt. As the only prayer in
the application for execution was for the sale of the
property in question, the executing court disposed of the
application as unsatisfied on the ground that the property
was not available for satisfaction of the decretal debt of
the decree holder. The decree-holder feeling aggrieved by
the order went up in appeal. The District Judge affirmed the
order of the executing court holding that the pledge of the
property in dispute by the judgment-debtor in favour of the
garnishee was proved, that the garnishee Apte sold the
property to Bavdekar and that the attachment of the property
before judgment was invalid.
The decree-holder undaunted by the failures, filed a
second appeal in the High Court. The appeal was summarily
rejected on 4th of May, 1963 by the Chief Justice. He,
however, granted leave to appeal under Letters Patent. The
High Court reversed the concurrent finding of fact recorded
by the two courts below on making a fresh appraisal of
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evidence and came to the following conclusions;
(1) Apte and Bavdekar had failed to establish that the
attachment in question was invalid.
1024
(2) They also failed to establish the genuineness of
the sale alleged by them.
(3) They also failed to establish that the sale
proceeds did not exceed the amount due to
appellant Apte from the judgment debtor.
(4) From the own admission of Apte the attached pro-
perty was sold for Rs. 46,000 while the charge on
the attached property in favour of Apte was only
for Rs. 35,000 and, therefore, it was open to the
executing c court to direct Apte to produce in the
Court the amount exceeding Rs. 35,000, viz., Rs.
11,000.
on these findings the appeal was allowed by the High
Court and the judgments of the two courts below were set
aside and the case was sent back to the executing court with
the directions that (I) Apte shall deposit in the executing
court Rs. 11,000 on or before 1st of March, 1970, (2) that
in case the entire amount due to the decree-holder was not
satisfied out of this amount of Rs. 11,000, the executing
court shall direct the heirs of Bavdekar to deposit in the
executing court the remaining amount due the decree-holder
or to produce in that court the property attached within a
reasonable time to be fixed by the executing court, and (3)
that if Apte and Bavdekar failed to carry out the above
direction, the executing court shall order execution against
them for the amount indicated above. Apte has now come to
this Court to challenge the judgment of the High Court in
the Letters Patent Appeal.
The first contention raised on behalf of the appellant
is that the High Court had no jurisdiction to reverse the
concurrent finding of fact. This contention was raised
before the High Court in Letters Patent appeal as well but
the same was over-ruled on the ground that the courts below
had approached the case from an erroneous view of law in as
much as they failed to raise the necessary presumption
against Apte and Bavdekar on account of their failure to
appear before the court.
In our opinion the question of drawing an adverse
inference against Apte and Bavdekar on account of their
absence from the court would arise only when there was no
other evidence on the
1025
record on the point in issue. The first appellate court had
relied A upon the admission of the decree-holder himself and
normally there could be no better proof than the admission
of a party. The High Court, however, has observed in its
judgment that the decree-holder has made no admission in his
evidence which would justify refusal to draw adverse
inference for the failure of Apte and Bavdekar to step into
the Witness box.
We have examined the record which was placed before us
by the counsel for the appellant and the examination of the
record indicates that the observation made by the High Court
that the decree- holder has made no such admission is not
quite correct. We may first refer to the deposition of the
decree-holder himself. In the cross-examination he admitted:
"There is an agreement executed between me and
judgment-debtor No. 1 on 29-12-58. I admit all its con-
tents.. Judgment-debtor No. 1 had told me that there is
lien of Apte on the prints and on that basis our
agreement was entered into. It is true that there is an
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agreement between us that I am to be paid my dues only
after dues of other persons including Apte arc
satisfied....It was agreed between me and Mohite that I
was to be given to the film after dues of Apte were
satisfied."
In face of this clear admission of the decree-holder it does
not lie in his mouth to say that no amount of Apte was due
from the judgment-debtor or that the agreement between Apte
and the judgment debtor was a collusive affair. Apart from
the admission of the decree-holder referred to above, the
judgment-debtor also stated as follows:
"I had given full idea to decree-holder about
Apte’s lien. There is reference to it in our agreement.
Decree holder is to get amount only after Apte’s dues
and the debt of other persons is satisfied. Apte’s debt
could not be satisfied. I had taken cash amount of Rs.
32,012 from Apte. I have signed the documents at Exhs.
4711, 4714 and 47/7 to 47113. His dues had come to Rs
39,500-56.... I had told about it to decree-holder.
Apte’s full dues are not even now satisfied by sale of
the picture to Bavdekar
1026
for Rs. 46,000. The picture was to remain in possession
of Apte till all his dues were satisfied by me."
In view of the statement of the judgment-debtor and the
admission of the decree-holder, there is not the slightest
doubt that the dues of Apte had not been cleared off by the
sale of the property in question to Bavdekar. The High Court
was not justified in ignoring the statement of the judgment-
debtor on the wrong assumption that there was no admission
by the decree holder.
In the agreement dated December 29, 1958 between the
decree-holder and the judgment debtor, Ext 58, there is a
clear reference to the amounts due to Apte from the
judgment-debtor and the decree-holder had full knowledge of
the dues of Apte. Apart from the dues of Apte there were
other dues also to be paid by the judgement-debtor. If
according to the judgment-debtor himself the amount of Rs.
46,000 which was due to Apte, had not been cleared off even
by the sale of the property to Bavdekar the decree-holder
could not proceed against the property in the hands of
Bavdekar. The attachment of the property at the instance of
the decree-holder was only subject to the lien of Apte and
unless the entire amount due to Apte was cleared off the
decree-holder could not proceed against the property in the
hands of the purchaser, Bavdekar. Therefore, the conclusion
drawn by the two courts below that the amount of Rs. 46,000
and odd was due to Apte from the judgment debtor and the
same had not been cleared off even by the sale of the
property under attachment, was based on the materials on the
record viz., the admission of the decree-holder, the
admission of the judgment-debtor and from various letters
and receipts Ext. 47/1 to Ext. 47/13. All these documents
have been lost sight of by the High Court which has indeed
exceeded its jurisdiction in reversing the finding on the
assumption that the courts below had approached the case
with a wrong view of law in not drawing an adverse inference
against Apte and Bavdekar on their failure to appear in
court when the question of loan due to Apte from the
judgment-debtor and the sale of the properties for Rs.
46,000 has been amply proved by the evidence on the record.
The question of drawing an adverse inference against a party
for his failure to appear in court would arise only when
there is no evidence on the record.
on the findings of fact recorded by the two courts
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below, which are final and which could not be normally set
aside by the Second Appellate Court, the decree-holder
cannot compel Apte or
1027
Bavdekar to produce the property before the Court or the
proceeds A of the sale of the property as l the amount due
to Apte from judgment-debtor has not still been satisfied.
For the foregoing discussion the judgment of the High
Court cannot be sustained.
S.R. Appeal allowed.
1028