Heirs Who Paid ₹3.66 Lakh Under Compromise Cannot Face Further Execution For Rest Of Mesne-Profits Decree: P&H HC

The decree-holder obtained a decree for mesne profits of ₹9,38,791, with interest and costs, against the legal representatives of three original defendants.

During execution, the legal representatives of deceased defendant Kashmir Singh paid ₹3,66,150. The decree-holder acknowledged receipt and withdrew execution against them as partly satisfied; the court recalled the sale warrants.

The same legal representatives subsequently withdrew their appeal after their counsel stated before the National Lok Adalat that the matter had been compromised.

The decree-holder later commenced fresh execution for the balance. The Executing Court ordered sale warrants against property inherited by the petitioners from Kashmir Singh, reasoning that the decree remained partly unpaid. The petitioners challenged that order under Article 227 of the Constitution.

Order XXI Rule 2 CPC recognizes payment or adjustment of a decree, wholly or partly, to the decree-holder’s satisfaction; Section 47 CPC governs questions concerning execution, discharge, and satisfaction of a decree.

In Sultana Begum v. Prem Chand Jain, (1997) 1 SCC 373, a compromise extinguishing decree rights wholly or partly was recognized as an adjustment within Order XXI Rule 2 CPC.

Section 63 of the Indian Contract Act, 1872 permits a promisee to remit performance, wholly or partly, or accept other satisfaction.

Under L. Kochivareed v. P. Mariappa Gounder, (1979) 3 SCC 150, liability for mesne profits depends on the circumstances and findings; joint and several liability is not automatic merely because a consolidated award is made against multiple defendants.

A court exercising Article 227 jurisdiction may interfere where the subordinate court’s order reflects a material error in the exercise of jurisdiction.

The payment was acknowledged before the Executing Court, execution was expressly withdrawn against the petitioners, and the sale warrants against them were recalled; the petitioners then withdrew their appeal on the stated basis that the dispute had been compromised.

Considered together, these steps showed that the settlement was intended to conclude the proceedings against the petitioners, notwithstanding that the decree remained partly unsatisfied as against other judgment-debtors.

Permitting renewed execution against the petitioners would allow the decree-holder to retain the settlement’s benefit while disregarding the petitioners’ withdrawal of their appeal on that basis.

The alleged transfer of properties by Kashmir Singh did not revive a liability adjusted by the settlement. The Executing Court therefore erred by treating the decree’s remaining balance as sufficient, without addressing the settlement’s effect on enforceability against these petitioners.

It held that the decree stood adjusted and satisfied qua the petitioners, and that no further execution for the balance was maintainable against them under that decree.

The decree-holder remained at liberty to pursue execution against the legal representatives of the other judgment-debtors, subject to law and the decree’s terms; the application to vacate the interim order was dismissed.