# LAUI RAJA & SONS v. FIRM HANSRAJ NATHURAM

- **Citation:** [1971] 3 S.C.R. 815
- **Court:** Supreme Court of India
- **Decided:** 1971-02-23
- **Bench:** S. M. Sikri, G. K. Mitter, K. s. HEGDE, J. Jaganmohan Reddy, V. Bhargava
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/laui-raja-sons-v-firm-hansraj-nathuram-5424
- **Pages:** 17

## Headnote

Code of Civil Procedure; 1908, ss. 2(5), 2(12), 20, 38, 39, 40 48Code of Civil Procedure (Amendment) Act, 1950 (Act 2 of 1951),
s. 20(1){b)-Decree passed under Code can be transjerred to any court
governed b,v Code-Court in Madhya Bharct not governed by Code prior
to passing of Act 2 of 1'951~Transfer of decree from West Bengal Court
to Madhya B.hara~ Court while invalid before passing of Act 2 of 1951
could be validly made thereafter-'Foreign Court', 'Foreign !Mcree', meaning of-Foreign Decree when a nullity-'Privileges' and 'rights' when protected under s. 20(1)(b) of Act 2 of 1951-LimitMion for ExecmionSection 48 whether provides a bar or period of limitation.
The eppellants obtained a decree against the respondent in the court
of Sub-Judge, Bankura (West Bengal) on December 3, 1949. On March
28, 1950 they applied to the court which passed the decree to transfer the
decree with a. certificate of non-satisfaction of the court at Morena in the
then State of Madhya Bharat. It was ordered accordingly. The Judgment
debtors resisted tne execut.on on the ground that the court had no jurisdiction to exeC'llte the same as the decree was that of a foreign court and
that the same had been passed ex-parte. The court accep.ed that contention and dismissed the execution petition 0n December 29, 1950. On April
l, 1951 the Code of Civil Procedttre (Amendment) Act 2 of 1951 came
into force.
By this Act the Code was extended to the former State of
Madhya Bharat as well as vario-.is other places.
Me~nwhile the appellants
appealed against the order of the Additional O:strict Judge Morena dismissing the execution petition to the High Court of Madhya Pradesh. The
appeal was allowed.
In further appeal this Court restored the order of
the Addi. District Judge, Morena. Thereafter on Fe'Jruary 15, 1963 the
appellants filed another execution case before the Bankura Court praying
for the transfer of the decree to the Mdrena Court for execution. The
Bankura Court again ordered the transfer of the decree of the Morena
Court. The judgment debtors resisted execut:on on the fo'lowing grounds :
(I) that it was barred by res ;udicata in view of the aforesaid decision
of this Court; ( 2) that it was barred by s. 48 of the Code of Civil Procedure; (3) that it was barred by limitation and (4) that it was not
executable because it was the decree of a foreign court. The Addi. District
Judge rejected the objections.
The High Court jn appeal agr°'d with
tho executing court that the execution petition was neiher barred by resiudicata nor was there any bar of limitation but it disagreed with that
court and held that the decree was not exeC'lltable as the court which
passed the decree was a fore'~n court. The decree holders filed the Present appeal by special leave. The questions which fell for consideration
were : (i) whether the decree under execution was not executable by courts
situate in the area comprised in the former State of Madhya Bharat;
(ii) whether the decree was barred by s. 48 of the Code.
HELD: Per Sikri C.J., Mitter, Hyde and Bhargava JJ. (1) (a) On
the date when the decree under execution was passed 'foreign court' was
8-l 100SupCIJ71
818
SUPREME COURT REPORTS
[1971] 3 s.c.R.
defined in s. 2(5) of the Code as a court situate beyond the limits of
A
BritISb India which had no authority in British India and was not established or continued by the Central Government.
After the amendment
of the Code of Civil Proceduro in 1951, 'foreign court' under the Coue
means a court situat< outs1ue India and not established or continued by
the authority of the Central Government.
Whether we take the earlier
definition or the present definition the Baokura Court could not be consider<d as a foreign court within the meaning of that expression in the
B
Code.
'Foreign judgment' is defined as the 'judgmenr of a foreign court'.
Hence the decree under execution could not be considered as a foreign
decree for the purpose of the Code. (820 D-GJ
Accordingly the judgment-debto

## Text

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LAUI RAJA & SONS.
v.
FIRM HANSRAJ NATHURAM
February 23, 1971
815
[S. M. SIKRI, C.J., G. K. MITTER, K. s. HEGDE, J. JAGANMOHAN
REDDY AND V. BHARGAVA, JJ.]
Code of Civil Procedure; 1908, ss. 2(5), 2(12), 20, 38, 39, 40 48Code of Civil Procedure (Amendment) Act, 1950 (Act 2 of 1951),
s. 20(1){b)-Decree passed under Code can be transjerred to any court
governed b,v Code-Court in Madhya Bharct not governed by Code prior
to passing of Act 2 of 1'951~Transfer of decree from West Bengal Court
to Madhya B.hara~ Court while invalid before passing of Act 2 of 1951
could be validly made thereafter-'Foreign Court', 'Foreign !Mcree', meaning of-Foreign Decree when a nullity-'Privileges' and 'rights' when protected under s. 20(1)(b) of Act 2 of 1951-LimitMion for ExecmionSection 48 whether provides a bar or period of limitation.
The eppellants obtained a decree against the respondent in the court
of Sub-Judge, Bankura (West Bengal) on December 3, 1949. On March
28, 1950 they applied to the court which passed the decree to transfer the
decree with a. certificate of non-satisfaction of the court at Morena in the
then State of Madhya Bharat. It was ordered accordingly. The Judgment
debtors resisted tne execut.on on the ground that the court had no jurisdiction to exeC'llte the same as the decree was that of a foreign court and
that the same had been passed ex-parte. The court accep.ed that contention and dismissed the execution petition 0n December 29, 1950. On April
l, 1951 the Code of Civil Procedttre (Amendment) Act 2 of 1951 came
into force.
By this Act the Code was extended to the former State of
Madhya Bharat as well as vario-.is other places.
Me~nwhile the appellants
appealed against the order of the Additional O:strict Judge Morena dismissing the execution petition to the High Court of Madhya Pradesh. The
appeal was allowed.
In further appeal this Court restored the order of
the Addi. District Judge, Morena. Thereafter on Fe'Jruary 15, 1963 the
appellants filed another execution case before the Bankura Court praying
for the transfer of the decree to the Mdrena Court for execution. The
Bankura Court again ordered the transfer of the decree of the Morena
Court. The judgment debtors resisted execut:on on the fo'lowing grounds :
(I) that it was barred by res ;udicata in view of the aforesaid decision
of this Court; ( 2) that it was barred by s. 48 of the Code of Civil Procedure; (3) that it was barred by limitation and (4) that it was not
executable because it was the decree of a foreign court. The Addi. District
Judge rejected the objections.
The High Court jn appeal agr°'d with
tho executing court that the execution petition was neiher barred by resiudicata nor was there any bar of limitation but it disagreed with that
court and held that the decree was not exeC'lltable as the court which
passed the decree was a fore'~n court. The decree holders filed the Present appeal by special leave. The questions which fell for consideration
were : (i) whether the decree under execution was not executable by courts
situate in the area comprised in the former State of Madhya Bharat;
(ii) whether the decree was barred by s. 48 of the Code.
HELD: Per Sikri C.J., Mitter, Hyde and Bhargava JJ. (1) (a) On
the date when the decree under execution was passed 'foreign court' was
8-l 100SupCIJ71
818
SUPREME COURT REPORTS
[1971] 3 s.c.R.
defined in s. 2(5) of the Code as a court situate beyond the limits of
A
BritISb India which had no authority in British India and was not established or continued by the Central Government.
After the amendment
of the Code of Civil Proceduro in 1951, 'foreign court' under the Coue
means a court situat< outs1ue India and not established or continued by
the authority of the Central Government.
Whether we take the earlier
definition or the present definition the Baokura Court could not be consider<d as a foreign court within the meaning of that expression in the
B
Code.
'Foreign judgment' is defined as the 'judgmenr of a foreign court'.
Hence the decree under execution could not be considered as a foreign
decree for the purpose of the Code. (820 D-GJ
Accordingly the judgment-debtors could not take advantage of the
provision in s. 13(b) of the Code under which the ex-parte decree of a
foreign court is not conclu ive.
Nor could they . take advantage of
s. 13 ( d). They were served with notice of suit but did not choose
to appear before the court. Hence, there was no basis for the contention
that any principle of natural
justice has
been contravened.
Further
s. 13 ( d) was not applicable because the juc!gment in question was not a
foreign judgment. [821 DJ
(b) Under Private International Law a decree passed by a foreign
court to whose juri diction a judgment-debtor had not submitted is an
absolute nuliity only if the local legislature had not conferred jur.sdiction
. on th1--domestic courts over the foreigners either generally or in specified
circumstances. Cb use ( c) of s. 20 of the Code provides that subject to
the limitations mentioned in the earlier sect:ons of the Code a suit can
be instituted in a court within the lo'~al limits of whose jurisdiction the
cause of action wholly or in part, arises.
This provision confers jurisdic·
tion on a court in lndi? over foreigners when the cause of action arises
within its jurisd.ction.
There was not dispute in the present case that
the cause of action for the suit which led up to the decree under execution arose within the jurisdict on of the Bankura Court.
Hence, tt must
be held that the suit in question was properly instituted. Accor"·'"gly the
decree ·n question was a va
1id decree though it migit not have been
executable at one stage in courts in the former Indian States [822 B-F)
Sardar Gurdyal Singh v. The Rajah of Faridkot, 21 I.A. 171, referred
to.
(c) A combined reading of ss. 2(121, 38, 39 and 40 of the Code
shows that a decree can be transferred for execution only to a court to
which the Code applie . This is what was rulod by this Court in Hansraj
Nathu Ram's case.
But by the date the transfer in the present case was
. made, the Code had been extended to the whole of India.
It followed
that the transfer of the decree in question which was not a foreign decree,
to the Morena Court, was in accordance with !lie provisions of the Code.·
[823 B-D).
Hansraj Nathu Ram v. La/ii Raja & Sons of Bankura, [19631 2 S.C.R.
619, applied.
Ncrsingh Rao Shitole v. Shri Shankar Saran & Ors., [1963] 2 S.C.R.
577, distinguished.
(d) Section 20(1) (b) of the Code of Civil Procedure Amenament
Act, 1951 by which the Code was extended to Madhya Bharat and other
areas undoubtedly protects the right acquired and privileges accrued under
the law repealed by the amending Act. But even bv straining the language
of the provis on it cannot be said that the non-executabi'ity of •he ciecree
within a particular territory can be considered a 'privilege' [824 E-F]
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LALJI RAJA v. FlR.M HANSll.AiJ
817
Nor is it a 'right accrued' within the meaning of s. 20(1) (b) of the
Code of Civil Procedure (Amendment) Act; 1'950. In the first place in
order to get the benefit of this provision the non-executab lity of the
decree must be a right, and secondly it must'lle a right that had accrued
from the provisions of the repealed law. It was difficJlt to coJcider the
no~-executability of the decree in Madhya Bfll\rat as a vested right of the
judgment debtors.
The non-executability in question pertain•d to the
juris<Lction of certain courts and not to the rights of the judgment
debtors.
Further the relevant provision of the Code . of Civil Prooedure
in force in Madhya Bharat did· not confer
th~ right claimed ov the
judgment-debtors. All that had haopened fo view of the extens:on of ~be
Code to the whole of India in 1951 was that the decrees which could have
been executed only by courts in Britis1' IQ11iq were made executable in
the whole of India.
The change made was one relating to procedure
and juri diction.
By the extension of the Code' to Madhya Bharat, want
of jurisdiction on the part of the Morena Court was remedied and that
court was now• competent to execute the decree [825 A-El
Hamilton Gell v. White [1922] 2 K.B. 422, Abbot v. Minisur for
Lands, [1895) A.C. 425 and G. Ogden Induitries Pvt. Ltd. v. Lucas,
[1969) I All E.R. 121, applied.
(ii) The execution was also not barred by s. 48 of the Code.
For
considering the true impact of cl. (b) of sub0s. 2 of s. 48 of the Code
provisions of Arts. 181 am~ 182 of the Limitation Act, 1908 have also
to be taken into
cons~deration.
These provision~. clearly go to irdicate
that the period prescribed under s. 48 (I) of the Code is a oerio1 of
Iim'.tation.
This interpretation is strengthened by_ tbe S'Jbsequent history
of the legislation.
By the Limitatio.n Act, 1%3 s. 48 of the Cod' is
delct·d.
Its olac" h" not been taken by A~f. ·t36 of the Vm;tation Act
of 1963 The High Courts also are now .unanimous that s. 48 of tl>e rode
is controlled by the provisions of the Limitation Act, 1908. [828 A-CJ
Kandaswami Pillai v. Kmn4oDa Chetty, A.LR. 1952 Mad. 186 (F.B.),
Durg v. Poncham, I.L.R. [1939] All. 647, Sitaram v. Chunnilalsa, I.L.R.
[1944] Nag. 250, Amarendra v. Manindra, A.I.R. 1955 Cal. 269, Kris/ma
Chwdra v Paravatammo, A.l.R. 1953 Orissa 13 and Ramgopa/ v. Sldram,
A.LR. 1943 Born. 164 referred to.
Per Jaganmohan Reddy, J.-(Concurring)
No question of a vested
right or privilege arose to entitle the respondent to challenge execufon
proceedings in Morena Court. The decree granted by the Bankura Court
was executable by the Courts governed by the sai:ne Code, by t'i, Court
which passed it or by the Court to which it ,was transf,,red.
Once the
Code was made applicable to the whole of India by Amendment Act II
of 1951 the decree was no lon~er a foreign d,ecree aua the Morena Court
which was a court under the Code to which the Bankura Court could
transfer the decree for execution. No doubt in Shitole's case it was ob·
served that s. 13 nf the Code creates substantive ri2hts and nnt merely
procedural and therefore defences that were open to the resooi.dent• were
not taken away bv any constitutional changes, but the ratic of the decision
was that the Gwalior Court not bein~ a court· that n8'•ed the d ·cree
after the comin~ into force of Act TJ of 1951 the Allaha"ad r'ott'1 could
not execute it. ·The imnediment did not exist nnw in t1'at the RRnkura
Court had t•an<forred the decree to a COtllrt under t1'o r'nde. The olea
that s. 48 r;vil l>•ocedure Code presents' a bar Of limitation was also not
tenable. [831 E-H]
818
SUPRllMt: GOU.RT REPORTS
[1971] 3 S.C.R·
Kishendas v. /ndo-Carnatic Bank Ltd. A.LR. 1958 A.P. 407 Sardar
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Gurdayal Singh v. Raja of Fc.ridkote, 21 I.A. 171, Raj Rajendra &rdar
Maloji Narsingh Rao Shito/e v. Shri Shankar Saran, [1963] 2 S.C.R. 577
and dansroj Nathuram v. Lalji Raja & Sons Bankura, [19o3] 2 S.C.R. 619,
discussed.
CIVIL APPELLA"IE Ju1ushicnoN : Civil Appeal No. 2427 0of
1966.
Appeal by special leave from the judgment and order dated
August 27, 1964 of the Madhya Pradesh High Court in Misc.
Appeal No. 20 of 1964.
S. C. Majumdar and R. K. Jain, for the appellant.
W. S. Bar/ingay, Ramesh Mali and Ganpat Rai, for the
respon~t.
The Judgment ot.S. M. S!KRI, C.J., G. K. MITTER, K. S.
HEGDE and v. BHARGAVA, JJ. was delivered by HEGDE, J.
P.
JAGANMOHAN REDDY, J. gave a separate Opinion:
Hegde, J.
This is an execution appeal. The decree-holders
are the appelbnts here.in.
This case has a long and chequered
history.
The decree-holders obtained a decree against the respondents in the court of Sub-Judge, Bankura (West Bengal) for
a sum of over Rs. 12,000/-, on December 3, 1949. On March
28, 1950 they applied to the court which passed the decree to
transfer the decree together with a certificate of non-satisfaction
to the court at Morena in the then Madhya Bharat State for execution.
It was ordered accordingly.
The execution proceedings
commenced in the courf of Additional District Judge at Morena
on Sep'ember 21, 1950 (Money Execution Case No. 8 of 1950).
The judgment-debtors resisted !he execution on the ground that
the court had no jurisdiction to execute the same as the decree
was that of a foreigu. court and that the same had been passed exparte.
The court accepted that contention and dismissed the
execution petition on December 29, 1950.
On April 1, 1951 the
Code of Civil Procedure (Amendment) Act, (Act II of 1951)
came into force.
As a result of that the Code of Civil Procedure
(in short the 'Code') was extended to the former State of Madhya
Bharat as well as as to various other places.
Meanwhile the
decree-holders appealed against the order of the learned Additional District Judge, Morena dismissing the execution petition,
to the High Court of Madhya Pradesh.
The Madhya Pradesh
Hi~h Court allowed their appeal.
As against that the judgmentdebtors appealed to this Court. This Court allowed the appeal
of the judgment-debtors and restored the order of the learned
Ad<iitional Disfrict Judge, Morena.
The decision 0of this Court
is reported in
Hanvraj Nathu Ram v.
Lalji Raj~ and sons of
Bankura (1). Therein this Court ruled that the transfer ordered by
(I) [1963] 2 S.C.R. 619.
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LALJI RAJA v. FIRM HANSRAJ tHegde, J.)
819
the Bankura court was without jurisdiction as on that date 'the
Code' did not apply to the Morena court
This Court he1d that
Morena court not being a court to which ~the Code: appJ,ed, the
decree could not have been transferred to it. lt mrther he.d that
ss. 38 and 39 of 'the Code' did not afford jurisdiction for such a
transfer.
It may be noted that at the time the Bankura Court
ordered the transfor of the decree, the Morena court was governed
by the Indian Code of Civil Procedure as adapted by the Madhya
Bharat Adaptation Order, 1948.
In other word> it was governed by a law passed by the then Madhya Bharat State.
In lhe
course of its judgment this Court observed that unqer 'the Code'
"a decree can be .executed by !\ court which passed the decree
or to which it was transferred for executiQn and the decree which
could be transferred has to be a decree passed under the Code
and the court to which it could be transferred has to be a court
which was governed by the Indian Code -0f Civil Procejure".
The first stage of the execution proceedings came to an end by the
decision 0f this Court rendere<i on April 30, 1962.
On February 15, 1963, the decree-holders filed a.nother execution case before the Bankura court.
Therein they prayed for
the transfer of the decree again to the Morena court for execution.
As noticed earlier, by that time 'the Code' had been extended to
the Madhya Bharat State which had become a part of the State
of Madhya Pradesh.
The Bankura court again or 'ered the •nns.
fer of the decree to the Morena court.
The executfon proceedings were started afresh in the Morena caurt on Au-ust 31, 1963
(Execution Case No. 1 of 1963).
The judgment-debt'rs resisted
the execution on various grounds viz. (a) that it i5 barre'.! by
res-judicata in view of the decision of this Court referretl to ear·
lier; (b) that it is barred bys. 48 of 'the Code'; (c) th~t it is
barred by limitation; and ( d) that the decree is not executable as
it is a decree of a foreign court.
. The learne? Additional District Judge rejected the objections
ra1sei by the Judgment-debtors.
The judomen•-debtors app!aled
against that order to the High Court of Madhva Pradesh.
T'1e
Hi 0 h Court agreed with the executing court that the execution
petition is neither barred by res-judicata ·nor bv s. 48 of '•he
Code', nor is there anv bar of limitation but ii disaereed with
that court and held that the decree was not e-.ecutab'e a~ tlie
court which pa~sed the decree was a foreign c~ur'. In arrivin~
at that conc!mmn it puroorted to rely on the decision of this
Court in Raj Rajen'1ra Sardrzr Malnji Narsinf!h Rri,.., s~;,,,z. v.
Sri Sh,,nkar Saran ant/ Or<. (1).
Agg·ievet.I bv •h'lt dPcision. the
de~ree-holders have brought this appeal by special leave.
From the contentions advanced before us, two questions arise
I [1963] 2 S.C.R. 577.
820
SUPRE!\l,E COURT REPORTS
[1971] 3 S.C.R.
for decision.
They are ( 1) whether the decree under execution
is not executable by courts situate in the area comprised in the
former State of Madhya Bharat and ( 2) whether the decree is
barred by s. 48 of 'the Code'.
The contention of the judgment-debtors is that the decree
under execution being a .decree of a foreign court is a nullity qua
the courts in the former State of Madhya Bharat and there.fore
the same is not executable in the Morena court.
According to
the decree-holders the decree in question is 110t a decree. of a
foreign court as contemplated 'by 'the Code' an.d the court to
which the decree is transie.rred for execution namely the Morena
court is a 'court' as contemplated by ss. 38 and 39 of 'the Code'
and therefore there can. be no valid objection to its execution in
the Morena court.
Before referfi.ng to the decided cases on the
point it is necessary to !'ead the relevant provisions of 'the Code'
as the execution is sought in accordance with the provisions therein.
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'Foreigp Court' is defined in s. 2(5) of 'the Code'.
That
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definition as it stoocl on ,he date the dectee under execution was
passed read thus :
" "foreiqn court" means a Court situate beyond the
limits of British India which has no authority in British India and is not estab.ished or continued by the
Central Government."
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A new definition of 'foreign court" was substituted by the
Code of Civil Prcedure (Amendment) Act II of 1951. That
definition reads :
" "foreign coiirt" means a court situate outside Ind;a
and not estab'ished or continued by the authority of the
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Central Govennment".
Whether we take tlie earlier definition or the preser:.t definition
into consideration the Rankura coum. cannot be considered as a
"foreign court" wi•hin the meanipg of that expression in 'the
Code'.
Fo•ei~nojudgment' is defined in 'the Code' as the judgment of 'a foreign cou11t'.
(~. 2(6) of 'the Code').
Hence the
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decree under execution cannot be considered as a foreign decree
for the purpose of the Code.
Secticl'l J 3 of 'the Code' provides that "A foreign judgment
shall be conclusive as to· any· matter thereby directly adjudicated
uoon between the sam~ parties or between parties under whom
they or any of them c.laim litigating under the same title except
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(b) where it has not been given on the merits of the case."
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LALJI RAJA v. FIRM HANSRAJ (Hegde, I.)
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The judgment with which we are concerned in this case was
an ex-par1e judgment.
The Bankura court had no jurisdiction
over the judgment-oebtors.
The Judgment-debtors did not submit themse1ves to the jurisdiction of that court though they were
served with a notice of the suit.
Hence if the BaiJrnra court
can be CQnSidered as a foreign court then s. 13 (b) would have
come to the rescue of the Judgment-deb•ors and it would have
enabled them to p.ead that the judgme.nt in question was not conclusive and consequent.y the decree is not binding agamst them.
But as the judgmeint in question cannot be considered as a judgment of a fore.gn court, they can take no assistance from s.
13 ( b). But arnstance was sought to be taken from s. Ll ( d)
which· says that the foreign judgments are not conclusive ''where
the proceedings in which the judgment was obtained are opposed
to natural justice". It was urged oo behalf of the judgmentdebtors that as the decree under execution was an ex-parte
decree, we must hold that the proceedings in which the judgment
was obtained were opposed to natural justice. We are unable
to accede to this contention.
As mentioned earlier, the judgment-debtors were served with the ilJIOtice of the suit.
They did
not choose to appear before .the court.
Hence there is no basis
for the contention that any principle of natural justice had beer;
contravened. Further as held earlier the i udgment in question is
not a forei~ judgment.
Reliance was placed on Private International Law in support of the contention that in a personal action, a decree pronounced in absentem by a foreig\ll court, to the jurisdiction oi
which the defendant had not in any way submitted himself is an
absolu:e nu lity. It was urged that the Bankura court had no
jurisdiction over the judgment-debtors and therefore the decree
pas;ed bei.ng one p~onoun.ced in absentc111 h a nullity. In support of this contentmn reltance was placed on the decision of the
Judicial Committee iL'l Sirdar Gurdva/ Sin~h v.
The Rajah of
Faridkote(').
Therein the Judicial Committee observed:.
"In a personal action,
to
which none of these
causes of jurisdicti?n aoply, a decree pronounced in
ab~entem bv a foreign Court, to the jurisdiction of
which. the ~efenda~t has not in any way submitted himself, 1s by mternatmnal law an absolute nullity."
But the Board qualified those observations by the fol'owing
words:
".He is under no obligation of anv kind to obey it;
and 1t must be regarded as a mere nullity by the Courts
(t). 21 J.A. 171.
822
SUPREME COURT REPORTS
[1971] 3 S.C.R.
of every nation except (when authorised by special local
legislation) in the country of the forum by which it was
pmnounced."
The above remarks of the Board indicate that even a decree
which is pronounced in absentem by a foreign court is va id and
executable in the country of the forum by which it was pronounced when authorised by special local legislation.
A decree passed
by a foreign court to whose jurisdiction a judgment-debtor had
not submitted is an absolute nu.lity only if the local legislature
had not conferred upon jurisdiction on the domestic- tourts over
the foreigners either generally or under specified circumstance>.
Section 20 ( c) of 'the Code' confers jurisdiction on a court in
India over the foreigners if the cause of action arises within the
jurisdiction of that court.
Hence the observation of the Board
quo:ed in some of the decisions of the courts in India including
the decision of this Court in Shitole's case(') that such a
decree is an 'absolute nullity' may not be apposite. It may be
more appropriate to say that the decree i.n ques'ion is not executable in courts outside this country. The board itself had noticed that this rule of Private International law is subject to special local legislation.
Clause ( c) of s. 20 of 'the Code' provided
at the relevant time and still provides that subject to the limitations mentioned in the earl;er sections of 'the Code', a suit can
be instituted in a court within the local limits of whose jurisdiction the cause of action. wholly or in part, arises.
There is no
dispute in this case that the cause of action for the suit which
led up to the decree under execu'ion arose within the jurisdiction
of Bankura court.
Hence it must be held that the suit in question was a proper'y insti'uted suit.
From that it fol'ows that the
decree in question is a valid decree though it mi~ht not have been
executable at one stage in courts
in the former Indian States.
This takes us to ss. 38 and 39 o.f 'the Code'.
Section 38
provides that a decree may be execu'ed either bv the c0urt which
passed it, Of by the court to which it is sent foi execution. Sec·
tion 39(1) to the extent it is material for our present purpose
prescribes :
"The Court which passed a decree may, on the
application of the decree-holder, send it for execution
to another Court-
( a) if the person a!lainst whom the decree is passed
actually and voluntarily resides or carries on busmess,
or personallv work;s. for gain within the local .limits of
the jurisdiction of such other Court ..... ·"
(1) [1963) 2 S.C.R. 577.
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LALJI RAJA v. FIRM HANSRAJ (Hegde, J.)
'823
Section 40 prescribes :
"Where a decree is sent for execution in another
State, it shall be sent to such Court and executed in
such manner as may be prescribed by rules in force in
that State."
Ru'es are defined in s. 2 ( 12) as meaning Rules and Form;
.:ontained in the 1st Schedule or made 1mdcr s .. 122 or s. 125 of
'the Code'.
On a combined reading of ss. 2(12), 33, 39 and
40, it follows that a decree can be transferred for execution
only to a court to which 'the Code' applies.
This is what was
ruled by this Court in Hansraj Nathu Ram v. Lalji Raja and som
of Bankura(1).
But by the date the impugned .transfer was
made, 'the Code' had been extended to the whole of India.
In
fact the court to which the decree was transferred is now an
entirely new court in the eye of the law-see the decision
of this Court in Shitole's case(').
From the foregoing discussion, it follows that the decree
under execution is not a foreign decree and its transfer to the
Morena court is in accordance with the provisions of 'the Code'.
That being so, the decree under execution satisfies the dictum
of this Court in Hansraj Na•hu Ram v. Laiji Raja and sons( 1)
that "a decree can be executed by a court which passed the decree
or to which it was transferred for execu'.ion and the decree wh'ch
could be transferred has ito be a decree passed under the Code
and the Court to which it cou\1 be transferred has to be a Court
which was governed by the Indian Code of Civil Procedure."
It was next urged on behalf of the judgment-debtor that in
view of the decision of this Court in Shit,,le's cave (supra) we
must hold that the decree is a nullity and that it cannot be exe-
.:uted at all in the courts situate in the former State of Madhya
Bharat.
In Shitole's case ( sunra) this Court was called upon
to consider a converse case.
Therein the decree under execution was one pa~sed l:>v a court in Gwalior State in a suit instituted in May 194 7. The defe"dqnt~ were 1he re<idents of U.P.
They did not appeal before the Gwalior court though served with
the notice.
An ex-parte decree was pa••ed against them in
November, 1948. On September, 1951, the Gwalior court
transferred the decree for execution to Allahabad and on October 16. 1951, the rlecree-holder file<f an annlica•ion for execution of the decree b~fore the AHah•bad Court. The iudgmentdeblors contende~ thqt the decree beinq a clecree of forei1m court·
to whme iurisdic'i"''l thev had not submitted, was a nullitv and
the execution aoo1ication in reonect thereof was n<Jt malnta;nah!e.
That contentinn w•~ accented by this 'court.
Tt mav be noted
that the Gwalior Court was not a court consti'uted under the
(0 !1963] 2 S.C.R. 619.
(2)(1963] 2 S.C.R. 577.
824
SUPREME COURT REPORTS
[1971] 3 S.C.R.
provisions of 'the Code'. It was admittedly a foreign court for
the purpos.:: of any proceedimgs under 'lhe Code'.
The ratio of
that decision is wholly inapplicab.e to the present case.
The
question whether a decree is a foreign decree or whether it can
be transferred to another court for execution has to be 1udged by
the provisions of 'the Code'.
It was next contended that in view of s. 20 cl. (b) of 'the
Code' of Civil Procedure (Amendment) Act, 1951 by which the
Code is extneded to Madhya Bharat and other areas, the 1udgment-debtors' right to resist the execution of the decree is protected.
Section 20 (1) of the Act deals with Repeals ana Savings.
That section to the extent relevant for our present purpose
reads:
"If, immediately before the date on which .he ;;tid
Code comes into force in any part B State corresponding to the said Code, that law shall on that date &I.and
repea'ed.
Provided that the repeal shall not affoct-
(b) any · right, privilege, ob'igation
or liability
a~quired, accrued or incurred under any law so i:epe~-
ea . . . . . . . . . . . . . . . . . . .......... -. . . . . .. as 1f this
Act had not been passed."
This provisions undoubtedly protects the rights acquired and
privileges accrued under the law repealed by' the amendmg Act.
Thererore . the question for decision is whether the non-.executability of the decree in the MJrena court under the law m torce
in Madhya Bharat before the extension o.f 'the Code' cnn b~
said· to be a right accrued under the repea!ed law.
We do not
think that even by s:raining the language of the provision it can
be said that the non-executabi,ity of a decree wi.hin a particular
territory can be c~nsidered as a privilege.
Therefore tne only
ques:.ion that we have to consider is whether it can be comidered
as a 'right accrued' within the meaning of s. 20 (1 )(b) of the
Code of Civil Procedure (Amendment) Act, 1950. In the flrst
place, in order to get the benefit of that provision, the non-executability of the decree must be a right_ Pnd secondly it must be
a right that had accrued from the provisions of the repealed law.
It is contended on behalf of the judgment-debtors that when the
decree was passed, they had a right to resist the execu<ion of the
decree in Madhya Bharat in view of the provisions of the Indian
Code of Civil Procedure (as adaptep) which was in forct. in the
Madhya Bharat at that time and th~ same is a vested ri5ht. It
was further urged on their behalf that that right was preserved by
s. 20 ( 1 )(b) of the Code of Civil Procedure Amendment Act,
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LALJI RAJA v. FIRM HANSRAJ (Hegde, /.)
825
1950. It is difficult to consider
the non-executability of the
decree in Madhya Bharat as a vested right of the judgmentdebtors.
The non-executability in question pertains to the jurisdiction Qf certain courts and not to the rights of the 1udgmentdebtors.
Further the relevant provisions of the Civil Procedure
Code in force in Madhya Bharat did not ~cinfor the right claimed
by the judgment-debtors.
All that has happened in view of the
extension of 'the Code' to the whole of India in 1951 1s th8t the
decree which could have been executed only by courts in British
India are
iflOW made executable in the whole of India.
The
change made is one relating to procedure and iurisdiction. Even
before '!he Code'. was extended to Madhya Bharat the decree in
question could
have been executed either
against the person
of the judgment-debtors if they had happened lo come
to British India or
aga~nst any
of their properties situate
in British India.
The execution of the decree within the State
of Madhya Bharat was not permissible because the arm of 'the
Code' did not reach Madhya Bharat.
It was the invalidity of the
order transferring the decree to the Morena court that stood in
the way of the decree-holders in executing their decree in that
court on the earlier occasion and not because of anv vested rights
of the judgment-debtors. Even if the judgment-debtors had 111ot
objected to the execution of the decree, the same could not have
been executed by the court at Morena on the previous occasion
as that court was not prooorly seized of the execution proceedings.
By the extension of 'the Code' to Madhya Bharat, want of
jurisdiction on the part of the Morena court was remedied and
that court is now made competent to execute the decree.
That a provision to preserve the right accrued under a repealed Act "was not intended to preserve the abstract rights conferred by the repealed Act. ... It only applies to specific rights
given to an individual upon happening of one or the other of the
events specified in statute"-see Lord Atkin's observations in
Hami!ton Gell v. White( 1). The mere right. existing a• the date
of repealing statute, to take advantage of provisions of the statute
repealed is not a "right accrued" wi'hin the meaning of the usual
saving clause-see Abbot v. Minister for Landy(") and G. Ogden
Industries Pty. Ltd. v. Lucas(3 ).
From what has been said above, it fo11ows that the view taken
bv the Hi~h Court that the decree' in question is a nullitv qua the
Morena court cannot be acceuted as correct.
The decree in
question is neither a 'foreign decree' as contemnla'ed by 'the Code'
nor its transfer to the Morena court
impermis~ible under 'the
Code'.
Bv the provisions of 'the Code' the Morena court is re0) [1922] 2 K.B. 427.
(2) [1895] A.C. 425.
(3) [1969] I All E. Report 121.
826
SUPREME COURT REPORTS
[1971] 3 S.C.R.
quired to proceed with the execution unless there is any valid
objection.
We now come to the question whether the execution is barred
bys. 48 of 'the Code'.
(That section was repealed :n 1963).
Both the executing court .as well as the High Court have taken
the view that on the facts of this case, the limitation prescribed
in s. 48 of 'the Code' is extended under s. 14.(2) of the Limitation Act, 1908. Both those courts have concurrently come to the
conclusion that the previous execution proceedings had been prosecuted by the decree-holders with due diligeince .and with good
faith and the same became .infructuous in view of the fact that
the Morena court had no jurisdiction to proceed with the execution.
The finding that th!' previous- execution proceedings were
.:arried on with due diligence and good faith and that the same
became infructuous for wa11.t of jurisdiction on the part of the
Morena court was not challenged before us.
But it was urged
on behalf of the judgment-debtors that s. 48 prescribed a bar
and not a period of limitation and .consequently the decree-holders
cannot take the benefit of s. 14(2) of the Limitation Act.
It is
necessary to examine the correctness of this contention.
Section 48 read thus :
"(1) Where an application to execute a decree not
beiing a decree granting an injunction has been made,
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made upon any fresh application presented after the
expiration of 12 years from-
(a) the date of the decree sought to be executed or
(b) where the decree or any subsequent order
directs any payment of money or the delivery . of any
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property to be made at a certain date or at recurring
periods, the date of .the default in making the payment
or delivery in respect of which the applicant seeks to
execute the decree.
(2) Nothing in this section shall be deemed-
( a) to preclude the Court from ordering the execution of a decree upon an application presented after th"e
expiration of the said term of twelve years, where the
judgment-deb\or has, by fraud or force, prevented the
execution of the decree at some time wi•hin twelve years
immediately before the date of the application; or
(b) to Fmit o• otherwise affect the operation of
article 183 of the First Schedule to the Indian Limitation Act, 1908".
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LALJI RAJA v. FIRM HANSRAJ (He,de, J.)
827
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Art. 183 of the Indian Limitation Act, 1908.read thus:
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"D!SCription of application.
Period of
Limitation
To enforce· a judgment, decree Twe1eve years
or order of any Court established
by Roy1l Charter in the exercise
of
its ordinary origi,1al
civil
j 'Jrisdiction or an order of the
Supreme Court.
Time from which
period
begins
to run.
Wlien a present right to en~
force the judgment, decrce or
order accrues to some person
capable of relel'lsing the right.
Provided that
when the
judgment, decree or order
has
been revived·, or some
part of the principle money
secured thereby or some in~
terest
on
such
money
has been
paid,
or
some
acknowledgment of Ille right
thereto
bas- been given in
writing signed by the person
liable to pay such principal
or interest or his agent, to
tbe Pohon entitled thereto
or his agent, the twelve years
shall be computed from the
date of such reviver, pay ..
meot or acknowledgment or
the latest of such revivors
priyments
or
acknowledgments,
· as
the
case
may be.
At this stage it is also necessary to read Art. 181 "of the Lllnitation Act of 1908. That Art prescribed that an application for
which no period of limitation is provided elsewhere m the Sch. to
the Limitation Act, 1908 or by s. 48 of the Code, the period of
Limitation is three years and that period begins to run when the
right to apply accrues.
Art. 182 of that Act provided that for
the execution of a decree or order of any Civil Court not provided for l:>y afticle 183 or bys. 48 of 'the Code', the periQlf of lllnitation is three years or where a certified copy of the decree or
order has been registered-six years.
The time from which the
period was to run is set out in the 3rd column of the Sch.
The argumen, advanced on behalf of the judgment-debtors is
that s. 48 is a self-contained s:;<>de and the period prescribed
therein is a bar and not a period of limitation and hence the
decree-holders cannot take the benefit of s. 14(2). In support
of this argument reliance is placed on sub-s. 2 (a) of s. 48 of 'the
Code'.
That sub-section undoubtedly lends some support to the
contention of the judgment-debtors. It indicates as to when the
period pr(\scribed under s. 48 (1) can be extended.
By implication it can be urged that the period prescribed under s. 48 ( 1) of
the Code can only be extended under the circumstances mentioned in that clause and not otherwise.
But in assessing the correct-
828
SUPREME COURT REPORTS
[1971] 3 S.C.R.
ness of that cont~ntion we have to take into consideration cl. (b)
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of sub-s. (2) of s. 48 of the Code' as well as Arts. 181 and 182
of the Limitation Act, 1908.
These provisions clearly go to
indicate that the period prescribed under s. 48( 1) of 'the Code'
is a period of limitation.
This conclusion of ours is strengthened·
by the subsequent history of the legislation.
By the Limitation
.t<
Act 1963, s. 48 of 'the C.;>de' is deleted.
Its place has now been
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taken by Art. 136 of the Limitation Act of 1963.
At one stage, there was considerable conflict
of judicial
opinion as to whether s. 48 is controlled by the provisions of the
Limitation Act 1908.
But the High Courts which had earlier
taken the view that s. 48 prescribes a bar and not limitation have
now revised their opinion.
The opinion amongst the High Courts
is now unanimous that s. 48 of 'the Code' is controlled by the
provisions of the Limitation Act, 1908-see Kandaswami Pillai
v. Kamappa Chett;r(1); Dirg v. Pancham(')'; Sitaram v. Chun,
nilal>a( 3 ); Amarendra v.
Manindra('j; Krishna Chandra v.
Paravatamma('); -and Ramgopal v. Sidram(").
We are of the opinion that the ratio of the above decisions
correctly lays down the law.
That apart, it would not be appropriate to unsettle the settled position in law.
For the r~asons mentioned above this appeal is allowed and
the order of the High Court is set aside and that of the trial court
restored.
The executing court is directed to proceed with the
execution. The respondents shall pav 1he costs of the appellants
both in this Court as well as in the High Court.
P. Jaganmohan Reddy, J.
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In the
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case of Kishendas v.
Inda Carnatic /Jank Lrd.(') I had whi'e
delivering the Judgment of the Bench expressed certain views
which may appear to conflict with the view now taken.
In that
case the executability of a decree passed by the Madras High Court
in 1940 by the City Civil Court Hyderabad on the
ground of
its b~inQ a foreiQtJ decree was called in question. The Respondent
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went into linnid"tion ""d a liquidator was aopointed by the original side of Madras High Court. The liquidator filed an
appli-
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cation under Sec. 191 of the Indian Companies Ac• for the recoverv of g sum of Rs. 1375 from the Aopellant whci was a subject of H.E.H the Nizam and a resident of Hyderabad on account
(1) A.LR. 19'7 M,d.1"6 (F.B.).
(2) T.L.R. [10101 All.'''·
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(3) I.LR. [19•4] N°g.250.
(4) A.•.R. 1955 Col. 269.
(5) A.J.R. 1953 Orissa 13.
(6) <\.l.R. 1943 Born. 164.
(7) A.I.R. 1958 A.P. 407.
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LALJI RAJA v. FIRM HANSRAJ (Jaganmohan Reddy,/.) 829
of unpaid calls and the Court passed an ex-parte
decree on
15-8-19+0 against the appellant.
Tne ,iquidator fielj an execution petition in that Court praying for a transfor of the decree
to the City Civil Court Hyderabad which was ordered on 15-3-1951
when the Hyderabad Civil Procedure Code was in force in the
Hyderabad Sta~~.