SAIL ISP v. M/S ALPHA STEEL INDUSTRIES & ORS.

1. Record of Ex.Pet.No.25/2005 has been received. With the consent ofthe parties, the appeal is taken up for consideration. We have heard Mr. Sudhir Nandrajog, learned senior counsel for the appellant and Mr. Sanjeev Bhandari, learned counsel for EFA (OS) No.14/2015 Page 1of[5] 2015:DHC:11852-DB respondent no.1.

2. The appellant is aggrieved by the orders dated 30^'' January, 2014 and23'"'^ February, 2015.

3. Aperusal of the order dated 30^^ January, 2014 passed in Ex.Pet.No.25/2005 would show that on 30^ October, 2013, the court had directed the judgment debtor to pay an amount of Rs.30,00,000/- out ofthe decretal amount ofRs.63,85,549.37 with interest @12% per annum by the 30^^ ofJanuary 2014. It appears that in the hearing on 3O'^ January, 2014, the learned counsel for the judgment debtor handed over a draft in the sum of Rs.7,00,000/- and three post-dated cheques each dated 28^'' February, 28^'^ March and 28'^^ April, 2014 towards the remaining amount of Rs.21,00,000/-. It is submitted by learned counsel for the respondents that much more sum than the amount recorded stands paidto the decree holder.

4. Be that as it may, so far as the calculation of the amounts due and payable are concerned, the same would be effected in the execution proceedings.

5. The appellant has assailed before us the direction on 30^ January, 2014 by the learned Single Judge to the effect that the question ofpayment of interest would be considered only after the principal amount is realized by the decree holder by way of the aforesaid draft and cheques. Mr. Sudhir Nandrajog, learned senior counsel for the appellant relies on the pronouncement of the Supreme Court reported at AIR 1999 SC 1036, Industrial Credit and Development Syndicate Now called I.C.D.S. Ltd. v. EFA (OS) No.14/2015 2of[5] c Smithaben H. Patel (Smt.) &Ors. wherein it has been held that the amount ofmoney paid by the judgment debtor, has to be adjusted, firstly against the interest, then against the costs and only thereafter against the principal amount. It is submitted that this well settled principle had to apply and the amount paid by the judgment debtor had to be adjusted firstly against the interest due and payable in terms ofthejudgment and decree. Once the interest stood paid, the payments had to be adjusted against the costs awarded in favour of the appellant and only thereafter would the payments be adjusted against the principal amounts due.

6. The appellant filed Execution Application (OS)No.250/2014 praying for recalling ofthe said impugned direction as made in the order dated30^*^ January,2014.

7. We find that so far as this well settled principle oflaw is concerned, in the order dated 23^'* February, 2015 passed on Execution Application (OS)No.250/2014, even the learned Single Judge notes the same. However, the learned Single Judge had reftised to recall the direction in the order dated 23 February, 2015 on the ground that it would not be permissible to recall the order merely because the appellant had failed to show the said case law on the 30^'^ January, 2014 when the order came to be passed.

8. Itis trite that adirection which is not in consonance with the law laid down by the Supreme Court would be an error in law and amenable torecall even inexercise ofreview jurisdiction.

9. In the present case, learned counsel for the respondents does not dispute the legal position. Therefore, the direction by the EFA (OS) No.14/2015 ^ < learned Single Judge that the amount paid by the judgment debtor would be firstly adjusted towards the principal amount and only thereafter against the interest, is not sustainable in law.

10. Itis submitted by Mr. Sanjeev Bhandari, learned counsel for respondent no.l that he has objection to the impleadment of respondent nos.[2] and 3in this appeal for the reason that respondent nos.[2] and 3are not parties in the execution proceedings.

11. Mr. Sudhir Nandrajog, learned senior counsel for the appellant explains that in the execution petitions, the judgment debtor has taken the stand that the respondent no.l was a partnership firm and that the same stands dissolved.

12. Learned senior counsel would submit that it is an admitted position that respondent nos.[2] and 3 are the partners of the respondent no.l and that an application for their impleadment is pending (Ex.App.No.390/2012) adjudication.

13. Be that as itmay, the respondent nos.[2] and 3 could not have been arrayed as parties in the present matter. However, given the well settled legal position and the submissions thereon by the learned counsel for the respondents, we are not adjudicating upon the maintainability of the execution against these respondents. Their impleadment in the execution has to abide by the decision on Ex.App.No.390/2012 by the learned Single Judge. The decision on this appeal shall not be treated as an adjudication on the legality, necessity or propriety ofthe presence ofrespondent nos.[2] and 3 before the court.

14. In view ofthe above, the order dated 30^^ January, 2014 to EFA(OS)No.l4/2015 Page 4of[5] -c -r / the extent that it directs that the payments by the judgment debtor would be first adjusted against the principal amount and only after payment of the principal amount, adjustment would be effected towards the interest and the order dated 23'^'^ February, 2015 are hereby set aside and quashed. It is directed that all payments which are made by the judgment debtor after the decree, including those in the Execution Petition No.25/2005 shall be first adjusted towards the interest, then costs and ^nly thereafter would the payments be adjusted against the principal sum due and payable by the judgment debtor. The appeal is allowed in the above terms. jpTA34HPT[3]:L,J SHTA, J AUGUST 31,2015 aj EFA (OS) No.14/2015 Page 5of[5]