Sarthak Wadhwa

Fighting an already conquered battle: Delays in Execution Proceedings: Part I.

Introduction

A quick perusal of the National Judicial Data Grid (NJDG) dashboard [here] reveals the sad state of (growing) judicial pendency in India. With over one crore pending civil cases, of which about 45% have been pending for over 3 years, the subordinate judiciary in India is unmistakably burdened. An assessment of this date further reveals that 14% of these matters are execution proceedings ex post the determination of original or appellate suits. This contributively aggravates other delays in the judicial process such as the staying of orders (22%) and the delay in obtaining the record in the first place (16%). Essentially, execution proceedings occupy a significant bandwidth of the subordinate courts’ functioning despite an authoritative judicial order being in place.

It is in this context that this essay’s focus on third party claims at the time of execution must be appreciated. This essay – first, charts out the long-term judicial struggle with pendency at the execution stage, from 1872-2022; second, looks at the latest ruling in Bangalore Development Authority v N Nanjappa [LL 2021 SC 712] as a case study to identify the extant legal standards to determine third-party claims at the time of execution; third, juxtaposes this legal standard against the statutory provisions of the Code of Civil Procedure (CPC); to, finally, show how on account of their inconsistency with the CPC, these standards still remain in flux. Based on these findings, this essay makes a case for a ‘first-principles’ analysis of execution proceedings under the CPC – to be undertaken in a subsequent follow-up post.

Judicial History

About 150 years ago, in General Manager, Raj Durbhunga v Maharaja Coomar Ramaput Sing [(1872) SCC OnLine PC 16] – the respondent was entitled to execute a decree of sale of the deceased’s property, which was blocked by the appellants’ decree stating that they had legally purchased the same; the decrees being mutually exclusive to the terms of the other, and both the parties being third-party to each other’s decree, subsequent judicial inquiry was led into which of them must be nullified, such that the relevant party’s claim could be addressed through the residual estate of the deceased. In reference to this peculiar, post-decree court drama emanating from onerous execution proceedings –Colville, J., of the Privy Council remarked:

“[T]he difficulties of a litigant in India begin when he has obtained a Decree.”

This situation persists even today, growing to meet the scale of litigation that has since stormed the nation. In fact, NJDG data reveals that the disposal of newly instituted execution proceedings has slowed down considerably during the pandemic – betraying the ineffectiveness of execution proceedings when looked at in isolation from the rest of the suit. Further, long time frames create a possibility of abuse of power (the litigant with resources could badger the counter party into settling and/or withdrawing the case).

Execution appears to become a tiring afterthought to the more exciting adversarial process. This view was shared by the Supreme Court – in Shub Karan Prasad Bubna v Sita Saran Bubna [(2009) 9 SCC 689]– in the context of a partition suit first filed in 1960 and decreed in 1964, which was finally decided by it as a special leave petition in 2009 (approximately 50 years after the matter was first ventilated). Noting that decree-holders seldom see the fruits of their decrees upon voluntary compliance by the judgment-debtors, the Supreme Court endorsed a continuity in legal processes, free from ‘pauses,’ such that the declaration of right, ascertainment of quantum of relief, and the execution of such relief are made part of the same contiguous suit. However, even this suggestion has not aged gracefully, and has been overturned subsequently – in Karnataka Housing Board v KA Nagamani [(2019) 6 SCC 424].

However, in 2021, in Rahul S Shah v Jinendrakumar Gandhi [(2021) 6 SCC 418], the Supreme Court addressed the above pendency in execution proceedings squarely and laid down guidelines to expedite the disposal of the same. In this case, the judgment-debtors had abused the process of the Court to delay execution by selling the decretal property thrice over, creating a string of third-party claims over it. This prompted the Court to finally acknowledge the potential for inflation and abuse inherent in Order XXI of the CPC and suggest means to avoid and ameliorate that. A few of these guidelines included – Streamlining oral application procedures to enable the execution of money-decrees, and liberalizing the attachment of property and the appointment of Court Commissioners and Receivers  On the substantive side of affairs, the Court enhanced the notice requirements under Section 47 of the CPC – elevating it from a procedural formality, to an actionable right the non-recognition of which could nullify subsequent transactions.

Extrapolating Legal Standards

The decision in Rahul Shah has been hailed to be a watershed moment in civil litigation and civil procedure; it is especially relevant for the present article since it makes the law more consistent with the 1976 Amendment to the CPC, which makes execution proceedings self-sufficient, without the institution of separate suits by independent claimants with vested interest in decretal properties. This is in compliance with the recommendations of the Law Commission as well [Report No. 14, para 453-4; Report No. 27, para 208-9]. The reason for this is its flexibility to accommodate potential exceptional circumstances: in Rahul Shah, the Supreme Court explicitly notes how the appreciation of new evidence may be permissible at the execution stage – “only in exceptional and rare cases where the question of fact could not be decided by resorting to any other expeditious method like appointment of Commissioner or calling for electronic materials including photographs or video with affidavits.” One landmark case in which the import of these guidelines was sought to be applied was Bangalore Development Authority v N Nanjappa.

This focal dispute between the Bangalore Development Authority (BDA) and N Nanjappa arises in the context of the execution proceedings filed by the respondent decree-holder, where the obstructer-appellant raised questions relating to the right, title and interest in the property concerned. The BDA had acquired the concerned land from the respondent; the land was subsequently allotted by the Government to the engineering section of the BDA. However, the same land was later leased out by the respondent without proper title thereto. The underlying proceedings from which the decree was obtained relates to the dispute between the respondent and the lessee, in which the respondent prevailed. Upon obtaining a favorable decree, the respondent sought to execute the same which was obstructed by the BDA. However, the executing court did not entertain the obstruction: the same was also dismissed in further appeals and subsequent writ petitions. Consequently, the BDA moved the Supreme Court in civil appeal.

Whereas execution proceedings are meant to facilitate the enjoyment of the fruits of a decree [In re, Overseas Aviation Engineering, (1962) 3 All ER 12], it is apparent ex facie that the execution of such a decree which is founded on a null transaction (for want of proper title) would be a gross injustice. It is this sentiment that moved the Bench to remand the matter back to the executing court, whilst granting relief to the BDA. They noted that the executing court must adjudicate all questions relating to the right, title or interest of the BDA – in light of Rule 101 of Order XXI of the CPC.

To better appreciate the executing court’s jurisdiction in this regard, it would be useful to refer to the statutory context of Order XXI, as alluded to by the Supreme Court, especially Rules 95-104 which deal with immovable property.

In Conflict: Statutory Review

Rules 95 to 104 of Order XXI of the CPC deal with the treatment of immovable property at the time of execution proceedings; thereunder, the CPC deals with matters related to resistance to possession of immovable property (Rules 97 and 98) and the dispossession of third parties apart from the judgment-debtor (Rules 99 to 104). For the purpose of this analysis, focus  is drawn to the difference between applications against obstruction made by a decree holder (under Rule 97, adjudicated in accordance with Rule 98) and the applications made by a third party against dispossession thereof, by the operation of the execution of the decree by the decree-holder (under Rule 99, adjudicated in accordance with Rule 100). Both these applications confer upon the executive court the jurisdiction and the duty to determine all questions related to any right, title or interest aired before it (per Section 101, captioned above).

In light of the above statutory review, it is apparent that the Supreme Court has appreciated the intent of the CPC to empower the executing court to decide the question brought before it by the BDA. However, despite its favorable result, the judgment suffers from two minor hiccups that undermine the argumentative merit of the Court’s holding.

First, the Court does not chart out the limits of the executing court’s power to assess such obstructor claims – making the precedential value of the judgment quite vague. Allowing any obstructor to bring forth any right, title or interest before an executing court is likely to inflate execution proceedings and delay relief for the decree-holder; this undermines the contiguity of the suit by turning execution proceedings into second trials where obstructors become interlocutors.

Second, it appears that the Court incorrectly attributes Rule 97 of Order XXI of the CPC to be the source of such ‘right, interest or title’ as claimed by the BDA; and, that it does not appreciate the subtle distinction between the claims made under Rule 97 and Rule 99 of Order XXI which would qualify how an executing court must treat a third-party claim. Rules 97 and 99 protect interests of a similar texture, albeit for different parties/stakeholders.

Rule 97 allows a decree-holder to remove any obstruction from the decretal property by any other person.

“97. Resistance or obstruction to possession of immovable property – (1) Where the holder of a decree for the possession of immovable property […] is resisted or obstructed by any person obtaining possession of the property, he may make an application to the Court complaining of such resistance or obstruction. […]”

Rule 99 allows such other persons to avoid being dispossessed of the decretal-property by establishing a more complete possessory interest therein.

“99. Dispossession by decree holder or purchaser – (1) Where any person other than the judgment debtor is dispossessed of immovable property by the holder of a decree for the possession of such property […] he may make an application to the court complaining of such dispossession. […]”

However, notably, a Court empowered to give orders under Rule 98 apropos an application made under Rule 97 has the power to commit an obstructing judgment debtor to civil imprisonment.

“98. Orders after adjudication. – […] (2) Where, upon such determination, the Court is satisfied that the resistance or obstruction was occasioned without any just cause by the judgment-debtor […], it shall direct that the applicant be put into possession of the property, and where the applicant is still resisted or obstructed in obtaining possession, the Court may also, at the instance of the applicant, order the judgment-debtor, or any person acting at his instigation or on his behalf, to be detained in the civil prison for a term which may extend to thirty days.”

Such a power remains absent under Rule 100, with reference to applications made under Rule 99. Where the Supreme Court allows the BDA to apply for possessory interest under Rule 97 – it opens up the possibility for any stranger to a suit to arbitrarily obstruct the execution of any decree obtained in it, at the pain of civil imprisonment for the decree-holder. In thus misidentifying the beneficiaries of the force of law, the Supreme Court may be pushing execution proceedings (particularly, vis-à-vis third party claims) down a slippery slope of judicial overreach.

In light of this statutory context, it becomes clear that the Indian judiciary’s 150-year old gripe with execution proceedings and third party claims has not reached a satisfactory denouement, even today. Therefore, it becomes important to explore the foundations of the theory of ‘possession’ and the ‘right, title or interest’ emergent therefrom – to identify which of the above rules is best suited to address the problem with alien-interest in decretal-property. The second part of this post utilizes first principles, legislative intent, and purposive interpretation, especially related to execution proceedings – to prescribe a feasible solution to this problem

Sarthak Wadhwa is a current undergraduate student at the National Law School of India University (NLSIU), Bengaluru.