1997 (7) TMI 691 - SC - Indian Laws

Supreme Court clarifies Motor Vehicles Act deposit rules, affirms interest award

The Supreme Court held that Order XXI Rule 1(2) of the Civil Procedure Code applies to Motor Vehicles Act claims in Haryana, requiring the judgment debtor ... - Issues Involved:1. Applicability of Order XXI Rule 1(2) CPC to claims under Section 110(c) of the Motor Vehicles Act, 1939.2. Justification of awarding interest from the date of deposit to the date of decree holder's knowledge of the deposit.Detailed Analysis:1. Applicability of Order XXI Rule 1(2) CPC:The primary issue for determination was whether Order XXI Rule 1(2) of the Civil Procedure Code (CPC) applies to claims under Section 110(c) of the Motor Vehicles Act, 1939. The appellant argued that this provision was not applicable in Haryana as the amendment to include Order XXI in Rule 20 of the Punjab Motor Accident Claims Tribunal Rules, 1964 was not adopted by Haryana. However, it was contended that Haryana adopted the Punjab Rules in 1972, which included the amendments made in 1968, thereby making Order XXI applicable in Haryana.The Court held that when Haryana adopted the Punjab Motor Accidents Claims Tribunal Rules in 1972, it adopted them as they stood on the date of adoption, including the amendments. Therefore, Order XXI of the CPC was applicable in Haryana.2. Justification of Awarding Interest:The second issue was whether it was justified to award interest on the decretal amount from the date of deposit (June 26, 1986) to the date the decree holder became aware of the deposit (April 19, 1989). The appellant contended that there was no obligation to inform the decree holders about the deposit and that the failure of the court to inform the decree holders should not prejudice the judgment debtor.The Court, however, emphasized the principles of fairness and justice, stating that the judgment debtor has an obligation to notify the decree holder about the deposit of the decretal amount. This obligation is rooted in Order XXI Rule 1(2) CPC, which mandates that the judgment debtor must give notice of the deposit to the decree holder. The Court held that the failure to provide such notice means the judgment debtor remains liable to pay interest until the decree holder is informed of the deposit.Conclusion:The Supreme Court concluded that Order XXI Rule 1(2) CPC applies to the Motor Vehicles Act claims in Haryana, and the judgment debtor must notify the decree holder of the deposit. The failure to do so justifies the award of interest for the period between the deposit and the decree holder's knowledge of the deposit. The appeal was dismissed, affirming the lower court's decision to award interest for the specified period. The Court also appreciated the assistance provided by Dr. Rajeev Dhavan, who appeared as amicus curiae.