Deposit by defendant of amount in satisfaction of claim
Full Text
The defendant in any suit to recover a debt or damages may, at any stage of the suit, deposit in Court such sum of money as he considers a satisfaction in full of the claim.
Plain English Summary
Enables a defendant in a money or damages action to deposit into court at any stage of the proceedings such sum as he considers full satisfaction of the claim, providing an effective procedural tool to cap liability, curtail running interest, and avoid adverse litigation costs.
Key Legal Elements
- Applicability: Suits for recovery of debt or unliquidated/liquidated damages.
- Any Stage of the Suit: Can be deposited along with the written statement or even during trial.
- Defendant's Assessment: Defendant determines the quantum he considers full satisfaction.
- Strategic Purpose: Triggers the statutory cessation of interest and shifts liability for future costs under Rules 3 and 4.
Practical Note
Strategic Defense for Defendants: 1. Freezing Interest and Costs: Order XXIV Rule 1 is a potent shield for defendants who acknowledge a debt but dispute excessive interest or inflated damages claimed by the plaintiff. Depositing the admitted principal into court under Rule 1 immediately halts the accrual of further interest under Rule 3. 2. Landmark Precedent: In Gurpreet Singh v. Union of India (2006) 8 SCC 457 (Constitution Bench), the Supreme Court emphasized that deposit under Order XXIV cuts off running interest once formal notice is served.
हिंदी पाठ
किसी ऋण या नुकसानी की वसूली के किसी भी वाद में प्रतिवादी, वाद के किसी भी प्रक्रम पर, न्यायालय में उतनी धनराशि जमा कर सकेगा जिसे वह दावे की पूर्ण तुष्टि (Satisfaction in full) के रूप में समझता है।