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1966 DIGILAW 255 (KER)

ALPHONSE LIGOURI v. COURT LIQUIDATOR

1966-09-20

S.VELU PILLAI, T.S.KRISHNAMOORTHY IYER

body1966
Judgment :- 1. The Subordinate Judge of Meenachil in execution of the decree in O. S.42 of 1951 passed by the District Court of Kottayam in favour of the Bank of Meenachil Ltd. (in liquidation) passed the order sought to be revised returning the claim petition or objection to attachment filed by the revision petitioner under 0.21 R.58 CPC. to the attachment of immovable properties effected before judgment on the ground that under S.45B of the Banking Companies Act, 1949 the High Court alone has exclusive jurisdiction to entertain and decide the same. 2. The Official Liquidator filed Report No. 82 in BCP. No. 6 of 1951 which relates to the winding up of the Bank of Meenachil Ltd., under S.45C (2) of the Banking Companies Act, 1949 bringing to the notice of this Court the pendency of the proceedings to execute the decree in OS. 42 of 1951 of the District Court, Kottayam in the Meenachil Sub Court. Since this court did not decide to transfer the execution proceedings to the file of this Court under S.45C (2) of the Banking Companies Act, 1949 the execution proceedings are being continued under S.45C (4) of the Banking Companies Act, 1949 in the Sub Court, Meenachil where the proceedings were then pending. 3. Certain items of immovable properties which were attached before judgment on 511952 in O.S. 42 of 1951 are now sought to be proceeded against in execution of the decree in the Sub Court, Meenachil. The revision petitioner preferred the claim or objection to attachment based on Ex. XI a sale deed in his favour executed on 22 41950 by the judgment-debtor. It was this claim or objection to attachment that was refused to be investigated under 0.21 R.58 by the learned Sub Judge, for the reason already mentioned. 4. The question to be decided is whether the Meenachil Sub Court which is empowered to execute the decree under S.45C (4) of the Banking Companies Act, 1949 has jurisdiction to entertain and dispose of the claim petition or objection to attachment filed under 0.21 R.58 by the revision petitioner. We have no hesitation in holding that it has such jurisdiction disagreeing with the view taken by the learned Subordinate Judge. 5. Their Lordships of the Supreme Court in Ram Narain v. 5. B. & I Co. AIR. 1956 SC. We have no hesitation in holding that it has such jurisdiction disagreeing with the view taken by the learned Subordinate Judge. 5. Their Lordships of the Supreme Court in Ram Narain v. 5. B. & I Co. AIR. 1956 SC. 614 have held that S.45A and 45B of Part III brought in by the 1950 Act vested exclusive jurisdiction in the appropriate High Court to decide all claims by or against a Banking Company relating to or arising in the course of winding up. But S.45A and 45B of Part III-A substituted by 1953 Act are far more comprehensive and vest not merely exclusive jurisdiction but specifically provided for the over-riding effect of other provisions also. In the case before us we are concerned with S.45A, 45B and 45C of the Part III-A substituted by the Bank-ink Companies (Amendment) Act 1953. S.45C is as follows: "45C. (1) Where a winding up order is made or has been made in respect of a banking company, no suit or other legal proceeding, whether civil or criminal, in respect of which the High Court has jurisdiction under this Act and which is pending in any other court immediately before the commencement of the Banking Companies (Amendment) Act, 1953, or the date of the order for the winding up of the banking company, whichever is later, shall be proceeded with except in the manner hereinafter provided. (2) The official liquidator shall, within three months from the date of the winding up order of the commencement of the Banking Companies (Amendment) Act, 1953, whichever is later, or such further time as the High Court may allow, submit to the High Court a report containing a list of all such pending proceedings together with particulars thereof. (3) On receipt of a report under sub-section (2), the High Court may, if it so thinks fit, give the parties concerned an opportunity to show cause why the proceedings should not be transferred to itself and after making an inquiry in such manner as may be provided by rules made under S.45D, it shall make such order as it deems fit transferring to itself all or such of the pending proceedings as may be specified in the order and such proceedings shall thereafter be disposed of by the High Court. 3 (4) If any proceeding pending in a court is not so transferred to the High Court under Sub-section (3), such proceedings shall be continued in the court in which the proceeding was pending. (5) Nothing in this section shall apply to any proceeding pending in appeal before the Supreme Court or a High Court." S. 45B of the Banking Companies Act is as follows: "The High Court shall, save as otherwise expressly provided in S.45C, have exclusive jurisdiction to entertain and decide any claim made by or against a banking company which is being wound up (including claims by or against any or its branches in India) or any application made under S.391 of the Companies Act, 1958, by or in respect of a banking company or any question or priorities or any other question whatsoever, whether of law or fact, which may relate to or arise in the course of the winding up of a banking company, whether such claim or question has arisen or arises or such application has been made or is made before or after the date of the order for the winding up of the banking company or before or after the commencement of the Banking Companies (Amendment) Act, 1953". From the above it is seen that S.45B is subject to the provisions under S.45C of the Banking Companies Act. In the decision of the Supreme Court above referred to their Lordships observed thus: "Having regard to all the above considerations and wide and comprehensive language of S.45A and 45B of the Banking Companies Act we are cleat that a proceeding to execute the decree obtained by the appellant from the Tribunal against the Bank in Case No.1 of 1952 and all other incidental matters arising therefrom such as attachment and so forth are matters within the exclusive jurisdiction of the Punjab High Court subject to the provisions of S.45C of the Banking Companies Act as regards pending matters." It was further observed thus: " S.45C definitely imposes a power on any pending matter in any other court being proceeded with except in the manner provided therein. The jurisdiction of that other court to proceed with a pending proceeding is made to depend on the fact that its pendency is brought to the notice of the appropriate High Court and its decision, express or implied, to leave it out without transferring it to itself." 6. In the case before us in view of the report of the Official Liquidator there is at least an implied decision on the part of this Court to leave the execution proceedings to be carried on in the Sub Judge's Court, Meenachil under S.45C (4) of the Banking Companies Act, 1949. Then the only question to be decided is whether a claim petition or objection to an attachment contemplated by 0.21 R.58 CPC. is not within the jurisdiction of the court in which the execution proceedings are pending. 0.21 R.58 of the Code of Civil Procedure confers jurisdiction only on the execution court to decide any claim or objection to an attachment in a summary manner and the decision is subject to the result of a suit under 0.21 R.63 of the Code of Civil Procedure. The revision petitioner on the basis of the claim petition wants the execution court to declare that the property attached before judgment and sought to be proceeded against in execution of the decree as the judgment-debtor's property is not the property of the judgment-debtor. A court invested with jurisdiction under S.45C (4) of the Banking Companies Act 1949 to execute a decree must necessarily decide this question also as it is a necessary step for the effective execution of the decree. If the judgment-debtor under the decree which is being executed by the Subordinate Court by virtue of S.45C (4) objects to the execution of the decree on the ground that the execution application is barred by limitation or on the ground that there is satisfaction of the decree under 0.21 R.2 CPC. or that the property attached is not saleable in execution of the decree or that the attachment is invalid, it is not open to the execution court to direct the judgment-debtor to move for relief in the High Court on the ground that the jurisdiction to decide such matters is exclusively within the jurisdiction of the High Court. The jurisdiction of the execution court to decide such objections raised by the judgment-debtor cannot be doubted. The jurisdiction of the execution court to decide such objections raised by the judgment-debtor cannot be doubted. A claim or objection to attachment is in substance an objection to the attachment at the instance of a third party and the disposal of such claim petition in a summary manner is only incidental to the execution proceedings. An objection to attachment or a claim petition within the meaning of 0.21 R.58 CPC. is in the nature of a defensive proceeding though not strictly so called by a stranger. In Mt. Zamrut v. Peoples Bank AIR. 1936 Peshawar 185, Middleton J. C. pointed out that in a case where the decree-holder who set the law in motion the position of a claimant who intervenes in an execution is analogous to that of a defendant in a suit. The learned judge observed with reference to S.171 of the Indian Companies Act thus: "It appears to me to be most inequitable that a company in liquidation should institute execution proceedings and rely upon S.171 of the Companies Act to debar persons from defending their property in those execution proceedings." The same principle must apply to the case before us. If the contention advanced by the learned advocate appearing for the official liquidator is accepted it means that the objection to every step in execution of a decree has to, be decided only by the High Court under S.45B of the Banking Companies Act. This could not have been the intention of the legislature in enacting S.45C(4) which is an exception to S.45B. The decision in Dhakuria Banking Cooperation Ltd., v. Sm. Surabala Debi AIR. 1953 Calcutta 610 on which much reliance was placed by the learned counsel for the liquidator cannot govern the case before us as it involved only the interpretation of the provisions of the Banking Companies Act 1949 before its amendment in 1953. We do not therefore think it necessary to decide the applicability of the said decision to the case before us which has to be decided in accordance with the provisions introduced by the 1953 amendment. 7. It does not appear from Comrade Bank Ltd., v. Jyoti Bala Dassi AIR. We do not therefore think it necessary to decide the applicability of the said decision to the case before us which has to be decided in accordance with the provisions introduced by the 1953 amendment. 7. It does not appear from Comrade Bank Ltd., v. Jyoti Bala Dassi AIR. 1962 Calcutta 86 relied on by the court below in support of its conclusion, that there was a report to the High Court by the Official Liquidator under S.45C (2) and a decision by the High Court for the continuance of the execution proceedings under S.45C (3) of the Banking Companies Act, 1949, in the subordinate court when the petition under O.21 R.58 CPC. was filed. The said decision proceeded on an interpretation of only S.45B without any reference to S.45C of the Banking Companies Act, 1949. The said decision cannot therefore apply to the facts of the case before us. 8. In the result we are of the view that the execution court has got jurisdiction to dispose of the petition filed under O.21 R.58 CPC. by the revision petitioner. We therefore set aside the order of the court below and allow the revision petition and direct the Subordinate Judge's Kottayam which is the successor court to take back the petition filed under O.21, R.58 CPC. to his file and dispose of the same in accordance with law. The revision petitioner will have his costs from the assets of the Bank in the hands of the Official Liquidator. Allowed.