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1986 DIGILAW 407 (KER)

SHALIMAR ROPE WORKS LTD. v. N. C. JOHN & SONS LTD.

1986-10-24

SHAMSUDDIN, U.L.BHAT

body1986
Judgment :- Bhat, J Respondent herein filed a suit against the appellant herein for recovery of Rs. 3,45,650/-with costs. He also filed I.A. 536/1986 under Rule 5 Order XXXVIII C.P.C. seeking attachment before judgment of the movable articles described in the schedule and also seeking a conditional order of attachment. Learned Subordinate Judge ordered notice directing the appellant to show cause why he should not be called upon to furnish security and also passed an order of conditional attachment. It appears, certain articles were, as a matter of fact attached and removed from that custody of the appellant. At that stage, appellant appeared before the learned Subordinate Judge and filed objections 10 I.A. 536/1986. Learned Subordinate Judge allowed I.A. 536/1986 confirming the conditional order of attachment mainly on the ground that in a case where notice has been issued and a conditional order of attachment has been granted, the defendant has no right to appear and show cause against the relief claimed. It is this order which is now challenged. 2. We are not concerned with the merits of the contentious of either side since merits were not gone into by the learned Subordinate Judge. We are concerned only with the refusal of the learned Subordinate Judge to go into the contentions raised by the appellant against the conditional order of attachment and in response to the show cause notice. 3. Order XXXVIII C.P.C. deals with arrest and attachment before judgment. Rule 5 states, inter alia, that where, at any stage of a suit, the Court is satisfied, by affidavit or otherwise, that the defendant, with intent to obstruct or delay the execution of any decree that may be passed against him, is about to dispose of the whole or any part of his property, or is about to remove the whole or any part of his property from the local limits of the jurisdiction of the Court, the Court may direct the defendant, within a time to be fixed by it, either to furnish security, in such sum as may be specified in the order, to produce and place at the disposal of the Court, when required, the said property or the value of the same, or such portion thereof as may be sufficient to satisfy the decree, or to appear and show cause why he should not furnish security. 4. 4. Sub-rule (3) states that the Court may also in the order direct the conditional attachment of the whole or any portion of the property so specified. 5. Rule 6 states that where the defendant fails to show cause why he should not furnish security, or fails to furnish the security required, within the time fixed by the Court, the Court may order that the property specified, or such portion thereof as appears sufficient of to satisfy any decree which may be passed in the suit, be attached. Sub-rule (2) states that where the defendant shows such cause or furnishes the required security and the property specified or any portion of it has been attached, the Court shall order the attachment to be withdrawn, or make such other order as it thinks fit. Rule 9 states that where an order is made for attachment before judgment, the Court shall order the attachment to be withdrawn, when the defendant furnishes the security required, together with security for the costs of the attachment or when the suit is dismissed. 6. Rule 5 intends to protect the interests of a plaintiff in a suit, where it is apprehended that the defendant with intent to obstruct or delay the execution of any future decree, seeks to shield his property from court process. In such a case the Court may direct the defendant to furnish security in such sum as may be specified, to produce the property or the value of the same, when required, or to appear and show cause why he should not furnish security. The order to be passed under Rule 5 gives an option to the defendant. The defendant may either furnish security to produce the property or value of the same, when required or to appear and show cause why he should not furnish security. If the defendant has no objection to furnish security, it is certainly open to him to do so without contesting the application. If he has any objection to furnish security, it is open to him to show cause why he should not furnish security. This would make it clear that the final order to be passed by be Court is to be passed only on hearing the defendant, if he chooses to urge contentions before the Court. 7. The law also takes notice of extra-ordinary situations where urgent or immediate action is deemed necessary. This would make it clear that the final order to be passed by be Court is to be passed only on hearing the defendant, if he chooses to urge contentions before the Court. 7. The law also takes notice of extra-ordinary situations where urgent or immediate action is deemed necessary. That is why sub-rule (3) of Rule 5 provides that the Court may also direct conditional attachment of the property. There may be cases where the Court is satisfied that if the Court waits for the defendant to furnish security or to show cause, the property may disappear in the meanwhile. In such or similar circumstances, the Court is empowered to direct conditional attachment. In other words, the Court can secure attachment of the property pending furnishing of security or appearance of the defendant, in case he desires to show cause why he should not furnish security. The fact that the Court passes a conditional order of attachment afros not mean that the requirement of sub-rule (1) of Rule 5 is take a away. Nor does it mean that the defendant loses his right to show cause why he should not furnish security. It cannot be said that Rule 6 contemplates any different situation. It specifically states that where the defendant fails to show cause or fails to furnish security required, the Court may order attachment of the property and where the defendant shows cause or furnishes security, tae Court shall order attachment to be withdrawn. This provision will apply even if no conditional order of attachment is passed under sub-rule (3) of Rule 5 or even if such a conditional order as contemplated is passed. In one of the two circumstances, the Court can pass an order of the nature contemplated in sub-rule (1) of Rule 6, that is, where the defendant either fails to show cause or fails to furnish security required. As we have already pointed out, it is always open to the defendant to furnish security required without proceeding to show cause. However, if he desires to oppose the claim, it is open to him to show cause. He has a right to show cause. The Court has to consider the cause and pass final orders. If the decision is in favour of the defendant, an order as center plated in sub-rule (2) of Rule 6 has to be issued. However, if he desires to oppose the claim, it is open to him to show cause. He has a right to show cause. The Court has to consider the cause and pass final orders. If the decision is in favour of the defendant, an order as center plated in sub-rule (2) of Rule 6 has to be issued. If the conclusion is against the defendant, an order of the nature contemplated in sub-rule (1) of Rule 6 would follow. 8. What we have indicated here is nothing different from what has been indicated by this Court in Rai Premchand & Others v. P. K. Ahammed & Co. (1982 K.L.T. 294), Until v. Vijayan (1983 K.L.T. 927) and Moidu v. Canara Bank (1986 K.L.T. 1031). We do not understand anyone of these decisions to lay down that where a conditional order of attachment has been passed, she defendant has ko right to appear and show cause. It is unfortunate that the learned Subordinate Judge has misconstrued these decisions and the plain tenor of the provisions in the rules. In the result, we set aside the impugned order and remand LA. 536/1986 for fresh disposal in accordance with law. The learned Subordinate Judge will take up the I.A. enquiry at the earliest and pass final orders without any further delay. A copy of this judgment and the records will be scout forthwith to the Subordinate Judge. Issue carbon copies to both sides on usual terms.