New Shree Durga Vastra Bhandar v. Tarlok Nath Company
1989-11-29
G.D.DUBE, N.N.MITHAL
body1989
DigiLaw.ai
JUDGMENT G. D. Dubey, J. 1. This appeal has been preferred by the defendant against the judgment and order dated 31-7-89 passed by the First Additional Civil Judge, Kanpur asking the appellant to furnish security of Rs. 1,70,000/- by 5th of August, 1989, otherwise his property in his shop shall be attached. 2. The plaintiff had filed this suit in the lower court for realisation of Rs. 1,70,000/- from the defendant. He had moved a petition under Order 38 Rule 5 of the Code of Civil Procedure (referred to as Code for brevity). The plaintiff had urged that in order to obstruct and delay execution of decree that may be passed against him the defendant-appellant is disposing of the property in his shop in hot haste and even at a low price. On these grounds he had prayed that the cloths, furniture lying in shop no. 30 Aminabad, Lucknow styled as New Shree Durga Vastra Bhandar and cash if any in the till and the tenancy/ownership right in aforesaid shop be attached. The defendant-appellant had objected against this petition. He had alleged that he had a good running business of Sarees. He is a wholeseller and is selling his goods on profits. 3. The lower court considered the matter and by the impugned order came to the conclusion that defendant had failed to prove that he has sufficient means. On this ground the court had passed the above mentioned order. 4. At the very admission stage the parties had exchanged their affidavits with annexures of relevant documents filed before the courts and also relevant papers for consideration of this appeal; hence we are disposing it on merit. On a reading of the impugned order we are constrained to observe that judgment of the court consists merely in the narration of the facts alleged by the parties or contention raised by them but the consideration of the material placed on record and the reasons which impelled the court to arrive at the decision it has reached is totally wanting. It is indeed a wise policy to read the provision of law under which the proceeding has been initiated and we think the courts below would always find themselves on sounder footing if they do so.
It is indeed a wise policy to read the provision of law under which the proceeding has been initiated and we think the courts below would always find themselves on sounder footing if they do so. In, the instant case the order just narrates the rival cases of the parties and only in penultimate paragraph some time appears to have been spent (we refrain to say devoted) in considering the case relating to attachment before judgment. Unfortunately, even in doing so it has committed the fatal mistake of putting the burden on the defendant and almost exhonerating the plaintiff from establishing his case as to why an order of attachment be issued. 6-A. It surprises us that even in the matter of quoting the decision sufficient care has not been shown. For example one case is quoted as AIR 1982 page 990 without specifying the court whose decision it was. There is thus no indication if the case was decided by this High Court or by some other High Court of the country. At least in the matter of citing the case law the court ought to be careful so that those who happen read it may be able to conveniently lay their hands on it. 5. It has been contended on behalf of the appellant that the lower court has not satisfied itself about the necessary ingredients of Order 38 rule 5 of the Code. IT was urged that if any such order was passed then that is not sustainable in the eyes of the law. 6. Learned counsel for the respondent drew our attention to Annexures "RA-2" and "RA-3" to the rejoinder-affidavit showing that in another transaction with M/s. Hari Kishan Das Phoolchand the defendant had agreed to pay the dues at the rate of Rs. 500/- per mensum. The amount due was only Rs. 15,056/-. This cannot be a consideration for issuing an order under Order 38 Rule 5 of the Code. The language of Order 38 Rule 5 is clear and plainly spells the requirement before any attachment before judgment can be made by a court.
500/- per mensum. The amount due was only Rs. 15,056/-. This cannot be a consideration for issuing an order under Order 38 Rule 5 of the Code. The language of Order 38 Rule 5 is clear and plainly spells the requirement before any attachment before judgment can be made by a court. Order 38 Rule 5 of the Code reads as under :- (1) 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- (a) is about to dispose of the whole or any part of his property, or (b) 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 suit 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. (2) The plaintiff shall, unless the Court otherwise directs, specify the property required to be attached and the estimated value thereof. (3) The Court may also in the order direct the conditional attachment of the whole or any portion of the property so specified. (4) If an order of attachment is made without complying with the provisions of sub-rule (1) of this rule, such attachment shall be void. 7. In a catena of cases it has been observed that the provisions of rule 5 of Order 38 are extraordinary and should be used sparingly. IN V. K. Natraja Gounder v. S. A. Bangaru Reddiar, AIR 1965 Madras 212 a Single Judge of the Madras High Court had observed that the remedy of attachment before the judgment is quite extra-ordinary. If granted it casts an obligation on the party against whom it is made, even before it is heard in the defence to the suit.
IN V. K. Natraja Gounder v. S. A. Bangaru Reddiar, AIR 1965 Madras 212 a Single Judge of the Madras High Court had observed that the remedy of attachment before the judgment is quite extra-ordinary. If granted it casts an obligation on the party against whom it is made, even before it is heard in the defence to the suit. The Madras High Court therefore, cautioned the Courts exercising their jurisdiction under Order 38 rule 5 of the Code to act with utmost circumspection and with maximum care and caution before issuing such an order to avoid becoming a weapon of opression in hands of unscrupulous plaintiff. This case law had explained the necessary facts to be proved. The High Court had also stated that it is incumbent upon the plaintiff to state the ground on which he entertained the belief or apprehension that defendant would dispose of or remove the property and also they give the source of information and belief in the matter. It further stated that a verbatim reproduction of the provisions of the Code in the affidavit in support of the application, or a mechanical repetition of the language of the Code without an iota or substratum of truth underlying the allegation, is merely colourable and constitutes an abuse of process of Court. It was impressed upon the Courts that it must insist upon strict proof of the said allegations. This case law, therefore, shows that the initial burden lies upon the plaintiff to satisfy the Court that there is any justification to exercise the extraordinary procedure laid down in Order 38 rule 5 of the Code. 10A. IN Bishambhar Nath v. Suraj Kali, 1959 ALJ 313 also a Division Bench of this Court considered the provisions of Order 38 rule 5 of the Code. It had laid down the guidelines on page 316 for involving the aid of the said rule or the provision of injunction contained in Order 39 rule 1 of the Code. The Court had laid down the necessary essentials which must be satisfied before the attachment before judgment or injunction orders should be passed. 8. The next case law relied upon by the learned counsel is Premraj Mundra v. Md. Mareck Gazi, AIR 1951 Cal. 156 .
The Court had laid down the necessary essentials which must be satisfied before the attachment before judgment or injunction orders should be passed. 8. The next case law relied upon by the learned counsel is Premraj Mundra v. Md. Mareck Gazi, AIR 1951 Cal. 156 . In this case also it was observed that before an order of attachment before the judgment can be made the court must be satisfied by affidavit or otherwise about the intention of the defendant to obstruct or delay the execution of the decree. In this case the learned single Judge of Calcutta High Court had considered the law on the subject from a period under the old code, prior to 1908 (after the present Code was enacted) to the year 1951. The learned Judge had considered the laws laid down by various High Courts i.e. Calcutta, Patna, Lahore, Bombay wherein they had reiterated that the Courts must be very cautious in dealing the matter under Order 38 rule 5. It would be worthwhile to quote the words of Garta C.J. in Shoshee Shekhoreswar Roy v. Haro Gobind Bose, 13 CLR 536, quoted in AIR 1951 Cal. 156 , Supra. It was a case under section 483 of the old Code which corresponds to Order 38 rule 5 of the present Code. The observations were as under : "We consider on the contrary that there was no ground whatever for the application. We quite agree with the Bombay High Court that the powers given to the Court under this section should be exercised sparingly and with the utmost caution. A Civil Court should be thoroughly satisfied before it proceeds under that section, that the defendant is really disposing of his property with intent to obstruct or delay the execution of any decree that may be passed against him. We find here not the slightest pretence for any such supposition......what possible reason have we for supposing that the defendant is doing this for the purpose of obstructing or delaying the execution of any decree that may be passed against him ? " In Palghar Rolling Mills Pvt. Ltd. v. Visveryarya Iron and Steel Ltd., AIR 1985 Karnatak 282, the effect of the order passed under Order 38 Rule 5 without considering the requirements of sub-rule (1) of rule 5 was considered.
" In Palghar Rolling Mills Pvt. Ltd. v. Visveryarya Iron and Steel Ltd., AIR 1985 Karnatak 282, the effect of the order passed under Order 38 Rule 5 without considering the requirements of sub-rule (1) of rule 5 was considered. It was held by Kulkarni, J. that under sub-rule (4) of rule 5 of Order 38 (added by Amendment Act of 1976) without fulfilling the requirement of sub-rule (1) makes the order of attachment void. 9. Keeping in view the above facts and the laws laid down from time to time by various High Courts of this country it is well settled that before exercising the extra ordinary jurisdiction the court must be satisfied of the contention that the defendant has any intention to obstruct or delay the execution of decree that may be passed against him and in furtherance of that intention he is disposing of his whole or any part of the property or is about to remove the whole or a part of his property from local limits of the jurisdiction of the court. Lower Court has not given any findings on any one of those counts as to show that it had applied its mind in the matter. The burden did not lay upon the defendant to show that he had sufficient means to satisfy the decree. Even if he has no means at all at the time of the passing of the order any attachment before judgment could not be done unless the requirements of sub-rule (1) of Rule 5 of Order 38 of the Code were satisfied. The court was also required to consider whether the allegation of the plaintiff that the defendant was selling his goods at low price has any substance. He was also required to find out whether the selling of the goods in the shop were with intention to dispose of the whole property in the shop. This was very important question to be considered where the appellant is stating that the sale transaction in his shop are for profit and in the usual course of business. The lower court had not considered whether in the circumstances of the case it is desirable to attach the property in the shop or to call a huge security i.e. Rs. 1,70,000/- when the defendant is challenging the very dues against him. 10.
The lower court had not considered whether in the circumstances of the case it is desirable to attach the property in the shop or to call a huge security i.e. Rs. 1,70,000/- when the defendant is challenging the very dues against him. 10. IN the instant case, the plaintiff had simply reproduced the language of Order 38 Rule 5 of the Code in his petition. Nothing was shown as to from what source the plaintiff came to believe that the defendant has an intention to obstruct or delay the execution of any decree that may be passed against him. There is also no indication as to from which source he came to the conclusion that the defendant is selling the goods of his shop with an intention to dispose it of. IN absence of such an evidence and particularly the disclosure of the source from which the plaintiff got the knowledge about the intention of the defendant, the attachment before judgment could not be done nor any security could be demanded from the defendant. In view of what we have said, we find that the impugned order cannot be sustained and must be set aside. Accordingly the appeal is allowed and the application for attachment before judgment moved by the plaintiff-respondent be dismissed. This order, however, may not come in the way of the plaintiff if he can satisfy the court on fresh grounds that an order of attachment before judgment should be passed against the appellant. There will be no order as to costs in the appeal.