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Karnataka High Court · body

1993 DIGILAW 85 (KAR)

V. S. PRABHU v. R. D. MUJUMDAR

1993-04-02

K.H.N.KURANGA

body1993
K. H. N. KURANGA, J. ( 1 ) THE PETITIONERS ARE THE JUDGMENT-DEBTORS 2 AND 3; RESPONDENT NO. 1 IS THE judgment-DEBTOR NO. 1; RESPONDENT NO. 2 IS THE DECREE HOLDER AND RESPONDENT no. 3 IS THE GARNISHEE IN EXECUTION CASE NO. 82 OF 1988 ON THE FILE OF THE CIVIL judge, MANGALORE, D. K. THE PETITIONERS HAVE CHALLENGED IN THIS PETITION THE order DATED 21-11-1988 PASSED BY THE II ADDITIONAL CIVIL JUDGE, MANGALORE, d. K. , HOLDING THAT THE GARNISHEE IS ENTITLED TO BE PAID HIS CLAIM, AS PER EXT. D. 1, the DECREE, FROM OUT OF THE SALE PROCEEDS. ( 2 ) FEW FACTS NECESSARY FOR THE DISPOSAL OF THIS PETITION ARE AS FOLLOWS: THE DECREE HOLDER-BANK OBTAINED A DECREE AGAINST THE JUDGMENT-DEBTORS FOR a SUM OF RS. 4,49,007-16 PS. PERSONALLY AGAINST THEM AND ALSO BY SALE OF THE hypothecated TRUCK. THE DECREE HOLDER REQUESTED THE COURT TO SEIZE THE hypothecated VEHICLE AND TO SELL THE SAME IN PUBLIC AUCTION AND TO PAY THE SALE proceeds TO THE DECREE HOLDER. THE CLAIM IN THE EXECUTION PETITION IS RS. 6,11,191-80 PS. WITH INTEREST. ( 3 ) THE COURT BELOW PASSED AN ORDER FOR SEIZURE OF THE TRUCK AND, AT THAT TIME, THE VEHICLE WAS IN POSSESSION OF THE GARNISHEE. THE GARNISHEE CLAIMED LIEN OVER the HYPOTHECATED TRUCK ON THE GROUND THAT SOME AMOUNT WERE DUE TOWARDS THE repair CHARGES OF THE VEHICLE DONE BY HIM. THE VEHICLE WAS SEIZED AND SOLD FOR A sum OF RS. 75,500/- THROUGH THE PROCESS OF THE COURT LEAVING OPEN THE CLAIM OF the GARNISHEE. THE AMOUNT WAS KEPT IN THE COURT DEPOSIT. ( 4 ) THE GARNISHEE HAD FILED THE STATEMENT OF OBJECTION CLAIMING THAT THE TRUCK BEARING NO. CNG 4950 WAS KEPT WITH HIM FOR EFFECTING REPAIRS AND THAT THE TOTAL amount DUE TO HIM TOWARDS THE REPAIR CHARGES WAS RS. 37,332. 48 PS. WITH FUTURE interest AT THE RATE OF 18%. HE ALSO CONTENDED THAT HE HAD OBTAINED A DECREE IN o. S. NO. 90 OF 1987 BY SPENDING RS. 5,240/- TOWARDS THE SUIT COST. HE FURTHER contended THAT THE TRUCK WAS LYING IN HIS PREMISES AND THE OWNER OF THE TRUCK IS liable TO PAY RENT OF RS. 300/- PER MONTH FROM 1-10-1984 TILL IT WAS SEIZED IN pursuance OF THE COURT ORDER. THUS, THE GARNISHEE CLAIMED THE LIEN OVER THE truck AND THE AMOUNTS REALISED BY SELLING THE SAME. HE FURTHER contended THAT THE TRUCK WAS LYING IN HIS PREMISES AND THE OWNER OF THE TRUCK IS liable TO PAY RENT OF RS. 300/- PER MONTH FROM 1-10-1984 TILL IT WAS SEIZED IN pursuance OF THE COURT ORDER. THUS, THE GARNISHEE CLAIMED THE LIEN OVER THE truck AND THE AMOUNTS REALISED BY SELLING THE SAME. HE CONTENDED THAT HIS LIEN is THE FIRST CHARGE ON THAT AMOUNT AND IT SHOULD BE PAID FIRST OUT OF THE SALE proceeds AND THE BALANCE MAY BE PAID TO THE DECREE HOLDER. ( 5 ) IN SUPPORT OF HIS CLAIM THE GARNISHEE HAS EXAMINED ONE OF THE PARTNERS OF THE GARNISHEE FIRM AND GOT MARKED THE DOCUMENTS EXTS. D. 1 TO D. 15. NEITHER the DECREE HOLDER NOR THE JUDGMENT-DEBTORS ADDUCED ANY EVIDENCE. ( 6 ) THE COURT BELOW, AFTER HEARING THE ARGUMENTS AND AFTER CONSIDERING THE EVIDENCE PRODUCED BY THE GARNISHEE HELD THAT THE GARNISHEE IS ENTITLED TO BE paid HIS CLAIM, AS PER EXT. D. 1, THE DECREE, FROM OUT OF THE SALE PROCEEDS OF THE truck; THE BALANCE SHALL BE PAID TO THE DECREE HOLDER IN PART SATISFACTION OF THE decree, BY ITS ORDER DATED 21st NOVEMBER, 1988. ( 7 ) HEARD THE LEARNED COUNSEL APPEARING FOR THE PETITIONERS AND RESPONDENTS AND PERUSED THE ORDER PASSED BY THE COURT BELOW. THE LEARNED COUNSEL FOR THE PETITIONERS CONTENDED THAT THE DECREE holder-BANK BEING THE SECURED CREDITOR, IT WILL HAVE PRIORITY OVER THE CLAIM OF the GARNISHEE. THEREFORE, THE ORDER PASSED BY THE COURT BELOW IS NOT CORRECT. HE further CONTENDED THAT THE GARNISHEE LOST POSSESSION OF THE VEHICLE WHEN THE same WAS SEIZED IN PURSUANCE OF THE ORDER PASSED BY THE COURT BELOW, AND, therefore, THE LIEN WHICH THE GARNISHEE HAD ON THE VEHICLE WAS LOST AND, therefore, HE CANNOT CLAIM ANY AMOUNT TOWARDS THE REPAIR CHARGES. HE ALSO relied UPON A DECISION IN SURYA INVESTMENT COMPANY V STATE TRADING corporation OF INDIA LTD. , AIR 1987 CALCUTTA 46. ( 8 ) THE LEARNED COUNSEL APPEARING FOR THE DECREE HOLDER-BANK ARGUED THAT THE DECREE HOLDER DID RAISE THE OBJECTION BEFORE THE COURT BELOW FOR THE CLAIM OF the GARNISHEE. HE ALSO relied UPON A DECISION IN SURYA INVESTMENT COMPANY V STATE TRADING corporation OF INDIA LTD. , AIR 1987 CALCUTTA 46. ( 8 ) THE LEARNED COUNSEL APPEARING FOR THE DECREE HOLDER-BANK ARGUED THAT THE DECREE HOLDER DID RAISE THE OBJECTION BEFORE THE COURT BELOW FOR THE CLAIM OF the GARNISHEE. HE FURTHER CONTENDED THAT THE VEHICLE WAS ALREADY HYPOTHECATED to THE DECREE HOLDER-BANK, AND, THEREFORE, THE PAYMENT OF MONEY, IF ANY, TO THE garnishee IS SUBJECT TO HYPOTHECATION, AND, THEREFORE, THE IMPUGNED ORDER passed BY THE COURT BELOW, IN THIS CASE, IS ILLEGAL. ( 9 ) THE LEARNED COUNSEL APPEARING FOR THE GARNISHEE CONTENDED THAT IN VIEW OF SECTION 170 OF THE INDIAN CONTRACT ACT, 1872 ('the ACT'), THE GARNISHEE HAS, IN the ABSENCE OF A CONTRACT TO THE CONTRARY, A RIGHT TO RETAIN SUCH GOODS UNTIL HE receives DUE REMUNERATION FOR THE SERVICES HE HAS RENDERED IN RESPECT OF THEM. HE SUBMITTED THAT IN VIEW OF THIS, THE GARNISHEE HAS A LIEN OVER THE AMOUNT realised BY SELLING THE VEHICLE IN THIS CASE, AND, THEREFORE, THE ORDER PASSED BY THE court BELOW IS CORRECT. HE FURTHER SUBMITTED THAT HE LOST POSSESSION OF THE vehicle BECAUSE OF THE ORDER PASSED BY THE COURT BELOW FOR SEIZURE AND SALE OF the VEHICLE AND HE HAD NOT PARTED WITH POSSESSION OF THE VEHICLE VOLUNTARILY AND the SEIZURE OF THE VEHICLE WAS SUBJECT TO HIS LIEN. THE LEARNED COUNSEL FURTHER argued THAT HE HAS ALSO OBTAINED A DECREE IN O. S. NO. 90 OF 1987 FOR THE AMOUNT due TO HIM TOWARDS THE REPAIR CHARGES OF THE VEHICLE AND, THEREFORE, HE IS entitled TO BE PAID THE AMOUNT REALISED BY SELLING THE VEHICLES. HE ALSO ARGUED that THE PETITIONERS-SURETIES COME INTO PICTURE ONLY WHEN THE AMOUNT IS NOT realised FULLY FROM THE PRINCIPAL DEBTOR, AND, THEREFORE, THEY CANNOT QUESTION the IMPUGNED ORDER BEFORE THIS HON'ble COURT; IT IS THE PRINCIPAL DEBTOR OR THE decree HOLDER-BANK ARE THE PERSONS WHO ARE AGGRIEVED OF THE IMPUGNED ORDER and NOT THE PETITIONERS-SURETIES. SINCE THEY HAVE NOT FILED ANY REVISION BEFORE this HON'ble COURT, THE REVISION PETITION FILED BY THE PETITIONERS IS LIABLE TO BE dismissed. ( 10 ) THE VEHICLE, IN QUESTION, WAS SEIZED AND SOLD IN PURSUANCE OF THE ORDER PASSED BY THE COURT BELOW. SINCE THEY HAVE NOT FILED ANY REVISION BEFORE this HON'ble COURT, THE REVISION PETITION FILED BY THE PETITIONERS IS LIABLE TO BE dismissed. ( 10 ) THE VEHICLE, IN QUESTION, WAS SEIZED AND SOLD IN PURSUANCE OF THE ORDER PASSED BY THE COURT BELOW. THE GARNISHEE DID NOT VOLUNTARILY PART WITH THE possession OF THE VEHICLE; HE PARTED WITH THE VEHICLE SUBJECT TO HIS LIEN ON THE amount TO BE REALISED BY SELLING THE VEHICLE. IN VIEW OF THIS, THE CONTENTION OF the LEARNED COUNSEL APPEARING FOR THE PETITIONER, THAT THE GARNISHEE LOST HIS LIEN over THE VEHICLE WHEN THE VEHICLE WAS SEIZED IN PURSUANCE OF THE ORDER OF THE court BELOW, THEREFORE, HE IS NOT ENTITLED FOR THE RELIEF CLAIMED, CANNOT BE accepted AND THE DECISION REPORTED IN AIR 1987 CAL. 46 , SURYA INVESTMENT company's CASE, REFERRED TO ABOVE, IS NOT APPLICABLE TO THE FACTS OF THE PRESENT case. ( 11 ) THE LEARNED COUNSEL APPEARING FOR THE GARNISHEE CONTENDED THAT HE HAS GOT LIEN ON THE VEHICLE IN QUESTION. ( 12 ) IN THE CASE OF TAPPENDEN (TRADING AS ENGLISH AND AMERICAN AUTOS) V ARTUS AND ANOTHER, REPORTED IN (1963)3 ALL E. R. 213, A MOTOR DEALER, WHO WAS ALSO himself A MOTOR MECHANIC, AGREED TO LET A PROSPECTIVE PURCHASER ("the BAILEE") use A MOTOR VAN ON CONDITION THAT HE LICENSED AND INSURED IT, AND THE DEALER made SURE THAT THIS WAS DONE BEFORE PARTING WITH POSSESSION. THE VAN BROKE down IN USE AND THE BAILEE INSTRUCTED ANOTHER MOTOR MECHANIC ("the ARTIFICER") to TOW IT INTO HIS GARAGE AND EXECUTE THE NECESSARY REPAIRS, BUT FAILED TO PAY FOR the REPAIRS. IN AN ACTION BY THE MOTOR DEALER TO RECOVER POSSESSION OF THE VAN from THE ARTIFICER, THE COURT HELD THUS:"the ARTIFICER WAS ENTITLED TO A COMMON LAW LIEN ON THE VAN IN RESPECT OF THE repairs WHICH HE HAD EFFECTED, BECAUSE THE BAILEE, WHEN ENTRUSTING THE VAN TO the ARTIFICER, WAS LAWFULLY IN POSSESSION OF IT UNDER A CONTRACT WITH THE OWNER, the MOTOR DEALER (THE CONSIDERATION BEING THE LICENSING AND INSURING OF THE van), AND IN GIVING POSSESSION OF IT TO THE ARTIFICER FOR THE PURPOSE OF EFFECTING repairs NECESSARY TO RENDER IT ROADWORTHY THE BAILEE (NOTWITHSTANDING that THE MOTOR DEALER WAS HIMSELF A MOTOR MECHANIC) WAS ACTING WITHIN HIS authority, SINCE THE ACT WAS REASONABLY INCIDENTAL TO THE BAILEE's REASONABLE use OF THE VAN". ( 13 ) HENCE, I HOLD THAT THE GARNISHEE HAS GOT A LIEN ON THE TRUCK IN RESPECT OF THE REPAIRS WHICH HE HAD EFFECTED TO THE SAME. ( 14 ) MOREOVER, THE GARNISHEE, IN THIS CASE, HAD FILED O. S. NO. 90 OF 1987 AND OBTAINED A DECREE AND IT IS NOT A COLLUSIVE SUIT. IT IS NOT THE CASE OF THE PETITIONERS that THE TRANSACTION BETWEEN THE GARNISHEE AND THE REGISTERED OWNER OF THE vehicle LACKS BONA FIDES. ( 15 ) FURTHER, IN VIEW OF SECTION 170 OF THE CONTRACT ACT, THE GARNISHEE WILL GET PREFERENTIAL LIEN OVER THE VEHICLE UNTIL HIS REPAIR CHARGES ARE PAID. HE HAD put FORWARD HIS CLAIM BEFORE THE COURT, EVEN AT THE TIME OF SEIZURE OF THE VEHICLE from HIS CUSTODY, AND THE SEIZURE OF THE VEHICLE WAS SPECIFICALLY SUBJECT TO HIS claim. ( 16 ) IN THE CIRCUMSTANCES, THE ARGUMENT OF THE LEARNED COUNSEL FOR THE DECREE HOLDER-BANK THAT THE VEHICLE WAS ALREADY HYPOTHECATED TO THE BANK, AND, therefore, THE GARNISHEE HAS NO PREFERENTIAL CLAIM OVER THE CLAIM OF THE BANK, cannot BE ACCEPTED. ( 17 ) THE COURT BELOW, AFTER TAKING INTO CONSIDERATION THE FACTS AND CIRCUMSTANCES OF THE CASE, HAS PASSED THE IMPUGNED ORDER. THE ORDER PASSED BY the COURT BELOW, IN MY OPINION, IS CORRECT AND IT DOES NOT CALL FOR ANY interference. ( 18 ) IN THE RESULT, THE REVISION PETITION IS LIABLE TO BE DISMISSED AND THE SAMEIS ACCORDINGLY DISMISSED. --- *** --- .