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2014 DIGILAW 1440 (PNJ)

Randhir Singh & Company v. Municipal Council, Jind

2014-10-16

RAKESH KUMAR JAIN

body2014
JUDGMENT Rakesh Kumar Jain, J. - This order shall dispose off two revision petitions bearing Civil Revision No. 2591 of 2010 and Civil Revision No. 2869 of 2010. However, for the sake of convenience, the facts are extracted from Civil Revision No. 2591 of 2010. 2. In short, the Municipal Council, Jind conducted the auction for collection of octroi in the Municipal Council in which M/s Randhir Singh & Company was the highest bidder and allotted the contract for collection of octroi for the period w.e.f 01.07.1995 to 30.06.1996. 3. According to the petitioners, the Municipal Council, Jind did not provide requisite staff, roads were broken and there was a flood in the area of Municipal Council as a result of which, the contract was discontinued after four months of the agreement. It led to a dispute between the parties regarding payment of the contract money i.e. Rs. 80,11,000/-. The Civil Judge, Jind appointed the Financial Commissioner and Secretary, Government of Haryana Local Government Department as Arbitrator vide its order dated 16.07.197 in terms of Clause 26 of the agreement. The Arbitrator announced his award on 21.04.1998 and found that the petitioners were liable to pay Rs. 22,00,759.60/- i.e. towards the principal amount and Rs. 3,46,619/- towards interest for the period from 01.07.1996 to 15.05.1997 and also ordered that interest @ 18% be recovered from the petitioners from the date of award till its realization. The petitioners challenged the award by filing an application under Section 34 of the Arbitration and Conciliation Act, 1996 (for short 'the Act') which was dismissed by the Civil Judge (Sr. Division) Jind on 31.01.2006. It is stated that the appeal carried against that order was also withdrawn due to technical defect with liberty to file it again but later on it is alleged to have been dismissed. Thereafter, no further proceedings were taken in respect of the award of the Arbitrator and as such it has become final between the parties. The Municipal Council, Jind then filed an application for execution of the award dated 21.04.1998 under Order 21 Rule 11-A CPC for arrest and detention of the JDs in order to satisfy the decree. In the said application, District Judge, Jind did not issue any notice to the petitioners and passed the order dated 03.04.2010, issuing arrest warrants to the SHO, P.S City, Jind. 4. In the said application, District Judge, Jind did not issue any notice to the petitioners and passed the order dated 03.04.2010, issuing arrest warrants to the SHO, P.S City, Jind. 4. Aggrieved against the said order, the petitioners, who happened to be the partners of the firm M/s Randhir Singh & Company preferred two revision petitions, the Civil Revision No. 2591 of 2010 is filed by nine persons, whereas Civil Revision No. 2869 of 2010 is filed by two persons. 5. Learned counsel for the respondent has pointed out that the petitioners are the partners of the firm M/s Randhir Singh & Company is allegedly admitted by the petitioners themselves in para No. 4 of its grounds of Civil Revision No. 2869 of 2010, which reads as under:- "That the parties will be entitled to profits or liable for losses as the case may be as under:- 1.Randhir SinghFirst Party20% 2.Capt. Dharam SinghSecond Party15% 3.Hira SinghThird Party3% 4.Hawa SinghFourth Party5% 5.Dinesh KumarFifth Party5% 6.Baljeet SinghSixth Party5% 7.Ramesh KumarSeventh Party10% 8.Prem SinghEighth Party5% 9.Kapoor SinghNinth Party10% 10.Mohinder SinghTenth Party5% 11.Wazir SinghEleventh Party5% 12.Srinder SinghTwelevth Party10%" 6. Learned counsel for the petitioners has vehemently argued that the impugned order is patently illegal being contrary to Section 51 of the CPC which provides that in case of recovery of money, before passing an order of the detention, the judgment debtor should be given an opportunity to show cause as to why he should not be committed to prison. In the present case, no notice was given and straightaway the order was passed on the application of the respondent. The respondent has also relied upon a judgment in the case of "M/s Maruti Ltd. (in Liquidation), Chandigarh and another v. M/s Pan India Plastic Pvt. Ltd., New Delhi" AIR 1993 P&H 215 and a judgment of the Andhra Pradesh High Court in the case of "Kasi Subbaiah Mudali v. Kasi Veeraswamy Mudali and others" AIR 2002 NOC 118. Learned counsel for the respondent has submitted that the petitioners are trying to delay the payment of the decreetal amount, though a sum of Rs. 25,48,000/- has been deposited with Municipal Council, Jind but they are still liable to pay more amount on account of interest to be calculated 18% from the date of the award till the date of its realization. 25,48,000/- has been deposited with Municipal Council, Jind but they are still liable to pay more amount on account of interest to be calculated 18% from the date of the award till the date of its realization. In this regard, learned counsel for the petitioners has submitted that there is no reference of 18% future interest in the award itself, but learned counsel for the respondent has argued that 18% interest is applicable in terms of the provisions of Section 31 Clause 7 (b) of the Act. 7. I have heard learned counsel for the parties and after examining the record, am of the considered opinion that the present petitions deserves to be allowed. It is not disputed before me by counsel for the respondent that the impugned order dated 03.04.2010 was passed by the District Judge, Jind without issuing notice to the petitioners who are the partners of the firm M/s Randhir Singh & Company. It is not disputed before me by counsel for the respondent that the impugned order dated 03.04.2010 was passed by the District Judge, Jind without issuing notice to the petitioners who are the partners of the firm M/s Randhir Singh & Company. In order to appreciate the argument raised by learned counsel for the petitioners, it would be relevant to refer Section 51 of the CPC, which read thus:- "Subject to such conditions and limitations as may be prescribed, the court may, on the application of the decree-holder, order execution of the decree (a) By delivery of the property specifically decreed; (b) By attachment and sale or by sale with attachment of any property; (c) By arrest and detention in prison for such period not exceeding the period specified in section 58, where arrest and detention is permissible under that section; (d) By appointing a receiver; or (e) In such other manner as the nature of the relief granted may require : Provided that, where the decree is for the payment of money, execution by detention in prison shall not be ordered unless, after giving the judgment-debtor an opportunity showing cause why he should not be committed to prison, the Court, for reasons recorded in writing, is satisfied (a) That the judgment-debtor, with the object or effect of obstructing or delaying the execution of the decree, (i) Is likely to abscond, or leave the local limits of the jurisdiction of the court, or (ii) Has, after the institution of the suit in which the decree was passed, dishonestly transferred, concealed, or removed any part of his property, or committed any other act of bad faith in relation to his property, or (b) That the judgment-debtor has, or has since the date of the decree, the means to pay the amount of the decree or some substantial part thereof and refuses or neglects or has refused or neglected to pay the same, or (c) that the decree is for a sum for which the judgment debtor was bound in a fiduciary capacity to account. Explanation: In the calculation of the means of the judgment-debtor for the purposes of clause (b), there shall be left out of account any property which, by or under any law or custom having the force of law for the time being in force, is exempt from attachment in execution of the decree." Order 21 Rule 11-A of CPC also reads as under:- "Where an application is made for the arrest and detention in prison of the judgment debtor, it shall state, or be accompanied by an affidavit stating, the grounds on which arrest is applied for." 8. In the present case, not only the learned Court below has passed the order without issuing notice to the JDs who may be the partners of the firm but also has committed an error in passing of the order of detention without recording reasons. From the impugned order it appears that the Court made up its mind to put the petitioners behind the bars only on the ground that they had failed to make the payment of the decreetal amount, though the petitioners have showed their bonafide in depositing the payment of Rs. 25,48,000/- with respondent/Municipal Council, Jind during the pendency of the present revision petition. Had an opportunity been granted to the petitioners, they could have come forward with some explanation for not paying the amount of the decree/award to the Municipal Council/respondent or could have asked for some instalments to be made by the Court for the purpose of making payment. 9. The judgments relied upon by the learned counsel for the petitioners in this regard in the case M/s Maruti Ltd. v. M/s Pan India Plastic Pvt. Ltd. (supra) and Kasi Subbaiah Mudali v. Kasi Veeraswamy Mudali and others (supra) are applicable to the facts and circumstances of the present revision petition. 10. Thus, in view of the above, the impugned order is hereby set aside. 11. Before parting, learned counsel for the petitioners has submitted that the trial Court may be directed to recover the amount to be paid by the petitioners according to their share in the partnership firm. This direction cannot be issued by this Court but may be taken up by the petitioners when they would appear before the Court and notice is given by the Court to them on the application filed under Order 21 Rule 11-A of the CPC.