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2020 DIGILAW 138 (JK)

Tariq Ahmad Rather v. Gopi Chand Prem Kumar

2020-03-04

TASHI RABSTAN

body2020
JUDGMENT : 1. Setting-aside of Order dated 20th February 2020, passed by the court of Sub-Judge (CJM) Sopore (for brevity "Trial Court”) in an Execution Petition titled Firm Gopi Chand, Prem Kumar v. Tariq Ahmad Rather, directing detaining of petitioner in civil prison for a period of one month in execution of the decree, is implored for on the grounds mentioned in Revision Petition on hand. 1.1. It is averred in the Revision Petition on hand that in a Suit for Rendition of Accounts, a decree for payment of Rs. 1,55,84,233.30 was passed on 17th July 2019 by Trial Court in favour defendant - respondent herein 1.2. It is maintained that application for execution of decree having been filed by respondent before Trial Court did not satisfy requirements of Section 51 of the Code of Civil Procedure (CP). 1.3. Learned Trial Court is stated to have not appreciated any satisfaction that application for execution was incompetent and that no inquiry as required under Rule 40 of Order 21 CPC was held by Trial Court. 1.4. It is asserted that Trial Court did not issue any show cause notice to petitioner enabling him to explicate as to why he should not be committed to civil prison. Petitioner was got arrested by Trial Court on 14th February 2020 consequence to issuance of warrant of arrest which was issued merely because on 3rd February 2020, both petitioner and his counsel were absent in the proceedings though he had already caused his appearance before Trial Court on previous dates of hearing, i.e. 26th December 2019 and 30th December 2019. Trial Court, taking up the matter on 15th February 2020 and 18th February 2020, while petitioner was under arrest, did not hold any inquiry or receive any evidence in support of application for execution and also did not give petitioner an opportunity to show cause against detention in civil prison. 1.5. It is avowed that petitioner has not failed to satisfy the stipulation of the decree in that the decree provided payment of decretal amount in four years from the date of compromise deed, which according to respondent was entered into on 22nd January 2018. 2. I have heard learned counsel for parties and considered the matter. 3. 1.5. It is avowed that petitioner has not failed to satisfy the stipulation of the decree in that the decree provided payment of decretal amount in four years from the date of compromise deed, which according to respondent was entered into on 22nd January 2018. 2. I have heard learned counsel for parties and considered the matter. 3. According to learned counsel for petitioner impugned order passed in Execution Petition is in contradiction to provisions of Section 51 read with Rule 11-A and 37 CPC, besides provisions of Rule 40 of Order XXI CPC. 4. Per contra, Mr. N.H. Shah, learned counsel for respondent, has insisted that revision petition is not maintainable against order impugned and is liable to be dismissed. He has produced copies of certain order passed by Trial Court, which are taken on record. 4.1. A submission, made by learned counsel for respondent during course of advancement of arguments that judgement cited by Trial Court rendered in the case of M/s Pushpa Sahakari Avas Samiti Ltd. v. M/s Gangotri Sahakari Avas S. Ltd. and others, AIR 2012 SC 1788 , while passing impugned order, has significance and bearing on instant matter inasmuch as it has been observed therein that execution petition can be filed before expiry of time stipulated in compromise decree for judgement debtor to honour his obligation, though initially looks convincing yet it pales into significance owing to the discussion and reasons ingeminated hereafter, more particularly when in Pushpa Sahakari Avas Samiti Ltd. (supra), the order in execution petition was passed, the decree had become mature for execution and therefore, facts in aforesaid case are distinguishable from the case in hand. 5. While going through the file, it comes to fore that civil suit titled Tariq Ahmad Rather v. Firm Gopi Chand Prem Chand, had been filed before Trial Court on 31st December 2015. Pursuant to compromise entered into between parties, the suit of petitioner was dismissed vide order dated 22nd January 2018, against which revision petition, being CR No. 14/2018 was filed before this Court, which was disposed of vide order dated 22nd May 2019, setting-aside judgement and decree insofar as the same dismissed the suit as per compromise. Pursuant to compromise entered into between parties, the suit of petitioner was dismissed vide order dated 22nd January 2018, against which revision petition, being CR No. 14/2018 was filed before this Court, which was disposed of vide order dated 22nd May 2019, setting-aside judgement and decree insofar as the same dismissed the suit as per compromise. It was also provided by this Court that relief in favour of respondent herein would be deemed to have been granted in terms of compromise deed and award of Lok Adalat, whereunder petitioner herein was directed to pay an amount to respondent herein as per arrangement devised in compromise and that Trial Court would frame decree sheet accordingly. It was in consequence thereof, that Trial Court framed a decree, providing therein that suit was disposed of in terms of compromise dated 18th May 2017, by which petitioner herein was liable to pay aforesaid amount, which plaintiff - petitioner herein had admitted to pay to defendant -respondent herein in four years from the date of compromise deed. 6. In the present case an execution petition was filed by respondent before Trial Court on 21st December 2019. On subsequent date, i.e. 3rd December 2019, counsel for petitioner herein caused appearance before Trial Court and sought time to file Power of Attorney as also objections on behalf of judgement debtor/petitioner and execution petition was adjourned for 3rd February 2020, on which date neither petitioner nor his counsel caused appearance. In view of non-appearance of petitioner and his counsel on 3rd February 2020, Trial Court issued arrest-warrant against judgement debtor/petitioner. On 15th February 2020, as is discernible from the orders, so produced by learned counsel for respondent, petitioner was produced in custody by concerned police and petitioner was directed to be kept in judicial lockup and matter was directed to be listed on 18th February 2020. On that date as well, Trial Court directed to keep petitioner in judicial lockup. And it was on 20th February 2020 that impugned order has been passed by Trial Court directing detainment of petitioner in civil prison in execution of the decree for a period of one month. 7. Given the case set up together with submissions made by learned counsel for parties, it would be appropriate to have discourse vis-a-vis the provisions for compliance of procedure in execution matters. 7. Given the case set up together with submissions made by learned counsel for parties, it would be appropriate to have discourse vis-a-vis the provisions for compliance of procedure in execution matters. In this regard, Section 51 CPC provides that on an application of decree-holder, the Court may order execution of the decree by delivery of any property specifically decree, or by attachment and sale or by sale without attachment of any property, or by arrest and detention in prison for such period not exceeding the period specified in Section 58 CPC, where arrest and detention is permissible under the said section, or by appointing a receiver, or in such other manner as the nature of the relief granted may required. Nevertheless, proviso to Section 51 envisions that where the decree is for payment of money, execution by detention in prison shall not be ordered unless, after giving the judgement-debtor an opportunity of showing cause any he should not be committed to prison. 7.1. Again Rule 40(1) of Order XXI CPC envisages that when a judgement debtor appears before the Court in obedience to a notice or is brought before the court after being arrested in execution of a decree for payment of money, the Court shall proceed to hear decree-holder and take all such evidence as may be produced by him in support of his application for execution and shall then give judgement-debtor an opportunity of showing cause why he should not be committed to civil prison. 7.2. Sub-rule (2) of Rule 40 of Order XXI CPC, provides that pending conclusion of inquiry under sub-rule (1) the Court may, in its discretion, order judgement-debtor to be detained in the custody of an officer of the Court or release him on his furnishing security to the satisfaction of the Court for his appearance when required. 7.3. Sub-rule (3) of Rule 40 CPC envisions that upon condition of inquiry under sub-rule (1) the Court may, subject to provisions of Section 51 CPC, and to the other provisions of the Code of Civil Procedure, make an order for detaining judgement debtor in civil prison and shall in that event cause him to be arrested if he is not already under arrest. 7.4. 7.4. Proviso to sub-rule (3) of Rule 40 CPC specifically says that in order to give judgement an opportunity of satisfying the decree, the Court may, before making the order of detention, leave judgement debtor in the custody of an officer of the Court for a specified period not exceeding 15 days or release him on his furnishing security to the satisfaction of the Court for his appearance at the expiration of specified period if decree be not sooner satisfied. 7.5. It may not be out of place to mention here that judgement debtor under sub-rule (4) of Rule 40 of Order XXI CPC can be re-arrested. When the Court does not make an order of detention under sub-rule (3), it shall, under sub-rule (5) of Rule 40, disallow the application and if judgement-debtor is under arrest, direct his release. 8. In the calculation of above legal position, Section 51 CPC provides issue of notice can be dispensed with only when the court would be justified in ordering arrest of judgement-debtor in view of sub-clause (i) of Clause (a) to the Proviso of Section 51. Notice has to be issued to judgement-debtor whenever grounds for arrest of judgement-debtor would be those mentioned in sub-clause (ii) of clause (a) to Proviso of Section 51, sub-clauses (b) and (c) to the Proviso of Section 51. 8.1. The existence of circumstances justifying an order for arrest should be alleged either in execution application itself or in a separate application or affidavit which should accompany the execution application. In absence of it, the court cannot take action under Order XXI Rule 37 or issue notice to judgement-debtor. 8.2. The procedure to be followed when judgement-debtor appears in court should be according to Order XXI Rule 40, viz. the court should proceed to hear decree-holder and take all such evidence as may be produced by him in support of his application for execution, and should not commit judgement debtor to the civil prison. 8.3. It is for decree-holder to lead prima facie evidence in support of his application and where he has led no evidence, the court cannot issue an order against judgement-debtor. Mere non-payment to decree-holder when judgement-debtor came into possession of means subsequent to the date of decree will not always be sufficient for coming to conclusion that judgement-debtor refused or neglected to pay the decree-holder. 8.4. Mere non-payment to decree-holder when judgement-debtor came into possession of means subsequent to the date of decree will not always be sufficient for coming to conclusion that judgement-debtor refused or neglected to pay the decree-holder. 8.4. In absence of evidence, which could have a bearing on these considerations, the court could not have satisfied that judgement-debtor has refused or neglected to pay decretal amount within the meaning of Section 51(b) Proviso. 8.5. A court must record its reasons in writing regarding its being satisfied under Section 51 CPC, that judgement-debtor had rendered himself liable to be arrested and sent to civil jail on any of the grounds mentioned therein before directing his arrest. 8.6. In Clause (c) of Section 51 CPC, the words "for such period not exceeding the period specified in Section 58, where arrest and detention is permissible under that section". This has been done, so as to harmonise provisions of Section 51(c) with the provisions of Section 58 of the Code. 9. In Jolly George Varghese v. The Bank of Cochin, AIR 1980 SC 470 , judgement-debtors suffered a decree against them in original suit No. 57 of 1972 in a sum of Rs. 2.5 lakhs. The Bank of Cochin was decree-holder. In execution of decree a warrant for arrest and detention in civil prison was issued to Jolly appellants (Jolly George Varghese and others) under Section 51 CPC on 22nd June 1979. In addition to this process, decree-holders had proceeded against properties of judgement-debtors and, in consequence, all their immovable properties had been attached for the purpose of sale in discharge of decree debts. No investigation, however, had been made by executing court refusing the current ability of judgement-debtors to clear off debts or their mala fide refusal, if any, to discharge the debts. 9.1. The question was whether under such circumstances, personal freedom of judgement-debtors could be held in ransom until repayment of debt, and if Section 51 read with Order XXI Rule 37 C.P.C., did warrant such a step, whether the provision of law was constitutional, tested on the touchstone of fair procedure under Article 21 and in conformity with the inherent dignity of human person in the light of Article 11 of the International Covenant on Civil and Political Rights. In an appeal filed by judgement-debtors in the Supreme Court, the matter involved a profound issue of constitutional and international law and offered a challenge to nascent champions of human rights in India whose politicised pre-occupation had forsaken civil debtor whose personal liberty was imperilled by judicial process. 9.2. Krishna Iyer J. while saying thanks to Section 51 (Proviso) and Order XXI, Rule 37, C.P.C. has said that the appeal had been filed by judgement-debtors-whose personal freedom was in peril because a court warrant for arrest and detention in civil prison was chasing them for non-payment of an amount to a bank, which had ripened into a decree and had not yet been discharged and that was such deprivation of liberty illegal. After saying so, Krishna Iyer J. stated that from the perspective of international law the question posed was whether it was right to enforce a contractual liability by imprisoning a debtor in the teeth of Article 11 of the International Covenant on Civil and Political Rights. The Article reads: "No one shall be imprisoned merely on the ground of inability to fulfil a contractual obligation". 9.3. An apercu of Article 21 of the Constitution suggests the question whether it is fair procedure to deprive a person of his personal liberty merely because he has not discharged his contractual liability in the face of the constitutional protection of life and liberty as expounded and expanded by a chain of rulings of the Supreme Court beginning with the case of Maneka Gandhi v. Union of India (1978) 1 SCC 248 . Article 21 reads: "21. Protection of life and personal liberty: No person shall be deprived of his life or personal liberty except according to procedure established by law." 9.4. The Supreme Court set-aside the judgement under appeal and directed executing court to decide de novo the means of the judgement-debtors to discharge the decree in light of interpretation given by them. 9.5. It was observed that while taking up the bearing of Article 11 on the law that is to be applied by an Indian Court when there is a specific provision in the Civil Procedure Code, authorising detention for non-payment of a decree debt; the Covenant bans imprisonment merely for not discharging a decree debt. 9.5. It was observed that while taking up the bearing of Article 11 on the law that is to be applied by an Indian Court when there is a specific provision in the Civil Procedure Code, authorising detention for non-payment of a decree debt; the Covenant bans imprisonment merely for not discharging a decree debt. Unless there be some other vice or mens rea apart from failure to foot the decree, international law frowns on holding debtor's person in civil prison, as hostage by the court. India is now a signatory to the Covenant and Article 51(c) of the Constitution obligates the State to "foster respect for international law and treaty obligations in the dealings of organised peoples with one another". Even so, until the municipal law is changed to accommodate the Covenant what binds the court is the former, not the latter. A.H. Robertson in "Human Rights-in National and International Law" rightly points out that international conventional law must go through the process of transformation into the municipal law before the international treaty can become an internal law. 9.6. From national point of view, national rules alone count. Qua interpretation, however, it is a principle generally recognised in national legal system that in the event of doubt, national rule is to be interpreted in accordance with the State's international obligations. 9.7. The remedy for breaches of International Law in general is not to be found in the law courts of the State because International Law per se or proprio vigore has not the force or authority of civil law, till under its inspiration impact actual legislation is undertaken. 9.8. The positive commitment of the States parties ignites legislative action at home but does not automatically make the Covenant an enforceable part of the corpus juris of India. 9.9. The Supreme Court has said that if the debtor once had the means but now has not, or if he had money now on which there are other pressing claims, it is violative of the spirit of Article 11 to arrest and confine him in jail so as to coerce him into payment. The law does recognise the principle that "Mercy is reasonable in the time of affliction, as clouds of rain in time of drought”. 9.10. The law does recognise the principle that "Mercy is reasonable in the time of affliction, as clouds of rain in time of drought”. 9.10. The Supreme Court concurred with the Law Commission in its construction of Section 51 C.P.C. It followed that quondam affluence and current indigence without intervening dishonestly or bad faith in liquidating his liability could be consistent with Article 11 of the Covenant, because then no detention was permissible under Section 51, C.P.C. 9.11. Equally meaningful was the import of Article 21 of the Constitution in the context of imprisonment for non-payment of debts. The high value of human dignity and the worth of human person enshrined in Article 21, read with Articles 14 and 19, obligates the State not to incarcerate except under law which is fair, just and reasonable in its procedural essence. 9.12. It is too obvious to need elaboration that to cast a person in prison because of his poverty and consequent inability to meet his contractual liability is appalling. To be poor, in this land, is no crime and to 'recover' debts by the procedure of putting one in prison is too flagrantly violative of Article 21 unless there is proof of minimal fairness of his wilful failure to pay in spite of his sufficient means and absence of more terribly pressing claims on his means such as medical bills to treat cancer or other grave illness. Unreasonableness and unfairness in such a procedure is inferable form Article 11 of the Covenant. 9.13. The words which hurt are "or has had since the date of the decree, the means to pay the amount of the decree". This implies, superficially read, that if at any time after the passing of an old decree the judgment-debtor had come by some resources and had not discharged the decree, he could be detained in prison even though at that later point of time he was found to be penniless. This is not a sound position apart from being inhuman going by the standards of Article 11 of the Covenant and Article 21 of the Constitution. The simple default to discharge is not enough. There must be some element of bad faith beyond mere indifference to pay, some deliberate or recusant disposition in the past or, alternatively, current means to pay the decree or a substantial part of it. The simple default to discharge is not enough. There must be some element of bad faith beyond mere indifference to pay, some deliberate or recusant disposition in the past or, alternatively, current means to pay the decree or a substantial part of it. The provision emphasises the need to establish not mere omission to pay but an attitude of refusal on demand verging on dishonest disowning of the obligation under the decree. 9.14. Considerations of debtor's other pressing needs and straitened circumstances will play prominently. By this construction, it was said that law with justice was secured Section 51 with the Covenant and the Constitution was harmonised. 9.15. While laying down the law the Supreme Court directed executing court to re-adjudicate on the present means of debtors vis-a-vis present pressures of their indebtedness, or alternatively whether they have had the ability to pay but have improperly evaded or postponed doing so otherwise dishonestly committed acts of bad faith respecting their assets. The Court was directed to take note of other honest and urgent pressures on their assets since that is the exercise expected of the Court under the proviso to Section 51. In the result the Supreme Court set aside the judgement under appeal and directed the executing court to decide de novo the means of judgement-debtors to discharge the decree in the light of the interpretation given above. As observed by the Supreme Court in its decision in the case of Jolly George Varghese (supra), a simple default to discharge the decree debt is not enough to justify arrest and detention. There must be some element of bad faith beyond mere indifference to pay, some deliberate or recusant disposition in the past or, alternatively current means, to pay the decree or a substantial part of it. The principle contained in Section 51 of the Code emphasises the need to establish not mere omission to pay but an attitude of refusal on demand verging on dishonest disowning of the obligation under the decree. 9.16. The principle contained in Section 51 of the Code emphasises the need to establish not mere omission to pay but an attitude of refusal on demand verging on dishonest disowning of the obligation under the decree. 9.16. It is pertinent to mention here that from a conjoint reading of provisions of Section 51, Section 55, Order 21 Rule 11-A, Order 21 Rule 37, Order 21 Rule 40, it is clear that the judgment-debtor is entitled to have necessary information in execution proceedings and, when judgment debtor is arrested in execution of a decree for payment of money and is brought before the Court, executing Court is also under a statutory obligation to inform judgment-debtor regarding remedy available to him, i.e. to make an application to declare him as an insolvent, and discharge him if he has not committed any act of bad faith regarding the subject of the application and if he complies with provisions of law of insolvency for time being in force. 9.17. In Jolly George Varghese (supra), following guidelines were laid down to be followed by executing court while ordering arrest of judgement debtor in execution proceedings: (1) Passing cryptic orders not based on reasons have to be avoided; (2) Courts are expected to be cautious while making order of arrest in execution of decree since it involves personal liberty; (3) Proper opportunity has to be given and necessary enquiry has to be made while making an order of arrest; (4) Courts may also examine whether other modes of recovery are available to the decree-holder and is it necessary to order arrest for recovery of the amount and whether the judgment-debtors are willfully and intentionally neglecting to discharge the decree debts and Courts may examine the relevant circumstances also in this regard; (5) Even while making an order of arrest in default of appearance of the judgment-debtors, Courts have to prima facie satisfy themselves on the material placed before them that an order of arrest can be made; (6) Courts shall also fix the period for which the judgment-debtors are to be kept in detention. 10. Coming to the case on hand, it appears that Trial Court has not properly applied its mind to all the provisions as discoursed herein before and has directed detention of judgement debtor/petitioner in civil prison in a routine manner, which cannot be sustained. 11. 10. Coming to the case on hand, it appears that Trial Court has not properly applied its mind to all the provisions as discoursed herein before and has directed detention of judgement debtor/petitioner in civil prison in a routine manner, which cannot be sustained. 11. For the aforementioned reasons, the revision petition is allowed, at the admission stage, and the impugned Order dated 20th February 2020, passed by the court of Sub Judge (CJM) Sopore on an Execution Petition titled Firm Gopi Chand, Prem Kumar v. Tariq Ahmad Rather, set aside. The matter is remanded back to the Trial Court/Executing Court for disposal afresh. The Executing Court is directed to consider and decide the matter afresh, as per law, as indicated above, and pass appropriate orders after giving due opportunity of being heard to both parties. 12. As a corollary of above, Superintendent Jail concerned, where petitioner is presently lodged in pursuance of impugned order dated 20th February 2020, shall release petitioner forthwith.