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2025 DIGILAW 1133 (KER)

Rajendran, S/o. Narayanan v. Reshny, W/o. Muralidharan

2025-05-02

SYAM KUMAR V.M.

body2025
JUDGMENT : (SYAM KUMAR V.M., J.) Dated this the 2 nd day of May, 2025 This appeal is filed against the order dated 18.03.2024 in I.A. No. 8 of 2024 in O.S. No. 27 of 2021 of the Sub Court, Mavelikara. Appellant was the counter petitioner in the I.A and defendant in the suit. The respondent was the petitioner in the I.A. and plaintiff in the suit. Parties are referred to hereinafter as per their status in the suit. 2. The suit was filed by the plaintiff for realization of Rs. 20,00,500/- with interest from the defendant by charging upon his assets. The case of the plaintiff is that the defendant and his wife are conducting a private school. For the development of the school, they borrowed money from the plaintiff. On 25.09.2017, an amount of Rs.17,50,000/- was borrowed and an agreement was executed by the defendant in favour of the plaintiff stipulating the terms of repayment and interest. However, the said agreement was breached by the defendant and amounts due were not paid to the plaintiff. A legal notice was issued by the plaintiff to the defendant demanding principal amount and balance interest. However, the defendant did not settle the outstanding. Hence, the suit was filed. A petition seeking to attach the property of the defendant was filed along with the suit. However, the defendant managed to defeat the claim and the attached property is now found insufficient to meet the claim amount. The plaintiff later received information regarding some other property over which the defendant has title and she got reliable information that the defendant is attempting to alienate the same as well. Hence I.A. No.8 of 2024 was filed seeking an order of attachment over the relevant property, so as to secure the suit amount. The defendant filed an objection to the I.A., inter alia pointing out that the objective of the plaintiff in filing an attachment petition again and seeking to attach another property is to coerce the defendant to settle the suit. The I.A. had been filed by the plaintiff suppressing material facts in her pleadings. Suppression had been allegedly made by the plaintiff in the earlier I.A. seeking attachment too. The I.A. had been filed by the plaintiff suppressing material facts in her pleadings. Suppression had been allegedly made by the plaintiff in the earlier I.A. seeking attachment too. The Sub Court, after hearing the parties, rendered the impugned order allowing the petition filed by the plaintiff and attaching the property detailed in the schedule appended to the I.A. The said order is challenged by the defendant in this FAO. 3. A counter affidavit has been filed by the plaintiff producing therewith Annexures R(a) to R(d). 4. Heard Sri. George Varghese (Perumpallikuttiyil), Advocate for the appellant/defendant and Sri Johnson Gomez, Advocate for the respondent/plaintiff. Contentions of the Appellant( defendant) in brief: ? The order of attachment before judgment issued by the Sub Court is erroneous and unsustainable in law. ? There has already been an attachment of the properties of the defendant earlier at the instance of the plaintiff in the very same suit. Two items of property lying adjacent to the State Highway having an extent of 35 cents (with a building of 2200 Sq. Ft.) and 10 cents respectively had already been attached by the plaintiff. ? The particulars of the property, including the existence of the building, had been wilfully suppressed in the application and the value of the property had been shown as Rs. 4 lakhs. The defendant had filed an objection challenging the allegations in the suit as well as in the said attachment petition. ? As regards the 2 nd item of property thus attached, a claim petition had been preferred by the person who had purchased the property prior to the institution of the suit and the said claim petition is pending consideration. This is the ruse now to seek further attachment of other properties by the plaintiff. ? Two and a half years after the first attachment, the plaintiff has now chosen to file I.A.No. 8 of 2024 seeking attachment before judgment of further items of property viz., an extent of 6.50 cents along with the building thereon owned by the defendant raising the very same and identical allegations. ? The Sub-Court while allowing the 2 nd attachment petition, order of which is under challenge herein, failed to take note of the fact that the specifics of the building situated in the properties sought to be attached and its value were deliberately not stated in the I.A. for attachment. ? The Sub-Court while allowing the 2 nd attachment petition, order of which is under challenge herein, failed to take note of the fact that the specifics of the building situated in the properties sought to be attached and its value were deliberately not stated in the I.A. for attachment. This specifically contravened the mandate of Order 38 Rule 5(2) of the Code of Civil Procedure . ? The attachment petition has not thus stated the material particulars and did not show the differential amount for which the attachment before judgment is sought to be effected. This aspect had been specifically pointed out by the defendant in the objection filed by him to I.A. No. 8 of 2024 and it was specifically pointed out that the first item of property which is already lying in attachment is sufficient to satisfy the decree, if any, passed. The said aspect was overlooked by the Sub Court. ? The Sub Court had proceeded to attach additional items of property over and above the properties already attached without passing a conditional order of attachment as mandated under Order 38 Rule 5(1). This is illegal and unsustainable in law. ? No attachment could have been ordered by the Sub-Court in the absence of the specific averment regarding the differential decree amount to be secured by way of attachment of additional item of property. ? The Sub Court ought to have noted that the suppression of material particulars such as the estimated value of the building in the scheduled property would disentitle the plaintiff from seeking an attachment before judgment over and above the attachment that has already been effected. ? Non compliance of the mandates of Order 38 Rule 5(1) has led to substantial prejudice to the defendant and in effect renders the 2 nd attachment affected illegal and unsustainable. ? It is trite that the defence canvassed by the defendant must also be considered in passing an order under Order 35 Rule 5. The Sub Court had allowed the application for attachment without properly adverting to the objection raised by the defendant, and had thus allowed attachment before judgment of the additional item of the property that too without passing an order of conditional attachment. In this respect, reliance is placed on the dictum laid down in Thomas v. Thahira Beevi [2009( 3) KHC 22] . ? In this respect, reliance is placed on the dictum laid down in Thomas v. Thahira Beevi [2009( 3) KHC 22] . ? Attachment before judgment is an extraordinary power and the court may grant the same only with great care and caution such an order is not to be granted on mere assertion of attempt to dispose of or remove the property. Reliance is placed on the dictum laid down in Woodys Hotel Pvt. Ltd. v. Prasant Kumar Panigrah [1998 KHC 29] ? It is well settled that the purpose of Order 38 Rule 5 is not to convert an unsecured debt into a secured debt. Any attempt by a plaintiff to utilize the provisions of Order 38 Rule 5 as a leverage for coercing the defendant to settle the suit claim ought to be discouraged. Merely having a just or valid claim or a prima facie case will not entitle the plaintiff to an order of attachment before judgment, unless he also establishes that the defendant is attempting to remove or dispose of his assets with the intention of defeating the decree that may be passed. It is well settled that even where the defendant is removing or disposing his assets, an attachment before judgment will not be issued, if the plaintiff is not able to satisfy that he has a prima facie case. Reliance is placed on the dictum laid down in Raman Tech & Process Engineering Company and another v. Solanki Traders. [2008 KHC 4380]; ? The Sub Court ignored the settled position that even when the plaintiff succeeds in showing a prima facie case, but fails to establish the conditions in clause (a) and (b) in Order 38 Rule 5 as to the alleged intention of the defendant, the law will not still favour him with an order of attachment before judgment because attachment is said to be an extraordinary power vested in the court and unless it is wielded with care and caution, it would go to the extent of leaving a very disastrous effect on the adverse party, affecting his status and reputation in the public Galgotias University v. Malayala Manorama Company Ltd. [ 2019 KHC 447 ] ? It is settled that an attachment unaccompanied by an order directing the defendant to furnish security within a specified period or to appear in show cause why he should not furnish security is a nullity. It is settled that an attachment unaccompanied by an order directing the defendant to furnish security within a specified period or to appear in show cause why he should not furnish security is a nullity. Reliance is placed on the dictum laid down in Mohammed Hariss v. Fathima, [1993, KHC 91]; Retnamma v Govinda Pillai [1995 KHC 70] ? The Sub Court ought to have ordered attachment only on failure to furnish security. The Sub Court was bound by law to consider the question of security and it is only on failure to furnish security that the attachment could have been ordered. Reliance is placed on the dictum in Vasu v Narayanan Nambooripad [1961 KHC 261]. ? Without quantifying the sum for which security by way of attachment is sought, no conditional order could have been ordered by the Sub Court. Though the court is competent to pass a conditional order under Order 38 Rule 5(1) at any stage of the suit, if it is satisfied on the basis of affidavit or otherwise, that condition A or B subsists as a prerequisite to the issuance of such an order, the court ought to have directed the defendant within a time to be fixed by it either to furnish security in such sum as may be specified in the order. The said mandatory course of action had not been complied with by the Sub Court while issuing the impugned order. ? The order passed by the Sub Court ordering attachment of additional item of property is one issued under Order 38 Rule 6(1) and is hence appealable. ? The impugned order in I.A.No. 8 of 2024 for attachment of additional item of property without complying with the mandates of Order 38 (5) is thus unsustainable and liable to be set aside. Contentions of the respondent (plaintiff) in brief: ? The appeal preferred by the defendant is not maintainable and the contention that the same is maintainable under Order 43 Rule 1 (q) of the CPC is misplaced. Reliance is placed on the dictum laid down by this Court in case K . Sadasivan vv. Surendradas [2020 SCC Onlie Ker 4412], wherein it had been held that when a final order is passed without a preconditional attachment the same is not appealable. ? Reliance is placed on the dictum laid down by this Court in case K . Sadasivan vv. Surendradas [2020 SCC Onlie Ker 4412], wherein it had been held that when a final order is passed without a preconditional attachment the same is not appealable. ? Initially, two properties of the defendant were attached, but a claim petition was subsequently filed by a third party regarding one of these properties and the other property was held in joint ownership by the appellant and his wife with the building. The allegation that the plaintiff had suppressed the details of the building is incorrect. The existence of the building was not suppressed in the I.A. as alleged. The same was mentioned in the plaint by the plaintiff. ? The defendant was found to be taking hasty steps to alienate his properties and had malafied intentions. It is after being convinced of the same that the Sub-Court rightly exercised its jurisdiction to prevent obstruction in the execution of the decree that could be rendered in the pending suit ? In the objection filed by the defendant to I.A.No. 8 of 2024 the defendant had not specifically denied the allegation that he was attempting to alienate/dispose of the scheduled property, so as to delay the execution of the decree that may be passed against him. In the objection filed by the defendant, the said specific contention raised by the plaintiff was neither denied nor objected to and the defendant had only evasively stated that he will not escape from the jurisdiction of the court. ? The impugned order of the Sub Court, even though it does not comply with Order 38 Rule 5 (1) CPC, is valid insofar as the defendant had failed to furnish security. Reliance is placed on the dictum laid down by the High Court of Andhra Pradesh in Sripathi Panditarajula Venkanna Babu v. Varalakshmi Finance Corporation, Rajahmundry [1996 SCC Online AP 651]. ? As per the dictum laid down in Sripathi (supra), the proper remedy for the defendant is to move the trial court seeking to recall the impugned order. ? The conditional attachment of additional item of property was necessary since execution against the joint property held by the defendant and his wife would prove to be difficult and a third party claim had already been raised regarding another attached property. ? The conditional attachment of additional item of property was necessary since execution against the joint property held by the defendant and his wife would prove to be difficult and a third party claim had already been raised regarding another attached property. The defendant had never filed any affidavit refuting the same. ? The plaintiff had presented tangible materials before the court establishing that the defendant was attempting to alienate his properties, so as to obstruct the execution of a decree. It is after being satisfied with the said contention that the Sub Court had ordered the attachment. The Sub Court had, by rendering the impugned order, ensured that the decree, if any passed, once proceeded to be executed, would not be delayed or obstructed. ? The appeal filed by the defendant is only to be dismissed as not maintainable. Discussion and Analysis 5. I have heard both sides in detail, considered the contentions put forth and have perused the precedents relied on by both parties. The guiding principles regarding the power of court exercisable under Order 38 Rule 5 of the CPC have been laid down in a catena of decisions including Sadasivan (supra). They are mainly as follows: 1. An order under Order 38 Rule 5 can be issued only if the circumstances exist as are stated therein to the satisfaction of the Court. 2. An order of attachment before judgment or an order for furnishing security shall not be issued on the assumption that no harm would be done thereby to the defendant or that the defendant would not be prejudiced by issuing such a direction and (3) The affidavit in support of the contentions of the applicant should not be vague. Where it is affirmed true to the knowledge or information, it must be stated as to which portion is true to the knowledge and, source of the information should be disclosed. Also the grounds for the belief should be stated. 6. It is relevant to note that admittedly there has been no compliance with the mandates of Order 38 Rule 5(1) CPC by the Sub Court before issuing the impugned order of attachment. An order of attachment made without complying with the stipulations in Order 38 Rule 5(1) shall in terms of Sub Rule 4 be void. 6. It is relevant to note that admittedly there has been no compliance with the mandates of Order 38 Rule 5(1) CPC by the Sub Court before issuing the impugned order of attachment. An order of attachment made without complying with the stipulations in Order 38 Rule 5(1) shall in terms of Sub Rule 4 be void. As laid down in Sadasivan (supra), the said provision makes it amply clear that the validity of an order of attachment is directly dependent on the compliance of the procedure envisaged under Sub Rule 1 of Order 38 Rule 5. It has been held that meticulous compliance of the essential conditions and observance of the procedure are mandatory. The said compliance had not been affected by the Sub Court before issuance of the impugned order of attachment. 7. It assumes relevance to note that the attachment sought was with respect to additional item of property after an attachment of a larger extent of property, purportedly said to have a value of more than One Crore Rupees, had already been effected and put in place. What had weighed with the Sub Court to allow the application for attachment of additional item of property can be discerned from para 9 of the impugned order wherein the Sub Court had observed as follows: “The specific contention raised by the defendant is that the first item property detailed in schedule appended with IA 1 of 2021 will fetch market value of more than 1 crore rupees and the further order of attachment is not necessary. If so, as claimed by the defendant, the present petition lacks merits but it is subjected to the satisfaction of the court about the valuation of the first item property. Thus, I am of the view that the defendant is at liberty to establish the valuation of the property and its defect free title properly. While considering the grievance of the petitioner that the defendant has already disposed of one of the properties and is interested in disposing of the remaining properties, it is not desirable to wait till the satisfaction of the valuation of the first item of the property. 8. The above course adopted by the Sub Court whereby the mandates of Order 38 Rule 5(1) had been totally bypassed cannot be said to be proper and in accordance with law. 8. The above course adopted by the Sub Court whereby the mandates of Order 38 Rule 5(1) had been totally bypassed cannot be said to be proper and in accordance with law. Since two parcels of land belonging to the defendant had already been attached, albeit with a claim petition pending with respect one among the two, the Sub Court ought to have strictly complied with the mandates of Order 38 Rule 5(1). Shifting the burden on to the defendant by stating that it is open to the defendant to establish the value of the item of property already lying under attachment is not a substitute for compliance with the mandates under Order 38 Rule 5(1). In the facts and circumstances of the case, I find merit in the contention that no attachment could have been ordered by the Sub Court in the absence of the specific averment regarding the differential decree amount to be secured by way of attachment of additional item of property. The law does not envisage or permit the plaintiff to engage in an attachment spree and proceed to attach one property after the other of the defendant and thus to pressurise the defendant to fall in line with the demands of the plaintiff. This is exactly what was attempted to be prevented by incorporating Sub Rule 4 in Order 38(5) of the CPC and elucidated in Sadasivan (supra) by insisting that meticulous compliance of the essential conditions and observance of the procedure under Order 38 are mandatory. I find merit in the contention put forth by the learned counsel for the appellant/defendant that the plaintiff was proceeding to attach one property after the other that too without satisfying the mandates of Order 38 Rule 5(1) to pressurise the defendant. Be that as it may, the Sub Court while considering the I.A. filed seeking to attach an additional item of property, ought to have exhibited great care and caution and ought not have granted such an order on mere assertion of an attempt to dispose of or remove the property. Conclusion: In view of the above, the order dated 18.03.2024 in I.A. No.8 of 2024 in O.S.No.27 of 2021 of the Sub Court, Mavelikara is set aside. The matter is remanded back to the Sub Court for fresh consideration in accordance with law. FAO is allowed. No costs.