M/s. Era Construction (India) Limited and Others vs M/s. Johri Lal Bansi Dhar

Kamlesh Sharma, J.—The Petitioners are the Defendants whereas the Respondent is the Plaintiff in a civil suit pending before District Judge, Solanfor the recovery of Rs. 2, 33,737.67 Ps. and they will be referred to as such in this judgment. When the civil suit was at the stage of Plaintiff''s evidence, it moved an application under Order 38 Rule 5 read with Section 151 CPC for attachment before judgment which was allowed by the impugned order dated 8.9.1998. Feeling aggrieved, the Defendants have filed the present revision petition u/s 115 Code of Civil Procedure

The impugned order is as under:

8.9.98

Present: K.L. Gupta Advocate for the Plaintiff.

Shir. I.J.S. Gyani, Advocate for the Defendants.

I am satisfied from the application supported by affidavit of applicant Plaintiff that the Respondents with intent to delay the execution of decree which may be passed against them are likely to dispose of their property within the jurisdiction of this Court and if they succeed in doing so, the applicant would not be able to execute the decree which may ultimately be passed in his favour. Therefore, the Respondents called upon to furnish security in the sum of Rs. 2.5 lacs for satisfaction of the decree which may be passed against them and such security be furnished within 30 days. Be tagged with the main suit.

Sd/-

District Judge, Solan.

This Court has heard the learned Counsel for parties and gone through the record. The learned Counsel for the Plaintiff has raised preliminary objection that the impugned order passed under Order 38 Rule 5 CPC calling upon the Defendants to furnish security being interlocutory is not revisable u/s 115 CPC ordering to the learned Counsel, final order is passed under Order 38 Rule 6 whereby the attachment of the property of the Defendant is ordered if he fails to show cause why he should not furnish security or fails to furnish security required to be filed within the time fixed by the Court which is an appeal able order. It is also urged that by calling upon the Defendant to furnish security, he is not prejudiced in any manner as none of his rights, is affected. It is also submitted that since the impugned order does not amount to a case decided within the meaning of Section 115 Code of Civil Procedure, the present revision petition is not maintainable. On the other hand, the learned Counsel for the Defendants has submitted that the preliminary objection has been raised to be rejected. According to the learned Counsel, if the order passed under Order 38 Rule 5 is inherently illegal and void and no appeal lies against that, it can be assailed only in revision.

After giving its best consideration, this Court does not find the preliminary objection sustainable. For deciding the preliminary objection, reference to Section 115 is necessary which is as under:

Revision (1) The High Court may call for the record of any case which has been decided by any court subordinate to such High Court and in which no appeal lies thereto, and if such subordinate court appears

(a) to have exercised a jurisdiction not vested in it by law, or

(b) to have failed to exercise a jurisdiction so vested,

(c) to have acted in the exercise of its jurisdiction illegally or with material irregularity, the High Court may make such order in the case as it thinks fit:

Provided that the High Court shall not, under the section, vary or reverse any order made, or any order deciding an issuein the course of a suit or other proceeding, except where

(a) the order, if it had been made in favour of the party applying for revision, would have finally disposed of the suit or other proceeding, or

(b) the order, if allowed to stand, would occasion a failure of justice or cause irreparable injury to the party against whom it was made.

(2) The High Court shall not, under this section vary or reverse any decree or order against which an appeal lies either to the High Court or to any court subordinate thereto.

Explanation. In this section, the expression "any case which has been decided" includes any order made, or any order deciding an issuein the course of a suit or other proceeding.

The perusal of Sub-section (1) of Section 115 shows that for ex- excising the jurisdiction u/s 115, the High Court must examine whether the order under revision amounts to a case decided and the conditions in Clause (a), (b) or (c) are satisfied. Interlocutory character of the order, the existence of Anr. remedy to an aggrieved party by way of appeal and the general equities of the case being served by the impugned order are the matters to be taken into account while exercising jurisdiction u/s 115. The proviso to Sub-section (1) of Section 115 lays down that no revision application shall lie against an interlocutory order unless either of the two conditions is satisfied; namely (i) that if the order was made in favour of the applicant, it would have finally disposed of the suit or other proceedings; or (ii) that the order if allowed to stand, is likely to occasion failure of justice or cause irreparable injury. So far the case in hand is concerned, the impugned order calling upon the Defendants to furnish security in the sum of Rs. 2.5 lacs within 30 days is no doubt an interlocutory order, but it has finally decided the application under Order 38 Rule 5 filed by the Plaintiff. Had only notice to show cause been given, the order would have been interim not amounting to case decided.

The impugned order also fulfils the requirement of proviso in as much as had the order been made in favour of the Defendants seeking revision, it would have finally disposed of the application under Order 38 Rule 5 and if it is allowed to stand, it is likely to occasion failure of justice as it has been passed without fulfilling the requirements of Sub-rule (1) of Rule 5 of Order 38. One of the three conditions, namely, condition (c) of Sub-section (1) of Section 115 is also satisfied as by passing the impugned order \\ without satisfying that the requirements of Sub-rule (1) of Rule 5 of Order 38 are duly fulfilled, the District Judge has passed the impugned order. Therefore, this Court has no hesitation to hold that the present revision petition is maintainable.

In order to examine this petition on merits, reference to Rule 5 of Order 38 is necessary. It is:

Where Defendant may be called upon to furnish security for production of property. (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 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 sum 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.

(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 of the property so specified.

(4) If an order of attachment is made without complying with the pro visions of Sub-rule (1) of this Rule, such attachment shall be void.

The perusal of Sub-rule (1) of Rule 5 shows that essential requirements for invoking the powers of Court under this provision are that the Defendant is about to dispose of the whole or any part of his or her property, or the Defendant is about to remove whole or any part of his or her property from the local limits of the jurisdiction of the Court and the Defendant is intending so to do with a view to cause obstruction or delay the execution of any decree that may be passed against him. In view of these requirements, it is incumbent upon the Plaintiff to state precisely the grounds on which the belief or apprehension is entertained that the Defendant is likely to dispose of or remove the property. It may even be necessary in some cases to give the source of information and belief. A mere mechanical repetition of the provisions in the Code or the language therein without giving necessary particulars in support of the allegations, would not be in compliance of the first part of Order 38 Rule 5(1). This has exactly happened in the case in hand. No such particulars have been given in the application filed by the Plaintiff which contains only mechanical repetition of the provisions of Order 38 Rule 5(1). Despite the objections taken by the Defendants, the District Judge has also passed the impugned order without satisfying himself that the Defendants with a view to defeat or cause obstruction or delay the execution of any decree were about to dispose of the whole or any part of their property or even to remove the whole or any part of their property from the local limits of the jurisdiction of the Court. In factin the absence of necessary particulars in support of all these allegations made in the application, there was no material before the District Judge to pass the impugned order in which he has also mechanically reproduced the language of Order 38 Rule 5(1) CPC Therefore, the impugned order does not stand to judicial scrutiny and deserves to be set-aside.

For taking this view, this Court has found support from AIR 1980 AP 176 , W. Pappammal Vs. I. Chidambaram, N. Pappammal v. L. Chidambaram; AIR 1985 Karnataka 282, Tatanagar Transport Corporation and Others Vs. Ajanta Enterprisers and Another, , Bank of India Vs. National Tile Work Industries and Others, , The Nullimarla Jute Mills Co. Ltd. Vs. Sree Mahaveer Rice and Oil Mills, The Nullimarla Jute Mills Co. Ltd. v. Sree Maliaveer Rice and Oil Mills.

It has been consistently held in all these judgments that order passed under Rule 5 of Order 38 is in the nature of extra-ordinary jurisdiction and has to be exercised sparingly and strictly in accordance with procedure prescribed therein. The Plaintiff must prove a prima-facie case in his favour by giving some definite evidence and not by mere vague allegations that the Defendant has intention to obstruct or delay the execution of any decree that may be passed in the suit and for this purpose he is about to dispose of the whole or any part of his property or is about to remove the whole or any part of his property from the local limits of the jurisdiction of the Court. Before passing the order, the Court must be satisfied that all the ingredients of the rule exist.

Second part of Sub-rule (1) of Rule 5 of Order 38 further shows that the Court may either direct the Defendant within a time to be fixed to furnish security in such sum as may be specified in the order or to appear and show cause why he should not furnish security. In the present case, the District Judge has exercised the first option and called upon the Defendants to furnish security within a period of 30 days. under Sub-rule (2) of Rule 5 of Order 38, the Plaintiff is also required to specify the property sought to be attached and the estimated value thereof, unless the Court otherwise directs. So far the case in hand is concerned; the Plaintiff has sought the attachment of the amount due to the Defendants from M/s. Gontermen Pipers India Limited, Ropar Road, Nalagarh, which could not be done. The provision of Sub-rule (1) of Rule 5 of Order 38 envisages the attachment of the property of the Defendant and not of third party. So far the Rules 3, 4 and 6 of Order 38 are concerned, these are not attracted in the present case.

The learned Counsel for the Plaintiff has pointed out that no fault can be found with the impugned order as the Defendants in their reply to the application have themselves offered to give security. This argument has been raised to be rejected as the perusal of reply shows that the offer made by the Defendants was subject to the satisfaction of the Court that the ingredients of Rule 5(1) of Order 38, were satisfied.

The result of above discussion is that there is - merit in this revision / petition. Accordingly, it is allowed and the impugned order dated 8.9.1998 passed by the District Judge, Solan is set-aside. However, the Plaintiff is not prevented from making fresh application under Order 38 Rule 5 CPC if it has reasons to do so, which will be decided by the District Judge in accordance with law in the light of observations made hereinabove. No costs.