Tehal Singh vs Shivji Ram

Sukhdev Singh Kang, J.—As common questions of law permeate Civil Revision Nos. 618 and 1255 of 1985, they invite a common judgment.

Shivji Ram filed a suit against Tehal Singh, petitioner, for the recovery of Rs. 2662.50. The learned trial Judge decreed the suit, with costs on December 7, 1982. Shivji Ram filed an execution petition on 21st May, 1983. Certain articles viz. bicycles, transistor, radio, tables, chairs, iron boxes etc. were sought to be attached and sold through public auction. Tehal Singh, Judgment-debtor, filed an objection petition contending that the articles were exempt from attachment; the debt to be deemed to have been discharged under the Punjab Agricultural Indebtedness Relief Act, 1975, and that the interest and costs were excessive. He also prayed that in the event of failure of his objections, he be allowed to make payment through easy intalments. The decree-holder contested the objections. The objections petition was dismissed on 9th February, 1983. An attachment warrant was issued. The brother of Tehal Singh filed objections, and the same were rejected by the executing court vide order dated 10th September, 1983. An appeal against that order failed and was dismissed by the Additional District Judge, Patiala. Warrants of attachment were repeatedly received back unexecuted.

Shivji Ram, decree-holder, filed an application under Rule 37 of Order 21, Civil Procedure Code, for coercing the juddment-debtors to satisfy the decree in question, and that the judgment-debtor should be arrested and detained in a Civil prison. A notice was issued to the judgment-debtor to show cause why he should not be committed to the Civil prison. Tehal Singh failed to make any satisfactory reply. Consequently, the warrants of his arrest were issued. He was arrested and produced in Court on 28th January, 1985. He made a prayer that he should be given some time to arrange money so that he could satisfy the decree. The prayer of the judgment-debtor was accepted on furnishing the security and the case was adjourned to 12th February, 1985, for making payment.

On the adjourned date, the judgment-debtor did not make the payment of the decretal amount and rather he put in an objections petition contending that he was unable to satisfy the decree in full or any portion thereof, and that he should be granted time to apply for being declared insolvent. Notice of this application was given to the decree-holder. He opposed the grant of the time and pleaded that the application was filed mala fide with an intent to delay and defeat the execution of the decree. The judgment-debtor was estopped from filing that application. The learned executing Judge dismissed this objection petition holding that the judgment debtor was only interested in delaying and defeating the decree. He had no intention to make the payment of the decretal amount or any portion thereof. The execution application was pending since 1983 and the judgment-debtor had not moved any application for getting himself declared as insolvent from the competent Court. He has been rather delaying the execution proceedings by filing objections himself and through his relations. The judgment-debtor by his acts and conduct stood estopped from filing the present objections petition. It was filed mala fide. The petitioner has challenged this order through Civil Revision No. 618 of 1985.

On the same day, after dismissing the application of the judgment-debtor for getting time to get himself declared insolvent, the executing Court passed orders on the application of the decree-holder under Rule 37 of Order 21, Civil Procedure Code. He allowed the application and directed Tehal Singh, petitioner, to be sent to the Civil prison for 75 days or earlier until the satisfaction of the decree along with the costs and interests. Tehal Singh has challenged this order through Civil Revision No. 1215 of 1985. The learned counsel for the parties pray that these two petitions should be heard together and disposed of by a common judgment.

In order to appreciate the rival contentions of the learned counsel for the parties, it will be appropriate to read the relevant statutory provisions at the threshold:

Code of Civil Procedure

Section 51. Powers of Court to enforce execution:--

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 any property specifically decreed;

(b) by attachment and sale or by sale without 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 of 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 had since the date of the decree, the means to pay the amount of the decree or some substantial part thereof and refused 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.

Section 55(3). Where a judgment-debtor is arrested in execution of a decree for the payment of money and brought before the Court, the Court shall inform him that he may apply to be declared an insolvent, and that he may be discharged if he has not committed any act of bad faith regarding the subject of application and if he complies with the provisions of the law of insolvency for the time being in force.

Section 55(4). Where a judgment-debtor expresses his intention to apply to be declared an insolvent and furnishes security, to the satisfaction of the Court, that he will within one month so apply, and that he will appear, when called upon, in any proceeding upon the application or upon the decree in execution of which he was arrested, the Court may release him from arrest, and, if he fails so to apply and to appear, the Court may either direct the security to be realised or commit him to the civil prison in execution of the decree.

Order 21, Rule 37. Discretionary power to permit judgment-debtor to show cause against detention in prison.--(1) Notwithstanding anything in these rules, where an application is for the execution of a decree for the payment of money by the arrest and detention in the civil prison of a judgment-debtor who is liable to be arrested in pursuance of the application, the Court shall instead of issuing a warrant for his arrest, issue a notice calling upon him to appear before the Court on a day to be specified in the notice and show cause why he should not be committed to the Civil prison;

Provided that such notice shall not be necessary if the Court is satisfied, by affidavit or otherwise, that, with the object or effect of delaying the execution of the decree, the judgment-debtor is likely to abscond or leave local limits of the jurisdiction of the Court.

(2) Where appearance is not made in obedience to the notice, the Court shall, if the decree-holder so requires, issue a warrant for the arrest of the judgment-debtor.

Order 21, Rule 40. Proceedings on appearance of judgment-debtor in obedience to notice or after arrest.--(1) When a judgment-debtor appears before the Court in obedience to a notice issued under Rule 37, or is brought before the Court after being arrested in execution of a decree for the payment of money the Court shall proceed to hear the decree-holder and take all such evidence as may be produced by him in support of his application for execution and shall then give the judgment-debtor an opportunity "of showing cause why he should not be committed to the civil prison.

(2) Pending the conclusion of the inquiry under sub-rule (1) the Court may, in its discretion, order the judgment-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.

(3) Upon the conclusion of the inquiry under sub-rule (1) the Court may, subject to the provisions of Section 51 and to the other provisions of this Code, make an order for the detention of the judgment-debtor in the civil prison and shall in that event cause him to be arrested if he is not already under arrest;

Provided that in order to give the judgment-debtor an opportunity of satisfying the decree, the Court may, before making the order of detention, leave the judgment-debtor in the custody of an officer of the Court for a specified period not exceeding fifteen days or release him on his furnishing security to the satisfaction of the Court for his appearance at the expiration of the specified period if the decree be not sooner satisfied.

(4) A judgment-debtor released under this rule may be rearrested.

(5) When the Court does not make an order of detention under sub-rule (3), it shall disallow the application and, if the judgment-debtor is under arrest, direct his release.

It is plain from a reading of the above provisions that an executing Court can order the execution of a decree by arrest and detention in prison of the judgment-debtor if it is satisfied (i) that the judgment-debtor, with the object of delaying the execution of the decree, 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 or concealed any part of his property or committed any other act of bad faith in relation to that, or (iii) that the judgment-debtor has had since the date of the decree the means to pay the amount of the decree or substantial part thereof and refuses or neglects or has refused or neglected to pay the same. Unless and until any of these conditions is satisfied, the executing Court cannot order the detention of the judgment-debtor even if he fails to satisfy the decree. In the present case, the learned executing Court has only mentioned that the judgment-debtor had been trying to delay and defeat the execution proceedings. He had filed frivolous objections and had also got filed such objections from his relations. He has not given a finding that the judgment-debtor had been guilty of any acts of omission and commission enumerated above. From the tenor of the impugned order, it will be seen that the decree-holder has not pleaded any of the grounds mentioned in (a), (b) or (c) of proviso to section 51 while seeking the commitment of the petitioner to the prison. Rule 40 of Order 21, Civil Procedure Code, which authorises the Court to commit the judgment-debtor to a civil prison, provides that an order of commitment to prison has to be made subject to the provisions of Section 51, enumerated above. This is a condition precedent for invoking jurisdiction under Order 21, Rules 37 and 40, Civil Procedure Code. The order of detention of the petitioner to civil prison for 75 days is thus unsustainable in law. The learned executing Court acted with material irregularity in exercise of its jurisdiction. The order is, therefore, liable to be quashed. I order accordingly.

The second order rejecting the prayer of the petitioner under Sub-sections (3) and (4) of Section 55 of the CPC is also unsustainable. Sub-section (3) enjoins upon the Court to inform the judgment-debtor who has been arrested in execution of a decree for the payment of a money and brought before it that he (the judgment-debtor) may apply to be declared insolvent and he (the judgment-debtor) may be discharged if he had not committed any act of bad faith regarding the subject of the execution application and if he complies with the provisions of law of insolvency for the time being in force. In the present case, there has been a patent violation of this mandatory provision contained in sub-section (3) of Section 55. When the petitioner was arrested and produced in Court, it did not inform the judgment-debtor about his rights to be declared insolvent. Not only that when on the next date of the hearing, the petitioner made an application for that purpose, the same was turned down on untenable grounds. The executing Court was bound to comply with the mandatory provisions of sub-sections (3) and (4) of Section 55. It had to provide the judgment-debtor an opportunity to make application for being declared as insolvent. Of course, the Court could require the petitioner to furnish security. The trial Court while dismissing the application of the petitioner under sub-section (3) of Section 55, Civil Procedure Code, had failed to exercise jurisdiction vested in it. The order is void and is quashed.

In the result, both the revision petitions are allowed with costs and the impugned orders are set aside. Counsel fee Rs. 100/- in each case.