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Lala Bisheshar Das and ors. Vs. Lala Ambika Pershad - Court Judgment

LegalCrystal Citation
CourtAllahabad
Decided On
Judge
Reported in29Ind.Cas.622
AppellantLala Bisheshar Das and ors.
RespondentLala Ambika Pershad
Cases ReferredTikum Singh v. Sheo Ham Singh
Excerpt:
civil procedure code (act v of 1908), section 73, order xxi, rules 52, 63, order xxxviii, rules 5, 10--attachment before judgment, effect of--decree-holder, if obtains priority--other creditors, right of--declaratory suit, whether maintainable. - - ambika got his decree on the 10th of april 1912, it seems to me that we have to consider, what were the rights of the decree-holders on the 23rd of february 1912, that is to say, were they entitled by law to have their decree satisfied out of the money deposited in court? property can only jbe attached before judgment upon the court being satisfied that the defendant, with intent to obstruct or delay the execution of any decree that may be given against him, is about to dispose of the whole or any part of his property, or that he is about to..........attached before judgment. as the court made an order on the 23rd of february 1912, directing the money attached to be paid over to the plaintiffs, the plaintiffs were entitled to receive that money and the court or the defendant ambika prasad could not deprive them of their right to get the money. had ambika prasad already obta'ned a decree on the date on which the money was ordered to be paid to the plaintiffs and had he applied for execution, different equities might arise. it may be that when several decree-holders have caused the same property to be attached, but to whose case section 73 of the code of civil procedure does not strictly apply, they would be entitled to a rateable distribution on general principles of justice, equity any good conscience but that is not the case here......
Judgment:

Henry Richards, C.J.

1. This appeal arises out of a suit in which the plaintiffs sought a declaration that they were entitled to Rs. 627-9-6 out of a sum which had been deposited in Court. The facts are as follows. Ambika Pershad brought a suit against Mahbub and others. Before judgment he attached property which belonged to Mahbub, under the provisions of Order XXXVIII of the Code of Civil Procedure. The property being of a perishable nature, it was sold and the proceeds were lodged in Court on the 29th of March 1911. It is out of this sum that the plaintiffs seek to be paid the amount of a decree. The plaintiffs obtained their decree on the 12th of September 1911. They made an application for execution by attachment of the money in Court on the 10th of January 1912. The Court made an order on the 21st of February 1912, in which it is stated that the property having been attached the money should be paid to the decree-holders upon application. An application for payment was made on the 23rd of February 1912. On the 26th of February 1912, Ambika made an objection to the money being paid to the decree-holders on the ground that he had attached it before judgment. The Court on this objection refused to allow the money to be paid out to the decree-holders, who are the plaintiffs in the present case. Ambika got his decree on the 10th of April 1912, It seems to me that we have to consider, what were the rights of the decree-holders on the 23rd of February 1912, that is to say, were they entitled by law to have their decree satisfied out of the money deposited in Court? If they wore, they are entitled to a decree in the present suit provided that their remedy lay by suit. Order XXXVIII, Rule 5, provides for attachment before judgment. Property can only Jbe attached before judgment upon the Court being satisfied that the defendant, with intent to obstruct or delay the execution of any decree that may be given against him, is about to dispose of the whole or any part of his property, or that he is about to remove the whole or part of his property from the local limits of the jurisdiction of the Court. It seems to me absolutely clear that as it is only to prevent one or other or both of these things that attachment before judgment is allowed, such attachment confers no right in the property on the plaintiff who obtains the order. Every, thpg remains as before the attachment, save that it has been taken out of the power of the defendant to dispose of the property attached or remove it out of the jurisdiction. If there was the least doubt about the matter, it is set at rest by the provisions of Order XXXVIII, Rule 10, which is as follows: 'Attachment before judgment shall not affect the rights, existing prior to the attachment, of persons not parties to the suit, nor bar any person holding a decree against the defendant from applying for the sale of the property under attachment in execution of such decree.' Supposing, therefore, that the property had not been of a perishable nature but had been simply attached before judgment, the plaintiffs would have been entitled to have attached the property, had it sold and obtained payment under their decree. Ambika would have had no right of any sort to object to the decree of the plaintiffs being discharged. Some attempt kas been made to contend that the fact that the property has been turned into money altered the circumstances. I think that this is a most unreasonable contention. In my opinion the money, which represented the property which had been attached before judgment, is to be treated in exactly the same way as the property would have been, with this difference only that of course there is no sale. Under these circumstances it seerns to me that the plaintiffs were clearly entitled on the 32rd of February 1912 to have had their decree satisfied out of the money deposited in Court.

2. It is next argued that the dispute between the plaintiffs and Ambika bad to be decided by the Court in which the money was deposited and that no suit lay. Order XXI, Rule 52, provides that where property which has been attached is in the custody of the Court, any question of title or priority arising between the decree-holder and any other person not being the judgment-debtor, claiming to be interested in such property by virtue of any assignment, attachment or otherwise, shall be determined by such Court.' Order XXXVIII, Rule 8, provides that where any claim is preferred to property attached before judgment, such claim shall be investigated in the manner hereinbefore provided for the investigation of claims to property attached in execution of a decree for the payment of money. 'Order XXI, Rule 63, provides where a claim or an objection is preferred the party against whom an order is made may institute a suit to establish the right which he claims to the property in dispute, but subject to the result of svtch suit, if any, the order shall be conclusive.' It seems to me that the effect of Order XXXVIII, Rule 8, is to incorporate the provisions of Order XXI, and amongst them the provisions of Rule 63. The Court accordingly having investigated the claim of the decree-holders, the plaintiffs in the present suit, and made an order against them, the effect of which was that they were not allowed to raceive payment of their decree, they are entitled to institute a suit. I hold, therefore, that the present aut is maintainable. I would allow the appeal and decree the plaintiffs' claim.

3. Banerji, J.--I have arrived at the same conclusion. The first question to be determined is, whether the Court below was justified in ordering a rateable distribution. It is clear from the provisions df the Code of Civil Procedure that priorty of attachment gives no priority of title. Order XXXVIII, Rule 10, clearly provides that where property has been attached before judgment, that circumstance does not preclude any other judgment-creditor of the judgment-debtor from attaching the same property and proceeding to the sale of it. It is obvious from the provisions of that rule that notwithstanding an attachment before judgment, any other creditor, who has obtained a decree, may proceed to execution end cause the property attached to be sold. The effect of the attachment before judgment is only to prevent the debtor from dealing with the p oparty, but the property still continues to be his. Therefore, the plaintiffs in the present case were entitled to attach the money which was in Court, being the proceeds of the sale of the property attached before judgment. As the Court made an order on the 23rd of February 1912, directing the money attached to be paid over to the plaintiffs, the plaintiffs were entitled to receive that money and the Court or the defendant Ambika Prasad could not deprive them of their right to get the money. Had Ambika Prasad already obta'ned a decree on the date on which the money was ordered to be paid to the plaintiffs and had he applied for execution, different equities might arise. It may be that when several decree-holders have caused the same property to be attached, but to whose case Section 73 of the Code of Civil Procedure does not strictly apply, they would be entitled to a rateable distribution on general principles of justice, equity any good conscience But that is not the case here. It is not necessary, therefore, to express any opinion on the point. In the present case, as I have said above, Ambika Prasad had not obtained his decree when the Court ordered the money in deposit, attached by the plaintiffs, to be paid over to them. Had the property not been of a perishable nature, and had it not been already sold; the plaintiffs would have been entitled to get it sold, and after the sale to have their decree satisfied out of the proceeds of the sale, and there ia nothing in the Cotle to prevent their doing so merely because Ambika Prasad had caused the same property to be attached before judgment. He had not obtained a decree and had not applied for execution. Section 73 of the Code of Civil Procedure would not apply to a case of this kind, because this was not a case in which several decree-holders had before the realisation of assets applied for execution of their decrees.

4. There remains the other question as to whether such a suit is maintainable. As has been pointed out by the learned Chief Justice Rule 52 and the subsequent rules in Order XXI are, by reason of the provisions of Order XXXVIII, Rule 8, applicable to cases of attachment before judgment. Under Rule 52 of Order XXI the Court which holds the property is the Court which must decide all claims made in respect of it, whether arising from assignment or attachment or otherwise. The mode of investigation is provided for by Rule 58 and the subsequent rules, but in all cases when an order is made, the defeated party is entitled to bring a suit to establish his right under Rule 63. The language of that Rule differs from that of Section 283 of the old Code of Civil Procedure. Under that section a party was allowed to bring a suit when an order had been passed against him under Sections 280, 281 and 282. There is no such limitation in Order LXIII and this alteration appears to have been deliberately made by the Legislature to include all cases of orders of this kind passed under Order XXI, including orders under Rule 52. I find that under, the old Code of Civil Procedure, it was hold that where an order was made under Section 272, which corresponds to the present Rule 52, a suit would lie to set aside the order Tikum Singh v. Sheo Ham Singh 19 C. 286. The present suit was, in my opinion, clearly maintainable. I also would allow the appeal.

5. By the Court.--The order of the Court is that the appeal be allowed, the decree of the Court below set aside and the decree of the Court of first instance restored with costs in all Courts, including in this Court fees on the higher scale.


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