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S.N. Sunderson and Co. Vs. Harbans Singh Sobti and Co. (P) Ltd. and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtDelhi High Court
Decided On
Case NumberCivil Revision Appeal No. 209D of 1964
Judge
Reported inILR1972Delhi263
ActsCode of Civil Procedure (CPC), 1908 - Sections 39
AppellantS.N. Sunderson and Co.
RespondentHarbans Singh Sobti and Co. (P) Ltd. and anr.
Advocates: G.N. Aggarwal,; B.N. Nayar,; M.S. Rekhi and;
Cases ReferredAmbika Ranjan Majumdar v. Manikganj Loan Office Ltd.
Excerpt:
civil p.c. - sections 39 & 47--jurisdiction of executing court to attach money lying outside its jurisdiction--distinction between order 21,rule 48 c.p.c. and order 21 rule 52 c.p.c. order 21 rule 46 c.p.c. also considered.; when a property sought to be attached is outside the jurisdiction of the court which passes the decree the court cannot attach it, but it must transfer the case to the court within whose jurisdiction the property is situated.; that order 21 rule 48 is the only exception to the rule contained in order 21 rule 46 and that the exception cannot be enlarged to bring in the power contained in order 21 rule 52 c.p.c.; that the order for attachment of money lying outside the jurisdiction of the executing court was an acto of the court without jurisdiction.; that neither..........be the intention of the legislature.(15) an order for attachment of the property under order xxi rule 52 outside the territorial limits of the court's jurisdiction thereforee appears to me to be beyond the powers of the court.(16) learned judges of allahabad high court have observed in bhagwati prasad bajpai's (2) case that the provisions of section 39 are only of an enabling character. it may be so, although it does not seem necessary to decide that point in the present case. but there is a long line of cases in which it has been held that the rule of territorial jurisdiction which governs suits also governs execution of decrees though there are exceptions to that rule in promothanath malia v. h. v. low and co. (3) : air1930cal502 , it was stated as follows :- 'now,while there does.....
Judgment:

Hardyal Hardy, J.

(1) An interesting question of law with regard to the attachment of money lying with a public servant outside the territorial jurisdiction of the Court passing the decree, has been raised in this case.

(2) The decree-holder filed an execution application against the judgment- debtors in which he sought to attach the amount due to the judgment-debtors from the Assistant Engineer, Jatog Sub-Division, Himachal Pradesh, Simla. On the execution application, this amount was attached and received by the Commercial Subordinate Judge Delhi from Simla and the same was handed over to the decree-holder. One of the judgment-debtors, Shri Harbans Singh Sobti, Managing Director of Harbans Singh Sobti & Co. Private Limited, filed an objection petition under Order Xxi rule 58 Civil Procedure Code and Section 151 Civil Procedure Code . At the same time another application under Section 39 read with Section 47 and Section 151 Civil Procedure Code was filed for the restitution of the attached and appropriated amount of Rs. 850.00 to Messers Harbans Singh Sobti and Co., judgment-debtor No. 1. A preliminary point was raised in this application that the Court had no jurisdiction to attach the amount lying outside the territorial limits of its own jurisdiction and that the decree-holder had to apply for the transfer of the decree to the Courts at Simla to attach the amount in question. On this ground it was stated that the attached amount could not have been attached by the Court and that the same be refunded to Messers H.S. Sobti & Co.

(3) The learned Subordinate judge did not deal with the objection raised by H.S. Sobti & Co. that the amount was not due to Harbans Singh Sobti and Co. Private Limited but was due to a partnership firm which was distinct from the limited liability company. He proceeded on the assumption that the amount was due to the partnership firm, which was imp leaded as judgment-debtor No. 1.

(4) The sole question for determination thereforee was whether the Court of the commercial Subordinate Judge at Delhi had jurisdiction to attach the amount lying outside the jurisdiction of that Court and if that Court had authority what would be the effect of the same. Learned Subordinate Judge observed that if the garnishee was out-side the jurisdiction of the Court and the amount was also payable outside its jurisdiction no prohibitory order could be made against the garnishee unless it was specifically provided for in the Code of Civil Procedure. In the present case, the department concerned had its office at Simla and the amount was payable to the judgment debtor at Simla This Court, thereforee, according to the learned Subordinate Judge had no jurisdiction at Simla. Learned Subordinate Judge also held that even if it was presumed that the attachment was against the judgment- debtor, Harbans Singh Sobti & Co and not under Order Xxi Rule 46 of the Code of Civil Procedure then too the Court would have no jurisdiction to attach the amount at Simla. Relying upon a Full Bench decision, of the Madras High Court in Vasireddi Srimanthu and two others Vs Devabhaktuni Venkatappayya and another (2nd 1948 Madras 18) (1) where it was held that when a property sought to be attached is outside the jurisdiction of the Court which passes the decree the Court cannot attach it, but it must transfer the case to the Court within whose jurisdiction the property is situated.

(5) In this view of the matter the learned subordinate Judge came to the conclusion that the order of attachment passed by him attaching the amount in the hands of the Assistant Engineer, Himachal Pradesh P.W.D. Simla was an act of the Court without jurisdiction and as such he made an order directing the decree-holder to refund the amount of Rs. 850.00 under Section 47 as well as under Section 151 Civil Procedure Code .

(6) Against that order the decree-holder filed this revision petition and it is a matter of some regret that the petition which was admitted to regular hearing on 30th May 1964, and the operation of the order of the subordinate Judge was also stayed, has remained un-disposed of for over seven years. It may be that the magnitude of back-log which this Court has inherited from the Circuit Bench of the Punjab High Court at Delhi has prevented this Court from deciding this case earlier but the responsibility also lies on the counsel for the petitioner because it was only in the month of January 1971 that the petitioner took steps to have this case brought up for hearing. Strangely enough- the case was placed on 17th May 1971 before my brother B.C. Misra, J. but it was found that the learned Judge himself was a counsel for the petitioner in that case and he thereforee directed that the case be placed before another learned Judge.

(7) On behalf of the petitioner, reliance has been placed on a Bench decision of Allahabad High Court in Bhagawati Prasad Bajpai Vs Jai Narain Hanuman Das : AIR1958All425 where it was held that although the Code of Civil Procedure did not specifically provide that execution could not be had against property situate outside the jurisdiction of the executing Court to which an application is made, yet the rule of territorial jurisdiction which governs the suits also governs decrees. There are however certain exceptions to that rule. One of those exceptions recognises the right of the Court to appoint a receiver in connection with the execution of a decree in respect of property outside the jurisdiction of the executing court (see Promothannath Malia Vs H.V. Low and Co.

(8) Another exception is when Order Xxi rule 48 is applicable and where there is attachment of salary or allowances of public officers or servants of Railway company or local authority. In such a case, even though the judgment-debtor or the disbursi0ng officer is not within the jurisdiction of the Court, an order can issue under Order Xxi rule 48 of the Code. There is however a third exception where a direct attachment can be levied under Order Xxi rule 52 by the Court which passed the decree acting on its execution side against property which is beyond its jurisdiction, but is in the custody of a Court or an officer. In this view, it was held by the Learned Judges of Allahabad, High Court that order Xxi Rule 52 should be placed on a footing analogous to order Xxi Rule 48 of the code and should be taken out of the general rule of territoriality which has been engrafted into the court by judicial decisions.

(9) The view of Allahabad High Court has been followed by Jagat Narayan J. (as he then was) in Gayoor Ahmed Khan Vs Hazaima and others . . The same Judge sitting subsequently in a Division Bench of that court in Laxmi Narain and others Vs Finn Ram Kvnwr Suraj Bux and others (5) reiterated his earlier view and observed that the Court which passed the decree has jurisdiction to execute it directly even outside the territorial limits of its ordinary civil jurisdiction. Section 39 of the Code of Civil Procedure on which reliance was placed was merely an enabling provision and did not affect the jurisdiction of the Court.

(10) The decision of Allahabad High Court in BhagwatiPrasaii Bajpai Vs Jai Narain Hanuman Das (2) was rendered on 11-2-1958 while the decision of Jagat Narain J. in Gayoor Ahmed Khan Vs Hazarima and others (4) was delivered on 14-8-1964. The Bench in the case of Laxmi Narain and others Vs Firm Ram Kumar Suraj Bux and others (5) consisted of Jagat Narayan J. and R.D. Gattani J. This decision was given on 22-7-1970 and the judgment in both the cases of Rajasthan High Court was by Jagat Narayan J. Neither in the case before Allahabad High Court nor in the two cases of Rajasthan High Court an earlier decision of Rajasthan High Court in Hanuman Dutt Vs Hazarimal was adverted lo. In that case where the judgment was delivered on 12-11-57; K.N. Wanchoo, C.J. who wrote the judgment on behalf of himself and D.S. Dave, J. had taken a contrary view and at was held :-

'there is no doubt that there was an irregularity in this case inasmuch as the execution Engineer Bikaner was outside the jurisdiction of the court and the debt also appeared to have been payable outside the jurisdiction of the court. The proper procedure under the circumstances was for the Court to transfer the decree to the court having jurisdiction in Bikaner so that this money might be attached.

BYmistake, however, the court issued a notice under Order Xxi Rule 52 Civil Procedure Code to the Executive Engineer and that officer deposited the money in response to the notice in the court at Ratangarh. It was thereafter that the judgment- debtor objected that the attachment was illegal and thereforee, execution should not proceed against this money.'

(11) In a subsequent part of this decision the other aspect of the case was considered by the learned Chief Justice and to which a reference will be made by me later. But so far as the application of Order Xxi rule 52 Civil Procedure Code. is concerned the learned Chief Justice and D, S. Dave J. were definitely of the opinion that there was an irregularity in the matter of attachment and that a notice under Order Xxi rule 52 C. P.C. had been issued by the Court to the Executive Engineer Bikaner. by mistake. Not much reliance can thereforee be placed on the decisions of Allahabad High Court and Rajasthan High Court when there is a consensus of opinion among the other High Courts that Order Xxi rule 52 does not permit the court to issue any notice to a court outside its territorial limits for attachment of property or money which is in the custody of that court or public officer.

(12) In the case decided by Rajasthan High Court in which reliance was placed on the judgment of Allahabad High Court in Bhagwati Prasad Bajpais' case (2) the case of Gyarsilal v. Shankar Nao and others AIR 1950 Nag 46 was dissented from. In that case a learned single judge of that Court. Mangalmurti J. had taken the view that Order Xxi Rule 52 Civil Procedure Code. is not an exception to the general rule that territorial jurisdiction is a condition precedent to the Court executing a decree. There are no words in order Xxi Rule 52 which permit attachment of property outside the jurisdiction of the executing court us are found in Order Xxi rule 48 Civil Procedure Code. There is an earlier decision of that very court in Bisseserdas Daga and others v. Gabdumal Brahmin and another (8) where it was said that under Order Xxi rule 46 the executing court has no jurisdiction to pass any prohibitory order unless either the debt to be attached is within ihe territorial jurisdiction of that Court or the person against whom it is claimed resides within its jurisdiction. If under Order Xxi rule 46 even a prohibitory order cannot be issued by the court unless the debt to be attached is within the territorial jurisdiction of that court or the person against whom it is claimed resides within, its jurisdiction, it scams doubtful that the same power can be exercised by the Court under Order 21 rule 52 Civil Procedure Code. because the property to be attached is in the custody of the court or of a public officer residing outside the territorial limits of that court.

(13) It appears to me that Order Xxi Rule 48 is the only exception and that relates to the salary or allowances of a servant of the Government or of a servant of Railway company or local authority, no matter whether the judgment-debtor or the disbursing officer is or is not within the local limits of the court's jurisdiction. There are no such provisions in the case of property to be attached under Order Xxi rule 52. The absence of the words 'whether the judgment-debtor or the disbursing officer is or is not within the local limits of the court's jurisdiction' from rule 52 of Order Xxi is a clear indication of the fact that the power exercis. able under rule 48 of Order Xxi is the only exception and that it cannot be enlarged to bring the case within the purview of rule 52 of order XXI. The court or public officer under rule 52 appears to me to be a court or public officer within the territorial jurisdiction of the Court.

(14) A comparison of the language employed in rule 46 of Order Xxi with that in rule 52 of the said Order makes it plain that there is a broad distinction between attachment of moveable property in the possession of the judgment-debtor and the attachment of debts (other than negotiable instruments), shares in a corporation, or other moveable property not in the possession of the judgment-debtor, In the former case the attachment is effected by actual seizure while in the latter case it is done by prohibitory order. The service of prohibitory notice under rule 46 is enough for the attachment of the debt and it is not necessary that the money should be actually payable at the time to the judgment- debtor ( see : Imperial Bank of India v. Mt. Bibi Sayeedan : AIR1960Pat132 ) . But the executing Court has no jurisdiction to pass any prohibitory order under rule 46 unless either the debt to be attached is payable or the garnishee is within its jurisdiction. There is a reason for this rule as was said in Begg. Dunlop and Co. v. Jagannath Marwari ILT 39 Cal 104, 'in its essential elements a garnishment proceeding is a proceeding by the defendant in the suit against the garnishee, in the name and for the benefit of the plaintiff. . . .Wherever the garnishee could be sued by the defendant for the payment he may be charged as garnishee on account of it.' If thereforee a garnishee resides outside the jurisdiction of a court and the debt is also payable outside its jurisdiction, no prohibitory order can be made against the garnishee unless specifically provided for by the Court. Since the garnishment proceeding is a proceeding by the defendant in a suit against the garnishee, in the name and for the benefit of the plaintiff, such a suit can only be filed in the Court where the garnishee resides or the debt to be attached is payable. By attaching such a debt or such property even though it happens to be in the possession of the court or public officer who is outside the territorial limits of the court's jurisdiction the court, by exercise of its powers under Order Xxi rule 52 Civil Procedure Code., will be compelling the defendant to file a suit against the garnishee outside the territorial limits of the court where the garnishee resides or where debt or money to be attached is payable by him. This could not be the intention of the legislature.

(15) An order for attachment of the property under order Xxi rule 52 outside the territorial limits of the court's jurisdiction thereforee appears to me to be beyond the powers of the court.

(16) Learned Judges of Allahabad High Court have observed in Bhagwati Prasad Bajpai's (2) case that the provisions of Section 39 are only of an enabling character. It may be so, although it does not seem necessary to decide that point in the present case. But there is a long line of cases in which it has been held that the rule of territorial jurisdiction which governs suits also governs execution of decrees though there are exceptions to that rule in Promothanath Malia v. H. V. Low and Co. (3) : AIR1930Cal502 , it was stated as follows :-

'NOW,while there does not appear to be in the Code any express provision to the effect that immovable property shall only be sold by the Court within whose territorial jurisdiction it is situate. and, while it cannot be contended that there are not exceptions to this principle, it has frequently been held that the course contemplated by the Code is that sales of immovable property in execution shall be carried out by the local courts.

the leading case on this point is Prem Chand Dev v. Mokhoda Devi, 17 Cal 699. Following that case, in Begg. Dunlop and Co. v. Jagananath Marwari, 39 Cal 104 (10) it was said 'These provisions of S. 38, read along with those of S. 39, plainly indicate the acceptance by the legislature of the general principle that no court can execute a decree in which the subject-matter of the suit or of the application is property situated entirely outside the local limits of its jurisdiction.'

(17) This shows that so far as Calcutta & Nagpur High Courts are concerned they are of the same view. The view of Madras High Court is also on the same lines. In Sivaskanda Raju v. Raja of Jeypore AIR 1927 Mad 627 the position was summarised as below:-

'the proposition generally laid down in the reported authorities is that a court has no power to sell property outside its territorial jurisdiction. Territorial jurisdiction is ' a condition precedent to the court selling property.' Again in the recent case of Ambika Ranjan Majumdar v. Manikganj Loan Office Ltd. : AIR1929Cal818 , it was said 'Where it is necessary, in execution of a decree for money to sell properties not within the local limits of the jurisdiction of the court which passed the decree, the sale of the properties can only be effected by the court within the local limits of which the property is situate.'

(18) The learned Judges were however of the view that the rule, as indicated by them, did not affect the right, of the court to appoint a receiver in connection with the execution of a decree in respect of property outside the jurisdiction of the executing court. In Veerappa Chetty Ramaswamy Chetty AIR 1920 Mad 505, learned Judges of the Madras High Court held that a court to which execution of decree is transferred has no jurisdiction to order either the sale or attachment of immovable properties in execution, if at the time of the order such court had no territorial jurisdiction over the immovable properties.

(19) In O. V. Belusami v. 0fficia1 Assignee, Madras and others AIR 1939 Mad 811 a Single Judge of Madras High Court took the the same view on a prohibitory order issued under Order Xxi rule 46 to the official assignee by a court outside its jurisdiction, directing the official assignee not to pay dividend due to creditor of insolvent. It was held that such an order was invalid because such an order could only made by the High Court itself within whose jurisdiction the official assignee is.

(20) In Vesireddi Srimanthu and others Vs Devabhaktuni Venkatappaya and another (AIR 1948 Mad 347a Full Bench of the Madras High Court held that Section 39 Civil Procedure Code made it very clear that a court passing a decree must have territorial jurisdiction in respect of property against which it can order execution. If it has not got jurisdiction it cannot order execution and must send the decree for that purpose to the court competent to do so. The exceptions contained in Section 17 and Order 21 rule 3 were the only exceptions so far as immovable property was concerned.

(21) In Gowrammal Vs Lingappa Gowader : AIR1968Mad99 a Division Bench of the same High Court had to consider a case where the subject-matter of a suit was transferred due to a change in the territorial jurisdiction of a court. The question was whether the transferee court acquired inherent jurisdiction over the subject-matter. Relying upon a decision of the Supreme Court in Ramanna Vs Nallappa Raju : [1955]2SCR938 it was held that the transferee court could entertain execution applications relating thereto and execute the decree even though the decree was not transferred to it by the decreeing court. This principle could not be applied to money decrees. In case of money decrees, if the executing court is not the decreeing court, the decree must be transferred to it by a proper transmission from the decreeing court before it can be executed. There seems to be a valid reason for this rule regarding money decrees because so long as the decreeing court continues to exist, it has jurisdiction over the decree it has passed and hence a transfer of the decree is necessary before it can be executed by the executing court.

(22) These authorities also go to show that the view of Madras High Court is in line with that of Calcutta High Court and Nagpur High Court.

(23) The view of Traavancore-Cochin High Court also appears to be the same. in Padmanabha Pillai Bhaskara Pillai Vs Bank of Kerala Limited AIR 1956 T C 100; a Division Bench of that Court held that if the garnishee was residing outside the jurisdiction of a court, it was not competent in execution of a decree for money to attach a debt payable to the judgment-debtor. Such a debt could only be attached, if it was payable within the jurisdiction of the court or the garnishee was within its jurisdiction and not otherwise.

(24) The view of Lahore High Court also is on the same lines. In a Single Bench judgment of Jai Lal J. in Bilas Mal Damodar Dan and others Vs Hari Das and others AIR 1929 Lah 645,it was held that it was not competent under Order Xxi rule 46 to effect an attachment of property movable or immovable outside the jurisdiction of the court except in the case of attachment made under Order Xxi rule 48. Civil Procedure Code .

(25) In this view of the matter. I am inclined to follow the view of Calcutta,. Madras, Lahore and Travancore-Cochin High Courts in preference to the views of a Division Bench judgment of Allahabad High Court in Bhagwati Prasad Bajpai's case and of Rajasthan High Court in Laxmi yarain and others Vs Firm Rain Kumar Suraj Bux and odiers.

(26) The first part of the order made by the learned subordinate Judge has thereforee to be maintained.

(27) The next question is that if there was some irregularity in the attachment of the money, as it obviously was, whether the subordinate- judge could order refund of the amount to the objecting judgment- debtor. The relevant facts are that the garnishee himself has not objected to the money being sent from Simla to Delhi. The objection was filed by the objecting judgment-debtor after the money was paid to the decree-holder. Even in the application under Order Xxi rule 58 filed by the objecting judgment-debtor no objection as to jurisdiction was taken. It is only subsequently after the amount was actually paid to the decree-holder that an application under Section 39 read with Section 47 and Section 151 Civil Procedure Code was filed for the restitution of attached and appropriated amount. In such circumstances, it seems lo me that such an objection could not be entertained. I am rather inclined to agree with the Division Bench of Rajasthan High Court in Hanuman Dutt Vs-Hazarimal AIR 1951B Raj. 235 and I am of the view that where there has been an irregularity in the attachment and as a result of that irregularity the interest of the third party is affected. be. he a garnishee or a co-decree-holder, he can certainly object to the attachment before the money is paid in Court. But where, after the, money is paid into the court and the judgment-debtor comes forward to object on the basis of some irregularity in the process of attachment the court should not allow the judgment debtor to raise such an objection, for that would be allowing him to abuse the process of the court.

(28) Learned subordinate Judge has however relied upon a decision of the Supreme Court in B. V. Patankar and others Vs C.G. Sastry : [1961]1SCR591 . The Court in that case was concerned with the executing court having ignored the provision of the Rent Control Order prohibiting the eviction of tenants and passed an order of delivery of possession in execution of a decree. It was held that the order could be set aside and an order of re-delivery to the tenants could be passed on an application under Section 47 read with Section 151 Civil Procedure Code That was a case of breach of mandatory provision of law. The executing court could not have passed an order of eviction of tenants under the Rent Control Order. That situation does not obtain in the present case. The attachment of the money in the hands of a garnishee at Simla was no doubt irregularity but once the money had reached the Court of Subordinate Judge at Delhi and the garnishee had not objected to it nor had the judgment-debtor raised any objection to the attachment of the money, the Court could certainly award the amount to the decree-holder, the objection of the judgment-debtor being belated.

(29) In the result, the second part of the order made by the subordinate Judge is set aside. The decree-holder can retain the money in execution of the decree. The revision is accepted but in the circumstances there will be no order as to costs.


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