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Subrayan Chettiar Vs. Kochuvarkey - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKerala High Court
Decided On
Case NumberA.S. No. 4 of 1957
Judge
Reported inAIR1959Ker18
ActsCode of Civil Procedure (CPC) , 1908 - Sections 95
AppellantSubrayan Chettiar
RespondentKochuvarkey
Appellant Advocate T. Chandrasekhara Menon, Adv.
Respondent Advocate Rama Iyer, Adv.
DispositionAppeal dismissed
Cases ReferredNarasimham Potty v. Easwara Iyer
Excerpt:
.....has certainly got the attachment raised on 28-7-1953 and therefore, even the test laid down by the learned judges of the calcutta high court appears to be satisfied in this case. the learned judge observes at page 353: it is not pretended that the application was based on anything that appeared in the trial of the suit (which actually took place in march 1921). it is doubtful whether an award of compensation can be made in a case where the order of injunction was passed after hearing both the parties and it was found that there were sufficient grounds and the plaintiff has not ultimately failed in his suit, (see ronlet v. in this case, even the test laid down by the learned judge is satisfied and more than that the court has got fresh materials in the application made under section 95 to..........kariasthan as c. p. w. 1 justifying the application for attachment, has not been accepted by the learned judge. the said witness was not able to say as to what were the circumstances which led him to believe that the defendant was attempting to alienate his properties. the learned judge has also stated that no evidence has been placed before the court to show that the properties of the defendant have been attached by any other creditor or about his trying to alienate the properties to third parties with a view to defeat the plaintiffs claim. the learned jndge has also held that the whole attachment proceedings taken by the plaintiff were not certainly with a bona fide intention to secure the properties for his benefit as and when he gets a decree: but the application has been filed on.....
Judgment:

Vaidialingam, J.

1. The appeal arises out of proceedings instituted by the defendant in O. S. 181/1123, District Court, Anjikaimal for compensation under Section 95, C. P.C. There is no controversy about the facts leading up to that application. The appellant before us was the plaintiff in the said suit and the respondent herein was the defendant therein. The suit itself was for recovery of a sum of Rs. 10,000 from the appellant. After filing the said suit, the plaintiff filed M. P. 1860 of 1123 and asked for attachment before judgment of the defendant's properties under Order 38, Rule 5, C. P. C. The allegations made in the petition for attachment before judgment were that the defendant is heavily involved and that he is trying to alienate the properties to defeat and delay the plaintiff's claim. An order of interim attachment was made on the same date and notice was issued to the defendant. He filed on 29-12-1123 M. P. 2100/1123 for raising the order of attachment. He has stated therein that the allegations mentioned in the affidavit for attachment before judgment were all false. He also emphatically denied the allegation that he had any intention of disposing of the whole or any part of his properties with intent to obstruct or delay the claims of the plaintiff. He also disputed his liability to the plaintiff.

2. Both these applications were considered together and on 27-2-1124, the interim order of attachment was made absolute. The suit itself was decreed on 31-3-1953 only to the extent of about Rs. 600 as against the claim of the plaintiff for about Rs. 10,000. The defendant filed M. P. 1446/53 on 27-7-53 for withdrawing the order of attachment under Order 38 Rule 9 on the ground that the suit itself has been substantially dismissed. On 28-7-1953, the order of attachment was withdrawn by the court; but the plaintiff filed on 1-9-1953 M. P. 1753/53 for reviewing the order withdrawing the attachment. On 11-11-1954, the said application was dismissed.

3. The plaintiff filed an appeal against thedecree in the suit and even in the appellate court,the plaintiff again sought to attach these properties.The defendant gave an undertaking not to alienatesome items and on that undertaking, the plaintiff'sapplication was dismissed. The appellate courtultimately confirmed the decree of the trial court inall respects and dismissed the appeal with costs ofthe defendant.

4. After all these proceedings, the defendant filed M. P.. 116/1124 for compensation under Section 95, C. P. C., on the allegation, that the plaintiff applied for an order of attachment before judgment on insufficient grounds. The defendant further alleged that he had no idea at all of defeating or delaying any of bis creditors or the plaintiff and that he hasnot done any acts to alienate or secret any of his properties. Though the plaintiff was fully aware of these circumstances 'nevertheless, on insufficient grounds, he applied for attachment before judgment and in consequence, the defendant has lost his credit in the estimation of the public and has sustained loss in his business as Abkari Contractor and he claimed a sum of Rs. 1,000/- as and for damages.

5. This application was contested by the plaintiff on the ground that the attachment proceedings taken out by him were all perfectly legal and bona fide and on proper grounds. The very fact that the court confirmed the injunction order of attachment clearly shows that the application for attachment before judgment was well founded. On the facts also, he stated that the defendant had several debts and that he was attempting to alienate the properties with a view; to defeat his claims. He also contended that the defendant is not entitled to any damages unelss he is able to satisfy the court that he has incurred special damages in consequence of the attachment.

6. The learned District Judge, Anjikaimal, after a consideration of all the circumstances came to the conclusion that the attachment was applied for by the plaintiff on insufficient grounds. He has also severely commented about the absence of the plaintiff from the witness-box. The evidence of the plaintiff's Kariasthan as C. P. W. 1 justifying the application for attachment, has not been accepted by the learned Judge.

The said witness was not able to say as to what were the circumstances which led him to believe that the defendant was attempting to alienate his properties. The learned Judge has also stated that no evidence has been placed before the court to show that the properties of the defendant have been attached by any other creditor or about his trying to alienate the properties to third parties with a view to defeat the plaintiffs claim. The learned Jndge has also held that the whole attachment proceedings taken by the plaintiff were not certainly with a bona fide intention to secure the Properties for his benefit as and when he gets a decree: but the application has been filed on very insufficient grounds.

According to the learned Judge, the plaintiff has not cared to ascertain the real facts before filing the application for attachment and it has been filed on very vague grounds which could not be substantiated by the plaintiff's witness, C. P. W. 1. On these grounds, the learned Judge came to the conclusion that the attachment was applied for by the plaintiff on insufficient grounds within the meaning of Section 95. C. P. C. On the question of the award of damages, the learned Judge has again held that in consequence of the attachment procured by the plaintiff, the defendant did sustain an injury and awarded a sum of Rs. 200/- as damages against his claim for Rs. 1,000/-.

7. The plaintiff has filed this appeal against this award of damages as against him.

8. Mr. T. Chandrasekhara Menon, learned counsel for the appellant, raised two contentions before us: The confirmation of the order of attachment on 27-2-1124 in spite of the defendant applying for vacating the interim order of attachment, bars the defendant in law from agitating the matter ever again in proceedings under Section 95, C. P. C. and (2) that unless the defendant proves that he sustained any special damages, no damages should have been awarded under Section 95, C. P. C.

9. On the other hand, Mr. Rama Ayyar, learned counsel for the defendant-respondent, contended that the jurisdiction exercised by a court under Order 38 Rule 5, C. P. C., and the jurisdiction of the courtin exercising powers under Section 95, C, P. C., are entirely different. The fact that his client attempted to have the order of attachment raised and failed in that attempt does not bar his client from taking action under Section 95, C. P. C., if he is able to satisfy the court that the application for attachment was made on insufficient grounds. Secondly, the learned counsel also contended that the defendant in such cases, is not bound to prove any special damages. Without proof of any special damage, the court can award general damages under Section 95 to the extent specified therein.

10. Mr. Chandrasekhara Menon referred us to certain decisions bearing on this matter. In Satish Chandra v. Munilal, AIR 1932 Cal 821 (A), Rankin C. J. and Ghose, J. held that where an order of attachment before judgment has not been vacated, the rightness or wrongness of the said order cannot be canvassed in a subsequent suit for damages for malicious prosecution. Apart from the fact that the decision is not one under Section 95, C. P. C., we must also point out that Section 95 does not seem to contemplate any such distinction. Even otherwise, on the facts, the plaintiff in those proceedings who obtained the order of attachment, appears to have succeeded and obtained a decree in his favour. In the case before us, the defendant has certainly got the attachment raised on 28-7-1953 and therefore, even the test laid down by the learned Judges of the Calcutta High Court appears to be satisfied in this case.

11. The next decision relied upon by Mr. Chandrasekhara Menon is again one of the Calcutta High Court reported in Chandulal Siraogi v. Purna Chandra Paul, 39 Cal WN 915 (B). In that case, after the order of attachment was made absolute after notice to the defendant the latter, some days later, deposited the amount of the claim and had the attachment withdrawn. He did not also contest the suit and there was a decree as prayed for by the plaintiff. Thereafter, the defendant filed an application under Section 95 for compensation. A reading of the judgment shows that the learned Judge was of the opinion that even under those circumstances, an application under Section 95 is maintainable by the defendant. The only question that was considered by the learned Judge was as to how exactlv the damages are to be arrived at.

Though certain Madras decisions appear to have been quoted regarding the principles governing damages, the learned Judge felt bound by the decision of the Calcutta High Court and held that the defendant must show that some damage has been caused to him as the proximate result of the attachment. In this view, the learned Judge negatived the defendant's claim. Therefore, in our opinion, this decision does not support Mr. Chandrasekhara Menon in respect of his first contention. As to whether it can be accepted as an authority regarding the question of damages, will be considered later.

12. The next decision relied upon by the learned counsel is the one in Cyan Prakash v. Kishori Lal. AIR 1942 All 281 (C), a decision of Yorke J. The learned Judge in that case has held that an application under Section 95 is not maintainable unless the order of attachment in respect of which the application is made, has been already set aside by the court as having been made on insufficient grounds. Regarding the decision of the Calcutta High Court in AIR 1932 Cal 821 (A) already referred to, the learned Judge holds that the principles laid down in the Calcutta case were laid down in a suit and not in an application under Section 95 C P C But nevertheless, the learned Judge took the view that those principles applied also to questions arising under Section 95, C. P. C.

13. In the Allahabad case also it will be seen that the defendant complied with the order of attachment and deposited the money which became ultimately available to the plaintiff in satisfaction of his decree. In these circumstances, the learned Judge held that the defendant not having got the order of attachment set aside on the ground that it was obtained on insufficient grounds, is not entitled to file an application under Section 95.

14. In our opinion, this decision, if we may say so with respect, takes a too restricted view of the powers under Section 95; We are not able to find any support from the wording of the section for this line of reasoning. In fact, the whole question whether the attachment was applied for on insufficient grounds is a matter to be gone into in proceedings taken under Section 95 alone. In fact, the section does not even say about obtaining an order on insufficient grounds as the learned Judge states on p. 263 of the reports. What is required under Section 95 is to find out whether the plaintiff applied for attachment on insufficient grounds.

15. The next decision relied upon by the learned counsel is that of Mr. Justice Ramesam reported in Venkatappayya v. Venkatappayya, AIR 1923 Mad 352 (D). In that case, the defendant to whom notice had been issued, appeared and opposed the application of the plaintiff for an interim injunction. The court directed the injunction to be dissolved on the defendant furnishing security or depositing the amount. A few days later, the defendant furnished security and the injunction was dissolved. Sometime later, the defendant filed an application for compensation under Section 95. The suit itself was actually tried about 2 years later. The learned Judge observes at page 353:

'It is not pretended that the application was based on anything that appeared in the trial of the suit (which actually took place in March 1921). It is doubtful whether an award of compensation can be made in a case where the order of injunction was passed after hearing both the parties and it was found that there were sufficient grounds and the plaintiff has not ultimately failed in his suit, (see Ronlet v. Fetterlc. ILR 18 Bom 717) (E). But assuming that even where after an order was made on hearing both parties and the plaintiff has ultimately succeeded, a petition lies under Section 95 for compensation -- such cases must be very rare indeed --the stage for such an application would be only when the suit is heard. Up to then, such a petition would he premature (see M. R. M. V. L. Firm of Madura v, Krishnaswamy Ayyar, 38 Mad LJ 324: (AIR 1920 Mad 397)) (F).'

In our opinion, the observations of the learned Judge extracted above do not in any way assist Mr. Chandrasekhara Menon. These observations, in our opinion, do show that there can be cases where an order of attachment or injunction is made absolute after hearing both parties and the plaintiff ultimately succeeds; nevertheless an application under Section 95 can be filed by the defendant. According to the learned Judge, the stage for such an application would be when the suit is heard. In this case, even the test laid down by the learned Judge is satisfied and more than that the court has got fresh materials in the application made under Section 95 to find out whether the plaintiff applied on insufficient grounds.

16. The last decision referred to by the learned counsel is the decision of the learned Chief Justice Mr. Beasley of the Madras High Court reported in Rama Mudali v. Marappa Goundan, AIR 1934 Mad 638 (G). In that case, the order of attachment was made absolute after hearing both parties. Before the suit was disposed of, the defendant applied for compensation for wrongful attachment. It is alsoultimately seen that the suit itself was decreed in favour of the plaintiff. The learned Chief Justice held that the application for compensation could not be made until in appropriate proceedings the order of attachment had been set aside and as such held in that case that the defendant was not entitled to apply. This view has not been accepted even in Madras as will be shown later. With great respect, there is no discussion of the point in this judgment regarding the powers of the court exercising jurisdiction under Section 95. Even if the test laid down by the learned Judge is to be accepted, in this case, there has been a final order raising the attachment on 2S-7-1953.

17. Mr. Chandrasekhara Menon again relied upon some of these decisions quoted by him to show that the defendant must prove special damages before any damages could be awarded to him under Section 95. We are not able to see on what basis such a principle could be inferred in the language of Section 95. The authority relied upon by Mr. Chandrasekhara Menon is the one in 39 Cal WN 915 (B). With great respect to the learned Judge of the Calcutta High Court, we are not able to find anything in the wording of Section 95 requiring the applicant therein to prove special damage. The section is quite clear namely, that the court can award reasonable compensation to the defendant for the expense or injury caused to him.

18. In this case, the lower court has considered all the aspects in awarding damages of Rs. 200/-and Mr. Chandrasekhara Menon has not been able to attack the reasoning of the learned Judge as such.

19. Mr. Rama Ayyar, learned counsel for the defendant-respondent, has also invited our attention to certain decisions bearing on the point. In Palaniandi Monpan v. Pachi Palaniyandi Moopan, 1931 Mad WN 956 (H) Mr. Justice Cornish had to consider the applicability of Section 95, C. P. C., where an order of attachment was made absolute after hearing the defendant. Sometime thereafter, the defendant filed an application under Section 95 and the suit itself ultimately resulted in a decree in favour of the plaintiff. Nevertheless, the trial court awarded damages to the defendant on the ground that the plaintiff had applied for attachment on insufficient grounds. This order was confirmed in appeal by the Subordinate Judge.

20. In the High Court, it was contended by the plaintiff that inasmuch as the order of attachment was made absolute under Order 38. C. P. C., the court has no jurisdiction to entertain the application for compensation under Section 95. Before the learned Judge, the decision of Mr. Justice Ramesam in AIR 1923 Mad 352 (D), referred to earlier, was also quoted but Mr. Justify Cornish held that the reasoning of Mr, Justice Ramesam must be confined to the particular facts before that learned Judge.

21. After quoting Section 95, on page 957, the learned Judge observes:

'In my opinion, the right under Section 95 to give compensation is independent of the passing of a prior absolute order of attachment .... In my view, therefore, it was competent to the court on this application to make the order, for compensation.'

We respectfully agree with the reasoning of Mr. Justice Cornish.

22. A similar question arose again before Mr. Justice Wadsworth in the decision reported in Palanisami v. Kaliappa, AIR 1940 Mad 77(I). The learned Judge was not inclined to accept the decision of the learned Chief Justice Mr. Beasley in the deci-sion reported in AIR 1934 Mad 638 (G). The learned Judge accepted and followed the decision of Mr. Justice Cornish reported in 1931 Mad WN 956 (H), The learned Judge, after considering these two decisions, observes at p. 78:

'I assume, therefore, that the setting aside of the order of attachment is not an essential preliminary to the grant of compensation'.

With respect, we follow the decision of Mr. Justice Cornish in 1931 Mad WN 956 (H) and that of Mr. Justice Wadsworth in AIR 1940 Mad 77 (I) and hold that the fact that the order of attachment was made absolute after hearing the defendant will not preclude the defendant from talcing proceedings under Section 95, C. P. C. In our opinion, the jurisdiction exercised by the court must be considered in terms of the clear language of Section 95 C. P. C., and the said section does not in any way, place any restriction as held by sonic of the decisions referred to above. In particular, we may refer to the following observations of Mr. Justice Wadsworth in the decision in AIR 1940 Mad 77 at p. 78(1):

'It does seem to me that the requirements of an application under Section 95 should be based on the language of the section and not on rules obtaining in Common law with reference to a similar but no identical Common law remedy.'

The learned Judge on the same page, with reference to the decision in AIR 1934 Mad 638 (G) observes at page 78 again as follows:

'But it seems to me that DO such preliminary step has been prescribed in Section 95 which alone governs the procedure in a summary application for compensation for wrongful attachment. I doubt whether one would be justified in hedging this remedy round with restrictions which the section itself does not import.'

We are in complete agreement with this reasoning of the learned Judge regarding the interpretation to be placed on Section 95.

23. Therefore, the fact that the order of attachment has been made absolute in the presence of the defendant or that it has not been set aside is not a bar for the defendant applying under Section 95. But we should not be understood as laying down that all these aspects cannot be considered by the court in disposing of an application under Section 95,

24. Coming to the second aspect, we have already disagreed with the contention of Mr. Chandra-sekhara Menon that special damages must be proved. If the decision in 39 Cal WN 915 (B) is understood as laying down the principle that special damages must be proved with great respect, we are not able to agree with the said decision. In Nanjappa Chettiar v. Ganpathi Gounden, ILR 35 Mad 598 (J), Sundara Ayyar and Phillips, JJ., in dealing with the contention that a party claiming compensation for wrongful attachment or arrest etc., must prove some kind of special damage to entitle him to get relief, the learned Judges after stating that they cannot accept such a contention, observed at p. 605 as follows:

'We cannot doubt that the attachment of a respectable man's property before judgment on the ground that he is attempting to alienate his properties with a view to defeat his judgment-creditors must in this country damage his reputation and credit. It is immaterial that it is not proved that they were affected in some specific manner......'

25. To a similar effect is the decision in Nicholas v. Sivarama Iyer, ILR 45 Mad 527: (AIR 1922 Mad 206) (K). Both these decisions held that special damage need not be proved in a suit for damages for wrongful attachment. If so, we fail to see why a different principle should be adopted in respect of applications under Section 95. We may also refer again to the decision of Mr. Justice Wadsworth reported in AIR 1940 Mad 77 (I) adverted to earlier regarding the first contention of the appellant, the learned Judge had also to consider me principles regarding the award of damages under Section 95. After considering the decisions of the Madras High Court in ILR 35 Mad 598 (J); ILR 45 Mad 527: (AIR 1922 Mad 206)(K) and that of the Calcutta High Court in 39 Cal WN 915 (B), the learned Judge was not prepared to accept the Calcutta view. The learned Judge observes at page 79 of the reports:

'I see nothing in the language of Section 95 to justify the inference that special damage need be proved in application under Section 95 for a similar relief. The remedy being statutory, one is entitled to look to the words of the section itself in order to ascertain whether it is necessary to prove special or particular damage flowing from the attachment. It seems to me that the words expense or injury indicate that either the particular damage upon which a monetary value can obviously be placed or the more general damage which the court endeavours with difficulty to assess in terms of money, is contemplated by the section.'

We are again in full agreement with the reasoning of Mr. Justice Wadsworth as also the decisions of the Madras High Court in ILR 35 Mud 598 (J) and ILR 45 Mad 527: (AIR 1922 Mad 206) (K):

26. To a similar effect are the decisions reported in Siva Rama Deekshithar v. Siva Ramakrishna Vadnyar, 4 Cochin 3 (L) and Muhamed Methar v. Sreenivasa Tver, 27 Cochin 455 (M). The decisions in ILR 35 Mad 598 (1) and ILR 45 Mad 527: (AIR 1922 Mad 206) (K) have been approved by the Travancore-Cochin High Court in the decision reported in Narasimham Potty v. Easwara Iyer, ILR 1956 Trav-Co. 324 (N). It may also be stated that one of us (Koshi, C. J.) was a party to the said decision. We are in complete agreement with the principles laid down in these decisions.

27. Therefore, we also hold that the defendant is not bound to prove special damages in an application under Section 95 C. P. C. Therefore, both the legal contentions of Mr. Chandrasekhara Menon fail.

28. Regarding the actual merits of the decision of the lower court, as stated earlier, Mr. Chandrasekhara Menon was not able to attack them in any manner. The learned Judge has found that the plaintiff applied for attachment on insufficient grounds and he has given sufficient reasons in support of this finding. Regarding the damages, the learned Judge has again considered all aspects and awarded only a sum of Rs. 200/- as against his claim for Rs. 1,000/-. We entirely agree with the findings of the learned Judge on both these points,

29. In the result, the appeal fails and is dismissed with costs.


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