Union Of India vs Hira Devi - 1952 Supreme(SC) 42

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

1952 Supreme(SC) 42

SUPREME COURT OF INDIA
MAHAJAN, CHANDRASEKHARA AIYAR AND BOSE JJ.
Union of India, Appellant
Versus
Smt. Hira Devi and another, Respondents.
Civil Appeal No. 132 of 1951.
21st May 1952.
Advocates appeared
Shri M. C. Setalvad, Attorney-General for India (Shri B. Sen, Advocate, with him), instructed by Shri P. A. Mehta, Agent, for Appellant; Shri Naziruddin Ahmad, Senior Advocate (Shri Nuruddin Ahmad, Advocate, with him), instructed by Shri Naunit Lal, Agent (for N. 1); Shri S. N. Mukherjee, Advocate, (instructed by Shri P. K. Chatterjee, Agent (for No. 2). For Respondents.

Advocates:
B.SEN, M.C.SETALVAD, NAUNIT LAL, NAZIRUDDIN AHMAD, NURADDIN AHMAD, P.A.Mehta, P.K.CHATTERJI, S.N.MUKHERJEE

Headnote:PROVIDENT FUND MONEY - ARREARS OF SALARY AND ALLOWANCE - COMPULSORY DEPOSITS UNDER PROVIDENT FUND
       -in respect of Provident Fund money the prohibition against the assignment or attachment of such compulsory deposit is absolute
       -are not attachable as held in Union of India v. Hira Devi, AIR 1952 SC 227; Union of India v. Radha Kissen, AIR 1969 SC 762; Union of India v. J.C. Fund and Finance, AIR 1976 SC 1163. = (1976) 3 SCC 607=(1976) 3 SCR 763.

Judgement Key Points

Certainly. Based on the provided legal document, here are the key points:

The case involves the execution of a decree where a Receiver was appointed to collect funds from a judgment-debtor's Provident Fund account (!) (!) .
The judgment-debtor's Provident Fund includes a compulsory deposit, which is defined as a subscription or deposit that is not, until a specified contingency, repayable on demand and includes contributions, interest, or increments accrued under the fund's rules (!) .
Such compulsory deposits are protected by law from attachment or assignment, as they are intended to serve a public policy purpose, making them inalienable and non-attachable under the applicable statutes (!) (!) .
The absolute prohibition against attaching or alienating Provident Fund deposits is rooted in the objective of safeguarding the funds for the benefit of the subscriber, and circumventing this prohibition by appointing a Receiver to reach these funds is not permissible (!) (!) .
The appointment of a Receiver to seize or apply Provident Fund money in execution of a decree is generally inconsistent with the statutory protections and the policy underlying the law, although salary arrears (not part of the Provident Fund) are distinguishable and can be proceeded against in execution (!) (!) .
The case clarifies that arrears of salary due to a judgment-debtor can be subject to execution proceedings, but the Provident Fund amount, being protected by law, cannot be reached through the appointment of a Receiver (!) (!) .
The decision emphasizes that the statutory protections against attachment and alienation are absolute for Provident Fund deposits, and any attempt to bypass these protections through equitable remedies like Receiver appointment is not valid (!) (!) .
The Court set aside the lower court’s order appointing a Receiver concerning the Provident Fund amount, reaffirming that such funds are exempt from attachment and sale under the law (!) .
The ruling distinguishes between different types of funds and income, clarifying that salary arrears are not protected in the same manner as Provident Fund deposits and can be attached in execution proceedings (!) .
The appeal was allowed, and the order appointing a Receiver over the Provident Fund amount was set aside, with the government ordered to pay the costs of the appeal (!) .

Please let me know if you need further analysis or specific legal advice regarding this case.

Judgment

CHANDRASEKHARA AIYAR, J.: This Court granted special leave to appeal in this case on the Government agreeing to pay the costs of the respondents in respect of the appeal in any event.

2. The decree-holder was a lady named Hira Devi. The judgment-debtor was one Ram Grahit Singh, who retired on 31-1-1947 as a Head Clerk in the Dead Letter Office. Calcutta. A money decree was obtained, against him on 30-7-1948. On 1-2-1949, a Receiver was appointed for collecting the moneys standing to the credit of the judgment-debtors in a Provident Fund with the Postal authorities. The Union of India intervened with an application dated 20-9-1949 for setting aside the order appointing the Receiver.

3. Mr. Justice Bannerjee dismissed the application of the Union of India, holding that a Receiver could be appointed for collecting the fund. On appeal, Trevor-Harries. C. J. and Sinha J. upheld his view.

4. From the facts stated in the petition filed by the Union of India before the High Court, it appears that a sum of Rs. 1,394-13-1 represents arrears of pay and allowances due to the judgment-debtor and a sum of Rs. 1,563 is the compulsory deposit in his Provident Fund account. Different considerations will apply to the two sums, though in the lower Court the parties seem to have proceeded on the footing that the entire sum was a "compulsory deposit" within the meaning of the Provident Funds Act, 1925.

5. The main question to be decided is whether a Receiver can be appointed in execution in respect of Provident Fund money due to the judgment-debtor.

6. Compulsory deposits and other sums in or derived from any fund to which the Provident Funds Act XIX (19) of 1925 applies are exempt from attachment and sale under S. 69 (k), Civil Procedure Code.

7. "Compulsory deposit" is thus defined in S. 2 (a) of the Provident Funds Act XIX (19) of 1925:

"Compulsory deposit means a subscription to, or deposit in a Provident Fund which under the rules of the Fund, is not, until the happening of some specified contingency repayable on demand otherwise than for the purpose of the payment of premia in respect of a policy of life insurance (or the payment of subscriptions or premia in respect of a family pension fund), and includes any contribution, and any interest or increment which has accrued under the rules of the fund on any such subscription, deposit, contribution, and also any such subscription, deposit, contribution, interest or increment remaining to the credit of the subscriber or depositer after the happening of any such contingency."

8. Such a deposit cannot be assigned or charged and is not liable to any attachment. Section 3 (1) of the said Act provides:

3 (1) "A compulsory deposit in any Government or Railway Provident Fund shall not in any way be capable of being assigned or charged and shall not be liable to attachment under any decree or order of any Civil, Revenue or Criminal Court in respect of any debt or liability incurred by the subscriber or depositor, and neither the Official Assignee nor any receiver appointed under the Provincial Insolvency Act, 1920 shall be entitled to or have any claim on any much compulsory deposit."

9. It is obvious that the prohibition against the assignment or the attachment of such compulsory deposits is based on grounds of public policy. Where the interdiction is absolute, to allow a judgment creditor to get at the fund indirectly by means of the appointment of a receiver would be to circumvent the statute. That such a frustration of the very object of the legislation should not be permitted was laid down by the Court of Appeal as early as 1886 in the case of LUCAS v. HARRIES , (1887) 18 Q B D 127, where the question arose with reference to a pension payable to two officers of Her Majesty s Indian army. S. 141 of the Army Act, 1931 provided:

"Every assignment of, and every charge on and every agreement to assign or charge any ...... pension payable to any officer or solider of Her Majesty s forces, or any pension pa

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