2016 Supreme(AP) 226
M.SEETHARAMA MURTI
Y. Kesavulu – Appellant
Versus
T. Kalavathi – Respondent
Advocates Appeared:
For the Petitioner:V.S.R. Anjaneyulu, Advocate
For the Respondent:O. Uday Kumar, Advocate.
Judgement Key Points
- The suit was filed for recovery of Rs.10,00,000/- based on a promissory note executed by the defendant, who allegedly borrowed the amount for family needs and construction. (!) (!)
- Plaintiff applied under Order XXXVIII Rule 5 CPC for attachment before judgment of defendant's residential property, alleging the defendant was attempting to alienate it to defeat the decree. (!) (!) [2000479230007]
- Trial court issued ex-parte interim order directing defendant to furnish security of Rs.11 lakhs or show cause within 48 hours, failing which the property would be attached. (!)
- Defendant denied the loan and promissory note as forgery, filed counter and IA under Order XXXVIII Rule 5 read with Section 151 CPC with undertaking not to alienate the property till suit disposal, seeking to lift interim attachment. (!) (!)
- Trial court allowed defendant's IA, accepted the undertaking, and raised the interim attachment order. (!) (!) (!)
- Plaintiff filed revision petitions under Article 227 of the Constitution challenging both trial court orders. (!) (!)
- Order XXXVIII Rule 5 CPC allows court, if satisfied by affidavit that defendant intends to obstruct decree execution by disposing or removing property, to direct defendant to furnish security or show cause, with conditional attachment possible. (!) (!) (!) (!) (!) (!) (!) (!) (!)
- Attachment before judgment is a drastic power, exercised sparingly where plaintiff shows prima facie case and defendant's intent to dispose/remove property to obstruct decree; not to convert unsecured debt to secured or coerce settlement. (!) (!)
- Guidelines for attachment include: must prove circumstances; affidavits not vague; particulars of disposal needed; intent to defeat claim from conduct/surrounding facts; financial embarrassment relevant but insufficient alone. (!) (!) (!) (!) (!) (!) (!) (!) (!) (!) (!) (!) (!) (!) (!)
- Plaintiff established prima facie case: substantial debt, defendant's only property at risk, hectic alienation attempts reported via third-party affidavits, no pre-suit notice due to urgency, defendant failed to furnish security or show cause timely. (!) [2000479230007][2000479230008]
- Defendant did not claim other assets or solvency; no motive shown for false suit by plaintiff.[2000479230007][2000479230008]
- Provisions of Order XXXVIII CPC on attachment before judgment are self-contained with detailed procedure; power must be exercised only as prescribed, no other manner.[2000479230011][2000479230012]
- Acceptance of defendant's undertaking (without security) instead of attachment contravenes Order XXXVIII Rule 5 procedure; undertaking not contemplated therein. (!) (!) [2000479230009][2000479230012]
- Attachment before judgment voids private transfers post-attachment (Section 64 CPC), providing stronger protection than undertaking, which does not invalidate alienations (unlike lis pendens in injunction suits, inapplicable here as suit is for money decree). (!) (!) (!) (!) (!) (!) (!)
- In money recovery suit, attached property is not "suit property," so attachment uniquely prevents evasion via alienation. (!)
- Trial court erred in accepting undertaking and lifting attachment; not a fit case for such, as defendant failed to comply with interim directions. (!) [2000479230012]
- Revisions allowed: defendant's IA order set aside; plaintiff's IA remanded for fresh opportunity to defendant to furnish security within time fixed by trial court, failing which attachment before judgment; interim attachment continues till disposal.[2000479230013]
ORDER :
1. The CRP.no.4978 of 2015, under Article 227 of the Constitution of India, is filed by the petitioner/plaintiff assailing the order dated 01.09.2015 of the learned IX Additional District Judge, Chittoor passed in IA.no.17 of 2014 in OS.no.29 of 2014 filed under Order XXXVIII Rule 5 of the Code of Civil Procedure, 1908 (the Code, for brevity) requesting to order attachment before judgment of the petition schedule property.
1.1. The CRP.no.4915 of 2015, under Article 227 of the Constitution of India, is also filed by the plaintiff assailing the order dated 01.09.2015 passed in IA.no.19 of 2014 in IA.no.17 of 2014 in the aforementioned suit filed by the defendant under Order XXXVIII Rule 5 read with Section 151 of the Code requesting the Court to accept the undertaking given by him in the above mentioned application filed for attachment before judgment and not to order attachment of the petition schedule property.
2. I have heard the submissions of the learned counsel for the revision petitioner/plaintiff (the plaintiff, for brevity) and the learned counsel for the respondent/defendant (the defendant, for brevity). I have perused the material record.
3. The facts, which are neces
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