1981 Supreme(Kar) 277
Karnataka High Court
STATE BANK OF HYDERABAD - Appellant
Versus
DHANALAKSHMI TRADING CO - Respondent
Decided On : 09-04-81
C.R.P. : 1434 of 1981
B.S.RAIKOTE, K.P.KUMAR
The court emphasized the need for utmost circumspection and care before issuing an order of attachment before judgment, highlighting that the property sought to be attached must be definite and certain, and a mere inchoate claim cannot be the subject of attachment unless it results in an enforceable award, order, or decree.
Headnote:
Attachment before Judgment - Civil Procedure - Order 38 Rule 5, Order 21 Rule 46 - The court discussed the requirements of Rule 5 of Order 38 of the Code of Civil Procedure (CPC) and the necessity for attachment before judgment. It highlighted the need for utmost circumspection and care before issuing an order of attachment, emphasizing that it should not be used as a coercive instrument. The court also emphasized that the property sought to be attached must be definite and certain, and a mere inchoate claim cannot be the subject of attachment unless it results in an enforceable award, order, or decree.
Fact of the Case:
The State Bank of Hyderabad filed two suits for recovery of outstanding amounts against the defendants. The bank sought an order of attachment before judgment of the claim amount payable by the United India General Insurance Co. The trial court rejected the applications for attachment before judgment.
Finding of the Court:
The court found that the affidavits filed in support of the applications did not establish a prima facie case for passing an order for attachment before judgment. It emphasized the need for utmost circumspection and care before issuing an order of attachment, and highlighted that the property sought to be attached must be definite and certain.
Issues: The main issue was whether the trial court was justified in rejecting the applications for attachment before judgment filed by the petitioner.
Ratio Decidendi: The court held that the remedy of attachment before judgment is an extraordinary remedy and should be exercised with utmost care. It emphasized that the property sought to be attached must be definite and certain, and a mere inchoate claim cannot be the subject of attachment unless it results in an enforceable award, order, or decree.
Final Decision: The civil revision petitions were dismissed, and the court made it clear that the order would not prevent the petitioner from making an appropriate application for relief.
( 1 ) THESE tvo civil revision petitions arise out of the two suits being C. S, nos. 33 and 36 of 1981 respectively on the file of the learned Civil Judge. Yadagiri, and are preferred agains: a common order passed by the learned civil Judge on I. A. 2 filed in each, one cf the suits in question. I. A. 2 was filed by the petitioner under Order 38 rule 5 read with Section 151 of the cpc for an order of attachment before judgment of the claim amount payable by the United india General Insurance Co. Madras, branch at Raichur to M/s. Dhanalakshmi Trading Co. (defendant-1) in a sum of Rs. 8 lakhs in connection v/ith the fire accident at Raichur agriculture Produce Marketing and processing Centre, Cotton Kapas raichur.
( 2 ) BOTH the suits have been filed by the Stale Bank of Hyderabad, which is the petitioner in both these revision petitions. The prayer made in the application (I. A. 2) filed in both the suits is the same and the allegations made in the affidavits filed in support of the applications are also similar the trial Court, on consideration of. "he averments made in the affidavits filed in support of the applications, has held that no cose is made out for passing an order for attachment" before judgment and has accordingly rejected the applications.
( 3 ) IT is contended, by Shri Shah, learned Counsel on behalf of Mis. King and Partridge for the petitioner in bath the civil revision petitions, that the petitionerr has gon a very heavy claim against the respondents who are indebted to a large extent; that if an order for attachment before judgment is not passed, the petitioner will not be able to reap the fruits of the decree which it may secure in the suits in question. It is also further concended that the debts incurred by the respondents are disproportionate to their assets.
( 4 ) WHEREAS, on behalf of the respondents it is contended that 'the allegations made in the affidavits filed in support of the applications (LA. 2) do not at' all make out a case for passing an order for attachment before judgment; that the requirements of Rule 5 of Order 38 of C. P. C. have not been prima facie established; that an order of attachment before judgment will have serious consequences and will adversely affeet ihe business and reputation of the respondents; therefore, in be absenco of any prima facie case tailing under Rule 5 of Order 38 of the c. P. C. (shortly, 'the Code') having been made out by the petitioner, the trial Court is justified in refusing to pass an order for attachment before judgment. It is also further submitted that the respondents who are the defendants in the suits in question, have denied the suit claims as made by the petitioner-plaintiff. Therefore the question that arises for consideration is as to whether the trial Court is justified in rejecting the applications filed be the petitioner for attachment before judgment.
( 5 ) THE averments made in the affidavit filed in support of the application under Rule 5 of Order 38 of the Code, are as follows:" I. N. K. Desai S/o. Krishna Rao, aged 38 years, Branch Manager of the plaintiff Bank residing at Yadgiri, district Gulbarga hereby state on boath. as follows:- i am the Manager of the plaintiff-Bank and acquainted of. all the facts of 'be case. , the plaintiff has filed a suit against the defendants for recovery of a sum of. Rs. 41,409. 70 including costs and interest being the outstandings in the bill discount facility availed by the defendant No. 1. The averments in the plaint may be read as part of this petition. The petitioner-plaintiff bank learns that in respect of a fire accident occurred on 23rd Oct. 1980 at Raichur in the premises of Raichur agriculture Produce Marketing and processing Centre, Cotton Kapas and fully pressed cotton bales belonging to the first defendant which were insured with United India general Insurance Co. , Madras Branch, Raich in were burnt. The 1st defendant Mjs. Dhanalaxmi Trading Co. , had preferred a claim with t