Karnataka High Court
Judges : G.C.Bharuka,K.Sreedhar Rao
UNITED BREWERIES LTD. - Appellant
Versus
KARNATAKA BANK LTD. - Respondent
R. F. A. 105 Of 2000
Decided On : 03/16/2000
Advocates Appeared :
Y.V.Parthasarathy
Garnishee - Liability Restriction - Order 21, Rule 46
Fact of the Case:
The decree holder obtained a decree against the judgment debtors and sought a prohibitory order against the garnishee for a specific amount. Subsequently, the decree holder applied for the garnishee to deposit accrued interest liability. The trial court directed the garnishee to deposit the accrued interest amount, which was contested by the garnishee.
Finding of the Court:
The court found that the liability of the garnishee is restricted to the amount mentioned in the prohibitory order and notices issued under Order 21, Rule 46 of the Civil Procedure Code. It held that compelling the garnishee to pay the entire balance decretal liability based on the earlier prohibitory order was unjustified.
Issues: The key issues were whether the liability of the garnishee extends to the entire liability of the judgment debtor or is restricted to the amount mentioned in the prohibitory order and notices issued under Order 21, Rule 46 of the Civil Procedure Code.
Ratio Decidendi: The liability of the garnishee is restricted to the amount mentioned in the prohibitory order issued under Order 21, Rule 46. Any further sum available with the garnishee requires a fresh proceeding to be instituted under Order 21, Rule 46.
Final Decision: The appeal was allowed, and the order of the trial court was set aside.
( 2 ) THE material facts relating to the case are stated thus: The first respondent decree holder obtained a decree against the judgment debtors in O. S. No. 1759 of 1988 by virtue of the compromise entered into between the parties. An application came to be made under Order 21, rule 46 for issuance of prohibitory order against the garnishee, the revision petitioner, for a sum of Rs. 5,66,365. 66, pursuant to which the garnishee deposited the amount in the court after contest. Subsequently, the decree holder made an application for directing the garnishee to deposit the accrued interest liability payable under decree in a sum of Rs. 13,70,555. 70. The trial court after hearing the objections, directed the garnishee to deposit the amount of Rs. 13,70,551. 70. Being aggrieved, the garnishee filed the appeal.
( 3 ) THE short questions that arise in the appeal are : (1) whether the liability of the garnishee extends to the entire liability of the judgment debtor or (2) whether it is restricted to the amount mentioned in the prohibitory order and the notices issued under Order 21, Rule 46 of the Civil procedure Code.
( 4 ) THE provisions under Order 21, Rule 46 of the Civil Procedure Code provide for attachment of money and other movables belonging to the judgment debtor, in the possession of the garnishee by issuance of notice, to the garnishee in the format provided in Appendix "e" in Form No. 17 as under: form No. 17 attachment in execution prohibitory order. Where the property consists of debts, not secured by negotiable instruments. (Order 21, Rule 46) (Title) to whereas. . . . . . . . has failed to satisfy a decree passed against. . . . . . . . . . on the. . . . . . . . . . day of. . . . . . . . . . 19. . . . . . . . in suit No. . . . . . . . . . . of 19. . . . . . . . . . It is ordered that the defendants be, and is hereby, prohibited and restrained until the further order of this court, from receiving from you a certain debt alleged now to be due from you to the said defendant, namely. . . . . . . . . . and that you, the said. . . . . . . . . . be and you are hereby, prohibited and restrained from making payment of the said debt, or any part thereof, to any person whomsoever or otherwise than into this court. Given under my hand and the seal of the court this day of. . . . . . . . 19. . . . . . . . . . . Judge
( 5 ) WHEREUNDER for a specified amount, a prohibitory order is issued to the garnishee, restraining him from making payment of the said amount or debt to the judgment debtor. If the garnishee disputes the liability, he has a right to be heard in the matter if the court affirms the liability of the garnishee under Rule 46 (f) and the payment made by the garnishee, on the notice issued under Rule 46 (3) or Rule 46a (3), it would be a valid discharge.
( 6 ) HEREIN in the instant case, on perusal of the records in execution case, discloses prohibitory order was issued against the garnishee for a sum of Rs. 5,66,375. 60 only, which was disputed. The trial court after hearing both the parties ultimately, passed an order on July 31, 1995, directing the garnishee to deposit the said amount, pursuant to which, the amount has been deposited.
( 7 ) SUBSEQUENTLY, the present application came to be made for deposit of Rs. 13,70,551. 70 being accrued interest amount payable on the principal amount.
( 8 ) ON going through the impugned order and the records of the trial court, it discloses that initially when the proceedings were instituted against the garnishee under Order 21, Rule 46, prohibitory order was taken only in respect of Rs. 5,66,375. 60 only. Accordingly, the garnishee has paid the amount into the court. In respect of th
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