1996 Supreme(Del) 342
High Court Of Delhi
BELHOUSE ASSOCIATES PRIVATE LIMITED - Appellant
Versus
B M L MITTAL - Respondent
Decided On : 04/12/1996
The court held that an order under Order 38 Rule 5 Civil Procedure Code should not be passed, unless the court is satisfied that the defendant, with intent to obstruct or delay the execution of decree that may be passed against him, has brought himself within the terms of the rule, and it is not sufficient that there are merely vague allegations that the defendant is about to remove the whole or any part of his property from the local limits of the jurisdiction of the court.
Headnote:
ATTACHMENT BEFORE JUDGMENT - ORDER 38 RULE 5 CIVIL PROCEDURE CODE - REQUIREMENTS - SATISFACTION OF THE COURT - MATERIAL ON RECORD - INTENTION TO OBSTRUCT OR DELAY EXECUTION OF DECREE - ESSENTIAL REQUIREMENTS - SUFFICIENCY OF GROUNDS - INTERPRETATION OF ORDER 38 RULE 5 CIVIL PROCEDURE CODE.
Fact of the Case:
The respondent-plaintiff filed a suit for recovery of Rs. 1,24,000.00 and along with the plaint, he also filed an application under Order 38 Rule 5 read with Order 39 Rule 1 and 2 Civil Procedure Code for attachment before judgment of amounts due to the defendant and lying with the Chief Engineer Hydro Electric Project, Tankpur, District, Nainital (U.P.). The defendant-appellant contested the application and the learned Trial Court directed the defendant to furnish security for due performance of the decree likely to be passed and if the security was not furnished the amounts lying with the Chief Engineer at Tanakpur will remained attached under Order 38 Rule 5 Civil Procedure Code.
Finding of the Court:
The court held that the impugned order cannot be sustained and it requires quashing in the appellate jurisdiction. The parties are, however, left to bear their own costs in the present appeal.
Issues: Whether the Trial Court was justified in ordering attachment before judgment under Order 38 Rule 5 Civil Procedure Code.
Ratio Decidendi: The court held that the affidavit filed by the plaintiff does not meet the mandatory requirements of Order 38 Rule 5 Civil Procedure Code. There is hardly any material worth the name to establish that the defendant was about to dispose of the whole or part of his property from the local limits of jurisdiction of the Trial Court with intent to obstruct or delay the execution of am decree that may be passed against him. The court further held that the requisite satisfaction has not been expressed in the impugned order. Bare allegations, as stated above, would not suffice the purpose.
Final Decision: The appeal is allowed and the impugned order dated 5-5-1994 is set aside. The parties are, however, left to bear their own costs in the present appeal. Parties are directed to appear before the lower court on 30-4-1996.
( 1 ) THE appeal lie in a short compass. The respondent-plaintiff filed the present suit for recovery of Rs. 1,24,000. 00 and along with the plaint, he also filed an application under Order 3 8 Rule 5 read with order 39 Rule 1 and 2 Civil Procedure Code for attachment before judgment of amounts due to the defendant and lying with the Chief Engineer Hydro Electric Project, Tankpur, District, Nainital (U. P. ). The defendant- appellant contested that application and inspite of such contest, the learned Trial Court directed the defendant to furnish security for due performance of decree likely to be passed and if the security was not furnished the amounts lying with the Chief Engineer at Tanakpur will remained attached under Order 38 Rule 5 Civil Procedure Code. This appeal is directed against the said order.
( 2 ) LEARNED counsel for the appellant contended that apart from the allegations that the defendant is winding up his work at Tanakpur site and is trying to dispose of the property and the machinery and is also trying to collect payment due from the Chief Engineer, Tanakpur with a view to defeat the plaintiffs claim, no attempt was made to substantiate before the Trial Court these allegations, and the learned Trial Court has not even adverted to the question as to whether these allegations require acceptance and hence the impugned order cannot be sustained.
( 3 ) A large measure of case law has grown around Order 38 Rule 5 Civil Procedure Code, its highlight being that the remedy under Order 38 Rule 5 Civil Procedure Code is an extraordinary remedy and the said provisions cannot be used as a lever for the plaintiff to coerce the defendant to come to terms. The court has, therefore, to act with utmost circumspection and with maximum care and caution before issuing an order under Order 38 Rule 5 Civil Procedure Code. Learned counsel for the petitioner placed before me Hari Shankar Vs. Smt Bhoori Devi 1975 (Vol. XI) D. L. T. 159. It is laid down in the said case as:
"it goes without saying that the jurisdiction of courts in attaching property before judgment is of an extraordinary nature and has to be exercised sparingly and strictly in accordance with the procedure prescribed by the Code. The court has to be satisfied on two points, namely (1) that the defendant is about to dispose of the whole or part of his property (emphasis added) and (2) that the disposal is with the intention of obstructing or delaying the execution of any decree that may be passed against him. There has to be definite evidence on these points and not merely vague allegations. An order of the court without proper investigation of the allegations constitute a grave dereliction of duty. The fact that the defendant is in uncertain circumstances and is in acute financial and embarrassment is a relevant circumstance but is not by itself sufficient. Again the fact that the plaintiff may have cope just claim against the defendant will not entitled him in law to have an order of attachment before judgment. At the same time before exercising jurisidiction under rule 5, the Court should satisfy itself of the practical certainty of the plaintiffs success and of the existence of a grave danger and of a real fear that a dishonest defendant, undoubtedly liable, is making away with the probable fruits of the judgment and for this purpose it is not sufficient to merely allege that defendant is likely to dispose of the property"
( 4 ) SIMILAR is the principle laid down in Bank of India Vs. M/s N. T. Work Industries, AIR 1989, Delhi 60. It lays down that an order under Order 38 Rule 5 Civil Procedure Code should not be passed, unless the court is satisfied that the defendant, with intent to obstruct or delay the execution of decree that may be passed against him, has brought himself within the terms of the rule, and it is not sufficient that there are merely vague allegations that the defendant is about to remove the whole or any part of his property from