Prohibitory order passed in application for garnishee order confirmed in appeal.

S. Jagadeesan,J.

1. The appeal has been filed by the appellants against the order of the learned Judge dated 1.3.2002 in Application No.334 of 2002, directing the garnishee, the second respondent herein, to retain a sum of Rs. 1,18,31,000/-until further direction.

2. The admitted facts are:- The first respondent herein advanced money on hire purchase agreement to the first appellant herein. The second appellant is the guarantor. As per the terms of the hire purchase agreement, the parties have to go for arbitration, if any dispute arises between them. The application 334 of 2002 was filed by the first respondent, seeking a garnishee order on the ground that the first respondent do not want to exercise their right to repossess the machineries hired to the first appellant, since the value of the machineries will be considerably reduced by such repossession. As the appellants failed to discharge their obligation of repayment of the loan amount as per the schedule and the arrears had accrued, the first respondent sought the relief by way of garnishee order to protect their interest.

3. Thesaid application was contested by the appellants.

4. The learned Judge, after considering the arguments advanced on behalf of the parties, passed the prohibitory order, which is being challenged in this appeal.

5. Mr. Habibullah Badsha, the learned senior counsel appearing on behalf of the appellants vehemently contended that the affidavit filed in support of the application seeking the garnishee order do not contain the requisite averments in compliance of Order 38, Rule 5, C.P.C. and the learned Judge also failed to consider the same. When an order of attachment or a prohibitory order is sought for against the respondents, it is the duty of the applicant to satisfy the requirement of the provision of Order 38 Rule 5, C.P.C. by making such averments. If the affidavit do not contain any averments in due compliance of the said provision, the court is not empowered to pass any interim order as prayed for. The affidavit filed by the first respondent in support of the application seeking the prohibitory order do not contain any of the averments as required under Order 38, Rule 5, C.P.C. and as such the order of the learned Judge cannot be sustained. The learned senior counsel also referred to number of judgments in support of his contention.

6. In view of the only question argued before us, it is unnecessary for us to deal with the facts elaborately.

7. The question for consideration is whether the application seeking the prohibitory order under the Arbitration Act, 1996, restraining the garnishee from making any payment, should contain the averments as contemplated under Order 38, Rule 5, C.P.C.

8. The hire purchase transaction between the parties is not disputed. The default committed by the first appellant in repayment of the loan is also not disputed. Even though the default has not been disputed, but still the learned senior counsel for the appellants contended that the quantum of the amount claimed is under dispute and as such when the quantum itself is under dispute, no garnishee order can be passed. In this aspect, the learned Judge has made a reference in paragraph 19 of the order, wherein it is stated as follows:

"On the facts of the case, the default is not in dispute. The applicant claims a substantial sum as due and except making half hearted denial the liability is not being challenged."

9. When admittedly some liability is there, we also suggested to the learned senior counsel to ascertain as to how much amount is due under the hire purchase agreement. The learned senior counsel replied stating that no amount is due and in fact there was over payment. In support of such contention, no material is available before the court, as the appellants totally failed to produce any statement of account with regard to their payment of instalments as scheduled under the hire purchase agreement and their claim of excess payment. In s