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2025 Supreme(Mad) 5318

IN THE HIGH COURT OF JUDICATURE AT MADRAS
R. SAKTHIVEL, J.
 R. Magesh – Petitioner 
Versus
M/s. Vel and Co., Represented by its Partners, C.K. Velu and J. Gajendran – Respondent
CRP NO.2709 OF 2022 AND CMP NO.14101 OF 2022
Decided On : 09-12-2025
 

Advocates Appeared:
For the Petitioner: Mr. G. Jeremiah

The court emphasizes the necessity of establishing a prima facie case for property attachment in recovery suits, while also scrutinizing the basis for previous decisions regarding property values.

Headnote:(A) Code of Civil Procedure, 1908 - Order XXXVIII Rule 5 - Interlocutory Application - Suit for recovery of money and attachment of properties - The plaintiff’s request to attach properties in the hands of defendants was dismissed by the Trial Court; however, the appellate court allowed attachment of certain properties, questioning the basis of the Trial Court's findings regarding property value and continuing the attachment on others. (Paras 1-19)

(B) Attachment of properties - Legal principles regarding interim attachment and prima facie case established - The plaintiff must demonstrate a prima facie case to justify attachment, particularly in cases involving property transfers intended to evade obligations. (Paras 1-19)

(C) Dismissal of attachment - Court found insufficient evidence to support the attachment of a specific property owned by a defendant, ruling that the plaintiff failed to establish a prima facie case for that attachment. (Paras 1-19)

Facts of the case:
The plaintiff, dealing with defendants who collectively owed a sum of Rs.1,50,50,000/-, alleges fraudulent transfer of properties by the defendants to avoid payment. (Paras 3-5)

Findings of Court:
The court ordered attachment of multiple properties to secure the plaintiff's claim but denied attachment on one property due to lack of evidence. (Para 19)

Issues: Whether the plaintiff established a prima facie case to warrant attachment of the properties and if the Trial Court erred in its dismissal of an earlier application for attachment. (Paras 4, 18)

Ratio Decidendi: The appellate court clarified that the existence of a prima facie case is necessary for granting attachment and evaluated the merits of the Trial Court’s decision regarding property values. (Paras 19, 19.1)

Result: Civil Revision Petition allowed in-part; properties B, C, and E ordered to be attached, while attachment of D was dismissed.

Table of Content
1. overview of the case and factual background of claims. (Para 1 , 2 , 3 , 4 , 5 , 6)
2. court's decision on the interlocutory application and related orders. (Para 9 , 10 , 19)
3. arguments presented by the defendants regarding claims and counterclaims. (Para 11 , 13 , 14)
4. court analysis of prima facie case and property attachments. (Para 12 , 16 , 17 , 18)

ORDER :

R. SAKTHIVEL, J.

1. Feeling aggrieved by the dismissal Order passed in the Interlocutory Application filed under Order XXXVIII Rule 5 of the Code of Civil Procedure, 1908 in I.A.No.1 of 2019 in O.S.No.82 of 2019 by the 'II Additional District Court, Ranipet, Vellore District' (hereinafter referred to as the 'Trial Court'), the petitioner therein has filed this Civil Revision Petition.

2. The revision petitioner herein is the plaintiff and the respondents herein are the defendants in the Original Suit. For the sake of convenience and clarity, the parties will from now on be referred to in this Order as per their array in the Original Suit.

3. The plaintiff filed the Original Suit in O.S.No.82 of 2019 seeking money decree for a sum of Rs.1,91,03,497/- together with subsequent interest at 24% per annum on the principal sum of Rs.1,50,50,000/-. Case of the plaintiff is that the first defendant is a partnership firm and the defendants 2 and 3 are its partners. The plaintiff is a dealer of Indian Oil Corporation and is carrying on business under the name and style of GPR Agency as its sole proprietor. At the request of the defendants 2 and 3 - partners, plaintiff supplied diesel on credit as and when required by first defendant - partnership firm. As on March 31, 2018, there was an outstanding payment of Rs.38,81,368.61/-. At the request of defendants 2 and 3, plaintiff continued to supply diesel on credit despite the pending payment. About 6 months thereafter, the outstanding amount was reconciled at Rs.1,50,42,787.51/-. Due to the considerable delay in payment, the defendants 2 and 3 agreed to settle the plaintiff with Rs.1,50,50,000/- and they both issued a cheque on behalf of the first defendant - partnership firm in favour of plaintiff on September 10, 2018 for the said amount. However, when the cheque was presented on September 11, 2018, it got returned as 'account closed'. According to the plaintiff, defendants 1 to 3, who are jointly and severally liable for the payment of the aforesaid amount, purchased / transferred several immovable properties in the name of defendants 4 to 6, who are their family members, with an ulterior motive to defeat the Suit claim. Hence, he filed the Suit on October 25, 2019.

4. Along with the Suit, the plaintiff filed an Interlocutory Application in I.A.No.1 of 2019 seeking an Order for attachment of A to E schedule of properties mentioned in the petition before Judgment. In the Interlocutory Application, the plaintiff averred that 'A' and 'B' schedule properties stand in the name of first defendant, 'C' schedule property stands in the name of second defendant, 'D' schedule property stands in the name of fifth defendant and 'E' schedule property stand in the name of sixth defendant.

5. In the said Interlocutory Application, the Trial Court directed the defendants to furnish security on or before November 27, 2019. After receiving notice, defendants 2 to 6 appeared through their Advocate, however, they did not furnish security as per the Order of the Court. According to the plaintiff, while so, the Trial Court ought to have ordered for attachment, instead, the Trial Court just posted the matter for filing counter. Hence, feeling aggrieved, the plaintiff filed Civil Revision Petition in CRP (PD) No.4089 of 2019 wherein this Court ordered for an interim attachment in C.M.P.No.26776 of 2019 over the petition mentioned B, C, D and E schedule properties. Eventually, on February 6, 2020, the Civil Revision Petition was disposed of, by directing the Trial Court to dispose of I.A.No.1 of 2019 on merits until which the interim attac

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