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2020 Supreme(UK) 504
IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL
Lok Pal Singh, J.
Shalini Agarwal and Ors. - Appellants
Vs.
Sri Shandar Industries Private Ltd. - Respondent
Civil Revision Nos. 157 and 159 of 2019
Decided On : 08-12-2020
For the Appellant :Siddhartha Singh, Advocate
For the Respondents:Sudhir Kumar, Advocate
The plaintiff must establish a strong prima facie case of success to invoke the provisions of Order XXXVIII Rule 5 of CPC. Subsequent applications are barred by principles of res judicata, and the trial court must refrain from allowing such applications without a strong prima facie case.
Headnote:
Attachment Before Judgment - Civil Procedure Code - Order XXXVIII Rule 5 - Summary: The court allowed the applications moved under Order XXXVIII Rule 5 of CPC, directing the defendants to furnish security equivalent to the value of the suits. The subsequent applications were found to be barred by principles of res judicata. The court held that the plaintiff failed to establish a strong prima facie case of success, and the trial court committed gross illegality in allowing the applications. The impugned orders and consequential orders were quashed, and the trial court was directed to expedite the suit.
Fact of the Case:
Two suits were filed by the plaintiff against the defendants seeking recovery of money for the purchase of land. The plaintiff alleged an oral agreement with the defendants, who denied it and claimed a memorandum of understanding was signed. The plaintiff moved applications under Order XXXVIII Rule 5 of CPC, which were allowed by the trial court, leading to the attachment of the defendants' property.
Finding of the Court:
The court found that the subsequent applications were barred by principles of res judicata and that the plaintiff failed to establish a strong prima facie case of success. The trial court's decision to allow the applications was deemed to be a gross illegality, and the impugned orders and consequential orders were quashed.
Issues: The issues revolved around the validity of the applications moved under Order XXXVIII Rule 5 of CPC, the establishment of a strong prima facie case by the plaintiff, and the application of the principles of res judicata.
Ratio Decidendi: The court held that the plaintiff must establish a strong prima facie case of success to invoke the provisions of Order XXXVIII Rule 5 of CPC. The subsequent applications were found to be barred by principles of res judicata, and the trial court's decision to allow the applications was deemed to be a gross illegality.
Final Decision: The court allowed the civil revisions, quashed the impugned orders and consequential orders, and directed the trial court to expedite the suit.
JUDGMENT :
Lok Pal Singh, J.
1. Since common question of facts and law are involved in these revisions, therefore, both the revisions are being decided by a common judgment and order.
2. Civil Revision No. 157 of 2019 has been preferred against the order dated 07.11.2019 passed by Civil Judge (S.D.), Kashipur, District Udham Singh Nagar, in civil suit no. 19 of 2018 whereas Civil Revision No. 159 of 2019 has been filed against the order dated 07.11.2019 passed in civil suit no. 18 of 2018. By the orders impugned, the applications moved by the respondent/plaintiff under Order XXXVIII Rule 5 of Civil Procedure Code, 1908 (hereinafter to be referred as the CPC) have been allowed and the revisionists/defendants have been directed to furnish security equivalent to the value of suit claim.
3. Factual matrix of the case is that two suits being numbered as O.S. No. 18 of 2018 and O.S. No. 19 of 2019 were preferred by the respondent/plaintiff in the court of Civil Judge (S.D.) Kashipur, District Udham Singh Nagar against the defendant/revisionist, seeking similar relief of recovery of money in both the suits, inter-alia on the ground, that the plaintiff is a registered company. The plaintiff company wanted to purchase land nearby its unit. Defendant Smt. Shalini Agarwal in O.S. No. 18 of 2019 and defendant Km. Seema Chauhan in O.S. No. 19 of 2019 were having lands khasra no. 207 admeasuring 1.936 hectare and khasra no. 208 admeasuring 0.608 hectare in Village Nadehi respectively. In the west side of the lands, as there was Chak road, the plaintiff showed its interest to purchase the lands from the defendants and Rs.1,35,00,000/- was fixed for khasra no. 207 and Rs.63,00,000/- for khasra no. 208. The defendants assured to open the chak road and thereafter to enter into an agreement with the plaintiff, in accordance with law. On the assurance given by the defendants for their respective piece of land, the plaintiff paid Rs.20,00,000/- vide cheque no. 327060 on 25.01.2016 and Rs.42,00,000/- through RTGS on 29.04.2016 to the defendant Smt. Shalini Agarwal, and to the defendant Km. Seema Chauhan, he paid Rs.5,00,000/- vide cheque no. 327061 dated 25.01.2016 and Rs.8,00,000/- though R.T.G.S. However, subsequently the defendants expressed their inability to resolve the dispute of opening the chak road. As they could not fulfill their part of contract, the plaintiff requested to return the earnest money but the defendants did not return the same. As such, the plaintiff sent a registered notice to the defendants through counsel which was duly served upon the defendants. Inspite of the notice, when the defendants did not return the money to the plaintiff, the plaintiff constrained to file the suits.
4. The revisionists/defendants contested the suits and filed their written statements in the suits stating that the plaintiff wanted to purchase land khasra no. 208 admeasuring 1.986 hectare from the defendant Smt. Shalini Agarwal and land khasra no. 207 admeasuring 0.608 from defendant Km. Seema Chauhan. In the written statements, the defendants denied any oral agreement between the parties. However, they stated that a memorandum of understanding (hereinafter to be referred as 'MOU') dated 24.01.2016 was entered into between the parties, which was signed by the plaintiff's manager and the plaintiff has accepted the terms of said MOU. It was further stated that the plaintiff has failed to purchase the land as per the MOU and thus the amount has been forfeited.
5. During the pendency of the suits, plaintiff moved applications under Order XXXVIII Rule 1 of CPC in both the suits stating therein that the plaintiff has come to know that the defendants are trying to dispose off all their properties and intent to go out of the jurisdiction of the court, and if the defendants succeeded in their attempt, then the recovery would be impossible. Hence, the plaintiff prayed that the defendants' property, as mentioned in the applications, be attached. The defendants fil
