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IN THE HIGH COURT OF MADHYA PRADESH, JABALPUR
Vandana Kasrekar, J.
Ashok Lalwani - Appellant
Vs.
State Bank of India - Respondents
M.P. No. 1873 of 2017
Decided On : 09-08-2018
Order 41 Rule 5 - Stay of Execution - C.P.C - [Order 41 Rule 5] - The judgment discusses the provisions of Order 41 Rule 5 of the C.P.C, emphasizing the conditions for staying the execution of a decree, the requirement of furnishing security, and the discretion of the Appellate Court in directing either the furnishing of security or the depositing of the decree amount.
Fact of the Case:
The petitioner filed a suit for eviction and mense profit, which was decreed by the trial Court. The respondent, a Bank, filed an appeal challenging the decree for mense profit and sought a stay of execution under Order 41 Rule 5 of the C.P.C. The First Appellate Court granted an ex-parte order staying the execution of the judgment and decree. The petitioner filed an application for vacating the stay, arguing that the respondent had not deposited any amount or furnished the required security.
Finding of the Court:
The Court found that the First Appellate Court erred in granting the stay without the respondent depositing the required amount or furnishing security as per the provisions of Order 41 Rule 5 of the C.P.C. The Court also emphasized the requirement of special circumstances for staying a money decree and the discretion of the Appellate Court in directing the furnishing of security or the depositing of the decree amount.
Issues: The issues revolved around the grant of stay of execution under Order 41 Rule 5 of the C.P.C, the requirement of furnishing security, and the discretion of the Appellate Court in directing the furnishing of security or the depositing of the decree amount.
Ratio Decidendi: The Court held that the Appellate Court should not stay the execution of a money decree without the applicant furnishing the security for the due performance of the decree, and that special circumstances are required for staying a money decree. The Court also emphasized the discretion of the Appellate Court in directing either the furnishing of security or the depositing of the decree amount.
Final Decision: The miscellaneous petition was allowed, setting aside the impugned order and permitting the petitioner/decree holder to withdraw the amount deposited by the respondent, subject to furnishing the surety before withdrawal.
Key Points: - An Appellate Court should not stay the execution of a money decree unless the applicant furnishes security for the due performance of the decree (!) (!) . - Special circumstances are required for staying a money decree (!) (!) (!) . - The Appellate Court has discretion to direct either the furnishing of security or the depositing of the decree amount (!) (!) .
ORDER :
The petitioner has filed the present petition, under Article 227 of the Constitution of India, challenging the order dated 15.05.2017 passed by First Appellate Court thereby dismissing the application preferred by the petitioner for vacating the ex-parte order.
2. Brief facts of the case are that the petitioner preferred a suit for eviction and mense profit which was decreed by the trial Court. Against the said judgment and decree, the respondent after vacating the suit premises has preferred an appeal to challenge the decree for mense profit. Along with the said appeal, the respondent has filed an application under Order 41 Rule 5 of the C.P.C. The First Appellate Court allowed the said application. The petitioner has challenge the said ex-parte order by filing a writ petition No. 2029/2017, but the same was withdrawn to pursue the application for vacating the order of stay of execution. The First Appellate Court has dismissed the said application for vacating the stay order passed under Order 41 Rule 5 of the C.P.C vide order dated 15.05.2017 on the ground that the Bank has given an undertaking to comply with the decree in the event of dismissal of their appeal. Being aggrieved by that order, the petitioner has filed the present petition.
3. Learned counsel appearing on behalf of the petitioner argues that the order passed by the Appellate Court is in contravention of the provisions of Order 41 Rule 5 of the C.P.C. The First Appellate Court has further failed to see that a money decree cannot be stayed unless some amount is deposited by the respondent. He further submits that the respondent/Bank has no scarcity of funds whereas, the petitioner will suffer irreparable loss if the decreetal amount has not been deposited by the respondent/Bank. He further relied on the judgment passed by the Nagpur High Court in the case of Anandi Prashad Vs. Govinda Bapu, reported in AIR 1934 Nagpur 160 as well as the judgment passed by the Andhra High Court in the case of Pamulapati Varadayya Vs. Kommareddi Chinnappareddi and another, reported in AIR 1956 Andhra 64.
4. On the other hand learned counsel for the respondent supports the order passed by the trial Court and submits that the trial Court has not committed any error in dismissing the application preferred by the respondent for vacating the stay. He further relied on the judgment passed by the Apex Court in the case of M/s Mehta Teja Singh and Company Vs. Grindlays Bank Limited, reported in (1982) 3 SCC 199.
5. Heard learned counsel for the parties the perused the record.
6. The Order 41 of the C.P.C. provides for the appeals from original decrees and Rule 5 deals with the stay by appellate Court. Sub Rule 3, 4 & 5 of Rule 5 reads as under:-
“Order 41 Rule 5-(3) No order for stay of execution shall be made under sub-rule (1) or sub-rule (2) unless the Court making it is satisfied-
(a) that substantial loss may result to the party applying for stay of execution unless the order is made;
(b) that the application has been made without unreasonable delay; and
(c) that security has been given by the applicant for the due performance of such decree or order as may ultimately be binding upon him.
(4) [Subject to the provisions of sub-rule (3)], the Court may make an ex parte order for stay of execution pending the hearing of the application.
(5) Notwithstanding anything contained in the foregoing sub-rules, where the appellant fails to make the deposit or furnish the security specified in sub-rule (3) of rule 1, the Court shall not make an order staying the execution of the decree.]”
As per the Sub Rule 3 of Rule 5, the appellate Court shall not stay the judgment and decree passed by the Lower Court unless applicant has furnished the security for the due performance of such decree or order as may ultimately be binding upon him.
7. Sub Rule 5 of Rule 5 submits that if the appellant fails to make the deposit or furnish the security as specified in sub-rule (3) of Rule 1, the Court shall not make an
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