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Citation Codes
Equivalent Citations
citation codes
Case Number
Judges
Acts
  • Order 21, rule 58
  • 21, rule 52,
  • 21, rule 58
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Judges
Acts
  • Order 21, rule 58
  • 21, rule 52,
  • 21, rule 58
Smart Summary

Factual and Procedural Background

The appellant obtained a decree for Rs. 20,000 against the respondent in O.S. No. 16 of 1954 from the subordinate judge's court at Kavali. Execution of this decree led to attachment of Rs. 20,000, which the respondent deposited in the sub-court at Vijayawada credited to O.S. No. 203 of 1950. This deposit was made as part satisfaction of a compromise decree in that suit. The decree-holder refused to accept this partial deposit, contending it breached the compromise terms. Upon attachment under Order 21, Rule 52, the respondent objected, claiming the deposited money was not his property. The executing court overruled this objection, holding that Order 21, Rule 58 did not permit the judgment-debtor to resist attachment on ownership grounds. The respondent appealed to this court (C.M.A. No. 249 of 1961), but Justice Munikanniah dismissed the appeal, directing the amount to remain deposited until the decision of A.A.O. No. 259 of 1962. This direction is challenged in the present appeal.

Legal Issues Presented

  1. Whether the learned judge erred in directing that the attached amount remain deposited until the disposal of an appeal (A.A.O. No. 259 of 1962) between the respondent and a third party, to which the appellant was not a party.
  2. Whether a judgment-debtor can resist attachment of property on the ground that the property does not belong to him under Order 21, Rule 58.
  3. The applicability and scope of Order 21, Rule 58 in cases where ownership of attached property is disputed by the judgment-debtor.

Arguments of the Parties

Appellant's Arguments

  • The learned judge was not justified in staying payment of the attached money until the disposal of an appeal involving the respondent and a third party, in which the appellant was not a party.
  • The outcome of the third-party appeal should not affect the appellant’s rights under the present execution proceeding.
  • The appeal between the respondent and the third party ended in a compromise requiring the respondent to pay the full decretal amount (excluding the attached sum), hence the appellant’s rights should not depend on that appeal.

Respondent's Arguments

  • The respondent contended that the deposited amount was not his property and therefore could not be attached.
  • The respondent relied on Order 21, Rule 58 to resist attachment on the basis that the money belonged to a third party.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Order 21, Rule 52 Procedure for attachment of property in execution proceedings. Used to justify attachment of the deposited amount by the appellant.
Order 21, Rule 58 Procedure for investigation of claims to attached property by third parties. The court held that this rule does not empower the judgment-debtor to resist attachment by claiming the property is not his, especially when the alleged owner disclaims the property.
Lakshman Dadaji v. Damodar Ambadas, (1891) I.L.R. 15 Bom. 681 Attachment and ownership dispute over money deposited in court. The court distinguished this precedent, noting the facts were different and that the judgment-debtor in that case complied with a court order to deposit money, unlike the present case.
Khetramohan v. Sidha Kamal, A.I.R. 1956 Orissa 296 Support for the principle that a judgment-debtor cannot resist attachment by claiming the property belongs to another who disclaims it. The court relied on this case to support its view that the objection by the judgment-debtor was untenable.

Court's Reasoning and Analysis

The court analyzed the procedural and substantive aspects of the attachment and the objections raised. It found that the direction to keep the amount deposited until the disposal of an appeal involving a third party was improper because the appellant was not a party to that appeal, and its outcome should not affect the appellant's rights. The court emphasized that Order 21, Rule 58 contemplates investigation only when a claim is made by a person asserting a right or title to the attached property. Since the alleged owner disclaimed any claim, the judgment-debtor's objection on ownership grounds was not maintainable. The court distinguished the cited precedent (Lakshman Dadaji v. Damodar Ambadas) due to differing facts and procedural context. It further relied on the Orissa High Court's decision in Khetramohan v. Sidha Kamal to reinforce that a judgment-debtor cannot resist attachment by asserting ownership in favor of a third party who disclaims it. The court also noted that allowing the disputed direction would cause a stalemate, preventing either party from accessing the attached funds, which is impermissible.

Holding and Implications

The court ALLOWED the appeal, holding that the direction to keep the attached amount deposited until the disposal of the third-party appeal was contrary to law and could not stand. The objection by the judgment-debtor that the money was not his was rejected. The appellant was entitled to have the attached amount released without delay. The appellant was also awarded costs of the appeal. No new precedent was set beyond the application of existing principles regarding attachment and ownership objections under Order 21, Rule 58.

    Jai Prakash Talkies v. Lakshmi Talkies

    Chandra Reddy, C.J.:-

    (1) This, appeal is filed against the judgment of justice munikanniah in c. M. A. No. 249 of 1961, directing that the amount attached will remain in deposit till a. A. O. No. 259 of 1962 was finally decided.

    (2) The facts giving rise to this appeal are briefly these : the appellant obtained a decree against the respondent in o. S. No. 16 of 1954 on the file of the court of the subordinate judge, kavali, for a sum of rs. 20,000. He took out execution of this decree and attached a sum of rs. 20,000 which the respondent deposited in the sub - court, vijayawada, to the credit of o. S. No. 203 of 1950. The respondent made this deposit in part satisfaction of a compromise decree passed against him in the abovementioned suit. As this amount did not fully satisfy the decree, the decree - holder refused to take this amount contending that the deposit of a sum much smaller than that stipulated was in breach of the terms of'the compromise. When the attachment of this amount was made by the appellant under order 21, rule 52, the respondent - judgment - debtor raised an objection that the money in deposit could not form the subject of attachment as it was not his. This objection was overruled by the executing court in the view that Order 21, rule 58 did not enable the judgment - debtor to resist the attachment on the plea that he was not the owner thereof. In the result, the attachment was not vacated.

    (3) The aggrieved judgment - debtor carried an appeal to this court in c. M. A. No. 249 of 1961. Justice munikanniah while dismissing the appeal said that the attached amount will remain in court deposit till a. A. O. 'no. 259 of 1962 was finally decided and

    " will be operative in case these appellants do not succeed in this court in a. A. O. No. 259 of 1962"
    . It is this direction that is impugned in this appeal.

    (4) It is urged by sri babulu reddy that the learned judge, having dismissed the appeal, could not issue a direction like this. It is maintained that the payment of the money could not be put off till the disposal of an appeal between the respondent and a third party and to which the appellant is not a party and that further the result in that appeal could not govern the fate of the appeal before him. Apart from the question whether the relevant statutory provisions would enable the judgment - debtor to assert that the property does not belong to him, we are unable to appreciate as to how the result of the appeal filed by the present respondent impleading a third party as a respondent could in any way affect the right of the appellant further, we are told that that appeal ended in a compromise by and under which the present respondent had to pay the respondent in that appeal the full decretal amount - no doubt in instalments - (excluding the amount under attachmenc - the reference, according to the appellant's advocate, being the one involved in the appeal to the present amount). Be that as it may, aralready stated, the rights of the appellant could not be made to depend upon an adjudication in an appeal to which he was not a party. We, therefore, feel that this is a direction which is contrary to the principles of law.

    (5) Even otherwise, we do not think that effect should be given to the objection of the respondent. It is to be remembered at the outset that the person, for whose benefit the amount is alleged to have been deposited by the respondent, does not put forward any claim to it. On the other hand, he disclaimed it, alleging that the deposit did not conform to the conditions of compromise. In such a position, could it be posited that the respondent could object to the attachment on the ground of its belonging to a person who admittedly asserts that he had nothing to do with it. Order 21, rule 58 contemplates the investigation of a claim when one is made. "that provision implies that the claim should be made by a person putting forward a right or title to the property attached. An objection by the judgment - debtor that he is not the owner thereof, does not bring it within the terms of Order 21, rule 58. We are not persuaded that it is open to the judgment - debtor to resist the attachment contending that the owner thereof is someone else and not the judgmentdebtor investigation of such a claim cannot be made in the absence of the person to whom the ownership is attributed, especially when that person disclaims any "title thereto. It should be remembered that if adjudication is made undei Order 21, rule 58, that would be binding on the claimant subject to the result of a suit. How could that result be achieved when the objection is made not by the person who is supposed to be the owner thereof, but by a third party. In other words, the court is called upon to make an adjudication which will have no binding force on "the person who is alleged to be the rightful owner thereof. The present is an a fortiori case where the third party far from putting forward any right 01 title to the property attached, asserts that he had no concern with it.

    (6) We do not think that the case of lakshman dadaji v. Damodar ambadas, lends any countenance to the theory that when the judgment - debtor says that the property attached is not his, the objection should be accepted and the attachment raised. Jn the case under citation, pursuant to a direction of a court, the judgment - debtor deposited a sum of rs. 140 - 8 - 0. Both the parties appealed against that order, but pending the appeals, the defendant paid the amount into court, the respondent refusing to take it. This amount was attached by a creditor of the defendant in the suit and ultimately drawn out by him. Subsequently, the appeal against the order directing the defendant to pay rs. 140 - 8 - 0 to the plaintiff was confirmed. Thereupon plaintiff applied in execution for payment of this amount. The executing court called upon the defendant once again to pay this sum to the plaintiff.

    (7) It is in those circumstances that a division bench of the bombay high court decided that the plaintiff's refusal to take the money out of court did not justify the trial court in treating the money as the defendant's and in ordering it to be paid to another judgment - creditor of the defendant without his having in any way expressed his assent to the money being so treated.

    (8) The facts of that case are quite dissimilar to those here. It is to be remembered that the money in that case was brought to court by the defendant in compliance with the order. , of the court. Unlike that, in the present case the deposit was not made as required by any court. It is only towatds the amount due by him under a compromise decree that the money was deposited, which according to the respondent therein was contrary to the terms of the compromise. Moreover, in the bombay case (lakshman dadaji v. Damodar ambadas, (1891) i. L. R. 15 bom. 681.) , the question did not present itself under Order 21, rule 58. That was not a case where the judgment - debtor pleaded that he was not the owner of the property and consequently could not be attached.

    (9) This view of ours gains support from the observations of a division bench of the orissa high court in khetramohan v. Sidha kamal, a. I. R. 1956 orissa 296. For these reasons, we hold that the objection of the judgment - debtor was not a tenable one and the trial court rightly negatived it. Moreover, in this case the partieo have compromised and so it is difficulty to postulate as to who has succeeded, with the result that if the direction is allowed to stand, the money will continue to be under attachment, but the decree - holder will not be able to withdraw it, nor can the judgment - debtor take it away surely, such a stalemate cannot be allowed to exist. In these circumstances, the direction of the learned judge mentioned above cannot stand. If follows that the appeal should be allowed. The appellant will get his costs of this appeal and before justice munikanniah. Appeal allowed.

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    Comments

    Jai Prakash Talkies v. Lakshmi Talkies
    (Mar 31, 1964)