The facts are not in dispute in this case. The suit was for money and before the decree an application for attachment was made. 20 items of property belonging to the defendants were attached before payment. The defendants applied to the Court to release the properties from attachment and offered to give security. The security comprised five items of the attached property. Exhibit A was the bond given to the Court by the defendants.
After the plaintiffs obtained the decree, they proceeded to levy execution against the property given as security. The District Judge has held that the plaintiffs have not obtained a charge of lien over the property, and are not entitled to get the decree amount realised out of this property. We are unable to agree with him. There are two classes of cases each of them well defined, and the question is under which of these classes the present bond comes. It was held in T. Errikulappa Chetty…(Counter-Petitioner) v. The Official Assignee Of Madras…(Petitioner) .*(1) that where a bond is given for the production of certain property in Court the person who secures the giving of this bond is not entitled to any preferential right in the property comprised in the bond. Cases where security is given for appearance also belong to this class. In such cases, the person who enables the bond to be taken, obtains no preferential right. Again in cases in which there is a bare attachment under the Code of Civil Procedure it does not give a right of lien to the person who gets the property attached. The principle underlying all these decisions is that where a bond is given for appearance or where a bond is given for the production of property or where there is an attachment, the bond is not earmarked for the credit of the suit. The second class of cases which is illustrated by the decision in Ramiah Aiyar v. Gopalaier(2), lays down that where something has been done for the credit of a suit, then the party who procures that thing is entitled to a preferential right in the bond given. In Ramier v. Gopalaier, money was deposited in Court and that was held to give the plaintiff the right over others. In Subramanian Chettiar v. Raja of Ramnad(3), the learned Chief Justice and Kumaraswami Sastriar, J., point out that the giving of a bond is on the same footing as depositing money in Court.
Abdur Rahim and Oldfield, JJ., in Gopalaiyar v. Thiruvengadam Pillai, held that where money has been deposited to the credit of a suit, the plaintiff obtains a preferential right to it. So the distinction is clear that where money is deposited in Court or something is done to make the security earmarked for the particular suit in which the action was taken, then the person who gets the security is entitled to a preferential right over others who may subsequently come in. We are clear in the present case, that having regard to the terms of the bond it must be taken to have been given for the credit of the plaintiffs in the suit and that the plaintiffs are entitled to a preferential right, and consequently ought to have been allowed to execute the decree against the property given as security.
We must reverse the decision of the District Judge and remand the petition for disposal according to law. Costs to abide the result. It was pointed out to us that the fixing of the Vakil's fee at the ad valorem scale of 5 per cent was wrong. Both the Vakils are agreed upon that. The Lower Appellate Court in allowing the Vakil's fees will see that 5 per cent, is not allowed. This judgment will not prejudice any right which the Official Receiver may have to contest the validity or bona fides of the security.
K. V. S.Appeal allowed. Case remanded.