T. Doraswamy Reddy v. K. Kodanda Naidu

1. The petitioner questions the order of the 1st Additional District Munsif, Chittoor in O.E.P No. 257 of 1988 in O.S No. 616 of 1985 dated 14-3-1990 directing the judgment-debtor to pay the entire decretal amount of Rs. 21,318.75 ps., which included interest upto 2-9-1988, on or before 30-4-1990 failing which he would be liable for arrest without any further enquiry.

2. This C.R.P was admitted on 23-4-1990 and this Court granted interim stay in C.M.P No. 5941 of 1990 on condition that the petitioner deposited one-fourth of the decretal amount within two months and permitting the respondent/decree-holder to withdraw the amount, if deposited, without furnishing security.

3. The petitioner sought extension of time on 14-6-1990 in C.M.P No. 7689 of 1990 and on 15-6-1990 it was extended by 10 weeks. On the respondent's C.M.P.No 17743 of 1990 for vacating the interim stay, this Court on 24-1-1991 ordered that the interim stay be made absolute subject to the condition of the petitioner paying another one-fourth of the decretal amount within one month from that day, and permitting the respondents to withdraw the amount, if any deposited, without furnishing security. Subsequently, in C.M.P No. 2446 of 1991 by order dated 22-2-1991 this Court extended the time for making that deposit till the end of March, 1991 stating that in default the stay shall stand vacated.

4. The learned Counsel for the respondent states that the petitioner did not deposit another one-fourth of the decretal amount as directed by this Court on 24-1-1991 and 22-2-1991, and that, therefore, the stay should be deemed to be vacated. However, the petitioner was not arrested in view of the pendency of the C.R.P

5. On going through the judgment of the learned 1st Additional District Munsif, it is seen that he proceeded on the basis that the burden lay on the judgment-debtor to establish that he had no property to meet the decree to avoid arrest and that “the liability of the decree-holder to prove with regard to means is not so strict but it is only placing some prima facie material with regard to his means”. On that basis, the learned 1st Additional District Munsif held that the decree-holder was able to satisfy the Court with regard to the means of the judgment-debtor, and that the burden then shifted to the judgment-debtor to establish that he had no means to satisfy the decree. The learned 1st Additional District Munsif himself pointed out that apart from the oral statement made by the decree-holder, no material whatsoever was placed before him to establish that the judgment-debtor had the means and yet did not care to discharge the decree. The learned 1st Additional District Munsif stated as follows:

“It is to be seen that the judgment-debtor except stating orally with regard to allegations made by him in his counter he did not examine any other witnesses nor filed any documents in support of his contentions. Therefore, what all the judgment-debtor has stated in his counter is only supported by oral evidence by the judgment-debtor. Therefore, the Court has to consider the oral evidence of the judgment-debtor alone to come to a conclusion with regard to his liability to pay the E.P amount.”

6. But, this is placing the cart before the horse because the decree-holder had not placed any evidence whatsoever to establish that the judgment-debtor was having any property or any means whatsoever to discharge the decree apart from his own oral statement. The learned 1st Additional District Munsif observed as follows:

“When cross examined by the Counsel for the judgment-debtor, he (decree-holder) admitted that he has filed the affidavit in support of the E.P He also admitted his signature in the said affidavit. He stated that he did not state in his affidavit that the judgment-debtor owns Ac. 20.00 of landed property and getting an income of Rs. 1,25,000/- and he is evading to pay the decree amount. He also replied that he has stated to his Advocate with regard to the tractor and rig. He replied that he did not file any documents to show that the judgment-debtor is having tractor and also rig machine in his name. He denied the suggestion that the judgment-debtor is not having any tractor or rig machine in his name. He denied the suggestion that the judgment-debtor is having mango and coconut garden. He also denied the suggestion that the judgment-debtor is not having any lands in his name. He admitted that he has not filed any documents to show that the judgment-debtor is having lands as stated by him. He also denied the suggestion that the lands which are attached before judgment do not belong to judgment-debtor. He denied the suggestion that the judgment-debtor has no means to pay the E.P amount and that he is liable for arrest.”

7. Thus apart from the oral statement of the decree-holder, no material was placed before the Court at least prima facie to establish that the judgment-debtor was having the means and yet neglected to pay the decretal amount with a mala fide intention. In the absence of any material placed by the decree-holder that the judgment-debtor was avoiding payment of the decree inspite of his having means, the finding of the learned 1st Additional District Munsif by placing the burden on the judgment-debtor is in my view perverse and not supported by any acceptable material. See the recent judgment of B.K Somasekhara, J. referring to the decision of the Supreme Court in Jolly George Varghese v. The Bank of Cochin (1) (1980) 2 SCC 360 : AIR 1980 SC 470 and the decisions of this Court and Kerala and Madras High Courts, in A. Venkata Rao v. K.V.S.K Jaganmohan Rao (2) 1994 (3) ALT 538. See also Mukh Ram v. Hardeep Singh (3) AIR 1987 Raj. 1, D. Viswanathan v. The Karnataka Bank Ltd. (4) AIR 1988 Ker. 274 and K. Karunakar Shetty… v. Syndicate Bank, Manipal…. (5) AIR 1990 Kar. 1.

8. It has also to be noticed that this is a case where the judgment-debtor appeared in Court pursuant to the notice issued to him under Rule 37 of Order 21 of the Code of Civil Procedure (for short ‘the Code) and showed cause why he should not be committed to the civil prison and thereafter the Court heard the decree-holder and the judgment-debtor under Rule 40 of Order 21 of the Code. Sub-rule (3) of the said Rule 40 provides as follows:

“(3) Upon the conclusion of the inquiry under sub-rule (1) the Court may, subject to the provisions of Section 51 and to the other provisions of this Code, make an order for the detention of the judgment-debtor in the civil prison and shall in that event cause him to be arrested if he is not already under arrest:

Provided that in order to give the judgment-debtor an opportunity of satisfying the decree, the Court may, before making the order of detention, leave the judgment-debtor in the custody of an officer of the Court for a specified period not exceeding fifteen days or release him on furnishing security to the satisfaction of the Court for his appearance at the expiration of the specified period if the decree be not sooner satisfied.”

9. This has to be read along with Section 58 of the Code. Sub-section (1) of Section 58 of the Code provides, inter alia, that every person detained in the civil prison in execution of a decree shall be so detained “where the decree is for the payment of a sum of money exceeding one thousand rupees, for a period of not exceeding three months….” (emphasis supplied). This provision gives discretion to the Court to fix the period for which the judgment-debtor should be detained in a civil prison, the maximum period for which the judgment-debtor could be detained being three months. It is obvious from this that while directing arrest under sub-rule (3) of Rule 40 of Order 21 of the Code, the Court will have to fix the period for which the judgment-debtor should be kept under detention. The learned 1st Additional District Munsif has not specified the period for which the judgment-debtor should be kept in detention, which shows that he has not applied his mind in this regard. See the decision of the High Court of Bombay in Pundalik v. Maharashtra State Farming Corpn. (6) AIR 1992 Bom. 48.

10. In the circumstances, I am satisfied that the order of the learned 1st Additional District Munsif is liable to be set aside.

11. Accordingly, the C.R.P is allowed. No costs.