Case title:
Bhagyoday Cooperative Bank Ltd. vs Ravindra Balkrishna Patel
Date of Order:
16 November 2022
Bench:
K.M. Joseph, Hrishikesh Roy
Parties:
Appellant - Bhagyoday Cooperative Bank Ltd
Respondent - Ravindra Balkrishna Patel
SUBJECT
The case at hand evolved through a suit filed under the Gujarat Co-operative Societies Act, 1961. The Gujarat Co-operative Societies Act of 1961 is legislation that governs the functioning of cooperative societies in Gujarat. The Act defines cooperative societies and provides for their formation, registration, and management. This case also deals with three significant provisions of the Code of Civil Procedure such as Section 38, Section 39, and Order 21 Rule 46. Section 38 provides for the court by which the decree may be executed. Section 39 provides for the transfer of decree. Order 21 Rule 46 of the CPC provides for the attachment of debt, shares, and other property not in the possession of the judgment-debtor.
IMPORTANT PROVISIONS
Code of Civil Procedure, 1908
- Section 38
- Section 39
- Order 21 Rule 46
OVERVIEW
- The appellant provided a financial facility to a firm where the respondent was a partner.
- Due to the non-repayment of the amount, a suit was filed by the appellant before the Board of Nominees under The Gujarat Co-operative Societies Act, 1961.
- An order was passed by the adjudicatory body directing the defendants to make a payment of Rs.2,61,314.34ps with 20.5% interest p.a. from the date of the suit till the realization and cost of the suit to the plaintiff.
- Initially, the appellant filed an Execution Application No.777/1995 before the City Civil Court, Ahmedabad.
- In a petition filed before a court of competent jurisdiction on 02.02.2005, the appellant requested the withdrawal of the Execution Application. This application was allowed.
- Thereafter, the appellant filed an execution petition before the 4th Additional Senior Civil Judge (Ahmedabad Rural).
- The executing court ordered deposit of the actual remaining amount in this Darkhast after paying the Darkhast, interest, and cost come on the share of opponents Ravindra Balkrishna Patel and Nikhil Balkrishna Patel out of the credited amount in Special Darkhast.
- The respondents challenged this decision and appealed to the High Court. The Hon’ble High Court set aside the impugned order of the executing court.
- Aggrieved by this High Court decision, the appellants filed the present appeal before the Supreme Court of India.
ISSUES RAISED
- If the execution petition filed by the appellant is dismissed on the grounds of default or withdrawal, will that bar the filing or prosecution of the second execution petition?
- Whether the filing of the execution petition is governed by the regime provided under Sections 38 and 39 of the CPC.
ARGUMENTS ADVANCED BY THE APPELLANT
- Learned Senior Counsel, Mr. Preetesh Kapur represented the appellant.
- The counsel contended that the mere fact that the earlier execution petition was dismissed would not stand in the way of the processing and consideration of the second execution petition.
- Reliance was placed on the case of Shivashankar Prasad Shah and Others Versus Baikunth Nath Singh and Others, [1969 (1) SCC 718] to point out that the second petition would be maintainable if it was withdrawn with liberty and even if it is dismissed on default.
- It was held that the dismissal of the earlier execution petition on the ground of default would not bar the filing of a fresh execution. A second petition may be filed as long as it is filed within the limitation period.
- The case of Sundaram Finance Limited versus Abdul Samad and Another, [(2018) 3 SCC 622] states that a fresh execution petition may be filed in the Court with jurisdiction once the second application has not been barred by limitation.
ARGUMENTS ADVANCED BY THE RESPONDENT
- Learned counsel Mr. Aniruddha Deshmukh appeared on behalf of the respondents.
- The counsel submitted that the interpretation placed under Sections 38 and 39 of the CPC by the High Court is unexceptionable.
- The counsel asserted that the High Court was fully correct in its interpretation of Order 21 Rule 46 and Order 21 Rule 46A. He cited three judgments to support the above point which are as follows: - Nuthalapati Kotaiah vs. Executive Officer TTD Office at Guntur [(1985) 3 AP LJ 103], The Madurai City Municipal Corporation, Madurai vs. N. Baskara Pandian & another [1998 SCC Online Mad 75], T. C. Division, K.S.E. Boards, Palghat versus J. H. Sharma and another [AIR 1988 Ker. 285].
- It was further submitted by the counsel that Order 21 Rule 46 of CPC and the provisions which follow these provisions are intended to safeguard the garnishee's interests. Any deviation from the mandatory scheme will cause grave injustice to the garnishee.
JUDGEMENT ANALYSIS
- The Supreme Court of India allowed the present appeal and set aside the impugned High Court order.
- When a decree-holder files a fresh execution petition within the time limit, the court ruled that merely dismissing the first application for default will not prevent him/her from filing a second application.
- It was observed that in view of the fact that Sections 38 and 39 of the CPC are not as such applicable, the decree-holder may seek to execute the decree in any Court which otherwise has jurisdiction.
- The bench however held that it was correct for the High Court to hold that the Execution Court should have first attached the debt under Order 21 Rule 46 before passing an order under Order 21 Rule 46A.
- Lastly, the court directed that the order passed by the Execution Court must be treated as an order by which the attachment has been made under Order 21 Rule 52 of the CPC.
CONCLUSION
The Code of Civil Procedure, 1908 is a set of laws governing the procedures that should be followed in civil cases in India. It outlines the rules and regulations that need to be followed when filing or defending a civil case in court. The Supreme Court in this case delivered valuable insights regarding three of the important provisions of the Act. It was ruled clarified by the court in this case that the filing of a second execution petition would not be illegal for the reason that there was no order under Section 39 of CPC. It will remain to be maintainable. The bench consisting of Justice K.M. Joseph, and Justice Hrishikesh Roy also reiterated that the definite scheme provided under Order 21 Rule 46 and its subsequent additions, unerringly point out that they’re mandatory in nature.
